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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 Border to Border Communications, Inc.) ) Request for Waiver of Five-Digit Carrier) NSD File No. 97-85 Access Code (CAC) Dialing During the ) Permissive Dialing Period ) ORDER Adopted: January 28, 1998 Released: January 28, 1998 By the Chief, Network Services Division, Common Carrier Bureau: I. INTRODUCTION 1. Carrier identification codes (CICs) are numeric codes that enable local exchange carriers (LECs) providing interstate interexchange access services to identify the interstate interexchange carrier (IXC) that the originating caller wishes to use to transmit its interstate call. LECs use the CICs to route traffic to the proper IXC and to bill for the interstate access service provided. CICs facilitate competition by enabling callers to use the services of telecommunications service providers either by presubscription or by dialing a carrier access code, or CAC, which incorporates the carrier's unique Feature Group D CIC. Originally, CICs were unique three-digit codes (XXX) and CACs were five-digit codes incorporating the CIC (10XXX). 2. On April 11, 1997, in the CICs Second Report and Order, the Commission approved an industry plan to expand Feature Group D CICs from three to four digits on the ground that it was a reasonable method of meeting future demand for CICs as the supply of three-digit codes was exhausted. The industry agreed that as the expansion from three to four-digit CICs occurred, and as carriers replaced their five-digit CACs with seven-digit CACs, a transition, or permissive dialing period, was needed. The industry, however, was unable to agree on the length of the transition. In its 1994 CICs NPRM, the Commission proposed a six-year period. In the CICs Second Report and Order, however, because of the rapidly depleting pool of available three-digit CICs, the Commission decided to end the transition on January 1, 1998. The Commission also denied requests to "grandfather" (i.e., to permit carriers to continue to use) previously assigned three-digit CICs that are in use at the end of the transition. The Commission's decisions were intended to advance the pro- competitive objectives of the Communications Act of 1934 (the Communications Act or the Act), as amended by the Telecommunications Act of 1996 (1996 Act). 3. On October 22, 1997, in the CICs Order on Reconsideration, the Commission modified the decision in the CICs Second Report and Order regarding the length of the transition during which three and four-digit Feature Group D CICs co-exist, and created a "two-step" end to the transition to four-digit CICs. Under the CICs Order on Reconsideration, all LECs that provide equal access must have completed switch changes to recognize four-digit CICs by January 1, 1998, the end of the first phase. The second phase, which ends on June 30, 1998, is intended to allow interexchange carriers time to prepare their networks for, and educate their customers about, the replacement of three-digit CICs by four-digit CICs. After June 30, 1998, only four-digit CICs and seven-digit CACs will be recognized. The Commission also affirmed its decision in the CICs Second Report and Order not to grandfather the use of three-digit CICs and five-digit CACs that are in use during the transition. 4. In response to petitions filed by small LECs seeking waivers of the CICs Second Report and Order's January 1, 1998 conversion deadline, the Network Services Division (Division) of the Commission's Common Carrier Bureau (Bureau), on December 3, 1997, December 15, 1997, December 24, 1997, December 31, 1997, and January 8, 1998, granted extensions of the conversion deadline. 5. On December 30, 1997, Border to Border Communications, Inc. (Border to Border), a LEC who, on November 4, 1997, converted to equal access its one exchange serving 77 access lines, filed a request for waiver asking that we permit it not to process three-digit CICs (and five-digit CACs) for the remainder of the permissive dialing period. In this Order, for the reasons discussed below, we conclude that Border to Border's request for waiver should be granted. II. DISCUSSION 6. The Commission may waive any provision of its rules, in whole or in part, if good cause is shown. An applicant for waiver must demonstrate that special circumstances warrant a deviation from the general rule and that such deviation will serve the public interest. In the Orders addressing petitions for waiver of the January 1, 1998 LEC conversion deadline, we weighed three factors in evaluating each petition for waiver: (1) the LEC's diligence in upgrading its switches to meet the conversion deadline; (2) the availability from manufacturers of products required to accomplish the upgrade; and (3) the impact of an extension of the conversion deadline on the IXCs served by the LEC's switches and on customers' ability to reach IXCs through CAC dialing. In evaluating Border to Border's request, we consider factors similar to those that we weighed in evaluating the requests for extension of the conversion deadline. Specifically, we have weighed the LEC's demonstrated diligence in meeting the requirements of the CICs Second Report and Order and CICs Order on Reconsideration, and the impact of the grant of the requested relief on IXCs and on their customers' ability to reach the IXCs by CAC dialing. 