C. Notice and Comment Provision 40. Pursuant to applicable procedures set forth in Sections 1.415 and 1.419 of the Commission's Rules, 47 C.F.R. §§ 1.415 and 1.419, interested parties may file comments on or before October 29, 1991, and reply comments on or before November 28, 1991. 73 To file formally in this proceeding, parties must file an original and five copies of all comments, reply comments, and supporting comments. Parties wanting each Commissioner to receive a personal copy of their comments must file an original plus nine copies. Comments and reply comments should be sent to the Office of the Secretary, Federal Communications Commission, Washington, D.C. 20554. In addition, parties should file two copies of any such pleadings with the Policy and Program Planning Division, Common Carrier Bureau, Room 544, 1919 M Street, N.W., Washington, D.C. Parties should also file one copy of any documents filed in this docket with the Commission's copy contractor, Downtown Copy Center, 1114 21st Street. N.W., Suite 140, Washington, D.C. 20037. Comments and reply comments will be available for public inspection during regular business hours in the Dockets Reference Room of the Federal Communications Commission, 1919 M Street, N.W., Washington, D.C. 20554. For further information regarding this Order and Further Notice of Proposed Rulemaking, contact Melissa Newman, (202) 632-9342, or Suzanne Tetreault, (202) 632-6363, both of the Common Carrier Bureau, Policy and Program Planning Division. 69.210 Interim Transport Pricing The transport rate structure in effect August 1, 1991, shall be retained pending further Commission action. SEPARATE STATEMENT OF COMMISSIONER ANDREW C. BARRETT In Re: MTS and WATS Market Structure (CC Docket No. 78-72, Phase I). Throughout these proceedings on interexchange competition, I have made clear my views that the Commission must not be short-sighted. My goal has been to pave the way for competition throughout each level of the interexchange marketplace. Competition between AT&T, MCI and U.S. Sprint is fine. However, I desire to see other players players competing for customers in this marketplace, as well. This proceeding has gone to the core of that competition from an economic standpoint. Entry into the interstate interexchange market can be either spurred or hindered depending upon the access rates charged by the local exchange carriers (LECs). I do not suggest that LECs should not be able to efficiently price transport in a manner that reflects the costs which are incurred. An unfair rate structure disadvantages not only the local exchange carriers and the interexchange carriers, but also the customers these companies serve. For this reason, I believe the action taken in this Order and Further Notice of Proposed Rulemaking is very important to ensuring an opportunity for full and fair competition. Our decision to maintain the status quo on the rate structure for transport and to seek comment on the appropriate transport rate structure and the various pricing options under this structure is an approach that seeks long term solutions. I have made no secret of my desire to consider the impact of these issues on the smaller interexchange carriers and the resellers. These carriers often serve the smaller businesses in this country and provide service in rural areas. While I am convinced that there will be consolidation among these companies, I do not believe that Federal Communications Commission rules and policies should cause the premature demise of small and mid-size IXCs. Expiration of the Modification of Final Judgment 's provision requiring "equal per unit of traffic" charges, would adversely affect the small and medium size interexchange carriers. On the otherhand, maintenance of the equal charge requirement should not adversely affect any carriers. It will allow the Commission sufficient time to fully explore the issues through the notice and comment process. I would urge commenters to take advantage of this opportunity and to be specific in answering the many questions set forth in the Further Notice. I also would suggest that commenters provide economic data on the impact of the various rate structures and pricing schemes. Rate and pricing schemes that permit maximum competition will be of particular interest to me. As the Comments are filed in this proceeding, I will examine them to ensure that the proposals are fair to all interexchange carriers. Finally, I also will be interested in the views of the competitive access providers on the impact of our proposals on our attempts to provide for expanded interconnection opportunities. Before the Federal Communications Commission Washington, D.C. 20554 by Bellcore, and activate up to 3000 numbers thereunder. D&J at 2-5; AT&T Tariff F.C.C. No. 15, Transmittal 2982, Section 19.1, 3rd Revised Page 50. 