From: bc335@cleveland.Freenet.Edu (Michael H. Riddle) Subject: The FCC Rule in the latest "Modem Tax" Reply-To: mike.riddle@inns.omahug.org Patrick: Here is the pertinent rule the FCC issued which has led to GEnie, inter alia, complaining of increased costs and has generated one of the two current threads about the costs of "modeming." 56 FR 33879-01 RULES and REGULATIONS FEDERAL COMMUNICATIONS COMMISSION 47 CFR Parts 61 and 69 [CC Docket Nos. 89-79, 87-313, FCC 91-186] Creation of Access Charge Subelements for Open Network Architecture and Policy and Rules Concerning Rates for Dominant Carriers Wednesday, July 24, 1991 AGENCY: Federal Communications Commission (FCC). ACTION: Final rule. SUMMARY: The Commission amends its part 69 access charge rules to enable the Bell Operating Companies (BOCs) and other local exchange carriers (LECs) desiring to implement Open Network Architecture (ONA) to offer unbundled ONA services. The Commission also modifies the interim pricing test for new services adopted in the LEC Price Cap Reconsideration Order to provide carriers with additional pricing flexibility. The showing for LEC rates for new services may now include a demonstration that the service is especially risky. LECs will also be allowed to justify non-uniform allocation of overheads. In addition, the Commission requires that the existing feature groups offered by the BOCs be eliminated after a transition period. The Commission expects these actions to stimulate the introduction of innovative new enhanced services. EFFECTIVE DATE: August 23, 1991. FOR FURTHER INFORMATION CONTACT: Mark S. Nadel, Common Carrier Bureau, (202) 632-6363. SUPPLEMENTARY INFORMATION: Paperwork Reduction Act Public reporting burden for the collections of information is estimated to average 258.13 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding the burden estimate or any other aspect of the collections of information, including suggestions for reducing the burden, to the Federal Communications Commission, Office of Managing Director, Paperwork Reduction Project (3060-0298), Washington, DC 20554 and to the Office of Management and Budget, Paperwork Reduction Project (3060-0298), Washington, DC 20503. Background CC Docket 89-79: Notice of Proposed Rulemaking, Amendments of part 69 of the Commission's rules Relating to the Creation of Access Charge Subelements for Open Network Architecture, CC Docket 89-79. Adopted: March 30, 1989. Released: May 9, 1989. 54 FR 20873 (May 15, 1988). CC Docket No. 87-313: Notice of Proposed Rulemaking. Policy and Rules Concerning Rates for Dominant Carriers, CC Docket No. 87-313. Adopted: August 4, 1987. Released: August 21, 1987. 52 FR 33962 (Sept. 9, 1987). By the Commission. Further Notice of Proposed Rulemaking, CC Docket No. 87-313. Adopted: May 12, 1988. Released: May 23, 1988. 53 FR 22356 (June 15, 1988). By the Commission. Supplemental Notice of Proposed Rulemaking, CC Docket No. 87- 313. Adopted: March 8, 1990. Released: March 12, 1990. 55 FR 12526 (Apr. 4, 1990). By the Commission. Second Report and Order, CC Docket No. 87-313. Adopted: September 19, 1990. Released: October 4, 1990. 55 FR 42375 (Oct. 19, 1990). By the Commission. Commissioner Duggan concurring in part and dissenting in part and issuing a separate statement. Order on Reconsideration, CC Docket No. 87-313, Adopted: April 9, 1991. Released: April 17, 1991. 56 FR 21612 (May 10, 1991). By the Commission. Summary of Report and Order and Order on Further Reconsideration This is a summary of the Commission's Report and Order and Supplemental Notice of Proposed Rulemaking in Amendments of part 69 of the Commission's Rules Relating to the Creation of Access Charge Subelements for Open Network Architecture, CC Docket No. 89-79 and Order on Further Reconsideration in Policy and Rules Concerning Rates for Dominant Carriers, CC Docket No. 87-313; FCC 91-186, Adopted: June 13, 1991 and Released: July 11, 1991. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Dockets Branch (room 230), 1919 M St., NW., Washington, DC. The complete text of this decision may also be purchased from the Commission's copy contractor, Downtown Copy Center, (202) 452-1422, 1411 21st St., NW, Washington, DC 20037. The Commission has amended its part 69 access charge rules to enable the Bell Operating Companies (BOCs), and other local exchange carriers (LECs) desiring to implement Open Network Architecture (ONA), to offer unbundled ONA services. This represents another major step towards the creation of an unbundled ONA environment, which should promote efficient and innovative use of the network by enhanced service providers. The BOCs must file tariffs on or before November 1, 1991, on 90 days' notice, to provide the initial ONA offerings. The Commission also modified the interim pricing test for new services adopted in the LEC Price Cap Reconsideration Order. The modified test continues to provide protection against excessive new service prices by requiring price cap LECs to provide cost studies for all new service prices, including those of their initial basic service elements (BSEs) and basic serving arrangements (BSAs). However, the Commission modified the pricing rules to give price cap LECs some additional flexibility. As part of the implementation of ONA, the Commission ordered the BOCs to replace existing feature groups with BSE features and functions and the underlying BSA access arrangements. However, because interexchange carriers (IXCs) said they would need time to adjust their ordering and billing systems to handle such a modification, the Commission provided a transaction period during which the feature groups will continue to be available alongside the unbundled BSEs and BSAs. This will promote the timely implementation of ONA, while avoiding unnecessary disruptions to IXCs. The BOCs will tariff all BSEs listed in approved ONA plans and will be permitted to tariff additional BSEs approved under an expedited review process. In addition, BOCs will tariff one trunkside and one lineside switched access BSA and a number of special access BSAs. BOCs that wish to offer additional switched access BSAs will be required to obtain waivers of the Commission's part 69 rules. With respect to the cost showing for "new" services introduced by price cap LECs, the Commission said it will require the submission of cost studies, as in the interim approach of the LEC Price Cap Reconsideration Order. While LECs will be required to set their rates based on reasonable, consistent costing methodologies, they will be given the opportunity to select those methodologies, to justify reasonable non-uniform overhead loadings, and to seek higher returns on investment commensurate with the risks they assume. To address concerns that LECs might discriminate against ESPs that compete with LEC enhanced service operations, the Commission required the LECs to identify BSEs that will be used by LEC enhanced service operations. Once initial BSA/BSE prices become effective and adequate historical data have been generated, the services will be brought under price caps, subject to an additional disclosure requirement. The order does not modify the price cap bands and baskets, but establishes new rules requiring the BOCs to report the percentage of the demand for each BSE that their own usage represents, thereby revealing any discriminatory pricing patterns. This represents a relatively unburdensome way of constraining the ability of a BOC to raise the price of the BSEs used by its competitors while lowering the price of the BSEs used by the BOC enhanced service operators. The Commission retained, in its current form, the enhanced service provider (ESP) exemption for interstate access charges. It denied as unnecessary, in light of the adoption of the ONA pricing rules today, requests by Ameritech and Southwestern Bell for waivers of the part 69 access charge rules. List of Subjects in 47 CFR parts 61 and 69 Communications common carriers, Reporting and recordkeeping requirements, Telephone. Amendments to the Code of Federal Regulations Title 47 of the CFR, parts 61 and 69 are amended as follows: PART 61--TARIFFS 1. The authority citation for part 61 continues to read as follows: Authority: Sec. 4, 48 Stat. 1066, as amended; 47 U.S.C. 154. Interpret or apply sec. 203, 48 Stat. 1070; 47 U.S.C. 203. 2. Section 61.49 is amended by adding a new paragraph (h) to read as follows: s 61.49 Supporting information to be submitted with letters of transmittal for tariffs of carriers subject to price cap regulation. * * * * * (h) Each tariff filing by a local exchange carrier that introduces a new service that will later be included in a basket must also be accompanied by (1) The following, including complete explanations of the bases for the estimates. (i) A study containing a projection of costs for a representative 12 month period; and (ii) Estimates of the effect of the new tariff on the traffic and revenues from the service to which the new tariff applies, the carrier's other service classifications, and the carrier's overall traffic and revenues. These estimates must include the projected effects on the traffic and revenues for the same representative 12 month period used in paragraph (h)(1)(i) of this