Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | * | CC Docket No. 98-147         |
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**FOURTH REPORT AND ORDER**

**Adopted:** July 12, 2001 **Released:** August 8, 2001

By the Commission: Commissioner Abernathy not participating;
Commissioner Martin approving in part, concurring in part, and issuing a
statement.

*Para*.

I. Introduction 1

II\. BACKGROUND 3

III\. executive summary 12

IV\. Discussion 13

A. Overview 13

B. "Necessary" Equipment under Section 251(c)(6) 15

1\. Background 15

2\. Meaning of "Necessary" 18

3\. Relationship with Sections 251(c)(2) and 251(c)(3) 27

4\. Multi-functional Equipment 32

5\. Other Equipment 44

C. Cross-Connections Between Collocators 55

1\. Competitive LEC Self-Provisioning of Cross-Connects 61

2\. Incumbent LEC Provisioning of Cross-Connects -- Section 201 62

3\. Incumbent LEC Provisioning of Cross-Connects -- Section 251 79

D. Space Allocation and Access 85

1\. Background 85

2\. Space Assignments 89

3\. Separate Rooms and Entrances 98

V. procedural matters 105

A. Final Regulatory Flexibility Analysis 105

B. Final Paperwork Reduction Act Analysis 106

VI\. ORDERING CLAUSES 107

APPENDIX A -- LIST OF PARTIES A-1

APPENDIX B -- FINAL RULES B-1

APPENDIX C --Final Regulatory Flexibility Analysis C-1

# Introduction

1.  In this Order, we reevaluate provisions of our collocation rules on
    remand from the United States Court of Appeals for the District of
    Columbia Circuit. The remanded rules determined which equipment an
    incumbent local exchange carrier's (incumbent LEC's) competitors
    might collocate in the incumbent's premises pursuant to section
    251(c)(6) of the Communications Act of 1934, as amended
    (Communications Act or Act).[^1] Those rules also required that an
    incumbent LEC allow collocating carriers to install and maintain
    cables connecting different carriers' collocated equipment within
    the incumbent's premises.[^2] In addition, the remanded rules
    allowed requesting carriers to determine where within the incumbent
    LEC's premises their physical collocation space will be located,
    precluded the incumbent from restricting physical collocation to
    separate or isolated rooms or floors, and precluded the incumbent
    from requiring the construction of separate entrances for physical
    collocators to use in accessing their own equipment.

2.  On remand, we conclude that equipment is "necessary for
    interconnection or access to unbundled network elements" within the
    meaning of section 251(c)(6) and thus may be collocated if, absent
    deployment of the equipment, the requesting carrier would, as a
    practical, economic, or operational matter, be precluded from
    obtaining "equal in quality" interconnection or "nondiscriminatory
    access" to unbundled network elements from the incumbent LEC. We
    also limit which multi-functional equipment a requesting carrier may
    collocate. We further conclude that while an incumbent LEC need not
    allow collocators to install and maintain cross-connects between
    different carriers' collocated equipment, an incumbent LEC itself
    must provide these cross-connects upon reasonable request. We
    conclude, in addition, that an incumbent LEC may decide where
    collocated equipment will be placed within its premises as long as
    the incumbent acts reasonably and nondiscriminatorily, and we
    specify minimum standards defining reasonable and nondiscriminatory
    behavior in this context. We also determine that an incumbent LEC
    may separate the space physical collocators occupy and the entrances
    to that space from other space and entrances within its premises,
    except in certain limited circumstances.

# BACKGROUND

3.  In general, in order to interconnect with an incumbent LEC or to
    access an incumbent LEC's unbundled network elements, competitors
    must be able to directly access the incumbent's facilities with
    their own equipment. The most practical and efficient places in an
    incumbent's network where this direct access can occur are those
    centralized points where individual, subscriber-generated
    telecommunications traffic is aggregated onto common links for
    transmitting the traffic through the network or onto other networks.
    Collocation allows competitors to place their own equipment directly
    into these centralized points on the incumbent's network.

4.  In the 1996 Telecommunications Act (1996 Act),[^3] Congress
    specifically required incumbent LECs to allow competitive
    telecommunications carriers to collocate equipment at incumbent LEC
    premises, enabling facilities-based competitors to provide a full
    array of competitive local exchange, exchange access, and other
    telecommunications services. Through its experience over the last
    five years in implementing the 1996 Act, the Commission has learned
    that only by encouraging competitive LECs to build their own
    facilities or migrate toward facilities-based entry will real and
    long-lasting competition take root in the local market.[^4] At the
    same time, the Commission has recognized that most facilities-based
    providers still require the use of some component of the incumbent's
    local network in order to be able to compete with the incumbent and
    to justify the huge investments in infrastructure that are necessary
    to build out their own telecommunications networks.[^5] In addition,
    whether or not a competitor builds a wholly-owned network or uses
    parts of the incumbent's network, most alternative providers
    inevitably must interconnect their new networks with the existing
    network of the incumbent in order for customers of both networks to
    communicate with each other. Therefore, collocation continues to
    play an essential role in fostering competitive facilities-based
    entry and expansion into the local market.[^6]

5.  Significantly, over these same five years, the rapid pace of
    development and investment in innovative technologies has ushered in
    a fundamental change in the potential services and capabilities
    available to end users. In particular, the increased use of
    packet-based technologies has begun to revolutionize the delivery of
    telecommunications services. In part as a result of opportunities
    created by the 1996 Act, a burgeoning of new technologies has
    enabled network builders to begin turning away from the traditional
    circuit switched network and its reliance on single-function
    equipment and rigid routing hierarchies. These new networks employ
    "cutting edge" developments in computing, packet technology,
    digitization, and optical transmission to offer customers both
    traditional voice services and an ever-increasing array of advanced
    services. The result has been the deployment of technologies that
    can perform more functions, at greater efficiency and higher speeds,
    than prior technologies.[^7]

6.  These changes in technology have not only resulted in the deployment
    of new equipment that was barely, if at all, used in the public
    switched telecommunications network five years ago when the 1996 Act
    was passed, but also have enabled dramatically different network
    architectures and designs. These changes in technology have enabled
    providers to choose from myriad network architectures through which
    to serve end users. Some of these networks rely on centralized hubs
    to manage traffic flows and thus resemble, despite achieving far
    greater efficiency, the networks incumbent LECs deployed prior to
    the enactment of the 1996 Act.[^8] Other network designs seek to
    migrate previously centralized functions to the network's edge.[^9]
    Still others seek to disaggregate what had previously been
    considered inseparable network functionalities into more discrete
    components that can be distributed throughout the network. [^10] In
    other words, equipment choices and the attendant network
    architectures are increasingly becoming more diverse than those
    available in yesterday's unitary, circuit-switched network
    environment. Competitors now can -- and do -- use equipment and
    network architecture to differentiate themselves. In the end, not
    all the new technologies and associated architectures may be
    sustainable. In the past, however, a single monopoly provider would
    have made this decision; now, the 1996 Act puts the decision in the
    hands of the marketplace.[^11]

7.  Indeed, we have previously recognized that, in adopting the 1996
    Act, Congress consciously did not try to pick winners or losers, or
    favor one technology over another.[^12] Rather, Congress set up a
    framework from which competition could develop, one that attempted
    to place incumbents and competitors on generally equal footing, so
    that each could share the efficiencies of an already
    ubiquitously-deployed local infrastructure while retaining
    independent incentives to deploy new, innovative technologies and
    alternative infrastructure. The obligation imposed on incumbents to
    allow for the collocation of competitors' equipment at the
    incumbents' premises is a critical, if not fundamental, component of
    this equation. Without mandatory collocation rights, competitors
    would not be able to achieve direct access to incumbent bottleneck
    facilities, and competitors would be thwarted in their ability to
    deploy alternative, innovative technologies. Such a result would
    significantly diminish one of the bedrock principles of the 1996 Act
    -- the promotion of competition to spur infrastructure investment
    and technological innovation.[^13]

8.  Through innovative technologies, the market is already bringing
    customers a broader offering of new services and capabilities.
    Because these technologies are still relatively nascent, it is
    likely that the services available in today's market are only a
    precursor to an even wider array of services that promise to be
    deployed in the near future. As a result, the types of equipment
    that competitors seek to collocate in 2001 are dramatically
    different than the equipment being collocated when the 1996 Act was
    passed. Similarly, given current trends, it is likely that the
    changes in the types of equipment required for collocation in 2006
    will continue to reflect this unparalleled speed of technological
    evolution. However, although the types of equipment being deployed
    have changed since the passage of the 1996 Act, and likely will
    continue to change, the fundamental purpose for collocation remains
    the same -- to allow competitors direct access to bottleneck
    facilities in order to provide competitive telecommunications
    services, including an ever-increasing array of new, advanced
    services.

