Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Petition for Declaratory Ruling Whether ) WC Docket No. 08-56 Voice over Internet Protocol Services Are ) Entitled to the Interconnection Rights of ) Telecommunications Carriers ) REPLY COMMENTS OF THE NEW JERSEY DIVISION OF RATE COUNSEL RONALD K. CHEN PUBLIC ADVOCATE STEFANIE A. BRAND DIRECTOR Division of Rate Counsel 31 Clinton Street, 11 th Floor P.O. Box 46005 Newark, NJ 07101 (973) 648-2690 - Phone (973) 624-1047 – Fax www.rpa.state.nj.us [email protected] On the Comments: Christopher J. White, Esq. Deputy Public Advocate Dated: June 9, 2008 TABLE OF CONTENTS PAGE I. INTRODUCTION AND SUMMARY………………………………………………….. 1 A. INTEREST OF THE RATE COUNSEL IN THE INSTANT PROCEEDING. .....................................................................................................2 B. SUMMARY ............................................................................................................2 II. VTEL’s PETITION……………………………………………………………………... 3 VTel’s Representation of Comcast Phone of Vermont, LLC is Erroneous. .....3 State Commissions retain the authority to authorize carriers to provide local exchange service. ....................................................................................................4 As a certificated telecommunications provider and a wholesale telecommunications provider, Comcast Phone of Vermont, LLC is entitled to interconnection rights. .........................................................................5 VTel’s Petition raises the specter of regulatory arbitrage. ................................7 The Commission should not allow carriers to take advantage of regulatory uncertainty to thwart competition. .......................................................................8 III. ONGOING COMMISSION PROCEEDINGS………………………………………. 11 Continued inaction by the Commission is detrimental to the development of competition and regulatory regimes. .............................................................11 Regulatory clarity is critical to keep pace with technological innovation. .....14 IV. CONCLUSION…………………………………………………………………………17 i Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) Petition for Declaratory Ruling Whether ) WC Docket No. 08-56 Voice over Internet Protocol Services Are ) Entitled to the Interconnection Rights of ) Telecommunications Carriers ) REPLY COMMENTS OF THE NEW JERSEY DIVISION OF RATE COUNSEL I. INTRODUCTION AND SUMMARY The New Jersey Division of Rate Counsel (“Rate Counsel”), with this filing, replies to comments submitted in response to the Public Notice 1 issued by the Federal Communications Commission (“FCC” or “Commission”) soliciting comments regarding Vermont Telephone Company’s (“VTel”) Petition for Declaratory Ruling seeking clarification regarding the interconnection rights of Voice over Internet Protocol (“VoIP”) providers. 2 1 / Federal Communications Commission, Public Notice, “Pleading Cycle Established for Comments on Vermont Telephone Company’s Petition for Declaratory Ruling Regarding Interconnection Rights,” WC Docket No. 08-56, DA 08-916, April 18, 2008. 2 / Petition for Declaratory Ruling Whether Voice over Internet Protocol Services Are Entitled to the Interconnection Rights of Telecommunications Carriers, Petition for Declaratory Ruling filed by Vermont Telephone Company, April 11, 2008 (“VTel Petition”). 1 A. INTEREST OF THE RATE COUNSEL IN THE INSTANT PROCEEDING. Rate Counsel is an independent New Jersey State agency that represents and protects the interests of all utility consumers, including residential, business, commercial, and industrial entities. Rate Counsel participates actively in relevant Federal and state administrative and judicial proceedings. The above-captioned proceeding is germane to Rate Counsel’s continued participation and interest in implementation of the Telecommunications Act of 1996 (“1996 Act” or “Act”). 3 The New Jersey Legislature has declared that it is the policy of the State to provide diversity in the supply of telecommunications services, and it has found that competition will “promote efficiency, reduce regulatory delay, and foster productivity and innovation” and “produce a wider selection of services at competitive market-based prices.” Ultimately, consumers bear the cost of the public switched telephone network and the framework within which carriers interconnect is critical to extend lower prices and competitive choices to those consumers. B. SUMMARY VTel seeks “policy clarification” on three questions: (1) whether only “telecommunications carriers” are entitled to interconnection rights in accordance with the terms of Sections 251 and 252 of the1996 Act; (2) whether VoIP providers are entitled to the interconnection rights of Sections 251 and 252 “when they assert they are not “telecommunications carriers”; and (3) whether Comcast Phone of Vermont, LLC “as a VoIP provider, is a telecommunications carrier and, therefore, is entitled to 3 / Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (“1996 Act”). The 1996 Act amended the Communications Act of 1934. Hereinafter, the Communications Act of 1934, as amended by the 1996 Act, will be referred to as “the 1996 Act,” or “the Act,” and all citations to the 1996 Act will be to the 1996 Act as it is codified in the United States Code. 2 interconnection pursuant” to Sections 251 and 252. 