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In the course of these discussions, U S WEST proposed the price terms that would be acceptable for the  Xb-interLATA service component of its package,?b m {O -ԍXxId. at Tab 39, Appendix 12, (Deposition of Michael Murphy at 30).(#ƀ and U S WEST established customer service requirements that had to be met, the means for monitoring whether such requirements were  X4-met, and significant consequences for the failure to meet such requirements.@4 m {Om -ԍXxId. at Tab 39, Appendix 7 (U S WESTQwest Teaming Agreement at Exhibit B).(#Ɖ Under the terms of the agreement, an increase in price or a failure to provide adequate customer service  X-would be sufficient cause to terminate the business arrangement.DAm {O#-ԍXxId. (#D  X-x15.` ` On May 6, 1998, U S WEST introduced "a local and long distance marketing alliance" with Qwest under which U S WEST would market Qwest's interLATA services to"A,-(-(ZZ"  X-U S WEST's customers.Bm yOy-ЍxMcMaster Declaration at 11; Record of Proceeding (U S WEST) at Tab 20 (U S WEST's Memorandum in Opposition to AT&T's Motion for Temporary Restraining Order, or in the Alternative Preliminary Injunction on an Expedited Basis at 1) (May 26, 1998)(U S WEST TRO Opposition); Complaint, AT&T, MCI, and NEXTLINK Washington v. U S WEST, File No. E9842, at 10 (filed June 16, 1998)(AT&T Complaint U S  yO-WEST)). Under the business arrangement, termed the "Buyer's Advantage" program, customers would be able to obtain in one packaged offering U S WEST local  X-exchange and intraLATA toll services and Qwest's interLATA services.Cxm yO-ЍxAnswer of U S WEST Communications, Inc., File Nos. E9842 and E9843 at 7 (filed June 26, 1998) ( U S WEST Answer). Similar to the requirements of CompleteAccess, customers must subscribe to at least one U S WEST service  X-to become Buyer's Advantage customers.Dm yO% -ԍxStatus Conference Transcript at 107 (Lake Testimony) (acknowledgement by U S WEST that the only way to be a Buyer's Advantage customer is to take some U S WEST service).  Xv-x16. ` ` On May 11, 1998, U S WEST began a comprehensive marketing campaign of  X_-the program in six of its fourteen states,E _( m yO8-ЍxRecord of Proceeding (U S WEST) at Tab 8, 15 (Memorandum of Points and Authorities in Support of Motion for Temporary Restraining Order, or, in the Alternative, Preliminary Injunction on an Expedited Basis) (AT&T TRO Memorandum); Transcript of Qwest Press Conference at 2 (stating that by the end of the month (which would have been May) this service will be available in 14 states). which included running television and newspaper advertisements promoting the program. U S WEST also marketed the package through both  X1-inbound and outbound telemarketing.F1m yO-ԍx Record of Proceeding (U S WEST) at Tab 8 (AT&T TRO Memorandum); Record of Proceeding (U S WEST) at Tab 20 (U S WEST TRO Opposition at 6). U S WEST's marketing scripts provide in relevant part: XxI would be happy to share information with you regarding U S WEST Buyer's Advantage, a new long distance service available to our customers. We are very excited to offer you a single point of contact for your local and long distance service. U S WEST Communications has teamed up with Qwest Communications to provide you and your company long distance service.  x` `  hh@*** XxThere are no monthly fees, you will only have one bill your U S WEST Communications local phone bill, there is no monthly minimum, billing is accrued in 6 second increments after the initial 18 seconds of usage and we are currently waiving the carrier change charge of $5.00 per line.  x` `  hh@*** XxThank you for calling U S WEST Communications, your local, long distance and internet provider.   yO:%-Record of Proceeding at Tab 21, Declaration of Julia L. Parsons, Attachment B1 (last page of attachment).  As a result of this comprehensive marketing"1F,-(-(ZZa" campaign, the Buyer's Advantage program obtained at least 130,000 long distance subscribers  X-in less than one month.*GZm {Ob-ЍxSee AT&T and MCI Brief at 5 (citing Declaration of John A. McMaster at  38); see also Record of Proceeding at Tab 20 (U S WEST Opposition at 6) (stating that approximately 100,000 customers have signed up for this program).*  X-  II. PROCEDURAL BACKGROUND ĐTP  X- x17.` ` Shortly after Ameritech and U S WEST launched their respective programs, actions against them alleging the same substantive violations of the Act at issue here were filed in two federal district courts. On May 13, 1998, AT&T, MCI, ALTS, McLeodUSA, ICG, and GST filed a complaint against U S West in the United States District Court for the Western District of Washington, seeking "preliminary and final injunctive relief, and [ ]  X -damages, for U S West's violation of sections 251(g) and 271 of the [Act]."H m {O-ЍxAT&T Corp. et al. v. U S WEST Communications, Inc., No. C98643 (filed in W.D. Wash. May 13,  yO-1998) (U S WEST District Court Complaint). On May 14, 1998, AT&T, MCI, ALTS, McLeodUSA, Focal Communications Corporation, KMC Telecom II, Inc., and NEXTLINK Communications, Inc. filed a complaint against Ameritech in the United States District Court for the Northern District of Illinois, also seeking "preliminary and final injunctive relief, and damages, for Ameritech's threatened or actual violation of sections  X -251(g) and 271."I Dm yO-ЍxAT&T Corp. v. Ameritech Corp., No. 98 C 2993, at 2 (filed May 14, 1998) (Ameritech District Court Complaint). This Commission filed amicus briefs in both proceedings, seeking  X-referrals under the doctrine of primary jurisdiction.WJm {O-ЍxMemorandum of the Federal Communications Commission as Amicus Curiae in Support of Primary Jurisdiction Referral, AT&T v. U S WEST (May 29, 1998); Memorandum of Federal Communications Commission as Amicus Curiae in Support of Primary Jurisdiction Referral, AT&T v. Ameritech (June 5, 1998). The doctrine of primary jurisdiction is typically invoked when the enforcement of a claim, which is cognizable in  {O-the courts, requires the resolution of issues that are within the special competence of an administrative body. See  {O-WATS Int'l Corp. v. Group Long Distance (USA), Inc., 11 FCC Rcd 3720, 3722 n.12 (1997) (citing Western  {O-Union Telephone Co. v. Graphic Scanning Corp., 360 F. Supp. 593, 595 (S.D.N.Y. 1973)).W  Xb- x18.` ` The Washington district court subsequently referred the questions raised in the complaint before it to the Commission, stating that determinations to be made under sections 251 and 271 of the Act concern issues of communications policy that should be considered by the Commission "in the interests of a uniform and expert administration of a regulatory  X-scheme laid down by the [Act]."DK^m {O$-ԍxAT&T Corp. v. U S WEST Communications, Inc., Order Granting Preliminary Injunction, Referring  {Oe%-Legality Issue to FCC, and Staying Proceedings, No. C98634WD, slip op. at 4 (W.D. Wash. June 4, 1998) (U S  {O/&-WEST Referral Order).D The Washington district court also issued a preliminary injunction, stating that "while it is neither possible nor desirable to decide the merits at this" K,-(-(ZZ" stage, the court finds on both claims the plaintiffs have shown serious questions going to the  X-merits and a balance of hardships 'tipping sharply in their favor.'"HLm {Ob-ԍXxId. at 3.(#H Additionally, the court noted that the legality of the teaming agreement should be decided before the program takes  X-over a greater share of the market.CMZm {O-ԍXxId. (#C The Illinois district court also referred the proceeding to the Commission. It declined to grant the plaintiffs' request for preliminary injunctive relief, however, stating that "the FCC has the authority to issue interim injunctive relief" and that it  Xv-would be inappropriate to comment on the merits of a case referred to the Commission.Nvm {O -ԍxAT&T Corp. v. Ameritech Corp., No. 98 C 2993, slip op. at 1011 (N.D. Ill. June 10, 1998) (Ameritech  {O -Referral Order).  XH- x19.` ` Following the primary jurisdiction referrals, the Commission, by Public Notice, concluded that expedited resolution of the issues referred would best be achieved "in the  X -context of formal complaint proceedings pursuant to section 208 of the Act."O$ Hm {O-ԍxProcedures Established for Resolution of Primary Jurisdiction Referrals by the U.S. District Court for the Western District of Washington in AT&T Corp. v. U S WEST Communications, Inc., and by the U.S. District  {O-Court for the Northern District of Illinois in AT&T Corp. v. Ameritech Corp., DA 981109 at 1 (rel. June 11, 1998). On June 15,  X -1998, pursuant to that Public Notice, AT&T and other complainantsP 4 m yO-ԍxJoining AT&T in its complaint against Ameritech are MCI, ALTS, MGC, Time Warner, and NEXTLINK. filed a consolidated formal complaint against Ameritech, alleging that the CompleteAccess program violates  X -sections 271 and 251(g).XQ m yO-ԍXx47 U.S.C.  271, 251(g).(#X The AT&T complainants also sought an interim standstill order and preliminary injunction to prohibit Ameritech from further marketing, promoting, or  X -subscribing additional customers under its business arrangement with Qwest.uR m {Ot-ԍxAT&T Complaint (Ameritech) at 17; see also AT&T and MCI Brief.u The Commission granted the AT&T complainants' motion for interim relief on June 30, 1998, thereby requiring Ameritech to refrain from marketing or obtaining new customers for its  Xb-CompleteAccess program for a period of 90 days.Sbm {O!-ԍxSee AT&T Corp. v. Ameritech Corp., Memorandum Opinion and Order, FCC 98141 (rel. June 30,  {O"-1998) (Standstill Order). On June 16, 1998, AT&T and others filed a consolidated formal complaint against U S WEST, alleging that the Buyer's Advantage  X4-program also violates sections 271 and 251(g).T4 m yO%-ԍxAT&T Complaint (U S WEST). Joining AT&T in its complaint against U S WEST are MCI, ALTS, and NEXTLINK Washington, L.L.C. On June 19, 1998, McLeodUSA and others"4bT,-(-(ZZ" also filed a consolidated formal complaint against U S WEST, alleging the same violations as  X-in AT&T's complaint against U S WEST.UP m yOb-ԍxMcLeodUSA Complaint (U S WEST). Joining McLeodUSA in its complaint against U S WEST are ICG and GST. McLeodUSA also filed a complaint against Ameritech alleging that its business arrangement with Qwest violates sections 271 and 251(g). Resolution of both of McLeodUSA's formal complaints were deferred  yO-until further notice on June 23, 1998. Letter from Kurt A. Schroeder, FCC, to Richard M. Rindler, Counsel for McLeodUSA (dated June 23, 1998). xIn a related matter, on June 11, 1998, Ameritech and U S WEST each filed a petition for declaratory ruling seeking a Commission determination that its business arrangement with Qwest is lawful. Previously, Sprint Communications Corp. had filed a petition for declaratory ruling that the business arrangement  {Oj -contemplated in Ameritech's RFP was unlawful under sections 271 and 251(g). Pleading Cycle Established for  {O4 -Comments on Sprint's Petition for Declaratory Ruling Regarding Ameritech RFP Practices, Public Notice, CC Docket No. 9862, DA 98849 (rel. May 5, 1998). The Common Carrier Bureau (Bureau) consolidated Sprint's petition for declaratory ruling with the Ameritech and U S WEST petitions, noting that the issues raised therein  {O -are substantially similar. Change in Ex Parte Treatment of Sprint's Petition for Declaratory Ruling Regarding Ameritech RFP Practices, Common Carrier Bureau Consolidates Ameritech's and U S WEST's Petitions for  {O -Declaratory Ruling into Single Proceeding with Sprint's Petition for Declaratory Ruling, Public Notice, CC Docket No. 9862, DA 981183 (rel. June 18, 1998). Resolution of that proceeding is still pending.  X- x20.` ` Complainants seek: (1) a ruling that Ameritech and U S WEST have "provided" interLATA services in violation of section 271; (2) a declaratory ruling that Ameritech and U S WEST may not endorse or otherwise market the inregion, interLATA services of Qwest or any other carrier until Ameritech and U S WEST have obtained permission to provide inregion, interLATA services pursuant to section 271 of the Act; (3) a ruling that, by endorsing or otherwise marketing Qwest's interLATA services, Ameritech and U S WEST have discriminated among long distance carriers in violation of section 251(g) of the Act; and (4) a declaratory ruling that section 251(g) prohibits Ameritech and U S WEST  X -from endorsing or otherwise marketing interLATA services of Qwest or another carrier.V m yO-ԍxAT&T Complaint (Ameritech) at 1718; AT&T Complaint (U S WEST) at 1517. Complainant McLeodUSA asks that the Commission "declare [the Buyer's Advantage] arrangement illegal, order U S WEST to immediately cease and desist from its activities under the [arrangement], and direct that U S WEST not enter into a similar [arrangement]  X -without first meeting the requirements under the 1996 Act."dW pm yO-ԍXxMcLeodUSA Complaint (U S WEST) at 16.