20100622Boise Vol I.pdf

ORIGINAL
e BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF TIME WARNER CABLE INFORMATION
SERVICES (IDAHO), LLC, FOR A
CERTIFICATE OF PUBLIC CONVENIENCE
AND NECESSITY TO PROVIDE LOCAL
EXCHANGE AND INTEREXCHANGE
TELECOMMUNICATIONS SERVICES
WITHIN THE STATE OF IDAHO
CASE NO.
TIM-T-08-01
HEARING BEFORE
-COMMISSIONER MARSHA H. SMITH (Presiding)
COMMISSIONER JIM D. KEMPTON
COMMISSIONER MACK A REDFORD
PLACE:Commission Hearing Room
472 West Washington Street
Boise, Idaho
DATE:June 10, 2010
VOLUME I - Pages 1 - 90
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2 For the Staff:
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5 For TWCIS:
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APPEARANCES
NEIL PRICE, Esq.
Deputy Attorney General
472 West Washington
Boise, Idaho 83702
BATT FISHER PUSCH & ALDERMAN, LLP
by JOHN R. HAMMOND, JR., Esq.
101 South Capitol Boulevard,
Suite 500
Boise, Idaho 83702
HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
APPEARANCES
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WITNESS EXAMINATION BY PAGE
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Julie Laine Mr.Hammond (Direct)3
4 (TWCIS)Prefiled Direct 6
Prefiled Rebuttal 14
5 Mr.Price (Cross)20
Commissioner Kempton 38
6 Commissioner Smith 44
Commissioner Kempton 49
7 Mr.Hammond (Redirect)50
8 Grace Seaman Mr.Price (Direct)52
(Staff)Prefiled Direct 55
9 Mr.Hammond (Cross)68
Commissioner Kempton 74
10 Commissioner Smith 75
Mr.Price (Redirect)76
11 Mr.Hammond (Recross)82
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16 EXHIBITS
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NUMBER PAGE
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19 For TWCIS:
20 A.4/29/10 Letter,Miles to Swan,6 pgs Premarked
Admitted 89
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
INDEX
EXHIBITS
e 1 BOISE, IDAHO, THURSDAY, JUNE 10,2010, 9:31 A.M.
2
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4 COMMISSIONER SMITH: Good morning, ladies and
5 gentlemen. This is the time and place set for a hearing on
6 reconsideration before the Idaho Public Utili ties Commission in
7 Case No. TIM-T-08-01, further identified as In the matter of
8 the Application of Time Warner Cable Information Services
9 (Idaho), LLC, for a Certificate of Public Convenience and
10 Necessi ty to provide local exchange and interexchange
11 telecommunications services wi thin the state of Idaho.
12 I think we have two parties. Mr. Hammond, would
e 13 you like to make an appearance for the Applicant?
14 MR. HAMMOND: Yes, Commissioner Smith. My name
15 is John Hammond, an attorney --
16 COMMISSIONER SMITH: We will have our microphone
17 directions early in the proceeding.
18 MR. HAMMOND: Oh, sorry.
19 My name is John Hammond. 11m an attorney at
20 Batt, Fisher, Pusch & Alderman. Our firm represents, as well
21 Counsel, Time Warner Cable Information Services of Idaho. And
22 wi th me today are Julie Laine and Vincent Paladini from the
23 Company, both attorneys.
24 And if you would like to introduce yourself,
e 25 certainly.
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
COLLOQUY
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1 MS. LAINE: I i m Julie Laine with Time Warner
2 Cable -- Time Warner Cable Information Services (Idaho).
3 MR. PALADINI: And I 1m Vin Paladini with the
4 same.
5 COMMISSIONER SMITH: Thank you.
6 And for the Staff.
7 MR. PRICE: Good morning, Madam Chair. My name
8 is Neil Price. I represent Commission Staff. With me is
9 Staffperson Grace Seaman and also Joe Cusick.
10 COMMISSIONER SMITH: Thank you. For those of you
11 who may not know the Commission, my name is Marsha Smith. 11m
12 one of the three Commissioners. I i 11 chair today i shearing.
13 On my left is Commissioner Jim Kempton, who is
14 president of the Commission, and on my right is Commissioner
15 Mack Redford. The three of us are the Idaho Commission.
16 So, are there any preliminary matters to come
17 before the Commission before we begin the testimony?
18 MR. PRICE: Nothing from Staff.
19 COMMISSIONER SMITH: Okay.
20 MR. HAMMOND: No.
21 COMMISSIONER SMITH: All right, Mr. Hammond, we
22 are ready to start with your witnesses.
23 MR. HAMMOND: We would call Julie Laine.
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
COLLOQUY
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1 JULIE LAINE,
2 produced as a witness at the instance of Time Warner Cable
3 Information Services (Idaho), LLC, being first duly sworn, was
4 examined and testified as follows:
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6 DIRECT EXAMINATION
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8 BY MR. HAMMOND:
9 Can you please state your name and spell yourQ.
10 last name for the record?
11 Sure. My name is Julie Laine, L-A- I -N-E.A.
12 Can you tell me where you are employed?Q.
13 1'm employed by Time Warner Cable in New York,A.
14 New York.
15 Q.And in what position?
16 11m group vice president and chief counsel forA.
17 regulatory.
18 And in that position, do you have opportunity toQ.
19 or are you working with Time Warner Cable Information Services
20 of Idaho?
21 A.Yes, I am.
22 What are -- what is your educational background,Q.
23 could you briefly sum that up for us?
24 Sure. I attended the Uni versi ty of PennsylvaniaA.
25 and received an undergraduate bachelor i s degree.
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
LAINE (Di)
TWCIS
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1 And then received a j uris doctorate degree at the
2 College of William and Mary.
3 How long have you been employed at Time Warner?Q.
4 Eight and a half years at Time Warner Cable.A.
5 Have you had an opportunity to participate inQ.
6 this case that i s before the Commission: Time Warner Cable
7 Information Services i Application for a CPCN?
8 Yes, and I submitted some testimony and a MotionA.
9 for Reconsideration.
10 Did you submit -- in that light, did you submitQ.
11 direct testimony and rebuttal testimony?
12 A.I did.
13 And in that testimony, did you -- are there anyQ.
14 addi tions or corrections to that testimony that you have caused
15 to be prepared?
16 I have no additions or corrections.A.
17 MR. HAMMOND: Commissioners, I would ask that the
18 testimony of Ms. Julie Laine be spread upon the record as if
19 fully read.
20 COMMISSIONER SMITH: Okay. Would the prefiled
21 direct testimony of Julie Laine consisting of eight pages and
22 the rebuttal -- the prefiled rebuttal testimony of Julie Laine
23 consisting of six pages will be spread upon the record as if
24 read, if there is no objection.
25 MR. PRICE: No objection.
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
LAINE (Di)
TWCIS
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1 MR. HAMMOND: And with that --
2 COMMISSIONER SMITH: So ordered.
3 (The following prefiled direct and
4 rebuttal testimony of Ms. Laine is spread upon the record.)
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HEDRICK COURT REPORTING
P. O. BOX 578, BOISE, ID 83701
LAINE (Di)
TWCIS
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PLEASE STATE YOUR NAME, TITLE, AN BUSINESS ADDRESS FOR THE
RECORD.
My name is Julie Laine and I am Group Vice President, Regulatory of Time Warner
Cable. My business address is 60 Columbus Circle, New York, NY 10023. My
telephone number is [phone] and my email address is julie.laine(Ðtwcable.com.
WHAT AR YOUR JOB RESPONSIBILITIES?
I am responsible for legal and regulatory matters relating to Time Warner Cable's voice,
video, and data services.
PLEASE GIVE A BRIEF DESCRIPTION OF YOUR BACKGROUN AN
EXPERIENCE.
I am an attorney who has specialized in the area of communications. I began my law
career as a law clerk in the U.S. District Court for the District of New Jersey and later
served as an Adjunct Professor at the Seton Hall Law SchooL. I then practiced
communications law in private practice in Washington, D.C. for several years. I later
served as an Attorney Advisor in the Policy Division of the Federal Communications
Commission's Common Carier Bureau, where I worked on issues relating to local
telephone competition, broadband deployment, and telecommunications mergers. I
joined Time Warer Cable in 2002 after working for Net2Phone, Inc., an IP telephony
provider, where I was Associate General CounseL. Prior to becoming Time Warer
Cable's Group Vice President, Regulatory, I was Vice President and Chief Counsel,
Telephony. I received my undergraduate degree from the University of Pennsylvania and
my law degree from the College of William & Mary. I am a recent graduate of the Betsy
Magness Leadership Institute, Women in Cable Telecommunications' flagship executive
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development program that provides intensive, yearlong training for senior-level women
ready to take on significant leadership responsibilities.
PLEASE BRIEFLY DESCRIBE YOUR COMPANY'S CORPORATE STRUCTURE.
Time Warner Cable Information Services (Idaho), LLC ("TWCIS") is a limited liability
company organized under the laws of the State of Delaware. TWCIS is a wholly owned,
indirect subsidiary of Time Warer Cable Inc. ("TWC").
DOES TIME WARR CABLE INC. HAVE OTHER SUBSIDIARIS OUTSIDE
IDAHO THAT OPERATE AS CERTIFICATED COMPETITIVE LOCAL
EXCHANGE CARIERS AND OFFER TELECOMMUNICATIONS SERVICES
COMPARLE TO THOSE THAT TWCIS SEEKS TO INTRODUCE?
Yes. Time Warner Cable indirectly controls 26 competitive local exchange carrers (i.e.,
one in each of 26 different states) that have obtained a certificate of public convenience
and necessity ("CPCN") or an equivalent grant of authority to operate as a local exchange
carer from the relevant state commission. Those competitive local exchange carrers
obtained such operating authority on the basis of the same types of local
telecommunications services that TWCIS proposes to provide in Idaho. TWCIS also
indirectly controls a subsidiary that has applied for such authority in Ilinois, again on the
basis of the same types of local telecommunications services that TWCIS proposes to
provide in Idaho.
AR YOU FAMILIAR WITH THE APPLICA TION TIME WARER CABLE
INORMATION SERVICES (IDAHO), LLC SUBMITTED TO THIS COMMISSION?
Yes.
WHAT IS THE PUROSE OF YOUR TESTIMONY?
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A.The purpose of my testimony is to present evidence concerning TWCIS' s application for
a CPCN to provide local telecommunications service and intrastate toll service in Idaho,
to explain that granting the application would benefit the public interest and be consistent
with Idaho state law and policy, and to describe why TWCIS would be unable to enter
the Idaho market, or offer a competitive alternative to entrenched ILEC services, in the
absence ofa CPCN.
PLEASE DESCRIE THE SERVICES THAT TWCIS PROPOSES TO PROVIDE IN
IDAHO.
TWCIS will provide competitive, facilities-based wholesale and retail local intrastate
telecommunications services for compensation within the State of Idaho. Such services
may include point-to-point, private line, access, interconnection and transport services.
In particular, TWCIS's Local Interconnection Service will enable two-way
interconnection between the facilities of TWCIS's customers and the public switched
telephone network ("PSTN"). This service will be offered on a wholesale basis to
facilities-based providers of interconnected VoIP services, and will provide for, among
other things, two-way interactive switched voice communications that will be transported
and terminated in Idaho. Local Interconnection Service also wil provide TWCIS's
interconnected VoIP provider customers with access to domestic and international toll
services, operator services, telephone number resources, 911 calling, and related services
and features.
Q.DOES TWCIS QUALIFY AS A "TELEPHONE CORPORATION" UNDER IDAHO
STATE LAW?
Yes. TWCIS's Local Interconnection Service, in addition to the other services TWCIS
intends to offer in Idaho, falls within the statutory definition of "telecommunication
service" under the Idaho Code. Thus, TWCIS is a "telephone corporation" as defined by
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Idaho law. Further, TWCIS's Local Interconnection Service should be classified as a
"basic local exchange service" under Idaho Code § 62-603(1). Therefore, to the extent
that Title 61 requires the actual provision of basic local exchange service at the time a
CPCN is granted-a point that that TWCIS does not concede- TWCIS has satisfied that
requirement.
Q. HAS THE COMMISSION PREVIOUSLY GRATED CPCNS TO OTHER
APPLICANTS THAT PROPOSED TO OFFER SERVICES COMPARLE TO
THOSE PROPOSED BY TWCIS?
A. Yes. The Commission has done so on several occasions. For example, in its application
for a CPCN, ALEC Telecom, Inc. ("ALEC") proposed to offer "wholesale switching and
interconnection services to other telephone service providers and similarly-positioned
wholesale business customers."¡ The Commission granted ALEC's request for a CPCN.
Similarly, in its application for a CPCN, Eltopia Communications, LLC ("Eltopia")
represented that it would primarily provide high-speed data services and protocol
conversion services that did not require certification.2 Yet the Commission granted
Eltopia's application after noting that Eltopia had the capability to provide both voice and
data services over the same trunk, and recognizing the company's desire to maintain the
flexibility to configure its service according to its customers' specifications.3 While Staff
has attempted to distinguish these applications from that submitted by TWCIS, the fact
remains that, immediately following certification, ALEC and Eltopia provided the same
1 See Application of ALEC Telecom, Inc. for a Certifcate of Public Convenience and
Necessity to Provide Local Exchange and Telecommunications Services, Case No. ALE-
T-09-01, Order No. 30944, at 4-5 (Nov. 13,2009).
2 Application of Eltopia Communications LLC for a Certifcate of Public Convenience and
Necessity to Provide Local Exchange and Telecommunications Services, Case No. ECL-
T-07-01, Order No. 30442 (Sep. 24,2007).
Id.3
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types of services proposed by TWCIS.4 Yet, in those cases Staff supported certification.
There is no justification for treating TWCIS differently.
Q. IN YOUR OPINION, WILL THE ISSUANCE OF A CERTIFICATE TO TWCIS BE IN
THE PUBLIC INTEREST?
A. Yes. A CPCN will enable TWCIS to provide facilities-based wholesale and retail
intrastate telecommunications services to commercial customers in Idaho. These services
will, in turn, be used to make available new and competitive service offerings that will be
available to residential and commercial consumers in Idaho, in furtherance of the public
interest. It is well-established that increased competition leads to lower prices, service
innovation, more responsive customer service, and other benefits that increase consumer
utility and stimulate demand for the services supplied by all providers, including the
ILECs. Moreover, ILECs respond to robust competition by improving the efficiency of
their operations and expanding the market to which they offer their services, ultimately
benefiting consumers and the Idaho economy statewide.