9.  One of the 1996 Act\'s core market‑opening provisions is section
    251(c)(6) of the Communications Act, which requires incumbent LECs
    "to provide . . . for physical collocation of equipment necessary
    for interconnection or access to unbundled network elements at the
    premises of the local exchange carrier."[^14] In 1996, in the *Local
    Competition Order*, the Commission adopted rules to implement
    section 251(c)(6).[^15] These rules addressed, among other matters,
    where competitive LECs could physically collocate equipment, the
    types of equipment that could be collocated, and how incumbent LECs
    should allocate space in the event insufficient physical collocation
    space is available. While the Commission adopted specific and
    detailed national collocation rules, the Commission concluded that
    state commissions should have the flexibility to adopt additional
    collocation requirements that are consistent with the Communications
    Act and the Commission\'s implementing rules.[^16]

10. Three years later, in the *Advanced Services First Report and
    Order*, the Commission modified the collocation rules to remove
    barriers to telecommunications competition, particularly in the
    nascent advanced services market.[^17] These rules require incumbent
    LECs to expand their collocation offerings to include cageless and
    shared collocation, among other physical collocation
    arrangements.[^18] Further, when collocation space is exhausted at a
    particular incumbent LEC location, the incumbent LEC must permit
    collocation in adjacent controlled environmental vaults or similar
    structures to the extent technically feasible.[^19] The Commission
    specified, among other requirements, that a collocation method used
    by one incumbent LEC or mandated by a state commission is
    presumptively technically feasible for any other incumbent LEC.[^20]
    The Commission specified that these strengthened collocation rules
    should serve as minimum requirements and continued to recognize that
    the state commissions may adopt additional collocation
    requirements.[^21]

11. In *GTE v. FCC*, the D.C. Circuit affirmed much of the *Advanced
    Services First Report and Order*, but vacated and remanded for
    further consideration certain aspects of that Order.[^22]
    Specifically, the court vacated and remanded the requirement that an
    incumbent LEC permit collocation of any equipment that is "used or
    useful" for either interconnection or access to unbundled network
    elements, regardless of the other functionalities inherent in such
    equipment.[^23] The court also vacated and remanded the requirement
    that incumbent LECs allow competitive LECs to construct
    cross-connects outside of their immediate physical collocation
    space.[^24] Finally, the court vacated and remanded the *Advanced
    Services First Report and Order* to the extent it gave requesting
    carriers the option of selecting physical collocation space from
    among the unused space within the incumbent LEC's premises,
    prohibited the incumbent from placing collocators in a room or
    isolated space separate from the incumbent's own equipment, and
    precluded the incumbent from requiring competitors to use separate
    entrances to access their own equipment.[^25] The D.C. Circuit found
    that the remanded rules "diverge\[d\] from any realistic meaning of
    the statute, because the Commission ha\[d\] favored the
    \[incumbent\] LECs' competitors in ways that exceed what is
    'necessary' to achieve reasonable 'physical collocation' and in ways
    that may result in unnecessary takings of \[incumbent\] LEC
    property."[^26]

# executive summary

12. We take several actions in this Fourth Report and Order, including:

-   We find that equipment is "*necessary* for interconnection or access
    to unbundled network elements" within the meaning of section
    251(c)(6) if an inability to deploy that equipment would, as a
    practical, economic, or operational matter, preclude the requesting
    carrier from obtaining interconnection or access to unbundled
    network elements as contemplated in sections 251(c)(2) and
    251(c)(3).

-   We find that multifunction equipment meets the "necessary" standard
    only if the primary purpose and function of the equipment, as the
    requesting carrier seeks to deploy it, are to provide the requesting
    carrier with "equal in quality" interconnection or
    "nondiscriminatory access" to one or more unbundled network
    elements. We also find that any function that would not meet our
    equipment standard as a stand-alone function must not cause the
    equipment to significantly increase the burden on the incumbent's
    property.

-   We conclude that switching and routing equipment typically meets our
    equipment standard because an inability to deploy that equipment
    would, as a practical, economic, or operational matter, preclude a
    requesting carrier from obtaining nondiscriminatory access to an
    unbundled network element, the local loop. As a general matter, an
    incumbent LEC therefore must allow requesting carriers to collocate
    switching and routing equipment. An incumbent LEC, however,
    generally need not allow collocation of traditional circuit
    switches, which are very large pieces of equipment compared to
    newer, more advanced switching and routing equipment. We find, in
    light of the practical, economic, and operational availability of
    the relatively small switches and routers, that traditional circuit
    switches generally do not meet our equipment standard.

-   We eliminate the Commission's previous requirement, adopted pursuant
    to section 251(c)(6), that an incumbent LEC allow competitive LECs
    to construct and maintain cross-connects outside of their immediate
    physical collocation space at the incumbent's premises. We find,
    however, that sections 201 and 251(c)(6) authorize us to require
    that an incumbent LEC provision cross-connects between collocated
    carriers, and we require that an incumbent LEC provide such
    cross-connects upon reasonable request.

-   We eliminate rules that gave carriers requesting physical
    collocation the option of picking their physical collocation space
    from among the unused space in an incumbent LEC's premises, that
    precluded an incumbent LEC from restricting physical collocation to
    space separated from space housing the incumbent's equipment, and
    that precluded an incumbent from requiring the construction and use
    of a separate entrance to access physical collocation space. In
    their place, we establish principles to ensure that the incumbent
    LEC's policies and practices in assigning and configuring physical
    collocation space are consistent with the statutory requirement that
    the incumbent provide for physical collocation "on rates, terms, and
    conditions that are just, reasonable, and nondiscriminatory."[^27]

# Discussion

## Overview

13. On remand, we reinterpret section 251(c)(6) in light of the D.C.
    Circuit's opinion. In the first section below, we interpret the term
    "necessary" as used in section 251(c)(6) by determining that
    equipment is eligible for collocation only if an inability to deploy
    that equipment would, as a practical, economic, or operational
    matter, preclude the requesting carrier from obtaining
    interconnection or access to unbundled network elements as
    contemplated in sections 251(c)(2) and 251(c)(3). In the second
    section below, we adopt a revised cross-connect rule that minimizes
    the intrusion into the incumbent LEC's property interests but
    promotes Congress' overall statutory purpose in fostering
    competition and technological innovation.[^28] In the final section,
    we conclude that an incumbent LEC should have ultimate authority
    over assigning and configuring space within its premises, albeit
    with specific limitations that curtail its ability to use this
    authority in an anti-competitive manner.

14. We adopt these rule amendments to more appropriately implement the
    balances reflected in the statute, between promoting competition and
    technological innovation in all telecommunications markets, and
    establishing limits on the scope of the intrusion allowed into the
    incumbent LEC's property rights to avoid unnecessary takings of such
    property. Nonetheless, through these amended rules, we reaffirm our
    commitment to ensuring that facilities-based competitors have the
    incentive and ability to invest in alternative infrastructure and
    innovative technologies, while, at the same time, ensuring that
    incumbents retain similar incentives and capabilities.

## "Necessary" Equipment under Section 251(c)(6)

### Background

15. Section 251(c)(6) of the Communications Act requires incumbent LECs
    to permit collocation of equipment "necessary for interconnection or
    access to unbundled network elements."[^29] In the *Local
    Competition Order*, the Commission interpreted section 251(c)(6) as
    requiring incumbent LECs to permit competitors to collocate
    equipment that is "used" or "useful" for either interconnection or
    access to unbundled network elements.[^30] Consistent with this
    interpretation, the Commission concluded that competitive LECs may
    collocate transmission equipment, including optical terminating
    equipment and multiplexers, at incumbent LEC premises.[^31] The
    Commission also concluded that section 251(c)(6) does not require
    that an incumbent LEC permit the collocation of switching equipment
    or equipment used to provide enhanced services.[^32] The Commission
    recognized, however, that technological developments were tending to
    blur the line between multiplexing and switching, and indicated that
    it would reexamine the meaning of section 251(c)(6) if such action
    would further the 1996 Act's procompetitive goals.[^33]

16. In the *Advanced Services First Report and Order*, the Commission
    did in fact reexamine the meaning of section 251(c)(6) and
    determined that it should be interpreted as requiring incumbent LECs
    to allow collocation of any equipment that is "used or useful" for
    either interconnection or access to unbundled network elements,
    regardless of whether such equipment includes a switching
    functionality, provides enhanced services capabilities, or offers
    other functionalities.[^34] The Commission required incumbent LECs
    to permit collocation of such equipment as digital subscriber line
    access multiplexers (DSLAMs), routers, asynchronous transfer mode
    (ATM) multiplexers, and remote switching modules.[^35] The
    Commission also concluded that an incumbent LEC must not limit a
    competitor's ability to use all the features, functions, and
    capabilities of collocated equipment, including, but not limited to,
    switching and routing features and functions.[^36]

17. In *GTE v. FCC*, the D.C. Circuit determined that the Commission's
    interpretation of "necessary" under section 251(c)(6) "seem\[ed\]
    overly broad and disconnected from \[that provision's\] statutory
    purpose."[^37] The court held that "a statutory reference to
    'necessary' must be construed in a fashion that is consistent with
    the ordinary and fair meaning of the word, *i.e.*, so as to limit
    'necessary' to that which is required to achieve a desired
    goal."[^38] The court was particularly concerned that the
    Commission's construction "diverge\[d\] from any realistic meaning
    of the statute, because the Commission \[had\] favored the
    \[incumbent\] LEC's competitors in ways that exceed what is
    'necessary' to achieve reasonable 'physical collocation' and in ways
    that may result in unnecessary takings of \[incumbent\] LEC
    property."[^39] Concluding that the Commission's construction of
    "necessary" in section 251(c)(6) failed to meet the statutory
    standard, the court vacated and remanded the *Advanced Services
    First Report and Order* to the extent it required that an incumbent
    LEC permit physical collocation of equipment that is not "directly
    related to and thus necessary, required, or indispensable to
    'interconnection or access to unbundled network elements.'"[^40] The
    court made clear, however, that the Commission could construe
    "necessary" differently on remand as long as the Commission's
    construction stayed "within the limits of 'the ordinary and fair
    meaning" of section 251(c)(6).[^41]

### Meaning of "Necessary"

18. To determine the meaning of "necessary" as used in section
    251(c)(6), we look first to the text of the statute. Section
    251(c)(6) requires incumbent LECs to provide for "collocation of
    equipment necessary for interconnection or access to unbundled
    network elements at the premises of the local exchange carrier . . .
    ."[^42] We agree with the D.C. Circuit and many of the commenters
    that "any search for \[the\] 'plain meaning'" of "necessary" as used
    in this provision "is fruitless."[^43] As the D.C. Circuit's opinion
    implicitly recognizes, "necessary" has varying degrees.[^44] Neither
    the statutory language nor the legislative history reveals the
    degree of necessity that Congress intended to require in enacting
    section 251(c)(6).[^45] We therefore look to the broader statutory
    scheme and the underlying policy goals to determine the meaning of
    "necessary" as used in section 251(c)(6).[^46] As the court
    directed, however, any meaning we ascribe to that term must be
    "consistent with the ordinary and fair meaning of the word, *i.e.*,
    so as to limit 'necessary' to that which is required to achieve a
    desired goal."[^47]

19. Section 251 establishes a list of requirements that apply to various
    types of telecommunications carriers. Section 251(c) sets out those
    that apply to incumbent LECs. Sections 251(c)(2) and 251(c)(3), in
    particular, impose interconnection and unbundled network element
    obligations on incumbent LECs. In addition, section 251(d)(2)(A) of
    the Act requires that, in determining which network elements should
    be unbundled under section 251(c)(3), the Commission must consider
    whether "access to such network elements as are proprietary in
    nature is *necessary*."[^48] Because sections 251(c)(6) and
    251(d)(2)(A) both use the same term, "necessary," in reference to
    the same concept, "access to \[unbundled\] network elements," we
    believe it reasonable to interpret "necessary" in the two provisions
    similarly.