1. AT&T Communications (AT&T) filed Transmittal No. 2982 on March 22, 1991. This transmittal introduces AT&T's seventeenth Competitive Pricing Plan (CPP17) under AT&T Tariff F.C.C. No. 15, scheduled to become effective on July 20, 1991. According to AT&T, CPP17 constitutes its competitive response to an offer made by US Sprint Communications Company Limited Partnership (US Sprint) to VoiceCom Systems, Inc. (VoiceCom). Petitions against this transmittal were filed by the Competitive Telecommunications Association (CompTel), MCI Telecommunications, Inc. (MCI), and US Sprint.' For the reasons discussed below, we suspend Transmittal 2982 for the full five-month statutory period. II. BACKGROUND 2. AT&T contends that this transmittal represents its competitive response to an offer made by US Sprint to provide VoiceCom with telecommunications services at rates that are significantly below US Sprint's tariffed rates, and include other inducements such as the activation and testing of the NXX code assigned to VoiceCom and the activation of 800 numbers under that code. According to AT&T, VoiceCom has expressed its intention to accept the US Sprint offer if AT&T is unable to meet it. AT&T Transmittal 2982, Description and Justification (D&J) at 1-2. 3. CPP17 would provide VoiceCom with MEGACOM and MEGACOM 800 services under a postalized usage charge of 8.5 cents per minute, which would replace any other usage, recurring or non-recurring charges otherwise applicable under the standard MEGACOM tariffs. CPP17 requires VoiceCom to make a 225 million minute usage commitment over its five-year term, gradually loaded more heavily on the later years of the term, and AT&T asserts this generally follows the US Sprint proposal and the request for proposals released by VoiceCom. In addition, AT&T undertakes for a one-time charge of $107,000 to activate and test the NXX code assigned to VoiceCom A. Petitions III. PLEADINGS 4. CompTel and MCI incorporate by reference their pleadings and petitions against each prior Tariff 15 offering. See CompTel Petition at 2; MCI Petition at 4. 5. The petitioners argue that CPP17 fails to satisfy the competitive necessity test2 upon which AT&T relies as justification for this filing. See, e.g., CompTel Petition at 2; MCI Petition at 5-7. According to MCI, the competitive necessity doctrine applies to service provided to classes of customers, not single customers. Thus, the five-year term requirement and condition that customers must have received US Sprint's competing offer, combined with AT&T's assertion that US Sprint has not offered its Ultra 800 and Ultra WATS services at these rates and terms to any other customer, effectively limit CPP17 to a singlecustomer offering. MCI Petition at 6-7, citing AT&T Tariff 15, § 2.1.5.A.3, Murphy Affidavit at 7. MCI notes that AT&T's tariff requires the customer to demonstrate its receipt of a substantially similar offer from a competitor, but is silent as to the nature of the demonstration. Id. at 6. 6. MCI also contends that AT&T leverages its status as the incumbent inbound service provider, representing nearly 90 percent of the traffic up for bid, by "bundling" this Megacom 800 service with its outbound Megacom service. MCI argues that VoiceCom's ownership of these 800 service numbers is not sufficient to offset the leverage exerted by AT&T, because it would cost VoiceCom considerable amounts in network reconfiguration and interaction with local exchange carriers to effect such a move. MCI Petition at 4-5. 7. MCI also asserts that CPP17 is effectively limited to VoiceCom because, while prospective customers must accept its five-year term and have received US Sprint's counterpart offer, US Sprint has not offered its services to any other customer under the rates and terms offered VoiceCom. Thus, MCI contends AT&T cannot invoke the competitive necessity doctrine. Id. at 6-7. Moreover, MCI argues, as CPP17 is not a "new service offering" as defined in Section 61.3(r) of the Commission's Rules, 47 C.F.R. § 61.3(r),* AT&T is required to submit a cost of service study under Section 61.38 of the Commission's Rules, 47 C.F.R. § 61.38(b)(1), but has failed to satisfy that requirement. Id. at 7-8. 8. US Sprint also contends that CPP17 is a customerspecific offering and hence unreasonably discriminatory and, in any case, fails to satisfy the showing required by the competitive necessity test. First, US Sprint asserts, AT&T has effectively underpriced the US Sprint offer in three respects. AT&T provides a discount comparable to US Sprint's conversion allowance although no conversion expense is incurred by VoiceCom to remain with AT&T. Further, the AT&T offer would bill VoiceCom only for completed calls, while the US Sprint service would charge for all incomplete calls; US Sprint argues this difference represents an approximate price difference of twenty percent. In addition, the US Sprint offer does not guarantee the rate beyond 30 days. US Sprint argues that absent number portability, allowing AT&T to "match" |