(#d  Xy-x21. ` ` On June 17, 1998, Qwest filed motions "to intervene in support of the defendant" in both of the proceedings filed by the AT&T complainants, and sought additional  XK-time beyond that granted to Ameritech and U S WEST to file its answer in each proceeding.GXXKm yO$-ЍxQwest Motion for Leave to Intervene in Support of the Defendant in AT&T Complaint, File No. E9841 (filed June 17, 1998) (Ameritech); Qwest Motion for Leave to Intervene in Support of the Defendant in AT&T Complaint, File No. E9842 (filed June 17, 1998) (U S WEST).G "K X,-(-(ZZ " On June 18, 1998, the Formal Complaints and Investigations Branch (Branch) granted Qwest's motions, in part, allowing Qwest to file the same pleadings as the defendants, but requiring that such pleadings be filed in accordance with schedules applicable to Ameritech  X-and U S WEST.YFm yO4-ЍxLetter from Diane Griffin Harmon, FCC, to Roy E. Hoffinger, AT&T Corp., Lisa B. Smith, MCI Telecommunications Corp., Richard J. Metzger, ALTS, Kent F. Heyman, MGC Communications Inc., Thomas Jones, Counsel for Time Warner Communications Holdings, Inc., Cathey Massey, Counsel for NEXTLINK, John T. Lenahan, Counsel for Ameritech, William R. Richardson, Jr., Counsel for U S West, Charles H. Kennedy, Counsel for Qwest (dated June 18, 1998). The pleading schedules were set forth in two Public Notices issued by  {O -the Common Carrier Bureau. Pleading Cycle Established for AT&T Corp. et al. v. Ameritech Corporation, File  {O -No. E9841, DA 981164 (rel. June 16, 1998); Pleading Cycle Established for AT&T Corp. et al. v. U S WEST  {O -Communications, Inc., File No. E9842, DA 981188 (rel. June 18, 1998).  X-x22. ` ` On June 24, 1998, AT&T Corp. et al. and McLeodUSA filed a joint motion to consolidate the proceedings against U S WEST. On June 25, 1998, the Branch granted the  Xa-joint motion, thereby reversing the deferral status accorded to that proceeding,IZam {O-ԍxSee supra note 86.I stating that to do so would promote economy by facilitating the Commission in resolving these identical  X3-issues in one proceeding.[3h m {OL-ԍxConsolidated Order, DA 981252, File Nos. E9842 and E9843 (CCB Enforcement Div. June 25, 1998). McLeodUSA did not seek to consolidate its formal complaint against Ameritech with the AT&T complainants' formal complaint against Ameritech; that proceeding, File No. 9844, remains in deferral status.  X -x23. ` ` On August 12, 1998, a status conference was held with the parties to the three  X -complaints.X\ m {O3-ԍxSee Status Conference Transcript.X At the status conference all parties were provided an opportunity to present their arguments orally and Commission staff directed questions regarding the underlying facts  X-and the parties' legal arguments.:]T m {O-ԍxId.: .KJ:\WPDOCS\HARMON\QWESTDFT\INTROBAC.FIN.  X{- -J:\WPDOCS\HARMON\QWESTDFT\DISC271.FIN- HIII. DISCUSSIONTP  X6-A.x STATFRAM Section 271  X-x 1.` ` Scope of the Prohibition on Providing InterLATA Service  X-x24.` `  STATFRAM Statutory Context and History . Section 271(a) states that neither a BOC nor  X-Ha BOC affiliate "may provide interLATA services except as provided in [section 271]."G^m yOZ'-ԍx47 U.S.C.  271(a).G "v^,-(-(ZZ" Generally, under section 271(b)(1), a BOC or a BOC affiliate "may provide interLATA services originating in any of its inregion States" only "if the Commission approves the  X-application of such company for such state under [section 271(d)(3)]."J_m {OK-ԍxId.  271(b)(1).J Neither Ameritech  X-nor U S WEST has been granted such approval.Z`Zm {O-ԍxSee supra note MICHAPP35.Z Accordingly, our consideration of whether Ameritech's and U S WEST's respective arrangements with Qwest violate section 271(a) requires that we look to the provision's scope and determine the nature of the activities that Congress intended be prohibited through its restriction that no BOC or BOC affiliate "may  X_-provide interLATA services except as provided in [section 271]."Xa_m yO -ԍx47 U.S.C.  271(a) (emphasis added).X  X3-x25.` ` The parties argue that the restriction contained in section 271 is clear. Not surprisingly, however, they suggest opposite "plain meaning" interpretations. Complainants contend that the term "provide" generally means to "make available," and, consequently, urge us to interpret the restriction broadly to encompass a wide range of activities, including  X -"simply marketing" interLATA services. b |m yO-ԍxAT&T and MCI Reply Brief at 30 (citing Random House Unabridged Dictionary 1556 (2d ed.  yO-1993) (defining "provide" to mean, among other things, to "make available" or "arrange for")).  As support, complainants rely on MFJ precedent,  X -which appears to equate "marketing" with "providing."gc m yOE-ԍxAT&T and MCI Brief at 2527. In one case cited by the complainants, the Department of Justice  {O -argued that, when the court modified the AT&T Consent Decree to permit the BOCs to "'provide' CPE . . . the  {O-Court may have intended to allow them some limited role in the design and development of CPE." United States  {O-v. Western Electric Co., 675 F. Supp. 655, 665 (D.D.C. 1987) (emphasis added). The court, however, rejected this contention, reasoning that the term "'provide or 'provision' was to be synonymous with marketing or  {O3-selling." Id. at 666 & n.46. The court observed that such an interpretation was necessary to ensure that the term "provide" as used in section VIII(A) was consistent with the use of that term in the remainder of the MFJ,  {O-including section II(D)'s restriction on BOC provision of interexchange services. Id. The complainants also cite  {O-United States v. American Telephone and Telegraph Co., Civil Action No. 820192 (filed Apr. 11, 1985), wherein the court decided, among other things, that a BOC violated section II(D)(2) of the AT&T Consent Decree, which provides that "no [BOC] shall provide telecommunications products," by selling an unaffiliated entity's switching equipment to an unaffiliated long distance service provider. According to the complainants, by enacting section 271, Congress obviously intended to restrict the BOCs from engaging in some of the same functions and activities that had been prohibited under the MFJ, including marketing. As support, the  {OA!-complainants rely on Lorillard v. Pons, 434 U.S. 575, 581 (1978), in which the Supreme Court held that it is appropriate to presume that Congress was aware of and incorporated prior judicial interpretations where it "exhibited both a detailed knowledge of the [prior] provisions and their judicial interpretation" and departed from those provisions "regarded as undesirable or inappropriate for incorporation."g They also cite the 1996 Act's legislative history, which uses the term "offer" in place of "provide," as evidence that" c,-(-(ZZ "  X-Congress intended for "provide" to be construed broadly.d"m yOy-ԍxAT&T and MCI Brief at 28 (citing Joint Explanatory Statement at 147). The Joint Explanatory  {OA-Statement states that section 271 is intended to prohibit a BOC from "offering interLATA service within its region" prior to obtaining authorization from the Commission. Joint Explanatory Statement at 147 (emphasis added). In addition, the complainants contend that the structure of the Act establishes that, when Congress used the term "provide" in setting forth a restriction, it intended to prohibit a wide range of activities, including  X-marketing.e m yO -ԍxComplainants argue that, throughout the Act, Congress used the term "marketing" when it intended to restrict only marketing activities and used the term "provide" to prohibit the full range of activities that the term "provide" encompasses, including marketing. AT&T and MCI Reply Brief at 31 (citing 47 U.S.C.  271(e)(1), 272(g), and 271(a)).  X-x26.` ` Defendants argue, conversely, that the restriction in section 271 must be narrowly construed. Specifically, defendants assert that the plain meaning of the term "provide" is to "furnish," which they contend restricts BOCs only to the extent they actually transmit, or act as a reseller of, interLATA services, prior to receiving requisite 271  X1-approval.f 1m yO|-ԍxThe defendants argue that the only carriers that "provide" interLATA services within the meaning of section 271 are those that have a legal or contractual obligation to "furnish" interLATA services upon request. The defendants claim that this obligation extends only to carriers who transmit or resell interLATA services. Ameritech Brief at 4246; U S WEST Answer at 4445. According to the defendants, any other activity, particularly their "mere  X -marketing" of interLATA service, is permissible under the Act.dg m yOM-ԍxAmeritech Brief at 4250; U S WEST Answer at 4445.d Defendants further claim that, as a matter of statutory construction, the term "provide" cannot be read more broadly to include "marketing" because, throughout the Act, these terms are used separately and, they  X -contend, deliberately to address different boundaries of permitted and restricted conduct.h m yO-ԍxAmeritech Brief at 4244 (citing 47 U.S.C.  251(c)(2)(6) ("provide"), 260(a) ("provides"), 271(a) ("provide"), 271(e)(1) ("market"), 272(g)(1)(3) ("market" and "marketing")); U S WEST Answer at 4748.  They argue that, if Congress intended the terms to have synonymous meaning, there would have been no need to use both terms together in the same statute. Indeed, defendants maintain that, under established principles of statutory construction, we are required to give  Xy-these terms different meanings.iyjm {O!-ԍxAmeritech Brief at 43 (citing Transbrasil S.A. Lineas Aereas v. Department of Transportation, 791 F.2d 202, 205 (D.C. Cir. 1986)); U S WEST Answer at 48. Finally, defendants point to two Commission orders in  Xb-which, they argue, the Commission has distinguished the term "provide" from "marketing."j&Hbm {O$-ԍxAmeritech and U S WEST cite to the Alarm Monitoring Order and the NonAccounting Safeguards  {O%-Order. In the Alarm Monitoring Order, the Commission concluded that a marketing arrangement between a BOC and an unaffiliated alarm monitoring service provider, under which a BOC would market the latter's alarm  {O3'-monitoring services, does not necessarily constitute the "provision" of alarm monitoring services by the BOC. In"3'i,-(-(\'" the Matter of Implementation of the Telecommunications Act of 1996: Telemessaging, Electronic Publishing, and  {OX-Alarm Monitoring Services, CC Docket No. 96152, Second Report and Order, 12 FCC Rcd 3824 (1997) (Alarm  {O"-Monitoring Order). Ameritech and U S WEST contend that the Commission implicitly recognized in the Non {O-Accounting Safeguards Order that section 271 does not prohibit the BOCs from entering into teaming arrangements with unaffiliated long distance service providers, prior to section 271 authorization, by stating that section 272(g)(2) "is silent with respect to the question of whether a BOC may align itself with an unaffiliated entity" to market interLATA services prior to section 271 authorization. Ameritech Brief at 47; U S WEST  {O-Answer at 4849 (citing NonAccounting Safeguards Order, 11 FCC Rcd at 22047)."bj,-(-(ZZ"Ԍ X-ԙx27.` ` Although we agree that Congress used the term "provide" to identify the scope of the section 271 restriction, we reject the parties' assertions that its meaning is clear and unambiguous. The Act does not define the term "provide," and we find the parties' attempts to use dictionary definitions to support their conclusions unilluminating and incomplete.  X-Rather, the term "provide" can, depending on its context, mean a variety of things.TkXm yO- -ԍxWe independently note that The American Heritage College Dictionary defines provide, among  yO -other things, as, alternatively, "to furnish; supply" or "to make available; afford."  The American Heritage  yO-College Dictionary 1102 (3rd ed. 1993).T It can support a narrow meaning, such as when used to convey the transmission of service. It can also mean something broader such as "make available." The fact that the term "provide" in the abstract can support any number of meanings confirms our view that we must look  XH-elsewhere to determine its precise scope under section 271(a).8lH m yO-ԍxAs the D.C. Circuit recently noted, in reversing the Commission's interpretation of the term "alarm monitoring service entity," the sole reliance on a dictionary definition to find plain meaning "reflects no consideration of other possible interpretations, no assessment of statutory objectives, no weighing of  {OI-congressional policy, no application of expertise in telecommunications." Alarm Monitoring Communications  {O-Committee v. FCC, 131 F.3d 1066, 1069 (D.C. Cir. 1997).8 As the D.C. Circuit recently noted, "[t]he literal language of a provision taken out of context cannot provide conclusive proof of congressional intent, any more than a word can have meaning without context to  X -illuminate its use."m& m {O`-ԍxBell Atlantic Telephone Companies v. FCC, 131 F.3d 1044, 1047 (D.C. Cir. 1997). We note that the court in this case used the term "deliver" as synonymous with the term "provide" when, in describing the section  {O-271 restriction, the court stated that, under section 271(a), "a BOC may not deliver interLATA services not  {O-authorized therein." Id. at 1046 (emphasis added).  X -x28.