I.15-11-007 ALJ/KJB/ge1 PROPOSED DECISION
ALJ/KJB/ge1 PROPOSED DECISION Agenda ID # 15591
Ratesetting
Decision ______
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Investigation into the State of Competition Among Telecommunications Providers in California, and to Consider and Resolve Questions raised in the Limited Rehearing of Decision 08-09-042. / Investigation 15-11-007(Filed November 5, 2015)
DECISION GRANTING COMPENSATION TO THE UTILITY REFORM NETWORK FOR CONTRIBUTION TO DECISION 16-12-025
Intervenor: The Utility Reform Network / For contribution to D.16-12-025Claimed: $498,860.22 / Awarded: $493,582.00
Assigned Commissioner: Carla J. Peterman / Assigned ALJ: Karl J. Bemesderfer
PART I: PROCEDURAL ISSUES
A. Brief description of Decision: / This Final Decision closes an investigation into the state of competition in California’s telecommunications marketplace. The Final Decision relies upon a record that consists of large amounts of data, voluminous testimony, and detailed written briefs to analyze the structure of the marketplace, the level of competition across submarkets, and the impact on just and reasonable rates and nondiscriminatory services. The Final Decision finds that the markets for both voice and broadband are rapidly changing to meet customer needs, but these markets are currently concentrated and do not adequately serve all Californians. The Final Decision closes the docket, but orders carriers to continue to submit tracking data to the Commission and requires Communications Division staff to issue a report in 2018 analyzing voice and broadband markets in California. The Final Decision also orders the Commission to open a new docket to examine rights of way and pole attachments.B. Intervenor must satisfy intervenor compensation requirements set forth in
Pub. Util. Code §§ 1801-1812:
Timely filing of notice of intent to claim compensation (NOI) (§ 1804(a)):
1. Date of Prehearing Conference (PHC): / 1/20/2016 / Verified
2. Other specified date for NOI: / N/A
3. Date NOI filed: / 2/19/2016 / Verified
4. Was the NOI timely filed? / Yes
Showing of customer or customer-related status (§ 1802(b)):
5. Based on ALJ ruling issued in proceeding number: / A.15-03-005 / Verified
6. Date of ALJ ruling: / August 6, 2015 / Verified
7. Based on another CPUC determination (specify): / N/A
8. Has the Intervenor demonstrated customer or customer-related status? / Yes
Showing of “significant financial hardship” (§ 1802(g)):
9. Based on ALJ ruling issued in proceeding number: / A.15-03-005 / Verified
10. Date of ALJ ruling: / August 6, 2015 / Verified
11. Based on another CPUC determination (specify): / N/A
12. 12. Has the Intervenor demonstrated significant financial hardship? / Yes
Timely request for compensation (§ 1804(c)):
13. Identify Final Decision: / D.16-12-025 / Verified
14. Date of issuance of Final Order or Decision: / 12/8/2016 / Verified
15. File date of compensation request: / 2/6/2017 / Verified
16. Was the request for compensation timely? / Yes
Additional Comments on Part I:
# / Intervenor’s Comment(s) / CPUC DiscussionB.1-4 / TURN submitted its NOI within 30 days of the initial prehearing conference held in this docket on January 20, 2016. Pursuant to Rule 17.1(f), TURN submitted a Supplemental Notice of Intent to Claim Compensation on June 13, 2016 for participation in a related federal court matter filed by several parties to this proceeding on May 5, 2016. TURN filed its first substantive pleadings in the federal court matter on May 12, 2016 and was granted intervenor defendant status in that proceeding on May 18, 2016, thus TURN’s Supplemental NOI was timely filed 30 days after the date TURN first filed a pleading in the judicial review proceeding.
PART II: SUBSTANTIAL CONTRIBUTION
A. Did the Intervenor substantially contribute to the final decision (see § 1802(i), § 1803(a), and D.98-04-059).
Intervenor’s Claimed Contribution(s) / Specific References to Intervenor’s Claimed Contribution(s) / CPUC Discussion1. Summary and Background
When the Commission adopted its Order Instituting Investigation to open this proceeding in 2015, stakeholders anticipated a comprehensive yet contentious litigation intended to provide the Commission with data and analysis to help define its telecommunications policy roadmap. The events in this proceeding confirmed the predictions. This proceeding was procedurally and substantively complicated and contentious, yet TURN’s advocates and expert witnesses fully participated in all aspects of the litigation and made a substantial contribution to each issue in the case.
This was a data-driven proceeding. The Final Decision relies on carrier data responses to Commission information requests and data requests issued to carriers by TURN and ORA, as well as testimony, reports and federal data to support the Commission’s conclusions and findings. Despite the carriers’ best efforts to prevent disclosure of their most confidential subscription data, TURN provided a comprehensive analysis on each issue in the Scoping Memo through its testimony, hearing participation, briefs, and comments.
