Covad Communications Company's Brief on Exceptions on Rehearing

STATE OF ILLINOIS ILLINOIS COMMERCE COMMISSION Joint Submission of the Amended Plan ) of Record for Operations Support ) Docket No. 00-0592 Systems (“OSS”) ) COVAD COMMUNICATIONS COMPANY’S BRIEF ON EXCEPTIONS ON REHEARING Covad Communications Company (“Covad”) hereby files these exceptions to certain conclusions reached on Issue 19(b) and Issues 29/31 in the Administrative Law Judges’ Proposed Order dated July 3, 2001 (“HEPO”). The Administrative Law Judges reached the appropriate conclusions regarding the provision of loop makeup information on multiple loops. Nonetheless, implementation of the conclusions identified below regarding the impair analysis, identification of loops by CLECs during the ordering process, and direct access would be contrary to state and federal law, sound public policy, and the rapid deployment of advanced services in Illinois. Covad takes exception to seven issues in the HEPO. First, the HEPO should be revised to remove any requirement that a CLEC must satisfy the “necessary and impair” standard in order to obtain access to pre-ordering and ordering OSS functions. As discussed below, such a requirement violates both federal and state law. Second, even if the impair analysis were required (which it is not), the HEPO misapplies the impair analysis. Third, the HEPO errs in finding that the Commission’s January 2001 Order has been stayed. Fourth, the HEPO errs in discounting evidence regarding the OSS access provided by other ILECS. Fifth, the HEPO improperly credits Ameritech’s unfounded claim that it is a massive undertaking for Ameritech to allow CLECs to identify a loop for ordering. In 1 addition, the HEPO artificially restricts Covad’s and other CLEC’s ability to provide varied DSL service to Illinois consumers because Ameritech, rather than CLECs, determines what loops will be optimal for the CLEC’s DSL service. Sixth, the HEPO must be clarified regarding Ameritech’s obligation to provide loop makeup information on multiple loops. As discussed below, Ameritech today provides manual and electronic loop makeup; the HEPO should be revised to require Ameritech to provide similarly manual and electronic loop makeup on multiple loops. Seventh, the HEPO must be revised to eliminate the erroneous conclusion that federal law does not require direct access to Ameritech’s OSS systems. Covad has provided it proposed replacement language as Attachment A to its Brief on Exceptions. I. APPLICATION OF THE IMPAIR ANALYSIS TO PRE-ORDERING AND ORDERING OSS FUNCTIONS VIOLATES FEDERAL AND STATE LAW. The HEPO concludes that it must apply the impair standard “to determine whether Ameritech’s OSS offerings for the proposals at issue must be expanded beyond those required by the FCC.” (HEPO at 44). The HEPO’s conclusion is erroneous for two reasons. First, the OSS functions at issue in this case do not “expand” beyond those required by federal law. Second, the OSS functions at issue in this case must be made available to CLECs under state law. Accordingly, the HEPO must be revised to remove any requirement that CLECs can only access such pre-ordering and ordering OSS functions upon satisfactory completion of the impair analysis. A. The HEPO Effectively Removes An Unbundled Network Element from the Federal List of Unbundled Network Elements. The HEPO improperly concludes that it must apply the impair standard in this proceeding before Covad and other CLECs can gain access to pre-ordering and ordering 2 OSS functions. This pronouncement is tantamount to removing portions of OSS from the federal list of unbundled network elements. Federal law requires that ILECs provide unbundled access to their OSS functions, consisting of pre-ordering, ordering, provisioning, maintenance and repair, and billing functions supported by the ILEC’s databases and information. 47 C.F.R. § 51.319(g). Covad seeks access to pre-ordering and ordering functions supported by Ameritech’s OSS. Thus, this case involves access to Ameritech’s OSS – an existing unbundled network element that Ameritech is already required to provide. State commissions cannot remove network elements from the ILEC’s unbundling obligations under the 1996 Act. UNE Remand Order ¶ 157. Yet, the HEPO does just that – it removes some unspecified portion of Ameritech’s OSS functions from the list of unbundled network elements available to CLECs. Moreover, the HEPO does not make clear where the line will be drawn. What pre-ordering OSS functions exist within the federally-defined OSS unbundled network element? What pre-ordering functions are “new elements” that require the Commission to apply the impair analysis? What ordering functions fall within the OSS unbundled network element? In sum, when is Ameritech’s OSS a UNE and when is a new network element? The HEPO is silent on all of these issue. Moreover, there is nothing in the Telecommunications Act or in its implementing regulations that supports the conclusion that specific functions of OSS are not already unbundled network