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This is an unofficial announcement of Commission Action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 516 F 2d 385 (D.C. Circ 1974)

December 21, 2000
Michael Balmoris at 202-418-0253


SBC's $6.1 Million Payment to U.S. Treasury Brings Common Carrier-Related Enforcement
Actions to More Than $29 Million for the Year

SBC's Incentive Payment to Foster Local Competition is Triggered Under
eerms of its Merger with Ameritech

Washington, D.C. - The Federal Communications Commission (FCC) today announced its common carrier-related enforcement action totals for the year 2000. Following SBC Communications Inc.'s (SBC) $6.1 million voluntary incentive payment to the U.S. Treasury yesterday, common carrier-related enforcement actions for the year totaled more than $29 million. SBC's payment was the largest amount ever paid by a local phone company relating to performance in opening local markets. As the FCC continues to rely more on marketplace forces rather than regulation, the Commission's Enforcement Bureau ensures that companies follow FCC requirements so that consumers get the full benefits of competition.

SBC's payment is the result of its failure to meet performance goals established in the Carrier-to-Carrier Performance Plan adopted by the Commission as a condition for SBC's merger with Ameritech. The performance categories measure how well SBC is responding to its competitors' and customers' requests for information and interconnection to its phone network. Failing to provide its competitors with adequate service, such as timely processing of orders and satisfactory installation of service, makes it difficult for these companies to compete.

The payments are triggered when SBC fails to meet specified parity or benchmark performance goals over a three-month period - in this case August, September and October 2000. SBC is obligated to make voluntary incentive payments every month that it fails to meet the performance goals up to a potential $1.125 billion over three years.

In general, SBC's worst performing categories are in 1) the installation of resold local service, 2) "completion notices," which are notices SBC gives to competitors to inform them that SBC has finished switching the customer over, and 3) the failure to install service by a promised delivery-date. Most of the performance problems are in the Ameritech states, and the performance measurements were the worst in the following states: Illinois, Michigan, Ohio, Wisconsin, and Indiana.

Merger Condition Summary

In October 1999, FCC approved applications to transfer control of FCC licenses and lines from Ameritech Corp. (Ameritech) to SBC subject to significant and enforceable conditions. SBC proposed, and the Commission adopted, a requirement that SBC report, on a monthly basis and in each of the SBC 13 States, its performance in 20 measurement categories that are divided into 36 performance measurements. The measurements, which are based upon measures developed by the Texas and California Public Utility Commissions in conjunction with SBC and other carriers, reflect the quality of service that SBC's incumbent local exchange carriers provide to competing carriers. SBC is not required to report data for states in which it has received its section 271 application approval, such as Texas. Finally, the Carrier-to-Carrier Performance Plan supplements payments SBC may make to states and competitors under state-imposed performance monitoring plans or under interconnection agreements.

Enforcement Bureau Highlights

Highlights of the year's common carrier-related enforcement actions are in the two main areas summarized below and detailed on the attachment.

1. Consumer Protection Enforcement (e.g., slamming, misleading advertising, and unsolicited ``junk'' faxes): $16.6 million.

2. Competition Enforcement - (e.g., local market opening requirements of section 271, collocation requirements, and negotiation requirements): $6.6 million.

The Enforcement Bureau was established November 8,1999, and is now the primary Commission organization responsible for enforcement of the Communications Act as well as Commission rules, orders and authorizations. By consolidating enforcement functions into one streamlined Bureau, the Commission recognized the increasing need for prompt, fair and effective enforcement in a competitive telecommunications marketplace.


Common Carrier Bureau Staff Contact:
Carol Mattey at (202) 418-1500

Enforcement Bureau Staff Contact:
Richard Welch at (202) 418-7450

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