` ` We conclude that, in the context of our interpretation of section 271(a), the term "provide" is ambiguous. Accordingly, using the traditional tools of statutory construction, we look next to the context in which the term is used and any relevant  X-legislative history to determine a reasonable meaning.nm {O#-ԍxSee id. at 1047; Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843 n.9 (1984). Contrary to the defendants'  Xy-contentions, this approach is fully consistent with the Commission's analysis in the Ameritech  Xd-Michigan 271 Order and the Alarm Monitoring Order, interpreting, in different contexts, the term "provide" and the phrase "engaged in the provision of." The Commission in both the"On,-(-(ZZ+"  X-Ameritech Michigan 271 Order and the Alarm Monitoring Order generally recognized, as we do again here, that the term "provide" is inherently ambiguous and that we must, therefore,  X-consider the statutory context in which the term is used to give it precise meaning.(o\m {OM-ԍxIn the Ameritech Michigan 271 Order, the Commission determined that the term "provide" is commonly  {O-understood to mean both "furnish" and "make available." Ameritech Michigan 271 Order, 12 FCC Rcd at 2060102.( We, therefore, disagree with defendants that the specific interpretations of the term "provide" in these orders are controlling here. Rather, because they involve different statutory contexts,  X-simply importing the definitions the Commission adopted in the Ameritech Michigan 271  Xz-Order or the Alarm Monitoring Order would be contrary to the Commission's approach in those orders to giving meaning to the term "provide."  X7-x29.` ` In the Ameritech Michigan 271 Order, the Commission interpreted the term "provide" within the context of section 271(d)(3)(A)(i), which requires a BOC to demonstrate that it is "providing" access and interconnection pursuant to the terms of the competitive  X -checklist.p" m yO-ԍxBefore the Commission may grant a BOC's application to provide inregion, interLATA services, the Commission must determine, among other things, that the BOC has met the requirements of section 271(c)(1)(a)  {O!-and, "with respect to access and interconnection provided pursuant to [section 271 (c)(1)(A)], has fully  yO-implemented the competitive checklist in [section 271 (c)(2)(B)]." 47 U.S.C.  271(d)(3)(A)(i). In this context, the Commission concluded that a BOC "provides" a checklist item if it "actually furnishes" the item or, where no carrier is using the item, if the BOC  X -makes it available "as both a legal and practical matter."lq m {OM-ԍxAmeritech Michigan 271 Order, 12 FCC Rcd at 2060102.l Recognizing that the term "provide" is used in section 271(d)(3)(A)(i) to describe an affirmative obligation to provide checklist items, the Commission declined to construe the term broadly and, instead, determined that, in order to satisfy section 271(d)(3)(A), a BOC must demonstrate, among other things, that it has "a concrete and specific legal obligation to furnish" checklist items upon request and that "it is presently ready to furnish each checklist item in the quantities that  X<-competitors may reasonably demand and at an acceptable level of quality."+r~<h m {OU-ԍxId. Notably, in the Ameritech Michigan 271 Order, the BOCs and IXCs each urged the Commission to adopt a meaning of the term "provide" that is the exact opposite of the meaning they urge us to adopt in this  {O-proceeding. In the Ameritech Michigan 271 Order, for example, the BOCs argued that the term "provide" should be broadly construed so that they could fulfill their obligation to provide checklist items either by actually  {Oy -furnishing the item or by making it available. Ameritech Michigan 271 Order 12 FCC Rcd at 2060001. The IXCs, on the other hand, argued that the term "provide" should be narrowly construed to require BOCs to  yO "-actually furnish checklist items.+ The Commission concluded that such an interpretation would ensure that a BOC is actually furnishing checklist items in a manner that enables competing carriers to effectively serve"r,-(-(ZZ" local exchange customers, and thereby further Congress' goal of facilitating competition in  X-the local exchange market.sZm yOb-ԍxSpecifically, the Commission noted that such an interpretation of section 271(d)(3)(A)(i) "further[ed] the Congressional purpose of maximizing the options available to new entrants, without foreclosing BOC long  {O-distance entry simply because . . . [the BOC's] competitors choose not to use all of the options." Id. at 20602.  X-x30.` ` In contrast to its use in section 271(d)(3)(A)(i), the term "provide" is used in sections 271(a) and (b) to describe a restriction or limitation on a BOC's ability to enter the inregion, interLATA market. The use of the term "provide" in such different contexts may reasonably require us to interpret the term differently in sections 271(d)(3)(A)(i) and sections  X_-271(a) and (b). Consistent with the Commission's analysis in the Ameritech Michigan 271  XJ-Order, for example, we interpret the term "provide" in sections 271(a) and (b) in view of the goals Congress sought to achieve by enacting these provisions. In particular, we find that the term "provide" must encompass activities that, if otherwise permitted, would undermine Congress' method of promoting both local and long distance competition by prohibiting BOCs from full participation in the long distance market until they have open their local markets to competition pursuant to section 271's competitive checklist. Such an analysis may reasonably require us to adopt an interpretation of the term "provide" in sections 271(a) and (b) that is more comprehensive than the definition adopted by the Commission in the  X-Ameritech Michigan 271 Order. Indeed, as we conclude herein, a BOC need not be legally or contractually responsible for furnishing interLATA services upon request in order to  Xh-engage in the kind of conduct that sections (a) and (b) seek to prohibit. 271SCOPE thm {O-ԍxSee infra  37 for a discussion of the scope of the inregion, interLATA restriction in section 271.  X:-x31.` ` In the Alarm Monitoring Order, the Commission did not expressly define what it meant to be "engag[ed] in the provision of" alarm monitoring services, but, instead, concluded that it would determine, on a casebycase basis, whether a BOC is engaged in the  X-provision of alarm monitoring services in contravention of section 275.eu|m {O$-ԍxAlarm Monitoring Order, 12 FCC Rcd at 384142.e The Commission stated that it would take into account a variety of factors in making this determination, including whether the terms and conditions of a sales agency and marketing arrangement between a BOC and an unaffiliated alarm monitoring service entity are made available to other alarm monitoring companies on a nondiscriminatory basis and whether the BOC's compensation under such an arrangement is tied to the unaffiliated firm's performance in  Xm-offering alarm monitoring services.:vmm {O,#-ԍxId.: We conclude in this Order, as did the Commission in  XV-the Alarm Monitoring Order, that, in determining what it means to "provide" interLATA service, we must consider factors that are particularly relevant in the context of section 271(a). Thus, if we limited our analysis of the scope of the inregion, interLATA restriction"*v,-(-(ZZ" to the factors the Commission deemed relevant in the context of section 275, we would not be  X-fulfilling our obligation to interpret the term "provide" in the particular context it is used.!wm yOb-ԍxWe note that the approach we adopt herein to determine the scope of the section 271 restriction is  {O*-consistent with the approach the Commission adopted in the Alarm Monitoring Order. Indeed, similar to the  {O-result reached in the Alarm Monitoring Order, we conclude below that the mere marketing of interLATA  {O-services does not necessarily constitute the provision of such services within the meaning of section 271. See  {O-infra  MEREMKTG50. We reached this conclusion, just as the Commission did in the Alarm Monitoring Order, by examining the totality of the circumstances, including the language, history, and purpose of the statute. !  X-x32.` ` Although we thus reject defendants' attempts to import as controlling here specific definitions or conclusions concerning the meaning of "provide," which were considered by the Commission in different statutory contexts, we agree with defendants that Congress' use of both the terms "market" and "provide" in different provisions of the 1996 Act provides guidance as a matter of statutory construction. Specifically, we are persuaded that this suggests Congress did not intend for the terms to be used synonymously. We find it  X1-significant that section 272(g)(2) states that: "[a] Bell operating company may not market or  X -sell interLATA service provided by an affiliate required by this section within any of its inregion States until such company is authorized to provide interLATA services in such State  X -under section 271(d)."[x Hm yO-ԍx47 U.S.C.  272(g)(2) (emphasis added).[ Since section 272(g)(2) thus expressly prohibits a BOC from  X -marketing long distance services prior to obtaining authorization under section 271(d), it is unlikely that Congress implicitly intended sections 271(a) and (b) to achieve the same result. As defendants correctly contend, under such an interpretation, BOCs and their affiliates would already be precluded from marketing interLATA services under sections 271(a) and (b) and, therefore, the restriction on marketing set forth in section 272(g)(2) would be superfluous. Moreover, we find some force to Ameritech's position that, if one became a "provider" by "simply marketing" another carrier's services, then those who merely market and sell interLATA services, such as telemarketers and cellular sales agents, could be considered to be  X#-"providing" such services.y"#m {O-ԍxAmeritech Brief at 42; see also U S WEST Answer at 45; see also infra  MEREMKTG50 for a discussion of what we understand constitutes "mere marketing." As addressed more fully below, because we ultimately conclude that the defendants would be doing much more than marketing Qwest's service, this finding does not end our inquiry into the lawfulness of the defendants' respective arrangements with Qwest.  X-x 33.` ` We do not agree with the defendants further, however, that our finding that the terms are not synonymous means that we must construe them as mutually exclusive, that is, as suggesting wholly different meanings. As discussed above, we believe the term "provide" can support multiple and related meanings. Nor do we accept the defendants' view that  X-section 272(g)(2) means that only BOC joint marketing of its own long distance affiliate is  X-restricted until after 271 approval, and that all other marketing arrangements with non Xo-affiliates must therefore be permissible under the Act. We furthermore reject the defendants'"o y,-(-(ZZ"  X-contention that the Commission suggested as much in the NonAccounting Safeguards  X-Order.^zm yOd-ԍxAmeritech Brief at 47; U S WEST Answer at 49.^ Instead, the Commission determined there that section 272(g) does not prohibit the BOCs, prior to section 271 authorization, from entering into teaming arrangements that involve the marketing of an unaffiliated entity's interLATA services. This conclusion was based on the Commission's determination that "section 272(g) only restricts the BOC's ability  X-to market and sell interLATA services 'provided by an affiliate required by [section 272]'" and in view of NYNEX's representation that teaming arrangements in which a BOC and an  Xe-unaffiliated entity would market their respective services were permitted by the MFJ.{ eXm {On -ԍxSee NonAccounting Safeguards Order, 11 FCC Rcd at 22047 (citing NYNEX Reply Comments at 15 {O8 -16). NYNEX argued in the NonAccounting Safeguards Order, that: "Nothing in the MFJ prohibited . . . and nothing in the Act prohibits, a BOC from entering into a teaming arrangement with an unaffiliated interLATA  {O -provider to market their respective services to the same customers, provided all applicable nondiscrimination  {O -requirements are satisfied and provided the BOC's activity under the particular teaming arrangement does not  {O^-amount to the provision of interLATA service by the BOC itself. NYNEX Reply Comments at 1516 filed in  {O(-NonAccounting Safeguards Order, CC Docket No. 96149 (internal citations omitted). As support, NYNEX  {O-cited a brief submitted by the Department of Justice in the Shared Tenant Services proceeding, in which the Department of Justice stated: "[T]here are a variety of ways, including 'teaming' arrangement,' for example, by  {O-which [a BOC] may participate in the provision of shared service arrangements by providing permitted products  {ON-and services which comprise elements of such arrangements." Id. (citing Response of the United States to Ameritech's Motion for Clarification and Waiver of the Decree Regarding the Provision of Shared  {O-Telecommunications and Other Services, June 29, 1984, p.10 n.8 filed in United States v. Western Elec., 627 F.  yO-Supp. 1090 (D.D.C. 1986). The Commission was not presented with, and did not address in that Order, whether an  X9-arrangement in which a BOC would market its own local services as well as an unaffiliated entity's long distance services was permissible under section 272(g) or any other provision of the Act, including section 271. Thus, neither the language of section 272(g)(2) nor the  X -Commission's decision in the NonAccounting Safeguards Order is dispositive of the issue squarely presented here whether, and the extent to which, a BOC can enter into arrangements with nonaffiliated entities to provide a package of services that includes another carrier's long distance service component, and market that package under the BOC's brand name.  