Federal Communications Commission DA 01-843

FEDERAL COMMUNICATIONS COMMISSION

Washington, D.C. 20554

Adopted: December 10, 2001

Released: December 11, 2001

Mr. Jeff Ward

Senior Vice President – Regulatory Compliance

Verizon Communications

1310 North Courthouse Rd. - 4th floor

Arlington, VA 22201

RE: Bell Atlantic/GTE Merger Order, CC Docket No. 98-184

Dear Mr. Ward:

With this letter, the Common Carrier Bureau (Bureau) approves in part the request of Verizon Communications, Inc. (Verizon) to implement certain changes to the carrier-to-carrier performance measurements that Verizon reports to the Commission pursuant to the Bell Atlantic/GTE Merger Order.[1]

I. Background

To offset the merged company’s increased ability to discriminate against its local competitors, the Bell Atlantic/GTE Merger Order established the Carrier-to-Carrier Performance Plan (Performance Plan). The Performance Plan imposes two obligations on Verizon: 1) to report monthly performance measurement data that illustrate the quality of service the company provides to competitive local exchange carriers (CLECs) in the areas of pre-ordering, ordering, provisioning, maintenance and repair, and billing; and 2) to make voluntary payments to the United States Treasury if its quality of service, as gauged by the performance data, falls below certain standards.[2] Verizon reports data on 17 performance measurements for the former Bell Atlantic service area based on similar measurements developed by the New York Commission,[3] and it reports data on 17 performance measurements for the former GTE service area based on similar measurements developed by the California Commission.[4]

The Merger Order requires Verizon and the Bureau to review the performance measurements semi-annually to determine whether measurements should be added, deleted, or modified.[5] The Bureau may decide at each semi-annual review whether Verizon should make changes to the measurements based on, among other things, proposals arising from collaborative sessions or state commission decisions.[6] Verizon made certain proposals in February 2001,[7] and other proposals in August 2001.[8] This letter addresses the issues raised in both semi-annual reviews, except those related to the flow-through performance measurements and voluntary payment calculations that Verizon proposed pursuant to the Merger Order.[9] The Bureau will address Verizon’s flow-through and payment calculation proposals in the future.

II. Verizon’s Proposed Semi-annual Review Changes

Verizon proposes numerous changes to the Performance Plan, the most significant of which (other than those specifically addressed below) are described in the Attachment to this letter. The New York and California commissions have already approved most of these changes in the course of their own performance measurements reviews.

In addition to the substantive proposals, Verizon requests eight minor clarifications to the business rules. These edits would not change the way the measurements are calculated; rather they would clear up potential ambiguity in the business rules.[10] I approve these proposed clarifications.

Except as discussed below, I approve Verizon’s proposals. Verizon should implement the approved changes as soon as practicable, and propose an implementation schedule within 15 days of receipt of this letter.

a. CLEC Testing – Installation. As part of the first semi-annual review, and with respect to Verizon East measurement PR-6-01, Installation Quality, Verizon proposes that “[i]f Verizon identifies any CLEC accepting loops through cooperative testing and finds that the cooperative testing is providing false acceptances, installation troubles reported by that CLEC will be excluded.”[11]

I find this proposed exclusion problematic for several reasons. Verizon has not

defined a “false acceptance” and has not explained why it would be appropriate to exclude all of an individual CLEC’s installation trouble reports if the cooperative testing process yields a single false acceptance.[12] This exclusion has not, to our knowledge, been discussed with CLECs in the New York collaboratives, nor has the New York Commission approved it. These and other relevant questions are best answered in those collaboratives. The Bureau would consider such a change after the New York Commission has reviewed and adopted it.[13]

b. CLEC Testing – Maintenance & Repair. As part of the first semi-annual review, and with respect to Verizon East measurement MR-4, Trouble Duration Intervals, Verizon proposes to exclude from the measurement “[t]roubles where the CLEC does not accept the first available appointment.”[14]

As with the preceding proposal, I believe this matter can be best resolved through the collaborative process overseen by the New York Commission. We would consider such a proposal if this issue is resolved through the state collaborative process.

