In the matter of the commission’s before the policies concerning presubscribed public service commission intralata toll dialing. Of maryland

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ORDER NO. 74788




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* CASE NO. 8761

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On June 17, 1998, American Telephone and Telegraph of Maryland (“AT&T-MD”) filed a letter requesting that we schedule a conference to resolve technical issues prior to implementation of intraLATA toll presubscription on February 8, 1999. In response, by letter filed July 6, 1998, Bell Atlantic-Maryland, Inc. (“BA-MD”) stated that no conference was necessary since BA-MD’s Presubscription Implementation Plan approved by the Commission on May 23, 1997 provides that BA-MD will implement presubscription “coincident with its provision of in-region interLATA toll services in Maryland” and not by any date certain. Moreover, BA-MD contended that the technical issues were either detailed in the implementation plan or have been resolved in other Bell Atlantic states where presubscription has already been implemented.

In response, AT&T-MD filed a petition on August 5, 1998, requesting that we direct BA-MD to implement intraLATA toll presubscription on February 8, 1999. Relying on the Telecommunications Act of 1996 (“1996 Act”), its interpretation of our previous Order, and BA-MD public statements, AT&T-MD urged the Commission to direct BA-MD to implement intraLATA toll presubscription on February 8, 1999. MCI Telecommunications Corporation (“MCI”), the Maryland Office of People’s Counsel (“OPC”), the Telecommunications Resellers Association (“TRA”) and the Competitive Telecommunications Association (“CompTel”) filed comments supporting AT&T-MD’s position and urging the Commission to act.

On September 21, 1998, BA-MD filed its opposition to AT&T-MD’s petition. BA-MD claims that we rejected the approach of ordering intraLATA presubscription by February 8, 1999 and approved the BA-MD plan to implement intraLATA toll presubscription coincident with BA-MD’s entry into the in-region interLATA toll market. On October 6, 1998, AT&T-MD replied to BA-MD’s opposition. AT&T-MD renewed its former arguments and contended that BA-MD’s position was contrary to the 1996 Act, this Commission’s Orders and BA-MD public statements.


The seeds of the current controversy were planted by Judge J. Harold Greene’s Modification of the Final Judgment (“MFJ”), which was issued to resolve the Department of Justice’s antitrust litigation against the American Telephone and Telegraph Company (“AT&T”).1 The MFJ established seven regional Bell operating companies (“RBOCs”) and prohibited these companies from providing toll service between LATAs2 and between states. Thus, local exchange company subsidiaries of the RBOCs, such as BA-MD, can only provide toll service within LATAs. As a result of this decision, AT&T-MD, a subsidiary of the post-divestiture AT&T, applied for and was approved to become the provider of interLATA toll service within Maryland.

In several decisions issued after the MFJ, this Commission authorized other companies to begin providing toll service within Maryland.3 These decisions allowed companies to provide interLATA toll service in competition with AT&T-MD and intraLATA toll service in competition with BA-MD. Decisions by the Federal Communications Commission (“FCC”) permitted customers to preselect an interexchange telephone company (“IXC”) to be their one-plus carrier for purposes of interLATA and interstate toll telephone calls. Since BA-MD could not offer interLATA toll service while its IXC competitors could, the Commission decided that BA-MD’s customers would be presubscribed to BA-MD’s intraLATA toll services.4 However, for any intraLATA toll call placed in Maryland, customers could use the toll services of an IXC by dialing a Carrier Access Code before dialing the number they are trying to reach.

In 1994, the Commission approved the applications of several competitive local exchange companies (“CLECs”) to provide local exchange services to customers in Maryland.5 Next, the Commission determined the terms and conditions under which the CLECs could provide local exchange service. Among other matters, the Commission allowed CLECs to provide one-plus intraLATA toll services to their own local service customers, until such time as BA-MD is required to offer its customers a choice through intraLATA presubscription.6

IntraLATA presubscription issues are raised by the 1996 Act, which contains provisions relating to dialing parity. The 1996 Act provided that RBOCs would no longer be prohibited from providing interLATA service once their respective local exchange market was competitive. To achieve local exchange market competition, the 1996 Act places certain obligations on incumbent local exchange carriers (“ILEC’s”), including the requirement that they provide dialing parity to CLECs. 47 USC §251(b) provides that each local exchange carrier has certain duties, including:

(3) Dialing parity: The duty to provide dialing parity to competing providers of telephone exchange service and telephone toll service, and the duty to permit all such providers to have nondiscriminatory access to telephone numbers, operator services, directory assistance and directory listing, with no unreasonable dialing delays.

