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Mary S. Hobson, ISB #2142
Stoel Rives LLP
101 S. Capitol Blvd., Suite 1900
Boise, ill 83702-5958
Telephone: [phone]
Facsimile: [phone]
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Thomas M. Dethlefs
Qwest Services Corporation
1801 California Street - 10th Floor
Denver, CO 80202-1984
Telephone: [phone]
Facsimile: [phone]
Attorneys Representing Qwest Corporation
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MA TIER OF LEVEL 3
COMMUNICATIONS, LLC'S PETITION FOR
ARBITRATION PURSUANT TO SECTION
252(B) OF THE COMMUNICATIONS ACT OF
1934, AS AMENDED BY THE
TELECOMMUNICATIONS ACT OF 1996, AND
THE APPLICABLE STATE LAWS FOR RATE
TERMS, AND CONDITIONS OF
INTERCONNECTION WITH QWEST
CORPORATION
CASE NO. QWE- T -05-
DIRECT TESTIMONY OF
WILLIAM R. EASTON
QWEST CORPORATION
August 12,2005
(Disputed Issue Nos. 1 , 5, 13, 17, 18, 21 and 22)
Boise-186412.l 0061273-00018
II.
III.
IV.
VI.
VII.
TABLE OF CONTENTS
PAGE
IDENTIFICATION OF WITNESS ........................................................... ............
PURPOSE OF TESTIMONY...................................... .............
....... ........
.............. 2
DISPUTED ISSUE NO.1: COSTS OF INTERCONNECTION .........................
DISPUTED ISSUE NO.2 (A-B): ALL TRAFFIC ON
INTERCONNECTION TRUNKS......................................................... ..... ......... 24
DISPUTED ISSUE NO.5: SHOULD INTERCONNECTION TERMS BE
INCORPORATED BY REFERENCE........... ............... ............... ......... .............. 33
DISPUTED ISSUE NO. 13: LOCAL INTERCONNECTION SERVICE
DEFINITION .......................................................................................................
DISPUTED ISSUE NO. 17: TRUNK FORECASTING .....................................
VIII. DISPUTED ISSUE NO. 18: JURISDICTIONAL ALLOCATION
IX.
FACTORS........................ .................................................................................... 38
DISPUTED ISSUE NO. 21: ORDERING OF INTERCONNECTION
TRUNKS... .......
...... ... ......... ..... ..... ...... ..... .... ........ ..... ... .... ..... ......... ....... ... ..... ........
DISPUTED ISSUE NO. 22: COMPENSATION FOR SPECIAL
CONSTRUCTION............................................... ............. ................................... 44
XI.SUMMARY/CONCLUSION ..............................................................................
. Boise-186412.l 0061273-00018
IDENTIFICATION OF WITNESS
PLEASE STATE YOUR NAME, OCCUPATION AND BUSINESS
ADDRESS.
My name is William R. Easton. My business address is 1600 7th Avenue, Seattle
Washington. I am employed as Director - Wholesale Advocacy. I am testifying
on behalf of Qwest Corporation ("Qwest"
PLEASE GIVE A BRIEF DESCRIPTION OF YOUR EDUCATIONAL
BACKGROUND AND TELEPHONE COMPANY EXPERIENCE.
I graduated from Stanford University in 1975 , earning a Bachelor of Arts degree.
In 1980, I received a Masters of Business Administration from the University of
Washington. In addition, I am a Certified Management Accountant.
I began working for Pacific Northwest Bell in 1980, and have held a series of jobs
in financial management with U S WEST, and now with Qwest, including staff
positions in the Treasury and Network organizations. From 1996 through 1998, I
was Director - Capital Recovery. In this role I negotiated depreciation rates with
state commission and FCC staffs and testified in various regulatory proceedings.
From 1998 until 2001 I was a Director of Wholesale Finance, responsible for the
management of Wholesale revenue streams from a financial perspective. In this
capacity I worked closely with the Product Management organization on their
product offerings and projections of revenue. In October of 2001 I moved from
Wholesale Finance to the Wholesale Advocacy group, where I am currently
QWE-05-11 Easton, W (DI)
August 12, 2005 Qwest Corporation
Page
responsible for advocacy related to Wholesale products and services. In this role I
work extensively with the Product Management, Network and Costing
organizations.
HAVE YOU TESTIFIED PREVIOUSLY IN IDAHO?
Yes I have. I testified in docket number USW-96-
II.PURPOSE OF TESTIMONY
WHAT IS THE PURPOSE OF YOUR TESTIMONY?
The purpose of my testimony is to explain Qwest's positions , and the regulatory
policies underlying those positions, as they relate to certain disputed issues
between the parties. My testimony will show that the Qwest position on these
issues seeks to strike a balance between meeting the interconnection needs of
Level 3, while at the same time ensuring that the services, terms and conditions in
the agreement comply with the governing law and are technically feasible.
Specifically, my testimony will address the following issues from the Matrix
Unresolved Issues filed by Level 3 in this arbitration:
Issue 1: Costs of Interconnection
Issue 2: Combining Traffic on Interconnection Trunks
Issue 5: Should Interconnection Terms be Incorporated by
Reference
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Issue 13: Local Interconnection Service Definition
Issue 17: Trunk Forecasting
Issue 18: Jurisdictional Allocation Factors
Issue 21: Ordering of Interconnection Trunks
Issue 22: Compensation for Construction
III.DISPUTED ISSUE NO.1: COSTS OF INTERCONNECTION
PLEASE EXPLAIN DISPUTED ISSUE NO.
Issue No.1 is comprised of 10 subparts (lA-1J), all of which have to do with
local interconnection.Although Level 3 characterizes this issue as being a
question of whether Level 3 may exchange traffic at single point of
interconnection in the LATA, this issue is actually about compensation for the use
of Qwest's network. In this case, Level 3 has requested interconnection at a
single point in each LATA. There is presently no dispute as to where the
interconnection occurs or how many points of interconnection there will be. What
is in dispute is who bears the costs of the interconnection Level 3 has requested.
Qwest contends that Level 3 is responsible for compensating Qwest for the
interconnection costs that Qwest incurs to honor Level 3' s request. Contrary to
Level 3' s claims, this is true even when costs are incurred on Qwest' s side of the
point of interconnection.
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Under the Telecommunications Act of 1996, Qwest has a duty to provide
interconnection with its local exchange network "on rates, terms and conditions
that are just, reasonable, and nondiscriminatory" and in accordance with the
requirements of Section 252 of the ACt.1 Section 252 of the Act in turn provides
that determinations by a state commission of the just and reasonable rate for the
interconnection shall be "based on the cost.. .of providing the interconnection
nondiscriminatory" and "may include a reasonable profit.,,2 As the FCC has
recognized, these provisions make clear that CLECs must compensate incumbent
LECs for the costs incumbent LECs incur to provide interconnection.
Qwest has fulfilled its duty to provide interconnection by developing Local
Interconnection Service (LIS) for CLECs to interconnect with Qwest. LIS has
multiple intercarrier transport options. One option, the Mid-Span Meet POI
option, allows the CLEC to build to a mid-way point between the CLEC's Point
of Interconnection ("POI")/switch and a Qwest tandem or end office switch.
Another option is collocation, which allows a CLEC to put equipment in one of
Qwest's serving wire centers and interconnect at that collocation. Both of these
options put some cost of establishing the point of interconnection on the CLEC.
Qwest also provides an entrance facility option for purchase for those CLECs who
1 47 V.C. 9251(c)(2)(D).
47 V.C. 9252(d)(1)
See Implementation of the Local Competition Provisions in the Telecommunications Act of
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do not want to incur capital expense by either laying fiber for a mid-span meet
POI or setting up a collocation. An entrance facility creates transport between a
CLEC building and the nearest Qwest building termed a Serving Wire Center
(SWC). Once the CLEC has interconnected with Qwest at the SWC, the CLEC
may need to have Direct Trunk Transport and multiplexing to complete calls
throughout the Qwest network. There are multiple costs associated with Qwest
providing entrance facility, direct trunk transport and multiplexing. These costs
have been identified and discussed in cost dockets with the Commission. As
stated earlier, Qwest is allowed to recover costs that are just and reasonable and
based on the cost of providing interconnection.
It makes sense that the cost causer compensates Qwest for interconnection and
transport costs. If the cost causer (Level 3) does not pay, then Qwest end users
would have to bear the cost, including customers who have no interest in surfing
the internet via dial-up service. Qwest's end users should not have to bear the
burden of paying for Level 3' s ISP service.