20. The similarity of purpose behind sections 251(c)(6) and 251(d)(2)(A)
    supports this view of "necessary." These provisions grant
    competitors certain interconnection, unbundled access, and
    collocation rights in order to promote the public interests in
    competition and technological innovation. But as the Supreme Court
    determined with regard to unbundled network elements and the D.C.
    Circuit determined with regard to collocation, those rights are not
    unlimited.[^49] Instead, we believe it reasonable to conclude that
    Congress used the term "necessary" in both provisions to balance two
    important, but potentially competing purposes. On the one hand, both
    provisions seek to promote competition and innovation through the
    grant of collocation rights and the right to access unbundled
    network elements. On the other hand, both provisions seek to protect
    an incumbent LEC's legitimate property interests against
    *unwarranted* intrusion: in the case of section 251(d)(2)(A), the
    property is intellectual property; in the case of section 251(c)(6),
    it is real property.

21. Because of the similarities in statutory language and purpose, we
    believe it is reasonable to conclude that "necessary" in sections
    251(c)(6) and 251(d)(2)(A) balances public and private interests in
    much the same manner. We therefore also conclude that our standard
    for determining which equipment is "necessary" within the meaning of
    section 251(c)(6) should be similar to our standard for determining
    which proprietary network elements are "necessary" within the
    meaning of section 251(d)(2)(A).[^50] In the *UNE Remand Order*, we
    concluded that a proprietary network element is "necessary" within
    the meaning of section 251(d)(2)(A) if "lack of access to that
    element would, as a practical, economic, and operational matter,
    *preclude* a requesting carrier from providing the services it seeks
    to offer."[^51] Similarly, as we explain in more detail below, we
    now conclude that equipment is "necessary" for interconnection or
    access to unbundled network elements within the meaning of section
    251(c)(6) if an inability to deploy that equipment would, as a
    practical, economic, or operational matter, preclude the requesting
    carrier from obtaining interconnection or access to unbundled
    network elements.[^52] As we also explain below, we conclude, in
    addition, that the scope of these collocation obligations are
    co-extensive with the interconnection and unbundled access
    obligations contained in sections 251(c)(2) and 251(c)(3).[^53]

22. In applying this equipment standard where multiple equipment options
    exist to provide interconnection or access to an unbundled network
    element, the parties must take into account the relative burdens
    that deployment of the different options would place on the
    incumbent LEC's property interests. Specifically, the record
    indicates that most telecommunications equipment will be available
    from multiple manufacturers, often in many different models.[^54]
    Where the different options of "necessary" equipment impose roughly
    comparable demands on the incumbent's space and other resources, our
    standard allows the requesting carrier to choose which particular
    option to deploy.

23. In some circumstances, however, implementing a particular equipment
    option might increase the overall demand on the incumbent's
    resources so significantly as to require the requesting carrier to
    choose a different option. For instance, extremely large equipment
    might require that the incumbent provide the requesting carrier with
    more total physical collocation space than would be required if
    other equipment were deployed. Similarly, extremely heavy equipment
    might require that the incumbent provide floor support beyond that
    typically available in the incumbent's premises. An incumbent also
    might have to upgrade otherwise sufficient power, air conditioning,
    heating, or similar plant in order to accommodate equipment that
    places unusually great demands on that infrastructure. We believe
    that a requesting carrier should not be considered practically,
    economically, or operationally precluded by an inability to deploy a
    particular piece of equipment, if deployment of that particular
    equipment would burden an incumbent's property interests, *and*
    alternative equipment not imposing such a burden were practically,
    economically, and operationally available to obtain interconnection
    or access to unbundled network elements, as described above.

24. We reject any suggestion that we must or should adopt a definition
    of "necessary" significantly different from that adopted with
    respect to section 251(d)(2)(A). We find that most of the
    alternative approaches proposed in the record either provide little
    additional guidance beyond the actual statutory language or do not
    provide an adequate limiting principle, as required by the D.C.
    Circuit's remand. For example, some of the suggested definitions
    fall outside the ordinary and fair meaning of "necessary" and
    therefore are inconsistent with the statute and the court's
    remand.[^55] Other proposed definitions substitute equally vague
    synonyms for an already ambiguous statutory term.[^56] Finally, some
    proposed definitions classify equipment as "necessary" on bases that
    appear unrelated to the statutory standard. For instance, certain
    competitive LECs appear to be equating the term "necessary" with any
    equipment that an incumbent deploys in its premises, regardless of
    its function.[^57] We find these proposals inconsistent with both
    the language and purposes of section 251(c)(6).[^58]

25. We also reject the argument, advanced by some incumbent LECs and
    competitive LECs, that we should interpret "necessary" as modifying
    "physical collocation," rather than "equipment" in section
    251(c)(6).[^59] Such a reading would wrongly place our focus on
    whether "collocation" of the equipment is necessary for
    interconnection and access to unbundled network elements as opposed
    to whether the equipment itself, regardless of its location in the
    network, is necessary for interconnection and access to unbundled
    network elements.[^60] Section 251(c)(6), instead, provides "for
    *physical collocation of equipment necessary* for interconnection or
    access to unbundled network elements at the premises of the local
    exchange carrier . . . ."[^61] We find that the most natural reading
    of this statutory language is that "necessary" modifies "equipment."
    Under this reading, we find that simple grammar dictates that the
    term "necessary" modifies "equipment" not "physical collocation,"
    which appears earlier in the statutory text.

26. We find, moreover, that this natural reading is consistent with the
    overall structure of section 251(c)(6). In addition to requiring
    physical collocation, section 251(c)(6) states that an incumbent LEC
    "may provide for virtual collocation if . . . physical collocation
    is not practical for technical reasons or because of space
    limitations."[^62] Interpreting section 251(c)(6) as providing for
    the collocation of "necessary" equipment accords virtual collocation
    a logical role in the statutory scheme.[^63] Specifically, under
    this interpretation, the incumbent LEC would have to allow
    collocation of any "necessary" equipment. This collocation normally
    would be physical; but where physical collocation is impractical,
    the incumbent could provide for virtual collocation.[^64] In
    contrast, determining that "necessary" modifies "physical
    collocation" would result in a seemingly self-contradictory statute.
    Under that interpretation, section 251(c)(6) would provide for
    "physical collocation" whenever the "necessary" test is met, giving
    the option for virtual collocation no independent meaning.[^65]

### Relationship with Sections 251(c)(2) and 251(c)(3)

27. Having defined the term "necessary," we also must determine the
    scope of activities for which competitors are entitled to collocate.
    The specific statutory purpose for which an incumbent LEC's
    competitors may collocate "necessary" equipment is for
    "interconnection or access to unbundled network elements."[^66]
    Several parties argue that "interconnection" as used in section
    251(c)(6) refers to "interconnection" as used in section 251(c)(2)
    and "access to unbundled network as used in section 251(c)(6) refers
    to "access to network elements on an unbundled basis" as used in
    section 251(c)(3).[^67] We agree with these arguments. Because
    section 251(c), by its terms, applies only to incumbent LECs and
    because section 251(c)(6) references the same obligations -- using
    virtually identical language -- detailed in sections 251(c)(2) and
    251(c)(3), we conclude that the most reasonable interpretation of
    the collocation obligations in section 251(c)(6) is that they are
    coextensive with the requirements of sections 251(c)(2) and
    251(c)(3).[^68] Accordingly, we find that section 251(c)(6)
    encompasses the scope of the interconnection and network access
    obligations imposed in sections 251(c)(2) and 251(c)(3).[^69]

28. The Communications Act and the Commission's prior orders define the
    scope of the interconnection and network access obligations imposed
    in sections 251(c)(2) and 251(c)(3). Section 251(c)(2) requires each
    incumbent LEC "to provide, for the facilities and equipment of any
    requesting telecommunications carrier, interconnection with the
    \[incumbent LEC's\] network . . . for the transmission and routing
    of telephone exchange service and exchange access . . . at any
    technically feasible point within the \[incumbent's\] network."[^70]
    This interconnection must be "at least equal in quality to that
    provided by the \[incumbent\] to itself or to any subsidiary,
    affiliate, or any other party to which the \[incumbent\] provides
    interconnection; and . . . on rates, terms, and conditions that are
    just, reasonable, and nondiscriminatory . . . ."[^71] Section
    251(c)(3) requires each incumbent LEC "to provide to any requesting
    telecommunications carrier for the provision of a telecommunications
    service, nondiscriminatory access to network elements on an
    unbundled basis at any technically feasible point on rates, terms,
    and conditions that are just, reasonable, and nondiscriminatory . .
    . ."[^72] The Commission has required that an incumbent LEC must
    provide requesting carriers with nondiscriminatory access to all the
    features, functions, and capabilities of an unbundled network
    element.[^73]

29. Whether equipment is "necessary for interconnection" within the
    meaning of section 251(c)(6) logically depends on the equipment's
    effect on the requesting carrier's ability to obtain interconnection
    "equal" to that which the incumbent provides itself or others within
    the meaning of section 251(c)(2).[^74] Similarly, whether equipment
    is "necessary for . . . access to unbundled network elements" within
    the meaning of section 251(c)(6) logically depends on the
    equipment's effect on the requesting carrier's ability to obtain
    "nondiscriminatory access" to unbundled network elements within the
    meaning of section 251(c)(3).[^75] Otherwise, collocated equipment
    would provide interconnection and access different from (*i.e.*,
    either inferior or superior to) the quality provided for in sections
    251(c)(2) and 251(c)(3).[^76] We therefore conclude that section
    251(c)(6) allows a requesting carrier to collocate any equipment
    necessary for obtaining equal interconnection or nondiscriminatory
    access to unbundled network elements as contemplated in sections
    251(c)(2) and 251(c)(3).