Xn-x!34.` ` On this issue, we agree with the complainants that the relevant legislative history offers some general guidance. The history suggests that the restriction in section 271 should not be limited to prohibiting only the transmission or resale of interLATA service. Significantly, the Conference Report accompanying the final version of the 1996 Act states  X-that BOCs are required to obtain authorization from the Commission "prior to offering  X-interLATA services" in their regions.T|$m yO$-ԍxJoint Explanatory Statement at 147.T The term "offer" is also used in numerous floor statements referring to the inregion interLATA restriction found in section 271, although the"|,-(-(ZZr"  X-term "provide" is used in the final text of those sections of the Act.}&m {Oy-ԍxSee, e.g., id. ("[section 271(b)(2)] permits a BOC to offer outofregion services immediately after the  {OC-date of enactment") (emphasis added); see also id. at 152 (stating that the three year "sunset" period of the separate affiliate requirements under section 271 commences "on the date on which the BOC is authorized to  {O-offer interLATA services") (emphasis added). Ameritech contends that Congress' use of the term "offer" in the legislative history is meant only to establish that  X-"a BOC cannot offer to provide its own services (or those of its affiliate) before obtaining  X-Commission authorization."^~m yO$ -ԍxAmeritech Brief at 45 (emphasis in original).^ We disagree with this construction of the legislative history. We find nothing in the legislative history that suggests that Congress was using the term "offer" in this limited context or that we should recognize that Congress implicitly intended to use this limiting phrase. Rather, we find that Congress' interchangeable use of the terms "provide" and "offer" suggests that Congress understood the prohibition to be broader in scope than mere transmission.  X -x"35.` ` Statutory Purpose and Structure. Based on the context of the term "provide," along with the relevant legislative history, we can reasonably conclude that the  X -restriction contained in sections 271(a) and (b) neither prohibits nor permits all forms of marketing relationships. Although this information supplies us with some direction in defining the general parameters of the restriction, it is not sufficient on its own. Since neither the context of the statutory provision nor its legislative history is dispositive, we examine the statutory purpose and structure of section 271 to give meaning to the scope of the restriction.  Xf-x#36.` ` As discussed above, section 271 has two underlying objectives.{fFm {O]-ԍxSee generally Statutory Framework discussion, supra, part I.A.{ First, section 271 seeks to bring additional competition to the long distance market by offering the BOCs the potential opportunity to participate in that market. Second, by conditioning BOC entry into the inregion, interLATA market on whether the BOCs' local markets are open to competition, section 271 seeks to facilitate entry by new entrants into the BOCs' local exchange markets. Together, these objectives further the overall purpose of the Act, which is to make all telecommunications markets competitive by fundamentally changing the incentives for market entry and by eliminating remaining monopoly bottlenecks.  X-x$37.` `  271SCOPE Thus, in giving meaning to the scope of the inregion, interLATA restriction, we must consider the dual objectives of section 271, as well as the careful balance struck by Congress in the Act's overall structure and framework. In particular, in order to determine whether a BOC is providing interLATA service within the meaning of section 271, we must assess whether a BOC's involvement in the long distance market enables it to obtain competitive advantages, thereby reducing its incentive to cooperate in opening its local market to competition. In making this determination, we balance several factors, including, but not limited to, whether the BOC obtains material benefits (other than access charges) uniquely",-(-(ZZ<" associated with the ability to include a long distance component in a combined service offering, whether the BOC is effectively holding itself out as a provider of long distance service, and whether the BOC is performing activities and functions that are typically performed by those who are legally or contractually responsible for providing interLATA service to the public. In evaluating the BOC's actions, we consider the totality of its  X-involvement, rather than focus on any one particular activity.m yO-ԍxWe emphasize that the factors we consider here in assessing whether a BOC's involvement in the long distance market rises to the level of "provision" are not necessarily exhaustive. In particular, we make no determination here regarding the extent to which, after a BOC obtains section 271 authorization, we should consider such authorization in evaluating whether a BOC's involvement in a teaming, or other business, arrangement constitutes the "provision" of interLATA service.  X_-x 2.` ` Legality of CompleteAccess and Buyer's Advantage Programs (#`  X1-x%38.` ` We conclude, based on the totality of Ameritech's and U S WEST's involvement in the inregion, interLATA market, that they are providing inregion, interLATA services in violation of section 271. Consistent with our interpretation of the scope of the inregion, interLATA restriction, this conclusion is based on our determination that: (1) the inclusion of Qwest's long distance services in CompleteAccess and Buyer's Advantage enables the defendants to obtain material benefits uniquely associated with the ability of the BOCs to include a long distance component of service, including the ability to become a onestop shopping entity for local and long distance service, the opportunity to win back customers lost to intraLATA toll competitors, the opportunity to sell additional vertical features, and the opportunity to realize additional intraLATA toll and billing and collection revenue, before demonstrating that their local markets are open to competition; (2) the defendants are holding themselves out as providers of long distance services by marketing and selling, under a single brand name, Qwest's long distance services and their own local services and by performing various customer care functions in connection with the long distance services offered under CompleteAccess and Buyer's Advantage; (3) the defendants are performing various functions and activities under their business arrangements with Qwest that are typically performed by those who resell interLATA services, such as marketing, customer care, and establishing the prices, terms, and other conditions for the long distance services to be provided under their respective programs. We examine each of the foregoing factual circumstances more fully below.  XN-x&39.` ` In our view, one of the most significant factors in our determination that the defendants are providing inregion, interLATA services in violation of section 271 is that, by including Qwest's long distance services in their CompleteAccess and Buyer's Advantage programs, Ameritech and U S WEST each become a comprehensive "onestop shopping" source for local and long distance services when the defendants have not adequately opened their local markets and thus have not enabled new entrants to also compete in the combined services market. Although Congress contemplated that the framework it enacted would enable the BOCs to obtain the benefits associated with being a provider of long distance"!x,-(-(ZZ " services, such as the ability to offer onestop shopping, we do not find that Congress intended for the BOCs to obtain these benefits, prior to demonstrating compliance with the market opening provisions in section 271. Indeed, Congress held out the possibility of the BOCs being able to participate in the long distance market as a critically important incentive for the BOCs to cooperate in opening their local markets to competition. By conditioning BOC entry into the inregion, interLATA market on whether the local market is open to competition, Congress sought to ensure that, when the BOCs obtain authorization to provide long distance services, and thereby offer onestop shopping, new entrants would also have the opportunity to provide a combined package of telecommunications services to consumers. In order to ensure that this carefully balanced incentive structure remains intact, we interpret section 271 as prohibiting the BOCs from obtaining the benefits uniquely associated with being able to participate in the long distance market, prior to demonstrating compliance with section 271.  X -x'40.` ` We need not speculate upon the extent to which BOCs would receive benefits uniquely associated with the fact that the package of services they offer their inregion customers includes a long distance component, as opposed to other services, prior to section 271 authorization. Indeed, the defendants themselves acknowledge that such benefits take many forms. First, the ability presently to be the sole provider of a package of services that includes a long distance component affords these BOCs, prior to their receiving section 271 approval, an enormous benefit in strengthening their position in the telecommunications marketplace. Indeed, Ameritech expressly recognized that its business arrangement with  X-Qwest would give it what it termed a "first mover's advantage."m yO-ԍxAlcott Interim Relief Declaration at Exhibit C, AM 00930 (Project Pathfinder Briefing, Weekend Draft). More specifically, Ameritech reasoned that a combined service offering would enable it to "build an entrenched full service base" before the three major interexchange carriers could "leverage their customer  X-relationship to sell local."Xm {O-ԍxSee e.g., id.; id. at Exhibit D, AM 06332 (Project Pathfinder Briefing). Similarly, in announcing the Buyer's Advantage program, U S WEST expressly recognized that its arrangement with Qwest "is about serving the customer  X-and bringing them closer to onestop shopping, which they are demanding."m {OE-ԍxEconomy, U S WEST Strikes Marketing Alliance with Qwest in Bold Move Skirting Rules, Wall St. J., May 7, 1998, at A2 (Statement of Solomon Trujillo, President of U S WEST Communications Group). U S WEST further stated in its marketing plans that "[its] endeavor with Qwest will initially allow [it] to  X|-become an interLATA carrier" for its inregion subscribers.@|Dm yOq!-ԍxRecord of Proceeding (U S WEST) at Tab 39, Appendix 10, Q00520. Moreover, we agree with AT&T that a decision to permit the BOCs to compete here effectively transforms the market "from one in which long distance carriers compete with each other for the favor of customers into one in which [long distance carriers] compete for the favor of the BOC, to be its chosen ally and to get preferential access to that channel rather than aggressively competing against the BOC." Status Conference Transcript at 13 (Keisler Testimony).@  XN-x(41.` ` Second, the defendants' ability to provide a combined offering of local and long distance services, prior to demonstrating that their local markets are open to competition,"7 ,-(-(ZZ" affords them a significant "jumpstart" when they do obtain 271 authorization. U S WEST acknowledges, for example, that a combined local and long distance offering would afford it a means to "[p]reposition customers for U S WEST Long Distance by providing the  X-convenience of onestop shopping."zm yO4-ԍxRecording of Proceeding (U S WEST) at Tab 39, Appendix 6, Q00392, Q00393.z Indeed, through their branding of the combined offering, both Ameritech and U S WEST are well poised to substitute the long distance service offered by their section 272 affiliate, when they obtain section 271 approval, into the CompleteAccess or Buyer's Advantage package in the future.  XH-x)42.` ` Third, the defendants expressly concede that a key benefit associated with being able to provide a combined service offering is the opportunity to strengthen and entrench their relationships with their inregion local customers. Ameritech has stated, for example, that the CompleteAccess program enables it to better satisfy those customers "who want simplicity and convenience" and, at the same time, "enhance its own goodwill in the  X -marketplace."H Xm yO-ԍxAmeritech Brief at 23.H U S WEST described Buyer's Advantage as "a marketing tool and . . . a  X -way of adding value when [it] deal[s] with [its] customers."m m yOW-ԍxStatus Conference Transcript at 6566 (Abernathy Testimony).m More precisely, U S WEST  X -testified that Buyer's Advantage enables it to "keep [its] customers happy."b xm {O-ԍxId. See also U S WEST Answer at 56.b We recognize that a competitive environment demands that carriers strive to satisfy their customers' needs. Indeed, one of the main benefits of competition is that customers' desires are satisfied more effectively. In our view, however, Congress did not intend to permit the BOCs to enhance their relationships with their local customers by offering a telecommunications package that includes long distance services in a way that violates section 271.  