******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. 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 In the Matter of ) ) Ameritech Long-Term Number Portability ) CCB/CPD 98-26 Query Services ) ) Ameritech Tariff F.C.C. No. 2, ) Transmittal No. 1149, as Amended ) Memorandum Opinion and Order Adopted: April 3, 1998 Released: April 3, 1998 By the Chief, Competitive Pricing Division: I. Introduction 1. In this Memorandum Opinion & Order we grant Ameritech's application to file on not less than one day's notice to advance the currently scheduled effective date of its long-term number portability query service tariff revisions set forth in Ameritech Transmittal No. 1149, as amended. We also suspend those revisions for one day and set them for investigation. II. Background 2. The inability of customers to retain their telephone numbers when changing local service providers hampers the development of local competition. Section 251(b)(2) of the Communications Act of 1934, as amended, seeks to remove this impediment to competition by requiring all local exchange carriers (LECs) "to provide, to the extent technically feasible, number portability in accordance with requirements prescribed by the Commission." To prevent the cost of providing number portability from itself becoming a barrier to local competition, section 251(e)(2) requires that "[t]he cost of establishing number portability shall be borne by all telecommunications carriers on a competitively neutral basis as determined by the Commission." 3. In a combined First Report and Order (Order) & Further Notice of Proposed Rulemaking (Further Notice), the Commission promulgated performance criteria that long-term number portability solutions must meet, required local exchange carriers to implement long-term number portability through a system of regional databases managed by neutral third party administrators, and established a schedule for deployment of long-term number portability. In light of questions regarding the design and deployment of a long-term number portability system, the Order could not, and did not, resolve how carriers should bear the costs of providing long-term number portability. The Commission issued instead a Further Notice to implement section 251(e)(2) with respect to the costs associated with building and operating the long-term number portability system. The Commission has not yet issued a decision resolving the issues it raised in the Further Notice. 4. Carriers intend to provide number portability through a location routing number (LRN) architecture. Under an LRN architecture, each customer's telephone number is matched in one of seven databases with an LRN that identifies the switch that currently serves that telephone number. Neutral third parties, called local number portability administrators, will administer these regional databases. When a customer changes from one LEC to another, the carrier that wins the customer will "port" the customer's number from the former carrier by electronically transmitting (uploading) the new LRN to the administrator of the relevant regional database. This will pair the customer's original telephone number with the LRN for the switch of the new carrier, allowing the customer to retain the original telephone number. The regional database administrators will electronically transmit (download) LRN updates to carriers responsible for routing telephone calls. When a carrier routes an interswitch telephone call to a location where number portability is available, the carrier will "query" this downloaded data to determine the LRN for the switch that serves the terminating telephone number of the call. 5. In the Second Report and Order, the Commission approved the industry's "N minus one" (N-1) querying protocol. Under this protocol, the N-1 carrier will be responsible for the query, "where 'N' is the entity terminating the call to the end user, or a network provider contracted by the entity to provide tandem access." Thus, the N-1 carrier for a local call will usually be the calling customer's LEC; the N-1 carrier for an interexchange call will usually be the calling customer's interexchange carrier. Rather than perform its own querying, an N-1 carrier may arrange for other carriers or third parties to provide querying services for them. The Commission determined in the Second Report and Order that an incumbent LEC may charge an N-1 carrier for performing queries on the N-1 carrier's behalf pursuant to such an arrangement. 6. The Commission also noted that when an N-1 carrier fails to ensure that a call is queried, the call might be routed by default to the LEC that originally served the telephone number, usually an incumbent LEC. If the customer has switched carriers, the LEC that originally served the customer incurs costs in querying and redirecting the call. This could happen, for example, if there is a technical failure in the N-1 carrier's ability to query, or if the N-1 carrier fails to ensure that its calls are queried, either through its own query capability or through an arrangement with a third party. The Commission determined that an incumbent LEC may charge the N-1 carrier for querying default- routed calls. The Commission determined further that it would "allow LECs to block default-routed calls, but only in specific circumstances when failure to do so is likely to impair network reliability." The Commission also said that it would "require LECs to apply this blocking standard to calls from all carriers on a nondiscriminatory basis." 