BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION ) In the Matter of ) ) MFS COMMUNICATIONS COMPANY, INC.’S ) DOCKET NO. UT-960323 ) Petition for Arbitration Pursuant to 47 U.S.C. ) § 252(b) of the Interconnection Rates, Terms and ) Conditions with U S West Communications, Inc. ) ) ) In the Matter of ) ) TCG SEATTLE ) DOCKET NO. UT-960326 ) Petition for Arbitration Pursuant to 47 U.S.C. ) § 252(b) of the Telecommunications Act of 1996. ) ) ) In the Matter of the Interconnection Agreement ) Between: ) ) ELECTRIC LIGHTWAVE, INC., and ) DOCKET NO. UT-960337 U S WEST COMMUNICATIONS, INC. ) ) Pursuant to 47 U.S.C. § 252. ) ) TESTIMONY OF HERBERT J. POZDRO ON BEHALF OF WORLDCOM TECHNOLOGIES, INC. (FORMERLY KNOWN AS MFS INTELENET, INC.) Q. PLEASE STATE YOUR NAME AND BUSINESS ADDRESS. A. My name is Herbert J. Pozdro. My business address is 1 Tower Lane, Suite 1600, Oakbrook Terrace, Illinois, 60181. Q. BY WHOM ARE YOU EMPLOYED AND WHAT ARE YOUR RESPONSIBILITIES? A. I am employed by WorldCom, Inc. and I am testifying on behalf of WorldCom Technologies, Inc. (“WorldCom”) (formerly known as “MFS Intelenet, Inc.”). I started working for WorldCom on January 5, 1998 as an ILEC Collocation Manager. In this position, I coordinate with US West and GTE regarding the opening of collocation sites in new service areas and the augmenting of existing sites. I attempt to ensure that projects are completed within established guidelines. Q. PLEASE SUMMARIZE YOUR PROFESSIONAL EXPERIENCE. A. I accepted a position with Middle States Telephone Company in Des Plaines, Illinois in 1960. Middle States was purchased by Central Telephone Company in 1965 and, over the following years, became part of the Centel Corporation (“Centel”). In 1993, Sprint and Centel merged, and I became a Sprint employee. On October 31, 1997, Sprint completed the sale of the Des Plaines serving area to Ameritech. I spent 37 years as an employee of the local telephone company for the Des Plaines/Park Ridge serving area. The majority of my career was spent in the Customer Services Departments in the local company. There was a four year period during which I was the Sales Manager for the Des Plaines operation with responsibility for business customers. My job included responsibility for the business service representative activities, sale of non-regulated services and equipment, customer training, system engineering, sale and installation of cellular equipment and sale of maintenance agreements. I have worked in the Installation and Repair (“I&R”) group (installing and maintaining residential service) and in the PBX I&R group (installing and maintaining business systems). I have controlled construction projects for the state of Illinois and supervised PBX work groups. From 1980 to 1989, I was a member of Centel’s “Illinois Staff,” which was responsible for all internal performance reporting. I managed the Illinois Staff from 1989 to 1997. For short periods of time, I had responsibility for the Illinois warehouses, vehicle maintenance, facilities and support (land and buildings) and Plant Service Center. During my last couple of years with Centel, I was the Illinois Staff representative working with CLECs (primarily MFS Communications Company, Inc.) as Centel worked to prepare implementation procedures that were agreeable to CLECs. This position provided me the opportunity to work on physical collocation (from an ILEC’s perspective) with MFS from the initiation of the collocation request through the time that the first test orders were processed. Q. WHAT IS THE PURPOSE OF YOUR TESTIMONY? A. My testimony addresses three of the points that the Commission raised in its Notice (dated February 26, 1998): (1) the reasonableness of reserved administrative space on the eighth and fourteenth floors of the Seattle Main central office; (2) the distinction between obsolete and useful central office equipment, and between declining utilization and spare capacity for growth; and (3) the reasonable timetable for US West to review requests for physical collocation and review of US West denials of requests for physical collocation. THE REASONABLENESS OF RESERVED ADMINISTRATIVE SPACE ON THE EIGHTH AND FOURTEENTH FLOORS OF THE SEATTLE MAIN CENTRAL OFFICE Q. HAVE YOU REVIEWED THE TESTIMONY OF LUKE MARCHIE AND ROBERT ANDERSON GIVEN ON SEPTEMBER 24, 1997 IN THIS PROCEEDING, REGARDING THE AVAILABILITY OF SPACE AT US WEST’S VARIOUS CENTRAL OFFICES? A. Yes, I have. Q. DO YOU ADOPT MR. MARCHIE’S AND MR. ANDERSON’S TESTIMONY AS YOUR OWN? A. Yes, I do. Q. EXACTLY WHAT PORTIONS OF MR. MARCHIE’S AND MR. ANDERSON’S TESTIMONY DO YOU ADOPT? A. I adopt their testimony that appears on transcript pages 178 through 223. Q. DO YOU AGREE WITH MR. MARCHIE’S AND MR. ANDERSON’S CONCLUSION THAT IT WOULD BE REASONABLE TO CONSOLIDATE ADMINISTRATIVE SPACE ON THE EIGHTH AND FOURTEENTH FLOORS OF THE SEATTLE MAIN CENTRAL OFFICE? A. Yes, I do. THE DISTINCTION BETWEEN OBSOLETE AND USEFUL CENTRAL OFFICE EQUIPMENT, AND BETWEEN DECLINING UTILIZATION AND SPARE CAPACITY FOR GROWTH Q. WHY IS IT IMPORTANT FOR THE COMMISSION