X-x*43.` ` Finally, the defendants acknowledge that they will derive material financial benefits from each sale of CompleteAccess and Buyer's Advantage. Ameritech states, for example, that "by responding to customers' needs and desires, [it] hopes to more effectively  X-market, and hence increase its sales of, its own local services, especially 'vertical services' such as Call Waiting, Caller ID, and Automatic Redial, which offer a higher profit margin  X-than basic local service."F m yOP!-ԍxAmeritech Brief at 3.F Ameritech further admits that vertical features will "market better  X~-in combination with the . . . CompleteAccess offer."~m yO#-ԍxBriskman Interim Relief Declaration at Exhibit 16, 14647 (Deposition of Neil Briskman). U S WEST has stated that Buyer's  Xg-Advantage will enable it to "[target] high value customers for retention, winback and competitive response reasons . . ." and "[i]mprove U S WEST value proposition in its toll markets by 'packaging' competitive intraLATA calling plans with a compelling long distance"9* ,-(-(ZZ"  X-offer."om yOy-ԍxRecord of Proceeding (U S WEST) at Tab 39, Appendix 6, Q00392.o Under these particular agreements, the BOCs also realize additional intraLATA toll  X-and billing and collection revenue.tBXm yO-ԍxWe further note that Ameritech has testified that its billing and collection agreement with Qwest differs from its agreements with other IXCs in that: (1) startup costs are not being directly recouped under the billing and collection agreement but are recouped as part of the marketing copayment; (2) Ameritech does not require Qwest to meet the minimum use levels that it ordinarily requires; (3) Ameritech sets the initial "baddebt" at 5% pending trueup, whereas in other agreements, this amount is ordinarily set at 10%; and (4) Qwest's billing and collection agreement with Ameritech last for two years, whereas other such agreements normally last for one  {O -year. Briskman Interim Relief Declaration at Exhibit 16, 14950 (Deposition of Neil Briskman). See also AmeritechQwest Teaming Agreement at 2.t U S WEST has testified, for example, that Buyer's Advantage is designed both to "win back" customers who have been lost to intraLATA toll  X-competitors, such as AT&T and MCI, and to prevent further losses to these carriers.Jb m yO -ԍxU S WEST Answer at 4445.J Ameritech has similarly testified that its CompleteAccess program will enable it to regain customers who have been lost to intraLATA toll competitors but who are attracted to a one Xv-stop shopping offer.v m yO-ԍxBriskman Interim Relief Declaration at Exhibit 16, 148 (Deposition of Neil Briskman). Moreover, the defendants' involvement in establishing the prices Qwest would charge for the long distance services offered under CompleteAccess and Buyer's Advantage was specifically designed to make these packages more profitable to the BOCs. Ameritech has conceded that: "[t]he better the price [for the long distance services offered  X -under CompleteAccess] the more we sell and the more money we make."i m yOM-ԍxStatus Conference Transcript at 68 (Phillips Testimony).i Thus, these arrangements demonstrate the significance of combined service offerings as a vehicle for the BOCs to maintain their preeminence in the intraLATA market and, ultimately, to compete aggressively in the intraLATA toll market. x  X -x+44. ` ` Thus, the defendants' business arrangements with Qwest enable them to compete prematurely in the inregion, interLATA market through the provision of onestop shopping, and to advance their position in the telecommunications marketplace, regardless of whether the defendants derive direct customer payments for the transmission of Qwest's long distance services. Indeed, the record indicates that, in the four weeks preceding the issuance of the preliminary injunction against the defendants, U S WEST successfully persuaded approximately 130,000 of its customers to purchase Qwest's long distance services under its  X-Buyer's Advantage program.Fm yO#-ԍxU S WEST Answer at 2.F And, even with limited inbound marketing calls, Ameritech successfully persuaded more than 10,000 customers to subscribe to Qwest's long distance  X-services offered under its CompleteAccess program.m yO+'-ԍxAT&T and MCI Brief at 2 (citing Deposition of Scott Alcott, attached as Exhibit at 24). Moreover, by expressly" 2,-(-(ZZ" acknowledging the competitive advantage that they would obtain over the major interexchange carriers by offering a onestop shopping solution to their inregion subscribers, prior to section 271 authorization, the BOCs have effectively conceded that they sought to compete with interexchange carriers for the provision of interLATA services. Congress expressly created in the statutory scheme, however, a framework for ensuring that the BOCs open their local markets before they may compete in the inregion, interLATA market.  X_-x,45.` ` A second critical factor is that, by offering onestop shopping for local and long distance services, under a single brand name, the defendants are effectively holding themselves out to customers as providers of long distance services. Most notably, the defendants have taken several specific steps to brand CompleteAccess and Buyer's Advantage as their exclusive combined service offerings. Under their contracts with Qwest, for example, the defendants have the exclusive right to market and sell Qwest's long distance services in conjunction with the marketing and sale of their own local services under the CompleteAccess  X -or Buyer's Advantage brand name." m yO7-ԍxBoth of the defendants' respective contracts with Qwest provide that, in order to be considered a customer of CompleteAccess or Buyer's Advantage, the customer must purchase Qwest's long distance services  {O-and at least one service provided by Ameritech or U S WEST. See generally Status Conference Transcript at 104110. In marketing and selling these combined offerings, the defendants expressly identify themselves as onestop shopping entities. For example, U S WEST's marketing scripts include statements, such as "U S WEST Communications has  Xy-teamed up with Qwest . . . to provide you and your company long distance service,"ym yO-ԍxRecord of Proceeding (U S WEST) at Tab 21, Appendix 4 (Declaration of Julia Parsons, Attachment B1) (emphasis added). "With  Xd-U S WEST Buyer's Advantage, Qwest and U S WEST are able to provide you with a one  XO-stop telecommunications solution,"O m {O -ԍxId. (Declaration of Julia Parsons, Attachment B3) (emphasis added). and "Thank you for calling U S WEST  X8-Communications, your local, long distance and internet provider."8m {O-ԍxId. (Declaration of Julia Parsons, Attachment B1) (emphasis added). Ameritech even sends a letter thanking customers for subscribing to CompleteAccess. In this letter, Ameritech explains the benefits of subscribing to CompleteAccess as including "the convenience of one customer service number to call and just one bill to pay for . . . local and long distance  X-services.". m yO!-ԍxAT&T and MCI Brief (Ameritech) at Exhibit 2 (Letter from Ameritech to CompleteAccess Subscribers). When customers dial the number referred to in the Ameritech letter, they will be connected to Ameritech, as Ameritech serves as the initial point of contact for customers who have questions or problems with any of the services purchased under CompleteAccess,  X-including the long distance services offered under the package.G m yO&-ԍxAmeritech Brief at 20.G By holding themselves out to consumers as being able to provide long distance service, under their exclusive brand"!N ,-(-(ZZP" name, the BOCs are competing in the inregion, interLATA marketplace before they are  USWSCRI authorized to enter this market.  X-x-46.` ` We are also persuaded by the fact that, in bringing the CompleteAccess and Buyer's Advantage onestop shopping offers to their inregion subscribers, the defendants engaged in various actions that are typically performed by those who resell interLATA  Xv-services.U\vm {O-ԍxSee generally Regulatory Policies Concerning Resale and Shared Use of Common Carrier Services and  {O-Facilities, Report and Order Docket No. 20097, 60 FCC 2d 261, 262 (1976), for a discussion of the kinds of activities that fall within the definition of "resale."U For example, the defendants had a significant degree of involvement in designing and developing the long distance component of their respective combined service offerings. Most notably, Ameritech and U S WEST selected Qwest as the provider of the long distance component of CompleteAccess and Buyer's Advantage on the basis of criteria Ameritech and  X -U S WEST established.D m yO-ԍxSpecifically, Ameritech and U S WEST each sought to enter into an arrangement in which they would exclusively market and sell, under the CompleteAccess or Buyer's Advantage brand name, their own local and intraLATA toll services and a long distance company's long distance services. Any carrier wishing to participate in such an arrangement would have to pay Ameritech and U S WEST a marketing fee, permit Ameritech and U S WEST to serve as the initial point of contact for customers subscribing to the defendants' programs, enter into  {O-a billing and collection agreement, and comply with certain network service and transport requirements. See  {Oi-Ameritech Request for Proposal Number PR00298; see also Briskman Interim Relief Declaration  5; see also  yO3-U S WEST Answer at 59.ė The defendants also had a role in establishing the prices at which Qwest would offer long distance services under CompleteAccess and Buyer's Advantage. Although the defendants both state that the rates set forth in their agreements with Qwest were negotiated, facts in the record indicate that Ameritech and U S WEST had structured, prior to entering into negotiations with Qwest, the prices at which long distance services should be offered under CompleteAccess and Buyer's Advantage in order to make these  X-combined service offerings most profitable to the BOCs.  m yO9-ԍxThe record indicates, for example, that Ameritech originally began negotiating with Frontier, an interexchange carrier. In so doing, Ameritech expressly told Frontier that it would have to meet certain price points: 15 cents per minute for peak residential service and 7 cents per minute for offpeak residential service. In a letter dated May 4, 1998, apparently to address Frontier's concerns that Ameritech's suggested pricing "may be perceived as 'predatory,'" Ameritech states: "[A]though we have reached our own conclusions on what price points will make this teaming offer successful, the choice of the prices that you are willing to offer is obviously yours." AT&T and MCI Brief at Exhibit 15, AM 00822 (Letter from Diane Primo, Ameritech, to Brian Fitzpatrick, Frontier, dated May 4, 1998). Ameritech went on to state in this same letter, however, that industry research confirmed that its suggested price points were consistent with "other aggressive account acquisition  {OA"-price points." Id. When negotiations with Frontier broke down, Ameritech began negotiating with Qwest. In its initial negotiations with Qwest, Ameritech suggested that Qwest offer long distance service under  {O#-CompleteAccess at the same rates it had proposed to Frontier, i.e., 7 and 15 cents per minute, respectively, for offpeak and peak residential service. In describing its negotiations with U S WEST, Qwest testified that: "[T]hey were looking for a consumer offer in the 10centaminute range. They were looking for a business offer in the 10 to 12centaminute range." Record of Proceeding (U S WEST) at Tab 39, Appendix 12 (Deposition of Michael Murphy). Evidence in the record further""D,-(-(ZZL" suggests that Qwest essentially agreed to join the arrangement under the defendants' terms  X-and conditions. m yOb-ԍxSimilar to the rates initially proposed by Ameritech, for example, the AmeritechQwest contract specifies that Qwest initially will charge CompleteAccess subscribers 7 cents per minute for offpeak residential service; 15 cents per minute for peak residential service; and 9.5 cents per minute for business service. AmeritechQwest Teaming Agreement  1.02. We further note that Ameritech concedes that Qwest had proposed prices that were higher than what Ameritech suggested but, as the contract reflects, Qwest will provide  {OJ-long distance services under CompleteAccess at the rates initially proposed by Ameritech. See Ameritech Brief at 6970 (citing Alcott Deposition at 106); AmeritechQwest Teaming Agreement  1.02. Qwest has further testified that its negotiations with Ameritech were "fast and furious," stating that "[w]henever someone like Ameritech says they're interested in doing business with you, you move quick." AT&T and MCI Reply Brief,  {Ol -Jacobsen Deposition at 308. Qwest further states that the negotiation period lasted only twentyfour hours. Id. Qwest testified that, in its initial negotiations with U S WEST, U S WEST outlined the general structure of the Buyer's Advantage offer, including the price points they were expecting. Qwest characterized its response to U S WEST's offer as: "Yeah, we think we can do that, and endorsing the notion and expressing an interest in moving ahead quickly, which eventually we did." Record of Proceeding (U S WEST) at Tab 39, Appendix 12  yOV-(Deposition of Michael Murphy). In short, the evidence strongly suggests that it is defendants, not Qwest, that established the prices and terms for the long distance services to be provided under CompleteAccess and Buyer's Advantage.  