20050815Brotherson direct.pdf

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Mary S. Hobson (ISB. No. 2142)
Ted D. Smith (Utah Bar No. 3017)
Stoel Rives LLP
101 South Capitol Boulevard
Suite 1900
Boise, ill 83702-7705
Telephone: [phone]
Facsimile: 208-389-9040
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Thomas M. Dethlefs
Senior Attorney
Qwest Services Corporation
1801 California Street - 10th Floor
Denver, CO 80202
Telephone: [phone]
Facsimile: [phone]
Thomas. Dethlefs~qwest. com
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF LEVEL 3
COMMUNICATIONS, LLC'S PETITION
FOR ARBITRATION PURSUANT TO
SECTION 252(B) OF THE COMMUNICA-
TIONS ACT OF 1934, AS AMENDED BY
TH'E TELECOMMUNICATIONS ACT OF
1996, AND THE APPLICABLE STATE
LAWS FOR RATE, TERMS, AND
CONDITIONS OF INTERCONNECTION
WITH QWEST CORPORATION
CASE NO. QWE- T -05-
Boise-186259.4 0061273-00018
DIRECT TESTIMONY OF LARRY B. BROTHERSON
ON BEHALF OF
QWEST CORPORATION
(Disputed Issue Nos. la, 3, 4, 10, 11, 12, 14, 15, 16, 19)
AUGUST 12th, 2005
Boise-186259.4 0061273-00018
II.
ill.
IV.
VI.
VII.
ABLE OF CONTENTS
Page
ID~NTIFICATION OF ~T~SS........................................................................ 1
PURPOSE OF T~STIMONY .............................
;..................................................
EXECUTIV~ OVER vrnw
...
....................... ......................................................... 5
DISPUTED ISSOO 16: DEFINITION OF VoIP .................................................. 8
DISPUTED ISSOO lA: S~CTION 7.1 OPERATION AUDITS .................
DISPUTED ISSOO lA: S~CTION 7 .2 C~RTIFICA TION.......................... 42
DISPUTED ISSOO 3 VNXX TRAFFIC .............................................................
Vill. DISPUT~D ISSOO 4: COMP~NSA TION FOR VOIC~ AND VoIP
IX.
XI.
XII.
TRAFFIC....... ................................... ..... .............................................................. 67
DISPUTED ISSOO 19: ISP BOUND 3:1 RATIO, Section 7.3.2.................... 69
DISPUTED ISSOO 10: D~FINITION OF INTERCO~CTION ................... 72
DISPUTED ISSOO 11: D~FINITION OF INTE~XCHANG~
CARRIER ...
.... ...... ....... ..... ........ ............ .......... ... ........ ..... ... ....
................. ....... ...... 74
DISPUT~D ISSOO 12: D~FINITION OF "INTRALATA TOLL
TRAFFIC" ........................................................................................................... 77
XIII. DISPUTED ISSOO 9: D~FINITION OF ~XCHANG~ ACC~SS..................... 78
XIV. DISPUTED ISSOO 14: DEFINITION OF ~XCHANG~ S~RVIC~ ................. 79
XV.DISPUT~D ISSOO 15: DEFINITION OF 'TEL~PHO~ TOLL
S~R VIC~' ............................................................................................................ 79
QW~-05-
August 12, 2005
Brotherson L. (Di)
Qwest Corporation
Page iii
IDENTIFICATION OF WITNESS
PLEASE STATE YOUR NAME, BUSINESS ADDRESS AND POSITION
WITH QWEST.
My name is Larry B. Brotherson. I am employed by Qwest Corporation (Qwest)
as a Director Wholesale Advocacy in the Wholesale Markets organization. My
business address is 1801 California Street, Room 2350, Denver, Colorado, 80202.
PLEASE DESCRIBE YOUR EMPLOYMENT BACKGROUND.
Since joining Northwestern Bell Telephone Company in 1979, I'have held several
positions within Northwestern Bell, U S W~ST Communications, and Qwest.
Most of my responsibilities and assignments have been within the Law
Department. Over the past 20 years, I have been a state regulatory attorney in
Iowa, a general litigation attorney, and a commercial attorney supporting several
organizations within Qwest.My responsibilities have included advising the
company on legal issues, drafting contracts, and addressing legal issues that arise
in connection with specific products.With the passage of the
Telecommunications Act of 1996 (the Telcom Act), I took on responsibility for
providing legal advice and support for Qwest's Interconnection Group. In that
role, I was directly involved in working with competitive local exchange carriers
(CLECs). I negotiated interconnection agreements with CLECs that implemented
various sections of the Act, including the Act'reciprocal compensation
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Brotherson, L. (Di)
Qwest Corporation
Page
prOVISIons.In 1999, I assumed my current duties as director of wholesale
advocacy. My current responsibilities include coordinating the witnesses for all
interconnection arbitrations and for hearings involving disputes over
interconnection issues. Additionally, I work with various groups within the
Wholesale Markets organization of Qwest to develop testimony addressing issues
associated with interconnection services.
WHAT IS YOUR EDUCATIONAL BACKGROUND?
I received a Bachelor of Arts degree from Creighton University in 1970 and
Juris Doctor degree from Creighton in 1973.
II.PURPOSE OF TESTIMONY
WHAT IS THE PURPOSE OF YOUR TESTIMONY?
This arbitration docket will address numerous disputed paragraphs to be
incorporated into the interconnection agreement between the parties. The purpose
of my testimony is to support the adoption of Qwest's proposed language relating
to several of the specific issues that Qwest and Level 3 have not been able to
reach agreement on.Specifically, I will explain Qwest's positions, and the
policies underlying these positions.
Although there are many sub-issues, there are three major areas of dispute
between Level 3 and Qwest.
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Brotherson, L. (Di)
Qwest Corporation
Page 2
First, Level 3 and Qwest disagree on a variety of issues related to VoIP (Voice
over Internet Protocol), including the definition of VoIP; whether (assuming
. traffic is properly categorized as VoIP traffic) interexchange calls between local
calling areas ("LCAs ) are exempt from access charges if the call is ultimately
from a V oIP provider; how and under what circumstances access charges or
reciprocal compensation apply to VoIP traffic; the proper routing of VoIP traffic
and other issues.
Second, Level 3 and Qwest disagree on the treatment of and compensation for
VNXX traffic (traffic that does not originate and terminate in the same LCA, even
though the telephone numbers of the called and calling parties would lead the
calling party to believe the call was a local call).
Finally, Level 3 and Qwest disagree on the proper type of and responsibility for
the trunks carrying toll traffic and how Qwest should be compensated for the use
of its network.
My testimony will address the first two issues relating to VoIP and VNXX. Mr.
Easton will address Level 3's reluctance to place toll traffic on Feature Group D
FGD") trunks and pay Qwest for the use of its network. Mr. Linse will address
network issues related to all three areas.
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Brotherson, L. (Di)
Qwest Corporation
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HOW HAVE YOU ORGANIZED YOUR TESTIMONY?
During the negotiation period, Qwest provided Level 3 with a matrix similar in
format to others it has used in many other arbitrations with CL~Cs. The matrix
showed Qwest' s proposed language, and then incorporated Level 3' s proposed
additions in a strikethrough format. Because the Qwest proposed matrix also
followed the contract numbering order, issues dealing with paragraph 5.2 would
be addressed before issues dealing with paragraph 6.4 or 7.1. Level 3 objected to
this format and proposed its own matrix and format. In an effort to advance the
negotiations, Qwest agreed to the use of Level 3' s matrix format. Unfortunately,
the structure that Level 3 uses in its matrix format is difficult to follow.
Level 3 groups contract paragraphs into what it has characterized as "Tier 1"
issues and "Tier 2" issues. In Level 3' s words, Tier 2 issues are "derived" from
Tier 1 issues. Therefore, the language sections in Level 3' s matrix do not flow in
the order of the disputed issues in the contract; instead they follow the order in the
tier structure. Level 3 is, of course, free to use the format it prefers; however, in
order for me to respond to Level 3' s issues in an orderly sequence, it is necessary
to address the competing language in a different order so that necessary pre-
requisite issues are dealt with first. For example, the Level 3 matrix shows the
first issue dealing with VoIP as language in contract sections 7.1 and 7.
which deal with operational audits and certification. Before discussing audits of
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August 12 2005
Brotherson, L. (Di)
Qwest Corporation
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V oIP, it is obviously necessary to understand what VoIP is how the FCC
describes V oIP , and what disagreements exist between the parties as to the
requirements for a call to qualify as VoIP. Therefore, my testimony will start by
addressing Issue 16:the definition of VoIP.Only after the Commission
understands what each party claims are the proper elements of VoIP, will other
VoIP issues be meaningful, such as the issue of the necessity of certification that
VoIP traffic complies with the FCC definition of V oIP. My testimony will
address each disputed paragraph in the agreement related to VoIP and VNXX
even though I address the contract sections in a different order from Level 3'
matrix.My testimony will describe the parties' positions for each disputed
paragraph and demonstrate why Qwest's language is the appropriate language and
should be adopted by the Commission.
III.EXECUTIVE OVERVIEW
PLEASE PROVIDE A GENERAL SUMMARY OF THE ISSUES YOU
ADDRESS IN YOUR TESTIMONY.
Although I address a variety of sub-issues, my testimony addresses two major
issues that are critical to the interconnection agreement: (1) Voice over Internet
Protocol ("VoIP") issues and (2) Virtual NXX ("VNXX") issues.
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Qwest Corporation
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VoIP Issues:
The first issue I address is the proper definition of V oIP. True VoIP calls
are calls initiated through the use of IP-compatible equipment over a
broadband connection. Calls initiated over typical customer premises
equipment ("CP~") on the public switched telephone network ("PSTN")
are not V oIP calls. Through my exhibits, I illustrate valid VoIP calls and
describe other calls that Level 3 improperly claims are VoIP.
I point out that VoIP is treated as an information service under FCC rules
which means that the "~nhanced Services Provider ("~SP") exemption
applies to V oIP calls under certain circumstances. Under the exemption
the location of the ~SP point of presence ("POP") (also referred to as the
VoIP provider POP"), rather than the VoIP customer, is treated as the end
user customer for purposes of determining whether a call is local or
interexchange. Level 3' s position is based on an erroneously broad
reading of the ~SP exemption. Contrary to Level 3' s position, there is no
FCC rule or policy that "exempts" information service providers or calls
from the normal rules governing classification of calls as local or
interexchange-the rule simply moves the customer premises for analysis
purposes from the actual VoIP customer s premises to the location of the
~SP POP.
I comment on a variety of specific language submitted by Qwest and Level
3 related to VoIP issues and demonstrate that Level 3' s proposed language
would treat all VoIP calls as though they were local. I demonstrate that
this is merely convenient fiction to avoid appropriate intercarrier
compensation. When a Qwest end user customer originates a call destined
for a remote VoIP POP (that is, a POP located outside of the local calling
area ("LCA") of the originating caller), that call must be treated as an
interexchange call for all purposes. Likewise, when Qwest receives a call
from a remote VoIP POP for termination in a different LCA that call
should also be treated as an interexchange call for all purposes.
By essentially pretending that VoIP calls from one LCA to another LCA
are local calls, Level 3 seeks special treatment for calls that, from the
perspective of the PSTN, are no different than other interexchange calls.
Level 3' s proposals, if adopted, would dramatically undermine existing
intercarrier compensation and subject carriers to disparate treatment and
would create a windfall for Level 3 at the expense of Qwest's customers.
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Qwest Corporation
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Qwest's proposed language treats VoIP calls consistently with current
intercarrier compensation plans. Local VoIP calls should be treated like
other local calls including making them subject to reciprocal
compensation, ,while VoIP calls that are interexchange in nature should be
subject to appropriate state and federal access charges.
VNXX Issues:
I first define VNXX, which is the inappropriate use by CL~Cs of local
telephone numbers that CLECs are able to obtain for calls that are actually
terminated to customers (usually ISPs) located in different LCAs than the
party making the call.
I demonstrate that the proper means of determining whether a call is local
or interexchange is based on the physical locations of the parties to the call
and not, as Level 3 proposes, based on the telephone numbers. Level 3' s
proposal would result in calls that are interexchange in nature being
treated as though they were local calls.
Level 3' s language acknowledges that with VNXX traffic the called and
calling parties are in different LCAs. Nevertheless, Level 3 would require
treating the call as local and the payment of reciprocal compensation on all
VNXX traffic. By, in effect, treating such traffic as local in nature, Level
3 creates a convenient fiction that dramatically changes the distinction
between local and interexchange calls. Thus, Qwest would be required to
transport large amounts of traffic from distant towns to Level 3 for free
and then be required to pay intercarrier compensation to terminate the
traffic. Yet all of this traffic is generated by customers who, for the most
part, are calling into ISP customers of Level 3. Such a result would be
unfair and inconsistent with current law including a recent decision of the
Commission.
I describe Qwest's foreign exchange ("FX") service and point out the
critical distinctions between FX and VNXX traffic: a Qwest FX customer
(1) actually buys a local connection in each of the LCAs it wants local
access to at local exchange rates and (2) bears the full financial
responsibility to transport that traffic from each LCA back to the LCA
where the call is answered. Under VNXX, the CLEC does neither.
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Brotherson, L. (Di)
Qwest Corporation
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Other Issues:
I address numerous other issues, most of them definitional in nature, that
relate to the VNXX and VoIP issues. In most cases, the Level 3 language
is designed to provide special treatment to its VoIP and VNXX traffic
while Qwest' s language, which has been adopted in many other
interconnection agreements and is consistent with SGA T language
approved by the Commission, is designed to treat Level 3' s traffic in a
manner consistent with how the Commission has determined how local
and interexchange traffic should be handled with other carriers.