7. The Competitive Pricing Division of the Common Carrier Bureau issued two orders October 30, 1997, and December 30, 1997, granting petitions by Ameritech, Bell Atlantic, Southwestern Bell, and Pacific Bell to establish new service rate elements to provide long-term number portability query services. These rate elements described services under which Ameritech, Bell Atlantic, Southwestern Bell, and Pacific Bell would query traffic routed to them by other carriers on a prearranged basis or by default. The Division required all four carriers to conform their rates, rate structures, regulations, and services offered under these rate elements to any determinations made by the Commission in CC Docket No. 95-116. On March 30, 1998, the Commission declared unlawful for lack of adequate cost support Ameritech tariff revisions, filed under transmittal nos. 1123 and 1130, designed to implement long-term number portability query services. 8. Ameritech filed Transmittal No. 1149 on March 31, 1998, proposing a uniform charge to query prearranged and default traffic that N-1 carriers deliver at an end office or tandem office. The transmittal describes tariff revisions to become effective April 15, 1998, based on the statutory 15- day streamlined notice requirement. Hoping that the Commission would allow the tariff revisions to take effect on the "earliest date possible," Ameritech also filed an application for waiver of sections 61.58 and 61.59 of the Commission's Rules, under which April 15, 1998, would be the earliest possible effective date for the tariff revisions as filed by Ameritech. III. Discussion 9. We grant Ameritech's application and waive sections 61.56, 61.58, and 61.59 of the Commission's Rules for the purpose of allowing Ameritech to advance the effective date of Ameritech Transmittal No. 1149, as amended, on not less than one day's notice. Ameritech apparently already has identified customers for its query services. Furthermore, Ameritech may need to provide query services in those areas in which it is required to provide number portability pursuant to the Commission's orders in CC Docket No. 95-116. Accordingly, we find good cause for granting Ameritech a waiver. 10. We conclude, however, that the tariff revisions in Ameritech Transmittal No. 1149, as amended, raise substantial questions of lawfulness regarding Ameritech's cost and demand development; its use of a fully distributed cost annual charge factor; the jurisdictional allocation of number portability costs; its requirement that prearranged query service customers provide detailed, rolling, three-month estimates of the volume of unqueried traffic they intend to deliver to Ameritech; and its standards for blocking unqueried traffic. We will, therefore, suspend the tariffs for one day and include them in the pending investigations of similar tariff revisions filed by Pacific Bell and Southwestern Bell. We will impose an accounting order with respect to the services offered under this transmittal during the course of the investigation to ensure that customers can be reimbursed should the Commission determine after investigating the tariff revisions that Ameritech's rates or conditions of service are unlawful. IV. Ordering Clause 11. Accordingly, IT IS ORDERED that a grant of Application No. 298 IS JUSTIFIED, and sections 61.56, 61.58, and 61.59 of the Commission's rules, 47 C.F.R.  61.56, 61.58, and 61.59, are waived for the purpose of allowing Ameritech to advance the effective date of Ameritech Transmittal No. 1149, as amended, on not less than one day's notice. 12. IT IS FURTHER ORDERED that Ameritech should cite the "DA" number of this Order as its authority for this filing. 13. IT IS FURTHER ORDERED that, pursuant to section 204(a) of the Communications Act of 1934, as amended, 47 U.S.C.  204(a), and sections 0.91 and 0.291 of the Commission's Rules, 47 C.F.R.  0.91, 0.291, the tariff revisions described in Ameritech Transmittal 1149, as amended, ARE SUSPENDED for one day and included in the investigation of the tariff revisions described in Southwestern Bell Transmittal No. 2694 and Pacific Bell Transmittal No. 1973. 14. IT IS FURTHER ORDERED that Ameritech SHALL FILE a supplement no later than 5 days after release of this Memorandum Opinion and Order reflecting the one day suspension, to be filed concurrently with any filing advancing the effective date of Transmittal No. 1149, as amended. 15. IT IS FURTHER ORDERED that, pursuant to section 204(a) of the Communications Act of 1934, as amended, 47 U.S.C.  204(a), and sections 0.91 and 0.291 of the Commission's Rules, 47 C.F.R.  0.91 and 0.291, Ameritech SHALL KEEP ACCURATE ACCOUNT of all amounts that are associated with the rates that are subject to this investigation. FEDERAL COMMUNICATIONS COMMISSION Jane E. Jackson Chief, Competitive Pricing Division Common Carrier Bureau