Q. DOES THE ESTABLISHED PUBLIC POLICY OF THE STATE OF IDAHO FAVOR
GRANT OF THE REQUESTED CPCN?
A. Yes. The Idaho Telecommunications Act of 1988 was enacted in large par to promote
competition in the telecommunications marketplace within Idaho-in recognition of the
many benefits of competition, including those that I have just identified. Consequently,
Title 62 reflects a clear state policy in favor of promoting "effective competition," i.e.,
"substantive and meaningful competition throughout the incumbent telephone
corporation's local exchange callng area." See Idaho Code § 62-601(2). In fact,
4 For example, while ALEC represented to the Commission that it planned to provide other
services in the future that fell within the category of "basic local exchange service," the
fact remains that it was not providing any retail local exchange service at the time it
received a CPCN, thus undercutting any assertion that the provision of such a retail
service is a prerequisite to certification.
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encouraging entry by new service providers, such as TWCIS, is the overrding objective
of the Act-and one that the Commission has broad authority to pursue.
DOES ANTHING IN IDAHO STATE LAW PRECLUDE THE COMMISSION
FROM GRATING THE REQUESTED CPCN?
No. Even if TWCIS's Local Interconnection Service were not deemed a basic local
exchange service-which would mean that Idaho Code § 62-604 would exempt TWCIS
from the requirement to obtain a CPCN in order to provide this service-nothing in that
exemption forecloses TWCIS from seeking a CPCN on a voluntary basis. As TWCIS
has explained, it is not seeking certification for the purpose of subjecting itself to
burdensome regulations, but rather is seeking a CPCN because such authority is
necessary for TWCIS to enter the Idaho telecommunications market. Nothing in the
Idaho Code compels TWCIS to forego, or the Commission to deny, this vital prerequisite.
In fact, as just explained, clear state law and policy compel the opposite result.
WILL TWCIS BE ABLE TO ENTER THE IDAHO MART, AND DELIVER THE
PUBLIC INTEREST BENEFITS THAT YOU HA VE DESCRIBED, WITHOUT A
CPCN?
No. A CPCN is critical to enable TWCIS to obtain inputs and assistance critical to its
ability to operate in Idaho. For example, incumbent LECs wil refuse to interconnect
with an entity that does not hold a CPCN granted by the relevant state commission.
Without such interconnection, TWCIS will be unable to complete local telephone calls or
otherwise provide a viable service offering. Therefore, TWCIS's ability to interconnect
with other carrers is a fundamental requirement of its proposed business activities.
HAS TWCIS ATTEMPTED TO ENTER INTO ANY INTERCONNCTION
AGREEMENTS WITH INCUMBENT LOCAL EXCHANGE CARERS
OPERA TING IN IDAHO?
A.Yes. TWCIS recently attempted to enter into an interconnection agreement with Verizon,
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to the point of submitting signed interconnection agreement documents for Verizon to
counter-sign. However, Verizon refused to do so on the grounds that it had not received
the "required certification information" demonstrating that TWCIS holds a CPCN,
making clear its view that the absence of certification made the otherwise-acceptable
interconnection agreement "non-operational."s TWCIS informed Verizon of this
Commission's ruling that TWCIS did not require a CPCN to obtain interconnection, but
Verizon refused to accept any alternative to a CPCN as suffcient to demonstrate
TWCIS's entitlement to interconnect as a qualified telecommunications carrer.
Q. WILL TWCIS FACE ANY OTHER OBSTACLES IF IT DOES NOT OBTAIN A CPCN
FROM THE COMMISSION?
A. Yes. In addition to precluding interconnection, the denial of a CPCN would leave
TWCIS without the ability to obtain telephone numbers, route calls, and obtain other
inputs necessary to operate as a CLEC. 6 For instance, when a carrer requests telephone
number blocks, that entity's status as a holder of a CPCN is verified by the numbering
authority before number blocks are assigned. Similarly, TWCIS could not be listed in the
Local Exchange Routing Guide, which is essential to routing local calls, without an
Operating Company Number ("OCN"), and the National Exchange Carrier Association
assigns such OCNs only to entities that hold CPCNs. Without an OCN, TWCIS will be
unable to obtain company codes that identify it and permit it to pay and collect access
charges for the traffic it intends to car or to be listed in industry databases that are
necessary for the provision of service to customers. For example, TWCIS must have a
CPCN to obtain Local Routing Numbers ("LRNs"), which convey essential end user call
5 See Letter from Scott Miles, Contract Management, Verizon Global Wholesale to Mark
Swan, Time Warner Cable (Apr. 29, 2010) (attached hereto as Exhibit A).
6 See, e.g., Telephone Number Requirementsfor IP-Enabled Services Providers, Report
and Order, 22 FCC Rcd 19531, at ~ 12 (2007) (noting that NANP A "provides numbers
only to entities that are licensed or certificated as carrers under the (Federal
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routing information. Moreover, to paricipate in number porting, TWCIS must have an
OCN and provider proof of its CPCN to obtain a Service Provider Identification Number
("SPID") from the Number Portability Administration Center ("NP AC") and register as a
user for the NPAC's Service Management System ("SMS").
Q. DOES FEDERAL LAW PRECLUDE THE COMMISSION FROM GRATING THE
REQUESTED CPCN?
A. No. To the contrary, the Communications Act of 1934, as amended, establishes a clear
nationwide policy in favor of competition and expressly prohibits state legal requirements
that prohibit or have the effect of prohibiting competitive entry by new service
providers.7 Moreover, the Federal Communications Commission ("FCC") has made
clear that that "providers of wholesale telecommunications services" such as TWCIS
'"enjoy the same rights as any 'telecommunications carrier' under. . . the Act."g As noted
above, state law and policy are fully consistent with these federal objectives. In any
event, where, as here, a state commission's refusal to grant a CPCN would result in
prohibiting the applicant from providing telecommunications services in furtherance of
Congress's pro competitive objectives, such action would be subject to preemption under
Section 253 ofthe Act.
Q. DOES THIS CONCLUDE YOUR TESTIMONY?
A. Yes.
Communications) Act.").
7 See 47 U.S.C. § 253(a).
8 Time Warner Cable Request for Declaratory Ruling that Competitive Local Exchange
Carriers May Obtain Interconnection Under Section 251 of the Communications Act of
1934, as Amended, to Provide Wholesale Telecommunications Services to VoIP
Providers, Memorandum Opinion and Order, 22 FCC Rcd 3513, at ir 9 (WCB 2007)
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COURT REPORTER RECEiVED
John R. Hammond, Jr., ISB No. 5470
Batt Fisher Pusch & Alderman LLP
U.S. Ban Plaza, 5th Floor
101 S. Capitol Boulevard, Suite 500
Post Office Box 1308
Boise, ID 83701
Telephone: [phone]
Facsimile: [phone]
7UtIJUM -8 PM .Il:ltl
Hn PU;::'\ iC\0'1' - d.V-F, .. bi';a1l~t"lU- - ,f!iJ
UTiUTIES CÙMtùj~0¡ "
Attorney for Time Warner Cable
Information Services (Idaho), LLC
Before the
IDAHO PUBLIC UTILITIES COMMISSION
Application of )
)
TIME WARNER CABLE INFORMATION )
SERVICES (IDAHO), LLC )
)
)
)
)
)
)
Case No. TIM-T-08-01
For a Certificate of Public Convenience and
Necessity to Provide Competitive Facilities-
Based Local and Interexchange
Telecommunications Services within the
State of Idaho
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18 Q.
REBUTTAL TESTIMONY OF JULIE
LAINE ON BEHALF OF TIME
WARNER CABLE INFORMATION
SERVICES (IDAHO), LLC
PLEASE STATE YOUR NAME, TITLE, AND BUSINESS ADDRESS FOR THE
19 RECORD.
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My name is Julie Laine and I am Group Vice President, Regulatory of Time Warer
Cable. My business address is 60 Columbus Circle, New York, NY 10023. My
telephone number is [phone] and my email address is julie.laine(Ðtwcable.com.
HAVE YOU PROVIDED TESTIMONY IN THIS MATTER PREVIOUSLY?
Yes. I provided written testimony on behalf of Time Warer Cable Information Services
(Idaho), LLC ("TWCIS") on May 14,2010.
HA VE YOU REVIEWED THE REBUTTAL TESTIMONY FILED BY COMMISSION
STAFF ON MAY 27, 2010, AS AMENDED ON JUNE 3, 2010?
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Yes.
WHAT is THE PURPOSE OF YOUR TESTIMONY?
The purpose of my testimony is to respond to: (i) Staffs unsupported assertion that
TWCIS will not provide service to the "public," and therefore is not a "telephone
corporation" eligible to receive a certificate of public convenience and necessity
("CPCN"); (ii) Staffs inaccurate description of the services that TWCIS intends to
provide, and consequent failure to appreciate the barriers to entry faced by TWCIS in the
absence of a CPCN; and (iii) Staffs inaccurate description of TWCIS's efforts to
interconnect with Verizon in Idaho.
WHAT IS STAFF'S LEGAL BASIS FOR CONCLUDING THAT TWCIS'S LOCAL
INTERCONNECTION SERVICE WILL NOT BE PROVIDED TO "THE PUBLIC"?
Staff provides no such basis. Staff merely asserts that it defines "service to the public" to
mean "directly to the consumer or end user and not on a wholesale basis."1
is THERE CONTRARY AUTHORITY ON THIS POINT?
Yes. Like Idaho Code § 61-121(1), the federal Communications Act of 1934, as
amended, defines a "telecommunications service" as one offered "to the public."i Yet,
the Federal Communications Commission has, on numerous occasions, rejected the view
that the reference to "the public" in this statutory definition was intended to exclude
wholesale telecommunications services.3 In fact, the FCC has found that "(i)t is clear. . .
that the definition of telecommunications services. . . includes wholesale services when
2
Staff Rebuttal Testimony at 6.
See 47 U.S.c. § 153(46).
See, e.g., Implementation of the Non-Accounting Safeguards of Sections 271 and 272 of the
Communications Act of 1934, as Amended, Second Order on Reconsideration, 12 FCC Rcd 8653, at ~ 33
(1997).
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offered on a common carrier basis.,,4 Thus, the FCC has determined that "providers of
wholesale telecommunications services enjoy the same rights as any 'telecommunications
carier' under. . . the Act."s
Q: WHY SHOULD THIS COMMISSION ADHERE TO FEDERAL PRECEDENT?
A: As an initial matter, the FCC is an expert agency that has established precedent in this
area through careful deliberation over a period of years. The FCC has explained that
wholesale carers that furnish inputs to other service providers are common cariers
because they serve the subset of the public that can make use of the relevant offering, and
courts have upheld those determinations.6 In contrast, Staffs position is entirely
unsupported and at odds with federal and state policy favoring the promotion of
competition. This Commission accordingly should interpret Idaho Code § 61-121(1) to
be consistent with the well-established and judicially approved federal precedent.
Moreover, Staff s interpretation of Idaho Code § 61-121 (1) would effectively preclude
TWCIS from providing, within the state of Idaho, "telecommunications services" as
defined by the federal Communications Act. Accordingly, any such interpretation
invites, and would merit, preemption under Section 253 of the Act.
Q: HAVE OTHER STATES REJECTED TWCIS'S PROPOSED SERVICES?
A: No. As TWCIS noted in its direct testimony, Time Warner Cable indirectly controls 26
competitive local exchange carriers (i.e., one in each of 26 different states) that have
obtained a CPCN or equivalent authority to operate as a local exchange carrier, as
provided for under relevant state commission rules. In the aftermath of the TWC
Declaratory Ruling, no state authority has indicated that any Time Warner Cable
6
Time Warner Cable Requestfor Declaratory Ruling that Competitive Local Exchange Carriers May Obtain
Interconnection Under Section 251 of the Communications Act of 1934, as Amended, to Provide Wholesale
Telecommunications Services to Vo1P Providers, Memorandum Opinion and Order, 22 FCC Rcd 3513, at ~
11 (2007) ("TWC Declaratory Ruling").
Id. at ~ 9.
See Verizon CaL., Inc. v. FCC, 555 F.3d 270, 276 (D.C. Cir. 2009) (rejecting claim that a wholesale carrier
16
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affiliated local exchange carier's intention to provide wholesale local
telecommunications services would be a reason to deny such authority. In fact, all of
these entities limit their service offerings to wholesale and commercial customers.
Moreover, the local exchange service tariffs and price sheets filed by several of these
entities describe the very same service offerings that TWCIS proposes to offer in Idaho.
Q: DO YOU AGREE WITH STAFF'S SUGGESTION THAT TWCIS DOES NOT NEED
A CPCN AND THAT IDAHO STATUTES ALLOW "EASIER ENTRY INTO THE
MARKET THAN THE FEDERAL ACT,,7?
A: No. Staff provides no basis for this assertion, but appears to assume, incorrectly, that
"the absence of a CPCN does not preclude (TWCIS) from entering the Idaho market as a
wholesale provider."s In fact, the inability of TWCIS to obtain a CPCN has created
numerous bariers to entry, which Staff simply chooses to ignore. Of course, TWCIS
would not be pursuing this application for a CPCN if it could enter the market and obtain
interconnection and other necessary inputs without such operating authority.
Q: DO YOU AGREE WITH STAFF'S ASSERTION THAT TWCIS SHOULD BE ABLE
TO OBTAIN TELEPHONE NUMBERS, ROUTE CALLS, ETC. EVEN WITHOUT A
CERTIFICATE?
A: No. As an initial matter, Staff concedes its lack of expertise with respect to numbering
and related matters.
9 This lack of expertise is compounded by Staff s failure to
understand the nature of the service that TWCIS wil provide, and its relationships with
its customers and other service providers. Tellingly, Staff assumes that "the companies
that TWCIS provides wholesale service to, the companies providing service to end users,
serving only one Vo1P provider could not qualifY as a "telecommunications carrier").
Staff Rebuttal Testimony at 7.
Jd
9 Jd at i 1 ("I am not a numbering subject matter expert. . . .").
1 7
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should be able to obtain numbers."10 In fact, TWCIS's customers wil be Voice over
Internet Protocol ("VoIP") and other service providers that themselves lack CPCNs, and
thus have no ability to obtain numbers or other critical resources themselves. As the FCC
has explained, retail VoIP providers commonly rely on wholesale providers like TWCIS
to obtain numbering resources for their end users. i i Accordingly, there is no reason to
reject TWCIS's experience-based arguments in favor of the admittedly uninformed views
of Staff.