With this as background, the next sections of my testimony will discuss each of the
disputed sub-issues (lA-1J).
1996, ~~209, 11 FCC Rec. 15499 (August 8, 1996), aff'd in part and rev d in part, Iowa Uti/so
Bd. v. FCC 525 U.S. 1133 (1999)(the Local Competition Order
QWE-05-11 Easton, W (DI)
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Issue No. lA
PLEASE DESCRIBE ISSUE NO. lA.
Issue 1A involves disputed language that Level 3 characterizes as having to do
with the right to interconnect at a single point in the LATA and obligations on the
respective sides of the point of interconnection. As Phil Linse discusses in his
testimony, Qwest has not required Level 3 to interconnect at each end office in
the LATA. The real issue here is that Level 3 does not want to pay for the use of
Qwest's network.
WHAT IS THE LANGUAGE IN DISPUTE?
The parties disagree about the language for Section 7.1 of the agreement, which
is found on page 66 of the interconnection agreement ("ICA") filed by Qwest
with its Response to Petition for Arbitration. The ICA contains the language
proposed by Qwest juxtaposed against the language proposed by Level 3. Qwest
proposes the following language:
This Section describes the Interconnection
of Qwest's network and CLEC's network for the purposeof exchanging Exchange Service (EAS/Local traffic),
IntraLATA Toll carried solely by local exchange carriers
and not by an IXC (IntraLATA LEC toll), ISP-Bound
traffic, and Jointly Provided Switched Access (InterLATAand IntraLA T A) traffic. Qwest will provide
Interconnection at any Technically Feasible point within its
network. Interconnection, which Qwest currently names
Local Interconnection Service" (LIS), is provided for the
purpose of connecting End Office Switches to End Office
Switches or End Office Switches to local or Access
Tandem Switches for the exchange of Exchange Service
(EAS/Local traffic); or End Office Switches to Access
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Tandem Switches for the exchange of IntraLA T A LEC Toll
or Jointly Provided Switched Access traffic. Qwest
Tandem Switch to CLEC Tandem Switch connections will
be provided where Technically Feasible. New or continued
Qwest local Tandem Switch to Qwest Access Tandem
Switch and Qwest Access Tandem Switch to Qwest Access
Tandem Switch connections are not required where Qwest
can demonstrate that such connections present a risk of
Switch exhaust and that Qwest does not make similar use
of its network to transport the local calls of its own or any
Affiliate s End User Customers.
WHAT LANGUAGE DOES LEVEL 3 PROPOSE?
Level 3 proposes the following:
This Section describes the Interconnection of
Qwest's network and CLEC's network for the purpose ofexchanging Telecommunications Including Telephone
Exchange Service And Exchange Access traffic. Qwest
will provide Interconnection at any Technically Feasible
point within its network.
1.1.1 Establishment of SPOI: Qwest agrees to
provide CLEC a Single Point of Interconnection (SPOI) in
each Local Access Transport Area (LATA) for the
exchange of all telecommunications traffic. The SPOI may
be established at any mutually agreeable location within the
LATA, or, at Level 3' s sole option, at any technically
feasible point on Qwest's network. Technically feasible
points include but are not limited to Qwest's end offices
access tandem, and local tandem offices.
2 Cost Responsibility. Each Party
responsible for constructing, maintaining, and operating all
facilities on its side of the SPOI, subject only to the
payment of intercarrier compensation in accordance with
Applicable Law. In accordance with FCC Rule 51.703(b),
neither Party may assess any charges on the other Party for
the origination of any telecommunications delivered to the
other Party at the SPOI, except for Telephone Toll Service
traffic outbound from one Party to the other when the other
Party is acting in the capacity of a provider of Telephone
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Toll Service, to which originating access charges properly
apply.
1.3 Facilities included/transmission rates. Each
SPOI to be established under the terms of this Attachment
shall be deemed to include any and all facilities necessary
for the exchange of traffic between Qwest's and Level 3'
respective networks within a LATA. Each Party may use
an Entrance Facility (EF), Expanded Interconnect Channel
Termination (EICT), or Mid Span Meet Point of
Interconnection (POI) and/or Direct Trunked Transport
(DTT) at DS 1 , DS3 , OC3 or higher transmission rates as
in that Party s reasonable judgment, is appropriate in light
of the actual and anticipated volume of traffic to
exchanged. If one Party seeks to establish a higher
transmission rate facility than the other Party would
establish, the other Party shall nonetheless reasonably
accommodate the Party decision to use higher
transmission rate facilities.
1.4 Each Party Shall Charge Reciprocal
Compensation for the Termination of Traffic to be carried.
All telecommunications of all types shall be exchanged
between the Parties by means of from the physical facilities
established at Single Point of Interconnection Per LATA
onto its Network Consistent With Section 51.703 of the
FCC's Rules:
1.4.Level 3 may interconnect
with Qwest at any technically feasible point on Qwest'snetwork for the exchange of telecommunications traffic.
Such technically feasible points include but are not limited
to Qwest access tandems or Qwest local tandems. When
CLEC is interconnected at the SPOI. separate trunk groups
for separate types of traffic may be established in
accordance with the terms hereof. No separate physical
interconnection facilities, as opposed to separate trunk
groups within SPOI facilities, shall be established except
upon express mutual agreement of the Parties.
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WHY IS QWEST OPPOSED TO THE LEVEL 3 LANGUAGE?
With regard to the SPOI, Level 3' s language is not appropriate from a network
standpoint. Mr. Linse s testimony discusses why the language is inappropriate and
details the options available to Level 3 to interconnect with Qwest. The final two
sections of Level 3's language have to do with cost responsibility and do not
belong in this section. Section 7.1 has to do with interconnection facility options
not compensation. Qwest's proposals for compensation, including reciprocal
compensation, appear elsewhere in the interconnection agreement and will
fully discussed as disputed issues later in this testimony.
LEVEL 3 ALSO OBJECTS TO QWEST'S LANGUAGE FOR SECTION
1.1.1 AND SECTION 7.1.1.2. ARE THESE SECTIONS RELATED TO
THE ISSUES YOU HAVE JUST DISCUSSED?
No. These two sections have to do with VoIP traffic and will be discussed in the
testimony of Larry Brotherson.
Issue No. IB
PLEASE DESCRIBE ISSUE NO. lB.
Issue 1B concerns the methods by which the parties facilitate interconnection
between their respective networks. This issue is addressed in the testimony of
Mr. Linse.
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Issue No. lC
PLEASE DESCRIBE ISSUE NO.1 C.
Issue 1 C concerns section 7.1 of the agreement, found on page 71 of the
ICA, which describes how Exchange Service traffic will be terminated. Both
Qwest and Level 3 agree that Exchange Service (EAS/Local) traffic will be
terminated as Local Interconnection Service (LIS), but Qwest disagrees with the
additional language that Level 3 has added to this section.
WHAT LANGUAGE IS LEVEL 3 PROPOSING TO ADD?
After the agreed upon description of Exchange Service traffic termination, Level
3 proposes to insert the following language:
Notwithstanding references to LIS and to trunking and
facilities used or provisioned in association with LIS,
nothing in this Agreement shall be construed to require
CLEC to pay Qwest for any services or facilities on
Qwest's side of the POI in connection with the origination
of traffic from Qwest to CLEC; and nothing herein shall be
construed to require CLEC to pay for any services or
facilities on Qwest's side of the POI in connection with the
termination of traffic from CLEC by Qwest, other than
reciprocal compensation payments as provided in Section
hereof.
WHY DOES QWEST OBJECT TO THIS LANGUAGE?
Qwest objects to the inserted language because it deals with compensation, a
subject that is more appropriately addressed in section 7.3 of the agreement. In
fact, Level 3 attempts to insert similar language at multiple places in the
interconnection agreement. Level 3' s persistence does nothing to change its
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obligations under the law. As I stated in my preface to Issue No., the Act
clearly allows for Qwest to receive compensation for providing interconnection to
CLECs.
Issue No. ID
PLEASE EXPLAIN ISSUE NO. ID.
Issue No. 1D has to do with transport services to deliver Exchange Service
EAS/Local traffic from the POI to the terminating party s end office switch or
tandem switch for call termination.
WHAT LANGUAGE IS QWEST PROPOSING FOR THIS SECTION?