7. We find that Border to Border's request for waiver demonstrates special circumstances meriting a waiver of the requirement to accept both three and four-digit CICs during the permissive dialing period. First, Border to Border has demonstrated that it has worked diligently to comply with the CICs Second Report and Order and the CICs Order on Reconsideration. In an effort to comply with the CICs Second Report and Order's requirement that all LECs convert their switches to accept four-digit CICs by January 1, 1998, Border to Border upgraded to equal access on November 4, 1997. Although that conversion actually occurred after release of the CICs Order on Reconsideration, which extended the end of the permissive dialing period until June 30, 1998, and limited the January 1, 1998 LEC conversion deadline to those LECs already providing equal access, Border to Border asserts that, at the time it converted to equal access, it thought the end of the permissive dialing period would be on January 1, 1998, as the Commission had originally determined. Border to Border states that it did not become aware of the extension of the permissive dialing period until after its equal access conversion. In addition, Border to Border asserts that, technically, its Mitel GX5000 switch (which connects with a Southwestern Bell Telephone Company LATA tandem) is not capable of providing the five and seven-digit CAC dialing formats simultaneously, forcing Border to Border to choose either the five or the seven-digit CAC format. Operating under the assumption that the original January 1, 1998 deadline was still in place, Border to Border decided that, from a customer education standpoint, it would be better to implement the mandatory 101XXXX CAC dialing format since it would affect IXCs and customers less than implementation of only the five-digit CAC format. We find that Border to Border diligently pursued four- digit CIC capability in an effort to meet the requirements of the CICs Second Report and Order and to minimize burdens on IXCs and customers. 8. Second, we conclude that the impact of a waiver on the IXCs served by Border to Border, and on the ability of Border to Border's customers to reach their IXCs through CAC dialing, does not outweigh the burden on Border to Border that would be imposed by a denial of its request for waiver. Border to Border serves one exchange with a total of only 77 access lines. If we denied its waiver request, Border to Border would be forced to adopt one of two courses of action to comply with the CICs Second Report and Order and CICs Order on Reconsideration. First, Border to Border could reprogram its switch to recognize three-digit CICs, and seek a waiver of the January 1, 1998 deadline for conversion to accept four-digit CICs and the requirement that its switch accept both three and four-digit CICs until the end of the permissive dialing period on June 30, 1998. Border to Border then would be forced to again reprogram its switch to process only four-digit CICs on June 30, 1998. Secondly, Border to Border could comply with the CICs Second Report and Order and CICs Order on Reconsideration by replacing its Mitel GX5000 switch with a switch that has the capability to accept both the five-digit and seven-digit CAC dialing formats, for the remaining months until the end of the permissive dialing period on June 30, 1998. In either event, the costs of the switch reprogramming or switch replacement would be borne by Border to Border's customers. We find that the economic burden of requiring Border to Border to reprogram or replace its switch so that it complies with a requirement that will expire in less than six months outweighs the burden that will be imposed on IXCs and their customers by the grant of Border to Border's waiver request. We note, moreover, that only IXCs that have been issued a three-digit CIC (who cannot currently receive CAC calls originating with Border to Border's customers) will be affected by the grant of this waiver. Although we recognize the potential anticompetitive effects of the inability of certain subscribers to reach their IXCs through CAC dialing, and seek to minimize them, we believe that those effects are outweighed by the economic burdens likely to be imposed on Border to Border by a failure to grant its waiver request. Further, granting Border to Border's request, and allowing it not to process three-digit CICs and five-digit CACs for the remainder of the permissive dialing period, will not interfere with the end of the permissive dialing period on June 30, 1998. 9. We recognize that the grant of this extension to Border to Border effectively may change the way IXCs served by Border to Border educate their customers about the permissive dialing period. In the CICs Order on Reconsideration, the Commission extended the permissive dialing period from January 1, 1998 to June 30, 1998, to allow IXCs greater time in which to prepare their networks for and educate their customers about the change in CAC dialing. The Commission also required LECs to offer a standard intercept message beginning on or before June 30, 1998, explaining that a dialing pattern change has occurred and instructing the caller to contact its IXC for further information. In developing an intercept message, LECs are required to consult with IXCs and to reach agreement on the content of the message and on the period of time during which the message will be provided. 10. We note that Border to Border only recently converted to equal access, and has never processed three-digit CICs. Customers, however, may attempt to reach IXCs using five-digit CACs. During the period of January 1, 1998 to June 30, 1998, customers may be confused by their inability to reach IXCs' networks through five-digit CAC dialing. Thus, to lessen any confusion, and the burden on IXCs and their customers, we require Border to Border to provide an intercept message that will educate customers about the need to dial a seven-digit CAC, rather than a five-digit one, until the permissive dialing period ends on June 30, 1998. Border to Border's intercept message also should instruct callers to contact their IXC for further information. IV. ORDERING CLAUSES 11. IT IS ORDERED, pursuant to Section 1.3 of the Commission's rules, 47 C.F.R.  1.3, and authority delegated in Section 0.91 of the Commission's rules, 47 C.F.R.  0.91, and Section 0.291 of the Commission's rules, 47 C.F.R.  0.291, that the Request for Waiver of Border to Border Communications, Inc., IS GRANTED, by permitting it not to process three-digit CICs and five-digit CACs for the remainder of the permissive dialing period, ending on June 30, 1998, subject to the condition stated herein. FEDERAL COMMUNICATIONS COMMISSION Geraldine A. Matise Chief, Network Services Division Common Carrier Bureau