Q: IS THE "ADDITIONAL INFORMATION" PROVIDED BY STAFF WITH RESPECT
TO PREVIOUS INTERCONNECTION NEGOTIATIONS BETWEEN TWCIS AND
VERIZON ACCURATE?
A: No. Verizon has consistently refused to enter into an interconnection agreement with
TWCIS until TWCIS obtains a CPCN. Verizon has not based such refusals on the
understanding that TWCIS intends to provide retail services. Further, Verizon has never
represented to TWCIS that it would enter into an interconnection agreement covering
only "wholesale" services. Notably, Staffs rebuttal testimony provides no foundation for
hearsay claims to the contrary. When TWCIS requested that Staff provide a basis for
these claims, Staff provided only the e-mail attached as Exhibit A. Notably, that e-mail
merely reiterates Verizon's refusal to execute an interconnection agreement with TWCIS
in the absence of a CPCN. Nowhere does that e-mail state that Verizon would enter into
an interconnection agreement with TWCIS covering "wholesale" services generally.
More importantly, nowhere does Verizon represent that it would enter into an
interconnection agreement with TWCIS covering the specific types of services that
TWCIS intends to offer. Further, while that e-mail makes oblique references to the
10 Jd
II See TWC Declaratory Order at ~ 13 (noting that the Commission precedent has "expressly contemplated
that VoIP providers would obtain access to and interconnection with the PSTN through competitive
carriers.").
18
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5 Q:
6 A.
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availability of "other wholesale and commerciál" agreement forms, nowhere does it state
that these forms would not also require TWCIS to obtain a CPCN. In fact, nothing in that
e-mail even remotely suggests that Verizon views TWCIS's intended service as a
"wholesale" service not subject to certification.
DOES THIS CONCLUDE YOUR TESTIMONY?
Yes.
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1 (The following proceedings were had in
2 open hearing.)
3 MR. HAMMOND: Thank you, Commissioner. And with
4 that, we would open up the witness for cross-examination.
5 COMMISSIONER SMITH: And you i re presenting both
6 your direct and rebuttal at the same time?
7 MR. HAMMOND: At the same time, just for
8 expediency sake.
9 COMMISSIONER SMITH: Thank you, Mr. Hammond.
10 Mr. Price, do you have any questions?
11 MR. PRICE: I do. Thank you, Madam Chair.
12
13 CROSS-EXAMINATION
14
15 BY MR. PRICE:
16 Q.Good morning, Ms. Laine.
17 A.Good morning.
18 Q.I i d like to ask you a few questions regarding the
19 Company i s Application and your testimony today. If I could
20 refer you to page 5 of the Company i s Supplemental Application,
21 all right, what 1'm looking at here is approximately -- it i S in
22 the first paragraph, that first large paragraph.
23 COMMISSIONER SMITH: So, Mr. Price, I havenlt
24 caught up to you yet.
e 25 MR. PRICE: Okay.
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1 COMMISSIONER SMITH: I i m looking in my notebook.
2 Do you know the date of which the
3 MR. PRICE: It was filed November 9 of 2009.
4 COMMISSIONER SMITH: Ah.
5 MR. PRICE: It i s the Supplement. There was an
6 original Application, and it i s the Supplement.
7 COMMISSIONER REDFORD: What page is that?
8 MR. PRICE: It is on the page 5.
9 COMMISSIONER SMITH: Could we go off the record
10 just a minute?
11 (Discussion off the record.)
12 COMMISSIONER SMITH: We i 11 go back on the record.
13 Q.BY MR. PRICE: All right, 11m looking at
14 specifically starting with the end of line 3. If you could
15 read the sentence that begins with "local" and ends with
16 "calling area," so that complete sentence?
17 A.Sure:
18 Local interconnection service will be offered on
19 a wholesale basis to facilities-based providers of
20 interconnected VoIP services and will provide, among other
21 things, the transport and termination of voice calls wi thin a
22 local calling area.
23 Q.So, essentially here, Time Warner is saying that
24 they are going to provide wholesale services in order to
e 25 provide a competi ti ve choice wi thin Idaho. Isn i t that an
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1 admission from Time Warner that it won i t be offering
2 telecommunications services directly to the public?
3 A.NO, I believe that the consistent understanding
4 of the term lIto the public or some portion thereof," includes
5 wholesale customers and does not have to be residential
6 customers. It can be carrier customers. Some class of
7 customers constitutes lIthe public" in that context.
8 Okay. But what Time Warner is envisioning isQ.
9 that its entire customer base wi thin Idaho will be wholesale
10 customers. Correct?
11 A. Wi th respect to the local interconnection
12 service, the business model is that -- and this is being used
13 today in Idaho -- the business model is that Time Warner
14 Cable IS -- TWCIS -- regulated carrier entity will sell services
15 to its retail VoIP entity, which will provide services -- VoIP
16 services -- to end-user customers.
17 The retail entity owns the last-mile facilities
18 to the customer, establishes the customer relationship, sells
19 the service, performs customer care, and is the retail unit
20 that sells the service to the end user. TWCIS will perform all
21 of the local exchange functions and will sell those services
22 bundled as the local interconnection service, transport and
23 termination of traffic, the local number portability, the 911
24 service connecti vi ty, and all of those local exchange functions
25 to the VoIP entity. So, all of its customers would be
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1 interconnected VoIP providers ; it will be essentially a
2 carrier i s carrier.
3 It also has some other services that will be sold
4 to retail business services, but those are not those local
5 interconnection services. Those would be private line
6 transport services.
7 Q.Okay. So in your words, Time Warner --
8 Now, I use "Time Warner" as sort of a shorthand
9 for "TWCIS." It i S a little bit cumbersome to say as an
10 acronym.
11 A.Sure.
12 Q.Time Warner is going to be the carrier for the
13 VoIP providers?
14 A.That i S correct.
15 Q.Okay. And the Company has alleged in its
16 in your testimony -- and in its Application thattestimony
17 it i s effectively prohibited from obtaining numbers because it
18 can i t obtain a CPCN. Correct?
19 That i S correct. And, in fact, we i ve -- we haveA.
20 been -- not in Idaho: In other places -- prevented from
21 obtaining numbers without a CPCN generally.
22 Q.And 11m speaking to page 8 on that same
23 Supplemental Application, if you could turn there to page 8.
24 This is in the second paragraph. The end of the first sentence
e 25 says, basically, that Time Warner -- TWCIS -- will be
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1 prohibi ted from entry into the Idaho market.
2 Is it your understanding in any communications
3 that you i ve had with Staff, with the Commission, or any
4 communications you i re aware of that your employees there at
5 Time Warner, has Staff ever alleged or suggested that Time
6 Warner should be prohibited from entering into the Idaho
7 market?
8 A.Well, I think that the -- the problem is that
9 TWCIS cannot perform these interconnection and local exchange
10 functions for its affiliate and any other similarly-situated
11 customer without a CPCN because it cannot obtain an
12 Interconnection Agreement, cannot obtain telephone numbers,
13 cannot transport and terminate calls to other local exchange
14 carriers and pay reciprocal compensation or collect it on those
15 calls. It can i t do those things without a CPCN, which would
16 effectively prevent them from entering the market and being
17 able to support the VoIP services that its affiliate provides.
18 And if I could, just for some background, the
19 VoIP services are being provided today by the other affiliate.
20 That VoIP affiliate is using Sprint Communications today, which
21 is performing all of these interconnection wholesale functions
22 today for the VoIP affiliate. My understanding is those are
23 the only services that Sprint provides in Idaho today. It does
24 not offer basic local exchange service to residential end-user
25 customers; it provides them to Time Warner Cable iS VoIP
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1 affiliate only.
2 And the reason that we i re here is because we want
3 to -~ we i ve made the business decision to do this ourselves, to
4 transition off of Sprint and have our affiliate CLEC entity
5 provide all of these interconnection local exchange functions.
6 We won i t be able to do that and continue to offer the VoIP
7 services to end-user customers if we cannot obtain a CPCN.
8 Q.I understand that i s the practical effect, that i s
9 the argument the Company is making. But in your review of
10 Staff i s testimony and their comments in this case, has Staff
11 made an assertion or alleged that Time Warner should not be
12 allowed to operate wi thin Idaho?
13 A.But -- not to operate, but to offer these local
14 interconnection services, it seems to me, because from our
15 perspective, we canlt provide them without a CPCN. We can't
16 provide them without an Interconnection Agreement, and we can 't
17 obtain an Interconnection Agreement without a CPCN, in addition
18 to some of the other functions.
19 Q.In getting back to your statement about your
20 fixed VoIP providers, the people that you i re going to provide
21 service to, those providers can obtain a CPCN and have in the
22 past, correct, in Idaho?
23 I don i t know in Idaho specifically, but I believeA.
24 that they could obtain a CPCN, yes; although, our position is
25 at this point the FCC has made it clear that those VoIP
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1 providers do not need to be subj ect to entry requirements at
2 the State level, and, therefore, should operate without having
3 to be able to obtain a CPCN as we i re doing today.
4 Q.Okay. But they can operate and are operating
5 wi thin Idaho. Would you be surprised to learn that they have
6 been granted CPCNs in Idaho?
7 A.I have no knowledge of that in Idaho, to be
8 frank.
9 Q.And you make reference -- let me reference page 3
10 of your rebuttal testimony. That i s -- that would be the last
11 testimony that was submitted by either party, page 3. 11m
12 looking at specifically your reference to FCC Docket No. 0655.
13 A.The Time Warner Cable Request for Declaratory
14 Ruling. i don I t know the docket number. Is that the docket?
15 Q.Yes.
16 A.Yes. Okay.
17 Q.That is at Footnote 4, in other words.
18 A.Right.
19 Q.And you make reference to that case as a support
20 that Time Warner shouldn I t be precluded from being granted a
21 CPCN wi thin Idaho.
22 In your review of this case, are you aware
23 that -- what Time Warner petitioned the FCC for a ruling for in
24 that case?
e 25 A.Yes.
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1 Q.What did they Petition the FCC for?
2 A.The -- in that case, the incumbent LECs in a
3 number of states had alleged that wholesale carriers such as
4 TWCIS that provided wholesale services just to other service
5 providers and not to end-user customers that were residential
6 customers were -- that the ILECs were contending that they were
7 not required to enter into an Interconnection Agreement with
8 that type of carrier
9 Q.Okay.
10 A.-- and were not entitled to 251 interconnection.
11 Q.Okay.
12 A.The FCC looked at that and declared that, in
13 fact, those carriers are local exchange carriers and are
14 enti tled to interconnection under Section 251.
15 Q.Okay. And so the FCC complied, gave you a
16 Declaratory Ruling that wholesale providers are entitled to
17 interconnection.
18 Would it surprise you to learn that the Idaho
19 Commission actually agrees with that ruling and has
20 affirmatively stated that wholesale providers are entitled to
21 interconnection with incumbent carriers in Idaho?
22
23
A.No. No, it wouldn i t surprise me.
Q.Okay. And Staff, in its meetings with the
24 Company, in its comments, in its testimony, has also stated
e 25 that Time Warner should have interconnection with incumbent
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1 carriers in Idaho?
2 A.That i S my understanding.
3 Q.Okay. Has -- I know you make reference -- and
4 maybe this is a good time to turn to that -- to your
5 discussions with Verizon wi thin Idaho and their unwillingness
6 to grant you interconnection. Maybe we could turn to page 5 of
7 your rebuttal, and 1'm looking at specifically that would be
8 the question and answer starting with line 8. In line 11, you
9 state that Verizon has consistently refused to enter into an
10 Interconnection Agreement with Time Warner until it obtains a
11 CPCN.
12 Isn i t it true that Time Warner actually has
13 negotiated an Interconnection Agreement with Verizon in Idaho?
14 That i S correct, although Verizon would not signA.
15 the Agreement because we didn i t obtain a CPCN.
16 Okay. And in your exhibits to the case, I thinkQ.
1 7 it refers to "necessary documentation"?
18 A.That i S correct. That i s the CPCN.
19 And there were several months where they would
20 contact us and say, How is -- you know, Do you have the CPCN?
21 Given Verizon i s sale to Frontier, they wanted to
22 close the deal before that happened, and the deadline came and
23 they said, You don i t have a CPCN.
24 And they informed us that they would be canceling
25 the Agreement, not moving forward with it.
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1 Q.Okay. And have you had a chance to review the
2 e-mail communication between Staffmember Grace Seaman and
3 Renee Willer?
4 A.I have, although that -- I donlt know -- I donlt
5 have it before me.
6 Q.Okay.
7 MR. PRICE: May I approach the witness?
8 COMMISSIONER SMITH: You may.
9 MR. PRICE:(Indicating. )
10 COMMISSIONER SMITH: Are we going to do this as
11 an exhibit or are you just using it?
12 MR. PRICE: I was going to establish foundation
13 first.
14 COMMISSIONER SMITH: Okay.
15 BY MR. PRICE: Okay, so we i re looking at anQ.
16 e-mail communication. At the top is Grace Seaman, the name
17 Grace Seaman. It says from Renee Willer at Verizon. com.
18 Do you have that in front of you?
19 A.I do.
Q.And what is the time stamp on that?
A.Friday, May 28,2010,3:36 p.m.
Q.And it i S addressed to whom?
A.Grace Seaman.
Q.Okay. And--
MR. HAMMOND: Commissioner Smith, 11m going to
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2 COMMISSIONER SMITH: Mr. Hammond.
3 MR. HAMMOND:at this point. I i m not saying
4 this exhibit shouldn i t come in at this point, but as far as our
5 wi tness laying testimony -- or, foundation for it I don i t
6 think that i s appropriate. I think if that communication was
7 with the Staffl s witness, they can do that then.
8 COMMISSIONER SMITH: Mr. Price.
9 MR. PRICE: Thatls fine. I can just use it for
10 illustrative purposes right now, and if we want it admitted as
11 an exhibit, weIll have Ms. Seaman testify to that.
12 COMMISSIONER SMITH: All right.
13 MR. PRICE: That's fine.
14 Q.BY MR. PRICE: Can you read for me on page -- on
15 the e-mail the text starting with "Verizon also provides."
16 It I s the last paragraph there.
17 A.Verizon also provides other wholesale and
18 commercial Agreements to competitive providers, but due to the
19 nature of their request to provide facilities-based local
20 exchange service to end-user customers, a standard ICA was
21 negotiated.