c. CLEC “mis-directed troubles.” As part of the second semi-annual review, and with respect to Verizon East measurement MR-5, Repeat Trouble Reports, Verizon proposes a new exclusion for that, in Verizon’s words would “[e]xclude CLEC mis-directed troubles from repeat trouble report base.”[15] Because Verizon has provided no evidence that either the New York Commission or CLECs have considered this potentially far-reaching change, I decline to approve it at this time. Verizon may, of course, seek approval of the change after such review.

d. xDSL Retail Comparison. As part of the second semi-annual review, with respect to Verizon West states, Verizon proposes a change beyond those approved by the California Commission. Specifically, Verizon proposes to change the retail comparison for its “UNE 2-wire xDSL Loop” wholesale product, for measurements PR-4, Missed Due Dates, PR-6, Installation Quality, and all the maintenance and repair measurements, to its ISDN-BRI product. Because I find that Verizon’s current retail 2-wire xDSL loop product a more appropriate comparison, I decline to adopt Verizon’s proposal.[16] Verizon should ensure that its wholesale xDSL products are measured against its own retail performance for the same products. If Verizon does not offer certain products on a retail basis that it furnishes wholesale, it should bring that to the Bureau’s attention. The Bureau would, of course, consider Verizon’s proposal should the California Commission approve it.

e. Local Number Portability. Verizon asks that the Bureau not adopt one change for Verizon West that has been approved by the California Commission.[17] Specifically, Verizon objects to adding Local Number Portability (LNP) as a new product disaggregation for several metrics. Verizon has not, however, explained why LNP should not be added to the Performance Plan. The Performance Plan is designed to track California changes and, absent good reason to reject any such changes, the Bureau cannot conclude that this change should not be adopted as part of the Performance Plan.

If Verizon disagrees with the Bureau’s action in this letter, it may file an application for review with the Commission pursuant to section 1.115 of the Commission’s rules.[18]

Please do not hesitate to contact me if I can be of further assistance. You may also contact Mark

Stone in the Common Carrier Bureau directly at (202) 418-0816 for further information on this matter.

Sincerely,

Carol E. Mattey

Deputy Chief, Common Carrier Bureau

CC:Ms. Dee May, Verizon

Attachment

Summary of Verizon Proposed Changes

1. Verizon East

First Semi-annual Review

· PO-1 (Response Time OSS Ordering Interface)

– Clarify that measurement will be expanded as new CLEC interfaces become available.

· PO-2 (OSS Interface Availability)

– Add exclusion for scheduled interface outages for major systems releases where CLECs

receive advanced notice in compliance with Verizon’s Change Management Guidelines.

· PR-9 (Hot Cut Loops)

– Clarify when a hot cut is considered completed and missed.

Second Semi-annual Review

· PR-4-05 (% Missed Appointments – Verizon – No Dispatch)

– Add 2-wire xDSL Line Splitting as new product.

· MR-4 (Trouble Duration Intervals)

– Clarify interval calculation.

2. Verizon West

First Semi-annual Review

·OR-1 (Order Confirmation Timeliness)

– Add exclusion for customer-caused delays.

·OR-2 (Reject Timeliness)

– Add exclusion for customer-caused delays.

·PR-4 (Missed Due Dates)

– Clarify that metric calculation includes only due dates missed for Verizon-caused reasons.

· Multiple Measurements

– Clarify products reported for specific sub-measurements.

Second Semi-annual Review

· OR-1 (Order Confirmation Timeliness)

– Define “business hours.”

· OR-2 (Reject Timeliness)

– Define “business hours.”

1

[1] Applications of GTE Corporation, Transferor, and Bell Atlantic Corporation, Transferee, For Consent to Transfer Control of Domestic and International Sections 214 and 310 Authorizations and Application to Transfer Control of a Submarine Cable Landing License, CC Docket No. 98-184, Memorandum Opinion and Order, 15 FCC Rcd 14032, Appendix D, ¶¶ 16-17, (2000) (Bell Atlantic/GTE Merger Order or Merger Order).

[2]Id. The first three-month period subject to payments was April, May, and June 2001. See Merger Order at Appendix D, Attachment A, ¶ 13.