30. In the *Local Competition Order*, the Commission concluded that the
    "equal in quality" standard in section 251(c)(2) requires that an
    incumbent LEC design interconnection facilities to meet the same
    technical criteria and service standards, including transmission
    standards, that are used within the incumbent's own network.[^77]
    Accordingly, applying the statutory standard set forth in section
    251(c)(2), we conclude that section 251(c)(6) allows the
    interconnecting carrier to collocate any equipment necessary for
    interconnecting with the incumbent LEC at a level equal in quality
    to that which the incumbent obtains within its own network or the
    incumbent provides to any affiliate, subsidiary, or other
    party.[^78]

31. Similarly, as the Supreme Court held in *AT&T v. Iowa Util. Bd*., a
    "network element" need not "be part of the physical facilities or
    equipment that an incumbent uses to provide local phone
    service."[^79] Rather, that statutory term includes, in addition to
    such facilities or equipment, the "features, functions, and
    capabilities" provided by such facilities or equipment.[^80]
    Therefore, in order to obtain "nondiscriminatory access" to an
    unbundled network element within the meaning of section 251(c)(3), a
    carrier must be able to obtain more than mere access to the physical
    facilities and equipment included within the element.[^81] The
    carrier must instead be able to access all of the features,
    functions, and capabilities provided by means of the facilities and
    equipment.[^82] We therefore reject SBC's position that requiring
    access to an element's features, functions, and capabilities expands
    the meaning of "access" beyond statutory limits.[^83] Instead, such
    a requirement properly recognizes that the statutory definition of
    "network element," as interpreted by the Supreme Court, includes, in
    addition to "a facility or equipment used in the provision of a
    telecommunications service," the "features, functions, and
    capabilities" provided by such facility or equipment.[^84] Because
    the incumbent is able to access these features, functions, and
    capabilities, the nondiscrimination requirement in section 251(c)(3)
    mandates that the requesting carrier also be able to achieve similar
    access. Therefore, applying the statutory standard set forth in
    section 251(c)(3), we further conclude that section 251(c)(6) allows
    a requesting carrier to collocate any equipment necessary for
    obtaining "nondiscriminatory access" to an unbundled network
    element, including any of its features, functions, or
    capabilities.[^85]

### Multi-functional Equipment

32. Our standard for determining whether equipment is necessary requires
    that, absent deployment of the equipment, the requesting carrier
    would, as a practical, economic, or operational matter, be precluded
    from obtaining "equal in quality" interconnection or
    "nondiscriminatory access" to unbundled network elements from an
    incumbent LEC. Because the D.C. Circuit was particularly troubled by
    the Commission's previous analysis of multi-functional equipment, we
    find it appropriate to elaborate on how this standard applies to
    this equipment, which we define as equipment that combines functions
    that meet our equipment standard with functions that would not meet
    that standard as stand-alone functions.[^86] As the D.C. Circuit
    recognized, requiring that an incumbent LEC allow collocation of all
    multi-functional equipment regardless of the "unnecessary" functions
    that the equipment may be able to perform might unnecessarily take
    incumbent LEC property.[^87] On the other hand, precluding
    collocation of equipment that provides even a single "unnecessary"
    function regardless of the "necessary" functions the equipment would
    perform, as a practical, economic, or operational matter, might
    relegate collocators to outmoded and inadequate technology in
    contravention of the procompetitive and innovation-enhancing
    statutory purposes.[^88]

33. The incumbent LECs deploy multi-functional equipment throughout
    their networks and thus are able to realize the productivity
    increases that developments in micro-processing, optical
    transmission, and other technologies offer.[^89] We agree with
    several parties that the incumbent's competitors also must be able
    to realize these same benefits in order to further Congress' vision
    of a fully competitive telecommunications marketplace.[^90] In
    addition, we conclude that allowing the collocation of
    multi-functional equipment is critical to the realization of
    Congress' goal of promoting competition and technological
    innovation. Specifically, multi-functional equipment is designed to
    enable telecommunications carriers, both incumbents and their
    competitors, to offer their customers an ever-increasing array of
    telecommunications services, including advanced services, with
    ever-increasing efficiency.[^91]

34. We find that in certain circumstances collocation of
    multi-functional equipment is consistent with the statutory language
    and purposes. In doing so, we agree with Qwest and other commenters
    that one of the D.C. Circuit's principal concerns with respect to
    the Commission's prior equipment rule was its failure to establish
    any standard limiting the functions that a competitor could include
    in collocated multi-functional equipment.[^92] The court, however,
    did not foreclose a rule allowing collocation of at least some
    multi-functional equipment, provided the rule is consistent with the
    statutory language and purposes.[^93]

35. On remand, we adopt an approach for multi-functional equipment
    similar to that suggested by Qwest and generally supported by
    several other commenters.[^94] In this regard, we believe it is
    important to point out that Qwest is both an incumbent LEC and a
    competitive LEC. As Qwest itself emphasizes, it is thus:

    \[B\]oth a major purchaser and provider of collocation. Accordingly,
    Qwest is in the unique position of having to balance the need and
    desire of a \[competitive LEC\] for collocation space for its own
    uses with the totally lawful desire of an incumbent LEC to make use
    of its own private property for its own uses.[^95]

    Because we believe these to be factors about which the court
    expressed concern, we find Qwest's comments particularly persuasive.

36. We conclude that the best way to address the court's concerns
    regarding multi-functional equipment is to require an incumbent LEC
    to allow collocation of that equipment, if the primary purpose and
    function of the equipment, as the requesting carrier seeks to deploy
    it, are to provide the requesting carrier with "equal in quality"
    interconnection or "nondiscriminatory access" to one or more
    unbundled network elements.[^96] This condition is a direct
    application of the standard we adopt above for determining whether
    equipment is necessary within the meaning of section 251(c)(6). This
    condition recognizes the critical relationship between the equipment
    sought to be collocated and the specific interconnection or
    unbundled network elements the requesting carrier seeks from the
    incumbent LEC.[^97] It will ensure that a requesting carrier will
    not include a "necessary" function in equipment solely as a pretext
    for assuring its collocation.

37. In applying this condition, the parties must consider the extent to
    which the particular equipment, as the requesting carrier seeks to
    deploy it, would perform functions that are practically,
    economically, or operationally necessary for that carrier to obtain
    "equal in quality" interconnection or "nondiscriminatory access" to
    one or more unbundled network elements, as opposed to functions that
    would not meet our equipment standard as stand-alone functions. In
    this regard, we agree with Qwest that the requesting carrier must be
    intending to utilize the equipment primarily to obtain "equal in
    quality" interconnection or "nondiscriminatory access" to one or
    more unbundled network elements.[^98] We also find that, for
    purposes of determining whether a piece of equipment is to be
    utilized primarily to obtain \"equal in quality\" interconnection or
    \"nondiscriminatory access" to one or more unbundled network
    elements, there must be a logical nexus between the additional
    functions the equipment would perform and the telecommunication
    services the requesting carrier seeks to provide to its customers by
    means of the interconnection or unbundled network element.[^99] For
    instance, if a requesting carrier seeks to provide customers with
    telephone exchange service and exchange access, the additional
    functions should aid in the transmission or routing of those
    services.[^100]

38. We believe that limiting the functions that a requesting carrier may
    utilize in collocated multi-functional equipment in this manner
    reasonably balances the competing interests. As an initial matter,
    this approach properly recognizes that an incumbent LEC need not
    allow deployment of multi-functional equipment to the extent the
    requesting carrier intends to use it to perform functions, like
    payroll processing or certain types of data collection, that are
    unrelated to the requesting carrier's ability to obtain "equal in
    quality" interconnection or "nondiscriminatory" access to unbundled
    network elements.[^101] But beyond that, this approach also
    recognizes that, given the statutory requirement that an incumbent
    LEC provide for collocation of necessary "equipment," rather than
    "necessary "functions," application of our equipment standard to
    particular multi-functional equipment should focus on whether that
    equipment meets our equipment standard on an overall, as opposed to
    a function-by-function, basis.

