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Initial Comments Verizon 271 Application in New Jersey

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Initial Comments Verizon 271 Application in New Jersey ATX Licensing, Inc. - Initial Comments Verizon 271 Application in New Jersey Before the Federal Communications CommisOOCKET FILE COpy ORIGII'L~L Washington, DC 20554 In the Matter ofApplication ofVerizon ) New Jersey Inc., Bell Atlantic ) Communications, Inc. (d/b/a Verizon ) CC Docket No. 01-347 Long Distance), NYNEX Long Distance ) Company (d/b/a Verizon Enterprise ) Solutions), Verizon Global Networks Inc., ) and Verizon Select Services Inc., for ) Authorization to Provide In-Region, ) InterLATA Services In New Jersey. ) COMMENTS OF ATX LICENSING, INC. Michael Pryor Christopher A. Holt Lisa N. Anderson Vice President and Assistant General Counsel ­ Mintz Levin Cohn Fems Regulatory and Corporate Affairs Glovsky and Popeo, P.e. ATX Licensing, Inc. 701 Pennsylvania Avenue, N.W. 110 East 59th Street, 26th Floor Washington, DC 20004 New York, NY 10022 (202) 434-7300 Washington, D.C. 20004 [email protected] (212) 906-8488 [email protected] [email protected] Counsellor ATXLicensing, Inc. Dated: January 14, 2002 TABLE OF CONTENTS INTRODUCTION TO ATX 2 DISCUSSION .3 I. THERE IS LITTLE COMPETITION IN THE NEW JERSEY LOCAL MARKET DUE TO VERIZON'S INTRANSIGENCE AND AN INSUFFICIENTLY PRO-COMPETITIVE REGULATORY CLIMATE .3 A. Exorbitant Non-TELRIC Rates Stymied Competitive Entry and Has Led to Inadequate Commercial Data for a Meaningful Review ofVerizon-NJ's Performance 5 B. The State Regulatory Process Has Failed to Produce a Rigorous and Thorough Review ofVerizon-NJ's Compliance with Section 271 .1 0 C. Verizon-NJ's Eleventh Hour Concessions Precluded a Thorough Review 12 II. VERIZON-NJ HAS NOT DEMONSTRATED COMPLIANCE WITH CHECKLIST ITEMS 2 AND 6 13 A. Verizon-NJ has Consistently Denied ATX Complete and Seamless Access to the Features, Functions and Capabilities ofUNE-P 15 I. Centrex Service 15 2. Remote Call Forwarding 18 3. PBX Analog Trunks 19 4. "As Is" Conversion to UNE Platform 20 B. Verizon-NJ Does Not Provide ATX With Accurate, Readable and Auditable Bills 23 I. Verizon-NJ's Bills Are Inaccurate 23 2. Verizon-NJ's Billing Practices Limit the Auditability ofWholesale Bills 26 CONCLUSION .29 EXHIBIT A .30 Before the Federal Communications Commission Washington, DC 20554 In the Malter ofApplication ofVerizon ) New Jersey Inc., Bell Atlantic ) Communications, Inc. (d/b/a Verizon ) CC Docket No. 01-347 Long Distance), NYNEX Long Distance ) Company (d/b/a Verizon Enterprise ) Solutions), Verizon Global Networks Inc., ) and Verizon Select Services Inc., for ) Authorization to Provide In-Region, ) InterLATA Services In New Jersey. ) COMMENTS OF A TX LICENSING, INC. ATX Licensing, Inc. ("ATX") hereby files these comments pursuant to the Public Notice! ofthe Federal Communications Commission ("FCC" or "Commission") requesting comments on the application ofVerizon New Jersey, Inc. ("Verizon-NJ") for authorization to provide in- region, interLATA service in the State ofNew Jersey. ATX has had significant experience in offering services in the New Jersey marketplace and hopes to expand its operations further in this state. As a result, ATX's experience directly bears on the Commission's analysis ofwhether Verizon-NJ has met the Section 271 checklist and ATX has a keen interest in the outcome ofthis proceeding. As ATX's experience indicates, Verizon-NJ has failed to truly open the New Jersey local market to competition, and its 271 Application2 is woefully premature. Verizon-NJ's 271 I Comments Requested on the Application by Verizon New Jersey Inc. For Authorization to Provide In­ Region, InlerLATA Services in the Stale ojNewJersey, CC Docket No. 01-347, DA 01-2994, Public Notice (reI. Dec. 20, 200 I) 2 Application ofVerizon New Jersey Inc., Bell Atlantic Communications, Inc. (d/b/a Verizon Long Distance), NYNEX Long Distance Company (d/b/a Verizon Enterprise Solutions), Verizon Global Networks Inc, and Verizon Select Servicesfor Authorization to Provide In-Region, InterLATA Services in New Jersey, CC Docket No. ATX Licensing, Inc. - Initial Comments Verizon 271 Application in New Jersey Application neither reflects substantive compliance with the standards ofthe Section 271 checklist nor is it the product ofa sufficiently rigorous and thorough state review process. Accordingly, ATX respectfully requests that the Commission deny Verizon-NJ's 271 Application. INTRODUCTION TO ATX Since its inception in 1985, ATX has grown to become a national telecommunications provider offering services in Delaware, Illinois, Indiana, Maryland, Michigan, New Jersey, New York, Ohio, Pennsylvania, Virginia, and Wisconsin. ATX offers a variety ofservices including local and long-distances services, Internet access, data services, wireless services, network integration services, web hosting, fax broadcast conference calling, and pre-paid calling. As of September 30, 200 I, ATX has provided service to more than 50,000 residential lines and 240,000 business lines nationwide 3 ATX has been an active competitive participant in the telecommunications marketplace