TURN’s witnesses submitted extensive testimony on market definition, competition, wholesale markets and market analysis criteria. Ultimately, TURN’s substantial contribution, along with other intervenors and ORA, presented the Commission with comprehensive analysis on just and reasonable rates and competitive choice for California consumers.
In addition to addressing substantive issues, the docket was marked by significant motion practice. TURN, in collaboration with other intervenors, issued, responded to, or opposed no fewer than 20 motions regarding all aspects of this proceeding including categorization, discovery and data production, scope and jurisdiction, and scheduling. TURN submits, as discussed below, that its work on these motions was critical to ensuring that the proceeding moved forward on a clear and productive path and shaping the Final Decision’s scope and conclusions.
This proceeding was also unique in that several carrier respondents moved for judicial review of an ALJ Ruling on document and data production to third parties (including TURN) in this proceeding. As discussed below, TURN participated in that federal court action to protect consumer interests by opposing attempts to preempt the Commission from providing intervenors nondiscriminatory access to data and materials, thus ensuring that intervenors can fully and fairly participate in Commission proceedings.
The Final Decision extensively cites to TURN, along with other intervenors,
to support its conclusions and findings, each of which is critical to protecting consumer interests and developing a telecommunication policy roadmap for the Commission.
Intervenor contributions to the record and Final Decision in this proceeding were so substantial that the Commission explicitly acknowledged, “At the outset, we note that Intervenors play an important role in Commission proceedings and will do so in the future….Comments received in this proceeding have validated that observation, as the many citations in the decision to expert testimony from Intervenors’ experts should make clear.” (FD 169)
TURN urges the Commission to find that it has made a substantial contribution to the record in this case. / Order Instituting Investigation (“OII”), November 12, 2015
ALJ/ACR Ruling on Pending Motions and Schedule, February 4, 2016.
Resolution ALJ-328,
March 1, 2016 (categorization).
Opening Testimony of Susan Baldwin on behalf of TURN in Response to Information Requests, March 15, 2016.
Direct Testimony of Trevor Roycroft on behalf of TURN in response to Information Requests, June 1, 2016.
Supplemental Testimony of Susan Baldwin, June 1, 2016.
Rebuttal Testimony of Susan Baldwin, July 15, 2016.
Rebuttal Testimony of Trevor Roycroft, July 15, 2016.
Numerous carrier motions regarding procedural and substantive issues, including motions for reconsideration
ALJ Ruling Adopting Protective Order,
March 1, 2016.
ALJ Ruling Revising Protective Order,
April 1, 2016.
TURN Motion to Compel, April 19, 2016.
ACR/ALJ Ruling re: Outstanding Motions,
May 3, 2016.
ALJ Ruling re: Carrier Motions for Reconsideration and to Stay, May 5, 2016
New Cingular v. PUC, Federal Court complaint/TRO,
May 5, 2016
Scoping Memo, July 1, 2016.
TURN Opening Brief,
August 12, 2016.
TURN Reply Brief,
August 26, 2016.
TURN Opening Comments on Proposed Decision, November 7, 2016.
TURN Reply Comments on Proposed Decision,
November 14, 2016,
Final Decision. / Verified
2. Categorization
The OII tentatively set a ratesetting category for this proceeding, citing to the Commission’s obligation to ensure just and reasonable rates and terms of service as a key issue in the case. The Commission requested comments on the categorization within 90 days.
Less than 30 days from the adoption of the OII, AT&T filed a Request for Reconsideration of the categorization. AT&T argued that the docket should be quasi-legislative and alleged that the Commission would benefit from “open access to information from all parties” and should preserve the industry’s ability to communicate with the Commission.
TURN took the lead to draft a joint opposition to AT&T’s request for reconsideration and to support the adoption of a ratesetting categorization. TURN emphasized that the unique nature of this docket justified use of the “default” ratesetting category, as contemplated by the Rules of Practice and Procedure and that the unlimited and unreported ex pate contacts associated with a quasi-judicial categorization would put TURN and other intervenors with limited resources at a serious disadvantage in this critical proceeding.
The Commission reaffirmed the categorization of this docket as ratesetting, rejecting AT&T’s request for reconsideration. The Assigned Commissioner issued a Ruling stating that ratesetting was the proper category in part because the docket does not fit neatly into a specific category and because the Commission intends
to review just and reasonable rates. Subsequently, the full Commission issued a resolution adopting the final categorization of ratesetting. / OII, p. 16.