IV.DISPUTED ISSUE 16: DEFINITION OF VOIP
BEFORE DEALING WITH THE DEFINITIONAL DISPUTES RELATING
TO VOIP, PLEASE PROVIDE A BRIEF GENERIC DESCRIPTION OF
VOlPe
I will begin by describing the manner in which voice communications have taken
place on the public switched telephone network (pSTN) for decades. The PSTN
is a circuit based, switched network that employs an analog protocol called Time-
Division Multiplexing ("TDM") to transmit voice messages. When one customer
calls another customer under these circumstances, an actual circuit must be
established between the two callers that remains in place for the duration of the
call. Thus, when such a call is made, each party s loop is used for the duration of
the call as are the switches and other facilities through which the call is routed.
Such calls, because of the physical circuit that must be connected from end to end
are often referred to as "circuit-switched.
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Qwest Corporation
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, 1 Both physically and conceptually, VoIP is different. Rather than being based on
an actual physical circuit, VoIP is based on digital packets that are created in a
digital format known as Internet Protocol or "IP." Thus, a VoIP call must be
initiated by an end user customer in IP through the use of IP compatible
equipment, 1 which converts the conversation into multiple digital IP packets of
information (each of which represents a small digitized portion of the voice call
between the parties). Instead of passing over a single circuit, each packet is
capable of independently traveling a different route than other packets. Once the
packets are created by the IP.:.compatible CP~, they are individually forwarded
onto the Internet by routers. As noted because no specific circuit must be
established, a traditional circuit switch is not necessary to establish a circuit and
the packets do not necessarily follow the same path (this is one of the reasons the
The FCC, in its recent VoIP 911 order, described IP Compatible equipment:
The term "IP-compatible CPE" refers to end-user equipment that processes
receives, or transmits IP packets. Users may in some cases attach conventional
analog telephones to certain IP-compatible CPE in order to use an interconnected
VoIP service. For example, IP-compatible CPE includes, but is not limited to, (1)
terminal adapters, which contain an IP digital signal processing unit that performs
digital-to-audio and audio-to-digital conversion and have a standard telephone jack
connection for connecting to a conventional analog telephone; (2) a native IP
telephone; or (3) a personal computer with a microphone and speakers, and software
to perform the conversion (softphone).
First Report and Order and Notice of Proposed Rulemaking, In the Matters of IP-
Enabled Services E911 Requirements for IP-Enabled Service Providers FCC 05-116
, ~
, n. 77 (June 3 2005) (citations omitted) FCC VoIP 911 Order
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Qwest Corporation
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Internet is often depicted as a cloud rather than a physical connection from one
point to another).
Thus, the first distinguishing characteristic of VoIP is that it must be initiated at
the end user customer s premises in IP using IP-compatible CPE. The second
characteristic is that the VoIP call must be initiated over a broadband connection
such as cable modem or DSL that does not pass through the PSTN local switch.
There are two types of VoIP calls that meet these two defining characteristics of
VoIP. One of the types is irrelevant to this case, while the other type of VoIP call
is at the very center of the VoIP issues before the Commission in this docket.
The first type of VoIP call takes place between two VoIP customers, both served
by a broadband connection. The call is, of course, initiated in IP over a broadband
connection. When the called party is also a VoIP customer on a broadband
connection, the call is never converted into TDM (the language of the circuit-
switched PSTN). Instead, the packets are transported over the Internet directly to
the called party, where the called party s IP compatible equipment reassembles the
packets in the proper order so they become a voice conversation again. The
breakdown into IP packets, the transmission of the individual packets, and the
reassembly of the IP packets into voice sounds all take place on the Internet or a
private IP network. If, as in the foregoing example, a call goes from one IP
capable piece of equipment to another IP capable piece of equipment, over
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Qwest Corporation
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broadband connections through transmission IP packets, the call is completed
without ever touching the circuit switched PSTN. Thus, this type of call is a VoIP
call, but it does not interconnect with the PSTN in any manner. Because such
calls originate and terminate in IP format, they are often referred to as "IP-
calls." They occur entirely over the Internet, are not exchanged between carriers
and there are therefore no intercarrier compensation or other interconnection
issues that result from IP-IP traffic. Such calls are therefore completely irrelevant
to the issues in this case.
The second type of VoIP is central to the VoIP issues in this docket. This is a call
that is initiated through IP-compatible CP~ over a broadband connection, but the
called party is not a VoIP customer. Instead, the called party is a typical customer
served on the PSTN by a loop attached to a circuit switch and whose CPE is not
IP-compatible. In this situation, the exchange of traffic is completely different
than in the first type of call. In order to complete the call, the IP packets created
by the equipment of the calling ,party must, at some point (a function of the VoIP
provider s equipment) be converted into a TDM voice format, transferred to the
PSTN on a connection that will route through circuit switches to the end office
serving the customer, and finally sent over the loop to the customer. This type of
call, which is often referred to as an "IP- TDM call" because it was originated in IP
format and terminated to the PSTN in TDM format, is a VoIP call because it
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Qwest Corporation
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meets the criteria of originating in IP format using IP-compatible CP~ over a
broadband connection. It is terminated, however, using local switching and loops.
This type of call creates intercarrier compensation and other issues that must be
dealt with in this docket.
There is a third type of call that, while it is not a VoIP call, is an issue here
because of the manner in which Level 3 has defined VoIP traffic. In this type of
call, the call is originated in TDM format, but the carrier (most likely for network
efficiency reasons) decides to transport the call from two points in IP before
reconverting it into TDM for delivery. Although this call was in IP format for part
of the transmission, it both originates and terminates in TDM. Such calls are
often referred to as "TDM-IP- TDM calls" or as "IP in the middle" calls. Because
such calls do not meet the criteria for V oIP described above, they are not V oIP.
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
16.
Issue 16 focuses' on the appropriate definition of VoIP in the context of the second
type of call described above, traffic originating from a VoIP customer in IP that is
terminated over the PSTN in TDM. It is this type of traffic that raises issues in
this docket. The first type (IP-IP), because it never enters the PSTN, is not
addressed by the interconnection agreement.
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Qwest Corporation
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WITH THAT BACKGROUND, PLEASE DESCRIBE THE ISSUES THAT
ARE RAISED)JY THE COMPETING VOIP DEFINITIONS.
The ultimate issues relate to intercarrier compensation. Qwest's definition centers
on two basic issues related to VoIP:
What requirements must be met to permit a VoIP provider to terminate
calls using a local exchange product for its connection rather than a Switched
Access (Feature Group D) connection?
Assuming a VoIP provider is qualified to purchase a connection out of the
local exchange catalogs, how are calls that terminate within and outside the local
calling area ("LCA") in which the VoIP provider is physically located handled?
WHY DOES THE QWEST DEFINITION REQUIRE THAT A VOIP CALL
ORIGINATE IN IP OVER A BROADBAND FACILITY USING IP
EQUIPMENT IN ORDER TO BE ENTITLED TO TERMINATION
THROUGH A LOCAL NETWORK CONNECTION?
The first reason is simply that this definition appears to be consistent with the way
the FCC has thus far defined VoIP.
The second reason is far more complicated. It relates to a historic category of
providers known as ESPs. Under current FCC rules (all of which are subject to
being changed when the FCC makes its final decisions on these issues) providers
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Qwest Corporation
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of VoIP are considered to be ~SPs. ESPs are entitled to terminate calls through a
connection to the PSTN purchased through a local service connection under
certain circumstances. But a VoIP provider is considered an ~SP only if the call
meets the fundamental requirements to qualify as VoIP: the call must originate in
IP through the use of IP-compatible CP~ over a broadband facility. This is the
only type of call that meets the definition of VoIP proposed by Qwest and is thus
the only type of traffic that qualifies for the ESP exemption.
If a call originates as a voice call on the PSTN and is then terminated as 'a voice
call on the PSTN, this is a TDM-IP- TDM or "IP in the middle" call, which is
subject to typical intercarrier compensation rules: if it is a local call, it is subject to
reciprocal compensation; if it is an interexchange (toll) call it is subject to access
charges such as Feature Group D. The FCC ruled in the AT&T Declaratory
Ruling that this type of call is not a VoIP call even if at some point during the call
it was converted to IP because, before delivery, it was reconverted to TDM and
delivered over the PSTN.2 Since, in this proceeding, we are only addressing the
calls that Qwest is being asked to terminate on the PSTN, the termination of each
call is in TDM over the PSTN. Thus, if the call is not originated in IP over a
Order In the Matter of Petition for Declaratory Ruling that AT&T's Phone-to-Phone
IP Telephony Services are Exemptfrom Access Charges WC Docket No. 02-361 , FCC
04-, 19 FCC Rcd 7457, ~~ 12-13 (April 14, 2004) (ruling that AT&T's service was a
telecommunications service and is subject to access charges) AT&T Declaratory
Ruling
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Qwest Corporation
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broadband facility, it will be both originating and terminating in traditional PSTN
format, thus losing its current status as an enhanced or information service call
and access charges will apply.
YOU MENTIONED THE ESP EXEMPTION. CAN YOU DESCRIBE IT
FOR US?
First, the ESP exemption is relevant to this docket because, under current rules
that are the subject of ongoing FCC consideration, true VoIP service qualifies as
an "information service." Thus, V oIP providers served by Level 3 are entitled to
receive service pursuant to the ESP exemption, but only in very specific
circumstances. All of this ultimately becomes relevant to how VoIP is defined
and to the intercarrier compensation regime that applies under certain
circumstances.Thus, it is important for the Commission to understand the
fundamentals of the ~SP exemption.
The ESP exemption has a long history with the FCC. It was originally established
at the time access charges were established following the Modified Final
Judgment (MFJ) that governed the divestiture of the old Bell System. While
establishing the access charge regime in use today for all interexchange carriers
IXCs ), the FCC permitted ESPs to connect their POP to the local network via
local exchange service as opposed to feature group services that IXCs were (and
still are) required to purchase, even though the ESPs used the local exchange
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facilities for interstate access. The ~SP exemption was never really an exemption
at all-it was simply a regulatory decision that, for ,a variety of policy reasons,
interstate access by ~SPs located within a LCA would be treated as local for
purposes of assessing the correct access charge. Thus, under the exemption, the
~SP can order a local service connection to its POP in the same manner as the
service can be ordered by other end user customers located within a particular
LCA. In other words, under the ~SP exemption, the ~SP is treated like an end
user customer as opposed to an IXC for purposes of obtaining access to a LCA.
In that LCA, the ~SP can obtain the same business services that any other end
user business can obtain on a retail basis. The effect of the exemption, then, is
that unlimited calls may be terminated by the ~SP within such LCAs and it will be
charged typical retail business rates instead of access charges to do so. But that is
the extent of the exemption. For example, to the extent the ~SP seeks to
terminate calls to customers within the LATA but outside that LCA, the
exemption does not apply and the calls will be handed off to the end user
customer s (i.e. the ~SP's) Primary Interexchange Carrier ("PIC") choice for
delivery to the other LCA. Qwest Exhibit No. 301 depicts the two examples. In
Qwest ~xhibit No. 301 , I depict the termination of VoIP calls from the Internet
through valid routing. When the VoIP provider and the end user customer are in
the same LCA, the ~SP (Level 3 in the exhibit) obtains a local connection to the
network by purchasing Local Interconnection Service ("LIS") in Boise. In this
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Qwest Corporation
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example, the call is handed off by the ~SP within the Boise LCA for termination
to a Qwest end user customer also in the Boise LCA via the LIS trunk. The
exhibit further shows a call where the ~SP is within the Boise LCA and the Qwest
end user customer is located in the Twin Falls LCA. The call is routed through
use of the PICed IXC using FGD trunks for termination to the end user customer.
This is explained in more detail in the following section.
CAN YOU DESCRIBE THE REQUIREMENT THAT CALLS WITHIN
THE LCA WHERE THE VOIP PROVIDER PURCHASES A LOCAL
CONNECTION ARE LOCAL AND CALLS BOUND FOR LOCATIONS
OUTSIDE THE LCA ARE TOLL?
Yes. Under current rules, a voice call between separate LCAs is a toll call and
must be treated as such. This rule applies equally to VoIP. Thus, when a call is
originated in IP format on IP-compatible equipment and is handed off to Qwest
within a LCA where the ~SP is located, but the call is being sent for termination
to another LCA, the provider is not entitled to free transport to the terminating
LCA under the ~SP exemption or on any other basis, nor is it allowed to connect
to the terminating LCA as an end user customer under the ESP exemption if it
does not have a physical presence in that LCA. Calls of this sort are properly
classified as interexchange traffic and must be handed off to an IXC, which must
connect to Qwest typically via a Feature Group connection. Assuming a call is
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VoIP, and has been converted from IP protocol to PSTN protocol, the call can be
delivered to Qwest over Local Interconnection Service (LIS) trunks if, and only if
the hand off to Qwest is for termination of the call within the same LCA as the
VoIP provider s POP. Because the VoIP provider (as an ~SP) purchases its
connection to the local network as an end user customer, the call will be treated as
a local call and no access charges would apply if the call is sent to a party
physically located in the same LCA as the VoIP provider s POP. It would also be
treated as a local call for section 251 (b )( 5) reciprocal compensation purposes.
the hand off is for termination at a distant local exchange outside of the LCA
where the VoIP POP is located, the call must be delivered to Qwest on FGD for
termination to that LCA. The second call example on Qwest ~xhibit No. 301
shows a call from a VoIP provider s POP (end user customer) in Boise who seeks
to complete a call to Twin Falls. In that example the call is handed off to the IXC
PICed by the end user customer (or VoIP Provider), and the IXC delivers the call
to Twin Falls over Feature Group D. If the VoIP Provider purchases a local
connection from its POP to the Qwest local switch in Boise, then Qwest's switch
will recognize the call to Twin Falls as a toll call and route the call to the
appropriate !XC. If the VoIP Provider purchases a local connection from its POP
to the Level 3 switch in Boise then Level 3' s switch is required to route the call to
an IXC.
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Because the ~SP is entitled to purchase a local connection in the Boise LCA
rather than a FGD connection to terminate VoIP traffic in the Boise LCA, the calls
from the Boise VoIP POP to Boise residents are treated as local calls. This is true
whether the VoIP provider purchases that local connection from Qwest or Level 3.
