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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 ) In the Matter of) ) Implementation of the Local Competition )CC Docket No. 96-98 Provisions in the Telecommunications Act ) of 1996 ) ) Interconnection between Local Exchange ) CC Docket No. 95-185 Carriers and Commercial Mobile Radio ) Service Providers ) Second Order on Reconsideration Adopted: December 13, 1996Released: December 13, 1996 By the Commission. I. INTRODUCTION 1. In this Order, we address two petitions for reconsideration of the First Report and Order in this proceeding that question the Commission's rule concerning the obligation of incumbent local exchange carriers (LECs) to provide access to their operational support systems (OSS) functions by January 1, 1997. Because these petitions raise issues that are particularly time sensitive, we address them in this order. We will address petitions for reconsideration of other aspects of our August 8, 1996 Order, including other issues relating to access to OSS functions, in the future. 2. In the First Report and Order, the Commission concluded that an incumbent LEC is required to provide access to OSS functions pursuant to its obligation to offer access to unbundled network elements under section 251(c)(3) as well as its obligation to furnish access on a nondiscriminatory basis to all unbundled network elements and services made available for resale, under section 251(c)(3) and (c)(4). In this Second Order on Reconsideration, we decline to extend the January 1, 1997 date established in the First Report and Order. In the First Report and Order, we based our determination that incumbent LECs must provide access to OSS functions on two distinct requirements in section 251(c). First, under section 251(c)(3), for purposes of providing access to OSS functions as a network element, an incumbent must be able to provide, upon request, access to OSS functions pursuant to an implementation schedule developed through negotiation or arbitration. Second, under section 251(c)(3) and (c)(4), in order to comply with the requirement to provide nondiscriminatory access to unbundled elements and services for resale, incumbent LECs also are required, by January 1, 1997, to offer nondiscriminatory access to OSS functions. If an incumbent uses electronic interfaces for its own internal purposes, or offers access to electronic interfaces to its customers or other carriers, the incumbent must offer at least equivalent access to requesting telecommunications carriers. II. PETITIONS 3. Sprint and the Local Exchange Carrier Coalition (LECC) both request that the Commission extend the mandatory date for providing access to OSS functions to January 1, 1998. LECC asserts that the January 1, 1997 date "cannot realistically be met by all carriers for all support systems." Sprint urges the Commission to delay the compliance date and to require the industry to adopt and implement national standards for access to OSS. Both petitioners assert that the January 1, 1997 deadline does not realistically allow carriers to complete and implement national standards for access to OSS functions. In addition, several ex parte presentations made by incumbent LECs sought clarification of their obligations to provide access to OSS functions. 4. Several parties maintain that the Commission should retain the January 1, 1997 deadline for access to OSS functions. MCI opposes allowing industry to set national standards before requiring access to OSS functions, arguing that incumbent LECs will abuse the standards setting process to delay and postpone new entrants' electronic access to OSS functions. LECC responds that incumbents do not have an incentive to delay the standards-setting process, because implementation of national standards will avoid expensive manual or interim electronic solutions. Other parties support Sprint's and LECC's petitions to delay the date by which access to OSS functions is required. USTA and Ameritech argue that the Commission should not set a date certain for the establishment of national standards for access to OSS. III. DISCUSSION 5. Section 251(c)(3) of the Communications Act of 1934, as added by the Telecommunications Act of 1996, requires incumbent LECs "to provide, to any requesting telecommunications carriers for the provision of a telecommunications service, nondiscriminatory access to network elements on an unbundled basis at any technically feasible point on rates, terms, and conditions that are just, reasonable, and nondiscriminatory." The Commission was charged with identifying network elements and determining whether it is technically feasible for incumbent LECs to provide access to such elements on an unbundled basis. The Commission identified OSS functions as a network element, and determined that it is technically feasible for incumbent LECs to provide access to OSS functions for unbundling and resale. This determination reflects the Commission's conclusion that access to OSS functions is necessary for meaningful competition, and that failing to provide such access would impair the ability of requesting telecommunications carriers to provide competitive service. 6. In the First Report and Order, we concluded that obligations imposed by section 251(c)(3) to provide access to unbundled network elements require the incumbent LEC to make modifications to the extent necessary to accommodate a request from a telecommunications carrier. In the case of access to OSS functions, we recognized that, "although technically feasible, providing nondiscriminatory access to operations support systems functions may require some modifications to existing systems necessary to accommodate such access by competing providers." For example, incumbent LECs may need to decide upon interface design specifications and modify and test software. 7. We further concluded in the First Report and Order, based on the record, that January 1, 1997 was a reasonable date by which most, if not all, incumbent LECs could provide access to OSS functions. We concluded that: in order to comply fully with section 251(c)(3) an incumbent LEC must provide, upon request, nondiscriminatory access to operations support systems functions for pre-ordering, ordering, provisioning, maintenance and repair, and billing of unbundled network elements under section 251(c)(3) and resold services under section 251(c)(4). Incumbent LECs that currently do not comply with this requirement of section 251(c)(3) must do so as expeditiously as possible, but in any event no later than January 1, 1997. The Commission found it "reasonable to expect that by January 1, 1997, new entrants will be able to compete for end user customers by obtaining nondiscriminatory access to operations support systems functions." Thus, under our rules, incumbent LECs must have made modifications to their OSS necessary to provide access to OSS functions by January 1, 1997. 