AT&T Request for Reconsideration of Categorization, filed November 23, 2015, p.1, 4.
Opposition of TURN, Greenlining and CforAT to AT&T’s Request for Reconsideration, filed December 7, 2015.
Assigned Commissioner’s Ruling Regarding Categorization,
February 3, 2016.
Resolution ALJ-328, Ratification of changes to preliminary determination regarding categorization of proceeding I.15-11-007,
March 1, 2016.
Scoping Memo, July 1, 2016
at p. 5. / Verified
3. Scope and Jurisdiction
The OII clearly stated the Commission’s intention to conduct a comprehensive
and wide-ranging investigation into competition and rates in the California telecommunications market. The OII explicitly anticipated addressing issues regarding landline, cable, and wireless services- both voice and broadband- in its preliminary scope. The Information Requests attached to the OII requested data and analysis on a full range of issues.
The majority of the approximately
20 motions filed by carriers in this docket raised various objections to the scope of the docket and, by extension, argued that the Commission lacked jurisdiction to require certain carrier affiliates to participate, to require carriers to provide broadband-related data and analysis. The carriers repeatedly urged the Commission to limit its investigation only to aspects of basic local voice service offered by incumbent carriers.
TURN, working closely with other consumer intervenors, opposed each of the carriers’ motions and supported a broad scope and clear statement of jurisdiction by the Commission to ensure a meaningful investigation. In its pleadings, TURN demonstrated that under both federal and state law the Commission retains the authority to require document and data production from a wide variety of carriers and their affiliates, including data regarding wholesale and broadband services and facilities. TURN, with joint consumers, also argued that the Commission must have broad and comprehensive investigative powers to carry out its statutory obligations to ensure consumers have access to safe, reliable and affordable services as well as the nondiscriminatory access to advanced services.
TURN’s expert witnesses also submitted testimony stating that the Commission must take a broad approach to its investigation, including all voice and broadband providers, to gain a clear “snapshot” of today’s communications marketplace.
The ALJ, Assigned Commissioner, and full Commission ultimately rejected each of the carriers’ motions regarding scope and jurisdiction, including requests for interlocutory appeal to the full Commission.
Decision makers agreed with TURN that the Commission’s relevant jurisdiction, along with the scope of this docket, should be defined broadly across technologies and corporate entities. The July 1, 2016 Scoping Memo explicitly noted that, “The landline voice market cannot be understood without understanding the telecommunications ecosystem as a whole,” including digital services and devices.
The Final Decision agreed that voice and broadband markets are inextricably linked and, as a result, the Commission’s investigation must encompass all relevant “submarkets” and services offered over a variety of communications technologies. / OII at pp. 1-2; 10-14; 20-21
See, for example, carriers motions,
Verizon Motion to Remove Verizon Wireless and Wireless Carriers as Respondents (December 15, 2015); Motion by Cox on behalf of its Affiliated Entity to Modify List of Named Respondents (December 18, 2015; Motion by AT&T California and New Cingular to Remove Certain Information Requests and Topics of Investigation (December 22, 2015); Carrier Coalition Motion for Reconsideration of ALJ February 4, 2016 Ruling (March 8, 2016); Carrier Coalition Motion for Reconsideration by the full Commission of the
April 1, 2016 Ruling of the ALJ (April 14, 2016).
TURN’s Reply to Comments on the ALJ’s Ruling Regarding Clarification of the Information Requests, January 18, 2016.
ALJ Ruling on Pending Motions and Issues Discussed at PHC, February 4, 2016.
Joint Consumer Response and Opposition to Pending Procedural Motions,
January 8, 2016.
Joint Consumer Consolidated Response to Motions for Reconsideration, etc.,
March 24, 2016.
ALJ Ruling on Remaining Protective Order Issues and other Issues (April 1, 2016).
ACR/ALJ Ruling re: Outstanding Motions,
May 3, 2016.
ALJ Ruling re: Carrier Motions for Reconsideration and to Stay, May 5, 2016.
Scoping Ruling (July 1, 2016), pp. 1-3.
Final Decision:
p. 3 (voice market is tied to the broadband market in a number of ways).
p. 29 (Commission will examine markets and services including voice, broadband, wholesale and retail, mobile, landline and fixed wireline technologies).
COL 1 (continued statutory obligation to ensure just and reasonable charges and services).
COL 6, 7- Commission policies must encourage wide choice of advanced telecommunications services.
COL 11 (Telecommunications markets extend to all types of services and technologies). / Verified
4.Document Production
The carriers’ data responses to the OII’s Information Requests were at the core of the record in this proceeding. Throughout the proceeding, the carriers objected to the breadth and scope of the Information Requests, as well as the ordered release of certain confidential responses to third parties.