22 Q.So would you agree that in this paragraph, it
23 appears that Verizon has two different types of Interconnection
24 Agreements that it enters into?
e 25 A.That i s what they say. But I disagree with the
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1 Request -- that the Request was to provide facilities-based
2 local exchange service. That was never the Request.
3 And, in fact, the Agreement -- I reviewed the
4 Agreement before coming here, and the definition of "customerll
5 in the Agreement specifically makes it clear that the end-user
6 customer would not be the end-user customer of TWCIS but could
7 be the end-user customer of TWCIS i s customers. So it was
8 expressly contemplated in the language of the Agreement that
9 TWCIS would be offering wholesale services.
10 Q.Okay. If that i s a misunderstanding, you know,
11 I i m not really speaking to that point. What I want to refer
12 you to is to page 5 of your rebuttal testimony, lines 14 and
13 15. Actually, starting at the end of line 13, you state:
14 Verizon has never represented to TWCIS that it
15 would enter into an Interconnection Agreement covering only
16 wholesale services.
17 Does that seem to contradict with the passage you
18 just read from the e-mail?
19 A.No, because my testimony says that they have
20 never represented to us, and this e-mail is directed to the
21 Staff. Secondly, the -- so I don't think it i S inconsistent at
22 all.
23 The Agreement is clear that it could address both
24 situations, but it clearly addresses the wholesale situation.
25 Q.Okay. Would the Company be interested in
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1 pursuing an Interconnection Agreement -- separate, distinct
2 Interconnection Agreement -- that deals with wholesale
3 providers?
4 A.Well, again, I think that, you know, we do this
5 allover the country with ILECs and including Verizon. This
6 was a mul tistate Agreement that would cover several states.
7 From our perspective, it i S not necessary. There i s no
8 difference. The inputs that we require are the same.
9 And that definition of "customer," that the
10 end-user customer if, as this Agreement does, it reflects the
11 point that it could be either the end-user customer of the CLEC
12 or of the CLEC i s customers, and that i s really all that i s
13 necessary.
14 My understanding, based on years of negotiation
15 of ICAs with ILECs, is that there i s no different ICA for a
16 wholesale carrier versus a retail carrier. That i s news to me.
17 Q.Okay. And as far as being denied interconnection
18 with Verizon i s facilities, has the Company issued a formal
19 Complaint to the Idaho Commission regarding that denial of
20 interconnection?
21 A.No, because they -- it was related to the CPCN,
22 so, no. I mean, it was -- our understanding of Verizonls
23 position is that it i S legitimate; that CLECs, local exchange
24 carriers that are certificated by State Commissions, are
25 enti tled to the Interconnection Agreements. We don i t have
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1 that, that certification, so we did not file a Complaint.
2 Q.But it i S your previous testimony here that you
3 are aware that the Idaho Commission doesn i t make that a
4 prerequisi te to gaining interconnection with incumbent
5 carriers?
6 A.That i S my understanding.
7 Q.Okay. And with that understanding, the Company
8 still is not interested in issuing a Complaint against
9 Verizon?
10 A.Well, you know, we haven i t frankly thought about
11 it at this point because we i re still pursuing the CPCN and
12 seeing that process through to the end. I suppose that if we
13 got to the point where we were to lose this Motion for
14 Reconsideration we could decide which options to pursue, but we
15 frankly haven i t thought about a Complaint against Verizon.
16 They seem to be fulfilling their own role, which is to grant
17 ICAs only to certificated CLECs.
18 Q.Okay. I i m trying to figure out -- we i ve kind of
19 gone out of order in my questions here. 1'm trying to figure
20 out where 11m at.
21 All right. All right, so one of the themes from
22 Staff I s comments in their testimony has been that Time Warner
23 doesn i t merit a CPCN because the Commission just simply lacks
24 the authority or the jurisdiction to grant that CPCN. They
e 25 didn i t want to create the appearance of authority where none
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1 exists.
2 And, obviously, Time Warner i s assertion here has
3 been that the Commission isn 't prohibited from issuing a CPCN
4 and stating that the Commission actually does have jurisdiction
5 authori ty over Time Warner.
6 Is the Company is Time Warner also arguing
7 that the Commission has jurisdiction over Time Warner in other
8 areas besides the grant or denial of a CPCN?
9 A.1'm not sure -- when you say, "Other areas," 11m
10 not sure I understand.
11 Q.Well, would the Commission have full jurisdiction
12 authori ty, for example, to adj udicate customer complaints that
13 were issued against Time Warner?
14 Sure. You know well, there i s a couple ofA.
15 aspects of this. One is as a CPCN holder and a licensed
16 carrier, we would be subj ect -- I mean, that i s part of it.
17 We i re not here because we simply want to be -- are seeking
18 regulation even though we don i t think that we are required to
19 be regulated. Being a carrier has certain rights associated
20 wi th it such as the right to interconnection, the right to
21 obtain telephone numbers, the right to interconnect with other
22 carriers. And then there i s certain obligations. We i re here to
23 say we want those rights, and what comes with that are the
24 attendant responsibilities and obligations. We i 11 take all of
25 that on. We also -- so that i s on the carrier side, that i s on
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1 the TWCIS side.
2 On the VoIP provider side, we currently provide
3 service in Idaho today. We don i t do it pursuant to a CPCN, but
4 we do respond to customer complaints; we do pay in to the State
5 Uni versal Service Fund for those VoIP services; and we do
6 recognize, despite the lack of a CPCN on that surface, certain
7 jurisdiction that the Commission should legitimately be able to
8 exert over us, the customer complaint side in particular.
9 Q.Okay. So suppose that myself, you know, as a
10 Idaho resident, I call up Time Warner Cable Information
11 Services and I say, I see that you i ve been granted a CPCN. Can
12 you provide me with services directly to my home?
13 Would Time Warner do that for me?
14 At this time, we have no plans to offer servicesA.
15 directly to retail end-user customers, residential, so we would
16 explain that we don i t offer that type of service.
17 Okay. And that would be the same answer if IQ.
18 were a small businessman?
19 Right. I mean, if it were POTS, or plain oldA.
20 telephone service, we might offer the small business some
21 transport private line services, but we wouldn i t offer -- we
22 don i t have any current plans to offer plain old telephone
23 service to businesses or residential users.
Q.Okay. And it i S part of your job obviously
you i re the witness for Time Warner to be aware of the
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1 cri teria -- the eligibility criteria -- for granting a CPCN in
2 Idaho. Correct?
3 A.Correct.
4 Q.And to your knowledge, is the ability to gain
5 interconnection -- effective interconnection -- with another
6 incumbent carrier, is that one of the criteria for awarding a
7 CPCN in Idaho?
8 A.Well, I think that the -- it i S intermingled. The
9 criteria is if you i re providing telecommunications services and
10 that means you i re providing telecommunications to the public,
11 and our view of that and the FCC i s clear view of that is that
12 the public can be a class of customers. It doesn i t have to be
13 the entire public. It i S a certain class of customers. That iS
14 always been the case under Federal law.
15 In order to get interconnection, you have to be a
16 telecommunications carrier, and if the State won't declare us
17 to be a telecommunications carrier, then we can i t obtain an
18 interconnection.
19 So is it in the Statute for CLEC certification,
20 no, but it i S one of the -- as I said earlier, one of the rights
21 that you get as a CPCN holder is to get interconnection, and we
22 cannot get that interconnection without the CPCN.
23 Okay. And the ability to obtain numbers from theQ.
24 pooling administrator, is that one of the specific criteria
25 contained within Title 61, Title 62, or Rule 114 of the Idaho
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1 Commission?
2 A.Not as far as 11m aware, but it i S one of the
3 rights that you obtain as a CPCN holder after you -- after you
4 get your CPCN, you then have the right to go to the North
5 American Numbering Administrator and request numbers. You
6 don i t have that right if you've not been declared a CLEC by the
7 State.
8 Q.Okay.
9 MR. PRICE: Can I have just one moment,
10 Madam Chair?
11 COMMISSIONER SMITH: Certainly.
12 (Discussion off the record.)
13 MR. PRICE: I have no further questions.
14 COMMISSIONER SMITH: Thank you, Mr. Price.
15 Do we have questions from the Commission?
16 COMMISSIONER REDFORD: No.
17 COMMISSIONER SMITH: Commissioner Kempton.
18 COMMISSIONER KEMPTON: Thank you, Madam Chairman.
19 I have a couple.
20 COMMISSIONER SMITH: Would you please use your
21 mike?
22 COMMISSIONER KEMPTON: Excuse me. Thank you.
23
24
25
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1 EXAMINATION
2
3 BY COMMISSIONER KEMPTON:
4 Ms. Laine, in your Supplement to the ApplicationQ.
5 dated November 9, 2009, which is at Tab 3 in the Commission IS
6 notebook, you state that, in fact, TWCIS has proposed to offer
7 a service that should be considered a form of basic local
8 exchange service.
9 Do you believe that it i S necessary to split hairs
10 in trying to work to a position where you would fall under
11 coverage of basic local exchange service?
12 First of all, can you direct me to which page?A.
13 Q.Yes. On page 4, 1'm sorry.
14 A.Okay.
15 Page 4, just below Section 2, Service, LocalQ.
16 Exchange Service.
17 I'm not sure I understand the question in termsA.
18 of splitting hairs. I do think that the local interconnection
19 service constitutes local exchange service.
20 In Staff i s discussion of whether you do or do notQ.
21 serve a basic local exchange service protocol, you indicate
22 here that your service should be considered a form of basic
23 local exchange service. Would you define the distinction of
24 "basic exchange service" as would be defined, say, in Idaho
25 Code and what you mean by "form" of that same service?
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1 A.Well, again, I think that the local
2 interconnection service provides two-way interconnection
3 between the facilities of the TWCIS customers and the PSTN, and
4 it i s -- allows for communication wi thin the local exchange.
5 So, you know, there are different types of -- I guess the term
6 "form" was intended to reference the fact that there could be
7 other things covered under the Statute other than simply a
8 residential customer calling the Phone Company and asking for a
9 POTS line; that our business model which has -- again, it i S in
10 use today in Idaho and throughout the country -- is that the
11 CLEC provides the ability and the transmission of traffic
12 wi thin the local exchange, but doesn i t necessarily -- doesn It
13 serve the end-user customer. It provides service to the
14 service provider that serves the end-user customer.
15 So the term "form" was intended to reflect the
16 fact that there could be different business models that would
17 nonetheless fall under this Statute.
18 Q.And, Ms. Laine, if you would then, on page 7 in
19 that same Supplement and in the second paragraph on page 7, you
20 state that: Finally, while Staff has suggested that TWCIS may
21 provide only those specific services that are authorized in
22 granting a CPCN, TWCIS submits that Idaho law contains no such
23 limitation. Rather, if TWCIS is granted a CPN (sic), as it
24 believes it must be,then it will be free to provide any
additional services which it chooses to tariff.
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HEDRICK COURT REPORTING LAINE (Com)
P.O.BOX 578,BOISE,ID 83701 TWCIS
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1 Would you describe what some of those other
2 additional services might be?
3 A.Well, I mean, the first sentence refers to the
4 fact that the view here in the Staff i s mind seems to be that
5 we can only provide the basic POTS service to residential
6 end-user customers or business end-user customers.
7 If we were granted a CPCN based on our offering,
8 as we believe we should be, then, as is the case is my
9 understanding with any other carrier here and in any other
10 state, you can add service offerings, delete service offerings,
11 change service offerings later on, and that was really all that
12 that sentence was intended to convey.
13 We may at some point down the road decide that
14 the business model for VoIP is not going where it should be and
15 maybe we would provide circuit-switched residential service.
16 We have no plans to do that, but as all CPCN holders are
17 enti tled to do, that was simply to reflect the fact that once
18 you have a CPCN, you can add services, change services, and do
19 different things under that CPCN. I think carriers do that all
20 the time.
21 Q.Okay. And on page 7 -- same page -- in
22 Section 4, the end of the first paragraph in that section, you
23 said: Indeed, finding TWCIS ineligible for a CPN (sic) based
24 on a cramped reading of Title 61 and 62 of Idaho Code would run
25 afoul of Federal law and undercut important policy obj ecti ves.
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1 That statement notwithstanding, in the discussion
2 that you had with PUC Counsel a moment ago concerning
3 Declaratory Decisions by I believe it was the FCC, that a
4 authorized forCPCN -- that you were TWCIS was
5 interconnection service and your statement that you had not
6 elected to pursue a Complaint against Verizon as adverse to
7 pushing for a CPCN, seems, to me, a lack of due diligence in
8 processing information that Staff has provided since November
9 and December of 2009 about the fact that Staff considered the
10 interpretation to be that a CPN (sic) wouldn i t be authorized
11 for TWCIS.
12 And so my question, basically, after all of that,
13 is why did you not pursue the Complaint process as adverse to
14 continuing to request for a CPCN where you knew that you were
15 going to be moving uphill?
16 Well, respectfully, I don i t think that we believeA.
17 that we i re authorized for interconnection without a CPCN. Now,
18 Staff i s view is that we are, but I think what i s important here
19 is Verizonls view, which is that welre not.
20 And, sure, there are different -- perhaps a
21 Complaint against Verizon would require or would allow the
22 Staff and the Commission to require Verizon to interconnect
23 wi th us, but it i S not simply about the Interconnection
24 Agreement.
25 If we get an Interconnection Agreement with
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TWCIS
e 1 Verizon and we go get numbers, the numbering authority will ask
2 for evidence of our CPCN, which we still won i t have. The
3 North -- the NECA folks when we go to apply for an operating
4 Company code, which is required to provide the services that
5 TWCIS intends to provide, when we apply for our code, they will
6 ask for evidence of the CPCN, and when we don i t have it, we
7 will be denied. There are a number of other operating codes
8 and things like that.
9 So we will continue to be prohibited from
10 offering the telecommunications services that we seek to offer
11 even if the Commission were to order Verizon to enter into an
12 Interconnection Agreement with us, so we thought that the best
e 13 way to move forward was to pursue the CPCN to the end and seek
14 Reconsideration of the Commission i s Order; and I think that
15 it i S well within our prerogative to do that, given the fact
16 that even with the Interconnection Agreement, we will not be
17 able to offer the telecommunications services that we seek to
18 offer.