39. In the context of multi-functional equipment and in light of the
    concerns expressed by the court, we believe that further refinement
    of our equipment standard is needed to ensure that the additional
    functions do not unnecessarily burden incumbent LEC property
    interests. Specifically, we find that the parties must consider
    whether the additional functions increase the overall demand on the
    incumbent's space and other resources above the levels that would
    prevail if the functions were excluded from the equipment or not
    activated. If the increase in demand due to the inclusion of
    additional functions is significant, the equipment would fail to
    meet the "necessary" standard.[^102] For example, a difference in
    the demand on an incumbent's space would be unacceptable if the
    incumbent had to reconfigure the outer boundaries of a carrier's
    physical collocation space in order to accommodate the additional
    functions. Similarly, a difference in demand on an incumbent's other
    resources would be unacceptable if the additional functions were to
    require that the incumbent provide floor support beyond that
    typically available in the incumbent's premises in order to
    accommodate extremely heavy equipment or that the incumbent upgrade
    otherwise sufficient power, air conditioning, heating, or similar
    plant in order to accommodate equipment that places unusually great
    demand on that infrastructure.[^103]

40. We find it reasonable to conclude that an incumbent's property
    interests (as opposed to its competitive interests) are not
    implicated by the inclusion of additional functions in collocated
    equipment or the requesting carrier's activation of those functions
    unless those actions affect the demand on the incumbent's space and
    other resources so significantly as to increase the relative burden
    on the incumbent's property interests.[^104] We recognize that much,
    and perhaps most, of the multi-functional equipment that requesting
    carriers may wish to collocate is smaller (and therefore requires
    less space), requires less power, and generates less heat than any
    available single-function equipment.[^105] Collocation of this
    multi-functional equipment therefore likely would not entail any
    appreciably greater imposition on the incumbent's space and
    supporting infrastructure than single-function equipment would
    entail. In addition, the record indicates that multi-functional
    equipment is rapidly replacing, if not making obsolete,
    single-function equipment.[^106] To the extent single-function
    equipment is available, it is unlikely to place significantly lesser
    demand on the incumbent's space and supporting infrastructure than
    multi-functional equipment that meets our standard.[^107] We
    therefore find that collocation of multi-functional equipment in the
    circumstances described above is consistent with the statutory
    language and purposes.

41. In finding that in certain circumstances collocation of
    multi-functional equipment is consistent with the statutory language
    and purposes, we reject, on the one hand, positions that would
    result in a blanket prohibition of multi-functional equipment and,
    on the other hand, proposals that would result in the adoption of a
    standard without real limiting principles. Specifically, we reject
    BellSouth's, SBC's, and Verizon's argument that an incumbent LEC
    must be allowed to preclude collocation of any equipment that
    includes one or more functionalities whose deployment is
    "unnecessary" for interconnection or access to unbundled network
    elements.[^108] We find this approach to be unreasonably narrow and
    disconnected from the statutory purposes.[^109] As an initial
    matter, we are not persuaded by BellSouth's, SBC's, and Verizon's
    argument that the statute compels this approach. On the contrary,
    this approach would require that section 251(c)(6) limit requesting
    carriers to collocation of "*functionalities* necessary for
    interconnection or access to unbundled network elements."[^110] We
    find no basis in the statutory language, broader statutory scheme,
    or the legislative history for interpreting the statute in this way.
    Rather, we find it telling that, in the 1996 Act, Congress carefully
    distinguished between equipment and its functions when it wanted to
    do so.[^111] Thus, we do not find that section 251(c)(6) compels
    that an incumbent must be able to exclude from collocation any
    equipment that contains a single functionality that, if offered on a
    stand-alone basis, would be deemed "unnecessary" for interconnection
    or access to unbundled network elements.

42. As discussed above,[^112] section 251(c)(6) reflects the
    congressional desire to promote competition and technological
    innovation, while recognizing the incumbent's interest in using and
    managing its property. BellSouth's, SBC's, and Verizon's approach
    toward multi-functional equipment fails to balance these
    congressional goals, instead focusing solely on the impact
    multi-functional equipment may have on their property
    interests.[^113] We believe that our approach reasonably balances
    these interests because it imposes limits on a requesting carrier's
    ability to collocate and deploy multi-functional equipment that
    protect the incumbent's property against burdensome intrusions,
    while permitting requesting carriers a degree of freedom to choose
    the equipment that best fits their technical and competitive
    needs.[^114]

43. At the other extreme, the proposals of some competitive LECs that
    would give requesting carriers virtually unrestricted rights
    regarding multi-functional equipment would allow, at least
    conceptually, the collocation and activation of a vast array of
    multi-functional equipment without regard to the effect such actions
    would have on the incumbents' ability to use and manage their own
    property.[^115] While collocation of this equipment might marginally
    increase a requesting carrier's ability to compete, such an increase
    simply does not make any particular piece of equipment "necessary
    for interconnection or access to unbundled network elements" within
    the meaning of section 251(c)(6).[^116] We find that a more balanced
    approach, as described above, more appropriately advances the
    congressional goal of promoting competition and technological
    innovation without unnecessarily infringing on an incumbent's
    property interests.

### Other Equipment

44. A number of commenters, including ATG and Sprint, ask that we
    determine that certain types of equipment are "necessary for
    interconnection or access to unbundled network elements" within the
    meaning of section 251(c)(6).[^117] This equipment includes optical
    terminating equipment, fiber distribution frames, ATM multiplexers,
    concentration devices, DSLAMs, and microwave transmission
    facilities,[^118] as well as splitters,[^119] equipment to light
    dark fiber,[^120] and ancillary equipment that enables a requesting
    carrier to assure proper provisioning and functioning of other
    collocated equipment.[^121] For the most part, there is little, if
    any, controversy regarding the equipment these commenters seek to
    collocate.[^122] Because we anticipate that incumbents will allow
    collocation of the non-controversial equipment without further
    regulatory intervention, we find no need to address whether much of
    the equipment these commenters seek to collocate meets the equipment
    standard we adopt in this Order.[^123] We also are concerned that
    any list of "necessary" equipment we might develop would quickly
    become obsolete as manufacturers develop, and carriers deploy in new
    ways, the ever-increasing array of equipment that technological
    advances have made possible. A decision on our part that a
    particular type of equipment is "unnecessary," given today's network
    architectures, might impede the development of new architectures
    that expand the services carriers are able to provide their
    customers.[^124]

45. The main controversy on this record with regard to single-function
    equipment concerns equipment having switching or routing
    capability.[^125] Competitive LECs maintain that they must perform
    switching and routing functions to access unbundled local loops, and
    therefore must be able to collocate switching or routing equipment.
    As explained below, we now agree with competitive LECs that
    switching or routing capability is necessary to access all the
    features, functions, and capabilities of unbundled local loops.
    Specifically, as discussed below, we find that, in certain
    instances, switching and routing equipment meets our equipment
    standard and is thus "necessary" equipment entitled to collocation
    pursuant to section 251(c)(6).[^126]

46. Under section 251(c)(3), requesting carriers are entitled to access
    all the features, functions and capabilities of unbundled network
    elements. The Commission has previously held that this means that
    competitors are entitled to more than mere physical access to
    unbundled local loops.[^127] Switching and routing equipment allows
    a competitor to access the features, functions, and capabilities
    that accommodate the transmission of voice and data traffic over
    that loop, between the end user and the specified destination.[^128]
    For purposes of section 251(c)(3), we believe that a switch or
    router provides a requesting carrier with access to the local loop
    in a manner functionally equivalent to a DSLAM, the equipment
    incumbents and their competitors deploy to access the local loop's
    capability of providing xDSL services and which most commenters,
    including several incumbent LECS, concede satisfies the "necessary"
    standard.[^129] Without equipment such as a DSLAM, switch, or
    router, the local loop is merely a transmission medium theoretically
    capable of carrying telecommunications traffic. To access an
    unbundled local loop's theoretical capability of providing a
    telecommunications service, *i.e.*, of accommodating the
    transmission of information "between or among points specified by
    the user,"[^130] a requesting carrier must, as a practical,
    economic, and operational matter, be able to switch or route traffic
    to or from that loop. Therefore, switching and routing equipment is
    necessary for accessing all the features, functions, and
    capabilities of an unbundled local loop that facilitate the
    transmission of telecommunications traffic.[^131]

47. As explained above,[^132] however, an inability to deploy a
    particular piece of switching or routing equipment may not preclude
    a requesting carrier from obtaining interconnection or obtaining
    access to unbundled network elements, if deployment of that
    particular equipment would burden an incumbent's property interests
    *and* alternative equipment not imposing such a burden were
    practically, economically, and operationally available to obtain
    interconnection or access to unbundled network elements consistent
    with sections 251(c)(2) and 251(c)(3). We find this statement
    particularly applicable to switching and routing equipment because
    certain types of switches and routers are dramatically smaller than
    others, and thus impose significantly lesser burdens on an
    incumbent's property interests if collocated. Specifically,
    technological advances have enabled manufacturers to develop
    relatively small makes and models of switches and routers that
    resemble and generally are roughly the same size as consumer
    electronics equipment, such as stereos.[^133] We conclude that as a
    practical, economic, and operational matter, this innovative
    equipment is available to a requesting carrier to access those
    features, functions, and capabilities of unbundled local loops for
    which switching or routing is needed.

