Agenda Date: August 12, 1998 Agenda Item: Dockets: UT-980774- Notice of Intent to Adopt Rules and Notice of Opportunity to Comment Equal Access Dialing Parity Requirements UT-980340- Staff Investigation into the Implementation of Equal Access Dialing Parity Requirements by U S WEST Company Name: Telecommunications Companies-General U S WEST Communications, Inc. Staff: Glenn Blackmon, Assistant Director-Telecommunications Jing Roth, Regulatory Consultant Recommendation: (1) Issue a complaint requiring U S WEST Communications, Inc., (USWC) to implement intraLATA dialing parity in Docket UT-980340 (2) Discontinue the rulemaking in Docket UT-980774. Discussion: Section 251(b)(3) of the federal Telecommunications Act of 1996 requires that every local exchange telephone company provide its customers with dialing parity. Dialing parity means that customers can reach their preferred telecommunications carrier without having to dial extra numbers. Customers already have dialing parity for interLATA calls (such as from Seattle to Spokane or from Bellingham to Chicago). For intraLATA calls, the customers of GTE and Sprint/United have dialing parity, but customers of U S WEST and the small independent companies do not have dialing parity. On June 15, 1998, the Commission issued a CR-101 to solicit comments on whether any state implementation rules are warranted and, if so, whether the WUTC should adopt in whole or part of the FCC rules. Based on the comments received, staff believes that statewide rules are not necessary. With the exception of U S WEST, all other telecommunications companies either have already implemented intraLATA equal access dialing parity or have indicated the intent to implement dialing parity on or before February 8, 1999. The purpose of this complaint against U S WEST is to enforce the requirement in Section 251 (b)(3) of the federal Telecommunications Act of 1996 which requires every local exchange telephone company provide its customers with dialing parity. US West contends that Section 271 of the federal act exempts it from the dialing parity requirement unless the Commission orders it to do so. In its comments filed on July 10, 1998, U S West stated that “the Act simply contains a prohibition on what the state can do for three years. Thereafter, the state may require, and may decline to require, intraLATA dialing parity.” US West also asserts that the Commission should not order intraLATA dialing parity for it until it is allowed by the Federal Communications Commission to provide long distance service outside the LATA boundaries. The company argues that it would suffer a revenue loss of approximately $2 per customer per month. Staff believes that US West’s revenue loss is probably overstated but does not disagree that the company will lose revenue if customers are given the opportunity to choose a long distance company. Prior experience suggests that about 40% of customers will choose a carrier other than US West. However, Staff does not believe that this should be a reason to withhold choice from customers; indeed, the fact that so many customers would choose another carrier illustrates the importance of offering customers a choice. The revenue loss to US West, therefore, should be considered separately and subsequently from the decision about whether to implement dialing parity. Staff is willing to work with US West, Public Counsel, and any other interested parties in determining how much revenue US West is likely to lose and whether any part of that loss should be made up by increasing other rates. The goal for implementation of intraLATA dialing parity is to provide Washington consumers with more choices for intraLATA toll services, eliminate the hassle of dial-around, and promote competition. The best approach to achieve that goal is to issue a complaint against USWC to enforce the dialing parity requirement and to address with any revenue effects separately.