8. In order to comply with its obligation to offer access to OSS functions as an unbundled network element by January 1, 1997, an incumbent LEC must, at a minimum, establish and make known to requesting carriers the interface design specifications that the incumbent LEC will use to provide access to OSS functions. Information regarding interface design specifications is critical to enable competing carriers to modify their existing systems and procedures or develop new systems to use these interfaces to obtain access to the incumbent LEC's OSS functions. For example, if an incumbent LEC adopted the Electronic Data Interchange (EDI) standard to provide access to some or all of its OSS functions, it would need to provide sufficiently detailed information regarding its use of this standard so that requesting carriers would be able to develop and maintain their own systems and procedures to make effective use of this standard. As with all other network elements, the obligation arises only if a telecommunications carrier has made a request for access to OSS functions pursuant to section 251(c)(3), and the actual provision of access to OSS functions by an incumbent LEC must be governed by an implementation schedule established through negotiation or arbitration. 9. The issue of nondiscrimination under several provisions of sections 251(c)(3) and (c)(4) is independent of the issue of access to unbundled network elements under section 251(c)(3). We concluded in the First Report and Order that section 251 establishes a separate basis for requiring incumbent LECs to provide access to their OSS functions. Specifically, we found that the obligation to offer access to OSS functions was an essential component of an incumbent LEC's duty to offer nondiscriminatory access to all network elements under section 251(c)(3), and to provide services for resale without conditions or limitations that are unreasonable or discriminatory under section 251(c)(4). We observed that the "just, reasonable and nondiscriminatory" standard of section 251(c)(3) requires incumbent LECs to provide network elements on terms and conditions that "provide an efficient competitor with a meaningful opportunity to compete." Incumbent LECs must offer network elements on terms and conditions equally to all requesting carriers, and, where applicable, those terms and conditions must be equal to the terms and conditions on which an incumbent LEC provisions such elements to itself or its customers. Therefore, we held that the duty to provide nondiscriminatory access imposed by section 251(c)(3) and the duty to provide resale services under nondiscriminatory conditions imposed by section 251(c)(4) mandates equivalent access to OSS functions that an incumbent uses for its own internal purposes or offers to its customers or other carriers. By January 1, 1997, to the extent that an incumbent LEC provides electronic pre-ordering, ordering, provisioning, maintenance and repair, or billing to itself, its customers, or other carriers, the incumbent LEC must provide at least equivalent electronic access to requesting carriers in the provision of unbundled network elements or services for resale that it is obligated to provide pursuant to an agreement approved by the state commission. 10. In the First Report and Order, we noted the progress that had been made by several incumbent LECs toward meeting their obligation to provide nondiscriminatory access to OSS functions to requesting carriers. We are encouraged by reports that this progress has continued since the release of our Order. Further, for the most part, incumbent LECs have set implementation schedules for themselves that would bring them into compliance with section 251(c) by early 1997. Therefore, we find no basis in the record for postponing the date by which access to OSS must be offered. We believe that many individual carriers are taking actions to modify their systems to provide the necessary access to OSS functions required by the 1996 Act. We also note that several state arbitrations completed thus far have adopted schedules that require substantial implementation of access to OSS functions by January 1, 1997. 11. Although the requirement to provide nondiscriminatory access to network elements and services for resale includes an obligation to provide access to OSS functions no later than January 1, 1997, we do not anticipate initiating enforcement action against incumbent LECs that are making good faith efforts to provide such access within a reasonable period of time, pursuant to an implementation schedule approved by the relevant state commission. We do not, however, preclude initiating enforcement action where circumstances warrant. We further note that providing access to OSS functions is a critical requirement for complying with section 251, and incumbent LECs that do not provide access to OSS functions, in accordance with the First Report and Order, are not in full compliance with section 251. 12. We also note that, if an incumbent LEC with fewer than two percent of the subscriber lines nationwide is unable to offer nondiscriminatory access to OSS functions by January 1, 1997, it may seek a suspension or modification of this requirement from the relevant state commission. In addition, rural telephone companies are exempt from the requirements of section 251(c), as set forth in section 251(f)(1), except when and to the extent otherwise determined by state commissions. 13. Finally, it is apparent from arbitration agreements and ex parte submissions that access to OSS functions can be provided without national standards. We therefore reject the petitions of LECC and Sprint to delay the requirement to provide nondiscriminatory access to OSS functions until national standards have been fully developed. We conclude that such a requirement would significantly and needlessly delay competitive entry. In the First Report and Order, we stated that, in order to ensure continued progress in establishing national standards, we would "monitor closely the progress of industry organizations as they implement the rules adopted in this proceeding." We continue to encourage parties to develop national standards for access to OSS functions, but decline to condition the requirement to provide access to OSS functions upon the creation of such standards. IV. ORDERING CLAUSES 14. Accordingly, IT IS ORDERED that, pursuant to sections 1-4, 201-205, 214, 251, 252, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C.  151-154, 201- 205, 251, 252, and 303(r), the Second Order on Reconsideration is ADOPTED. 15. IT IS FURTHER ORDERED, pursuant to section 405 of the Communications Act of 1934, as amended, 47 U.S.C.  405, and section 1.106 of the Commission's rules, 47 C.F.R.  1.106 (1995), that the petitions for reconsideration filed by the Local Exchange Carrier Coalition and the Sprint Corporation are DENIED, to the extent that they seek deferral of the January 1, 1997 date regarding access to OSS functions. FEDERAL COMMUNICATIONS COMMISSION William F. Caton Acting Secretary