udith St. Ledger-Roty and Lee Rau

Inherent in the co-carrier status the Federal Communications Commission has expressly granted the wireless industry, including paging, cellular and personal communications services, is the right to fair and reasonable interconnection with the local exchange carriers.

Among other things, this interconnection must include access to telephone numbers on a fair, reasonable and non-discriminatory basis, and the right of the wireless carriers to reasonable compensation for the termination of calls originating over local exchange facilities. In decisions rendered this year, the FCC, as well as certain states, has expressly rejected the unreasonable discrimination the LECs in their role as numbering plan administrators have proposed in the allocation of telephone numbers. On the other hand, the only decision rendered thus far with respect to compensation is a tentative decision by the state, one that ignores the co-carrier status to which the wireless industry is entitled, and for which it has achieved federal recognition.

Decisions recognize equality

In response to a petition filed by three paging carriers, the FCC has held that number administrators (currently Bellcore, and the Bell operating companies) must make telephone numbers available in a technology-neutral fashion, and on a timely basis so as to avoid imposing any undue burden on any segment of the industry. The FCC has also begun a process to replace the local exchange telephone companies as numbering plan administrators, replacing them with an independent, third-party administrator, unaffiliated with any carrier.

According to the FCC, “we find the selective and asymmetric treatment of carriers in the administration of telephone numbers resources is an unjust and unreasonable practice that violates Section 201(b) of the [Communications] Act.” In the FCC order, Ameritech’s plan for a wireless overlay was declared unlawful.

Specifically, the FCC’s order declared unlawful mandatory wireless overlays, such as the one proposed by Ameritech for the Chicago suburbs (area code relief for 708). The wireless overlay would have relegated wireless carriers to less desirable codes, thereby segregating carriers’ number utilization based on the technology used to provide service.

In March 1995, the Illinois Commerce Commission echoed the FCC’s sentiments, declaring wireless overlays unlawful. As of late August 1995, the California Public Service Commission had joined their ranks, making it unanimous that every commission that has considered mandatory wireless overlay proposals before them has found them unlawful.


The failure to timely adopt code relief plans results in proposals that discriminate against wireless carriers.

There are at least two states which bear watching to see if they ultimately adopt defacto mandatory wireless overlays, or other numbering plan implementation processes, in contravention of the FCC’s guidelines as clearly articulated, and thus violate the wireless carrier’s co-carrier rights to equal treatment.

The first is the state of Florida, which is being urged by BellSouth Corp. to require paging carriers to use the new area code (954) providing 305 relief in the South Florida area five or more months before the wireline carriers, and perhaps nine months or more before most cellular carriers. Also of substantial concern is that paging customers would be required to go from a mandatory 7-digit dialing pattern to a mandatory 10-digit pattern, and then from a 10-digit dialing pattern back to a mandatory 7-digit dialing plan on a flash-cut basis, e.g., at the stroke of an hour, all calls would have to be dialed with 7 digits. No other carrier classification faces that customer impact, thereby disproportionately burdening one segment of the industry.

The second is the state of Missouri, where the Missouri Public Service Commission, in a decision adopting a split for St. Louis, nonetheless requested carriers to consider whether wireless overlays would be a lawful, acceptable option to explore in further relief rounds.

Although neither of these states may ultimately adopt any form of mandatory overlay, or otherwise unreasonably discriminate against wireless carriers, the mere existence of their continued discussion serves as a reminder that the historical view-that landline local exchange service is to be protected, with wireless services still viewed as a secondary, discretionary and thus less important service-still exists in some states. And what this means is that states still may approve numbering plans that allocate numbers on a preferential basis to the incumbent local exchange carriers, thereby implicitly denying wireless carriers their co-carrier status.

The majority of states have opted for neutral splits, in some cases, e.g., Illinois, Georgia, Florida and California, after lengthy proceedings. However, even there, delays in initiating relief proposals, the inordinate time that it is taking to resolve disputes over relief alternatives and pressures to extend permissive dialing periods once last-minute splits have been adopted are all contributing to an artificial, serious and unnecessary number shortage in various parts of the country. What is happening is that, when state commissions adopt splits as the relief option, there is tremendous pressure to extend permissive dialing periods once those splits have been implemented.

Implementation delays are occurring to a large extent because of the industry’s and the affected communities’ own inability to decide where a split line should be drawn, and permissive dialing periods are being extended because of business customer reaction to the telephone equipment routing problems that are being created by the use of the new interchangeable area codes.