48. Although application of our equipment standard would allow these
    smaller types of switches and routers to be collocated, it will not
    generally allow collocation of the circuit switches traditionally
    used to provide telecommunications services. These circuit switches
    are very large pieces of equipment.[^134] For instance, the circuit
    switches typically available in 1996 for deployment in incumbent
    LECs' central offices are approximately 100 times the size of the
    more modern switches and routers that equipment manufacturers have
    been able to develop. The traditional circuit switches require a
    separate room; several of the more modern switches and routers can
    fit comfortably within a typical 10-foot by 10-foot collocation
    cage.[^135] We agree with SBC and Verizon that traditional circuit
    switching equipment is generally not \"necessary\" within the
    meaning of section 251(c)(6) because a requesting carrier would not
    be practically, economically, or operationally precluded from
    interconnecting or accessing unbundled network elements pursuant to
    sections 251(c)(2) and 251(c)(3) if it could not deploy this
    traditional circuit switching equipment.[^136] Specifically, in
    light of the practical, economic, and operational availability of
    newer and much smaller switches and routers as well as the lesser
    burden collocation of that equipment imposes on an incumbent's
    property interest, we find that traditional circuit switches
    generally do not meet the equipment standard we adopt today.[^137]

49. We emphasize that this finding does not mean that an incumbent LEC's
    competitors are entitled to collocate any equipment that utilizes
    the features, functions, and capabilities of the local loop. Section
    251(c)(3) provides only telecommunications carriers with the ability
    to access unbundled network elements. Therefore, parties seeking to
    use the local loop, for example, only to deliver information
    services do not have rights under section 251(c)(3) to access that
    unbundled network element. Since section 251(c)(6) incorporates the
    obligations and limitations contained in sections 251(c)(2) and
    251(c)(3), an incumbent LEC need not allow these parties to
    collocate such equipment.

50. We recognize that this conclusion differs from the Commission's
    prior holding that stand-alone switches or routers are not entitled
    to collocation pursuant to section 251(c)(6) in any instance.[^138]
    We find here, however, that the Commission's prior analyses of the
    statutory standard were incomplete because they did not fully
    address the different purposes for which requesting carriers might
    deploy "necessary" equipment. For instance, in the *Local
    Competition Order*, the Commission, in finding switching equipment
    unnecessary, stated that "it \[did\] not appear that \[this
    equipment\] is used for the actual interconnection or access to
    unbundled network elements."[^139] Subsequently, in the *Advanced
    Services First Report and Order*, the Commission declined to
    classify equipment used exclusively for switching as "necessary,"
    because it did "not find sufficient support in the record at this
    time for such a requirement."[^140] In neither case did the
    Commission explain how a requesting carrier could access all the
    features, functions, and capabilities of a local loop without
    switching or routing equipment.[^141]

51. We now have the benefit of a greatly expanded record that reflects
    both the parties' several years of experience with the unbundled
    network access regime established in the 1996 Act as well as the
    technical expertise of many equipment manufacturers.[^142] This
    greatly expanded record has enabled us to refine our analysis within
    the framework the D.C. Circuit established and the equipment
    standard we adopt in accordance with that framework.[^143] Based on
    this record, we are now convinced that, as a practical, economic, or
    operational matter, a requesting carrier may require switching or
    routing equipment to be able to access all of the features,
    functions, or capabilities of unbundled local loops.

52. Although we find, in a reversal of the Commission's previous
    findings in the 1996 *Local Competition Order* and *Advanced
    Services First Report and Order*, that switching and routing
    equipment satisfy the "necessary" standard in certain instances, we
    emphasize that our equipment standard has clear limiting principles
    that operate to provide more definitive boundaries than the
    Commission's previous standard. The Commission's previous standard,
    as applied in the *Advanced Services First Report and Order*,
    provided requesting carriers with virtually limitless control over
    the types of equipment that they could collocate.

53. The equipment standard we adopt today places clear limits on the
    types of functions for which competitors may collocate equipment.
    Our standard does not allow competitors to collocate much of the
    equipment that they must rely on to operate, service, and support
    their own networks. Therefore, our standard would not result in an
    incumbent LEC's premises being used by a competitor to house all of
    the equipment necessary to operate, service, and support its own
    network. For example, our standard would not require that an
    incumbent LEC allow collocation of equipment used exclusively for
    call-related databases, computer servers used exclusively for
    providing information services, and a whole host of operations
    support system (OSS) equipment that most competitors must rely on to
    support their network operations. Nor would our standard let a
    requesting carrier insist on collocating equipment that generates
    customer orders, manages trouble tickets or inventory, or stores
    customer records in centralized databases.[^144] In addition, in the
    multifunction context, our standard places significant limits on the
    ability to collocate multifunction equipment by ensuring that the
    equipment's primary functionality is used for interconnection or
    accessing unbundled network elements while ensuring that
    multifunction equipment places no greater relative burden on the
    incumbent's property than comparable single-function equipment. The
    Commission's previous test did not place such clear limits on the
    types of equipment that are eligible for collocation. Finally,
    equipment that does not provide telecommunications services would
    not qualify for collocation under our standard.

54. We believe our standard reasonably reflects the balance required by
    section 251(c)(6)'s cross-purposes of promoting competition and
    innovation while ensuring adequate protection of the incumbent LECs'
    legitimate property interests. On one hand, our standard ensures
    that an incumbent LEC's telecommunications competitors cannot place
    equipment in collocation space with unfettered discretion, but
    rather must limit their collocation choices to equipment that is
    necessary for these carriers to achieve the enunciated statutory
    purposes of interconnection and access of unbundled network
    elements. On the other hand, it ensures that incumbent LECs cannot
    exercise *de* *facto* veto power over their collocated competitors'
    choice of equipment and network architecture, and instead grants
    competitors sufficient flexibility with which to make reasonable
    equipment choices that overcome practical, economic, and operational
    constraints in a manner that protects the incumbent's property
    interests.

## Cross-Connections Between Collocators

55. In the *Local Competition Order*, the Commission required incumbent
    LECs to provision (*i.e.*, install and maintain) cross-connects to
    allow a collocator to connect its collocated equipment to the
    collocated equipment of another carrier within the same incumbent
    LEC premises so long as each collocator's equipment was used for
    interconnection with the incumbent or access to the incumbent's
    unbundled network elements.[^145] In the *Advanced Services First
    Report and Order*, the Commission further required incumbent LECs to
    permit collocating carriers to provision their own cross‑connect
    facilities between equipment collocated at the incumbent's premises,
    subject only to the same reasonable safety requirements the
    incumbent places on its own facilities.[^146]

56. In *GTE v. FCC*, the D.C. Circuit vacated and remanded the
    cross-connects rule adopted in the *Advanced Services First Report
    and Order*.[^147] The court stated that "requiring \[incumbent\]
    LECs to allow collocating competitors to interconnect their
    equipment with other collocating carriers . . . imposes an
    obligation on \[incumbent\] LECs that has no apparent basis in the
    statute."[^148] The court found that the Commission had not shown
    that cross-connects between collocators are "necessary for
    interconnection or access to unbundled network elements" within the
    meaning of that provision.[^149]

57. In the *Second Further Notice*, the Commission invited comment on
    whether section 251(c)(6) encompasses cross-connects between
    collocators.[^150] The Commission also invited comment on whether it
    may, pursuant to section 251(c)(6), require that an incumbent LEC
    permit collocators to construct their own cross-connects as opposed
    to obtaining them from the incumbent.[^151] The Commission invited
    comment, in addition, on whether it may require an incumbent LEC to
    provide physical connections between two collocators pursuant to any
    other provision of the Communications Act.[^152]

58. As an initial matter, we believe it is important to define
    cross-connects and describe how prevalent they are in a typical
    central office. "A cross-connection \[or cross-connect\] is a
    cabling scheme between cabling runs, subsystems, and equipment using
    patch cords or jumper wires that attach to connection hardware on
    each end."[^153] Typically, in a central office, the cabling scheme
    might run from a piece of equipment up into an overhead racking
    system, through that system and down from the racks to connect with
    another piece of equipment. Cross-connects can run through the main
    distribution frame or an intermediate distribution frame when being
    used to connect two pieces of equipment or when being used to
    connect equipment to a transmission facility, such as a loop or
    trunk. When two pieces of equipment are in close proximity to each
    other, the cross-connect may progress directly from one piece of
    equipment to the other without entering the racking system.
    Cross-connects generally are present throughout the incumbent's
    premises. Cross-connects interconnect incumbent LEC equipment to
    other incumbent LEC equipment and incumbent LEC equipment to
    collocator equipment. Cross-connects also interconnect one piece of
    a collocator's equipment to another piece of that collocator's
    equipment. Finally, because of the Commission's previous
    cross-connect rule adopted in the *Local Competition Order*,
    cross-connects have been used to interconnect one collocator's
    equipment to another collocator's equipment.[^154]

59. At issue in this *Order* are the cables that cross-connect two
    collocated competitive LECs. As explained below, we find that, in
    light of *GTE v. FCC*, we may not require an incumbent LEC to allow
    competitive LECs to provision cross-connects outside of their
    immediate physical collocation space at the incumbent's premises.
    However, we find that pursuant to section 201 that it would be
    unjust and unreasonable for an incumbent LEC to refuse to provision
    cross-connects between two collocated competitive LECs. We also find
    that, in the alternative, such a refusal would be unjust,
    unreasonable, and discriminatory within the meaning of section
    251(c)(6). Accordingly, we return to the obligations set forth in
    the *Local Competition Order* that required incumbent LECs to
    provision cross-connects to collocators.