section. (2) Working papers and statistical data. (i) Concurrently with the filing of any tariff change or tariff filing for a service not previously offered, the Chief, Tariff Review Branch must be provided two sets of working papers containing the information underlying the data supplied in response to paragraph (h)(1) of this section, and a clear explanation of how the working papers relate to that information. (ii) All statistical studies must be submitted and supported in the form prescribed in s 1.363 of the Commission's rules. PART 69--ACCESS CHARGES 1. The authority citation for part 69 continues to read as follows: Authority: Secs. 4, 201, 202, 203, 205, 218, 403, 48 Stat. 1066, 1070, 1072, 1077, 1094, as amended, 47 U.S.C. 154, 201, 202, 203, 205, 218, 403. 2. Section 69.2 is amended by adding the following new paragraph (mm) to read as follows: s 69.2 Definitions. * * * * * (mm) Basic Service Elements are optional unbundled features that enhanced service providers may require or find useful in the provision of enhanced services, as defined in Amendments of part 69 of the Commission's rules relating to the Creation of Access Charge Subelements for Open Network Architecture, Report and Order, 6 FCC Rcd , CC Docket No. 89-79, FCC 91-186 (1991). 3. Section 69.4 is amended by revising paragraph (b) to read as follows: s 69.4 Charges to be filed. * * * * * (b) Except as provided in subpart C of this part, in ss 69.4 (c) and (d), and in s 69.118, the carrier's carrier charges for access service filed with this Commission shall include charges for each of the following elements: (1) Limited pay telephone; (2) Carrier common line; (3) Local switching; (4) Information; (5) Common transport; (6) Dedicated transport; and (7) Special access. * * * * * 4. Section 69.106 is amended by revising paragraph (a) to read as follows: s 69.106 Local switching. (a) Except as provided in s 69.118, charges that are expressed in dollars and cents per access minute of use shall be accessed upon all interexchange carriers that use local exchange switching facilities for the provision of interstate or foreign services. * * * * * 5. Section 69.107 is amended by revising paragraphs (a) and (b) to read as follows: s 69.107 Equal access. (a) A monthly charge that is expressed in dollars and cents either per Feature Group D trunk, per presubscribed equal access line, or per trunk line that is receiving from a local exchange switch service that is substantially equivalent to the access provided for MTS or WATS, shall be assessed by telephone companies that implement an Equal Access element as provided in s 69.4(d) upon all interexchange carriers for either the interstate and foreign Feature Group D access service trunks the interexchange carriers uses, the interstate and foreign access service trunk lines receiving service substantially equivalent to the access provided for MTS or WATS from a local exchange switch, or the presubscribed equal access lines the carrier serves. (b) A monthly charge per Feature Group D trunk or per trunk line that is receiving from a local exchange switch service that is substantially equivalent to the access provided for MTS or WATS shall be computed by dividing the projected annual revenue requirement for the Equal Access element by twelve times the projected annual average number of the total of interstate and foreign Feature Group D access service trunks and interstate and foreign access service trunk lines receiving service substantially equivalent to the access provided for MTS or WATS from a local exchange switch. * * * * * 6. Section 69.109 is amended by revising paragraph (b) to read as follows: s 69.109 Information. * * * * * (b) Except as provided in s 69.118, if such connections are maintained exclusively by carriers that offer MTS, the projected annual revenue requirement for the Information element shall be divided by 12 to compute the monthly assessment to such carriers. * * * * * 7. Section 69.111 is amended by revising paragraph (a) to read as follows: s 69.111 Common transport. (a) Except as provided in s 69.118, a charge that is expressed in dollars and cents per access minute shall be accessed upon all interexchange carriers that use (1) Switching or transmission facilities that are apportioned to the Common Transport element for purposes of apportioning net investment, or (2) Equivalent facilities offered by carriers subject to price cap regulation as the term is defined in s 61.3(v) of this chapter. * * * * * 8. Section 69.112 is amended by revising paragraph (b) introductory text to read as follows: s 69.112 Dedicated