A good example is what is happening in Illinois. Ameritech, which had assured the Illinois Commerce Commission that it could implement the eleventh hour double split that the commission ordered for the 708 area code, later petitioned for a rehearing citing unanticipated implementation problems. Even after that, further implementation problems arose when still more unanticipated technical problems required 7-digit telephone number changes for 30,000 subscribers. The City of Shaumburg filed suit over those changes despite the fact that it was presumably one of the municipal conference members that proposed the split line in the first place.

Similarly, in both Arizona and Washington, public pressure forced the extension of permissive dialing in the 602/520 and 206/360 splits respectively and, consequently, put carriers and consumers at risk of running out of numbers.

In California, the inability of interested parties to agree on where to draw the line for the split is prompting consideration on the part of some of the affected municipalities to return to the California Public Utilities Commission and ask for an all service overlay instead. Independent of this possibility, Pacific Bell has already petitioned for reconsideration of the 310 split order claiming that the remaining time before 310 numbers exhaust will not permit implementation of a split. There are also reports that the staff of the Florida Public Service Commission is reconsidering whether the 305/954 split ordered by that commission is, in fact, feasible.

In each of these instances, the fundamental objective to provide numbers on a timely basis articulated by the FCC as the goal of a competitively neutral administration of the North American Numbering Plan is being frustrated. This will create pressure in the state commissions to preserve the local exchange carrier’s number resources, or grant preferential numbers, even if it is at the expense of its wireless service competitors, threatening to violate the wireless carrier’s co-carrier rights once again.

No reasonable compensation

In the numbering context, where state after state has explicitly affirmed wireless carrier’s co-carrier rights, the only s
tate to consider the compensation issue this year in the wireless context-Connecticut-has relegated wireless carriers to a subscriber status. Unlike in the numbering context, the FCC and numerous states have recognized that co-carriers are entitled to equal treatment.

Connecticut has tentatively concluded that wireless carriers have no present entitlement, in contravention of the FCC’s ruling that all commercial mobile service providers are entitled to compensation for terminating calls originated over the wireline local exchange network.

Connecticut, through its Department of Public Utilities adopted a four-prong test which, at a minimum, must be met by any carrier in order to be entitled to compensation and which cannot be met by wireless carriers for the foreseeable future. In a nutshell, according to the Connecticut department, to be entitled to mutual compensation, common carriers must be in the business of providing local exchange services under its jurisdiction; be a certified local exchange carrier under the department’s requirements; both originate and terminate traffic, and offer service that is a substitute for local exchange service, and not an ancillary service.

The Connecticut initial decision fails to comply with the FCC’s mandate, depriving wireless carriers of their co-carrier status for purposes of compensation within that state. Rather, the initial decision indirectly makes clear the view that at least paging carriers are only subscribers to the network, and not co-carriers, by equating the paging services offered to private branch exchanges.

According to the Commission, “Paging service is only useful because the local exchange system is in place to make paging work. Just as there would be no PBX services without the local network to initiate a call, there would be no PBX service.” In the department’s view, “if a service cannot be provided without underlying local exchange service, then it is not eligible for mutual compensation.”

Obviously, under this sort of analysis, wireless carriers will likely never be entitled to compensation because the services they offer are part, but only part of the larger network of networks, all of which need to be interconnected for any carrier to offer ubiquitous service.

Notwithstanding the Connecticut public utilities department’s initial decision, this author believes that the wireless industry needs to adopt a uniform model of interconnection and compensation which expressly recognizes the co-carrier status of wireless carriers, and puts to rest the remnants of any perception that the wireless-LEC relationship is anything other than co-carrier to co-carrier.

This means discarding old interconnection facilities concepts which imbed in them the requirement that wireless carriers pay the LECs for landline facilities the LECs use in terminating their traffic over wireless network.

Ultimately, the wireless carriers and the landline carriers should establish meet points between their networks, in which the only revenues flowing back and forth being those revenues that compensate for the termination of traffic over the others’ network.

For example, a cellular carrier would pay the LEC compensation for calls originated by the cellular carrier and terminated by the landline carrier. A landline carrier would compensate the cellular carrier for calls originated over its network and terminated on the cellular network. But the cellular carrier would generally not pay the local exchange carrier for the local exchange carrier’s costs in originating the traffic over the landline network, which is what happens today.

It is only when such a model underlies the interconnection between wireless carriers and LECs that co-carrier status will be accomplished. Thus, to achieve true co-carrier interconnection status, wireless carriers still have a long way to go.

Judith St. Ledger-Roty and Lee Rau are both partners at the law firm of Reed Smith Shaw & McClay, specializing in federal and state telecommunications law. St. Ledger-Roty also represents wireless messaging companies.


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