[Federal Register: October 2, 2003 (Volume 68, Number 191)]
[Rules and Regulations]
[Page 56781-56783]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02oc03-4]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 52
[CC Docket 99-200; FCC 03-140]
Numbering Resource Optimization
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Commission denied the petition for
forbearance filed by the Cellular Telecommunications and Internet
Association (CTIA) and found that forbearance was not warranted.
FOR FURTHER INFORMATION CONTACT: Cara Voth, Attorney, Wireline
Competition Bureau, Telecommunications Access Policy Division, (202)
418-7400, TTY (202) 418-0484.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Memorandum Opinion and Order in CC Docket No. 99-200, FCC 03-140
released on June 26, 2003. The full text of this document is available
for public inspection during regular business hours in the FCC
Reference Center, Room CY-A257, 445 Twelfth Street SW., Washington, DC
20554.
I. Introduction
In this Order, the Commission denied the petition for forbearance
filed by the Cellular Telecommunications and Internet Association
(CTIA) on June 28, 2002. CTIA sought forbearance from further scheduled
increases to the numbering resources utilization threshold. CTIA argued
that forbearance should be granted because the projected life of the
North American Numbering Plan (NANP) has been extended, and increases
to the current utilization threshold will raise the cost of providing
service and increase the risk that numbering resources will not be
available to carriers when needed. All commenters opposed CTIA's
forbearance request. The Commission denied CTIA's Petition and found
that forbearance was not warranted.
II. Discussion
1. We find that CTIA's forbearance petition does not satisfy the
forbearance criteria set forth in section 10(a) of the Act.
Specifically, we find that the numbering resources utilization
threshold, and the scheduled increases up to the 75% cap, are necessary
to ensure that carriers will obtain numbering resources in a just and
reasonable manner, i.e., only when and where they are needed to provide
services. We further find that requiring carriers to manage their
numbering inventories at increasing thresholds is a preventative
measure that is necessary to protect consumers from premature area code
changes and exhaust of the NANP. We also find that it is consistent
with the public interest to increase the threshold because it will
continue to require carriers to use numbering resources more
efficiently, which will benefit carriers and consumers.
Charges, Practices, Classifications and Regulations
2. The scheduled increases to the threshold ensure that carriers
will obtain additional numbering resources only when they are needed
and utilize their numbering inventories on an increasingly efficient
basis. Such efficiency is necessary to avoid the waste of finite
numbering resources that are essential to providing telecommunications
service. Conversely, freezing the threshold at its current level could
accelerate NANP exhaust and burden customers with premature area code
changes, contrary to the public interest.
3. As the Commission first concluded in the Numbering Resource
Optimization First Report and Order, 65 FR 43251, July 13, 2000, the
utilization threshold requirement, coupled with the MTE requirement,
deters carriers from stockpiling excessive inventories and helps ensure
that carriers optimize the use of existing numbering resources. Due in
part to these measures, the projected life of the NANP has been
significantly extended. Even CTIA lauds the success of these measures.
Furthermore, the Pennsylvania Commission submits that forbearance
[[Page 56782]]
from increasing the utilization threshold could result in the
unnecessary stranding of over 1.3 million individual telephone numbers
in Pennsylvania's NPAs. Thus, we find that the Commission's numbering
resources utilization threshold and its scheduled increases are
necessary to ensure that carrier practices with regard to numbering
resources are not unjust or unreasonable.
4. We also disagree with CTIA's suggestion that scheduled increases
are rendered unnecessary by the Commission's already existing authority
under sections 201 and 202 of the Act to address unjust or unreasonable
carrier practices. While we agree that we have authority pursuant to
these sections to address matters regarding carriers' access to
numbering resources, the existence of such authority does not, by
itself, negate the necessity of retaining scheduled increases to the
utilization threshold. Targeted rules, such as the utilization
threshold and its scheduled increases, provide an additional measure to
ensure that carriers optimize the use of existing numbering resources
on an ongoing basis to prevent premature NANP exhaust. As mentioned
above, telephone numbers are a finite resource. Therefore, we must
maintain proactive and predictable measures that preserve the NANP in
addition to depending on our authority to initiate case-by-case
enforcement investigations. We find that because of the concerns
described above, we would not be justified in forbearing now, even if
we were to ``revisit the issue at a later date if necessary to preserve
the NANP'' as CTIA suggests.
