In the Matter of Application by SBC Communications Inc., Southwestern Bell 
Telephone Company, and Southwestern Bell Communications Services, Inc. 
d/b/a Southwestern Bell Long Distance 
Pursuant to Section 271 of the Telecommunications Act of 1996
 To Provide In-Region, InterLATA Services in Texas, CC Docket No. 00-65

Concurring Statement of Commissioner Harold W. Furchtgott-Roth

I concur in the decision to grant this application by Southwestern Bell Telephone 
Company (SWBT) to provide in-region, inter-LATA services in the State of Texas.  I 
write separately, however, in order to apply my understanding of the statute. 

Application of Sections 251, 252, and 271

As I explained in the decision on Bell Atlantic’s application to offer long distance 
service in New York, the relationship between the regulatory approval process under 
section 271 and the procedures regarding private interconnection agreements established 
by sections 251 and 252 is a critical one.   Unfortunately, the Commission has not paid 
close attention to this relationship, and its failure to do so has caused the section 271 
review process to morph into something quite different from the original statutory plan.  
The process has turned into a general federal regulatory scheme, instead of tracking the 
contract-based, State-centric model of sections 251, 252, and 271.  See generally 
Concurring Statement of Commissioner Harold W. Furchtgott-Roth, In the Matter of 
Application by Bell Atlantic New York for Authorization Under Section 271 of the 
Communications Act to Provide In-Region, InterLATA Service in the State of New York, 
CC Docket No. 99-295 (rel. Dec. 22, 1999) (“New York Statement”). 

I will briefly reiterate those points that pertain to my analysis here.  First, the text 
of section 271 makes clear that the relevant universe of BOC conduct to be tested in a 
“Track A” application is not its commercial performance generally, as the Order 
supposes, but its fulfillment of specific interconnection agreements:

With respect to a BOC that "is providing access and interconnection pursuant to 
one or more agreements described in paragraph (1)(A)," as here, it is "such access 
and interconnection [that must] meet[] the requirements of" the competitive
checklist. Id. section 271(c)(2)(A) (emphasis added). Similarly, the statute defines 
the Commission’s administrative task under Track A as determining whether the 
petitioning BOC "with respect to access and interconnection provided pursuant to
subsection c(1)(A) has fully implemented the checklist." Id. section 
271(d)(3)(A)(i).

New York Statement at para. 6.

Second, in analyzing the RBOC’s fulfillment of the checklist under its approved 
interconnection agreements, one should consider the existence of complaints to enforce 
those agreements filed by interconnecting parties with the State Commission.  If CLECs 
are receiving seriously inadequate service under those agreements, one would expect to 
see them invoke the rights and remedies guaranteed to them by sections 251 and 252, 
including the right to arbitration and federal court review.   Accordingly, it has seemed to 
me that

the most probative evidence of compliance with the checklist – perhaps even 
prima facie proof -- is the absence of disputes arising under section 252 contracts. 
Conversely, the best evidence of noncompliance is the presence of such disputes. 
Record documentation of these disputes, such as complaints filed with State 
Commissions pursuant to section 252, would only strengthen that showing.

Id. at para. 23..

In sum, the best case for noncompliance with section 271 under Track A is to be 
made by parties:  (1) with approved interconnection agreements described in section 
271(c)(1)(A); (2) who legitimately allege that the RBOC is not providing them service 
pursuant to the actual terms and conditions of those agreements; and (3) who have 
pursued those alleged violations with State Commissions pursuant to section 252.

On this record, we have evidence that approaches, but does not meet, this 
standard.  Covad Communications, which opposes the instant application, receives 
interconnection and access from SWBT pursuant to a final, “Track A” interconnection 
agreement that was arbitrated and approved under section 252.  And that agreement 
appears to provide for the non-discriminatory provisioning of x-DSL capable loops to 
Covad.  See Ex Parte Submission of Covad Communications (June 27, 2000) (attaching 
interconnection agreement on DSL).  So far, so good.
 
That interconnection agreement, however, was not finalized and operative until 
February of this year.  Although Covad points to findings by Texas arbitrators related to 
discriminatory provisioning of loops by SWBT, those findings were not made in the 
context of a controversy arising under a section 252 contract – that is, in a dispute over 
the adequacy of SWBT’s service under the terms of an existing interconnection 
agreement.  Rather, they were made in the context of a petition for arbitration to establish 
an interconnection agreement and terms thereunder with SWBT.   Covad never alleged a 
breach of performance under a Track A agreement, at the State Commission or anywhere 
else, and the arbitrators’ findings do not go to SWBT’s actual performance of an 
agreement but to the proper drafting of a future agreement.  Such findings, then, are not 
probative of a failure to provide access and interconnection pursuant to a Track A 
agreement. 

AT&T, which also takes service from SWBT under an approved interconnection 
agreement, also opposes the grant of this application.  It argues in this proceeding that 
SWBT is, in various ways, violating the terms and conditions of its interconnection 
agreement.  See Ex Parte Submission of AT&T (June 23, 2000).  For example, AT&T 
says that SWBT is discriminating against it in the provision of unbundled, DSL-capable 
loops obtained as part of the UNE-platform, and that this conduct violates the non-
discrimination and other provisions of their agreement and section 251.  See id. at page 2 
(citing section 55.1 of agreement, providing that “[a]t the request of AT&T and pursuant 
to the requirements of the Act, SWBT will offer . . . Network Elements to AT&T on an 
unbundled basis on rates, terms, and conditions set forth in this Agreement that are just, 
reasonable, and non-discriminatory”).  Thus, AT&T well demonstrated that the conduct 
that it alleges as a problem under section 271 is conduct to which its interconnection 
agreement directly speaks.  Again, so far so good.