60. We find that there are significant differences between requiring the
    incumbent to provision the cross-connects for collocated competitive
    LECs and requiring an incumbent LEC to allow competitive LECs to
    provision cross-connects within the incumbent's premises. First,
    there is a fundamental difference as to who owns and controls the
    cross-connect cabling. When competitive LECs provision their own
    cross-connects, the competitive LECs own and control the cabling;
    whereas, when the incumbent provisions the cross-connects, the
    incumbent owns and controls the cabling. Second, for competitive
    LECs to provision cross-connects, they typically must access common
    areas, which may include a racking system, of the incumbent's
    premises to install and maintain the cross-connects.[^155] In
    contrast, if the incumbent provisions the cross-connects, the
    competitive LECs need not have access to the common areas for the
    purpose of provisioning the cross-connects. Thus, the latter
    approach is substantially less invasive of the incumbent's property
    rights (*e.g*., in terms of security, safety, and risk to incumbent
    LEC equipment).[^156]

### Competitive LEC Self-Provisioning of Cross-Connects

61. We find that neither section 201 nor section 251 authorizes us to
    adopt a rule requiring physical collocation by which incumbent LECs
    allow competitive LECs to provision cross-connects outside of their
    immediate collocation space. Specifically, we conclude, in
    accordance with the D.C. Circuit's decision, that competitive LEC
    provisioning of cross-connects between two separate collocation
    arrangements constitutes physical collocation because the
    competitive LEC-owned cable would typically occupy space in the
    incumbent's premises outside of the collocator's immediate
    collocation space and because the collocator would have to access
    areas of the incumbent's premises outside that immediate collocation
    space in order to install and maintain the cabling.[^157] Thus, such
    a requirement would have to satisfy the "necessary" prong of section
    251(c)(6).[^158] In addition, as SBC points out, the D.C. Circuit
    has determined that the Commission's authority under section 201(a)
    does not extend to requiring a carrier to allow physical collocation
    within its premises.[^159] Because we also find that the
    competitive-LEC provisioning of cross-connects constitutes physical
    collocation, we must conclude that our authority under section 201
    does not extend to requiring that an incumbent LEC allow such
    provisioning.

### Incumbent LEC Provisioning of Cross-Connects -- Section 201

62. We agree with Sprint, Qwest, Focal, and the Joint Commenters that we
    may order incumbent LECs to provide cross-connects to collocators
    pursuant to section 201.[^160] We find that we have such authority
    under both sections 201(a) and 201(b). We conclude that the
    Commission has authority pursuant to section 201 to require
    incumbent LECs to provision cross-connects for carriers collocated
    at the incumbent's premises, and we exercise this authority to
    require such cross-connects upon reasonable request. Unlike the
    situation with competitive LEC-owned and provisioned cross-connects,
    we conclude that an incumbent LEC's provisioning of cross-connects
    between two separate collocation arrangements does not constitute
    physical collocation. In the instance of incumbent-provisioned
    cross-connects, because the competitive LEC does not own or
    provision the cross-connects, there is no collocator-owned equipment
    being placed or collocator activity occurring outside of the
    immediate collocation space. In other words, the cabling being used
    to facilitate the cross-connect is owned, controlled, and
    provisioned by the incumbent LEC.

63. We find that the Commission has authority under section 201(a) of
    the Act to require incumbent LECs to provision cross-connects
    between two collocated carriers. [^161] Section 201(a) requires
    "every common carrier engaged in interstate or foreign communication
    by wire or radio to furnish such communication service upon
    reasonable request therefor."[^162] As explained below, under the
    circumstances presented here, we find that incumbent LEC-provisioned
    cross-connects between collocators within the incumbent's premises
    constitute a "communications service" "necessary or desirable in the
    public interest" within the meaning of section 201(a).[^163] We find
    that the provisioning of cross-connects between collocated
    competitive LECs merely puts each collocator in a position to
    achieve the same interconnection with other collocators that the
    incumbent itself is able to achieve.[^164] Because most
    facilities-based competitive LECs must collocate at incumbent LECs'
    premises, incumbents have the opportunity to efficiently
    interconnect with competitive LECs. If an incumbent LEC refuses to
    provision cross-connects between competitive LECs collocated at the
    incumbent's premises, the incumbent would be the only LEC that could
    interconnect with all or even any of the competitive LECs collocated
    at a common, centralized point -- the central office.[^165] In
    addition, if collocating competitive LECs cannot interconnect with
    each other at the incumbent's premises, they typically must use
    incumbent LEC transport facilities to obtain access to competitive
    transport facilities. The costs associated with purchasing incumbent
    LEC transport in addition to the costs associated with purchasing
    the competitive transport likely would severely restrict the
    viability of competitive transport.

64. The most direct and efficient way for two carriers collocated within
    the same incumbent LEC premises to exchange traffic is to
    cross-connect within that premises. For instance, for two
    competitive LECs collocated at the same central office to exchange
    traffic without a cross-connect, each competitive LEC would have to
    carry its own telecommunications traffic into its collocation space
    and then, in the typical case, have the incumbent LEC transport that
    traffic over incumbent-owned facilities to an interconnection point
    outside the incumbent's premises. From this interconnection point,
    the other competitive LEC would likely then carry the traffic back
    to its own collocation space in the same central office to be
    transported through the competitive LEC's network.[^166] This
    approach creates additional potential points of failure, may require
    otherwise unnecessary signal boosting, and, perhaps most importantly
    and most dramatically, imposes significant wasteful economic costs
    on competitive LECs -- costs that incumbent LECs themselves do not
    face and costs that the incumbents do not impose on competitive LECs
    that utilize the incumbent's transport services.[^167] These
    additional costs would severely impede the deployment of the
    innovative, competitive services that the 1996 Act seeks to
    facilitate.[^168]

65. We find that cross-connects between collocators within an
    incumbent's premises are essential to the development of a fully
    competitive transport market.[^169] Incumbents, of course, provide
    cross-connects within their premises to collocators that purchase
    the incumbents' transport services. However, a collocating
    competitive LEC that cannot deliver its traffic to another
    collocator via a cross-connect at the incumbent's premises would
    likely be forced either to use incumbent LEC transport services or
    to build its own transport facilities.[^170] Surely, such results
    would run directly counter to the fundamental purposes of the
    Communications Act. First, the Act attempts to lessen, not entrench,
    incumbent LEC control over local markets, including the local
    transport market. Second, the Act clearly recognizes that
    competitors are unlikely to find it economic to build entirely
    redundant facilities and therefore allows competitors to fill in
    those gaps in infrastructure through the wholesale market.[^171] To
    this end, cross-connects between collocated carriers allow
    competitive LECs to use the facilities of other competitive LECs
    rather than relying solely on the incumbent LEC to fill in the gaps
    in their network.[^172]

66. Without the ability to cross-connect at the incumbent's premises, a
    collocated competitive LEC that has its own transport facilities
    would be severely restricted in its ability to optimize the
    utilization of their transport facilities through the wholesale
    provision of transport services to other competitive LECs.[^173] In
    addition, a competitive LEC wishing to purchase transport from
    another competitive LEC with transport facilities would be in the
    untenable position of having to purchase additional transport from
    the incumbent out of the incumbent's premises in order to access and
    interconnect with the other competitive transport provider's
    facilities at some point outside of the incumbent's premises. Once
    interconnected, the carrier could utilize the competitive transport
    service. This added expense, however, almost assuredly would make
    the competitive transport cost-prohibitive and would be economically
    wasteful.[^174] The effect would be to entrench the incumbent LECs'
    power in the transport market in direct contradiction of the Act's
    fundamental purpose to "open\[\] all telecommunications markets to
    competition."[^175]

67. Importantly, we find that providing cross-connects between
    collocated carriers will not materially burden incumbent LECs. The
    provisioning of cross-connects in a central office is not an
    extraordinary occurrence. The central office and other incumbent LEC
    premises are, by design, places where a carrier can cross-connect
    equipment. Moreover, such provisioning is far less burdensome than
    requiring incumbents to allow competitive LECs to self-provision
    their own cross-connects. After balancing the interest of promoting
    competition with the property interest of the incumbent, we conclude
    that requiring incumbent LECs to provision cross-connects between
    two collocating carriers substantially furthers Congress' goal of
    promoting competition while minimizing, if not eliminating, any
    invasion on the incumbent's property interests. While cross-connects
    between collocators within incumbent LEC premises are critical to
    the development of facilities-based competition, a requirement that
    incumbents provide cross-connects to competitors collocated at their
    premises constitutes at most a minimal invasion of the incumbent's
    property rights, particularly since this service would only have to
    be provided between two already collocated competitive LECs. Because
    the incumbent would maintain control over the provisioning and
    maintenance, we find that this requirement imposes little, if any,
    additional burden on the incumbent's property interest. We believe
    that whatever burden this requirement does place on this interest,
    it is significantly outweighed by the requirement's pro-competitive
    effects.

68. We find that the Commission has authority to compel carriers to make
    a cross-connect service generally available to similarly situated
    customers, especially when it uses that authority in such a targeted
    and discrete fashion. Courts generally have affirmed the ability of
    administrative agencies to impose specific common carriage
    obligations on entities that are regulated as common carriers.[^176]
    We note that our action here is similar in many respects to the
    Commission's prior actions pursuant to section 201(a). In the
    *Specialized Common Carrier Proceeding*, for example, the Commission
    relied on section 201(a) in requiring the LECs then affiliated with
    AT&T to provide specialized common carriers with interconnection
    facilities and services that those carriers needed to provide
    private line services.[^177] This action was an important early step
    in opening the long-distance market to competition. Similarly, in
    the *Virtual Collocation Order*, the Commission relied on section
    201(a) in requiring incumbent LECs to provide virtual collocation
    within their central offices.[^178] This action was designed to
    promote competition in the transport market.

69. We view our instant action as comparable to those prior Commission
    actions. Indeed, requiring incumbent LECs to provision
    cross-connects between collocated carriers furthers Congress'
    decision in the 1996 Act to open all telecommunications markets to
    competition and is consistent with (though less intrusive than) the
    Act's requirement that incumbent LECs allow physical collocation
    within their premises under section 251(c)(6). Thus, our instant
    action promotes competition by permitting carriers that collocate
    for purposes of competing against the incumbent to select the
    transport provider of their own choosing, rather than being forced
    to rely solely on the incumbent LEC or their own facilities for
    provision of that service. At the same time, this competitive goal
    is achieved without requiring the incumbent LEC to permit
    competitive LECs to own, install, and maintain these cross-connects.