X-x.47.` ` We further note that these business arrangements effectively enable the defendants to exercise strong prospective influence over the prices, terms, and conditions of the long distance services provided under CompleteAccess and Buyer's Advantage. For example, Qwest may not increase its prices during the term of its agreement with U S  X1-WESTr1L m yO.-ԍxU S WEST Answer at 11; U S WESTQwest Teaming Agreement  2.3.r and may increase its prices under its agreement with Ameritech only after giving  X -Ameritech sixty days notice.] m yO-ԍxAmeritechQwest Teaming Agreement  1.03.] Notably, if Qwest does, in fact, raise its prices beyond those  X -specified in its agreement with Ameritech, Ameritech may terminate the contract.Q lm {O -ԍxId. Ameritech Brief at 15.Q Both contracts also contain several specific network and service requirements Qwest must meet in order to continue providing long distance service under CompleteAccess and Buyer's  X -Advantage.  m yOm -ԍxAmeritechQwest Teaming Agreement, Attach. A (describing the minimum network and service specifications Qwest must meet in order to continue providing long distance service under CompleteAccess); U S WESTQwest Teaming Agreement, Ex. B (describing the customer service and service standards with which Qwest must comply in order to continue providing long distance service under Buyer's Advantage). Ameritech may terminate its contract with Qwest if Qwest deviates from the "minimum network and operations specifications and requirements" set forth in the contract,  X-and such deviation "impacts Ameritech operations or its brand image or values."]m yO'&-ԍxAmeritechQwest Teaming Agreement  1.02.] U S"#v,-(-(ZZ" WEST reserves the right to terminate its contract with Qwest if Qwest "[f]ail[s] . . . to meet  X-the service standards set forth [in the contract]."^m yOb-ԍxU S WEST Teaming Agreement, Ex. B,  1(d).^  X-x/48.` ` The defendants also perform other functions and activities under their respective business arrangements with Qwest that are typically performed by resellers. For example, the defendants serve as the exclusive marketing and sales agents of CompleteAccess  Xv-and Buyer's Advantage.]vXm yO -ԍxAmeritech Brief at 21; U S WEST Answer at 7.] The defendants, therefore, seek to induce their inregion subscribers to select the long distance services offered by Qwest under CompleteAccess and Buyer's Advantage, rather than the services offered by a competing interLATA service provider. If a customer does, in fact, subscribe to CompleteAccess or Buyer's Advantage, he or she will primarily interface with the defendants, as the defendants serve as initial point of  X -contact for customers' billing and collection and service inquiries.a m yO-ԍxAmeritech Brief at 1920; U S WEST Answer at 13.a Qwest interacts with the customer only after Ameritech or U S WEST has determined that the customer's question or  X -concern relates to a problem in Qwest's long distance service network. xm yO-ԍxAmeritech Brief at 20 (citing Briskman Testimony  46); U S WEST Answer at 13. In addition, Ameritech requires Qwest to provide status and resolution information about any trouble ticket Ameritech refers to Qwest so that Ameritech can provide feedback to the enduser "as  X-necessary and appropriate."dm yOI-ԍxAmeritechQwest Teaming Agreement, Attach. A at 17.d Under the U S WESTQwest contract, Qwest is required to  Xy-provide U S WEST "with the status and disposition of its customer service activities."dym yO-ԍxU S WESTQwest Teaming Agreement, Ex. B,  1(d).d The only long distance function the defendants do not perform under their respective business arrangements is the actual transmission of calls across LATA boundaries; this function is performed by Qwest.  X-x049.` ` We further note that Ameritech's and U S WEST's business arrangements with Qwest enable them to provide the type of combined service offering that is prohibited to  X-certain interexchange carriers under section 271(e). In section 271(e), Congress prohibited large IXCs from entering the combined services market through the resale of the BOC's local service for three years, or until the BOCs could likewise enter the market through a long  X-distance affiliate after obtaining 271 approval.( m {Ol$-ԍ x47 U.S.C.  271(e)(1); see also supra note 271(E)(1)30.Ď This provision appears to have several objectives. First, it seeks to diminish the likelihood that the large IXCs would gain a "first mover's advantage" by merely reselling the BOC's local services as part of a combined service offering. Second, it acts to encourage the IXCs to become facilitiesbased providers"N$ ,-(-(ZZ0" of local services because the prohibition does not extend to IXCs that seek to provide a package of services that includes local services provisioned through the use of their own facilities. Third, it encourages the BOCs to act expeditiously to open the local market because the prohibition, unless nullified by a BOC's receipt of section 271 authorization, expires three years from the date of enactment. We cannot reasonably interpret section 271 as prohibiting IXCs, who lack monopoly power, from competing in the combined services market through the resale of the BOC's local services for three years, while permitting a BOC, who has not yet opened its local market to competition, to provide a similarly packaged combined service offering immediately.  X -x150.` `  MEREMKTG  MEREMKT Based on this factual record, we reject defendants' attempts to label the functions and activities they perform under their business arrangements with Qwest as "simply marketing" or "merely marketing." Although it is not clear what the defendants mean when they refer to such terms, we believe that an arrangement in which a BOC would offer the services of its marketing department to market and sell a long distance product or service would be one example of a permissible marketing arrangement. Provided the BOC would make no representation that such product or service is associated with its name or services, such an arrangement would be analogous to billing and collection arrangements and would be  Xb-permissible under section 271.R bm yO-ԍxWe recognize, as complainants argue, that the MFJ Court would have found the arrangements before us to be unlawful on the basis that the BOCs were prohibited under the Consent Decree from "marketing" or "selling" a product or service they were prohibited from "providing." 675 F.Supp. at 66566. For the reasons described above, however, we believe that the 1996 Act contemplates that certain business arrangements between BOCs and nonaffiliated long distance entities, that may include some marketing dimension, would be  {O-permissible. Accordingly, insofar as the Act supplants the MFJ in the "lineofbusiness" jurisprudence, see, e.g.,  {O-47 U.S.C.  601, we do not believe these cases are controlling here. As we concluded in the Ameritech  {OW-Michigan 271 Order, however, we find that the principles underlying MFJ case law, which identify the anticompetitive concerns associated with premature BOC entry into long distance prior to local markets being  {O-open are nevertheless instructive. Ameritech Michigan 271 Order, 12 FCC Rcd at 20553. In this regard, we agree with complainants that the MFJ cases further support our view that certain marketing arrangements can, in effect, permit BOCs to compete in the long distance market, and in so doing, reduce their incentive to bring  {OC-about free and fair competition in the local market. See, e.g., Shared Tenant Services, 627 F. Supp. 1090, 1099 (D.D.C. 1986) (noting that the Consent Decree prohibited the BOCs not only from providing interLATA transmissions but also from "engaging in activities that comprise the business of interexchange services," the MFJ court reasoned that the restriction was necessary "in order to prevent [the BOCs] from becoming competitors of the interexchange carriers"). The business arrangements Ameritech and U S WEST have entered into with Qwest are fundamentally different from this permissible type of marketing, as they involve marketing and selling, under a single brand name, their own local services and Qwest's long distance services. Moreover, the defendants do not just market their own local, and Qwest's long distance, services, under a single brand name, but they also perform various customer care functions in connection with the long distance services purchased under their respective programs. We further find that the defendants' business arrangements with Qwest are distinguishable from permissible marketing arrangements in view of Ameritech's and U S WEST's role in establishing the prices and other specific terms of the long distance"%,-(-(ZZ"  X-services provided under CompleteAccess and Buyer's Advantage.m yOy-ԍxIn this regard, we find persuasive the complainants' line of reasoning to distinguish Ameritech's and U S WEST's agreements with Qwest from marketing: XxAT&T has hired lots of telemarketing firms over the years and signed lots of marketing contracts. None of them has ever tried to tell us what price we should set. None of them has ever said they will terminate marketing for us if we raised our price. None of them has ever said they want to insert themselves as the customer interface after the customer signed up for the service.  Status Conference Transcript at 19 (Keisler Testimony). Indeed, in view of the nature and extent of the defendants' involvement in their respective onestop shopping programs and Qwest's limited, secondary role, we find that the defendants have effectively positioned themselves as the sole providers, rather than the mere marketers, of a package of services that includes a long distance component.  Xv-x251.` ` Finally, we reject Ameritech's contention that "[t]he public interest will be  X_-substantially impaired if its [contractual arrangement with Qwest] is enjoined."H_` m yOp-ԍxAmeritech Brief at 121.H To the contrary, we conclude that the public interest will be served by our finding that Ameritech's and U S WEST's premature entry into the long distance market is unlawful under section 271 because we are preserving the intent of Congress that local markets be opened to competition  X -before BOCs may enter into the long distance market. m {O-ԍxSee, e.g., U S WEST Referral Order. Upon finding, among other things, that the plaintiffs had raised "serious questions" concerning the legality of the U S WESTQwest business arrangement, the court concluded  {O6-that "U S WEST's argument that [its] teaming arrangements benefits consumers cannot prevail at this state." Id. at 34. In reaching this conclusion, the court noted that, "if the agreements violates [the Act], it will harm  {O-consumers' interests, as identified by Congress, because of its anticompetitive nature." Id. at 4. Moreover, our decision need not impact those customers who wish to subscribe to Qwest's long distance services at the same prices offered to CompleteAccess or Buyer's Advantage subscribers. They can simply subscribe to Qwest's long distance services directly, rather than through Ameritech or U S WEST.  Xy-x352.` ` In conclusion, based on the evidence presented and applied to our interpretation of the scope of the prohibition under section 271, we find that the defendants' business arrangements with Qwest permit Ameritech and U S WEST to provide inregion, interLATA services, prior to section 271 authorization. It is clear on this record that Ameritech's and U S WEST's business arrangements with Qwest pose the competitive concerns that section 271 seeks to address, and we accordingly find them unlawful under the Act. ->J:\WPDOCS\HARMON\QWESTDFT\DISC271.FIN- ׌ X- -J:\WPDOCS\HARMON\QWESTDFT\DISC251.FIN-    v  X- G%M  G%M B.XxSection 251(g) G%M(#  X-x453.` ` SECTION 251(G)The second issue presented by Ameritech's and U S WEST's marketing and recommending of Qwest's long distance service under the CompleteAccess and Buyer's  G%M v G%M Advantage programs is whether these arrangements comply with the equal access and  Xv-nondiscrimination requirements under section 251(g).4vm yO-ԍxSpecifically, section 251(g) of the Communications Act of 1934, as amended, provides, in pertinent part, that: Xxeach local exchange carrier, to the extent that it provides wireline services, shall provide exchange access, information access, and exchange services for such access to interexchange carriers . . . in accordance with the same equal access and nondiscriminatory interconnection restrictions and obligations . . . that apply to such carrier on the date immediately preceding the date of enactment of the Telecommunications Act of 1996 under any court order, consent decree, or regulation, order, or policy of the Commission until such restrictions and obligations are explicitly superseded by regulations prescribed by the Commission after such date of enactment. During the period beginning on such date of enactment and until such restrictions and obligations are so superseded, such restrictions and obligations shall be enforceable in the same manner as regulations of the Commission.  