AND THE PARTIES TO BE ABLE TO DISTINGUISH BETWEEN OBSOLETE AND USEFUL CENTRAL OFFICE EQUIPMENT? A. US West cannot seek an exemption from its duty to provide physical collocation under Section 251(c)(6) of the Communications Act of 1934, as amended by the Telecommunications Act of 1996, (“Act”) for central offices which have obsolete equipment occupying space that physical collocators could use. The storing of obsolete equipment is discriminatory toward competing carriers in light of the Act’s requirements to make space available. Q. WHEN SHOULD THE COMMISSION DEEM TELECOMMUNICATIONS EQUIPMENT IN A US WEST CENTRAL OFFICE TO BE OBSOLETE? A. The Commission should find that telecommunications equipment stored in a US West central office is obsolete when its functions are performed by newer equipment which also may perform a wider range of new functions and which meets capacity requirements for the foreseeable future. Q. HOW SHOULD THE COMMISSION DEAL WITH OBSOLETE EQUIPMENT IN US WEST CENTRAL OFFICES? A. The Commission should declare that the space which the obsolete equipment occupies is available for physical collocation and it is US West’s responsibility to remove that equipment in a timely manner to permit the use of that space for physical collocation. Q. WHAT DOES THE COMMISSION MEAN WHEN IT REFERS TO THE DISTINCTION BETWEEN DECLINING UTILIZATION AND SPARE CAPACITY FOR GROWTH? A. I believe that the Commission refers to the argument that US West needs less space for future growth (than it claims it needs) because competition in the local exchange market will lead to declining utilization of US West equipment. In other words, future US West customers may instead choose WorldCom or some other CLEC as their local service provider, thereby diminishing the need for additional capacity (and the space that it occupies) on US West’s part. Q. HOW MUCH SPARE CAPACITY DOES US WEST NEED FOR FUTURE GROWTH? A. US West needs spare capacity only for 2 years of future growth. In this industry, it is fruitless to attempt to provide more capacity because no one can predict what demand for telecommunications services will be more than 2 years into the future. Q. HOW SHOULD THE COMMISSION ASSESS DECLINING UTILIZATION OF CENTRAL OFFICE EQUIPMENT AND ITS IMPACT ON THE AMOUNT OF SPARE CAPACITY THAT US WEST NEEDS FOR FUTURE GROWTH? A. Declining utilization reinforces the conclusion that US West should employ a 2 year planning horizon for spare capacity. With other carriers seeking to serve the same market as US West, it would be impossible to forecast US West’s demand requirements more than 2 years into the future. THE REASONABLE TIMETABLE FOR US WEST TO REVIEW REQUESTS FOR PHYSICAL COLLOCATION AND REVIEW OF US WEST DENIALS OF REQUESTS FOR PHYSICAL COLLOCATION Q. WHAT IS A REASONABLE TIMETABLE FOR US WEST TO REVIEW REQUESTS FOR PHYSICAL COLLOCATION? A. At least for WorldCom, the most reasonable — indeed the required — timetable for US West to review collocation requests is set forth in Section VII.E of the parties’ interconnection agreement. Since the parties agreed to this section of the agreement, and did not arbitrate it, US West is bound to the timetable described below without regard to its appeal of collocation issues./ The relevant portion of the Joint Position Statement of the parties, which demonstrates that the collocation timetable was negotiated, is attached at Exhibit A./ Under the agreement, US West has 15 business days to confirm whether space is available at a central office in which WorldCom wishes to collocate. US West then has ten business days after that period (25 days from the initial request) to provide WorldCom with a quote of the collocation costs. At that point, WorldCom has 30 calendar days to review US West’s proposed collocation costs and, if it chooses, accept them (by sending its check for 50% of such costs). Once WorldCom has agreed to US West’s proposal, US West has 90 calendar days to provision the requested collocation arrangements. When US West completes its work, WorldCom pays the remaining 50% of collocation costs to US West and then begins the process of installing its equipment in the collocation space (which normally takes 30 calendar days). This is a reasonable time frame for US West to provide physical collocation to other carriers requesting physical collocation. Q. SHOULD THE COMMISSION ADOPT THIS TIMETABLE FOR ALL PARTIES? A. Only if other parties support such a ruling. Q. HAS US WEST ATTEMPTED TO TREAT A COLLOCATION REQUEST UNDER ITS NETWORK INTERCONNECTION UNBUNDLED ELEMENT REQUEST (“NIUER”) PROCESS? A. Yes. Q. WHAT IS THE NIUER PROCESS? A. It is a bona fide request process by which US West can make network elements available that it did not bind itself in the interconnection agreement with WorldCom to make available in the first instance. Q. IS PHYSICAL COLLOCATION A NETWORK ELEMENT THAT US WEST DID NOT SPECIFICALLY BIND ITSELF TO MAKE AVAILABLE IN THE INTERCONNECTION AGREEMENT WITH WORLDCOM? A. It most certainly is not such an element. US West specifically bound itself to provide physical