Qwest proposes the following language:
CLEC may purchase transport
services from Qwest or from a third party, including a third
party that has leased the private line transport service
facility from Qwest. Such transport provides a
transmission path for the LIS trunk to deliver the
originating Party s Exchange Service EAS/Local traffic to
the terminating Party s End Office Switch or Tandem
Switch for call termination. Transport may be purchased
from Qwest as Tandem Switch routed (i.e., tandem
switching, tandem transmission and direct trunked
transport) or direct routed (i., direct trunked transport).
This Section is not intended to alter either Party
obligation under Section 251(a) of the Act.
WHAT LANGUAGE DOES LEVEL 3 PROPOSE?
Level 3 proposes the following language:
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2. CLEC may order transport services from Qwest or from a
third-party, including a third party that has leased the private line transport
service facility from Qwest for purposes of network management and
routing of traffic to/from the POI.Such transport provides a transmission
path for the LIS trunk to deliver the originating Party s Exchange Service
EAS/Local traffic to the terminating Party s End Office Switch or Tandem
Switch for call termination. This Section is not intended to alter either
Party s obligation under Section 251(a) of the Act or under Section 51.703
or 51.709 of the FCC's Rules.
WHAT IS THE DIFFERENCE BETWEEN THE TWO PROPOSALS?
Level 3 changes the word "purchase" to "order ' in the first sentence and adds the
words which have been underlined at the end of the sentence. Level 3 also strikes
the second to last sentence in Qwest's language which begins
, "
Tandem transport
may be purchased from Qw~st. . ." Level 3 mistakenly believes that removing the
word "purchase" somehow relieves it of the obligation to compensate Qwest for
the use of its network. Level 3 acknowledges this transport is necessary and has
not objected to the sentence that states
, "
Such transport provides a transmission
path for the LIS trunk to deliver the originating Party s Exchange Service
EAS/Local traffic to the terminating Party s End Office Switch or Tandem Switch
for call termination.It has even acknowledged that it needs to order transport
services. What Level 3 refuses to acknowledge is that it has an obligation to
compensate Qwest for providing the services that allow Level 3 to serve its ISP
end users. Compensation issues will be addressed fully later in the testimony.
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Issue No. IE
14'
PLEASE EXPLAIN ISSUE IE.
Issue IE concerns section 7.1.4 of the interconnection agreement which
discusses direct trunked transport. Qwest has proposed the following language:
1.4 LIS ordered to a Tandem Switch will be
provided as direct trunked transport between the Serving
Wire Center of CLEC's POI and the Tandem Switch.
Tandem transmission rates, as specified in Exhibit A of this
Agreement, will apply to the transport provided from the
Tandem Switch to Qwest's End Office Switch.
WHAT POSITION IS LEVEL 3 TAKING ON THIS ISSUE?
Level 3 has agreed to the first sentence but has removed the last sentence, again
apparently in the belief that removing any reference to rates relieves it of the
obligation to compensate Qwest for the use of the Qwest network to provide
service to Level 3' s end users.
Issue No. IF
PLEASE EXPLAIN ISSUE NO. IF.
Issue 1 F concerns Section 7.6 of the agreement, found on page 81 of the
ICA, which discusses Level 3's ability to interconnect at tandem and end office
switches. Qwest proposes the following language:
The Parties shall terminate Exchange
Service (EAS/Local) traffic on Tandem Switches or End
Office Switches. CLEC may interconnect at either the
Qwest local tandem or the Qwest access tandem for the
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delivery of local exchange traffic. When CLEC is
interconnected at the access tandem and when there is a
DS1 level of traffic (512 BHCCS) over three (3)
consecutive months between CLEC's Switch and a Qwest
End Office Switch, Qwest may request CLEC to order a
direct trunk group to the Qwest End Office Switch. CLEC
shall comply with that request unless it can demonstrate
that such compliance will impose upon it a material adverse
economic or operations impact. Furthermore, Qwest may
propose to provide Interconnection facilities to the local
Tandem Switches or End Office Switches served by the
Access Tandem Switch at the same cost to CLEC as
Interconnection at the Access Tandem Switch. If CLEC
provides a written statement of its objections to a Qwest
cost-equivalency proposal, Qwest may require it only: (a)
upon demonstrating that a failure to do so will have a
material adverse affect on the operation of its network and
(b) upon a finding that doing so will have no material
adverse impact on the operation of CLEC, as compared
with Interconnection at such Access Tandem Switch.
WHAT LANGUAGE DOES LEVEL 3 PROPOSE?
When CLEC is interconnected at the access
tandem and when there is a DS 1 level of traffic (512
BHCCS) over three (3) consecutive months between
CLEC's Switch and a Qwest End Office Switch Qwest
may request CLEC to order a direct trunk group to the
Qwest End Office Switch. Notwithstanding references to
Qwest's ability to requests that CLECs order direct trunk
groups to the Qwest end office, nothing in this agreement
shall e shall be construed to require CLEC to pay Qwest for
any services or facilities on Qwest's side of the POI in
connection with the origination of traffic from Qwest to
CLEC; and nothing herein shall be construed to require
CLEC to pay for any services or facilities on Qwest's side
of the POI in connection with the termination of traffic
from CLEC by Qwest, other than reciprocal compensation
payments as provided in this Agreement.
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WHY IS QWEST OPPOSED TO THE LEVEL 3 LANGUAGE?
Level 3 has stricken the first two sentences of Qwest's language that describes
how Level 3 may interconnect at Qwest local and tandem switches. Mr. Linse
describes in his testimony why this language is important from a network
perspective. In addition, while agreeing that Qwest may request Level 3 to order
a direct trunk group to a Qwest end office switch, Level 3 has removed the Qwest
language that would have Level 3 comply with the request, thereby effectively
absolving Level 3 of any responsibility for network efficiencies. Finally, Level 3
again inserts the disclaimer that it should not have to pay for the use of the Qwest
network. This language not only ignores Level 3's obligations under the law, but
is also clearly misplaced in a section describing the technical aspects of
interconnection.
Issue No. IG
PLEASE DESCRIBE ISSUE 1 G.
Issue 1G concerns Sections 7.3.1.1.3 and 7.3.1.1.3.1 , found on page 83 of the
ICA, which discuss how the cost of jointly used facilities shall be shared by the
parties.
WHAT LANGUAGE DOES QWEST PROPOSE?
Qwest proposes the following language:
7.3 .1.1.3 If the Parties elect to establish LIS two-way
trunks, for reciprocal exchange of Exchange Service
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(EAS/Local) traffic, the cost of the LIS two-way facilities
shall be shared among the Parties by reducing the LIS two-
way entrance facility (EF) rate element charges as follows:
7.3.1.1.3.Entrance Facilities - The provider of
the LIS two-way Entrance Facility (EF) will initially share
the cost of the LIS two-way EF by assuming an initial
relative use factor (RUF) of fifty percent (50%) for a
minimum of one (1) quarter if the Parties have not
exchanged LIS traffic previously. The nominal charge to
the other Party for the use of the EF, as described in Exhibit
, shall be reduced by this initial relative use factor.
Payments by the other Party will be according to this initial
relative use factor for a minimum of one (1) quarter. The
initial relative use factor will continue for both bill
reduction and payments until the Parties agree to a new
factor, based upon actual minutes of use data for non- ISP-
bound traffic to substantiate a change in that factor. If a
CLEC's End User Customers are assigned NP A NXXs
associated with a rate center different from the rate center
where the Customer is physically located, traffic that does
not originate and terminate within the same Qwest local
calling area (as approved by the Commission), regardless
of the called and calling NP A-NXXs, involving those
Customers is referred to as "VNXX traffic . For purposes
of determining the RUF, the terminating carrier is
responsible for ISP-bound traffic and for VNXX traffic. If
either Party demonstrates with non- ISP-bound traffic data
that actual minutes of use during the first quarter justify a
new relative use factor, that Party will send a notice to the
other Party. Once the Parties finalize a new factor, the bill
reductions and payments will apply going forward, from
the date the original notice was sent. ISP-bound traffic or
traffic delivered to Enhanced Service providers is interstate
in nature. Qwest has never agreed to exchange . VNXX
Traffic with CLEC.
WHAT LANGUAGE DOES LEVEL 3 PROPOSE?
Level 3 proposes the following:
7.3.1.1.3
all costs
QWE- T -05-
August 12, 2005
Each party is solely responsible for any and
arising from or related to establishing and
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maintaining the interconnection trunks and facilities it uses
to connect to the POI. Thus, neither party shall require the
other to bear any additional costs for the establishment and
operation of interconnection facilities that connect its
network to its side of the POI.
7.3.1.1.3.Intercarrier compensation.