19 Q.So I have two questions and it i S sort of a Y in
20 the road, and as Yogi Berra would say, "Take it," and so I
21 don't know which one to use first. So 11m going to go back to
22 the discussion that we i ve had on Footnote 4 on page 3 which had
23 to do with a Request for Declaratory Ruling on competitive
24 local exchange carriers obtaining interconnections under
e 25 Section 251 of the Communications Act of 1934, as Amended.
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1 You do not consider that footnote a precedent
2 footnote? In other words, you put that in there, but you don It
3 intend that it i s to indicate a precedent?
4 I don i t believe I -- I don i t believe I said thatA.
5 at all. What page is this on? I i m sorry.
6 Q.No, I didnlt say you stated it as a precedent.
7 11m asking if you wanted that to be interpreted as a precedent.
8 It i S on page 3, Footnote 4.
9 MR. PRICE: Of the rebuttal.
10 THE WITNESS: Of the rebuttal.
11 This was cited as precedent for the proposition
12 that the term "to the public" in the definition of
13 "telecommunications services" under State and Federal law is
14 encompassed by wholesale carriers offering services to a class
15 of customers such as two facilities-based interconnected VoIP
16 providers, that that satisfies the term "to the public." That
1 7 was what that was cited for.
18 BY COMMISSIONER KEMPTON: Okay. And then theQ.
19 second question, that again goes back to what we were talking
20 about earlier, about your options for other courses of action
21 that would continue to pursue a CPCN, since a lot of the
22 discussion between TWCIS and Staff was -- a lot of the
23 conversation was conducted prior to December 2009 when the
24 Staff issued their comments, their position, and at which time,
25 formally, TWCIS was notified of what Staff i s position was, why
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1 after that period of time since interpretation of Statutes seem
2 to be a maj or part of this issue, why TWCIS didn i t take this up
3 with the Idaho Legislature during the three months they had
4 available, in January, February, and March?
5 A.Well, you know, I -- 11m not sure that I have the
6 abili ty to answer why we didn i t take this up with the
7 Legislature. I think that we believed that the Commission
8 would grant us a CPCN, to be frank; that we Ire entitled to it;
9 that we i re not seeking it on some whim; that we need the CPCN,
10 we qualify for the CPCN, and, frankly, we have 26 other CPCNs
11 and I don i t think it really crossed our minds too seriously
12 that we would be denied a CPCN.
13 COMMISSIONER KEMPTON: I have no further
14 questions, Madam Chair.
15 COMMISSIONER SMITH: Thank you.
16
17 EXAMINATION
18
19 BY COMMISSIONER SMITH:
20 I just have a couple and they i re along the sameQ.
21 lines as Commissioner Kempton, and you have laid out
22 somewhere -- yeah, it was in the Application -- the Supplement
23 to the Application that was filed on November 9th on page 4,
24 and you state the definition in Idaho Code 62-603 (1) that
25 defines "basic local exchange service. ii And I guess I ought to
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1 let you know that I suffer from the handicap of having lived
2 through the three years of drafting that led to this being an
3 Idaho Code, and it plainly states that it i s the provision of
4 access lines to residential and small business customers
5 So in your argument on the next page, it seems,
6 to me, that in order to find that your local interconnection
7 service is basic local exchange, we have to ignore the
8 requirement that it i S access lines to residential and small
9 business customers unless you tell me that your TWCIS customers
10 that you refer to are residential and small business customers,
11 "small businessll being further defined as five lines or fewer.
12 So--
13 A.Well, again, our view is that the reading of
14 that would provide the ability for service providers to connect
15 to the public switched telephone network.
16 Q.Well, I think that i s great, but that is not the
17 provision of access lines to residential and small business
18 customers. And I can tell you that in 1988, that the words put
19 there meant exactly what they said and that i s what was
20 envisioned, so --
21 A.Okay. Well, as we i ve said in the Application, we
22 don i t believe that the Commission is required to read the
23 Statute in such a limited way. And I think that in view of the
24 fact that the FCC and State Commissions have indicated that
25 this business model is the best way for local competition to be
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1 achieved and is really the only way that local competition has
2 been achieved in the last five years for the first time, that
3 such a reading of the Statute is not required and that there
4 are other forms of basic local exchange service that the
5 Commission could authorize.
6 Well, I i ve dealt with the Legislature for quite aQ.
7 while now, and I don i t think they take kindly to a State agency
8 saying, Oh, by the way, we i re going to read this differently
9 than what you intended and enacted; if that i s what you Ire
10 asking us to do.
11 Well, again, our reading is not that you isA.
12 that this definition -- that our service could be read to be
13 encompassed in this definition.
14 So it seems, to me, that you i re also arguing thatQ.
15 the FCC has already stated that your type of business is
16 entitled to get an Interconnection Agreement. Is that correct?
17 A.That the wholesale carriers that serve
18 exclusively VoIP providers, yes, are entitled to --
19 Q.Are entitled to Interconnection Agreements?
20 Yes, I think that i s exactly what the ruling inA.
21 the Declaratory Ruling Order was about.
22 Q.Okay. So it seems, to me, that the real hang-up
23 here is the industry i s practices, which apparently haven i t
24 caught up to the FCC i S Declaratory Order if they keep asking
25 you for something that under State law you don i t need and under
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1 FCC i S Declaratory Order you i re entitled to, and they keep
2 asking for something else. So, it seems, to me, like it i s the
3 historical practice of the industry that i s standing in your
4 way.
5 A.Is that a question?
6 Q.If you want to respond, you can. If you don It
7 have an answer, that i s fine.
8 A.No, I think that i s possible, certainly. I think
9 that, unfortunately, we have to operate wi thin the constraints
10 of the industry.
11 Q.No, no, no. That may be your world, but our
12 world is the Idaho Code. This is our constraint. So the
13 industry practice can be, you know, whatever it is, but this is
14 our rule book. So if they i re choosing to require something
15 that they don It, by law, have to require, it i S not our problem.
16 Well, I think that, by law, that the law is thatA.
17 the numbering folks have to give numbers only to certificated
18 entities.
19 And I would also say that -- respectfully -- that
20 Section 253 makes it clear that the Commission should be guided
21 by, you know, Federal law as well, which says that the State'
22 Commission would be preempted if they were to prevent an entity
23 from offering a telecommunications service.
24 Well, then maybe that i s your route, because IQ.
25 only have the authority that the Idaho Legislature chooses to
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1 give me, and the Federal government cannot delegate or assign
2 me responsibilities that the Idaho Legislature hasn i t said that
3 I i m obligated to follow. So, anyway, we i re off on a tangent,
4 and I appreciate your indulgence of this.
5 So I just have one more question, and that is
6 your -- these entities you refer to as the TWCIS customers, do
7 they have Certificates of Public Convenience and Necessity?
8 Well, currently we don i t have any customers, butA.
9 the affiliated customer will not. Other customers mayor may
10 not, depending on their own business plan, but mostly not, I
11 would say, because the intent is that they i re interconnected
12 VoIP providers.
13 And the only other thing I would add is that --
14 And they don i t because we don i t regulate VoIP?Q.
15 A.Correct.
16 And I think that, you know, one thing the
17 Commission might consider is the fact that -- well, I think
18 we i re offering VoIP services today under this business model
19 and, you know, if we i re prevented from entering as a CLEC on
20 our own, I just -- it iS -- it raises the question about the
21 current CLECs that are doing this in Idaho today and what the
22 Commission i s position with respect to those folks would be.
23 Okay. Thank you very much.Q.
24 COMMISSIONER SMITH: Mr. Hammond, any
25 COMMISSIONER KEMPTON: Commissioner.
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1 COMMISSIONER SMITH: Oh, Commissioner Kempton.
2
3 EXAMINATION
4
5 BY COMMISSIONER KEMPTON:
6 Ms. Laine, just for the record, itls not aQ.
7 question but I would note that if you are playing, to any
8 extent that you may be playing, Idaho Rules off against Idaho
9 Code, PUC Rules off against Idaho Code, you probably should be
10 aware that Idaho is one of the few states in the nation that
11 allows Legislative oversight of Executive Rule; and so each
12 year the Rules go back before the Idaho Legislature, and so
13 what we have in Rule is actually, when it comes to whether it i s
14 whether the Rules speak to the Legislative intent or not, the
15 Rules are reviewed by the Legislature every year.
16 Okay. Yeah, we i re not trying to play anything,A.
17 frankly, and we i re simply trying to compete in the marketplace.
18 I know. And my point was only for the record inQ.
19 the sense that as you think about your options --
20 A.Uh-huh.
21 -- that one of those might more practicably beQ.
22 something other than trying to take a CPN (sic) to the ball on
23 the assumption that you have a right to enter and dance because
24 you do it in 26 other states. It depends on the emphasis that
25 the Idaho Legislature tried to put on connections to, as Idaho
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1 is very rural, to residential residences and small businesses.
2 A.Uh-huh.
3 Q.So, like I said, there i s no question in there and
4 I don i t know that the information is of any advantage, but it
5 does relate in some degree to the question that I personally
6 asked and I believe that Commissioner Smith did as well.
7 A.Right. And I think that that i s useful and
8 certainly one route. I don i t think that the Legislature would
9 have intended that it would be -- it would take such time for a
10 competi tor to gain entry that they had to change the law to do
11 so; and that would be our concern with that route, that it
12 would take so long that we would be prohibited from entering
13 for, potentially, years.
14 COMMISSIONER SMITH: Any redirect, Mr. Hammond?
15 MR. HAMMOND: Just a couple.
16
17 REDIRECT EXAMINATION
18
19 BY MR. HAMMOND:
20 Is Time Warner Telecom an affiliate of yourQ.
21 company?
22 No. At one point, it was. At this point, thereA.
23 is no relationship at all.
24 So if they were granted a CPCN in Idaho, it hasQ.
25 no relation to the Company that you work for?
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21
22
23
1 A.That i S correct. And, in fact, we have no
2 relation to Time Warner, Inc., either, despite the name. We
3 are entirely separate from both Time Warner, Inc., and Time
4 Warner Telecom.
5 Q.And so you -- I think you i ve testified and
6 referred it quite a number of times that the issue is not just
7 interconnection. Wi thout the CPCN, in all practicality, your
8 difficul ty i S not only getting an ICA, but also some of these
9 other issues dealing with numbers. So it i S not simply a
10 one-size-fi ts-all process: Either a Complaint, go to the
11 Legislature, or --
12 A.That i S correct. And, in fact, I i m not sure it i s
13 just industry practice. I think that a lot of that is governed
14 by the law as well, particularly in the numbering context. So
15 we i re constrained not just by industry practice, but by the
16 current law.
17 MR. HAMMOND: Can I have just a moment?
18 COMMISSIONER SMITH: Certainly.
19 (Discussion off the record.)
MR. HAMMOND: I don i t have anything further.
COMMISSIONER SMITH: Okay. Thank you.
(The witness left the stand.)
COMMISSIONER SMITH: I think we should take about
24 a ten-minute break and reconvene at 10: 35.
e 25 (Recess. )
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1 COMMISSIONER SMITH: We i 11 go back on the record.
2 Mr. Price, ready for your witness.
3 MR. PRICE: Thank you, Madam Chair. The Staff
4 calls Grace Seaman to the stand.
5
6 GRACE SEAMAN,
7 produced as a witness at the instance of the Staff, being first
8 duly sworn, was examined and testified as follows:
9
10 COMMISSIONER KEMPTON: Be seated.
11
12 DIRECT EXAMINATION
13
14 BY MR. PRICE:
15 Q.Good morning.
16 A.Good morning.
17 Q.Please state your name and spell your last for
18 the record.
19 A.My name is Grace Seaman, S-E-A-M-A-N.
Q.And by whom and in what capacity are you
21 employed?
22 A.I i m employed by the Idaho Public Utili ties
23 Commission as a utilities analyst.
24
e 25
Q.Okay. And, Ms. Seaman, on June 2 of this year,
2010, you filed amended rebuttal testimony in Case No.
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1 TIN-T-08-01 consisting of 13 pages. Correct?
2 A.That i S correct.
3 Q.Do you have any additions or corrections to your
4 testimony?
5 A.No, I do not.
6 Q.Okay. If I were to ask you those same questions
7 today, would your answers be the same as if I asked them
8 today?
9 A.Yes.
10 MR. PRICE: Madam Chair, I i d now move that
11 Ms. Seaman i s amended rebuttal testimony be spread on the record
12 as if read.
13 COMMISSIONER SMITH: Okay. Thank you, Mr. Price.
14 MR. HAMMOND: Commissioner Smith, just for the
15 record, we would obj ect to the entry of largely all this
16 testimony as it i S a fact witness, however, testifying to
17 interpretations of legal statutes, legal authorities. I don i t
18 believe that i s appropriate, so we'd just register that
19 obj ection for the record.
COMMISSIONER SMITH: Mr. Hammond, I would note
21 your obj ection. Grace is our expert policy witness. I think
22 she can express her opinion, and we will give ample opportunity
23 for the lawyers to weigh in with their briefs on any issues
24 that they think need a legal analysis, recognizing that
e 25 Ms. Seaman is not the person to give a legal opinion or legal
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1 analysis but she is certainly entitled to her expert opinion
2 working in this field. So if that was an obj ection, it i s
3 overruled.
4 And I would note that there was an error in the
5 Commission i s Notice which denoted Ms. Seaman i s or the Staff
6 testimony would be rebuttal, which, of course , it i S not
7 rebuttal; it is direct testimony. So I think we ought to
8 reflect that this is Ms. Seaman i s direct testimony and not
9 amended rebuttal, because it i S her direct testimony in this
10 case.
11 MR. PRICE: I apologize for that error.
12 COMMISSIONER SMITH: And only the Applicant is
13 going to have rebuttal. So, we III just make that note, and
14 wi th that, the prefiled testimony of Ms. Seaman is spread upon
15 the record as if read.
16 (The following prefiled direct testimony
17 of Ms. Seaman is spread upon the record.)
18
19
20
21
22
23
24
25
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SEAMAN (Di)Staff
e 1 Q.Please state your name and address for the
2 record.
3 A.My name is Grace Seaman. My business address
4 is 472 West Washington Street, Boise, Idaho.
5 Q.By whom are you employed and in what capacity?
6 A.I am employed by the Idaho Public Utilities
7 Commission (Commission) as a Utilities Analyst. I
8 accepted the position with the Telecommunications Section
9 in June 2004. I am responsible for telecommunications
10 regulatory activities.
11 Q.Please give a brief description of your
12 educational background and experience.