[3]See id. at ¶ 17(a). “Bell Atlantic service area” (hereinafter Verizon East) means the service areas of Bell Atlantic-Delaware, Inc., Bell Atlantic-Washington, D.C., Inc., Bell Atlantic-Maryland, Inc., Bell Atlantic-New Jersey, Inc., Bell Atlantic-Pennsylvania, Inc., Bell Atlantic-Virginia, Inc., Bell Atlantic-West Virginia, Inc., New York Telephone Company, New England Telephone and Telegraph Company where those companies operated as incumbent local exchange carriers (ILECs) as of January 27, 2000. See id. at 2.

[4]See id. at ¶ 17(b). “GTE service area” (hereinafter Verizon West) means the service areas of GTE California Inc., GTE Florida Inc., GTE Hawaiian Telephone Company Inc., The Micronesian Telecommunications Corporation, GTE Midwest Inc., GTE North Inc., GTE Northwest Inc., GTE South Inc., GTE Southwest Inc., Contel of Minnesota, Inc., GTE West Coast Inc., and Contel of the South, Inc. where those companies operated as ILECs as of January 27, 2000. See id. at 2.

[5]Merger Order at Appendix D, Attachment A, ¶ 4.

[6]Merger Order at Appendix D, Attachment A, ¶ 4.

[7] Letter from Dee May, Executive Director, Federal Regulatory, Verizon, to Mark Stone, Common Carrier Bureau, (Feb. 7, 2001) (Verizon February 7th Letter).

[8] Letter from Dee May, Executive Director, Federal Regulatory, Verizon, to Mark Stone, Common Carrier Bureau, (Aug. 10, 2001) (Verizon August 10th Letter).

[9]See Merger Order at Appendix D, Attachment A-2a, A-2a-12-13 & Appendix D, Attachment A-2b, A-2b-9.

[10] For example, Verizon proposes to change “July 4th Holiday” to “Independence Day” for consistency, where relevant.

[11] Letter from Dee May, Executive Director, Federal Regulatory, Verizon, to Mark Stone, Common Carrier Bureau, FCC, Attachment 4 at A-2a-25 (March 30, 2001) (Verizon March 30th Letter). Cooperative testing involves the CLEC and ILEC together testing a given line for usability.

[12]See also, Application of Verizon New England, Inc., Bell Atlantic Communications, Inc. (d/b/a Verizon Long Distance), NYNEX Long Distance Company (d/b/a/ Verizon Enterprise Solutions) and Verizon Global Networks Inc., For Authorization to Provide In-Region, InterLATA Services in Massachusetts, CC Docket No. 01-9, Memorandum Opinion and Order, FCC 01-130, 2001 WL 388287 (FCC) at ¶ 147 (Apr. 16, 2001) (Massachusetts 271 Order) (noting factual disputes concerning Verizon’s acceptance testing process).

[13]SeeMerger Order at Appendix D, Attachment A, ¶ 4.

[14]Verizon March 30th Letter, Attachment 1 at 10; Attachment 4 at A-2a-33.

[15] Verizon stated that it will consider a trouble mis-directed if 1) “the initial trouble is closed to a no access disposition code” or 2) there are “only [two] troubles and they are in opposite directions (dispatched in and dispatched out) and the first of the troubles is no trouble found, found OK, or CPE.” See Verizon August 10th Letter, Attachment A-2a at A-2a-32. This proposal is separate from those already approved by the New York Commission and agreed-to by CLECS participating in the New York collaboratives.

[16] Verizon recently received Bureau approval to re-integrate its retail advanced services affiliate into its ILECs. See Application of GTE Corporation, Transferor, and Bell Atlantic Corporation, Transferee, for Consent to Transfer Control of Domestic and International Section 214 and 310 Authorizations and Applications to Transfer Control of a Submarine Cable Landing License, CC Docket No. 98-184, Order, DA 01-2203, 2001 WL 1135400

(Sept. 26, 2001). As a result, “Verizon retail” will be the Verizon ILECs’ own retail service rather than that of Verizon’s advanced services affiliate. See, e.g.,Merger Order at Appendix D, Attachment A-2b, A2b-11, A-2b-14 (noting that the 2-wire xDSL parity comparison will be Verizon retail).

[17] Verizon described the proposed change during the August 2001 semi-annual review and in an accompanying handout.

[18] 47 C.F.R. § 1.115.