Intercarrier compensation for traffic exchanged at the SPOI
shall be in accordance with FCC Rule 51.703 and
associated FCC rulings. For avoidance of doubt, any traffic
that constitutes "telecommunications and that is not
subject to switched access charges, including without
limitation so-called "information access" traffic, shall be
subject to compensation from the originating carrier to the
terminating carrier at the FCC-mandated capped rate (as of
the effective date hereof) of $0.0007 per minute. Any
dispute about the appropriate intercarrier compensation
applicable to any particular traffic shall be resolved by
reference to the FCC's rule and associated orders.
WHY IS QWEST OPPOSED TO THE LEVEL 3 LANGUAGE?
Level 3 again denies that it has an obligation to compensate Qwest for the use of
its network. This assertion is contrary to the FCC's rule 51.709(b) which states:
The rate of a carrier providing transmission facilities
dedicated to the transmission of traffic between two
carriers' networks shall recover only the costs of the
proportion of that trunk capacity used by an interconnecting
carrier to send traffic that will terminate on the providing
carrier s network. Such proportions may be measured
during peak periods.
IN PREVIOUS ARBITRATIONS WITH QWEST DID LEVEL 3 MAKE
THIS SAME ARGUMENT?
No. In previous arbitrations, Level 3 agreed to use a relative use factor to
apportion the transport cost associated with two-way trunking, but disagreed as to
the type of traffic that should be included in the calculation.
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IS THERE A FORM OF INTERCONNECTION THAT LEVEL 3 CAN
EMPLOY WHICH WOULD ALLOW IT TO AVOID PAYING FOR THE
RELATIVE USE OF AN ENTRANCE FACILITY?
Yes. Under the agreed-to provisions of the interconnection agreement, there are a
number of ways in which Level 3 can choose to interconnect with the Qwest
network. One of these options, explained in 7.2.3 of the agreement, is a Mid-
Span Meet POI. The relative use calculations that apply to an entrance facility
purchased from Qwest do not apply to a Mid-Span Meet POI. As noted in
Section 7.2.3 , under this option "( e )ach Party will be responsible for its portion
of the build to the Mid-Span Meet POI." Thus, to the extent that Level 3 seeks to
avoid any financial responsibility for facilities on the Qwest side of the Mid-Span
POI, it is free, under this agreement, to select the Mid-Span Meet POI option
under which both parties are obligated to construct facilities to the agreed to POI
and neither party is responsible for the charges associated with the facility on the
other party s side of the Mid-Span POI. Level 3 can also choose to provide
collocation, which would also not entail the purchase of an entrance facility to
connect with Qwest's network.
There are, however, sound reasons for Level 3 to choose the entrance facility
options, instead of the Mid-Span Meet POI. By so choosing, Level 3 is able to
avoid the initial, and often substantial, investment associated with building its
own facilities to the POI. By choosing the entrance facility option, Level 3 pays a
nominal non-recurring charge to "turn-on" the Qwest facilities and then pays a
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monthly recurring charge that is subject to a credit based on Qwest's relative use
of the facilities. Level 3 is clearly avoiding significant capital expenditures by
ordering the LIS entrance facility, yet is unwilling to compensate Qwest for this
facility.
WHY IS IT APPROPRIATE TO EXCLUDE ISP-BOUND AND VNXX
TRAFFIC FROM THE RELATIVE USE CALCULATION?
The FCC rule I just cited appears in Subpart H of the FCC's rules, which is titled
Reciprocal Compensation for Transport and Termination of Telecommunications
traffic . In Section 51.701(b)(1) the FCC defines "telecommunications traffic" as
traffic "exchanged between a LEC and a telecommunications carrier other than a
CMRS provider except for telecommunications traffic that is interstate or
intrastate exchange access, informaiion access, or exchange services for such
access.(Italics added). In the ISP Remand Order 4 the FCC determined that ISP
bound traffic (traffic destined for a local ISP server) is information access. As
such, this traffic is expressly excluded from the traffic referred to in 51. 709(b).
Similarly, VNXX (or interexchange) traffic must be excluded, for, as Mr.
Brotherson makes clear in his testimony, VNXX calls that do not originate and
terminate in the same local calling area are not subj ect to the reciprocal
compensation obligations of 251 (b )( 5).
Order on Remand In the Matter of Implementation of the Local Competition Provisions in the
Telecommunications Act of 1996, Intercarrier Compensation for ISP-Bound Traffic 16 FCCR
9151 (2001) ISP Remand Order ~ 42.
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WAS EXCLUDING ISP-BOUND TRAFFI C FROM THE RUF
CALCULATION DISCUSSED DURING THE 271 MUL TI-ST ATE
WORKSHOPS?
Yes, this was a topic of discussion during the 271 workshops. Ultimately the
parties participating in the workshops agreed to the language appearing in the
Qwest Idaho SGA T that excludes ISP-bound traffic from the calculation.
IN ITS PETITION, LEVEL 3 CITES THE FCC'S RULE 51.703(B) AND
ARGUES THAT ILECS ARE PROHIBITED FROM LEVYING CHARGES
FOR TRAFFIC ORIGINATING ON THEIR OWN NETWORKS. DO YOU
AGREE?
No. 51. 703(b) applies to "telecommunications traffic." As was just discussed
ISP bound traffic (traffic destined for a local ISP server) is "information access
and is specifically excluded from the definition of telecommunication traffic.
Clearly, 51. 703(b) does not apply in the case of such ISP bound traffic.
Issue No. IH
PLEASE EXPLAIN THE DISPUTE RELATED TO ISSUE NO. IH.
Issue 1 H is the same as Issue G, except that, where 1 G concerned allocating the
cost of a two-way entrance facility, 1H deals with allocating the cost of two-way
direct transport facilities.
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WHAT LANGUAGE IS QWEST PROPOSING?
Qwest is proposing the following language:
7.3.2 If the Parties elect to establish LIS two-way DTT
trunks, for reciprocal exchange of Exchange Service
(EAS/Local) traffic the cost of the LIS two-way DTT
facilities shall be shared among the Parties by reducing the
LIS two-way DTT rate element charges as follows:
7.3.Direct Trunked Transport - The
provider of the LIS two-way DTT facility will initially
share the cost of the LIS two-way DTT facility by
assuming an initial relative use factor of fifty percent (50%)
for a minimum of one (1) quarter if the Parties have not
exchanged LIS traffic previously. The nominal charge to
the other Party for the use of the DTT facility, as described
in Exhibit A, shall be reduced by this initial relative use
factor. Payments by the other Party will be according to
this initial relative use factor for a minimum of one (1)
quarter. The initial relative use factor will continue for
both bill reduction and payments until the Parties agree to a
new factor based upon actual minutes of use data for non-
ISP-bound traffic to substantiate a change in that factor. If
a CLEC' sEnd User Customers are assigned a NP A NXXs
associated with a rate center other than the rate center
where the Customer is physically located, traffic that does
not originate and terminate within the same Qwest local
calling area (as approved by the Commission), regardless
of the called and calling NP A-NXXs, involving those
Customers is referred to as "VNXX traffic . For purposes
of determining the RUF, the terminating carrier is
responsible for ISP-bound traffic and for VNXX traffic.
either Party demonstrates with non-ISP-bound traffic data
that actual minutes of use during the first quarter justify a
new relative use factor, that Party will send a notice to the
other Party. Once the Parties finalize a new factor, the bill
reductions and payments will apply going forward, from
the date the original notice was sent. ISP-bound traffic is
interstate in nature. Qwest has never agreed to exchange
VNXX Traffic with CLEC.
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WHAT IS LEVEL 3'S PROPOSED LANGUAGE?
Level 3 proposes the following language:
2 Each party is solely responsible for any and all costs
arising from or related to establishing and maintaining the
interconnection trunks and facilities it uses to connect to
the POI. Thus, neither party shall require the other to bear
any additional costs for the establishment and operation of
interconnection facilities that connect its network to its side
of the POI.
Qwest is opposed to this language for all of the reasons cited in the discussion of
issue 1
Issue No. 11
PLEASE DESCRIBE ISSUE
Issue 1 I again involves compensation, in this case non-recurring charges for the
installation of LIS trunks. Qwest proposes the following language:
7.3.3.1 Installation nonrecurring charges may be assessed
by the provider for each LIS trunk ordered. Qwest rates are
specified in Exhibit A.
WHAT LANGUAGE DOES LEVEL 3 PROPOSE?