13e A. I graduated from George Fox University with a
Bachelors of Arts degree in Management and Organization
15 Leadership in May 1998. I have attended various
14
16 regulatory, rates of return, economics, and service
17 rating programs including the New Mexico State University
18 "Camp" NARUC.
19 I worked for Mountain Bell/US WEST for 25 years
20 in the repair, dispatch, business office and marketing
21 departments. The last 21 years were spent in the
22 marketing department, in a variety of positions that
23 included sales, service, technical, proj ect management,
24 and supervisory responsibilities.
25 Prior to accepting the position with the IPUC,
e
CASE NO. TIM-T-08-01 55
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HEDRICK COURT REPORTING
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SEAM, G. (Reb.) i
STAFF
e 1
2 at the Hewlett Packard main site. I supervised a team
I was a Site Manager for CDI, a managed service provider,
3 that was responsible for installation and maintenance of
4 structured cabling, telephone/PBX and VoIP support, and
5 data network support.
6
7
Q.What is the purpose of your testimony?
A.The purpose of my testimony is to present the
8 evidence associated with Staff's recommendation regarding
9 Time Warner Cable Information Service (Idaho), LLC's
10 (TWCIS) Application for a Certificate of Public
11 Convenience and Necessity (CPCN); Case No. TIM-T- 08 - 01.
12
e 13
14
Q.Please summarize your testimony.
A. Based on the information provided in the TWCIS
CPCN Application, Staff does not believe the services
15 that TWCIS proposes to provide in Idaho qualifies the
16 Company as a "telecommunications provider" as defined by
17 Idaho Code. TWCIS, therefore, cannot be granted a
18 Certificate of Public Convenience and Necessity (CPCN).
19
20
Q.What is TWCIS requesting in this case?
A.TWCIS is requesting that the Commission grant
21 the Company a CPCN (certificate) that will enable it to
22 operate as a competitive local exchange carrier (CLEC)
23 in the state of Idaho. CLECs compete with incumbent
25
24 local exchange carriers ("ILECs" or "incumbents").
e
Q.How does the certification process operate for
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17
18
1 CLECs?
2 A.The laws pertaining to the regulation of CLECs
3 have evolved over time. In 1988, our Legislature enacted
4 the Telecommunications Act generally providing for the
5 introduction of competition in all telecommunication
6 services with one exception: the provision of local
7 exchange service to residential and business customers
8 with fewer than five (5) access lines. For those
9 incumbent telephone corporations providing local exchange
10 service, their existing CPCNs were intended to "represent
11 an exclusive service area franchise." Idaho Code § 62-
12 615(1) (subsequently repealed in 1997). Thus, carriers
13 such as Qwest's predecessor became subject to both Title
14 61 and Title 62 - Title 61 for the provision of its basic
15 local exchange service and Title 62 for the provision of
16 all other telecommunication services.
Q.What happened next?
A.Congress enacted the federal Telecommunications
19 Act of 1996 which sought to introduce competition in all
20 areas of telecommunications, including basic local
21 exchange service. In response to the federal Act, in
22 1997 Idaho repealed Section 62-615 (1) and its "exclusive
23 franchise" language. Thus, CLECs could offer basic local
24 exchange services in competition with ILECs. In House
25 Bill 313, the Legislature restricted the Commission from
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e 1 regulating the price for basic local exchange service
2 offered by new CLECs.
3 Q.Were there subsequent changes to the regulation
4 of CLECs?
e 14
5 A.Yes. In 2005 the Legislature again amended the
6 Idaho Telecommunications Act. In House Bill No. 224, the
7 Legislature amended Sections 62-604 and 62-605 to allow
8 telephone corporations to remove their basic local
9 exchange service from the Commission's Title 61 authority
10 and have such services regulated under the Commission's
11 Title 62 authority. In 2009, the Commission promulgated
12 Rule 114 that specified the information to be included by
13 CLECs when applying for CPCN applications. As stated in
15 to register and review applicants to provide local
the Rule, the Commission "uses the certification process
17
16 telecommunications services." IDAPA 31.01.01.114.
Q.Please describe the services that TWCIS
19
18 proposes to provide in Idaho.
A.In its application, TWCIS states that it is a
20 competitive telecommunications company that intends to
21 offer intrastate telecommunications services for
22 wholesale customers statewide. Supplement at 5. That
23 is, TWCIS does not offer basic local exchange service
24 directly to end users, but offers it on a wholesale basis
25 to CLECs. TWCIS is not itself a CLEC.
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1 Q.Are CPCNs granted to companies that provide
2 services to wholesale providers?
3 A.No, CPCNs are granted to providers of local
4 exchange service as provided for in Rule 114.
5 Q.Would you please explain why you believe TWCIS
6 is not a telecommunications provider?
7 A.Yes. The Company admits to being a "wholesale
8 provider. " Supplement at 5. This means that the Company
9 provides its services to other companies and not to the
10 "public" or end users.
11 Looking at Idaho Code §§ 61-121 (1) and 62-
12 603 (14), the definition of a "telephone corporation"
13 means every corporation or person, their lessees,
14 trustees , receivers or trustees appointed by any court
15 whatsoever, providing "telecommunications services" for
16 compensation within this state.
17 The definition of "telecommunication service"
18 in Idaho Code §§ 61-121 (2) and 62-603 (13), means the
19 transmission of two-way interactive switched signs,
20 signals, writing, images, sounds, messages, data, or
21 other information of any nature by wire, radio,
22 lightwaves, or other electromagnetic means (which
23 includes message telecommunication service and access
25 and are offered to or for the public, or some portion
24 service), which originate and terminate in this state,
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1 thereof, for compensation (emphasis added) ."
2 Because TWCIS does not offer services directly
3 to the public, the service cannot then be considered
4 telephone service, and it then cannot be considered a
7
5 "telephone corporation" in accordance with the definition
6 found in Idaho Code §§ 61-121 (1) and 62-603 (14) .
Q.What does TWCIS say?
8 A.Ms. Laine states in testimony that TWCIS
9 qualifies as a "telephone corporation" under Idaho state
10 law.
11
12
13
14
Q.Do you agree wi th Ms. Laine?
A.No. The services that TWCIS proposes to
provide do not fit the services defined for a
15 testimony.
telecommunications provider as I described in my earlier
16 Q.How has Staff defined "service to the public"
18
17 in the past?
A.Staff defines "service to the public" to mean
19 directly to the consumer or end user and not on a
21
20 wholesale basis.
Q.Is this consistent with Staff's position in the
23
22 past?
24
A.Yes.
Q.Ms. Laine states in testimony that a CPCN will
25 enable TWCIS to provide facilities-based wholesale and
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e 1 retail intrastate telecommunications services to
3
2 commercial customers in Idaho. Do you agree?
A.No, a CPCN is not necessary to provide
4 wholesale services and TWCIS has not shown that it will
6
5 be providing retail services to the public.
Q.Ms. Laine also states in testimony that there
7 is nothing in Idaho state law that precludes the
8 commission from granting the requested CPCN. Do you have
10
9 an opinion on this matter?
A.No. This is a legal matter that should be
12
11 argued through briefs submitted by legal counsel.
--13
14
Q.In the supplement to the Application on page 7,
TWCIS asserts that "finding TWCIS ineligible for a CPCN
based on a cramped reading of Title 61 and 62 would run
15 afoul of federal law and undercut important policy
17
16 objectives." Do you agree?
A.No. Idaho statutes allow easier entry into the
18 market than the federal Act. Therefore,. the Commission
19 cannot be considered guilty of "running afoul" of federal
20 law and "undercutting important policy objectives" if a
21 certificate is not granted, as suggested by TWCIS. Staff
22 does not believe the state's lack of regulatory
23 requirements, that is, no need for a CPCN or price list,
25
24 can be viewed as a barrier to entry.
e
Q.Ms. Laine states in testimony that TWCIS will
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1 not be able to enter the Idaho market without a CPCN. Is
2 this an accurate statement?
3 A.No. Staff advised representatives of TWCIS
4 that the absence of a CPCN does not preclude the Company
5 from entering the Idaho market as a wholesale provider,
6 nor should it prevent it from entering into
7 interconnection agreements.
8 Q.Ms. Laine further states in testimony that the
9 Commission has previously granted CPCNs to other
10 applicants that proposed to offer services comparable to
11 those proposed by TWCIS. Specifically, she cites CPCNs
12 granted to ALEC Telecom, Inc. and Eltopia Communications,
13 LLC. Please explain why these companies were granted a
14 certificate.
15 A.ALEC Telecom, Inc. was granted a certificate on
16 November 13, 2009, for the following reasons: 1) In the
17 Application, under the heading telecommunications
18 service, item 2, Alec states that its future plans are to
19 expand its offering to retail, private line service, and
20 residential customers. Applicant may also provide local
21 telecommunications services on a resell basis; 2) On page
22 1 of the illustrative tariff is the following statement:
23 "This price list sets forth the service offerings, rates i
24 terms and conditions applicable to the furnishing of
25 local exchange services to small business customers
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e 1 within the State of Idaho. The rates and rules contained
2 herein are subj ect to change pursuant to the rules and
3 regulations of the Idaho PUC; and 3) On page 12 of the
4 illustrative tariff, under the heading Eligibility of
5 schools and libraries, is the statement, "(s) ervices will
6 not be sold, resold or transferred in consideration for
7 money or any other thing of value." These statements
8 indicated to Staff that the company intended to provide
9 basic local exchange services to small business customers
10 and future plans could include residential customers.
11 Eltopia Communications, LLC was granted a
12 certificate on September 24, 2007, for the following
13 reasons: 1) The Company had already negotiated ane14interconnection agreement with Northwest Telephone, Inc
15 and Verizon Northwest, Inc.; 2) In the illustrative price
16 list is the following statement: "This price list sets
17 forth the service offerings, rates, terms and conditions
18 applicable to the furnishing of local exchange services
19 to residential and small business customers within the
20 Cour d' Alene (sic), Idaho Service Area. The rates and
21 rules contained herein are subject to change pursuant to
22 the rules and regulation of the Idaho PUC;" and 3) The
23 illustrative tariff contained categories and rates for
24 directory listings. Directory listings are typically
25 associated with the public or end users.
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2 regarding these companies?
3 A.Yes. Staff recognizes that some companies,
4 that obtained certificates in the past, may have been
5 wholesale service providers. Staff has tried to judge
6 all CPCN applications using the same criteria (telephone
7 companies who plan to provide local exchange services to
S the public). Staff realized during the review process
10 described in the application, and as a result, Staff
9 that some companies did not intend to provide services as
11 began stipulating certain conditions as a requisite to
e 13
12 recommending CPCN approval. The certificates are now
14
granted on a conditional basis as follows: (1)
compliance with the Number Pool Administrator and Order
15 No. 30425 mandating number resource utilization forecast
16 (NRUF) reporting; (2) contribution to the Idaho Universal
17 Service Fund (USF) , Idaho Telecommunications Relay System
IS (TRS) , Idaho Telephone Service Assistance Program
19 (ITSAP), and any future reporting requirements deemed
20 appropriate for competitive telecommunication providers;
21 (3) filing a final and complete price list with the
22 Commission containing all of its rates, terms, and
23 conditions; and (4) an agreement from the Company to
24 relinquish its certificate and any telephone numbers if,
25 wi thin one year of the issuance of a CPCN, the Company is
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2 in Idaho.
not offering local exchange telecommunications services
3 These conditions were adopted after Eltopia was
4 granted a certificate, and included in the order for
5 ALEC's certification.
6 Q.Ms. Laine states in testimony that the denial
7 of a CPCN would leave TWCIS without the ability to obtain
S telephone numbers, route calls, and obtain other inputs
9 necessary to operate as a CLEC. Please comment on this
10 statement.
11 A.I am not a numbering subj ect m~tter expert, but
12 agree that a wholesale service provider may not be able
e 13
14
to obtain numbers. However, the companies that TWCIS
16
15 service to end users, should be able to obtain numbers.
provides wholesale service to, the companies providing
Q.Ms. Laine states that one of the obstacles that
17 TWCIS would face without a CPCN is precluding
19
1S interconnection. Is this an accurate statement?
A.No. A lack of a CPCN should not prevent the
20 Company from entering into interconnection agreements.
21 Interconnection is governed by Section 251 of the Federal
22 Act of 1996.
23 Q. An Exhibit "A" is included in Ms. Laine's
24 testimony. Have you reviewed this exhibit?
25 A. Yes.
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1
2
Q.Please describe the exhibit.
A.Exhibit A is a letter dated April 29, 2010,
3 from Verizon Global Wholesale and addressed to Mark Swan,
4 Time Warner Cable (sic) regarding an interconnection
5 agreement. In the letter, Mr. Swan states that "despite
6 several requests for the information, we have not
7 received the required certification information needed to
8 execute, deliver and file the Interconnection Agreement
9 documents. Therefore, Verizon considers the
11
10 Interconnection Agreement documents non-operational."
13
12 relates to the Verizon letter?
Q.Do you have additional information as it
14
A. Yes. In a conversation with a Verizon public
policy representative on May 26, 2010, I was given
15 additional information regarding the issuance of the
16 April 29, 2010 letter. I was informed that during
17 negotiations between the two companies, TWCIS advised
18 Verizon that it intended to provide local exchange
19 services to end-user customers in Idaho. Based on this
20 information, Verizon advised TWCIS that a CPCN would be
21 required to execute the agreement. Verizon, however,
22 confirmed that TWCIS, as a wholesale provider, would not
23 be required to obtain a CPCN to enter into an
25
24 interconnection agreement.
Q.Ms. Laine states in testimony that federal law
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1 does not preclude the Commission from granting the
2 requested CPCN. She goes on to state that the
3 Communications Act of 1934, as amended, establishes a
4 clear nationwide policy in favor of competition and
5 expressly prohibits state legal requirements that
6 prohibit or have the effect of prohibiting competitive
7 entry by new service providers. Does the Staff
8 recommendation prohibit competition?
9 A.No. Staff believes neither Idaho Code nor
10 Staff's position in this case places restrictions on
11 TWCIS. The Company is free to compete in the essentially
12 unregulated Idaho market at will.
13
14
15
16
17
18
19
20
21
22
23
24
25
Q. Does this conclude your rebuttal testimony in
this proceeding?
A.Yes, it does.
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1 (The following proceedings were had in
2 open hear ing . )
3 COMMISSIONER SMITH: And, Mr. Hammond, do you
4 have questions?