But the ~SP exemption does not extend beyond the LCA in which the ~SP has a
presence. Thus, calls from a VoIP POP in Boise to Qwest end user customers in
Twin Falls, or, for that matter, to end user customers in New York or Hong Kong,
is required to be routed to an IXC for completion. In those cases, the IXC, not the
VoIP provider, will pay access charges associated with transporting and
terminating the call. The foregoing examples demonstrate the status of the proper
application of the FCC ~SP exemption and the proper routing and intercarrier
compensation for interexchange calls under current rules.
THE FCC HAS DISTINGUISHED VOIP TRAFFIC THAT CONNECTS
TO THE PSTN FROM VOIP TRAFFIC THAT IS TRANSPORTED
SOLELY OVER THE INTERNET OR A PRIVATE IP NETWORK. IS
THE DISTINCTION RELEVANT TO THE DISCUSSION OF VOIP IN AN
INTERCONNECTION AGREEMENT?
Absolutely. The FCC has been careful to distinguish VoIP traffic that connects to
the PSTN from VoIP traffic that is handled entirely by the Internet, specifically
using the term "interconnected VoIP services" to describe "those VoIP services
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that can be used to receive telephone calls that originate on the PSTN and can be
used to terminate calls to the PSTN."3 The FCC singled out Interconnected VoIP
services because "consumers expect that VoIP services that are interconnected
with the PSTN will function in some ways like a "regular telephone" service.
Interconnected V oIP service was defined "as bearing the following chara~teristics:
(1) the service enables real-time, two-way voice communications; (2) the service
requires a broadband connection from the end user customer s location; (3) the
service requires IP-compatible CP~; and (4) the service offering permits users
generally to receive calls that originate on the PSTN and to terminate calls to the
PSTN."S The issues between Qwest and Level 3 with regard to VoIP relate
specifically to Interconnected VoIP traffic that is terminated or transmitted to the
Qwest network (i., to the PSTN).
WHAT IS THE DIFFERENCE BETWEEN QWEST'S AND LEVEL 3'
PROPOSED DEFINITIONS OF VOIP?
If is easy to see the distinction between the two company s positions by looking at
the language in dispute. Qwest's proposed definition ofVoIP traffic for the
interconnection agreement with Level 3 is shown in the paragraph below. All of
FCC VoIP 911 Order~ 23.
Id.
Id. ~ 24.
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Level 3's proposed changes are in bold face type and the language Level 3
proposes to be deleted is shown as a strikethrough. Where Level 3 seeks to add
additional language to the paragraph, the proposal is shown in a bold underlined
format.
VoIP" (Voice over Internet Protocol) traffic is traffic that originates in
Internet Protocol using IP- Telephone handsets, Internet Protocol (IP) adapters
CP~-based Internet Protocol Telephone (IPT) Management "plug and play
hardware, IPT application management and monitoring hardware or such
similar equipment and is transmitted over a broadband connection to or from
the VoIP provider.
Qwest's definition is pictorially illustrated in Qwest ~xhibit No. 302 attached to
this document.
WHAT IS THE EFFECT OF LEVEL 3'S DELETIONS FROM QWEST'
PROPOSED LANGUAGE?
By making these deletions, Level 3 is asking the ' Idaho Commission to
dramatically modify the FCC prescribed method of treating ~SPs. The FCC made
its position very clear in the ~SP ~xemption order:
18 .Under our present rules, enhanced service providers are treated as end users
for purposes of applying access charges. See 47 C.R. ~ 69.2(m);
Northwestern Bell Telephone Company Petition for a Declaratory Ruling,Memorandum Opinion and Order FCC Rcd 5986, 5988 at para. 20 (1987),
appeal docketed, No. 87-1745 (D.Cir. Dec. 4, 1987). Therefore, enhanced
service providers generally pay local business rates and interstate subscriber
line charges for their switched access connections to local exchange company
central offices. "6
Order In the Matter of Amendments of Part 69 of the Commissions Rules Relating to
Enhanced Service Providers 3 FCC Rcd 2631 , ~ 2, n.8 (1988) ESP Exemption
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The FCC was clear on how an ~SP would be treated. Level 3' s language is a
direct attempt to avoid the FCC's ruling.Level 3 seeks to delete Qwest'
language in an explicit attempt to avoid access charges when a call is between two
LCAs (i., avoid access charges on calls that are clearly interexchange in nature).
The Qwest language that states that the VoIP Provider s POP will be treated as an
end user customer must be incorporated into the agreement because that is
precisely the manner in which the ~SP exemption operates (under the exemption
the ~SP is treated as an end user customer). Thus, Qwest's language that the
VoIP Provider s POP will be considered as an end user customer for purposes of
determining the end points of the call is essential in order to resolve any doubt
that if the call is transported to another LCA in the LATA, to another LATA, to
another state, or to another country, the call must be delivered to an IXC and the
IXC that transports the call will be responsible for access charges. Otherwise, the
interconnection agreement will enable Level 3 to provide a service to ~SPs (or to
itself acting as an ESP) that gives it access to Qwest's entire network essentially
free of charge to terminate IXC traffic.
Order ). See also id. ~ 20, n. 53 ("Thus, the current treatment of enhanced service
providers for access charge purposes will continue. At present, enhanced service
providers are treated as end users and thus may use local business lines for access for
which they pay local business rates and subscriber lines charges. To the extent that
they purchase special access lines, they also pay the special access surcharge under the
same conditions as those applicable to end users.
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As Qwest understands Level3's proposal (which essentially treats all VoIP traffic
as though it were local traffic), Qwest would receive reciprocal compensation for
terminating such traffic.The reciprocal compensation rate, of course
dramatically less than FGD rates and was never designed for the termination of
interexchange traffic (reciprocal compensation traditionally applies to the
termination of local traffic only). Thus, Level 3' s proposal would result in a
fundamental restructure of intercarrier compensation on traffic that, other than the
manner in which it originates, looks precisely the same to the PSTN as any other
interexchange traffic. As the Commission reviews this matter, Qwest suggests
that it refuse to consider such an elemental change in intercarrier compensation.
To the PSTN, there is no difference between a typical interexchange call that
terminates on the PSTN (and is therefore subject to appropriate access charges)
and a VoIP originated call that, once it is converted into TDM, is placed on the
PSTN for termination.Qwest is unaware of any good reason, let alone
compelling reason, to treat these calls in a completely different manner for
intercarrier compensation purposes. Level 3' s proposal should, therefore, be
rej ected.
For traffic to meet Qwest's VoIP definition, it must originate in IP; otherwise it is
simply another call originated in TDM that terminates in TDM. Consistent with
the FCC's ruling discussed above and in more detail below, Qwest's definition
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requires that the call originate in IP using IP CP~ and be transmitted over a
broadband connection to the VoIP Provider. Unless it meets these requirements it
will fail to meet the criteria of the FCC in the AT&T case discussed above, where
the FCC rejected AT&T's effort to avoid access charges on calls that originate
and terminate in TDM.
Qwest's definition also identifies VoIP is an "information service " a contention
that Level 3 does not appear to challenge. Designating VoIP as an information
service in Qwest's definition makes the PSTN portion of the service subject to
interconnection and compensation based on treating the VoIP Provider s POP as
an end user customer s premises. Therefore, LIS trunks may be used to terminate
VoIP traffic based on rules that apply to other end user customers, including the
requirement that the VoIP Provider s POP (served by Level 3) where the VoIP
traffic is delivered to the public network be physically located in the same LCA as
the called party. Other types of VoIP calls can also be delivered to Qwest for
termination, of course, but since they do not qualify for the ~SP exemption, such
traffic should be classified as toll traffic and all existing access rules are
applicable to it.
WHAT IS THE EFFECT OF LEVEL 3'S FIRST TWO CHANGES?
Level 3 attempts to remove the requirement that the call must originate at the end
user premises and to strike the words "end user premises" when referring to "end
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user customer s premises IP adapters." Origination at the end user premises in IF
is a critical requirement that must remain in the agreement. The rationale for
Level 3' s effort to delete this requirement from the definition is far from clear (it
certainly did not make it clear in its Petition), but it is an essential piece of the
definition of VoIP. First, under the ICA, these calls will terminate on the Qwest
local network (the PSTN). As mentioned above, when an end user customer call
is originated on the PSTN, routed over PSTN loops to a PSTN switch, and Level
3 terminates the same call on the PSTN, that call does not qualify as an enhanced
or information service. It is irrelevant that a VoIP provider may have converted it
to IP protocol in the middle for some distance. A call not originating over
broadband in IP does not meet the requirements for the FCC ~SP exemption. The
FCC made this perfectly clear in 2004 in its Phone-to-Phone IP exemption
decision (the AT&T Declaratory Order
),
where the FCC determined that a
service that begins on the PSTN and ends on the PSTN, even though it may use
the Internet for a portion of the transport of that service, offers no net protocol
conversion, and is therefore a telecommunications service (as opposed to an
information service):
The service at issue in AT&T's petition consists of an interexchange call that
is initiated in the same manner as traditional interexchange calls-by and end
user who dials 1 + the called number from a regular telephone. When the call
reaches AT&T's network, AT&T converts it from its existing format into an
IP format and transports it over AT&T's Internet backbone. AT&T then
converts the call back from the IP format and delivers it to the called party
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local exchange carrier (L~C) local business lines. We clarify that, under the
current rules, the service that AT&T describes is a telecommunications service
upon which interstate access charges may be assessed. We emphasize that our
decision is limited to the type of service described by AT&T in this
proceeding, i.e. an interexchange service that: (1) uses ordinary customer
premises equipment (CP~) with no enhanced functionality; (2) originates and
terminates over the public switched telephone network (PSTN); and (3)
undergoes no net protocol conversion and provides no enhanced functionality
to end users due to the providers use ofIP technology.
Thus, if Level 3 delivers an IP long distance call to Qwest for termination on
Qwest's PSTN and the call did not originate in IP over a broadband connection
the FCC has ruled that such a call is not exempt from access charges. If, however
the call originates in IP (using the appropriate IP equipment) over a broadband
connection, and is then converted into traditional TDM protocol for termination
on the PSTN to a local telephone number, there has been a net protocol
conversion and the call qualifies as an enhanced or information service. Since the
terminating end, the call being delivered to Qwest for termination is always in
TDM protocol, it must originate in IP at the originating end user customer
premises in order to be exempt.Originating in IP can only occur over a
broadband connection. If it both originates and terminates in the PSTN protocol it
is not an enhanced or information service under the FCC's rules.Qwest'
definitional language makes it clear that VoIP:
originates in Internet Protocol at the premises of the party making the call
using IP- Telephone handsets end user premises Internet Protocol (IP)
AT&T Declaratory Order ~ 1.
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adapters, CP~-based Internet Protocol Telephone (IPT) Management "plug
and play" hardware, IPT application management and monitoring hardware or
such similar equipment and is transmitted over a broadband connection to the
VoIP provider.
Qwest's language requiring that the call originate at the end user customer
premises in broadband is also an absolute necessity if the call is to be treated as an
enhanced or information service and thus entitled to the ESP exemption. Any
attempt by Level 3 to remove this requirement from the contract will, in effect
modify the ~SP exemption and authorize it to do what the FCC said AT&T could
not do: take simple calls that originate on the PSTN, deliver them to Qwest in
another LCA, terminate the call on the PSTN, and claim the call is exempt from
access charges.Thus, Level 3' s first two strikethrough proposals must be
rej ected. The call must originate over broadband in IP to be an enhanced or
, information services VoIP call.
Next, Level 3 proposes some perplexing language to the VoIP definition regarding
traffic direction, wanting it to read that VoIP may be "transmitted over a
broadband connection to or from the VoIP provider . What these additional tenns
mean is not clear. For example, calls delivered to Qwest from a VoIP provider for
termination will go through a Qwest switch and over a loop connected to that
switch for tennination on the PSTN to a traditional telephone. However, a call
from the VoIP provider that transits directly to a VoIP end user customer over
broadband will not go through a public network switch and thus, the PSTN is not
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used to complete the call.8 As such, Qwest would not be involved in switching
the call on the PSTN and Level 3's proposed language is inappropriate. I
unaware of any other situation or scenario in which a call would come from the
VoIP provider in broadband that would involve Qwest or the PSTN. These first
two changes go to the heart of what is a VoIP call. They make clear what type of
calls an ~SP is entitled to purchase access to the public network from the Qwest
(or Level 3) local exchange services catalog as an enhanced service and not
through FGD, as prescribed by the FCC. Qwest's language is critical to the
definition and accurately limits the ESP exemption to only qualified situations. It
must be adopted.
WHAT IS THE THIRD CHANGE THAT LEVEL 3 PROPOSES TO THE
QWEST DEFINITION OF VOIP?
Level 3 proposes to strike the entire remaining language from the definition. This
language describes how VoIP traffic will be treated under the interconnection
agreement as well as establishing the interconnection compensation rules that
apply to VoIP traffic. However, while Qwest believes this language is critical and
must be incorporated into the interconnection agreement, Qwest is amenable to
placing the language in the main section of the agreement. Regardless of where it
The call may use Qwest facilities, but not for termination; for example, if the end user
leases a direct broadband connection to the VoIP provider.
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is placed, Qwest strongly believes language for the treatment of VoIP traffic is
necessary to avoid future disputes.
HOW DO YOU PROPOSE TO INCLUDE THIS LANGUAGE IN THE
AGREEMENT?
Section 7.2 of the Interconnection Agreement addresses exchange of traffic. A
subset of that section, 7., discusses the terms and conditions for the exchange
of traffic. The terms and conditions describing the exchange of VoIP traffic
should be located in the next available subsection, 7.12.I propose the
remaining language from the definition of VoIP above be inserted under Section
2 as follows:
12 VoIP Traffic. VoIP traffic as defined in this agreement
shall be treated as an Information Service, and is subject to interconnection
and compensation rules and treatment accordingly under this Agreement based
on treating the VoIP Provider Point of Presence ("POP") is an end user
premise for purposes of determining the end points for a specific call.