Level 3 proposes the following language:
7.3.3.1 Neither Party may charge (and neither Party shall
have an obligation to pay) any installation nonrecurring
charges or the like, for any LIS trunk ordered for purposes
of exchanging ISP-Bound Traffic, 25)(b)(5) Traffic, and
VoIP Traffic that either Party delivers at a POI, other than
the intercarrier compensation rates.
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ARE QWEST'S OBJECTIONS TO THIS LANGUAGE THE SAME
FOR THE OTHER INTERCONNECTION COMPENSATION ISSUES?
Yes. Qwest opposes this language because it denies Qwest compensation for
work performed on behalf of Level 3. In addition, Level 3 inappropriately inserts
language regarding the type of traffic to be exchanged over LIS trunks, a subject
more appropriately addressed elsewhere in the agreement.
Issue No.
PLEASE DESCRIBE ISSUE IJ.
Like issue 1H, issue 1J involves the assessment of non-recurring charges related
to LIS trunking, in this case non-recurring charges related to trunk
rearrangements. Qwest proposes the following language:
2 Nonrecurring charges for rearrangement may be
assessed by the provider for each LIS trunk rearrangement
ordered, at one-half (1/2) the rates specified in Exhibit A.
WHAT LANGUAGE IS LEVEL 3 PROPOSING?
Level 3 proposes the following language:
3.3.2 Neither Party may charge (and neither Party shall
have an obligation to pay) any nonrecurring charges for
rearrangement assessed for any LIS trunk rearrangement
ordered for purposes of exchanging ISP-Bound Traffic
251 (b )( 5) Traffic, and VoIP Traffic that either Party
delivers at a POI, other than the intercarrier compensation
rates.
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Again, Qwest opposes this language because it denies Qwest compensation for
work performed on behalf of Level 3 and again adds language regarding the
exchange of traffic which is more appropriately addressed elsewhere in the
agreement.
IV.DISPUTED ISSUE NO.2 (A-B): ALL TRAFFIC ON
INTERCONNECTION TRUNKS
PLEASE EXPLAIN DISPUTED ISSUE NO 2.
Issue 2, found on pages 79-80 of the ICA, concerns what types of traffic may be
combined over LIS trunks and whether Qwest is entitled to compensation for the
interconnection trunks it provides to Level 3.
WHAT LANGUAGE IS QWEST PROPOSING FOR SECTION 7.
Qwest is proposing the following language:
9.3.Exchange Service (EAS/Local), ISP-Bound
Traffic, IntraLATA LEC Toll , VoIP traffic and Jointly
Provided Switched Access (InterLA T A and IntraLA T A
Toll involving a third party IXC) may be combined in a
single LIS trunk group or transmitted on separate LIS trunk
groups.
9.3.1.1 If CLEC utilizes trunking
arrangements as described in Section 7.9.3., Exchange
Service (EAS/Local) traffic shall not be combined with
Switched Access, not including Jointly Provided Switched
Access, on the same trunk group, i.e. Exchange Service
(EAS/Local) traffic may not be combined with Switched
Access Feature Group D traffic to a Qwest Access Tandem
Switch and/or End Office Switch.
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21"
CLEC may combine originating
Exchange Service (EAS/Local) traffic, ISP-Bound Traffic
IntraLATA LEC Toll, VoIP Traffic and Switched Access
Feature Group D traffic including Jointly Provided
Switched Access traffic, on the same Feature Group D
trunk group.
9.3.1 CLEC shall provide
Qwest, each quarter, Percent Local Use (PLU) factor(s) that
can be verified with individual call detail records or the
Parties may use call records or mechanized
jurisdictionalization using Calling Party Number (CPN)
information in lieu of PLU, if CPN is available. Where
CLEC utilizes an affiliate s Interexchange Carrier (IXC)
Feature Group D trunks to deliver Exchange Service
(EAS/Local) traffic with interexchange Switched Access
traffic to Qwest Qwest shall establish trunk group(s) to
deliver Exchange Service (EAS/Local), Transit, and
IntraLATA LEC Toll to CLEC. Qwest will use or establish
a POI for such trunk group in accordance with Section 7.
WHAT LANGUAGE IS LEVEL 3 PROPOSING?
Level 3 proposes the following language:
9.3.Where CLEC exchanges Telephone
Exchange Service Exchange Access Service Telephone
Toll Service, and Information Services traffic with Qwest
over a single interconnection network, CLEC agrees to pay
Qwest, on Qwest's side of the POI, state or federally
tariffed rates applicable to the facilities charges for
InterLA T A and/or InterLA T A traffic in proportion to the
total amount of traffic exchanged over such interconnection
facility. Otherwise each party remains 100% responsible
for the costs of its interconnection facilities on its side
the POI. Thus, by way of illustration only, where 20% of
such traffic is interLATA (intrastate and interstate) and the
remaining 80% is Section 251 (b )( 5) Traffic, CLEC would
pay Qwest an amount equal to 20% of the applicable
tariffed transport rate that would apply to a tariffed facility
used solely for the exchange of such access traffic for such
traffic exchanged on Qwest's side of the POI over a single
interconnection trunk.
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Except as expressly provided in Section 7.3.1.1.3, each
party shall bear all costs of interconnection on its side
the network in accordance with 47 C.R. ~ 51.703.
Accordingly, unless otherwise expressly authorized
according to Section 7.3.1.1.3, neither Party may charge the
other (and neither Party shall have an obligation to pay) any
recurring and/or nonrecurring fees, charges or the like
(including, without limitation, any transport charges),
associated with the exchange of any telecommunications
traffic including but not limited to Section 251 (b )( 5) Traffic
on its side of the POI.
Each party is solely responsible for any and all costs arising
from or related to establishing and maintaining the
interconnection trunks and facilities it uses to connect to
the POI. Thus, neither party shall require the other to bear
any additional costs for the establishment and operation of
interconnection facilities that connect its network to its side
of the POI. If traffic is combined, Section 7.3.9 of this
Agreement applies.
CLEC may combine Exchange Service
(EAS/Local) traffic, ISP-Bound Traffic, Exchange Access
(IntraLATA Toll carried solely by Local Exchange
Carriers), VoIP Traffic and Switched Access Feature Group
traffic including Jointly Provided Switched Access
traffic, on the same Feature Group D trunk group or overthe same interconnection trunk groups as provided in
Section 7.3.
PLEASE SUMMARIZE THE POSITIONS OF THE TWO PARTIES ON
THIS ISSUE.
As I noted previously, there are two issues here:1) compensation for LIS
trunking on the Qwest side of the POI and; 2) the types of traffic that may be
combined on LIS trunks. With regard to the first issue, Level 3 takes the position
that, with the exception of reciprocal compensation charges, it is not responsible
for any interconnection charges on the Qwest side of the POI. Qwest believes
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that it is entitled to recover the costs it incurs to provide interconnection to Level
3. These arguments were covered at length in the discussion of Issue No.1 and
need not be repeated here.
WHAT ARE THE PARTIES' POSITIONS AS TO WHAT TRAFFIC IS
ALLOWED OVER LIS TRUNKS?
Level 3 believes it should be allowed to combine all traffic, including switched
access traffic, over LIS trunks. Qwest is willing to allow all traffic types, with the
exception of switched access traffic, to be carried over LIS trunks. Qwest
requires that switched access traffic be carried over Feature Group D (FGD)
trunks.Qwest has required this since 1984 and nothing has changed this
requirement. Qwest has agreed to allow all traffic types terminating to Qwest to
be combined over FGD trunks.
THE QWEST LANGUAGE IN SECTION 7.1 ALLOWS JOINTLY
PROVIDED SWITCHED ACCESS TRAFFIC TO BE CARRIED OVER
LIS TRUNKS.WHAT IS THE INTENT OF ALLOWING JOINTLY
PROVIDED SWITCHED ACCESS TRAFFIC TO BE CARRIED OVER
LIS TRUNKS?
Because IXCs generally connect at the Qwest access tandem rather than directly
to the CLEC, this language, which appears in all of Qwest's SGATs, is needed to
allow traffic to and from a CLEC end user s Presubscribed Interexchange Carrier
PIC") to be carried over LIS trunks. Thus, CLEC end users are able to reach
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their Presubscribed Interexchange Carriers and the IXCs are able to get calls to
CLEC end users. This traffic is referred to as Jointly Provided Switched Access
because both Qwest and the CLEC are involved in providing access to the IXC.
IS QWEST REQUIRED TO COMBINE SWITCHED ACCESS ON LIS
TRUNKS?