47 U.S.C.  251(g). This statutory language tracks section II(A) and section II(B) of the MFJ. Specifically, section II(A) required that each BOC "provide to all interexchange carriers and information service providers exchange access, information access, and exchange services for such access on an unbundled, tariffed basis, that  {O7-is equal in type, quality, and price to that provided to AT&T and its affiliates." United States v. AT&T, 552 F. Supp. at 227. Section II(B) of the Consent Decree further provided that "no BOC shall discriminate between AT&T and its affiliates and their products and services and other persons and their products and services in the . . . interconnection and use of the BOC's telecommunications service and facilities or in the charges for each  {OY-element of service . . . ." Id. Section 251(g) expressly preserves all preexisting equal access and nondiscrimination requirements that were established "under any court order, consent decree, or regulation, order or policy of the Commission" prior to passage of the 1996 Act until such restrictions are explicitly superseded by the  X -Commission.M m yO-ԍx47 U.S.C.  251(g).M Section 251(g) further affirmatively grants the Commission authority to prescribe regulations superseding these preexisting equal access and nondiscrimination  X -obligations.: Tm {O -ԍxId.: All parties here concede that the Commission has not yet issued any such superseding regulations, and that therefore the MFJ's equal access and nondiscrimination provisions and court orders interpreting those provisions are enforceable "as regulations of the  X -Commission." X  m yO>%-ԍxAlthough the MFJ and related judgments and orders rendered by the MFJ Court were replaced by the  yO&-1996 Act generally, the legislative history of section 251(g), like its express language, clearly indicates that Congress intended for the equal access and nondiscrimination requirements under the MFJ and the rules"&,-(-(&" promulgated by the Commission to remain in effect until superseding regulations are adopted. The Joint Explanatory Statement states that the Senate bill and the House amendments "assumed that the BOCs would continue to be required to provide equal access and nondiscrimination to interexchange carriers . . . ." Joint Explanatory Statement at 12223.  The parties disagree, however, whether the CompleteAccess and Buyer's" ',-(-(ZZ" Advantage programs presently violate the MFJ precedent carried forward under section 251(g). Because we conclude that these programs constitute the unlawful provision of interexchange service in violation of section 271, we need not reach the issue whether they also violate Ameritech's and U S WEST's equal access and nondiscrimination obligations under section 251(g). We believe, rather, that the more prudent course would be to initiate a rulemaking to consider carrier obligations under section 251(g) and determine which obligations the Commission should properly retain under the new competitive paradigm  X_-contemplated by the 1996 Act.. _m yO-ԍxContrary to the defendants' assertions, the Commission has not previously described what the full scope of the equal access and nondiscrimination obligations are under the 1996 Act, as carried over from the MFJ by  {Oh -section 251(g). The Commission did not anticipate in the NonAccounting Safeguards Order, as defendants assert, that BOC teaming arrangements with IXCs generally are consistent with the equal access and nondiscrimination requirements. 11 FCC Rcd 21905. Rather, the Commission merely acknowledged that any "teaming" arrangements previously allowed under MFJ precedent continue to be permissible under section 251(g), and did not modify or revise the equal access and nondiscrimination provisions of the MFJ, as carried forward by the 1996 Act. Nor did the Commission address the full scope of the BOCs' equal access and  {O-nondiscrimination obligations in the BellSouth South Carolina 271 Order. 13 FCC Rcd 539. Instead, the Commission balanced the obligation to read in random order a list of interexchange carriers, which is among the specific rules adopted by the MFJ Court pursuant to the equal access and nondiscrimination obligations, with the express statutory language in section 272(g)(2) permitting a BOC to jointly market its long distance affiliate's  {O<-services. Id.Ē Indeed, through this rulemaking, the Commission can consider more broadly the proper scope of the equal access and nondiscrimination requirements in the postAct environment.  X -x554.SECTION 251(G)` ` So as not to prejudge that future rulemaking, we choose not to decide the present legality of these business arrangements under section 251(g). In considering the record before us, however, SECTION 251(G)we believe the facts raise serious concerns that Ameritech and U S WEST, through the CompleteAccess and Buyer's Advantage programs, may have violated  X -their existing equal access and nondiscrimination obligations. SECTION 251(G)Specifically, MFJ precedent, which would expressly control an analysis under section 251(g) prior to our future rulemaking, would appear to prohibit a BOC's endorsement or promotion of one IXC's services over another IXC's services. The MFJ Court specifically applied the equal access and nondiscrimination requirements to the BOCs' dealings with their customers in a case  X4-involving the treatment of undesignated long distance traffic=Z4 m yO-ԍxThe term "undesignated traffic" refers to inter-LATA calls made by subscribers who do not designate an  {Ok -interexchange carrier either by presubscription or by use of an access code. United States v. Western Elec., 578 F. Supp. 668, 669.= during the period equal access  X-initially was phased in.'m {O#-ԍxUnited States v. Western Elec., 578 F. Supp. 668. In that same case, the court found that the "basic  {Ox$-purpose of the decree [was] to place all interexchange carriers on an equal footing." Id. at 677. ' Indeed, the MFJ Court made clear that the BOCs were permitted to"(<,-(-(ZZ" assist customers in locating a long distance carrier, "provided that no favoritism is shown to  X-any particular carrier.":m {Ob-ԍxId.:  X-x655.` ` The MFJ Court also appeared to articulate broadly a principle of nonfavoritism  X-underlying the BOCs' equal access and nondiscrimination obligations in the Endorsement  X-case.Zm {O-ԍxUnited States v. AT&T, Civ. Action No. 820192, slip op., (D.D.C. Apr. 11, 1985) (Endorsement). In that case, Southwestern Bell leased a PBX (essentially a switch placed on a business customer's premises) as well as maintenance and support services to National Telecommunications, a reseller of interexchange service. Southwestern Bell provided National Telecommunications with the following "endorsement of quality:" XxNational Telecommunications of Austin is a new discount long distance company servicing the Austin freecalling area. With National, every call you make is handled by switching equipment provided and maintained by Southwestern Bell Telecom. Then, your call is transmitted over the Southwestern Bell Telephone Company and AT&T Communications network system. This system is completely compatible with the system National  X-Telecommunications is utilizing.Km {O/-ԍxId. at 2 n.2. K  The court held that, "by granting to National an endorsement of quality, Southwestern Bell  XM-has violated the nondiscrimination provision of section II(B) of the decree."@M~m {O|-ԍxId. at 3.@  PHYSICAL x  X-x756.BOC CALLING CARD` ` In a case examining the propriety of BOC practices relating to calling cards, the court determined that the BOCs could issue calling cards usable for both local and long distance calls, provided that they did not discriminate among the various interexchange  X-carriers with respect to the calling cards.m {O-ԍxUnited States v. Western Electric, 698 F. Supp. 348, 353 (D.D.C. 1988) (BOC Calling Card).ĝ The court found that the preferential treatment afforded to AT&T by the BOCs in that instance violated the equal access and  X-nondiscrimination provisions of the MFJ.gm {O!-ԍxId. at 353. The preferential treatment included: (1) assigning to AT&T all of the long distance calls made on BOC calling cards; (2) making calling card validation information available only to AT&T; (3) marketing and advertising of BOCissued calling cards in a manner that promoted AT&T's interexchange service over the service of other carriers; and (4) providing an international number on their calling cards that credits  yO!%-calls only to AT&T where other interexchange carriers could not obtain comparable international numbers. g In reaching its conclusion, the court relied on, among other things, the fact that any advertising or marketing of the calling card by the BOC")T ,-(-(ZZo"  X-effectively promoted AT&T's service over that of other interexchange carriers' services.$m {Oy-ÍxId. at 356. See, e.g., id. at 354 (finding that AT&T derived a "considerable competitive advantage from  {OC-its sole access to the validation databases it shares with the [regional BOCs]"); id. at 357 n.50 (finding that "use of an international number which has the effect of crediting calls only to AT&T tends to promote the use of AT&T international carriage and service"). Indeed, the court noted that any advertising by the BOCs of the calling card service when AT&T was the only long distance provider associated with that service would have the "direct foreseeable effect of promoting AT&T services over those of the other interexchange  X-carriers."m {O -ԍxId. at 356. The court further concluded that the BOCs' failure to inform customers that they had a choice among interexchange carriers, combined with the BOCs' practice of automatically routing interexchange services to AT&T because AT&T was the only carrier capable of handling the traffic at the time was  {Oc -misleading to customers. Id. at 35657, 357 nn.4445. The court noted that such advertising may mislead customers into believing that long distance calls made with the BOC calling card would be carried by the BOCs  {O -themselves. Id. at 356 n.38.Ħ  Xv-x857.` ` Taken together, these cases appear to stand for the proposition that BOCs may not favor an interexchange carrier by endorsing or promoting the services of one interexchange carrier over another. Specifically, these decisions factored in, among other things, that BOCs maintain both a ubiquitous brand name awareness and unparalleled access to customers that, without constraints, easily could be used to steer customers' decisions and, as a result, influence competition in the long distance market. Accordingly, to make sure that customers make their long distance choices based solely on the merits of a long distance offering, the MFJ Court determined that the BOCs must facilitate the ability of customers to choose, but remain neutral as a participant in that decision.  X-x958.` ` Applying this MFJ precedent to the record before us raises serious concerns that Ameritech and U S WEST, under the CompleteAccess and Buyer's Advantage programs, are endorsing and promoting Qwest's long distance service over that of other IXCs' services in violation of the existing equal access and nondiscrimination requirements.  X-x:59. EXPRESS ` ` In particular, the record indicates that Ameritech and U S WEST are actively recommending Qwest's long distance service over other interexchange carriers' service. For example, Ameritech's marketing script specifically states, Xx"You have many companies to choose from to provide your long distance  X-service. I can read from a list of available carriers, but I'd like to recommend Qwest Communications, and I can provide more details on the Qwest offer, if  X~-you wish."I~2 m yOa%-ԍxAmeritech Brief at 22. I  "g* ,-(-(ZZ"Ԍ X-Additionally,  EXPRESS  Ameritech's training materials instruct its representatives to market CompleteAccess to small business customers who call Ameritech inquiring about, among  X-other things, additional lines and adding or deleting features to their existing service.\m yOK-ԍxAmeritech Brief at Exhibit 22, AM 1057985.\ Ameritech's marketing scripts state that Qwest's rates "offer[ ] significant savings over MCI,  X-AT&T, and Sprint."oZXm {O-ԍxId. at AM 1059091. Arguably, Ameritech's price comparison of long distance carriers' plans and the suggestion that Ameritech customers would benefit most from the Qwest plan, as opposed to the other IXCs' plans, place Ameritech in the position of endorsing Qwest's long distance service over the IXCs' service.o Through the Buyer's Advantage program, U S WEST also is actively endorsing and recommending Qwest's long distance service. For example, during outbound telemarketing, U S WEST informed its customers about its "special one stop shopping offer  X_-on all your calls whether they are local or long distance."