12.CLEC is permitted to utilize LIS trunks to terminate
VoIP traffic under this Agreement only pursuant to the same rules that apply
to traffic from all other end users, including the requirement that the VoIP
Provider POP must be in the same Local Calling Area as the called party.
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LEVEL 3 OBJECTS TO THE REQUIREMENT THAT THE VOIP
PROVIDER POINT OF PRESENCE (POP) BE CONSIDERED AN END
USER CUSTOMER FOR PURPOSES OF DETERMINING THE END
POINTS OF A CALL. CAN YOU COMMENT?
The language requiring that the VoIP POP be considered an end user customer
was a portion of the definitions moved into the body of the agreement at 7.12.
Level 3' s definition deletes that language. The language is critically important
due to the ~SP ~xemption, and must be included somewhere in the agreement.
Since both Level 3 and Qwest agree that the traffic that is handed off to the public
network from the VoIP POP arrived over the Internet and is an alternative to
traditional IXC traffic, the only real question is whether or not the VoIP provider
must purchase FGD to terminate its calls. In answer to that question, the FCC has
said no. If the VoIP provider is acting as an ESP, it is entitled to purchase its
connection out of the local exchange service catalog and obtain local service
within the LCA where it is physically located. In this respect, the ~SP is treated as
any other end user customer.
BASED UPON THESE FACTS WHAT SHOULD THE COMMISSION DO
WITH RESPECT TO ISSUE 16, DEFINITION OF VOIP?
For all the reasons stated above, the Commission should adopt Qwest's proposed
definition of VoIP that includes the requirement that the call must originate at the
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premises of the party making the call, through the use of IP-compatible CP~, over
a broadband circuit in IP to avoid the scenario of calls the both originate and
terminate as PSTN calls. Further, consistent with the proper criteria for VoIP and
with the FCC's ESP ~xemption, neither PSTN to PSTN calls are VoIP and are not
entitled to the ~SP exemption under FCC decisions. Qwest's proposed language
for Sections 7.12 and 7.2.12.1 , make clear that VoIP traffic as defined in
this agreement will be treated as an information service, will be entitled to the
~SP exemption, and the VoIP providers POP will be treated as an end user
customer s premises for purpose of determining the end points of a call. This will
ensure that the intrastate access regime as currently approved by this Commission
is not changed at this time. The Commission, therefore, should adopt Qwest'
proposed language.
PLEASE SUMMARIZE QWEST'S BASIC POSITIONS ON VOlPe
The first issue is the proper definition of VoIP. Consistent with FCC decisions
there are two key essential features that must be present for a VoIP call: (1) the
call must originate on IP-compatible CP~ (both Qwest's and Level 3's language
provides greater detail on the proper description of such CP~) and (2) it must also
originate on a broadband connection, such as DSL, cable modem, or other
equivalent high-speed connection to the Internet. If these two criteria are not met
then the call cannot be deemed to be V oIP.
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In the context of that definition, three types of calls must be considered: (1) calls
that meet the criteria for VoIP traffic that are terminated to another VoIP customer
who likewise has IP-compatible CP~ and served over a broadband connection
(commonly referred to as IP-IP traffic); (2) calls that meet the criteria for VoIP
traffic, but which are terminated to a customer served on the PSTN on a telephone
line to a customer that uses traditional telephone CP~ (commonly known
IP- TDM traffic); and (3) traffic that originates in TDM but which is converted to
IP at some point and then converted back to TDM for delivery to the called party
(commonly known as "TDM-IP-TDM" or "IP in the middle" traffic).
PLEASE ADDRESS EACH TYPE OF TRAFFIC AND DESCRIBE
QWEST'S POSITION AS TO THE PROPER TREATMENT OF EACH
UNDER THE INTERCONNECTION AGREEMENT.
I will first address IP-IP traffic. This type of traffic clearly meets the criteria for
VoIP. However, because both the calling and called parties are VoIP customers
served by broadband connections, the call remains in IP, is transported entirely
over the Internet, and never enters the PSTN. Thus, it is not relevant to the
interconnection agreement at issue in this docket.
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PLEASE DISCUSS IP- TDM TRAFFIC.
From Qwest's perspective, this is the only VoIP traffic at issue in this docket. IP-
TDM traffic meets the criteria for VoIP traffic because it is originated with IP-
compatible CPE over a broadband connection.
There is really only one specific implication of the status of IP- TDM traffic as
VoIP traffic that distinguishes it from the rules that apply to other traffic. That is
the application of the so-called ~SP exemption. Both parties agree that, until the
FCC definitively rules on the issue, VoIP will be treated as an "information
service" under the Act. Thus, under certain circumstances, the provider of true
VoIP service is classified as an ~SP and where applicable, qualifies for the
exemption. While it is unclear from the Level 3 Petition, Level 3 appears to
believe the exemption applies much more broadly than Qwest believes it does.
Under the proper application of the exemption, a VoIP provider is treated as an
end user customer for purposes of access to a LCA in which the VoIP provider
maintains a point of presence ("POP"). Level 3, however, appears to believe that
either through the application of the ~SP exemption or for some other undisclosed
reason, VoIP providers are entitled to LATA-wide exemption from access
charges. Qwest adamantly opposes that position on both legal and policy grounds.
Thus, for purposes of termination of IP- TDM traffic in the LCA in which the
VoIP provider POP is located, the VoIP provider is allowed to terminate that
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traffic with Qwest through the same types of retail services available to other
business end user customers as opposed to being required to ' origin~te and
terminate traffic through access charges. But that is the full extent of application
of the exemption.
Thus, for all other applications of intercarrier compensation, the same rules that
apply to all other traffic apply to IP- TDM traffic. Rather than determining the
application of these rules from the physical location of the VoIP end user
customer that actually originates the call, the VoIP provider POP is treated as the
end user location. Thus, as explained in the next section, if the VoIP provider
POP is physically located in the same LCA as the called party, the call is treated
as local, and reciprocal compensation would apply.Likewise, if the VoIP
provider POP is in a different LCA from the called party, the call is an
interexchange call that should be handed off to the IXC selected by the end user
customer, which transports the call to the LCA of the called party, where Qwest
terminates it to its end user customer. The IXC would pay the appropriate access
charges to terminate the traffic.
, In summary, under Qwest's proposed language, other than for the application of
the ESP exemption, IP- TDM traffic should be treated in the same manner as other
similar traffic.Level 3 appears' to propose that these traditional means of
intercarrier compensation be completely scrapped in favor of treating all VoIP as
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though it were local traffic. Thus far, Level 3 has not offered any compelling
legal reason why VoIP should be given special treatment. Th~re is certainly no
good policy reason.It is easy to see why Level 3 wants to change the
compensation scheme in such a radical manner; it would allow Level 3 or its VoIP
provider customers to avoid charges that other identically-situated carriers must
pay. Qwest strongly opposes such an approach.
PLEASE DISCUSS TDM-IP- TDM (IP IN THE MIDDLE) TRAFFIC.
While Level 3 also appears to seek special treatment for this traffic, it should not
receive it. Because this traffic originates in TDM, it does not meet the criteria for
VoIP traffic. Therefore, as the FCC clearly ruled in the AT&T decision, this
traffic is not V oIP, is not an information service (and thus does not qualify for the
~SP exemption), and therefore is not exempt from access charges that apply to
other carriers in identical circumstances. Thus, Qwest's language treats this type
of traffic no different than any other TDM originated traffic for intercarrier
compensation purposes. The Commission should reject Level 3' s efforts to
remove this traffic from existing intercarrier compensation rules and should adopt
Qwest's language.
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DISPUTED ISSUE lA: SECTION 7.1.1.1 OPERATION AUDITS
PLEASE DESCRIBE THE PARTIES'DISPUTE RELATING TO ISSUE
lA.
This dispute first highlights the reason that I am addressing the issues in a
different order than that presented by Level 3. In its petition and matrix, Level 3
lists issue lA as the first of its Tier 1 issues. This single issue number, lA, has
three Qwest proposed paragraphs, and six Level 3 proposed paragraphs even
though in some instances, they have the same number; for example 7.1.1.1 , the
two paragraphs are totally unrelated and deal with totally different issues. My
testimony in this section will deal with two of the Qwest proposed paragraphs
1 Verification audits, and 7.2 VoIP certification. Although this is listed
as the first issue on Level 3' s matrix, an understanding of the parties disagreement
over what VoIP is, which I discussed above in issue 16, is necessary to understand
the dispute about the language of 7.1. The third Qwest proposed paragraph in
issue lA is 7.1.1 , which deals with points of interconnection. Mr. ~aston s and
Mr. Linse s will address that in their testimony along with the six Level 3
proposed paragraphs in issue lA.
WHAT IS QWEST'S PROPOSED LANGUAGE FOR 7.1.1.1?
Qwest's proposal for section 7.1.1.1 of the interconnection agreement states:
7 .CL~C agrees to allow Qwest to conduct operational verification
audits of those network elements controlled by CL~C and to work
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cooperatively with Qwest to conduct an operational verification audit of any
other provider that CLEC used to originate, route and transport VoIP traffic
that is delivered to Qwest, as well as to make available any supporting
documentation and records in order to ensure CL~C's compliance with the
obligations set forth in the VoIP definition and elsewhere in this Agreement.
Qwest shall have the right to redefine this traffic as Switched Access in the
event of an "operational verification audit failure . An "operational
verification audit failure" is defined as: (a) Qwest's inability to conduct a
post-provisioning operational verification audit due to insufficient cooperation
by CL~C or CL~C' s other providers, or (b) a determination by Qwest in a
post-provisioning operational verification audit that the CL~C or CL~C's end
users are not originating in a manner consistent with the obligations set forth
in the VoIP definition and elsewhere in this Agreement.
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR SECTION 7.1.1.1?
This is somewhat confusing. Apparently because Level 3 does not believe there
should be any provision in the contract for audits to assure the traffic is V oIP
Level 3 offers no changes to Qwest's proposed language and simply wants it
stricken. Since Level 3 presumably believes the Qwest language will be stricken
Level 3 went ahead and used the 'available' number 7.1.1.1 to introduce an
unrelated issue dealing with single point of interconnection (SPOI). My testimony
will address the Qwest proposed 7.1 dealing with verification audits of VoIP
traffic and which will require Commission resolution and a decision on the
situations in which Qwest's 7.1.1.1 is acceptable. Mr. Easton s testimony will
address the SPOI issue. In addressing the dispute with Level 3 over the SPOI, he
will address the second proposed paragraph numbered 7.1 (Level 3' s SPOI
language) .
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WHAT IS THE DISPUTE WITH REGARD TO QWEST'S PROPOSED
PARAGRAPH 7.1.1.1?
Level 3 seeks to strike Qwest language which is necessary so that Qwest can
verify that the traffic that Level 3 identifies as VoIP traffic is valid VoIP traffic
entitled to the ESP exemption. Determining whether the traffic is proper VoIP
traffic has implications for a determination of whether it is local or interexchange
for the application of the appropriate intercarrier compensation regime. Thus, the
proper classification of traffic impacts the compensation obligations of both
Qwest and Level 3. Only traffic that qualifies as an ~nhanced or Information
Service is entitled to the FCC's ~SP exemption. Only VoIP traffic that originates
on broadband in IP can be terminated on the PSTN in TDM protocol under the
~SP ~xemption. Thus, verification is critical.
First, the Qwest proposed language gives Qwest the right to do a verification audit
to assure that the VoIP traffic being delivered to Qwest for termination complies
with the definition and obligations of VoIP in this agreement. As discussed
above, the definition of VoIP is strongly disputed. Second, the contract makes
clear that when traffic does not qualify for the ESP exemption, an exemption that
alleviates the requirement to purchase switched access connections to the local
network, that Qwest has the right to redefine the non-qualifying traffic as
Switched Access. If the traffic does not qualify for the ~SP exemption, then the
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only other connection to the PSTN available is a Feature Group connection such
as FGD.
WHAT IS THE FUNDAMENTAL DISPUTE RELATED TO THIS
LANGUAGE?
Qwest and Level 3 are not in agreement regarding intercarrier compensation for
VoIP traffic that does not originate and terminate at physical locations within the
same LCAs. The VoIP compensation issue will be discussed, in more detail in
Issue 3B of my testimony regarding compensation for ISP Traffic. Level 3
apparently does not agree that Qwest has the right to recognize VoIP traffic as
Switched Access in the event of an "operational verification audit failure
because Level 3 takes the position that Switched Access rates should never apply
to VoIP traffic, no matter where it originates or terminates.
DOES QWEST BELIEVE THAT OPERATIONAL AUDITS ARE
NECESSARY?
Absolutely. Qwest believes that audits are necessary to verify the jurisdiction of a
call by ensuring that a VoIP call is properly classified for billing purposes
according to the location of the originating and terminating points of the PSTN
portions of the call. Qwest also believes that audits are necessary to ensure that
calls that are classified as VoIP are properly identified as VoIP calls in compliance
with the FCC's definition of VoIP which is the basis of Qwest's proposed
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definition ofVoIP. Again, as discussed above, Level3's definition ofVoIP does
not conform to the definition provided by the FCC.
DOES LEVEL 3 OFFER ANY OTHER SOLUTION THAT WOULD
ENABLE QWEST TO IDENTIFY VOIP TRAFFIC?
No. While Level 3 does not address audits for VoIP traffic, it does state in its
Petition that approval of Level 3' s proposed definition of "call record" would
allow the Parties to identify and account for the exchange of such traffic in a
relatively easy process. I can only assume that Level 3 believes such call records
are sufficient verification. As Mr. Linse addresses in his testimony, there is no
technical way to identify VoIP today, and reliance on an optional parameter input
by Level 3 is not a solution. Qwest has also found with CL~Cs in the past
through sampling, that even though some call records indicate a local call, the call
in fact has been a toll call, and the records did not indicate that access Gharges
were applicable.