No. Qwest has no obligation to permit Level 3 to commingle switched access
traffic with other types of traffic on the interconnection trunks created under the
Agreement.In fact, Qwest is required to provide interconnection for the
exchange of switched access traffic in the same manner that it provided
interconnection for such traffic prior to passage of the Act. Section 251 (g) of the
Act specifically provides:
On and after February 8, 1996, each local exchange carrier
to the extent that it provides wireline services, shall provide
exchange access information access, and exchange
services for such access to interexchange carriers and
information service providers in accordance with the same
equal access and nondiscriminatory interconnection
restrictions and obligations (including receipt of
compensation) that apply to such carrier on the date
immediately preceding February 8, 1996, under any court
order, consent decree, or regulation or policy of the
Commission, until such restrictions and obligations are
explicitly superseded by regulations prescribed by the
Commission after February 8 , 1996.
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(Emphasis added). As the FCC has stated
, "
(p Jursuant to section 251 (g), LECs
must continue to offer tariffed interstate access services just as they did prior to
the enactment of the 1996 Act."s
Nothing in the Act or the FCC's regulations give Level 3 the right to mix
switched access traffic with local traffic over the local interconnection trunks
between its network and Qwest's established pursuant to section 251(c)(2) of the
Act.The Act and the FCC'regulations interpreting the Act speak to
interconnection at any technically feasible point within the incumbent LEC'
network "6 but this instruction clearly does not apply to traffic carried by Level 3
between LA T As or between local calling areas. Any other interpretation would
undermine Qwest's switched access tariffs.
DOES LEVEL 3'S OFFER TO PAY QWEST STATE AND FEDERAL
TARIFF RATES FOR INTERLATA TRAFFIC IN PROPORTION TO
THE TOTAL AMOUNT OF TRAFFIC GOING OVER THE LIS TRUNK
SATISFY THE REQUIREMENTS OF 251(g)?
No. Level 3's proposal would only allow Qwest to assess a per minute of use
charge on switched access traffic. Qwest would still be denied the non-recurring
charges and recurring non-traffic sensitive charges that are a part of FGD charges.
Local Competition Order ~1 034.
47 C.R. 951.305(a)(2).
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These are charges that are contained in Qwest' s access tariffs and are charges that
all IXCs are required to pay.
ARE THERE OTHER PROBLEMS WITH THE LEVEL 3 PROPOSAL?
Yes. The Level 3 proposal creates serious recording and billing issues as well as
issues related to the intercarrier exchange of jointly provided switched access
records.
WHAT ARE THE BILLING ISSUES THE LEVEL 3 PROPOSAL
PRESENTS?
Today, IXCs are required to route all inter LATA switched access traffic and
intraLATA switched access traffic over FGD.Qwest's mechanized billing
systems are able to use the actual traffic information recorded by its end office
switch from the FGD trunks, allowing Qwest to accurately and efficiently produce
switched access bills. The Level 3 proposal, on the other hand, would rely on
factors, not recordings of actual traffic information, and would not allow Qwest to
use its existing mechanized billing processes. In fact, implementing the Level 3
proposal would require investment and significant reworking of Qwest systems
and processes, forcing Qwest to expend significant resources to meet the special
needs of one carrier.
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WHAT ARE THE PROBLEMS RELATED TO THE EXCHANGE OF
SWITCHED ACCESS RECORDS YOU MENTIONED EARLIER?
The undisputed language in Section 7.2.4 of the agreement requires the parties
to use industry standards developed to handle the provisioning and billing of
Jointly Provided Switched Access. Under these standards, Qwest is required to
provide industry standard jointly provided switched access records to LECs
WSPs and CLECs when Qwest transports and switches jointly provided switched
access traffic.Today these records are produced mechanically, using the
information recorded on the FGD trunks. Level 3' s use of billing factors would
not allow Qwest to provide the industry standard records to the terminating LEC,
wireless service providers (WSPs) or CLEC carriers. If Qwest does not record
this traffic as FGD, neither Qwest nor the collaborating LEC, CLEC or WSP can
bill the IXC who originated the call. In addition, if one of these IXC calls that
Level 3 is requesting to route over LIS were routed on to another CLEC, ILEC or
WSP, Qwest could potentially get billed for switched access or re~iprocal
compensation for a call that really originated with an IXC, as Qwest would be
unable to provide the appropriate jointly provided switched access record to the
CLEC, ILEC or WSP.
IS QWEST IN A POSITION TO AGREE TO A PROPOSAL THAT WILL
IMPACT OTHER LECS AND CLECS?
No.Even if Qwest were willing to agree to use factors for the traffic it
terminates Qwest cannot agree to a proposal that will impact all ILECs and
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CLECs that today rely on Qwest to provide them with a jointly provided switched
access record. Without the switched access records they are receiving today,
these companies, too, would have to change their systems and processes for
billing their portion of switched access to the IXC.
HOW DO YOU RESPOND TO LEVEL 3'S ARGUMENTS THAT
COMBINING ALL TRAFFIC OVER A SINGLE TRUNK GROUP IS
MORE EFFICIENT?
Qwest has offered Level 3 an approach that will allow the network efficiencies
that Level 3 is seeking. Qwest's proposed language for section 7.2 offers
Level 3 the capability to combine all traffic over a FGD trunk group. Combining
all of the traffic over FGD not only allows for the efficiencies Level 3 claims to
need, it also allows for mechanized billing of the appropriate tariffed rates and the
ability to produce the necessary jointly provided switched access records. There
is simply no reason to grapple with the difficulties inherent in Level 3' s proposal
when a workable solution to combining all traffic on a single trunk group already
exists.
HAS QWEST ALLOWED OTHER CARRIERS TO USE LIS TRUNKS IN
THE MANNER THAT LEVEL 3 IS PROPOSING HERE?
No. All CLECs interconnected with Qwest have Interconnection Agreements that
either provide for the segregation of traffic onto separate trunk groups, or the
combining of terminating traffic onto a FGD trunk group. There is simply no
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valid reason to give Level 3 special treatment that would cause great expense and
disruption for Qwest and other carriers.
DISPUTED ISSUE NO.5: SHOULD INTERCONNECTION TERMS BE
INCORPORATED BY REFERENCE
PLEASE EXPLAIN THE NATURE OF THE DISPUTE AROUND THIS
ISSUE.
Level 3 alleges that Qwest's proposed interconnection agreement attempts to
incorporate, by reference, certain state Statement of Generally Available Terms
(SGA T) terms and conditions.
QWEST'ATTEMPTDOESPROPOSEDAGREEMENT
INCORPORATE SGAT TERMS AND CONDITIONS?
No. Level 3 has misinterpreted the cross-references that Qwest included in its
template interconnection agreement, which was used as a basis for negotiations.
The SGA T references in the template agreement signify that a commission has
approved state-specific language that is different than the generic language used
in the fourteen state template. Thus, for example, the state commissions in
Colorado, Minnesota and South Dakota have each prescribed language for
Section 5.1 in the fourteen state template. Qwest's intent in referencing the
state SGA Ts in the template was to signify that the state specific language was to
be substituted for the template language in those cases. The interconnection
agreement that was submitted with Qwest's response in this docket contains the
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state specific language that Qwest proposes and contains no cross-references to
the SGAT. Hopefully Qwest'clarification and the proposed state specific
interconnection agreement will allow the parties to close this issue.
VI.DISPUTED ISSUE NO. 13: LOCAL INTERCONNECTION SERVICE
DE FINITI 0 N
PLEASE DESCRIBE ISSUE NO. 13.
Issue No. 13 relates to the definition of local interconnection service.
WHAT QWEST'PROPOSED DEFINITION FOR LOCAL
INTERCONNECTION SERVICE?
Qwest proposes the following definition on page 23 of the ICA:
Local Interconnection Service or "LIS" Entrance
Facility is a DS 1 or DS3 facility that extends from
CLEC's Switch location or Point of Interconnection (POI)
to the Qwest Serving Wire Center. An Entrance Facility
may not extend beyond the area served by the Qwest
Serving Wire Center.
WHAT IS LEVEL 3'S DEFINITION
Level 3 objects to Qwest's definition but fails to provide a definition of its own.
WHAT IS THE BASIS OF LEVEL 3'S OBJECTION?
Level 3 claims that the Qwest definition shifts the cost of Qwest's network to
Level 3.
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DO YOU AGREE?
No. The definition of "Local Interconnection Service or 'LIS' Entrance Facility
is nothing more than a definition of the facility that connects Qwest's network to
Level 3' s network. The definition does not contain any language that determines
who bears the cost of this facility. Level 3 provides no legitimate reason for
rejecting this definition. Level 3's concern about the allocation of the costs
interconnection is addressed in Issue No. 1G. As I explained in the discussion of
issue 1G, Level 3 has the option of using a Mid-Span Meet POI or collocation for
interconnection rather than an entrance facility. These options would allow Level
3 to avoid compensating Qwest for an entrance facility on the Qwest side of the
POI.