elements. During this rehearing, Ameritech has been equally unable to explain when the Commission must apply the impair analysis. Ameritech’s witnesses could only articulate that the impair analysis must be applied if the functionality involves a substantial change. (Tr. at 1720, 3 1745). As Ameritech acknowledged in its reply brief, “the OSS UNE, of course, is expansive, and it covers many different areas of an ILEC’s operations, from pre-ordering through maintenance and repair and billing.” (Ameritech Reply Br. at 3). It is apparently not expansive enough, however, to cover the OSS functions at issue in this case. Thus, CLECs can only be left wondering which pre-ordering and ordering functions are covered in the federal OSS UNE, and which ones are somehow now excluded from this otherwise “expansive” federal UNE. It appears that Ameritech seeks a rule such as the following: If Ameritech is willing to make an OSS modification requested by CLECs, then that modification is part of the “expansive” federal UNE; if Ameritech is unwilling to make an OSS modification requested by CLECs, then that modification may only be achieved through applying the impair analysis. Obviously, such a rule as suggested by the HEPO and supported by Ameritech renders the CLEC community in complete uncertainty about its rights and Ameritech’s obligations, even when the FCC has already spoken clearly on the CLECs right to OSS as an unbundled network element. As a result, the HEPO opens the door for increased litigation before the Commission. Such a result is contrary to public policy. As the FCC stated, “Litigation over the incumbents’ unbundling obligations requires the parties . and state commissions . to expend vast amounts of time, and resources, ultimately impairing the ability of competitive LECs to execute their business plans.” UNE Remand Order ¶ 115. Yet, such a result is inevitable here. A CLEC, relying on the federal law that requires access broadly to pre-ordering and ordering “functions supported by an incumbent LEC’s databases and information,” cannot know whether Ameritech will find that those 4 functions fall within the OSS UNE. Ameritech may determine, as here, that certain pre- ordering and ordering functions are not covered in the UNE definition. CLECs will then be faced with the threat of “necessary and impair” litigation every time they request additional or modified OSS functionality. Such a result directly contradicts federal law. The FCC has explicitly stated that a list of unbundled network elements provides CLECs with the certainty necessary to compete effectively against ILECs. UNE Remand Order ¶¶ 114-115. The FCC noted: “we find that unbundling requirements we adopt should typically provide the uniformity and predictability new entrants and fledgling competitors need to develop and implement national and regional business plans.” UNE Remand Order ¶ 114. The HEPO injects uncertainty into the process because CLECs can no longer be assured that all pre-ordering and ordering OSS functions will be made available to them. The HEPO appears to ground its decision to apply the impair standard here on the FCC’s Kansas/Oklahoma 271 Order. In particular, the HEPO finds that the FCC “determined [in its Kansas/Oklahoma 271 Order] that SBC’s optimization process, which returned information on one loop in the pre-ordering sessions, did not violate the UNE Remand Order.” (HEPO at 42). Yet, as Staff, Covad, and AT&T stated, the FCC expressly declined in the Kansas/Oklahoma 271 Order to interpret the UNE Remand Order requirements regarding loop makeup information. Indeed, the FCC determined that it would be inappropriate to do so in a 271 proceeding. Thus, the Kansas/Oklahoma 271 Order did not hold that additional pre-ordering functionality – seeking qualification information on additional loops available at a customer’s address – was not required by the UNE Remand Order, as Ameritech argued and the HEPO concludes. Instead, the 5 FCC found that it was not “self-evident” that this functionality was required by its order and thus encouraged public comment. In doing so, the FCC made absolutely no mention whatsoever of the application of the necessary and impair test, nor did it presuppose that this functionality was not required by the UNE Remand Order or the 1996 Act. Indeed, the HEPO interprets the Kansas/Oklahoma 271 Order as holding that loop makeup information on multiple loops cannot be an existing ILEC obligation because it approved Southwestern Bell Telephone’s (SWBT’s) 271 application without requiring that such functionality be made available to all CLECs. Yet, the FCC similarly approved SWBT’s Texas 271 application despite the fact that SWBT failed to prvoide line splitting. As with loop makeup information in Kansas, the FCC found the 271 context an inappropriate one for resolution of such an issue. Despite the 271 approval, the FCC subsequently found that SWBT had a “pre-existing obligation” to provide line splitting pursuant to the Act and its rules.

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