HAVE THE PARTIES AGREED TO AUDIT PROVISIONS ELSEWHERE
IN THIS CONTRACT?
Yes. As a matter of fact, an entire section, Section 18, of the agreement is
devoted to the procedures for auditing "books, records, and other documents used
in providing services under this Agreement. "9 In addition to the provisions of
See Section 18.1 of the agreed to language in the proposed contract.
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Section 18 , the parties have agreed to audit provisions for safety audits IO service
eligibility audits for high capacity combination or commingled facilities, 11
Qwest's loop information 12 and a comprehensive audit of Qwest's use ofCL~C'
Directory Assistance Listings.
HAS LEVEL 3 PROPOSED OTHER AUDIT PROVISIONS?
Yes. In Level 3's proposed Section 7.3., which is covered under Disputed Issue
, Level 3 includes proposed section 7.3.1 for auditing of company factors.
As a matter of principle, and as evidenced by the provisions the parties have
agreed to, Qwest does not oppose the inclusion of audit provisions, and the audit
provision included in disputed issue 18 is not the reason that Qwest opposes Level
s proposed language, as Mr. Easton will explain. It is apparent from Level 3'
proposal and from the agreed upon language elsewhere in this contract Level 3
does not oppose audits in general. But for reasons yet to be explained, Level 3
opposes the audit provision proposed by Qwest in section 7.1 dealing with the
origination and routing of VoIP calls.
See Section 8.10 of the agreed to language in the proposed contract.
See Section 9.10.5 et seq. of the agreed to language in the proposed contract.
See Section 9.8 of the agreed to language in the proposed contract.
See Section 10.2.10.1 of the agreed to language in the proposed contract.
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SHOULD THE COMMISSION ADOPT QWEST'LANGUAGE FOR
SECTION 7.1.1.1?
Yes. To ensure fair and accurate billing for VoIP traffic, the commission should
approve Qwest's proposed language for Section 7.
VI.DISPUTED ISSUE lA: SECTION 7.1.1.2 CERTIFICATION
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO 7.1.1.2
VOIP CERTIFICATION.
The disagreement identified in section 7.2 is similar to 7.1. Level 3' s
Petition is silent on Level 3's opposition to proposed section 7.1.1.2. Qwest'
proposed 7.addresses VoIP certification consistent with the VoIP
configurations as defined in the agreement.Instead of addressing Qwest'
proposed language, Level 3 remains silent on the VoIP certification process and
proposes an entirely new section 7.2 relating to SPOI.
WHAT IS QWEST'S LANGUAGE PROPOSAL THAT RELATES TO
THIS ISSUE?
Qwest's proposal for section 7.2 of the interconnection agreement states:
Prior to using Local Interconnection Service trunks to terminate
VoIP traffic, CL~C certifies that the (a) types of equipment VoIP end users
will use are consistent with the origination of VoIP as defined in this
Agreement; and (b) types of configurations that VoIP end users will use to
originate calls using IP technology are consistent with the VoIP configuration
as defined in this Agreement
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WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR SECTION 7.1.1.2?
As was the case with section 7., this gets a bit confusing. Apparently Level 3
opposes any provision in the contract for certification of VoIP traffic. Therefore
Level 3 offers no changes to Qwest's proposed language and instead seeks to
eliminate it completely. Since Level 3 presumably assumes the Qwest language
will be stricken, Level 3 has used the 'available' number 7.1.1.2 to introduce
additional language dealing with single point of interconnection (SPOI).
testimony will address the Qwest proposed 7.2 dealing with certification of
VoIP traffic and which will require Commission resolution one way or the other.
Mr. ~aston will address the SPOI issue in his testimony.
DOES QWEST BELIEVE THAT CERTIFICATION IS NECESSARY?
Yes. As discussed above, Qwest and Level 3 have a fundamental disagreement
regarding what qualifies as a VoIP call. Level 3 should be willing (and the
Commission should require Level 3) to certify that VoIP traffic that it sends to
Qwest meets the definition established by the FCC.
HAVE THE PARTIES AGREED TO CERTIFICATION LANGUAGE
ELSEWHERE IN THIS CONTRACT?
Yes.There are many certification provisions included in the agreed upon
language in this contract. For example numerous provisions are included in
Section 12 requiring Level 3 to certify that its OSS can properly communicate
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with and submit orders to Qwest's OSS. In addition, Level 3 must certify that it is
entitled to certain high capacity loops or transport UNEs per the Triennial Review
Remand Order; 14 Level 3 must certify that it meets service eligibility criteria for
high capacity ~~Ls; 15 both parties must certify their service management
systems; 16 and Qwest must certify Right of Way ("ROW") agreements to Level
17 Clearly, both parties have agreed to certification obligations elsewhere in this
agreement.
SHOULD THE COMMISSION ADOPT QWEST'PROPOSED
LANGUAGE FOR SECTION 7.1.1.2?
Yes. The Commission should adopt Qwest' s proposed language for section
1.1.2.
VII.DISPUTED ISSUE 3 VNXX TRAFFIC
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE 3.
Level 3 listed three separate issues under Issue 3 denominated as Issues 3a, 3b
and 3c.Issue 3a concerns section 7.3.2 of the agreement and involves
intercarrier compensation . for calls not physically originating and terminating
See Section 9.1.4 of the agreed to language in the proposed contract.
See Section 9.10 et. seq. of the agreed to language in the proposed contract.
See Section 10.2.3 et. seq. of the agreed to language in the proposed contract.
See Section 10.26 et. seq. of the agreed to language in the proposed contract.
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within the same LCA. Issue 3b relates to section IV of the agreement's definition
of Virtual NXX or "VNXX traffic.Finally, Issue 3c addresses whether
intercarrier compensation is required on VNXX traffic in section 7.3.
WHAT IS THE DISPUTE REGARDING ISSUE 3B AND THE
DEFINITION OF VNXX?
Issue 3b involves the definition of VNXX traffic. Although not in the order
presented in the Level 3 Petition and matrix, a discussion of the definition of
VNXX traffic is necessary in order to understand the core principles of the
disputed issues. Understanding the VNXX concept and the types of traffic that
should be classified as VNXX is crucial to an understanding of the parties
differences over VNXX issues. An understanding of the definitional differences
between the parties is a necessary prerequisite to the later discussion of
compensation for local traffic.
WHAT IS VNXX TRAFFIC?
In short, VNXX is an arrangement that provides the functionality of toll or 8XX
service, but at no extra charge. An NXX code, commonly referred to as a prefix
is the second set of three digits of a ten-digit telephone number (NPA-NXX-
XXXX). These three digits (NXX) are assigned to and indicate a specific central
office from which a particular customer is physically served. In other words, in
the number (208) 344- XXXX, the "344" prefix is assigned to a specific central
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office in the (208) area code and thus identifies the general geographic area in
which the customer is located. A "virtual" NXX, or VNXX undercuts that
concept because it results in a carrier-assigned NXX associated with a particular
central office, but where the carrier has no customers physically located. Instead
these telephone numbers are assigned to a customer physically located outside the
LCA of the central office associated with the particular NXX. With VNXX, the
physical location of the CL~C customer is in most cases in a LCA that would
require a toll call from the LCA with which the telephone number is associated.
This scheme requires the assignment of a "virtual" NXX. The NXX is labeled
virtual" because it is an assigned number that tells callers that it is in the calling
party LCA, rather than the called party s LCA. In other words, a call to the
virtual" NXX does not result in a local call within the LCA that the VNXX
number appears to be assigned; but in reality the call is terminated in a different
LCA, and perhaps even in a different state. Qwest ~xhibit No. 303 attached
hereto demonstrates visually how VNXX circumvents the proper numbering plan.
VNXX has become an issue because CLECs, like Level 3 in Idaho, obtain local
numbers from the North American Numbering Plan Administrator ("NANP A") in
various parts of a state that are actually assigned to its customers (i.ISPs) with
no physical presence whatsoever in the LCA with which the local numbers are
associated; thus, the traffic directed to those numbers is, instead of being routed to
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customer in the same LCA as the calling party, routed to one of the points of
interconnection ("POls ) of the CLEC and is then terminated with the CL~C'
ISP customer at a physical location in another LCA or even in another state.
IS THE VNXX ISSUE CONNECTED TO THE SINGLE POINT OF
INTERCONNECTION (SPOI) ISSUE?
Yes. In the early 2000s CL~Cs argued that they should be entitled to serve a
LATA from a single switch rather than placing switches in numerous LCAs in
order to offer local service. Qwest agreed and has offered such a form of
interconnection (SPOI) for several years. If a CL~C provides local service from a
single switch within a LATA, it is entitled (because it is a CL~C) to be assigned
NXXs for LCAs both near and far from the switch. The manner in which those
NXXs are used is a critical matter. If a CL~C is assigned an NXX and it has
constructed or leases loops to retail subscribers located within the LCA of the
NXX, that is consistent with the intended use of the assigned NXX (i., to allow
the CLEC to provide local exchange service to customers located within that
LCA). But if a CL~C is assigned an NXX from a distant LCA and it creates a
primary line of business that creates a deliberate misimpression that, from a
carrier-to-carrier perspective, toll free calling is really conventional local calling,
then that is an unintended and inappropriate use of the assigned NXX.
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WHAT IS QWEST'S PROPOSAL FOR ISSUE 3B, DEFINITION FOR
VNXX TRAFFI C?
Qwest proposes the following definition ofVNXX Traffic:
VNXX Traffic" is all traffic originated by the Qwest ~nd User Customer that
is not terminated to CL~C's ~nd User Customer physically located within the
same Qwest Local Calling Area as the originating caller, regardless of the
NP A-NXX dialed and, specifically, regardless of whether CL~C's ~nd User
Customer is assigned an NPA-NXX associated with a rate center in which the
Qwest ~nd User Customer is physically located.
WHAT IS LEVEL 3'S PROPOSAL FOR ISSUE 3B, DEFINITION FOR
VNXX TRAFFIC?
Level3's proposes 3 paragraphs for the definition ofVNXX traffic:
VNXX Traffic shall include the following:
ISP-bound VNXX traffic is telecommunications over which the FCC has
exercised exclusive jurisdiction under Section 201 of the Act and to which
traffic a compensation rate of $0.0007 / MOU applies. ISP-bound VNXX
traffic uses geographically independent telephone numbers ("GITN"), and thus
the telephone numbers associated with the calling and called parties mayor
may not bear NP A-NXX codes associated with the physical location of either
party. This traffic typically originates on the PSTN and terminates to the
Internet via an Internet Service Provider ("ISP"
V oIP VNXX traffic is telecommunications over which the FCC has exercised
exclusive jurisdiction under Section 201 of the Act and to which traffic a
compensation rate of $0.0007 / MOU applies. VoIP VNXX traffic uses
geographically independent telephone numbers ("GITN"), and thus the
telephone numbers associated with the calling and called parties mayor may
Because of recently enacted Idaho legislation, Qwest is removing this parenthetical
from its proposed language.
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not bear NP A-NXX codes associated with the physical location of either party.
Because VoIP VNXX traffic originates on the Internet, the physical location
of the calling and called parties can change at any time. For example, VoIP
VNXX traffic presents billing situations where the (i) caller and called parties
are physically located in the same IL~C retail (for purposes of offering circuit
switched "local telephone service ) local calling area and the NP A-NXX
codes associated with each party are associated with different IL~C LCAs; (H)
caller and called parties are physically located in the same IL~C retail (for
purposes of offering circuit switched "local telephone service ) local calling
area and the NPA-NXX codes associated with each party are associated with
the same IL~C LCAs; (Hi) caller and called parties are physically located in
the different IL~C retail (for purposes of offering circuit switched "local
telephone service ) local calling area and the NP A - NXX codes associated
with each party are associated with same L~C LCAs; and (iv) caller and called
parties are physically located in the different IL~C retail (for purposes of
offering circuit switched "local telephone service ) local calling area and the
NP A-NXX codes associated with each party are associated with different
IL~C LCAs. ~xamples of VoIP VNXX traffic include the Qwest "One Flex
service and Level 3' s (3) V oIP ~nhanced Local service.
Circuit Switched VNXX traffic is traditional "telecommunications services
associated with legacy circuit switched telecommunications providers, most of
which built their networks under monopoly regulatory structures that evolved
around the turn of the last century. Under this scenario, costs are apportioned
according to the belief that bandwidth is scarce and transport expensive. The
ILEC offers to a customer the ability to obtain a "local" service by paying for
dedicated transport between the physical location of the customer and the
physical location of the NPA-NXX. Thus, this term entirely describes a
service offered by IL~Cs, but which cannot be offered by IP-based
competitors as such networks do not dedicate facilities on an end-to-end basis.
WHAT THE BASIC DIFFERENCE BETWEEN THE TWO
COMPANIES' DEFINITIONS OF VNXX?
Both sides agree that a VNXX call originates in one LCA and terminates in
another. In addition, both Level 3 and Qwest agree that, with VNXX, the physical
location of the end user customer who is being called bears no relationship to the
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local number that is assigned to the call. For example, Qwest's definition defines
VNXX traffic as "traffic.. .that is not terminated to CL~C's ~nd User Customer
physically located within the same Qwest LCA .... as the originating caller
regardless of the NP A-NXX dialed.Level 3's definition states that "VNXX
traffic uses geographically independent telephone numbers ("GITN"), and thus the
telephone numbers associated with the calling and called parties mayor may not
bear NP A-NXX codes associated with the physical location of either party.
What the parties do not agree on is the means of compensation or appropriate
trunking for VNXX traffic. 'For instance, Level 3 adds "compensation" language
into the definition on the assumption that reciprocal compensation applies to
VNXX traffic, attempting to set the compensation rate19 for a call originating in
one LCA and terminating in a different one. Thus, as noted above, under Level
s proposal, instead of Qwest recovering the cost of delivering the traffic, Qwest
would pay Level 3 a compensation rate to terminate the traffic. In other words
Level 3 proposes a fundamental change in intercarrier compensation for VNXX
traffic.