5 MR. HAMMOND: Yes.
6
7 CROSS-EXAMINATION
8
9 BY MR. HAMMOND:
10 On -- Ms. Seaman, on page 2 of your rebuttalQ.
11 testimony
12 COMMISSIONER SMITH: Let i s call it "direct."
13 MR. HAMMOND: Direct testimony. 1'm sorry, after
14 you went through all of that, I apologize.
15 BY MR. HAMMOND -- of your direct testimony -- youQ.
16 make a comment about how TWCIS does not qualify as a
17 telecommunications provider based upon the fact that later on
18 you discuss that it i S not providing, in your opinion, service
19 directly to the public.
20 Is that the same case with ALEC or Eltopia, who
21 were granted CPCNs, who were -- at the outset were only going
22 to be providing wholesale telecommunications services?
23 It is not the same. In the case of ALEC andA.
24 Eltopia, there are certain elements, information, in their
25 Application that leads us to believe that they will be
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1 providing local exchange services to residential and small
2 business customers.
3 Q.But at the time of their Application, wasn i tit
4 clear that the only services they would be offering were
5 wholesale telecommunications services?
6 A.No, that is not correct.
7 Q.Can you explain why; where in their Application
8 they say they will be providing some other services besides
9 wholesale telecommunications services on the date they Ire
10 granted the CPCN?
11 They specifically stated that they would beA.
12 providing local exchange services.
13 And when Staff evaluates an Application, the
14 Company is required to submit an illustrative tariff and we
15 also evaluate the content of the illustrative tariff in our
16 evaluation, and in the illustrative tariff in both cases, there
17 was evidence that they intended to provide basic local exchange
18 services as defined by Idaho Code.
19 Were they going to offer local exchange servicesQ.
20 at the beginning of their business practices in Idaho?
21 I believe one company said that they intended toA.
22 provide.
23 Do you know whether or not those companies areQ.
24 actually providing those services?
25 No, we do not. At this point, Eltopia and ALECA.
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1 Communication Services submitted their CPCNs and we have not
2 had an opportunity to evaluate their actual practices based on
3 what they said they would provide in their Application.
4 Q.So in those Orders where they were granted a
5 CPCN, was there a sort of a probationary period to determine
6 whether or not they were providing those services that you
7 required to be offered the CPCN?
8 A.Not in the case of Eltopia; however, there were
9 Stipulations in the Order granting CPCN for ALEC.
10 Would a year period of time be the period of timeQ.
11 that they would have to provide those services? Is that
12 familiar to you or do you recall that?
13 A.We use the year as a standard.
14 And have you done any review of that issue wi thinQ.
15 the year?
16 I am not certain that a year has -- that it hasA.
17 been a year since the Order was issued for either one of those.
18 What if I told you the Application -- or, theQ.
19 CPCN for Eltopia was granted in 2008 or 2007. That seems to be
20 longer than a year, doesn i tit?
21 A.Yes, it does.
22 So for all you know at this point in time, theQ.
23 only services that ALEC or Eltopia are providing are wholesale
24 telecommunications services?
25 A.I don i t know that for a fact, no.
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i Q. But yet the CPCN was still -- you recommended
2 that a CPCN or the Staff recommended that the CPCN should be
3 granted to each of those carriers?
4 A.Staff did recommend that, yes.
5 Q.You mention on page 4 of your direct testimony at
6 line 11 and 12 that the Commission promulgated Rule 114 to
7 govern situations regarding the certification process for CLECs
8 to obtain the CPCN.
9 Isn't it true that the Company, Time Warner,
10 filed its Application prior to the promulgation of those Rules?
11 A.Yes, it did. Prior to Rule 114, we also had
12 Commission Order No. 26665.
13 Q.So to the extent there i s something in 114 that
14 would cut against the Petition or the Application for Time
15 Warner, that Rule was not in effect at the time the Application
16 was filed. Is that correct?
17 A. That i s correct.
18 Q. SO are you suggesting that there i s some sort of
19 retroactive Application of that Rule to the Application?
20 A.No, I am not. What Rule 114 does is it states
21 that the CPCN or the certification process is a process to
22 register and review Applicants, which was not the wording in
23 Commission Order 2665 -- 2665 (sic).
24
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Q.On page 6 of your rebuttal -- or, excuse me, 1'm
going to do that again -- page 6 of your direct testimony, you
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1 discuss on line 16 and 17 and thereon down what service to the
2 public means, and you state that service to the -- in Staff IS
3 eyes or Staff i s view, it i S service directly to a end user.
4 Are you aware of any Commission Order that has
5 adopted the view of Staff in that light.
6 A.It has always been the Commission's position that
7 the basic local exchange service means residential and small
8 business customers; and for Staff, that also means end users.
9 Q. Are you aware of any Commission Order that has
10 adopted that view?
11 A.No. We go by Idaho law.
12 Q.So you don't know, is what you i re saying; you
13 don i t know that the Commission has actually adopted that. In
14 fact, it i S Staff' s position, but nothing written down in a
15 Commission Order?
16 A.I i m unaware that it is in any Commission Order;
17 however, it has been the consistent application of that
18 interpretation with Staff as they review CPCN Applications.
Q.So Staff, but not the Commission, as far as we
20 know?
21 MR. PRICE: Obj ection: Asked and answered,
22 several times.
23 COMMISSIONER SMITH: It i S my favorite obj ection.
24 Sustained.
e 25 Q.BY MR. HAMMOND: At page 10 (sic) of your direct
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21
1 testimony, line 3, you talk about the other issues that Time
2 Warner is concerned about in getting a CPCN, the numbering
3 issues, aside from the ICA. Are you aware whether or not, in
4 your experience, they can obtain these items without a CPCN?
5 A.I i m aware that they may have difficulty.
6 Q.On page 12 of your direct testimony, line 13, you
7 discuss your conversation with a Verizon public policy
8 representati ve. Can you identify who that was?
9 A.Renee Willer.
10 Q.Can you tell us whether or not Ms. Willer had any
11 contact with the folks that were negotiating directly
12 negotiating -- this Interconnection Agreement?
13 A.From the Company -- Time Warner Communication
14 Information Systems (sic), the TWCIS -- is concerned, 11m not
15 aware that she has. She did indicate to me that she was in
16 contact with a Verizon representative negotiating directly with
1 7 the Company.
18 Q.So Ms. Willer didn i t have any personal experience
19 for any participation in that negotiation process?
A.No, she did not.
I i d like to amend that response: I i m not aware
22 that she did or did not.
23 Q.Did you attempt to contact the people at Verizon
24 who directly negotiated this Agreement?
e 25 A.No, I did not.
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1 Q.Why not?
2 We deal directly with Ms. Willer, and I was notA.
3 familiar with the person that was negotiating directly with the
4 Company.
5 MR. HAMMOND: That i s all I have. Thank you,
6 Commissioner Smith.
7 COMMISSIONER SMITH: Sure.
8 Do we have questions from the Commission?
9 COMMISSIONER REDFORD: No.
10 COMMISSIONER SMITH: Commissioner Kempton.
11
12 EXAMINATION
13
14 BY COMMISSIONER KEMPTON:
15 Ms. Seaman, going back to the CPCNs for ALEC andQ.
16 Eltopia, was there any -- I know that the question has been
17 asked; I just want to refresh this in my own mind. There was
18 no time line that was established at which time the Commission
19 would go back and review whether either one of those utility --
20 those Companies would have complied with the Commission Order.
21 Is that correct?
22 There was no time frame set for CommissionA.
23 review, that's correct.
24 And the issuance of the CPN (sic) in both casesQ.
25 was a conditional CPN (sic). Is that correct?
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1 Not in the case of Eltopia, but we did beginA.
2 adding the conditions in 2009 and did so with ALEC.
3 And the conditional factor, even though it wasn i tQ.
4 a conditional CPN (sic), but the issue that allowed you to move
5 forward on that was that Eltopia would do what? Hadn i t they
6 negotiated some preliminary contracts or issued a tariff in
7 that regard, initial tariffs or a preliminary tariff?
8 They submitted an illustrative tariff with theA.
9 Application.
10 COMMISSIONER KEMPTON: I have no further
11 questions, Madam Chair.
12 COMMISSIONER SMITH: Thank you.
13
14 EXAMINATION
15
16 BY COMMISSIONER SMITH:
17 Well, Grace, I guess I find it highly ironic thatQ.
18 in Idaho, which I think has attempted to be the most open for
19 entry for telecommunications providers, that we find ourselves
20 in this hearing room today, because telecommunications has been
21 on a steady road of deregulation, less regulatory oversight,
22 since the early i 80s; and, of course, we want all comers,
23 because that helps consumers.
24 So do you have any practical suggestions for us
25 regarding the Commission i s responsibility to comply with State
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1 law and give meaning to the plain language that resides therein
2 and our desire to have all comers providing services in our
3 state to the benefit of the consumers that are here? 11m a
4 very practical person, so what i s the way out of this?
5 Commissioner Smith, I don i t know that I have aA.
6 good response to that question. I do think that from a Staff
7 standpoint we are limited by Idaho law, and perhaps that i s
8 where we start.
9 Q.Okay. Thank you.
10 COMMISSIONER SMITH: Do you have any redirect,
11 Mr. Price?
12 MR. PRICE: Thank you, Madam Chair. I have a few
13 questions.
14
15 REDIRECT EXAMINATION
16
17 BY MR. PRICE:
18 Ms. Seaman, historically, has the CommissionQ.
19 regulated wholesale providers?
20 A.No.
21 Okay. And there was a lot of discussion aboutQ.
22 the Applications of ALEC, Incorporated, and Eltopia
23 Communications and perhaps other wholesale providers that may
24 be out there operating right now with CPCNs that aren i t
25 actually providing end-user service. Does the Commission
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e 1 Staff is it planning on reviewing those cases?
2 A.Yes, we are.
3 Q.And what steps will the Staff take during that
4 review?
5 A.We will be taking a look at all of the CLEC
6 companies, and from there the steps are unclear. As a Staff,
7 we need to meet and determine exactly what those steps will
8 be.
9 Q.Okay. But if the Staff becomes aware of
10 information dealing with these wholesale providers operating
11 out there and that theyl re not providing that direct end-user
12 service, what would Staff i s response be ultimately?
e 13 A.Could you repeat the question, please?
14 Q.If Staff becomes aware of these wholesale
15 providers in Idaho that are currently operating out there
16 unbeknownst to Staff but becomes aware of information that
17 suggests that they i re not providing end-user -- direct end-user
18 service, what would Staff iS ultimate response to that be?
19 A. If they are one of the companies where we
20 stipulated the conditions for their Order, then the Company has
21 agreed to relinquish their CPCN in that case.
22 Q.Okay. And this is just a general policy
23 assessment on your behalf. Let i s say that the Commission were
24 to award companies like Time Warner a CPCN in this case apart
e 25 from the fact that it i s Staff iS position that it doesn i t have
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1 the jurisdiction and authority to do so. But if the Commission
2 were to take that action, what sort of potential pitfalls or
3 consequences could arise as a result of that Decision?
4 Simple questions would arise in my mind. If weA.
5 grant TWCIS a CPCN, how will the Commission address those other
6 wholesale companies that are operating in Idaho without a CPCN?
7 How will the Commission treat other companies
8 that are not wholesale providers but still wish to obtain a
9 CPCN, and I give examples such as Internet service providers,
10 nomadic VoIP service providers.
11 We are also concerned about number exhaustion.
12 This Commission in the past has supported conservation of
13 telephone numbers to forestall number exhaust. That would be a
14 concern.
15 And then, finally, my final concern is that we
16 have to follow Idaho law, and it does not allow us to grant the
17 CPCNs.
18 MR. HAMMOND: Commissioner Smith, 11m going to
19 object to that last answer.
20 COMMISSIONER SMITH: And that obj ection is
21 sustained. The witness can i t throw out a legal conclusion.
22 BY MR. PRICE: Okay. Welve heard testimony todayQ.
23 from Ms. Laine that Time Warner i s customer base almost
24 exclusively will be fixed VoIP providers. Has the Commission
25 awarded CPCNs to fixed VoIP providers in the past?
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1 A.Yes.
2 Q.Can you cite to any specific cases?
3 A.One of the first cases was
4 MR. HAMMOND: Commissioner Smith, I think 11m
5 going to obj ect here. I think this is beyond the scope of my
6 cross.
7 COMMISSIONER SMITH: And I was thinking the same
8 thing, Mr. Hammond, so I was going to give you the opportunity
9 for additional cross-examination, because this does seem more
10 like additional direct questions. But I think the information
11 is useful to the Commission, and if you need more time, we III
12 be happy to recess and give you more time.
13 MR. HAMMOND: Thank you, Commissioner Smith.
14 BY MR. PRICE: Go ahead.Q.
15 MR. PRICE: 1111 withdraw it.
16 COMMISSIONER SMITH: But I want the answer.
17 MR. PRICE: Okay. Well -- I think it i S useful as
18 well: That i s why I asked it.
19 COMMISSIONER SMITH: Well, it would have been
20 better if you would have asked it at the beginning after you
21 spread the testimony.
22 MR. PRICE: Yes. Yes.
23 COMMISSIONER SMITH: But we can work around that.
24 MR. PRICE: Agreed.
25 BY MR. PRICE: Go ahead and answer that question.Q.
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1 One of the first VoIP companies that we granted aA.
2 ÇPCN to was to Cox Idaho Telecom, LLC. That was granted in
3 April of 2006.
4 One of the more recent VoIP service providers was
5 Millennium Networks, LLC, and that was granted in May of this
6 year.
7 Okay. And, finally, my last question and this --Q.
8 it i S more along the lines of admitting your communication with
9 Ms. Willer that was the subj ect of cross. Do you have an
10 e-mail communication from Ms. Willer in front of you?
11 Yes, I do.A.
12 MR. HAMMOND: Commissioner Smith?
13 COMMISSIONER SMITH: Yes, Mr. Hammond.
14 MR. HAMMOND: 11m going to obj ect. I realize the
15 rules of hearsay don i t strictly apply to the Commission IS
16 proceedings, but Ms. Willer is apparently the person who
17 discussed this matter with Ms. Seaman and then wrote the
18 subsequent e-mail. As we discussed in cross, we i re not certain
19 who she spoke to about the interconnection process or the
20 negotiation process. I i m not sure that what has been laid for
21 foundation at this point is sufficient to establish the
22 reliabili ty of that information, so --
23 MR. PRICE: I would agree to that.
24 COMMISSIONER SMITH: Mr. Price.
25 MR. PRICE: I haven i t moved for it to be
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1 admitted. 11m going to lay the foundation. I would say that
2 it i S not -- I i m not going to move to admit it for the purpose
3 of an affirmation of the truth of the matter; I i m simply going
4 to move to admit it as a document that Ms. Seaman can
5 authenticate.