VII.DISPUTED ISSUE NO. 17: TRUNK FORECASTING
PLEASE EXPLAIN ISSUE NO 17.
Issue 17 has to do with Section 7.8 of the agreement, which discusses LIS
forecasting. Level 3 and Qwest have been unable to reach agreement on the LIS
forecasting language. In an attempt to settle this issue, Qwest is now proposing
different language from what was filed by Qwest with its Response to Petition for
Arbitration.
WHAT LANGUAGE IS QWEST NOW PROPOSING?
Qwest is proposing the following language:
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8.4 The Parties agree that trunk forecasts are
non-binding and are based on the information available to
each respective Party at the time the forecasts are prepared.
Unforecasted trunk demands, if any, by one Party will be
accommodated by the other Party as soon as practicable
based on facility availability. Switch capacity growth
requiring the addition of new switching modules may
require six (6) months to order and install.
In the event of a dispute regarding forecast
quantities, where in each of the preceding eighteen (18)
months, trunks required is less than fifty percent (50%) of
forecast, Qwest will make capacity available in accordance
with the lower forecast.
This language replaces the language contained in sections 7.8.4, 7.
, 7.1 and 7.2 in Qwest's previously filed interconnection
agreement.
WHY HAS QWEST CHANGED ITS PROPOSED LANGUAGE FROM
WHAT WAS PROPOSED PREVIOUSLY?
One ofLevel3's concerns with Qwest's original language was the requirement of
a deposit to construct trunks to forecasted levels when previous forecasts did not
match subsequent requirements.Qwest has now removed the deposit
requirement.
DOES LEVEL 3 OBJECT TO THE NEW QWEST LANGUAGE?
Although Qwest has offered Level 3 the new language, Level 3 has not yet
informed Qwest if the revisions are acceptable or proposed new language.
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WHY DOES QWEST FEEL THAT THE NEWLY PROPOSED
LANGUAGE IS NECESSARY?
LIS forecasting serves the interest of both parties by helping to ensure that
adequate capacity is made available to allow for the exchange of traffic between
the parties. As a result, it is important that the interconnection agreement detail
how the forecasts are developed and used.
WHY IS QWEST PROPOSING TO BUILD TO A LOWER FORECAST
WHERE REQUIRED LEVELS HAVE BEEN LESS THAN FORECAST IN
PREVIOUS MONTHS?
In many instances, making capacity available at forecasted levels will require
Qwest to construct new facilities and thereby incur substantial expense. Once a
CLEC submits its forecast, however, it has no obligation to order interconnection
trunks consistent with its forecast. This could leave Qwest in the unacceptable
position of having incurred cost to build new facilities, which then lay
underutilized, or worse, dormant or dark. To avoid this situation, Qwest reserves
the right to adjust the forecast downward based on the relationship between
ordered trunks and forecasted trunks in previous months. This provides the
appropriate incentive to the forecasting party and allows Qwest to avoid making
needless investments.
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VIII. DISPUTED ISSUE NO. 18: JURISDICTIONAL ALLOCATION FACTORS
PLEASE EXPLAIN ISSUE NO. 18.
Issue 18 concerns jurisdictional allocation factors for billing purposes. Level3'
proposed language introduces several new jurisdictional allocation factors which
Qwest opposes.
WHAT LANGUAGE IS QWEST PROPOSING FOR SECTION 7.
Qwest is proposing the following language on pages 89-90:
7.3.To the extent a Party combines Exchange Service
(EAS/Local), IntraLATA LEC Toll, and Jointly Provided
Switched Access (InterLA T A and IntraLA T A calls
exchanged with a third party IXC) traffic on a single LIS
trunk group, the originating Party, at the terminating
Party s request will declare quarterly PLU(s). Such PLUs
will be verifiable with either call summary records utilizing
Calling Party Number information for jurisdictionalization
or call detail samples. The terminating Party should
apportion per minute of use (MOD) charges appropriately.
UNDER THE QWEST PROPOSED LANGUAGE, HOW IS THE
PERCENT LOCAL USAGE (PL U) FACTOR USED?
Traffic that does not contain a calling party number cannot be jurisdictionalized
based on a comparison of the calling and called parties' numbers. In these
situations, the PLU is applied to the bucket of these "unidentified" calls to
determine what percent should be billed at the local rate.
WHAT LANGUAGE IS LEVEL 3 PROPOSING?
Level 3 proposes the following:
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7.3.To the extent a Party combines Section 251(b)(5)
Traffic and Jointly Provided Switched Access (InterLATA
and IntraLA T A calls exchanged with a third party IXC)
traffic on a single trunk group, the originating Party, at the
terminating Party s request will declare monthly PLU(s)
PIU(s), and PIPU(s), collectively "Jurisdictional Factors.
Such Jurisdictional Factors will be verifiable with either
call summary records utilizing Call Record information for
jurisdictionalization or call detail samples. The terminating
Party should apportion per minute of use (MOD) charges
appropriately.
7.3.1 The Jurisdictional Factors - PLU, PIU and
PIPU - are defined as follows:
7.3.1.1 PIPU - Percent IP Usage:
This factor represents the traffic that is IP Enabled as a
percentage of ALL traffic. CLEC has introduced this factor
to identify IP-Enabled Services traffic for billing purposes
to Qwest on an interim basis until an industry standard is
implemented. IP-Enabled traffic includes all IP- TDM and
TDM to IP traffic that is exchanged directly between the
parties.
7.3.1.2 PIU - Percent Interstate
Usage: This factor represents the end-to-end circuit
switched traffic (i.e. TDM-IP-TDM) that is interstate for
services that are billed at tariffed rates on a per Minute Of
Use (MOU) basis as a percentage of all end-to-end circuit
switched traffic e. all interstate traffic after IP-Enabled
traffic has been excluded. This factor does not include IP-
Enabled Services Traffic.
1.3 PLU - Percent 251 (b )( 5)
Usage: This factor represents the end-to-end circuit
switched 251(b)(5) traffic as a percentage of all end-to-end
circuit switched intrastate traffic. This factor distinguishes
traffic that is rated as "local" (i.e. "Section 251(b)(5)
traffic ) from Intrastate toll traffic. This factor does not
include IP- Enabled Services traffic.
7.3.2 Unless otherwise agreed to by the parties:
(1) factors will be calculated and exchanged on a monthly
basis. Percentages will be calculated to two decimal places
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(for example 22.34%); (2) each party will calculate factors
for all traffic that they originate and exchanged directly
with the other Party; and (3) the party responsible for
collecting data will collect all traffic data, including but not
limited to Call Detail Records (this includes CPN), from
each trunk group in the state over which the parties
exchange traffic during each study period. The parties will
calculate the factors defined in Section 7., above, as
follows:
7.3.PIPU: The PIPU is calculated
by dividing the total IP- Enabled Services MOU by the total
MOU. The PIPU is calculated on a statewide basis.
7.3.1.1 Upon ILEC request
CLEC will provide a PIPU factor for all minutes of usage
exchanged directly between the Parties over the
Interconnection Trunk Groups in each state. CLEC will
provide separate PIPU factors for CLEC Terminating IP-
enabled Traffic and CLEC Originating IP-enabled Traffic
which terms are defined in sections 7.8.4.3.1.1 and
8.4.3.1.2, respectively, below. Accordingly, the PIPU
factor is based upon CLEC's actual and verifiable Call
Detail Records of IP-originated traffic
7.3.3 Exchange of Data:
7.3.9.3.The party responsible for
billing will prov~de the PIPU, PLU and Pill factors to the
non-collecting party on or before the 15th of each month
via email (or other method as mutually agreed between the
parties), to designated points of contact within each
company.
7.3.9.4 Maintenance of Records
7.3.9.4.1 Each company will maintain
traffic data on a readily available basis for a minimum
period of one year (or however long as required by state
and federal regulations) after the end of the month for
which such date was collected for audit purposes.
7.3.5 Audits
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7.3.Each company will have the
ability to audit the other company s traffic factors up to a
maximum of twice per year. A party seeking audit must
provide notice of their intent to audit and include specific
dates amounts and other detail necessary for the party
receiving the request to process the audit. Notice must be
provided in writing and postmarked as mailed to the
audited party within one year after the end of each month(s)
for which they seek audit.