Level 3' s language is improper for several reasons. First, because this section is
for defining what VNXX traffic is and not its rates, and second, and of critical
If the Commission were to adopt Level 3' s proposed definition, it would then mandate
reciprocal compensation payments at the local ISP rate of $.0007 and would
completely eliminate the concept of a toll call with regard to this traffic.
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importance, Level 3' s proposed definition of VNXX would convert toll calls to
local calls, and change the LCAs. For example, Level3's language would enable
a customer physically located in the Boise LCA to have a Twin Falls telephone
number, so that calls to and from that person by local subscribers in Twin Falls
would be treated as local calls even though they are routed over the PSTN to
Boise just like other toll calls. This is improper because, among other reasons
Level 3 wants to shift all of the costs of this arrangement to Qwest.
LEVEL 3'S DEFINITION CONTAINS THREE CATEGORIES OF VNXX
TRAFFIC. DO YOU AGREE WITH "CATEGORIES" IN REGARD TO
VNXX CALLS?
No. The ISP and VoIP paragraphs ofLevel3's definition are essentially the same
for both categories. For example, both sections state that "VNXX traffic uses
geographically independent telephone numbers.. .not associated with the physical
location of either party.
. .
" In the V oIP section above, I stated that it appears that
Level 3 wants to treat all VoIP traffic as if it were local and it is through this
definition that it attempts to do so. Both the ISP and VoIP sections attempt to
impose "the compensation rate of $0.0007/MOU" on this interexchange traffic.
The only actual difference between the paragraphs is the claim that an ISP VNXX
call originates on the PSTN and terminates to an ISP while VoIP VNXX calls
originate on the Internet and terminate to an end customer on the PSTN. These
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comments, however, do not change the actual definition of what constitutes
VNXX traffic. The categories (ISP or VoIP) are irrelevant to establishing the
VNXX definition which deals with the geographic location of customers and
NXX numbers.
Level 3's third category is both unnecessary and out of place in this section.
Labeled "Circuit Switched VNXX traffic " the alleged definition contains only
Level 3'biased legal opinion regarding "traditional 'telecommunications
services. ", The language does not add any substance to the definition of VNXX
traffic and is obviously extraneous to the subject matter of this section of the
contract.
On the whole, Level 3 is attempting to create distinctions where none exist in
order to avoid the existing intercarrier compensation mechanisms-in effect to
avoid costs that other carriers pay and replace them with revenues. All three
proposed categories of VNXX are based on the termination of a call being
physically located in a different LCA. The labeled distinctions are irrelevant to
the definition of VNXX and only confuse the language and the underlying issues.
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IF A VNXX CALL IS PLACED TO AN ISP OR TO A PSTN END USER
CUSTOMER AS A VOIP TERMINATION, DOES THE CALL
CLASSIFI CA TI 0 N CHANGE TO A LOCAL CALL?
The type of business of an end user customer does not affect whether a call is
local or not. If an end user customer is located in Twin Falls (whose ISP'
modems and routers are physically located in Boise, but whose number is a Twin
Falls NPA NXX) logs onto the Internet, the call to the ISP telephone number is
not a local call because it originates in Twin Falls and terminates in Phoenix.2O It
makes no difference if the call is to an ISP, a hardware store, or a restaurant in
Boise, because it is a call that originates in Twin Falls and terminates in Boise.
The location of the calling and called parties determines the nature of the call, not
the business type. A toll call is a toll call. Level 3' s avoidance of that fact is
demonstrated by its creation of VNXX categories. ISP, VoIP or circuit based
VNXX calls do not change a toll call into a local call. This language does not
belong in the contract anywhere, including in the definition of VNXX.
Twin Falls is in a different LCA than Boise.
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IF ISP TRAFFIC AND VOICE TRAFFIC ARE TREATED THE SAME
FOR THE VNXX DEFINITION, HOW IS A CALL DETERMINED TO BE
LOCAL OR TOLL?
In regard to defining VNXX traffic, ISP traffic should be treated no differently
than voice traffic. In determining if a call is local or toll, the location of the
origination and termination is the decisive factor: calls that physically originate
and terminate within the same LCA are rated as local calls. The ~SP POP is the
point of termination (for an ISP) and origination (for terminating VoIP). Calls
routed to a point of interface for termination outside of the originating LCA are
interexchange calls. VNXX services that terminate traffic to an ISP whose
Internet equipment (e., modems, servers, and routers) is not located within the
same LCA as the originating LCA are simply interexchange toll calls and must
remain subject to the access charge provisions that govern interexchange toll
traffic. In the case of VoIP calls, where a VoIP Provider s point of presence is in
one LCA, say Boise, and the VoIP Provider s CL~C, for example Level 3 , wants
to deliver a call on behalf of its end user customer (the VoIP Provider) to an end
user customer in Twin Falls, Level 3 should hand that call to an "intraLATA" toll
provider for termination. Level 3' s definitional language attempts to say this is a
toll call or not depending on to whom the call is placed. Again, a toll call is a toll
call. Qwest's definition of VNXX traffic is clear, concise, and accurate, while
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Level 3' s definition unnecessarily complicates the issue.Qwest's language
should be adopted.
IN ITS PETITION LEVEL 3 REFERS TO ITS VNXX PRODUCT AS AN
FX LIKE" PRODUCT. IS VNXX LIKE FOREIGN EXCHANGE (FX)
SERVICE?
No. Level 3's VNXX product uses the PSTN to route and terminate calls to end
user customers connected to the PSTN in another LCA. In all respects, except the
number assignment, the call is routed and terminated as any other toll call.
Qwest's FX product, on the other hand, delivers the FX calls within the LCA
where the number is actually associated. In other words, a Qwest FX customer
actually purchases a local service connection in the LCA associated with the
telephone number. That local service connection is purchased by the FX customer
out of the local exchange services catalog that apply to that LCA. The calls are
then transported on what is, in effect, the end user customer s private network
(private line) to another location. In other words, after purchasing the local
connection in the LCA, the FX customer bears full financial responsibility to
transport it to the location where the call is actually answered. Qwest, and other
telephone companies, have been selling such private line services to PBX owners
and other customers for decades. Calls are delivered to the customer s PBX and
any call delivery behind the PBX is, for purposes of transport to the customer
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actual location, carried on the owner s private network.Qwest and other
telephone companies delivered the call to the PBX location. Private transport
beyond that is the business of and financial responsibility of the PBX owner.
Level 3' s approach is fundamentally distinct from FX service. Under FX, the
customer who desires a presence in another LCA is fully responsible to transport
the traffic to the location where it wants the call answered. Under level 3'
proposal, Level 3 wants the call routed over the PSTN, but feels no responsibility
for providing the transport to the distant location. In calling its product an FX-
like product, Level 3 attempts to confuse this critical distinction. Calls over the
public switched network between communities that use the toll network are toll
calls no matter how the numbers are assigned. Calls delivered to end user
customers within a LCA and transported over private networks are more than a
mere technical distinction. It is consistent with the way Commissions have been
distinguishing between toll and local calls since access charges were established.
ISSUE 3A RECIPROCAL COMPENSATION FOR VNXX
PLEASE DESCRIBE ISSUE 3A AND WHAT THE PARTIES DISPUTE IN
THIS ISSUE.
Now that the distinction between a local call and VNXX has been established
Issue 3a can be addressed. Qwest's position is clear. VNXX calls are not local
calls subject to reciprocal compensation payments under section 251(b)(5).
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Qwest's proposed language makes clear that Qwest will not treat VNXX calls as
local and will not pay local reciprocal compensation on such VNXX traffic. Level
3 attempts to cast this issue as to whether Qwest may exclude ISP traffic from
compensation due under the FCC'ISP Remand Order through contract terms
that identify geographic designations based on LCAs. A call from a customer in
Boise to a customer located in Miami, Florida is a toll call, irregardless of the
telephone number dialed. The fact that the customer at the other end of that toll
call is an ISP does not magically change the call into a local call. And a VNXX
call to an ISP physically located in Boise, but with a Twin Falls NP A NXX
placed by an end user customer in Twin Falls is not a local call either. However
Qwest also makes clear that Qwest will pay reciprocal compensation, a charge for
terminating local traffic, on traffic that actually originates and terminates at
physical locations within the same LCA. Qwest also makes clear that calls that
originate and terminate at locations in different LCAs are not local calls and not
entitled to reciprocal compensation. The "VNXX" number is not and should not
be determinative. And, of course, as stated earlier, if the VNXX call is an ISP
call, no reciprocal compensation is due, just as it would not be due on a typical
voice call. The fact that the call is ISP grants it no special status, legal or
otherwise.
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WHAT IS QWEST'S LANGUAGE PROPOSAL FOR ISSUE 3A, SECTION
Qwest's proposal for Section 7.3.6.3 of the interconnection agreement states:
7.3.6.3 Qwest will not pay reciprocal compensation on VNXX traffic.
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR SECTION 7.
Level3's counter-proposal for Section 7.3.6.3 is set forth:
7.3.6.3 IfCL~C designates different rating and routing points such that
traffic that originates in one rate center terminates to a routing point
designated by CL~C in a rate center that is not local to the calling party even
though the called NXX is local to the calling party, such traffic ("Virtual
oreign ~xchange" traffic) shall be rated in reference to the rate centers
associated with the NXX prefixes of the calling and called parties ' numbers
and treated as 251 (b)( 5) traffic for purposes of compensation.
LEVEL 3 STATES THAT QWEST IS PROPOSING TO EXCLUDE ISP
TRAFFIC FROM COMPENSATION DUE IT UNDER THE FCC'S ISP
REMAND ORDER. DO YOU AGREE?
No. First, Qwest agrees that, under the ISP Remand Order and until addressed
more definitively by the FCC, reciprocal compensation is due on ISP calls that
originate and terminate to locations within a LCA. However, the FCC has not
ruled that all ISP traffic is subject to intercarrier compensation. Level 3'
fundamental argument is that the ISP Remand Order read in combination with
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the Core Forbearance Order,21 requires that intercarrier compensation must be
paid on all ISP traffic, including VNXX ISP traffic.22 Level 3 argues that traffic
bound for an' ISP located in Boise is subject to intercarrier compensation
regardless of whether it originated across town in the LCA, from the other end of
the state, or from across the country. However, there is nothing in the ISP
Remand Order or Core Forbearance Order that requires that state commissions
adopt ICA language that allows intercarrier compensation for VNXX ISP traffic.
These orders relate only to local ISP traffic, where the ISP is physically located in
the same LCA as the customer placing the call. Qwest addresses its legal position
on this issue in its Response to Level 3' s Petition and will do in more detail in its
briefs in this case.
DOES LEVEL 3 ALSO CONFUSE THE ISSUE OF ISP TRAFFIC WITH
VNXX ISSUES?
Yes. VNXX is not just a phenomenon associated with ISP calls, although it is in
that context that VNXX issues often arise. A VNXX call can be to an ISP such as
AOL located in another town or to a voice customer such as the local hardware
store in that other town. VNXX arrangements can exist for both ISP and voice
Order Petition of Core Communications for Forbearance Under 47 USC 160(c)
from the Application of the ISP Remand Order Order FCC 04-241 WC Docket No.
03-171 (reI. October 18 2004) Core Forbearance Order
Level 3 Petition ~~ 56-66.
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traffic. The issue ofVNXX traffic (whether ISP or other types of traffic) has been
addressed to some degree by the FCC and has been extensively litigated before
many state commissions. The majority of state commissions have ruled that
traffic, whether voice traffic or ISP that does not physically originate and
terminate in the same LCA is not subj ect to reciprocal compensation under
existing interconnection agreements.Here, however, the issue is not the
interpretation of an existing interconnection agreement, but what the language of a
new agreement should provide. In this case, Level 3 is asking the Commission to
require local reciprocal compensation for non-local calls, deviating from the
policy that reciprocal compensation is recoverable only for the termination of
local" traffic (as defined by Idaho statute). In that regard, language from the ISP
Remand Order is instructive:
Congress preserved the pre-Act regulatory treatment of all the access services
enumerated under Section 251(g). These services thus remain subject
Commission jurisdiction under Section 201 (or, to the extent they are
intrastate services, they remain subject to the jurisdiction of state
commissions), whether those obligations implicate pricing policies as in
Comptel or reciprocal compensation. This analysis properly applies to the
access services that incumbent LECs provide (either individually or jointly
with other local carriers) to connect subscribers with ISPs for Internet-bound
traffic.
The FCC was focused upon problems unique to the compensation mechanism that
applied to traffic where the ISP was located in the same LCA. Level 3 attempts to
ISP Remand Order ~ 39 (emphasis added, footnote omitted).
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inject language that "ISP-bound" VNXX traffic is subject to ISP compensation
and argues that the FCC changed the access charge structure and issued an
exemption for "all" calls sent to the Internet, regardless of where the call
originates and terminates. While the FCC has opened a docket to scrutinize these
issues as a part of an overall examination of intercarrier compensation, 24 the
applicable law has not changed.Until the FCC takes further action in its
intercarrier compensation docket, expanding reciprocal compensation to include
calls from across the state or country must not be permitted.
LEVEL 3 ARGUES THAT THERE IS NOT A COST DIFFERENCE
TERMINATING ISP AND NON ISP CALLS. PLEASE RESPOND.
Level 3 argues that its cost to terminate an ISP call is not different than the cost to
terminate a non ISP call. Qwest has never suggested that there is a cost difference
to Level 3 and, whether there is or is not a difference, the question is completely
irrelevant. The question before the Commission is not the cost of termination, but
whether a CLEC, by serving ISPs, may gather traffic from multiple LCAs at no
cost to itself (remember that Level 3 also claims it should pay no costs on Qwest'
side of the POI) and then be able to charge Qwest for terminating all of that
traffic, whether it is local or not. As many other state commissions that have
addressed the issue have concluded and as the FCC clearly concluded in the ISP
In the Matter of Developing a Unified Intercarrier Compensation Regime 16 FCC
Rcd 9610 (2001) Intercarrier Compensation NP RM'
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Remand Order requITIng reciprocal compensation on ISP traffic leads to
uneconomic arbitrage and windfall revenues.