collocation to WorldCom in Section VII.C.1 of the agreement between the parties. Q. DO YOU AGREE THAT US WEST SHOULD BE ABLE TO PROCEED WITH A COLLOCATION REQUEST UNDER THE NIUER PROCESS? A. No, I believe that US West is abusing the NIUER process. Q. WHY HAS US WEST ATTEMPTED TO USE THE NIUER PROCESS FOR REQUESTS FOR PHYSICAL COLLOCATION? A. The timetable is much longer. Q. WHAT EXACTLY IS THE TIMETABLE FOR A COLLOCATION REQUEST UNDER THE NIUER PROCESS? A. Once US West receives a request under the NIUER process, US West has 15 business days to acknowledge receiving the request and to ask for any missing information that it needs to process the request. Within 30 calendar days after receiving the request, US West must indicate whether the request is technically feasible and pose any objections that it may have to the request. Within 120 calendar days after receiving the request, US West must provide a quotation of the costs of meeting the request. The requestor has 30 calendar days thereafter to accept or reject US West’s quotation. If the requestor accepts the quotation, US West then has 90 calendar days to meet the request. So, the whole process can take up to 240 calendar days. By comparison, the process of requesting physical collocation is supposed to take no more than 145 calendar days. Q. HAS US WEST VIOLATED EVEN THE TIMETABLE UNDER THE NIUER PROCESS? A. Yes, they have. In response to recent WorldCom requests for physical collocation at the Seattle Main and Bellevue Glencourt central offices, US West stated that it will use the NIUER process and that it will take 9 months to complete the collocation preparation work (rather than the 90 days provided in the NIUER process). See letter of US West’s Jan Baird to Herbert Pozdro (dated February 11, 1998) (attached hereto as Exhibit B) (“The time frame to complete the circuit moves, remove the equipment, and recondition the area is 6 months. The collocation construction work would be an additional 3 months.”). Q. HOW SHOULD THE COMMISSION ADDRESS THIS ISSUE? A. The Commission should forbid US West from proceeding under the NIUER process for physical collocation requests and order it to honor the timetable for physical collocation in the interconnection agreement between WorldCom and US West. Q. WHAT IS A REASONABLE TIMETABLE FOR THE COMMISSION TO REVIEW US WEST’S DENIALS OF REQUESTS FOR PHYSICAL COLLOCATION? A. The Commission should review US West’s denial of requests for physical collocation within 30 days, using the measures I describe below, and rule upon the denial within an additional 30 days. The Commission’s decision on the denial would come 75 days after the initial request./ WorldCom’s proposal generally coincides with that of TCG./ While this period may seem short, WorldCom loses revenue every day that it is unable to establish physical collocation arrangements. As the record in this case confirms, WorldCom and its predecessor MFS have been awaiting physical collocation in the central offices at issue here since June of 1996. Without rapid review, US West could gain a competitive advantage by strategically denying our requests. Q. WHAT MEASURES SHOULD THE COMMISSION UNDERTAKE IN ITS REVIEW OF US WEST DENIALS OF REQUESTS FOR PHYSICAL COLLOCATION? A. First, the Commission should require US West to submit floor plans and blueprints of the central office in question. US West should include with these documents a sworn affidavit of a person with personal knowledge of the issues, attesting to the accuracy of the floor plans and blueprints./ In the Bellevue Sherwood central office, for instance, WorldCom discovered that US West’s blueprints were materially incorrect concerning space availability./ Second, the Commission should conduct a walk-through of the entire central office to determine that no space in fact exists in which the would-be collocator could physically collocate. Third, the Commission should require US West to file the report specified in the Commission’s Initial Order on US West Request for Exception from Duty to Provide Physical Collocation (dated December 23, 1997), at 16. These reports should be made available to the requesting collocators. Q. WHAT OPTIONS SHOULD A PARTY REQUESTING PHYSICAL COLLOCATION HAVE WHEN US WEST DENIES THE REQUEST? A. First and foremost, the rejected collocators’ initial application should serve as a placeholder (as of the date received by US West) for purposes of priority for the requested space while the requestor litigates the issue. Second, collocators should be able to access the floor plans and blueprints described above to verify US West’s claim that space has been exhausted. Third, collocators should be entitled to accompany the Commission on its walk-through of the entire central office, again to verify US West’s claim. Allowing personnel from the requesting party to accompany the Commission on its walk-through of the central office in question would avoid the appearance of unfairness that would result if the Commission were only accompanied by US West personnel. Q. DOES THIS CONCLUDE YOUR TESTIMONY? A. Yes.