transport. * * * * * (b) Appropriate subelements shall be established for the use of interface arrangements. Except as provided in s 69.118, charges for such subelements shall be assessed and computed as follows: * * * * * 9. Section 69.113 is amended by revising paragraph (a) and adding a new paragraph (e) to read as follows: s 69.113 Non-premium charges for MTS-WATS equivalent services. (a) Charges that are computed in accordance with this section shall be assessed upon interexchange carriers or other persons that receive access that is not deemed to be premium access (as this term is defined in s 69.105(b)(1)) in lieu of carrier charges that are computed in accordance with ss 69.105, 69.106, 69.111, 69.112 and 69.118. * * * * * (e) The non-premium charge for any BSEs in transport or local switching shall be computed by multiplying the premium charge for the corresponding BSEs by . 45. 10. New s 69.118 is added to read as follows: s 69.118 Traffic sensitive switched services. Notwithstanding ss 69.4(b), 69.106, 69.109, 69.111, and 69.112, telephone companies subject to the BOC ONA Order, 4 Fcd Rcd 1 (1988), shall, and other telephone companies may, establish approved Basic Service Elements as provided in amendments of part 69 of the Commission's rules relating to the Creation of Access Charge Subelements for Open Network Architecture, Report and Order, 6 FCC Rcd G7XXX, CC Docket No. 89-79, FCC 91-186 (1991). Telephone companies shall take into account revenues from the relevant Basic Service Element or Elements in computing rates for the Local Switching, Common Transport, Dedicated Transport, and/or Information elements. 11. New s 69.119 is added to read as follows: s 69.119 Basic service element expedited approval process. The rules for filing comments and reply comments on requests for expedited approval of new basic service elements are those indicated in s 1.45 of the rules, except as specified otherwise. 12. Section 69.205 is amended by revising paragraph (a) to read as follows: s 69.205 Transitional premium charges. (a) Charges that are computed in accordance with this section shall be asessed upon interexchange carriers or other persons that receive premium access in lieu of carrier charges that are computed in accordance with ss 69.106, 69.111, 69.112, and 69.118 of this part if any carrier or other person does not receive premium access, as this term is defined in s 69.105. * * * * * Federal Communications Commission. William F. Caton, Acting Secretary. [FR Doc. 91-17340 Filed 7-23-91; 8:45 am] BILLING CODE 6712-01-M 56 FR 33879-01 END OF DOCUMENT 56 FR 33891-01 PROPOSED RULES FEDERAL COMMUNICATIONS COMMISSION 47 CFR Parts 61 and 69 [Docket Nos. 89-79, 87-313, FCC 91-186] Creation of Access Charge Subelements for Open Network Architecture and Policy and Rules Concerning Rates for Dominant Carriers Wednesday, July 24, 1991 AGENCY: Federal Communications Commission (FCC). ACTION: Proposed rule. SUMMARY: The Commission requests comments on the pricing rules that should apply to price cap local exchange carriers (LECs) with respect to the rates they charge for future unbundled ONA elements that qualify as restructured services under price cap rules. Unless the current rules are modified, price cap LECs would be required to make the showing for restructured services, and demonstrate that the restructured service continues to comply with the price cap index and applicable banding rules. The Commission seeks to determine whether this showing is sufficient to ensure that the ONA element prices are reasonable. DATES: Comments must be filed by August 26, 1991. Reply comments are due by September 25, 1991. ADDRESSES: Federal Communications Commission, Washington, DC 20554. FOR FURTHER INFORMATION CONTACT:Mark S. Nadel, Common Carrier Bureau, (202) 632-6363. SUPPLEMENTARY INFORMATION: Paperwork Reduction Act The following collection of information contained in this proposed rule has been submitted to the Office of Management and Budget for review under Section 3504(h) of the Paperwork Reduction Act (44 U.S.C. 3504(h)). Copies of this submission may be purchased from the Commission's copy contractor, Downtown Copy Center, (202) 452-1422, 1114 21st St., NW., Washington, DC 20036. Persons wishing to comment on this collection of information should direct their comments to Jonas Neihardt, (202) 395-4814, Office of Management and Budget, Room 3235 NEOB, Washington, DC 20503. A copy of any comments filed with the Office of Management and Budget should also be sent to the following address at the Commission: Federal Communications Commission, Office of Managing Director, Paperwork