WHY SHOULD QWEST'S LANGUAGE BE ADOPTED?
Reciprocal compensation as used in the Act is the charge to terminate "local"
traffic. Under Qwest's definition, VNXX traffic (the issue discussed in 3b above)
is traffic that originates and terminates at physical locations that are not within the
same LCA. ~ven Level 3' s definition of VNXX recognized that the call would
originate in one LCA and terminate in another LCA. While acknowledging the
true nature ofVNXX calls, Level3's proposal attempts to produce a major change
in compensation policy by requesting that the Commission nevertheless eliminate
access charges on such traffic and require the payment of compensation for
terminating the traffic. Such a dramatic change in policy should not be approved
by the Commission.
WHY DOES QWEST BELIEVE ITS LANGUAGE SHOULD BE
ADOPTED?
Carriers seeking to receIve reciprocal compensation on VNXX servIces are
attempting to redefine existing toll services and local boundaries and categorize
them in a unique way in an attempt to collect reciprocal compensation and avoid
access charges. These VNXX numbers, and the facilities that would be used to
connect to locations where such calls would be terminated, are interexchange in
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nature and are therefore not subj ect to reciprocal compensation. By attempting to
fool the systems with a local number, the call detail itself would not indicate that
any compensation associated with this interexchange or toll call should be made.
The assignment of telephone numbers in the VNXX manner should not result in
inter-exchange calls between two communities not in the same LCA to
masquerade as local calls.
WHAT IS THE APPROPRIATE COMPENSATION MECHANISM FOR
THESE TYPES OF CALLS?
The costs of carrying VNXX calls between different LCAs should not be borne by
end user customers of the local exchange where the call originated. The VNXX
service providers, and the ultimate cost-causer, the ISP whose customers generate
the traffic via dial-up Internet connections, should bear the financial responsibility
for such traffic. After all, it is the CL~C and its ISP customers who generate the
traffic. The telecommunications carrier who wishes to deliver this interexchange
traffic elsewhere must bear the financial responsibility of the interexchange
transport to the ISP.The appropriate compensation mechanism for VNXX
services is that the VNXX service provider that is transporting traffic between
LCAs should pay the appropriate charges to transport calls between the LCAs.
Such calls should not be considered local calls.
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ISSUE 3C: RECIPROCAL COMPENSATION FOR ISP TRAFFIC
WHAT IS THE DISPUTE BETWEEN THE PARTIES IN ISSUE 3C?
In Issue 3b the definition of VNXX traffic was discussed. Issue 3a dealt with
Level 3' s claim that VNXX traffic should be subj ect to reciprocal compensation.
There was no distinction made by Level 3 between a voice call and an ISP call;
Level 3' s language tries to include VNXX in the category of calls entitled to
reciprocal compensation. Qwest's proposed language made clear that VNXX
traffic was not local traffic subject to reciprocal compensation. Now in Issue 3c
the language addresses the payment of reciprocal compensation for ISP traffic
generally.
WHAT IS QWEST'S LANGUAGE PROPOSAL FOR ISSUE 3C, SECTION
1, INTERCARRIER COMPENSATION FOR ISP BOUND TRAFFIC?
Qwest proposal for the definition of Section 7.3.1 is as follows:
7.3.6.1 Subject to the terms of this Section, intercarrier compensation for
ISP-bound traffic exchanged between Qwest and CL~C (where the end users
are physically located within the same Local Calling Area) will be billed as
follows, without limitation as to the number ofMOU ("minutes of use ) or
whether the MOU are generated in "new markets" as that term has been
defined by the FCC:
0007 per MOU or the state ordered rate, whichever is lower.
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WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR ISSUE 3C,
SECTION 7.1, INTERCARRIER COMPENSATION FOR VNXX
TRAFFIC?
Level3's counter-proposal for the definition of Section 7.3.6.1 is as follows:
7.3.1 Intercarrier compensation for ISP-bound traffic Section 251(b)(5)
traffic, and VoIP traffic exchanged between Qwest and CL~C will be billed
and paid without limitation as to the number of MOU ("minutes of use ) or
whether the MOU are generated in "new markets" as that term has been
defined by the FCC in the ISP Remand Order at a rate of $.0007 per MOU.
WHY DOES QUEST OBJECT TO LEVEL 3'S PROPOSED LANGUAGE
IN 7.
Qwest's major objection to Level 3's language stems from the fact that Level 3
has inserted additional types of traffic into the paragraph for which it wants to
receive reciprocal compensation at the rate of $.0007. The two additional types of
traffic are the imprecise reference to "section 251 (b )( 5) traffic" as well as "VoIP
traffic." As I explain below, by proposing this definition, Level 3 is attempting, in
effect, to obtain a decision from the Idaho Commission that access rates do not
apply to any Level 3 traffic in Idaho.
HOW IS LEVEL 3 ATTEMPTING TO ELIMINATE ACCESS CHARGES
IN IDAHO?
In a very roundabout, but very clever way. Level 3 proposes language saying the
rate of $.0007 shall apply to "251(b)(5) traffic." To find out what this means, one
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must go to the definitions section of Level 3's proposed agreement to see how it
defines "251 (b )( 5) traffic.It does this in its definition of the term
telecommunications " which, under Level 3's definition includes but is not
limited to Section 251 (b) (5) Traffic, which is defined as Telephone ~xchange
Service, ~xchange Access Service, Information Service and Telephone Toll
Service (including but not limited to IntraLATA and InterLATA Toll) traffic and is
also defined to include ISP-Bound traffic, VoIP traffic.Thus, while including
ISP-bound traffic and V oIP " Level 3 also includes toll traffic in section
251(b)(5) traffic. As far as I know, it is unprecedented for a CL~C to claim that
toll traffic is subject to reciprocal compensation. The effect of all of this is that
under Level3's language, toll would be subject to reciprocal compensation and no
longer subj ect to terminating access charges. I address this in more detail in
Issue X Definition of Interconnection.' Level 3 apparently believes that access
charges should not apply to its traffic, even for calls outside the LCA. Thus it has
attempted in several places to insert language into the agreement that would
completely exempt Level 3 from those charges. These are not just minor tweaks
to contract language that are of little consequence; rather, it represents a dramatic
change in intercarrier compensation from the mechanisms that govern the
relationships between carriers.
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VIII. DISPUTED ISSUE 4: COMPENSATION FOR VOICE AND VOIP
TRAFFI C
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE 4.
At its core, this is also a dispute over VNXX calls. Qwest agrees to pay reciprocal
compensation on local VoIP calls where the end user customers are physically
located in the same LCA, but not if they are located in different LCAs. While the
disputed language in section 7.3.6 dealt with ISP traffic, the language in dispute in
this issue, section 7.3.4, deals with the exchange of local voice and VoIP traffic.
In this issue, section 7.3.4 deals with the exchange of local voice and VoIP traffic.
Again, VNXX is the central issue because Level 3 proposes in its language that
the compensation for local voice and VoIP calls also apply as long as the NXX
codes are associated with the same LCA, with no requirement that the end user
customers actually be physically located within the same LCA. The Level 3
language simply attempts to have the Commission amend its access rules and
impose reciprocal compensation for VNXX calls that are from outside the LCA.
WHAT IS QWEST'S LANGUAGE PROPOSAL FOR SECTION 7.
Qwest's proposal for Section 7.3.4.1 is set forth below:
7.3 .4.Intercarrier compensation for ~xchange Service (~AS/Local) and
VoIP traffic exchanged between CL~C and Qwest (where the end users are
physically located within the same Local Calling Area) will be billed at
001343 per MOD.
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7.3 .4.The Parties will not pay reciprocal compensation on traffic
including traffic that a Party may claim is ISP-Bound Traffic, when the traffic
does not originate and terminate within the same Qwest local calling area (as
approved by the state Commission), regardless of the calling and called NP A-
NXXs and, specifically regardless of whether an ~nd User Customer is
assigned an NPA-NXX associated with a rate center different from the rate
center where the customer is physically located (a/k/a "VNXX Traffic
Qwest's agreement to the terms in this paragraph is without waiver or
prejudice to Qwest's position that it has never agreed to exchange VNXX
Traffic with CL~C.
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR SECTION 7.
Level 3' s proposal for Section 7.3 .4.1 is set forth:
7.3 .4.Subj ect to the terms of this Section, intercarrier compensation for
Section 251(b)(5) Traffic where originating and terminating NPA-NXX codes
correspond to rate centers located within Qwest defined local calling areas
(including ISP-bound and VoIP Traffic) exchanged between Qwest and CLEC
will be billed as follows, without limitation as to the number ofMOU
minutes of use ) or whether the MOU are generated in "new markets" as
that term has been defined by the FCC: $.0007 per MOD.
IS THERE ALSO A DISPUTE ABOUT THE RATE THAT IS PAID?
Yes. The Qwest proposed rate in my testimony reflects the rate of $.001343 per
MOU established by the Commission for voice traffic. The FCC did nothing to
take away the state commissions' right to set the voice rate for reciprocal
compensation. Level 3 thinks a different rate
, $.
0007, should apply and not the
rate established by the Idaho Commission. In addition, Level 3 again tries to
insert 251 (b)( 5) language, which, based on the discussion above, includes toll, and
would eliminate access charges on toll calls. Level 3 also attempts to include any
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IX.
VNXX calls by tying the traffic to the NP A - NXX, and not to the towns where the
customers reside.
WHY SHOULD THE COMMISSION ADOPT THE QWEST LANGUAGE
OVER THE LEVEL 3 LANGUAGE?
I will not repeat' the arguments on this issue. I addressed them in the VNXX
definition section, as well as the compensation for ISP issue. In both instances
Level 3 sought to expand the definition of 251 (b)( 5) traffic to include calls from
outside the LCA if the terminating party had an assigned NXX associated with the
local exchange of the calling party. Level 3 is attempting through its language in
7.3.4.1 to do the same thing for voice and VoIP calls. Qwest's language makes
clear that VNXX traffic, including voice and VoIP VNXX traffic, is not local and
is not subject to reciprocal compensation rules for local traffic. Level 3's attempt
to change the FCC's orders and redefine 251(b)(5) to include toll calls is also
addressed in Issues 10 and 19.
DISPUTED ISSUE 19: ISP BOUND 3:1 RATIO, SECTION 7.
WHAT IS THE DISPUTED LANGUAGE FOR SECTION 7.
The portions of Section 7.3.2 that are in dispute are depicted as follows:
7.3.2 Identification ofISP-Bound Traffic -Qwest will presume traffic
delivered to CL~C that exceeds a 3: 1 ratio of terminating (Qwest to CLEC)
to originating (CL~C to Qwest) traffic is ISP- Bound traffic. ~ither party
may rebut this presumption by demonstrating the factual ratio to the state
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Commission. Traffic exchan1!ed that is not ISP-Bound Traffic will be
considered to be Section 251~ traffic.
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO THE
LANGUAGE IN SECTION 7.
There are two issues in regard to Section 7.3.2. In the first instance Level 3
seeks to strike language dealing with the situation where a State Commission has
previously ruled on what is an appropriate method of tracking ISP-bound Traffic.
I show this disputed language in. The second issue deals with Level 3' s attempt
to insert additional language in the section dealing with 3: 1 that will presume all
traffic exchanged between Qwest and Level 3 that is not ISP-bound traffic is
section 251 (b)( 5) traffic. I show this proposed Level 3 change in underlined text.
I will address each of these issues separately.
WHY DID QWEST INCLUDE THE LANGUAGE IN THE FIRST PART
OF SECTION 7.2 THAT LEVEL 3 WANTS STRICKEN?
The language at issue unless the Commission has previously ruled that Qwest
method for tracking ISP-Bound Traffic is sufficient is language proposed by
Qwest for all states.Qwest's proposed language simply provides that if
commission has previously ruled that Qwest's method of identifying actual ISP-
bound traffic is sufficient, then that method of identifying actual local and ISP
minutes should be employed instead of the presumption formula. The FCC gave
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this right to both parties as part of the decision in the ISP Remand Order
establishing the 3: 1 ratio.
A carrier may rebut the presumption, for example, by demonstrating to the
appropriate state commission that traffic above the 3: 1 ratio is in fact local
traffic delivered to non-ISP customers. In that case
, ,
the state commission will
order payment of the state-approved or state-arbitrated reciprocal compensation
rates for that traffic. Conversely, if a carrier can demonstrate to the state
commission that traffic it delivers to another carrier is ISP-bound traffic, even
though it does not exceed the 3: 1 ratio, the state commission will relieve the
originating carrier of reciprocal compensation payments for that traffic, which
is subj ect instead to the compensation regime set forth in this Order . 2S
Qwest has brought this issue up elsewhere and has successfully rebutted the 3:
presumption. Because Level 3 does not object to the language "~ither party may
rebut this presumption by demonstrating the factual ratio to the state
Commission , Qwest has no objection to the language 'being struck.
WHY DOES QWEST OBJECT TO LEVEL 3'S INSERTION OF
LANGUAGE AT THE END OF SECTION 7.
This is simply another manifestation of Level 3' s roundabout effort to reclassify
all of its traffic and eliminate access charges. By making what at first blush is a
seemingly harmless insertion (Traffic exchaneed that is not ISP-Bound
Traffic will be considered to be Section 251 ~ traffic'l ),2 Level 3 is in fact
attempting to classify all traffic exchanged between the two companies as local
traffic subj ect to reciprocal compensation.As I discussed previously, this
ISP Remand Order ~ 79.