The audited party must
provide in a mutually agreeable electronic format traffic
data for the months requested according to Section
5.1 above.
7.3.6 True-
In addition to rights of audit, the Parties agree that where a
factor is found to be in error by more than 2%, they will
automatically true up the factors and pay or remit the
resulting amounts to correct such errors.
WHY IS QWEST OPPOSED TO LEVEL 3'S PROPOSED FACTORS?
The only reason for introducing these factors is to allow for billing when switched
access traffic is commingled with all other traffic on a LIS trunk group. As was
noted in the discussion of Issue No., these factors would not be necessary if
switched access traffic were carried over a FGD trunk group, as opposed to a LIS
trunk group. There is simply no reason to go to a system of factors and the
difficulties they present, when a workable solution to combining all traffic on a
single trunk group already exists. In addition, the existing FGD solution is
superior to Level 3' s proposal in that it relies on actual traffic information to
determine accurate jurisdiction of recorded calls, not estimates which may, or
may not, be accurate and at the very least will require continual updating.
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Further, as there is no industry standard method of determining IP-enabled
services at this time, the PIPU factor proposed by Level 3 is unverifiable by
Qwest, and includes traffic that does not conform to the definition of VoIP
proposed by Qwest and discussed in Mr. Brotherson s testimony. Finally, as
discussed previously, the system of factors proposed by Level 3 does not allow
for the creation of jointly provided access records which are relied upon by
CLECs and LECs who terminate jointly provided switched access traffic.
IX.DISPUTED ISSUE NO. 21: ORDERING OF INTERCONNECTION
TRUNKS
PLEASE EXPLAIN THE NATURE OF THE DISPUTE AROUND THIS
ISSUE.
Issue No. 21 concerns language that Level 3 is attempting to insert in section 7.4
of the agreement which discusses the ordering of local interconnection service.
WHAT LANGUAGE IS LEVEL 3 PROPOSING?
Level 3 is proposing to insert the following language into Section 7.4, page 91 of
the ICA:
7.4.1.1 Nothing in this section 7.4 shall be construed to in
any way affect the Parties' respective obligations to pay
each other for any activities or functions under this
Agreement. All references in this section 7.4 to 'ordering
shall be construed to refer only to the administrative
processes needed to establish interconnection and trunking
arrangements and shall have no effect on either Party
financial obligations to the other.
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WHY QWEST OPPOSED TO THE INSERTION OF THIS
LANGUAGE?
In addition to the fact that Qwest disagrees with Level 3' s contention that it has
no financial obligation on Qwest's side of the POI, Level 3's language
misplaced. Section 7.4 of the agreement has to do with the ordering of local
interconnection service and does not address allocation of responsibility for the
cost of interconnection.
Level 3's proposed Section 7.4.1.1 only underscores why its position on
allocation of the costs' of interconnection is wrong. The fact that Level 3 requests
(or orders) facilities on Qwest's side of the network demonstrates that the
interconnection is done for Level 3's benefit. Level 3 makes requests for Qwest
facilities on Qwest's side of the point of interconnection so that Level 3 can serve
its own ISP customers.
Section 7.4.1 is simply unnecessary. The Commission will determine who pays
the costs of interconnection in the Sections of the Agreement that are related to
Issue No.1. Accordingly, since nothing in Section 7.4 requires Level 3 to pay
interconnection costs, Level 3' s proposed Section 7.4.1 should be rej ected.
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DISPUTED ISSUE NO. 22: COMPENSATION FOR SPECIAL
CONSTRUCTION
PLEASE EXPLAIN ISSUE NO. 22.
Issue 22 has to do with construction charges and whether Level 3 is responsible
for charges related to special construction that it requests on the Qwest side of the
POI. Level 3 proposes to insert language stating that it has no obligation for
construction on the Qwest side of the POI.
WHAT IS THE LANGUAGE THAT LEVEL 3 PROPOSES TO INSERT?
Level 3 proposes to insert the following language on page 299 of the ICA:
19.1.1. Nothing in this section 19 shall be construed to in
any way affect the Parties' respective obligations to pay
each other for any activities or functions under this
Agreement. All references in this section 19
construction charges be construed to refer only to those
Level 3 requests for construction that are outside the scope
of what is needed to establish interconnection and trunking
arrangements and shall have no effect on either Party
financial obligations to the other.
WHY IS QWEST OPPOSED TO THIS LANGUAGE?
Level 3' s proposed language again underscores the unreasonableness of Level 3'
position that it should not have to pay any of the interconnection costs Qwest
incurs on its side of the point of interconnection. When Level 3 requests that
Qwest build additional facilities for network interconnection, these costs are
incurred to benefit Level 3 and Level 3' s ISP end users. If Level 3 and its ISP
end users are benefiting by the additional cost for building facilities, Level 3, not
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Qwest, should bear that cost. Under the Act Qwest is entitled to just and
reasonable compensation for the costs it incurs.
XI.SUMMARY/CONCLUSION
PLEASE SUMMARIZE YOUR TESTIMONY.
Despite the long list of issues, subparts and dueling language discussed in this
testimony, ultimately everything can be boiled down to just two issues: 1)
compensation for interconnection services provided by Qwest and; 2) the types of
traffic that may be combined on interconnection trunks.
The law is very clear when it comes to compensation for the interconnection
services Qwest provides. Under the Telecommunications Act of 1996, Qwest has
a duty to provide interconnection with its local exchange network "on rates, terms
and conditions that are just, reasonable, and nondiscriminatory" and in accordance
with the requirements of Section 252 of the Act.7 Section 252 of the Act in turn
provides that determinations by a state commission of the just and reasonable rate
for the interconnection shall be "based on the cost.. .of providing the
interconnection
" "
nondiscriminatory" and "may include a reasonable pro fit. ,,8
Despite the law, and despite the fact that Level 3 is ordering interconnection
services so that it can serve its customers, Level 3 boldly claims that it has no
7 47 V.C. ~251(c)(2)(D).
47 V.C. ~252(d)(I)
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obligation to compensate Qwest for these services. This assertion is unreasonable
and should be soundly rejected by this Commission.
As to the types of traffic that can be carried on interconnection trunk groups
Qwest has attempted to be responsive to Level 3' s desire to combine traffic on
trunk groups. Qwest is willing to allow all traffic types, with the exception of
switched access traffic, to be carried over LIS trunks. Because of billing issues
systems issues and Qwest obligation to provide jointly provided switched access
records to other ILECs, CLECs and WSPs, Qwest requires that switched access
traffic be carried over Feature Group trunks. This is entirely consistent with
Section 251 (g) of the Act, which requires that Qwest provide interconnection for
the exchange of switched access traffic in the same manner that it provided for
such traffic prior to the passage of the Act. Nonetheless, Qwest has attempted to
accommodate Level 3' s desire for network efficiencies by agreeing to let Level 3
combine all of its traffic over Feature Group D trunks. This solution achieves the
efficiencies sought by Level 3 while at the same time allowing Qwest to continue
to use its existing billing systems and processes. For these reasons, Level 3'
proposed combining of traffic on LIS trunks should be rejected.
DOES THIS CONCLUDE YOUR TESTIMONY?
Yes it does.
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CERTIFICATE OF SERVICE
I do hereby certify that a true and correct copy of the foregoing DIRECT TESTIMONY OF
WILLIAM R. EASTON was served on the 12th day of August, 2005 by first class mail, postage prepaid on
the following individuals:
Jean Jewell, Secretary Hand DeliveryIdaho Public Utilities Commission U. S. Mail
472 West Washington Street Overnight DeliveryO. Box 83720 Facsimile
Boise, ill 83720-0074 Email
11 ewell~puc. state. id. us
Weldon Stutzman
Idaho Public Utilities Commission
472 West Washington Street
O. Box 83720
Boise, ill 83720-0074
Telephone: [phone]
we Idon.stutzmanCfYpuc. Idaho .gOY
Erik Cecil
Regulatory Counsel
Level 3 Communications, LLC
1025 Eldorado Boulevard
Broomfield, CO 80021
erik.cecil~leYe13 .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, ill 83702
joe~mcdevitt-miller.com
Hand Delivery
U. S. Mail
Overnight Delivery
Facsimile
Email
Hand Delivery
U. S. Mail
Overnight Delivery
Facsimile
Email
Hand Delivery
U. S. Mail
Overnight Delivery
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Email
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U. S. Mail
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Email
1fvkzY:lL
Brandi L. Gearhart
Legal Assistant
Stoel Rives LLP