Report No. CC 98-10 COMMON CARRIER ACTION    April 17, 1998
   
  FCC PROPOSES MEANS FOR INCUMBENT LOCAL PHONE COMPANIES
  TO MEASURE, REPORT ON COMPETITORS' ACCESS TO NETWORKS
                  (CC Docket No. 98-56)
   
        The Commission has proposed a set of model rules by which to gauge whether
   new providers of local telephone service are able to access certain services and functions
   of incumbent local telephone companies in a manner consistent with the
   Telecommunications Act of 1996.  The proposed model rules are designed to help pave
   the way to more robust competition in the local telephone market while reducing the
   need for regulatory oversight.  By proposing to adopt model rules in the first instance,
   rather than legally binding federal rules, the Commission seeks to assist states in the
   technical area of performance measurements without hampering current state efforts to
   develop such measurements.
   
        Last November, the National Association of Regulatory Utility Commissioners
   (NARUC) adopted a resolution asking the Commission to provide the states with
   guidance in developing performance measurements and reporting requirements for use in
   assessing whether the operations support systems (OSS) that incumbent local phone
   companies provide to competitors are comparable to the OSS that the incumbents
   provide themselves, as required by the 1996 Act.  The resolution also recommends that
   the Commission give state commissions the flexibility to apply more stringent OSS
   performance standards as deemed necessary.
   
        Consistent with the NARUC resolution, the Commission asked for comment on
   model OSS performance measurements and reporting requirements.  By proposing to
   adopt model rules in the first instance, the Commission aims to assist those states that
   have not begun work in this area and allow those states that have commenced OSS
   proceedings to incorporate the model rules as they deem necessary.
   
        Congress in the 1996 Act recognized that, in order to promote competition, an
   incumbent local phone company must make available to new entrants certain network
   services and facilities.  Accordingly, the 1996 Act directs incumbents to provide
   competitors with nondiscriminatory access to the incumbents' networks by, in essence,
   serving as wholesale suppliers of network services and facilities.  Unlike many traditional
   wholesale/retail relationships, however, in this case, the wholesaler is both the retailer's
   sole supplier and its biggest competitor.
   
        The model rules would help carriers gauge the type of access an incumbent
   provides to its OSS.  Access to an incumbent's OSS includes the databases that maintain
   customer information and the computer systems used to process orders.  Incumbents use
   OSS to perform a variety of tasks, including signing up customers, providing repair
   service for customers, and billing customers.  New providers of local telephone service
   rely on the incumbent's OSS to perform these tasks for their own customers.  If a
   competitor lacks comparable access to the incumbent's OSS, that competitor may be
   disadvantaged in the marketplace by the inability to provide service of the same
   timeliness or quality as the incumbent's service.  The proposed performance
   measurements would also help carriers evaluate the access an incumbent provides to its
   interconnection facilities and its operator services and directory assistance.
   
        The Commission noted that performance monitoring reports should reduce the
   need for regulatory oversight by encouraging self-policing among carriers.  The reports
   should serve as a basis for discussion between competitors and incumbents to resolve
   performance disputes.  Should resort to the complaint process become necessary, the
   information contained in the performance monitoring reports could facilitate timely and
   fair resolution of the complaints.  
   
        The Commission did not propose performance standards or benchmarks for
   incumbents to meet, nor did it propose technical standards for incumbents' OSS
   interfaces.  Accordingly, the NPRM proposes only that incumbents track their
   performance; it does not propose that incumbents satisfy a preestablished level of
   performance.
   
        Action by the Commission April 16, 1998, by Notice of Proposed Rulemaking
   (FCC 98-72). Chairman Kennard, Commissioners Ness, Powell, and Tristani, with
   Commissioner Furchtgott-Roth dissenting and Commissioners Ness, Furchtgott-Roth, 
   Powell, and Tristani issuing separate statements.
   
                          -FCC-
                             
       News media contact:  Rochelle Cohen at (202) 418-0253.
       Common Carrier Bureau contact:  Radhika Karmarkar or Brent Olson 
            at (202) 418-1580.