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sentence must be read side by side with Level 3's definition of section 251(b)(5)
traffic, in which Level 3 attempts to even include toll traffic. Level 3' s language
would have the effect of eliminating the interstate and intrastate access structures
established by the FCC and Idaho Commission and should be rejected as
inconsistent with both the law and good policy. The FCC made clear that all
traffic is not subject to 251(b)(5):
We conclude that a reasonable reading of the statute is that Congress
intended to exclude the traffic listed in subsection (g) from the reciprocal
compensation requirements of subsection (b )(5). Thus, the statute does not
mandate reciprocal compensation for "exchange access, information access
and exchange services for such access" provided to IXCs and information
service providers."26
HOW SHOULD THE COMMISSION RULE ON ISSUE 19?
The Commission should rule that Level 3' s attempt to change existing law on
what is included in section 251 (b )( 5) traffic should be denied. Thus, the Level 3
proposed language at the end of7.3.2 should be rejected.
DISPUTED ISSUE 10: DEFINITION OF INTERCONNECTION
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
10.
Level 3 mischaracterizes this issue as Qwest's attempt to exclude traffic from
being exchanged. That is not the issue at all. In fact, this is simply another
ISP Remand Order ~ 34.
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version of Level 3' s inappropriate effort to reclassify all traffic to its benefit.
Level 3 purports to be offering a definition of interconnection, but it is really
attempting to insert into the agreement an incredibly broad definition of section
251(b)(5 traffic: Telecommunications includes, but is not limited to Section
251(b)(5) Traffic, which is defined as Telephone Exchange Service, Exchange
Access Service, Information Service, and Telephone Toll Service (including but
not limited to IntraLATA and InterLATA Toll) traffic and is also defined to
include ISP-Bound traffic, VoIP traffic.This language is a clear misstatement
of the FCC's position. Level 3 is seeking to expand the definition of section
251 (b )( 5) traffic to include, among other things, intraLA T A and interLA T A toll
calls. In fact, the FCC has clearly and unequivocally stated that section 251 (b )( 5)
does NOT include the services Level 3 is attempting to add in its definition of
interconnection
" :
We conclude that a reasonable reading of the statute is that Congress
intended to exclude the traffic listed in subsection (g) from the reciprocal
compensation requirements of subsection (b)( 5). ,Thus, the statute does not
mandate reciprocal compensation for "exchange access, information access
and exchange services for such access" provided to IXCs and information
service providers. Because we interpret subsection (g) as a carve-out
provision, the focus of our inquiry is on the universe of traffic that falls within
subsection (g) and not the universe of traffic that falls within subsection
(b )(5).,,27
Id.
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XI.
Level 3 is attempting, through a definitional sleight of hand, to convince the Idaho
Commission to overturn this portion of the FCC's decision in the ISP Remand
Order and to fundamentally change the intercarrier compensation mechanisms
that have governed carrier-to-carrier relationships for years. The Commission
should reject Level3's definition of "interconnection" and its attempt to obtain an
interconnection definition that would include toll, access, and information
services in section 251 (b )( 5) traffic.
DISPUTED ISSUE 11: DEFINITION OF INTEREXCHANGE CARRIER
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
11.
This issue relates to whether the Interconnection Agreement should contain the
definition of "Interexchange Carrier" as proposed by Qwest or use Level 3'
definition.
WHAT IS QWEST'S LANGUAGE PROPOSAL FOR THIS DEFINITION?
Qwest's definition for "Interexchange Carrier" is as follows:
Interexchange Carrier" or "IXC" means a Carrier that provides InterLA A or
IntraLATA Toll services.
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR THE DEFINITION
OF AN INTEREXCHANGE CARRIER?
Level 3' s proposal for the definition of "Interexchange Carrier" is set forth:
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. -
Interexchange Carrier" or "IXC" means a Carrier that provides Telephone
Toll Service.
WHY DOES QWEST BELIEVE THAT ITS DEFINITION IS ACCURATE?
I will state first that this is not an area of disagreement that is significant or will
have a profound effect on the implementation of the interconnection agreement
except as discussed below.Qwest's proposed definition of "Interexchange
Carrier" is the current, standard language included in interconnection agreements
with CL~Cs and has been approved by every Commission in Qwest's region. An
interexchange carrier is an access customer that typically purchases Feature Group
access trunks from Qwest to originate and terminate "interLA T A and
intraLA T A" toll calls. The terms "InterLA T A and IntraLA T A" have been widely
used and understood within the telecommunications industry.The
Communications Act of 1934 (as amended) contains a definition for "'interLA T A
service",28 and references the term "interLA T A" throughout the Act. State
commissions also reference intraLA T A and interLA T A services and refer to "toll"
services ordered by an IXC.
47 D.C. 9 153(21). (InterLATA service "means telecommunications between a point
located in a local access and transport area and a point located outside such area
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9 '
WHY WOULD LEVEL 3 OBJECT TO THE USE OF 'INTERLATA AND
INTRALA T A" IN RELATIONSHIP TO AN IXC?
During negotiations, Level 3 implied that in order for a toll call to be a toll call, a
discrete charge must be imposed on end users. Thus, under this logic, if Level 3
did not charge its customers for VNXX calls, the VNXX calls could not be
categorized as toll calls, could not be subject to access charges, and should be
subject to reciprocal compensation. Level 3's effort to inject the "Telephone Toll
Service" definition appears to be a back door attempt to inject this issue into the
agreement. Although Qwest has little dispute between the two definitions, Qwest
takes strong issue with a Level 3 assertion that the "telephone toll service
definition means that VNXX is not toll and has been validated by the agreement
with all of its attendant implication for access charges and reciprocal
compensation. Under what appears to be Level 3' s theory, a carrier that offers toll
but does not charge its customers for any reason would thereby exempt itself from
FCC or state prescribed access charges. Furthermore, Level 3' s ability as a CL~C
to obtain local numbers carries with it the assumption (apparently false in its case)
that these numbers will be used to originate and/or terminate local calls. Thus
Qwest has no way to determine in advance whether any particular call is really a
toll call that it should be billed as such. Thus, a CL~C like Level 3 that wants to
rely on a definition that a toll call can only be a toll call if there is a charge is
enabled to create its own self-fulfilling prophecy. The reference to charges is
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XII.
addressed to the end user customers. Toll is a retail product sold to end user
customers. The term toll does not address the charges between carriers, exchange
access. Whether or not there is a charge to a retail end user customer for the toll
call will not impact the obligation to pay access charges.
DISPUTED ISSUE 12: DEFINITION OF "INTRALATA TOLL TRAFFIC"
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
12.
This issue relates to whether the Interconnection Agreement should contain the
definition of "IntraLATA Toll" as proposed by Qwest or use Level3's definition.
WHAT IS QWEST'S PROPOSAL FOR "INTRALA T A TOLL"
Qwest's proposal for "IntraLATA toll" is as follows:
IntraLA T A Toll Traffic" describes IntraLA T A Traffic outside the Local
Calling Area.
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL?
Level3's proposal for "IntraLATA toll" is as follows:
IntraLA T A Toll Traffic" describes IntraLA T A Traffic that constitutes
Telephone Toll Service.
Again, the Commission will note that there is little in the way of a substantive
difference here. Both definitions accurately describe a type of IntraLA T A toll call
in different ways. Neither definition will change the impact of the Agreement.
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However, Level 3's injection of the "Telephone Toll Service" definition again
raises the issue of whether Level 3 believes that the inclusion of that definition
means that traffic between two exchanges (i., interexchange traffic) is exempt
from access charges. If so, the companies have a major dispute. The dispute can
be avoided by simply adopting Qwest's language, which is clear and has been
widely accepted in SGA Ts and interconnection agreements.
XIII. DISPUTED ISSUE 9: DEFINITION OF EXCHANGE ACCESS
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
This dispute related to Qwest's proposed definition for "~xchange Access
Qwest agrees with Level 3' s proposed definition that "~xchange Access" will
have the meaning as set forth in the Act. Where Qwest used the word "~xchange
Access" uniquely in Section 7 of the agreement, Qwest simply deleted the words
~xchange Access" and left the remainder of the language "Intralata toll carried
solely by Local ~xchange Carriers, (L~C IntraLA T A toll)". The description of
L~C IntraLA T A toll was not disputed by Level 3 in Section 7, thus we believe
this issue is closed.
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XV.
XIV. DISPUTED ISSUE 14: DEFINITION OF EXCHANGE SERVICE
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
14.
This dispute relates to Level 3' s deletion of the term "~xchange Service" as part
of its request to include "Telephone ~xchange Service in the agreement.
Qwest'definition for "~xchange Service or "~xtended Area Service
(~AS)/Local Traffic" means traffic that is originated and terminated within a
LCA. Qwest cannot nor should the Commission agree to strike "~xchange
Service" from the definitions. ~xchange Service is used in paragraphs throughout
the agreement (most of which Level has not disputed). Qwest objects to the
removal of Qwest's definition for "~xchange Service" as it is used repeatedly
throughout the agreement and is therefore necessary.
DISPUTED ISSUE 15: DEFINITION OF 'TELEPHONE TOLL SERVICE'
PLEASE DESCRIBE THE PARTIES' DISPUTE RELATING TO ISSUE
15.
This issue relates to Level 3' s inclusion of a definition for "telephone toll service
and Qwest's position that it is not necessary to include a separate definition for
telephone toll service.
QW~- T -05~ 11
August 12 2005
Brotherson, L. (Di)
Qwest Corporation
Page 79
WHAT IS LEVEL 3'S LANGUAGE PROPOSAL FOR THE DEFINITION
OF TELEPHONE TOLL SERVICE?
Level3's proposal is as follows:
Telephone toll service - the term "telephone toll service" means telephone
service between stations in different exchange areas for which there is made a
separate charge not included in contracts with subscribers for exchange
servIce.
WHAT IS THE EXISTING DEFINITION FOR SWITCHED ACCESS
SERVICE THAT INCLUDES TELEPHONE TOLL SERVICE?
The definition that has been agreed upon by both parties for "Switched Access
Service states that Switched Access is the service that an IXC orders for
originating and terminating 'telephone toll service.' Switched Access enables
access customers (IXCs) to complete end user customer requests for intrastate or
interstate long-distance calls. The terms and conditions for access services are in
compliance with the rules and regulations for telephone toll service.The
definition reads as follows:
Switched Access Service" means the offering of transmission and switching
services to Interexchange Carriers for the purpose of the origination or
termination of telephone toll service. Switched Access Services include:
Feature Group A, Feature Group B, Feature Group D, 8XX access, and 900
access and their successors or similar Switched Access Services.
QW~-05-
August 12, 2005
Brotherson, L. (Di)
Qwest Corporation
Page 80
DOES QWEST HAVE A PROBLEM WITH THE DEFINITION OF TOLL
SERVICE ITSELF?
No.The definition is from the FCC and is not controversial.What is
controversial is Level 3' s attempt to avoid access charges on telephone toll
elsewhere in the agreement. The real issue regarding this definition is Level 3'
attempt to exempt "telephone toll service" from access charges and instead treat
this traffic as local, and therefore subj ect to reciprocal compensation. Level 3
proposes that telephone toll service be included in section 251 (b )( 5) traffic, traffic
that is treated as local, that is subject to reciprocal compensation, and not subject
to access charges. As an example, in the definition for "Interconnection" Level
s language states: "Section 251(b)(5) traffic, which is defined as Telephone
~xchange Service, ~xchange Access Service, Information Service, and Telephone
Toll Service (including but not limited to intraLATA and interLATA Tolf).
While this is one of the few places where Level 3 spells out that it is making a
definitional attempt to include toll with section 251(b)(5), Level 3 then uses the
term 251(b)(5) traffic throughout the agreement without mentioning the fact that it
has defined it to include toll.This is an inappropriate attempt to redefine
categories of traffic in ways that will dramatically change methods of
compensation. It should not be accepted by the Commission.
QW~- T -05-
August 12, 2005
Brotherson, L. (Di)
Qwest Corporation
Page 81
DOES QWEST HAVE A PROBLEM WITH THE DEFINITION ITSELF?
No. As long as the Commission remains mindful ofLevel3's improper use of the
term in other paragraphs involved in this arbitration.
DOES THIS CONCLUDE YOUR TESTIMONY?
Yes, it does.
QW~- T -05-
August 12, 2005
Brotherson, L. (Di)
Qwest Corporation
Page 82
Exhibits to Direct Testimony of Larry B. Brotherson
Qwest Corporation
Docket No. 05B-210T
August 12, 2005
INDEX
DESCRIPTION
~SP Connection
VoIP Routing
Virtual NXX
INDEX TO EXHIBITS
Exhibit
Qwest No. 301
Qwest No. 302
Qwest No. 303
QW~-05-
August 12, 2005
Brotherson, L. (Di)
Qwest Corporation
IND~X
CERTIFICATE OF SERVICE
I do hereby certify that a true and correct copy of the foregoing DIRECT TESTIMONY OF
LARRY B. BROTHERSON was served on the 12th day of August, 2005 by first class mail, postage
prepaid on the following individuals:
Jean Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ID 83720-0074
iiewell~puc.state.id.
Weldon Stutzman
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ID 83720-0074
Telephone: [phone]
wel don. stutzman~puc . Idaho. gov
Erik Cecil
Regulatory Counsel
Level 3 Communications, LLC
1025 Eldorado Boulevard
Broomfield, CO 80021
erik.cecil~leve13 .com
Henry T. Kelly
Joseph E. Donovan
Scott A. Kassman
Kelley Drye & Warren LLP
333 West Wacker Drive
Chicago, Illinois 60606
[phone] (telephone)
[phone] (facsimile)
hkelly~kelleydrye.com
Dean J. Miller
McDevitt & Miller LLP
420 West Bannock Street
O. Box 2564
Boise, ID 83702
joe~mcdevitt-miller.com
..x..Hand Delivery
U. S. Mail
Overnight Delivery
Facsimile
Email
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Overnight Delivery
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Brandi L. Gearhart
Legal Assistant
Stoel Rives LLP
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