for well over a decade. In the 1980s, ATX began offering long distance services in New Jersey. Subsequently, relying on the 1996 Act, and its requirements intended to eliminate barriers to local competition, ATX expanded its service offerings to include both competitive local and long distance services. ATX has utilized several entry mechanisms to offer local services in New Jersey. Initially, in order to hasten its market entry, ATX provided services on a resale basis. Subsequently, ATX desired to provide services as a facilities-based competitor. Thus, in April of 1999, ATX began installing collocation arrangements in New Jersey, and installed switching facilities in Pennsylvania to be used in part to serve New Jersey customers. ATX later 01-347. DA a1·2994, Application by Verizon to Provide In-Region InterLATA Services in New Jersey (filed Dec. 20,2001) ("Verizon·NJ 271 Application"). 3 CoreComm Communications, Inc. is the indirect parent company ofATX. ATX was formed as the result ofa merger of A TX telecommunications Services, Inc. and CoreComm Limited consummated in September 2000. 2 ATX Licensing, Inc. - Initial Comments Verizon 271 Application in New Jersey determined that it needed an intermediate strategy to facilitate the transition of its customers from resale to facilities-based services, and began attempting to convert its resale customers to the UNE-Platform ("UNE-P") instead ofimmediately serving those customers on its own facilities. Since that time, UNE-P has been a central component ofATX's business plan and the ability to access UNE-P is a key determinant ofits competitive viability in New Jersey. DISCUSSION Unfortunately, ATX's experience in accessing resale and UNE-P services from Verizon- NJ indicates that the New Jersey local market is not yet open as required by the 1996 Act. For the past year and a halt: ATX has faced substantial resistance in accessing UNE-P from Verizon- NJ in a complete and competitively neutral manner. Verizon-NJ did not begin providing UNE-P until several years after the passage ofthe 1996 Act4 Even then, Verizon-NJ limited ATX's ability to access all ofthe features ofthe switch in utilizing UNE-P arrangements. In addition, Verizon-NJ's billing systems have been systemically flawed resulting in millions ofdollars in disputed charges. I. THERE IS LITTLE COMPETITION IN THE NEW JERSEY LOCAL MARKET DUE TO VERIZON'S INTRANSIGENCE AND AN INSUFFICIENTLY PRO­ COMPETITIVE REGULATORY CLIMATE. The market statistics highlight what ATX and other competitors have experienced and shown: the state of competition in New Jersey is minimal. Competitors only account for 6.7% oflocallines in New Jersey. Residential competition is even more dismal with competitors accounting for only 1.35% oflocal lines. Only 1.4% ofNew Jersey residential customers served by CLECs are served by UNE-P, as compared to 58% and 60% ofresidential customers served 4 On October 6, 1999, the NJ BPU ordered Verizon-NJ to provide UNE-P to residential and business customers by December 1999. In re Status a/Local Exchange Competition, Docket No. TX980100100, Slip Opinion, 1999 WL 1276836 (N.J. B.P.U Oct. 6, I999)("Oct. 1999 Slip Opinion"). 3 ATX Licensing, Inc. - Initial Comments Verizon 271 Application in New Jersey by CLECs in New York and Pennsylvania respectively at the time Verizon applied for 271 approval in those states5 It is little wonder that a member ofthe BPU stated that "residential choice is not quite there yet.,,6 The state ofcompetition in New Jersey contrasts sharply with other leading competitive states in which the incumbent has received 271 approval. For example, in Pennsylvania, the level ofcompetition was 16% ofall local lines and 5.3% of residentiallines7 There are two primary reasons competition has been so slow in developing in New Jersey. First, Verizon-NJ's pattern and practice has been to delay compliance with the requirements of Sections 251 and 271 ofthe Act, and instead provide only as little as possible as late as possible. Second, the regulatory climate in New Jersey, and in particular the UNE-rates, has not been conducive to local competition. 5 Verizon-NJ estimates CLECs serve provide UNE-P over 800 lines in New Jersey, out ofa total of approximately 57,000 CLEC residential customers served by CLECs. Verizon-NJ 271 Application, Dec!. of William E. Taylor ~ 19 (filed Dec. 20, 2001). When the FCC approved Verizon's 271 application in New York, CLECs served 137,342 residential customers via UNE-P out ofapproximately 236,000 CLEC residential customers. Application by Bell Atlantic New Yorkfor Authorization Under Section 271 ofthe Communications Actfor Authority to Provide In-Region. InterLATA Service in the State ofNew York, CC Docket No. 99-295, Memorandum Opinion and Order, 15 FCC Red. 3953, 3960 ~ 14 (1999) ("New York 271 Order"). When Verizon applied for approval in Pennsylvania, CLECs served 197,000 residential customers via UNE-P out ofapproximately 329,000 CLEC residential customers. Application ofVerizon Pennsylvania In., Verizon Long Distance, Verizon Enterprise Solutions, Verizon Global Networks Inc., and Verizon Select Services Inc.
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