Reduction Project, Washington, DC 20554. For further information contact Judy Boley, 202-632-7513. Title: Part 61--Tariffs (Other Than Tariff Review Plan). OMB Number: 3060-0298. Respondents: Businesses. Frequency of Response: On Occasion. Estimated Annual Burden: 696,950. Needs and Uses: This rulemaking will consider whether additional cost support is required by regulators to help insure that LECs do not partake in price discrimination. If it is adopted, the additional support would be used by regulators to permit them to make more effective evaluations of the relative prices of various price cap LEC ONA services, so as to ensure that rates are reasonable. Background CC Docket No. 89-79: Notice of Proposed Rulemaking, Amendments of part 69 of the Commission's Rules Relating to the Creation of Access Charge Subelements for Open Network Architecture, CC Docket No. 89-79. Adopted: March 30, 1989. Released: May 9, 1989. 54 FR 20873 (May 15, 1988). CC Docket No. 87-313: Notice of Proposed Rulemaking, Policy and Rules Concerning Rates for Dominant Carriers, CC Docket No. 87-313. Adopted: August 4, 1987. Released: August 21, 1987. 52 FR 33962 (Sept. 9, 1987). By the Commission. Further Notice of Proposed Rulemaking, CC Docket No. 87-313. Adopted: May 12, 1988. Released: May 23, 1988. 53 FR 22356 (June 15, 1988). By the Commission. Supplemental Notice of Proposed Rulemaking, CC Docket No. 87- 313. Adopted: March 8, 1990. Released: March 12, 1990. 55 FR 12526 (Apr. 4, 1990). By the Commission. Second Report and Order, CC Docket No. 87-313. Adopted: September 9, 1990. Released: October 4, 1990. 55 FR 42375 (Oct. 19, 1990). By the Commission. Commissioner Duggan concurring in part and dissenting in part and issuing a separate statement. Order on Reconsideration, CC Docket No. 87-313, Adopted: April 9, 1991. Released: April 17, 1991. 56 FR 21612 (May 10, 1991). By the Commission. Summary of Supplemental Notice of Proposed Rulemaking This is a summary of the Commission's Supplemental Notice of Proposed Rulemaking in Amendments of Part 69 of the Commission's Rules Relating to the Creation of Access Charge Subelements for Open Network Architecture, CC Docket No. 89-79 and Order on Further Reconsideration in Policy and Rules Concerning Rates for Dominant Carriers, CC Docket No. 87-313; FCC 91-186, Adopted: June 13, 1991 and Released: July 11, 1991. The full texts of Commission decisions are available for inspection and copying during normal business hours in the FCC Dockets Branch (Room 230), 1919 M St., NW., Washington, DC. The complete text of this Supplemental Notice may also be purchased from the Commission's copy contractor, Downtown Copy Center, (202) 452-1422, 1114 21st St., NW., Washington, DC 20036. The Supplemental Notice solicits comment on whether the existing price cap rules for restructured services should be supplemented with additional rules directed at the increased danger of discrimination inherent in Open Network Architecture (ONA) services. The public is asked to comment on whether local exchange carriers should be required to make the cost showings required for new services when they introduce restructured ONA services. Alternatively, price cap LECs would only be subject to the normal constraints of the restructured services test. Any cost showings submitted by the LECs will be used by the Commission to determine the reasonableness of rates. With respect to the cost showing for "new" services introduced by price cap LECs, the Commission said it will require the submission of cost studies, as in the interim approach of the LEC Price Cap Reconsideration Order. While LECs will be required to set their rates based on a reasonable, consistent costing methodology, they will be given the opportunity to select that methodology, to justify reasonable non-uniform overhead loadings, and to seek higher returns on investment commensurate with the risks they assume. To address concerns that LECs would discriminate against ESPs that compete with LEC enhanced service operations, the Commission required the LECs to identify BSEs that will be used by LEC enhanced service operations. List of Subjects in 47 CFR Parts 61 and 69. Communications common carriers, Reporting and recordkeeping requirements, Telephone. Federal Communications Commission. William F. Caton, Acting Secretary. [FR Doc. 91-17341 Filed 7-23-91; 8:45 am] BILLING CODE 6712-01-M 56 FR 33891-01 END OF DOCUMENT <<<< insert standard disclaimer here >>>> mike.riddle@inns.omahug.org | Nebraska Inns of Court bc335@cleveland.freenet.edu | +1 402 593 1192 (Data/Fax) Sysop of 1:285/27@Fidonet | V.32/V.42bis / G3 Fax