Agenda Date:  January 27, 1999
Item Number:

Docket:  UT-990022
Company Name: U S WEST Communications, Inc.

Staff:   David Dittemore, Engineer
   Glenn Blackmon, Assistant Director - Telecommunications 
   Jeff Payne, Regulatory Consultant

Recommendation:

Direct the Secretary to sign an order issuing a complaint and order suspending 
the Request for Competitive Classification for High Capacity Circuits, within 
the Greater Seattle, Vancouver and Spokane areas, filed by U S WEST 
Communications in Docket UT-990022, setting the matter for hearing, and 
directing the Company to notify all affected customers.

Discussion:

On January 8, 1999, U S WEST Communications, Inc., (U S WEST) filed a Request 
for Competitive Classification for High Capacity Circuits in the Greater 
Seattle, Vancouver, and Spokane areas.  U S WEST contends that these services, 
which include T-1 and DS-3 circuits used by businesses, Internet service 
providers, and long distance companies, are offered by other, competing 
providers and that U S WEST no longer has a captive customer base.

RCW 80.36.330 authorizes the Commission to “classify a telecommunications 
service provided by a telecommunications company as a competitive 
telecommunications service” if it finds that the service is “subject to 
effective competition.”  The statute defines “effective competition” to mean 
that “customers of the service have reasonably available alternatives and that 
the service is not provided to a significant captive customer base.”

In determining whether a particular service is a competitive service, the 
Commission should consider, among other factors, the following:

 (1) the number and size of alternative providers of services;

 (2) the extent to which services are available from alternative providers in 
the relevant market;

 (3) the ability of alternative providers to make functionally equivalent or 
substitute services readily available at competitive rates, terms, and 
conditions; and

 (4) other indicators of market power, which may include market share, growth 
in market share, ease of entry, and the affiliation of providers of services.


Docket UT-990022
January 27, 1999
Page 1

U S WEST has provided a study that provides some background information about 
the current market.  However, more complete information is needed to draw 
conclusions about the competitive state of the market, since retail, wholesale, 
and transport services are intertwined in the market. It may be that, within 
the broad category of "high capacity services," there are some services that 
are subject to effective competition but other services that have captive 
customers.

TRACER, an association of large business customers who use the services at 
issue in this filing, has asked that the Commission suspend the filing and set 
it for hearing.

The Commission must act on the request by July 8, 1999.  This will require that 
the Commission establish an expedited schedule for testimony, hearings, and 
briefs.

WAC 480-120-022 states that the Commission may require a company to notify its 
customers that it has made a request for competitive classification.  Staff 
believes that such notice is appropriate in this case.  Staff recommends that 
the company be ordered to provide notice to all customers who currently use the 
services that would be affected by this filing and that the company be directed 
to work with Staff on the form and content of this notice.

Conclusion:

Staff recommends that the Commission issue a complaint and order suspending the 
Company’s request for Competitive Classification in Docket UT-990022.