6 COMMISSIONER SMITH: Mr. Hammond.
7 MR. HAMMOND: I think that i s about the same
8 thing. He i s trying to enter the document into the record.
9 She can testify and has already in her direct as
10 to her communication with Verizon, but adding this additional
11 document I think is -- for illustrative purposes is or to
12 authenticate her remark, Ms. Willer could be here to testify on
13 that issue if that IS, you know, the case.
14 COMMISSIONER SMITH: But I think he i s not --
15 well, let i s let him lay the foundation. Then we can argue
16 about -- we can discuss -- what the purpose of any potential
17 exhibi t might be.
18 MR. PRICE: Well, in the interest of expediency,
19 I i 11 go ahead and just withdraw that question, withdraw the
20 exhibit, and I have no further questions.
21 COMMISSIONER SMITH: Thank you, Mr. Price.
22 There has been some information that has come out
23 of this I think we i 11 call it additional direct. Do you have
24 any cross or would you like a few moments, Mr. Hammond?
25 MR. HAMMOND: I just had a couple questions to
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e 1 clarify.
2
3 RECROSS-EXAMINATION
4
5 BY MR. HAMMOND:
6 Q.I guess you discussed those VoIP providers that
7 had come and applied. Is it the Staff iS position that they
8 need to come and apply for a CPCN?
9 A.No. We don i t regulate VoIP service providers.
10 However, if they, on their own volition, apply for a CPCN, then
11 we will evaluate it.
12 Q.Addi tionally, you had discussed the ALEC and
e 13 El topia cases. In those cases, would you say that Staff iS
14 recommendation was sort of a flexible one, recognizing that
15 they may not be providing basic local exchange at the point in
16 time of the grant of the CPCN, but at some point in the future
17 they may, so giving them the benefit of the doubt, there was
18 flexibili ty granted in there or offered in the process of
19 getting a CPCN? Is that -- was Staff taking a more flexible
20 approach, I guess is the question, rather than requiring basic
21 local exchange service being offered from the outset?
22 A.Staff i S goal is to be consistent in evaluating
23 all of the CPCN Applications. In the case of these two
24 companies, based on the information they provided in their
e 25 Application and in the illustrative tariff, it was our belief
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22
23
1 that they would be or will be providing basic local exchange
2 services to residential and/or small business customers at the
3 time we evaluated the Applications.
4 Q.Isnlt it true that in both Applications, both
5 stated they would be providing those services at the outset?
6 A.Please repeat the question.
7 Q.Isn i t it true that in the Applications for both
8 of those characters or, characters, I'm sorry -- for both of
9 those carriers, that there was no representation? In fact,
10 their only representation was that they would be providing
11 wholesale telecommunications services at that time.
12 A.I disagree.
13 Q.The -- in regard to the process, when I asked
14 whether it was a more flexible process, was the new process
15 adopted to recognize that these things are fluid at some point
16 in time?
17 A. I don i t believe that you could classify it as a
18 new process. What we did in the case of ALEC was add
19 condi tions in the Order.
20 Q.Had that been done before?
21 A.No.
Q.Why was that done in this case?
A.It i s -- I would like to go back and say it has --
24 we began that process sometime in 2009. It was not done prior
e 25 to the first case where we added those conditions. And so your
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1 question was -- repeat.
2 Q.Well, I think you answered the question.
3 A.Okay.
4 Q.I guess the question then is Staff has worked
5 wi th other carriers to attempt to work through this problem in
6 order to promote competition, I guess, in the event they needed
7 a CPCN?
8 A.I don i t understand what you mean by "work
9 through."
10 Q.Well, obviously, there was some negotiation
11 process with ALEC and Eltopia. Did Staff have concerns that
12 they weren i t going to provide the services that you thought
13 were required?
14 A. In the case of ALEC, they did not agree to those
15 condi tions. Those were conditions that Staff recommended be
16 added to the Order. We are doing that on all CPCNs. It i S not
17 a condition of whether we feel they are wholesale providers or
18 retail providers.
19 Could you work with Time Warner in that regard,Q.
20 Time Warner Cable Information Services? Could you apply the
21 same process that you applied in ALEC to this case?
22 No, because we have to work within the IdahoA.
23 Statute and the definition of what a local exchange service
24 provider is.
25 MR. HAMMOND: 11m going to object to that answer
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1 as being nonresponsive. She i s made a legal conclusion about
2 what their --
3 COMMISSIONER SMITH: Well, I donlt think it's
4 a--
5 Oh, Mr. Price, I should let you take this.
6 MR. PRICE: I don i t think it calls for a legal
7 conclusion. She i s simply saying that --
8 COMMISSIONER SMITH: Could you use your
9 microphone, please?
10 MR. PRICE: I i m sorry. I don i t think it calls
11 for a legal conclusion. I think Ms. Seaman, what she i s trying
12 to express, is that Time Warner doesn i t meet the threshold
13 requirement in order to be subj ect to those conditions, and so
14 their case is distinct.
15 COMMISSIONER SMITH: Well, and Mr. Hammond, I
16 think she 's just trying to explain the Staff i s process and
17 processing of Applications in response to your questions. To
18 the extent there i s any legal conclusion, the Commission will
19 disregard that, because she i s clearly not here to do that.
20 BY MR. HAMMOND: Going back to your commentsQ.
21 about the VoIP providers who have applied before, is it your
22 position or Staff iS position -- I don't want to speak for,
23 obviously, the Commission but would Staff support a
24 Application from TWCIS as a VoIP provider if it were to apply
25 for a CPCN?
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1 If the Application met the requirements ofA.
2 Rule 114 and the services that it intends to provide, yes.
3 You had stated earlier that, you know, theQ.
4 Commission or the Staff doesn i t feel it regulates VoIP. Can
5 you explain how it i s different for them to -- for you to
6 support a Petition for a VoIP -- or, a Petition, excuse me
7 Application for a VoIP provider which admittedly you say you
8 don i t regulate and then take a different position with regard
9 to Time Warner?
10 We go back to the FCC, and the FCC has not yetA.
11 made a determination on who has jurisdiction over VoIP service
12 companies.
13 MR. HAMMOND: We don i t have anything further.
14 Thank you, Commissioner Smith.
15 COMMISSIONER SMITH: Thank you, Mr. Hammond.
16 Do the questions generate any more comments from
17 the Commissioners?
18 (The witness left the stand.)
19 COMMISSIONER SMITH: All right. It appears, to
20 me, that there is nothing further to bring before the
21 Commission in this hearing. I would ask the parties: Do we
22 need briefs on any legal issues after the hearing and, if so,
23 let i s identify those issues and set a deadline. Mr. Price?
24 Mr. Hammond?
25 MR. HAMMOND: I think our client would like the
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1 opportuni ty to brief some of these legal issues that have come
2 up.
3 COMMISSIONER SMITH: Okay. And can you
4 articulate what you think those issues are?
5 MR. HAMMOND: Well, I believe some of those
6 issues are the Federal background here with relation to what is
7 service to the public, what and why in this case that is
8 important, since Staff i s basis for testimony largely to deny
9 the CPCN is that they are not a telecommunication provider,
10 they are not providing a telecommunication service.
11 In addition, we i d like to address some of the
12 issues that were raised in those ALEC cases in this case, at
13 least compare. And, actually, I can think of some other
14 things, but do you have any other --
15 MS. LAINE: No, I think that i s right, in
16 particular the notion that a wholesale provider is not a
17 telecommunications carrier, the allegation that that i s the case
18 we i d like to address.
19 COMMISSIONER SMITH: Mr. Price, do you have
20 anything to add?
21 MR. PRICE: Well, I don i t know that I would agree
22 with the assertion that this is a Federal -- there are Federal
23 issues involved here. I think the Commission is constrained,
24 that its authority is circumscribed, and that the issues should
25 be limited to Idaho State law and the Commission i s Rules and
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1 procedures.
2 COMMISSIONER SMITH: Well, I think the background
3 though might be useful as to what i s going on; might not be
4 dispositive. So, how soon?
5 MR. HAMMOND: Two weeks.
6 COMMISSIONER SMITH: I don i t have a calendar,
7 so -- that would be the 30th?
8 MR. PRICE: Is that 4th of July week?
9 MR. HAMMOND: Actually, let i s think about that.
10 COMMISSIONER SMITH: I think that would be about
11 the 30th, wouldn't it?
12 MR. HAMMOND: I i m going to be in a trial on the
13 30th, so --
14 COMMISSIONER SMITH: 29th.
15 Wendy, we can go off the record.
16 (Discussion off the record.)
17 COMMISSIONER SMITH: We i 11 go back on the record,
18 and the date for filing simultaneous posthearing briefs will be
19 July 9th.
20 Is there anything else to come before the
21 Commission?
22 MR. HAMMOND: I i d just offer one comment: I do
23 believe Staff has -- and it's my opinion, but Staff has looked
24 at some of these Applications and tried to be flexible in the
25 CPCN process, in looking at ALEC and Eltopia. I think they
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1 have done an admiral job, recognizing that there are issues out
2 there and that one-size-fi ts-all process doesn i t necessarily
3 work all the time. And so with that in mind, I i d like the
4 Commission to keep its mind open in that regard, that its own
5 Staff has looked at these issues, tried to be open with these
6 issues, when it comes to a Decision in this matter. Thank you.
7 COMMISSIONER SMITH: The Commission will consider
8 everything carefully.
9 We thank you all for your participation. It i s
10 been a pleasure to have you here. And the hearing is adj ourned
11 and we look forward to your briefs.
12 (TWCIS Exhibit A, having been premarked
13 for identification, was admitted into evidence.)
14 (The hearing was adjourned at 11:15 a.m.)
15
16
17
18
19
20
21
22
23
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25
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e 1 AUTHENTICATION
2
3
4 This is to certify that the foregoing is a
5 true and correct transcript to the best of my ability of the
6 proceedings held in the matter of the Application of Time
7 Warner Cable Information Services (Idaho), LLC, for a
8 Certificate of Public Convenience and Necessity to provide
9 local exchange and interexchange telecommunications services
10 within the state of Idaho, Case No. TIM-T-08-01, commencing on
11 Thursday, June 10, 2010, at the Commission Hearing Room, 472
12 West Washington, Boise, Idaho, and the original thereof for the
e 13 file of the Commission.
14 Accuracy of all prefiled testimony as
15 originally submitted to this Reporter and incorporated herein
16 at the direction of the Commission is the sole responsibility
17 of the submitting parties.
18
19
20
21
22
I23:
24
e 25
~"..
WENDY J.
in and for
\residing at
My Commission
Idaho CSR No.
90
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AUTHENTICATION
e
Scott Miles
Contract Management
Verizon Global Wholesale
VIA FEDEX OVERNIGHT
\ ~..~on
Verizon Global Wholesale
600 Hidden Ridge
HQWMNOTICES
Irving, TX 75038
Phone [phone]
Fax [phone]
Scott.Miles(§verizon.com
April 29, 2010
Time Warner Cable
Mark Swan
7800 Crescent Executive Drive
Charlotte, NC 28217
Subject:NOTICE OF NON-OPERATIONAL DOCUMENTS AND RETURN OF
ORIGINAL DOCUMENTS
e
On September 3, 2009, Verizon received executed signature pages for Time Warner
Cable Information Services (Idaho), LLC's ("TWCIS") Interconnection Agreement
documents for the State of Idaho. However, despite several requests for the
information, we have not received the required certification information needed to
execute, deliver and file the Interconnection Agreement documents. Therefore, Verizon
considers the Interconnection Agreement documents non-operationaL.
Enclosed are your voided, executed signature pages. Once LWCIS has received
certification to be a provider of local exchange service, please submit a written request
for Negotiations to:
Kathleen Robertson
Verizon Global Wholesale - Interconnection Negotiations
600 Hidden Ridge, HQE03D44
Irving, TX 75038
Telephone: [phone]
Fax: [phone]
E-Mail: contract.managementtIverizon.com
e
NOTICE OF NON-OPERATIONAL DOCUMENTS AND RETURN OF ORIGINAL DOCUMENTS (lCIS)
April 29, 2010eAs per the Telecommunications Act of 1996, the request date wil be the date Verizon
receives the written request.
Sincerely,
.xlø-l.~
Scott Miles
Contract Management
Verizon Global Wholesale
Enclosures (4)
Cc: Time Warner Cable
Julie P. Laine
60 Columbus Circle
New York, NY 10023
e
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2
e SIGNATURE PAGE
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of
the Effective Date.
TIME WARNER CABLE INFORMATION
SERVICES (IDAHO), LLC
By;zÆ'JfJ)
VERIZON NORTHWEST INC.
By:
Printed: Gerald D. Campbell Printed: Jeffrey A. Masoner
Title: EVP, Commercial Services Title: Vice President -Interconnection Services
e
e
2009_11_05_ TWCIS (ID) VZ Comprehensive ICA Ver3.3-1-ID.doc 27
e SIGNATURE PAGE
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of
the Effective Date.
TIME WARNER CABLE INFORMATIONSERVICES (IDAHO), LLC V
By~~£1
ì
VERIZON NORTHWEST INC.
By:
Printed: Gerald D. Campbell Printed: Jeffrey A. Masoner
Title: EVP, Commercial Services Title: Vice President -Interconnection Services
e
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2009_11_05_ TWCIS (ID) VZ Comprehensive ICA Ver3.3-1.ID.doc 27
e
IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to be
executed as of the Amendment Effective Date.
TIME WARNER CABLE INFORMATION
SERVICES (IDAHO), LLC
VERIZON NORTHWEST INC.
~wBy: . ~/ßI~By:
Printed: Gerald D. Campbell Printed: Jeffrey A. Masoner
Tite: EVP, Commercial Services Tite: Vice President -interconnection Services
e
e
Rate Plan B Amendment v062708 5
e
IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to be
executed as of the Amendment Effective Date.
TIME WARNER CABLE INFORMATION
SERVICES (IDAHO), LLC
By: ~9J ~/':)
Printed: Gerald D. Campbell
Tite: EVP. Commercial Services
e
e
Rate Plan B Amendment v062708
VERIZON NORTHWEST INC.
By:
Printed: Jeffrey A. Masoner
Title: Vice President - Interconnection Services
5