Consumer Protection
5. We conclude that retaining the scheduled increases to the
numbering resource utilization threshold is necessary for the
protection of consumers, and we disagree with CTIA that forbearance in
this instance would benefit consumers. One of the overarching goals of
the Commission's numbering optimization orders is to protect consumers
from the expense and inconvenience resulting from frequent area code
changes, and to prevent what would be a costly premature expansion of
the NANP. We agree with the Pennsylvania, California and Michigan
commissions that freezing the utilization threshold could burden
customers with premature area code changes as a result of earlier NANP
exhaust. We find that by increasing the threshold, we are minimizing
the opportunity for carriers to stockpile unused numbers when other
carriers are in need of such resources to serve their customers. Higher
utilization levels will help to maximize the use of all available
numbers which, in turn, will delay the exhaust of individual area
codes.
6. Furthermore, we agree with the states that maintain that
evolving technologies, as well as expanding services, could cause the
demand for numbers to spike past the previous levels. For example, as
voice over Internet protocol (VoIP) providers continue to penetrate the
telecommunications market, the demand for numbers may increase. Such
demand could burden existing numbering resources. Therefore, we find
that requiring carriers to manage their numbering inventories at higher
thresholds is a preventative measure that is necessary to ensure that
consumers will not have to bear the burden of premature area code
changes and NANP expansion.
7. We disagree with CTIA's claim that we should forbear from
further increases because they will lead to increased carrier and
consumer costs. CTIA has not presented any data or detailed cost-
benefit analysis to support this assertion. In fact, CTIA readily
concedes that it is ``impossible to quantify the administrative costs
carriers will incur from managing numbers at higher utilization
levels.'' Moreover, the New York and California commissions have
maintained utilization thresholds at 75% without any indication that
there have been adverse effects on consumers. We are not convinced that
increases to the utilization threshold would result in significantly
more costs because the scheduled increases to the threshold are limited
to 5% annually and are capped at 75%. We note that previously CTIA
proposed and supported 5% annual increases to the utilization
threshold. Moreover, in a recent ex parte filing, CTIA appears to
depart from its position that the Commission should freeze the
threshold at 65% by indicating that a 70% threshold would be an
acceptable utilization level. Thus, it appears that CTIA now claims
only that the difference between a 70% and 75% utilization threshold
would be unnecessarily burdensome, in which case carriers would be
required to use only 50 more numbers per thousands-block. We reject
CTIA's claim that scheduled increases to the utilization threshold will
raise costs while providing little benefit.
8. We also disagree with CTIA's claim that forbearance is warranted
as a consumer benefit because it will allow carriers more time to
``age'' telephone numbers. We find that the numbering utilization
threshold has little or no affect on the aging process. Because
carriers have the flexibility to age numbers up to 90 days regardless
of the utilization threshold, carriers will be able to replenish their
inventories of unused numbers with numbers that have been aged on an
ongoing basis. Carriers, therefore, must make a business decision as to
how long to age their numbering resources. In the Numbering Resource
Optimization First Report and Order, the Commission stated that it
believes that carriers can reuse numbers in significantly less than 90
days. Certain states have maintained utilization thresholds higher than
the current threshold without any indication that there have been
adverse effects on the aging process or on consumers. Therefore, we
find that carriers' ability to age numbers within the Commission's
prescribed limits will not be negatively affected by further increases
in the numbering resources utilization threshold.