4 Comcast Corporation (“Comcast”), in response, asks the Commission to “summarily deny and dismiss” VTel’s petition. 5 Rate Counsel agrees with VTel that “there seems to be some confusion and uncertainty in the industry as to the application of the statutory provisions discussed herein to VoIP providers.” 6 After reviewing the comments filed in this proceeding it is apparent that VTel’s specific request is likely to be dismissed as the Petition makes an erroneous claim regarding the identity of the entity seeking interconnection. However, the uncertainty regarding the applicability of the Commission’s policies, rules, and various regulatory regimes to VoIP providers continues to be problematic and to invite self-help measures by incumbent local exchange carriers (“ILECs”). The Commission should, in no uncertain terms, rebuff ILECs’ efforts to make policy determinations on their own and, in the process, thwart competition. II. VTEL’s PETITION VTel’s Representation of Comcast Phone of Vermont, LLC is Erroneous. As many have noted, VTel appears to be mistaken in its analysis of Comcast’s various entities.7 For instance, VTel states that the service for which Comcast is seeking interconnection is a VoIP service (which VTel claims is “Digital Voice”). 8 Yet, the service itself should not be an issue here. Comcast clarifies that its wholesale telecommunications provider company (“Comcast Phone of Vermont, LLC”) is seeking 4 / VTel Petition, at 1. 5 / Comments of Comcast Corporation (“Comcast”), at 1. 6 / VTel Petition, at 2. 7 / See, e.g. , Bright House, at 6, suggesting that VTel appears to be trying to “relitigate” the Time Warner Interconnection Order; Vermont Department of Public Service, at 4-5; Comcast, at 2. 8 / VTel Petition, at 2. 3 interconnection rights, which, in turn, provides telecommunications services, transport, interconnection to the PSTN, emergency services access, numbering resources, etc . to Comcast IP Phone II, LLC (“Comcast Digital Voice”). Comcast Digital Voice offers the retail VoIP service to consumers and is a wholly owned affiliate of Comcast. 9 Comcast Phone of Vermont, LLC is the entity that holds the Certificate of Public Good to offer telecommunications services in Vermont. 10 State Commissions retain the authority to authorize carriers to provide local exchange service. VTEL minimizes the role of states in issuing certificates and authorization of service, and asserts that the designation of a carrier as a “telecommunications carrier” is under the FCC’s domain: “[t]he Act appears to allocate final authority for this important national policy matter to the FCC.” 11 However, Rate Counsel agrees with AT&T, Inc. (“AT&T”) that the assessment of whether Comcast is a telecommunications carrier first rests with the Vermont Public Service Board. 12 Feature Group IP notes that the Commission “has typically treated the issuance and presentation of a state certificate as prima facie evidence” that the carrier is a telecommunications carrier. 13 Rate Counsel agrees with the Vermont Department of Public Service that VTel’s petition appears to ask the Commission to “overreach into a state commission’s authority to implement state and Federal law . [t]he Commission cannot question a state commission’s determination 9 / Comcast, at 2. 10 / Vermont Department of Public Service, at 5. 11 / VTel Petition, at 3. 12 / AT&T, at 2, citing National Ass’n of Regulatory Util. Comm’rs v. FCC, 173 U.S. App. D.C. 413, 525 F. 2d 630 (D.C. Cir. 1976) cert denied, 425 U.S. 992, 96 S. Ct. 2203, 48 L. Ed. 2d 816 (“NARUC I”). 13 / Feature Group IP, at 8. 4 that an entity is both qualified to offer local exchange service and has the right to request interconnection from other telecommunications carriers.” 14 As a certificated telecommunications provider and a wholesale telecommunications provider, Comcast Phone of Vermont, LLC is entitled to interconnection rights. Many commenters in this proceeding assert that Sections 251 and 252 are clear that only telecommunications carriers have been granted interconnection rights. 15 Rate Counsel