Provisions specifically relating to intraLATA toll prescription are contained in 47 USC §271. This section of the 1996 Act requires Bell operating companies ("BOC”), such as BA-MD, to provide intraLATA toll dialing parity throughout the state coincident with the approval and exercise of their authority to offer interLATA services within that state.7 This section also limited a state’s ability to order intraLATA presubscription. Specifically, 47 USC §271(e)(2)(B) states:

Limitations – Except for single-LATA States and States that have issued an order by December 19, 1995 requiring a Bell operating company to implement dialing parity, a State may not require a Bell operating company to implement intraLATA toll dialing parity in that State before a Bell operating company has been granted authority under this section to provide interLATA services origination in that State or before 3 years after the date of enactment of the Telecommunications Act of 1996, whichever is earlier . . ..

On August 8, 1996, in response to the 1996 Act’s dialing parity provisions, the FCC required each LEC to implement toll dialing parity on the earlier of either February 8, 1999, or the date on which the LEC is allowed to provide in-region, interLATA or interstate toll services in that State. To further this goal, the FCC required each LEC to submit plans to its State regulatory commission setting forth the LEC’s proposals for implementing toll dialing parity.8

On January 13, 1997, BA-MD filed its Presubscription Implementation Plan with the Commission pursuant to the FCC’s Second Report.9 BA-MD’s plan stated that it would offer intraLATA presubscription when it begins offering in-region interLATA toll services in Maryland. The Commission considered these filings at its Administrative Meeting of February 12, 1997 and issued Order No. 73481 on May 23, 1997.

In this order, the Commission specifically noted that the FCC’s Second Report was on appeal to the U.S. Court of Appeals for the Eighth Circuit. Thus, the Commission determined that the decision would be issued under its state authority and in fulfillment of the toll dialing parity requirements of the 1996 Act.10 The Commission approved the implementation plans subject to certain changes discussed in the Order.11

The Commission determines that intraLATA toll presubscription need not necessarily await BA-MD’s receipt of approval to enter the in-region interLATA market. However, we also are not prepared to order presubscription by February 8, 1999.

The 1996 Act authorizes us to order intraLATA presubscription on February 8, 1999. It does not require the Commission to order presubscription by that date. We intend to hold a status conference involving all interested parties on January 6, 1999. At this conference, the parties should be prepared to discuss what issues remain unresolved and what actions the Commission needs to take in order to determine when presubscription should occur in Maryland.

IT IS, THEREFORE, this 16th day of December, in the year Nineteen Hundred and Ninety-nine, by the Public Service Commission of Maryland,

ORDERED: (1) That the Petition of AT&T-MD is denied;

(2) That this docket shall remain open for the purposes identified above.








1 United States v. Amer. Telephone & Telegraph Co., 552 F. Supp. 131 (D.C. Cir. 1982).

2 “LATA” is the telecommunications industry acronym for Local Access and Transport Area. Maryland has four LATAs covering Western Maryland, suburban Washington, D.C., the Baltimore area and the Eastern Shore.

3 See, e.g., Re MCI Telecommunications Corp., 75 Md. PSC 331 (1984).

4 See, e.g., Re Chesapeake and Potomac Telephone Company of Maryland, 84 Md. PSC 4, 47-48 (1993).

5 See, e.g., MFS Intelent of Maryland, Inc., 85 Md. PSC 38 (1994).

6 Re MFS Intelenet of Maryland, Inc., 86 Md. PSC 467, 483 (1995).

7 The 1996 Act allows a BOC to provide in-region interLATA toll service upon the FCC’s approval of the BOCs application. BOCs may seek authority to enter this market once their local exchange is competitive as evidenced by compliance with the 14-point checklist set out in the 1996 Act.

8 Second Report, para. 6.

9 Presubscription plans also were filed by Teleport Communications Group, Inc. (“TCG”) and MFS Intelenet of Maryland, Inc. (MFSI-MD”).

10 In the Matter of the Commission’s Policies Concerning Presubscribed IntraLATA Toll Dialing, Case No. 8761, Order No. 73481 (May 23, 1997). The dialing provisions of the FCC’s Second Report ultimately were overturned by the Eighth Circuit. California v. FCC, 124 F.2d 934 (8th Cir. 1997).

11 That aspect of BA-MD’s plan which stated that intraLATA toll presubscription would begin coincident with BA-MD’s entry into the interLATA market was not altered by the Order.

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