9. Moreover, we believe that CTIA's claim regarding the aging
process is merely another attempt at arguing that increases to the
utilization threshold are burdensome because they require carriers to
use numbers more efficiently. Requiring carriers to use numbering
resources more efficiently, however, is the goal that increases to the
utilization threshold were designed to achieve. We find that freezing
the utilization threshold at its current level would have a detrimental
effect on numbering resource optimization and, in turn, on consumers
because it would provide opportunity for carriers to stockpile unused
numbers that could be assigned to other requesting customers.
Public Interest
10. We conclude that it is in the public interest to retain
scheduled increases to the utilization threshold because it will
continue to result in more efficient use of numbering resources,
further extend the life of the NANP, and facilitate impartial numbering
administration by encouraging all carriers to use numbers in their
existing inventory before requesting new ones. In the Numbering
Resource Optimization Second Report and Order, the Commission adopted
60% only as an ``initial'' utilization threshold. The Commission chose
this initial threshold because it was demonstrably achievable and it
would give carriers the opportunity to transition to the 75% ceiling
without compromising their ability to obtain numbering resources to
serve customers. The Commission found, as we do here, that a
utilization threshold ceiling of 75% was appropriate because it
[[Page 56783]]
balanced the Commission's goals of encouraging carriers to use numbers
currently in their inventories before applying for additional resources
with carriers' need to retain flexibility in managing their
inventories. The Commission was concerned that many carriers were not
doing enough to groom their numbering inventories to minimize waste of
the NANP's finite numbering resources. Today, many areas continue to
face a heightened demand for numbering resources and, therefore, a
utilization threshold of 75% remains in the public interest to ensure
that carriers continue to use their numbering resources more
efficiently.
11. We disagree with CTIA's claim that we should forbear because
doing so will bring about reduced regulatory costs that will promote
competitive market conditions. As stated above, any reductions in
regulatory costs that would result from forbearance are speculative,
and would relate to relatively few numbers in a carrier's inventory.
Thus any cost savings would only be minimal, at best. Even if we
granted forbearance from further increases, carriers would still have
to continue to bear the costs associated with complying with the
current utilization level. We have not been shown, nor are we
convinced, that the marginal costs related to compliance with increases
to the utilization threshold have any effect on competitive market
conditions. In fact, we find that forbearance would result in lost
efficiencies in numbering resource optimization. When such costly
inefficiencies are balanced against the minimal regulatory costs that
may be saved by carriers as a result of freezing the current
utilization threshold, it is clear that forbearance is not consistent
with the public interest.
12. Finally, we find unsupportable CTIA's alternative claim that
increases to the utilization threshold will result in certain carriers
not having enough numbers available to them to meet customer demand.
Once the utilization threshold reaches 75%, carriers will have 25% of
their resources available to assign to new customers. Moreover,
sufficient mechanisms, such as the safety valve, are in place to ensure
that carriers with a verifiable need for additional numbers can get
them even if they do not meet the utilization threshold requirements.
For example, if, as CTIA suggests is the case for some carriers, a
carrier has to use a large amount of numbers for E911 routing purposes,
and as a result does not have a sufficient amount of telephone numbers
to meet customer demand, that carrier can apply for relief via the
safety valve. In addition, the state commissions note that no carriers
have complained that the utilization thresholds are technically or
otherwise infeasible, and that no customers have complained about being
unable to obtain service because a carrier did not have enough numbers.
Therefore, we reject CTIA's contention that forbearance is in the
public interest, or will promote or enhance competitive market
conditions among providers of telecommunications services.
III. Ordering Clause
13. Pursuant to sections 10 and 251(e) of the Communications Act of
1934, as amended, 47 U.S.C. 160 and 251(e), that the Cellular
Telecommunications and Internet Association's Petition for Forbearance
From Further Increases in the Numbering Utilization Threshold, filed on
June 28, 2002, is denied.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 03-24941 Filed 10-1-03; 8:45 am]
BILLING CODE 6712-01-P