What AT&T has not done, however, is adduce evidence that it has sought 
enforcement of its contractual right to nondiscrimination with the State Commission.  
Like Covad, it has participated in hearings regarding the content of new, not-yet-entered-
into interconnection agreements.  See AT&T Ex Parte Submission (June 27, 2000).  But 
the record does not reflect that AT&T has ever asserted that SWBT’s provision of access 
and interconnection under an operative agreement was in breach.  As with respect to 
Covad, there is no showing here that AT&T has ever attempted to enforce its contractual 
rights.

As noted above, CLEC action to enforce an alleged breach of an interconnection 
agreement is evidence of significantly inadequate provisioning of access and 
interconnection under section 252 contracts, which, as I read section 271, is the relevant 
universe of access and interconnection  Accordingly, while both Covad and AT&T make 
legitimate points here, I still “view with skepticism assertions of inadequate BOC 
performance lodged for the first time in the section 271 approval process.”  Concurring 
Statement, New York Order.  That is what we have with respect to both Covad and 
AT&T, and I thus find no record evidence of failure by SWBT to perform as required 
under the terms of section 252 contracts.

SBC/Ameritech Merger Conditions

As I stated at the time of the Commission’s approval of SBC and Ameritech’s 
application to transfer licenses and authorizations under sections 309 and 214 of the 
Communications Act, I believe that some of the conditions applied to the license transfer 
conflict with specific sections of the Act.  In particular, I believe that 

of especial legal concern are those related to carrier-to-carrier promotions.  These 
conditions limit the number of services and facilities that may be offered to 
competitive local exchangecarriers (CLECs) on a promotional basis. Once the 
caps are reached, some CLECs will be unable to obtain the same promotional 
deals as other CLECs. Quite simply, carrier-to-carrier promotions will not be 
available on an equal basis to all requesting carriers.  In this way, then, the 
conditions violate the "nondiscriminatory access" requirement of section 
251(c)(3), as well as the resale non-discrimination requirement of 251(c)(4)(B).

Moreover, the caps directly conflict with the "pick-and-choose" provision of 
section 252. Section 252(i) requires incumbent LECs to "make available [to a 
CLEC] any . . . service, or network element" provided to any other CLEC "upon 
the same terms and conditions," regardless of the level of offering to others. For 
the reasons given above, the guarantee of that section will be unfulfilled as a 
result of the caps.

Apart from the caps themselves, the underlying discounts on loop rates also 
offend sections 252(i) and 251(c)(3).  These discounts discriminate among 
CLECs -- in terms of prices and offerings -- by creating a situation in which a 
CLEC that uses an ILEC's unbundled switch gets one rate for the loop, but a 
CLEC that uses its own switch gets a discount on the very same loop. 

Separate Statement of Commissioner Harold W. Furchtgott-Roth, Concurring in Part and 
Dissenting in Part, In re Applications of Ameritech Corp., Transferor, and SBC 
Communications, Inc., Transferee, CC Docket No. 98-141 (rel. Oct. 6, 1999).

	I personally solicited further comment on the effect of these merger conditions on 
SWBT’s section 271 application.  See Separate Statement of Commissioner Harold W. 
Furchtgott-Roth, In the Matter of Application by SBC Communications Inc.,Southwestern 
Bell Telephone Company, and Southwestern Bell Communications Services, Inc. d/b/a 
Southwestern Bell Long Distance Pursuant to Section 271 of the
Telecommunications Act of 1996 To Provide In-Region, InterLATA Services In Texas, CC 
Docket 00-4 (rel. April 6, 2000).  

Some parties addressed this issue.  See Comments of AT&T at 62-64.  As I 
review the record, no party submitted information revelatory of the actual effects of the 
loop discounts required in the Commission’s merger Order.  Specifically, the record is 
ambiguous as to whether the cap has been reached or not; and if the cap has not been 
reached, then price discrimination is, at this point in time, just a theoretical possibility.  If, 
in future long distance applications, a party can show that the cap has been reached and 
differential prices are actually being charged, this issue would be live and I would be 
most willing to pursue it further.  At this point, however, the record does not support it. 


*	*	*

	Because I believe that SBWT is providing access and interconnection pursuant to 
Track A agreements as required by those contracts, which in turn incorporate rights 
available to CLECs under sections 251 and 252, I concur in the grant of its application to 
offer long distance service in Texas.
  Indeed, the arbitration award relied upon so heavily by Covad as evidence of 
actual discrimination in violation of section 251 and 271 is captioned “Petition of 
Rhythms Links, Inc. for Arbitration to Establish an Interconnection Agreement with 
Southwestern Bell Telephone Company and Petition of Dieca Communications, Inc. 
d/b/a Covad Communications Company for Arbitration of Interconnection Rates, Terms, 
Conditions, and Related Arrangements with Southwestern Bell Telephone Company.” 

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