_zm {O -ԍxU S WEST Answer at Tab 4B2 at 1, Appendix (outbound marketing script); see also U S WEST Answer at 17.  X1-x;60. RIGOROUS ` ` Ameritech's training materials also instruct its representatives to tell its customers that Ameritech invited all the major IXCs to participate in the review process, and that it "selected" Qwest as the long distance provider for the CompleteAccess package because Qwest "satisfied the rigorous requirements [Ameritech] established for quality, value  X -and convenience."_ m yOZ-ԍxAmeritech Brief at Exhibit 22, AM 10591._ Such representations may encourage use of Qwest and may even suggest that other IXCs' services are inferior to Qwest's, while failing to acknowledge that  X -most of the major long distance carriers elected not to participate in the review process. d m yO-ԍxBased upon Ameritech's endorsement, one might reasonably conclude, although wrongly, that the major carriers participated in the review process, and that, upon thorough evaluation, Ameritech concluded that none of the major carriers met its rigorous requirements for quality, value, and convenience. In fact, Ameritech did not have an opportunity to make such a determination because none of the major carriers actually participated in the review process. Ameritech Brief at 12 (stating that only two IXCs, Qwest and Frontier, responded favorably to Ameritech's RFP regarding participation in the underlying arrangement). Finally, Ameritech's training materials instruct its representatives to state that, by entering into its arrangement with Qwest, Ameritech will be offering its customers long distance  Xb-service "with the best price, performance, and quality available in the marketplace."Zbm yO -ԍxAmeritech Brief at Exhibit 23 , AM 10771.Z U S WEST's marketing materials instruct its representatives to encourage its customers to select  X6-Qwest over all other long distance carriers.6lm {OS$-ԍxU S WEST Answer at Tab 4B1 at 2, Appendix (offering script); see also U S WEST Answer at 16.  X-x<61. BRANDING ` ` In addition to Ameritech's and U S WEST's active endorsement of Qwest's long distance service, their branding of the respective total package of services as their own"+,-(-(ZZ " program places them in the position of endorsing, at least implicitly, Qwest's long distance service. Indeed, Ameritech acknowledges that CompleteAccess is attractive to small carriers,  X-like Qwest, that "[lack] brand recognition."Vm yOK-ԍxAmeritech Brief at Exhibit 16, 6668.V Presumably, this is so because, although many local customers may not recognize Qwest's brand name, they undoubtedly will recognize Ameritech's; thus, the mere association of Qwest's long distance service with Ameritech's services would suggest to customers that Ameritech endorses Qwest's services over other IXCs'. The same is true with regard to U S WEST's promotion of Qwest's long distance service. These marketing arrangements allow Qwest to have its name and long distance service associated with the BOC's local service brand name, and to enjoy the same unparalleled access to customers as the BOC. Ameritech's and U S WEST's marketing of Qwest's long distance service under their own brand, in conjunction with their own local and intraLATA toll services, at least implicitly demonstrates that Ameritech and U S WEST are endorsing and promoting Qwest's long distance service.  X -x=62.` ` We also find it difficult to foresee how Ameritech and U S WEST could recommend the services of multiple IXCs, while also fulfilling the terms of their contractual agreements with Qwest. In fact, Ameritech acknowledges that it has not developed a plan for  Xy-this situation.$yXm {O-ԍxSee Ameritech Brief at Exhibit 16, 14345 (acknowledging that Ameritech has not outlined specific procedures to market the interLATA services of multiple carriers). Additionally, when asked how a BOC could market multicarrier interLATA services, Qwest's CEO stated, "[t]o be perfectly honest with you, Alvin, I don't  {O-know how they'll do it." See AT&T and MCI Brief at Exhibit 27, 9 (Qwest/U S WEST Press Conference). BILLING  Because the CompleteAccess program includes only Ameritech's intraLATA toll offering and requires that Qwest employ Ameritech's billing and collection services,  XK-again, we question whether the arrangement is truly available to all interexchange carriers.iKDm yO@-ԍxAmeritechQwest Teaming Agreement  1.02. i The practical effect of an arrangement that requires an IXC to package its long distance service with the BOC's intraLATA toll service is that carriers offering both intraLATA toll and interLATA services would be forced to pay Ameritech each time a customer selected the CompleteAccess package, even though the carrier may have lost one of its intraLATA  X-customers to Ameritech in the process.Tm {O]-ԍxSee AT&T and MCI Brief at 47.T Furthermore, that carrier effectively would be  X-funding its competitor's (the BOC's) intraLATA toll service campaign."f m {O!-ԍxId. We also are concerned that, by requiring that Ameritech and U S WEST to serve as the center for all customer contact for their respective programs, the BOCs' arrangements with Qwest may weaken the IXCs' relationship with their existing customer base, while providing the BOC with the opportunity to hold itself out as the source for "onestop shopping." AT&T and MCI Brief at 50. Finally, although Ameritech and U S WEST claim that they are willing to negotiate different terms with other",P ,-(-(ZZp"  X-carriers,\m yOy-ԍxAmeritech Brief at 6; U S WEST Answer at 8.\ we question whether the intraLATA toll component of the CompleteAccess and Buyer's Advantage programs is negotiable because of the material benefit the BOCs obtain from this particular term.  X-x>63.` ` For these reasons, we seriously question whether these arrangements would be permissible at present under the equal access and nondiscrimination requirements carried over from the MFJ, embodied in section 251(g). Whether such arrangements should be permitted in the future, however, properly awaits the intended Commission rulemaking, as contemplated under section 251(g), on the scope of carriers' equal access and nondiscrimination obligations in the postAct environment. - J:\WPDOCS\HARMON\QWESTDFT\DISC251.FIN-  X - .J:\WPDOCS\HARMON\QWESTDFT\CONCLUSN.FIN. |IV. CONCLUSIONTP  X - x?64.` ` For the reasons discussed above, we find that Ameritech's and U S WEST's offering of Qwest's long distance service as part of a combined package of services under the CompleteAccess and Buyer's Advantage programs is a violation of section 271 of the Communications Act of 1934, as amended.  Xb- 5 V. ORDERING CLAUSES TP  X4- x@65.` ` Accordingly, IT IS ORDERED that, pursuant to sections 1, 4(i), 4(j), 208, and 271 of the Act, as amended, 47 U.S.C.  151, 154(i), 154(j), 208, 271, and section 1.106 of the Commission's rules, 47 C.F.R.  1.106, the formal complaints filed by AT&T Corporation, MCI Telecommunications Corporation, Association of Local Telecommunications Services, MGC Communications, Time Warner Communications Holdings, Inc., NEXTLINK Illinois, Inc., and NEXTLINK Ohio, L.L.C. against Ameritech Corporation and Qwest Communications, DefendantIntervenor, by AT&T Corporation, MCI Telecommunications Corporation, Association of Local Telecommunications Services, and NEXTLINK Washington, L.L.C against U S WEST Communications, Inc. and Qwest Communications Corporation, DefendantIntervenor, and by McLeodUSA Telecommunications Services, Inc., ICG Communications, Inc., and GST Telecom, Inc. against U S WEST Communications, Inc. ARE GRANTED to the extent described herein and ARE OTHERWISE DENIED.  X-xA66.` ` IT IS FURTHER ORDERED that the Motions for Leave to File Comments as  X-Amicus Curiae filed by Advanced Communications Group, Inc., the Bell Atlantic telephone companies, BellSouth Corporation and BellSouth Telecommunications, Inc., the Public Utility Commission of Oregon, SBC Communications, Inc., the Public Utility Commission of Texas, the Washington Utilities and Transportation Commission, and Williams Communications, Inc. ARE GRANTED. "j$-X,-(-(ZZ)"Ԍ X-xB67.` ` IT IS FURTHER ORDERED that resolution of the Motion for Confidential Treatment and Entry of Protective Order filed by Qwest Communications Corporation IS DEFERRED pending resolution of the confidentiality of certain information referred to herein that has been designated as confidential by Ameritech Corporation and US WEST Communications, Inc.  Xv-xC68.` ` IT IS FURTHER ORDERED that all other motions filed in these formal complaint proceedings but not specifically ruled upon are DISMISSED AS MOOT.  X1-xD69.` ` IT IS FURTHER ORDERED that this Memorandum Opinion and Order shall be effective upon adoption and release to the parties to these formal complaint proceedings.  X - xE70.` ` IT IS FURTHER ORDERED that the Chief, Formal Complaints and Investigations Branch, Enforcement Division, Common Carrier Bureau, shall forward a copy of this decision to the United States District Court for the Western District of Washington, and to the United States District Court for the Northern District of Illinois, promptly upon release of this Memorandum Opinion and Order. x` `  hhFEDERAL COMMUNICATIONS COMMISSION  X4- x` `  hhMagalie Roman Salas x` `  hhSecretary .VJ:\WPDOCS\HARMON\QWESTDFT\CONCLUSN.FIN.  ".,-(-(ZZa"  / @A-@  X- *J:\WPDOCS\HARMON\QWEST\STATMEN.NES*  X X` hp x (#%'0*,.8135@8: -97-295 (rel. Aug. 18, 1997), further recons. pending. i As the Order notes, equal access obligations originally were meant to respond to the government's contentions that, in interconnecting their local networks with the networks of the various long distance companies, the BOCs  X-provided inferior interconnection to AT&T's competitors.  H6  {O-#X\  P6G;P#эxUnited States v. Western Electric Co., 552 F. Supp. 131 (D.D.C. 1982), aff'd sub nom., Maryland v.  {OW-United States, 460 U.S. 1001 (1983), vacated. Indeed, one could argue that the nondiscriminatory interconnection obligations imposed on all incumbent LECs by section 251(c)(2) were meant to encompass the  {O-duty to provide equal access and nondiscriminatory treatment to long distance companies. See 47 U.S.C.  251(c)(2) (requiring incumbent LECs to provide to "any telecommunications carrier" interconnection that is "equal in quality" to the interconnection LEC provides itself and that is "on rates, terms, and conditions that are . . . nondiscriminatory"). This could mean, for example, that the Commission merely needs to clarify that the  {O -interconnection obligations imposed in the Local Competition Order were sufficient to satisfy section 251(g).  In the interest of avoiding duplicative requirements, the Commission should think carefully about whether the goals underlying section 251(g) are achieved through the requirements we have already imposed pursuant to the other provisions of section 251. We also should be circumspect about expanding obligations under section 251(g) and should be cautious about imposing equal access and nondiscrimination obligations on BOCs that are different from those imposed on other incumbent LECs.  X -xProcompetitive Benefits. Finally, in developing and applying the requirements contemplated under section 251(g), we should not lose sight of the ultimate goal of equal access and nondiscrimination, which is to bring the benefits of competition to the public. While new business arrangements involving large incumbent LECs like the BOCs potentially raise anticompetitive concerns, these arrangements also promote competition by allowing smaller entrants in long distance or other markets to establish viability in those markets through creative business relationships with established firms. Such relationships, in turn, may benefit consumers in the form of lower prices and stronger incentives on all market participants to match or surpass the new technologies and services used by the entrants. We believe we also should recognize that entrants' incentive and ability to gain such footholds through arrangements with the incumbent may turn, in part, on the degree to which the entrant can differentiate itself in the marketplace. xThus, in thinking through the extent to which equal access and nondiscrimination requirements should apply to carriers in the postAct world, it is our sincere hope that we will be as sensitive to these concerns as we believe the Commission has been in this proceeding. Most of all, we must keep in mind that the equal access and nondiscrimination requirements need to be consistent with the transition from monopoly to a competitive paradigm and should not invalidate or further burden carriers' current activities. It is because of the Commission's wise decision to postpone resolution of these and other issues related to section 251(g) until  X_-we can examine them more thoroughly that we are happy to support the Order as strongly as we do here. xWe commend the Commission staff for its diligent and speedy work on these complex and elusive issues. Moreover, we look forward to working together with everyone at the Commission as we revisit the issues of equal access and nondiscrimination and as we consider the many novel business arrangements that competition will no doubt bring us. )J:\WPDOCS\HARMON\QWEST\STATMEN.JT)