70. For these reasons, we find that that the provision of cross-connects
    by incumbent LECs to collocated competitive LECs is a common carrier
    service pursuant to section 201(a).[^179] As discussed above,
    without the ability to cross-connect at an incumbent's premises,
    competitive transport would likely be cost-prohibitive and
    economically wasteful. The effect would be to entrench the incumbent
    LECs' power in the transport market.[^180] These adverse effects on
    the public interest persuade us that we should exercise our
    authority under section 201 to require incumbent LECs to provision
    cross-connects as described above.[^181]

71. We reject SBC's argument that the Commission cannot rely on section
    201(a) to require incumbent LECs to provide cross-connects between
    collocated carriers.[^182] That argument is based on the D.C.
    Circuit's holding in *Bell Atlantic v. FCC* that section 201(a) does
    not authorize the Commission to provide for *physical* collocation
    within an incumbent LEC's central offices.[^183] That holding,
    however, does not preclude the Commission from mandating that an
    incumbent provide facilities and equipment dedicated to a particular
    carrier's use, as long as that carrier does not have access to the
    incumbent's property for the purpose of installing or maintaining
    the facilities or equipment.[^184] As the Commission recognized in
    the *Virtual Collocation Order*, incumbent LECs frequently dedicate
    facilities and equipment to particular customers in their normal
    course of business.[^185] Our requirement that incumbent LECs
    install and maintain cabling that permits a collocator to
    cross-connect with another telecommunications carrier within the
    incumbent's premises is not only consistent with that practice, but
    also necessary or desirable in the public interest.

72. In addition, section 201(b) supports Commission authority to require
    incumbent LECs to provision cross-connects between two collocated
    competitive LECs. Section 201(b) states that "\[a\]ll charges,
    practices, classifications and regulations for and in connection
    with such communication service, shall be just and reasonable, and
    any such charge, practice, classification or regulation that is
    unjust or unreasonable is hereby declared to be unlawful."[^186]
    Under section 201(b), we find an incumbent LEC's refusal to
    provision cross-connects to be an unjust and unreasonable practice
    in connection with existing services of incumbent LECs.

73. Ultimately, we agree with Qwest that cross-connects are not
    functionally different from other nonswitched services, such as
    special access services, that incumbent LECs provide to other
    carriers and end users.[^187] Like these other services, the
    cross-connect provides a dedicated transmission path between two
    points, in this case between collocated carriers. Therefore, our
    requirement to provide cross-connects between collocated competitive
    LECs is not burdensome; rather, it is a "practice" needed in
    connection with an incumbent LEC's existing special access services
    to render the provisioning just and reasonable under section
    201(b).[^188] Without this specific offering, an incumbent instead
    could require, as reasoned above, that the collocator purchase
    incumbent transport to carry the traffic out of the incumbent's
    premises to an interconnection point outside the incumbent's
    premises. From this interconnection point, the competitive transport
    provider likely would then carry the traffic back to the incumbent's
    premises for carriage through the competitive transport provider's
    transport network.

74. In making available a cross-connect offering, we find that, pursuant
    to its obligations to provide a communications service upon
    reasonable request, and to engage in just and reasonable practices,
    an incumbent LEC must provide the appropriate cross-connect as
    requested by the collocated competitive LECs. We note that the
    "appropriate" cross-connect facility may constitute a "lit" service
    or a dark fiber service depending upon the requirements of the two
    collocated competitors. Requiring carriers to purchase a "lit"
    service when they only require unlit fiber cabling would add
    significant expense and almost assuredly would make the competitive
    transport cost-prohibitive and uneconomical.

75. Our decision to include dark fiber as part of the cross-connect
    service that incumbents must provide to collocators upon request is
    limited in scope. Indeed, we are not requiring incumbent LECs to
    provide a general dark fiber service. Rather, only in the limited
    context of cross-connects between collocated carriers must incumbent
    LECs provide dark fiber service under this Order.[^189] Our decision
    to require this is due to the technical and competitive
    circumstances existing in the marketplace. We find that incumbent
    LEC provisioned cross-connects, including cross-connects in the form
    of lit or unlit fiber, are essential to allow the development of a
    competitive transport market in light of existing technological and
    economic factors.

76. We also note that in provisioning cross-connects, incumbent LECs
    should use the most efficient interconnection arrangements available
    that, at the same time, impose the least intrusion on their property
    interest. For example, in cases where incumbents interconnect with
    collocators at equipment that is closer to the collocators' space
    than the incumbent's main distribution frame, we would expect the
    cross-connect to be provisioned, where technically feasible, at or
    near that equipment, rather than at the main distribution frame.
    This provides competitive LECs with the most efficient
    interconnection arrangements while minimizing the amount of cable
    that has to be routed through the incumbent's central office. We
    recognize that incumbent LECs, however, are not required to provide
    competitors better interconnection or access to the network than
    already exists. This requirement merely allows the collocator to use
    the existing network in as efficient a manner as the incumbent uses
    it for its own purposes. Furthermore, we expect that incumbent LECs
    should be able to provision these cross-connects in a time frame no
    longer than that which the incumbent provides itself or any
    affiliate or subsidiary.[^190]

77. We recognize, of course, that the Commission's exercise of its
    authority under section 201 historically has been limited to
    interstate and foreign communication by wire or radio. Physical
    connections between collocators and other carriers, like other
    portions of the telecommunications network, typically transmit both
    interstate and intrastate traffic. We have previously determined
    that special access lines carrying both interstate and intrastate
    traffic are subject to the Commission's jurisdiction where it is not
    possible to separate the uses of the special access lines by
    jurisdiction.[^191] We have typically exercised that jurisdiction,
    however, only when the amount of interstate traffic transmitted over
    a special access line constitutes more than ten percent of all
    traffic transmitted over that line.[^192] We have reasoned that
    lesser percentages of interstate traffic should be considered *de
    minimis*.[^193]

78. We conclude that a similar approach is appropriate with regard to a
    cross-connect service between collocators and other carriers
    provided pursuant to section 201. As with special access traffic, we
    would expect that the traffic carried through these cross-connects
    typically includes interstate or foreign communication. To the
    extent that our cross-connect requirements are dependent upon our
    authority under section 201, we require incumbent LECs to provide a
    cross-connect within its premises where: (1) two collocated carriers
    request such a cross-connect; and (2) more than a *de minimis*
    amount of the traffic to be transmitted through the cross-connect
    will be interstate.[^194] Where the interstate or foreign traffic
    would be more than *de minimis*, the incumbent LEC must provision
    the cross-connect through its interconnection facilities or
    equipment. Where a collocator is requesting this cross-connect
    solely pursuant to our action under section 201, it shall provide a
    certification to the incumbent that it satisfies the *de minimis*
    threshold of ten percent. Upon receipt of such certification, the
    incumbent shall promptly provision the service. The incumbent cannot
    refuse to accept the certification but instead must provision the
    service promptly. If the incumbent feels that the certification is
    inaccurate, it can file a section 208 complaint with the
    Commission.[^195]

### Incumbent LEC Provisioning of Cross-Connects -- Section 251

79. Similar to our reasoning under section 201, we find, as a second,
    alternative ground, that incumbent LEC-provisioned cross-connects
    between two collocators, and the attendant obligations to make dark
    fiber available as a cross-connect and to use the most efficient
    arrangement available, are also supported by section 251 of the Act.
    Incumbent LEC-provisioned cross-connects are properly viewed as part
    of the terms and conditions of the requesting carrier's collocation
    in much the same way as the incumbent LEC provisions cables that
    provide electrical power to collocators. Once equipment is eligible
    for collocation, the incumbent LEC must install and maintain power
    cables, among other facilities and equipment, to enable the
    collocator to operate the collocated equipment. The power cables are
    not "collocated" merely because the incumbent LEC installs and
    maintains these cables in areas outside the requesting carrier's
    immediate collocation space. Instead, the incumbent provides the
    power cables as part of its obligation to provide for
    interconnection and collocation "on rates, terms, and conditions
    that are just, reasonable, and nondiscriminatory."[^196] As with
    power cables, an incumbent installs and maintains cross-connect
    cables -- or refuses to install and maintain them -- as part of the
    terms and conditions under which the incumbent provides collocation.
    Indeed, the Commission has long considered cross-connects to be part
    of the terms and conditions under which LECs provide
    interconnection.[^197] The exercise of our authority under section
    251(c)(6) is also quite limited in scope and should not be read as
    implying that a requesting carrier is entitled to obtain services
    from the incumbent superior to those the incumbent provides itself,
    its affiliates, subsidiaries, or other parties. On the contrary, our
    action reflects our overriding concern that an incumbent LEC would
    be acting in an unreasonable and discriminatory manner if it refused
    to provide cross-connects between collocators.

80. The requirement that incumbent LECs provision cross-connects between
    collocated carriers is consistent with the original obligation for
    cross-connects that the Commission imposed in the *Local Competition
    Order*.[^198] Although it did not fully amplify its reasoning there,
    the Commission concluded that cross-connects were required under
    section 251(c)(6) to ensure that "collocation be provided 'on . . .
    terms and conditions that are just, reasonable, and
    nondiscriminatory . . . ."[^199] That conclusion is consistent with
    our view that an incumbent LEC's refusal to provide a cross-connect
    between two collocated carriers would violate the incumbent's duties
    under section 251(c)(6) to provide collocation "on . . . terms and
    conditions that are just, reasonable, and nondiscriminatory."[^200]
    Although we now conclude that the Commission overreached in further
    extending competitors' cross-connect rights in the *Advanced
    Services First Report and Order*, we believe the initial approach in
    the *Local Competition Order* was a reasonable interpretation of the
    applicable statutory language.[^201] In particular, we find Qwest's
    arguments in favor of this approach to be persuasive in view of its
    market position as both an incumbent LEC and a competitive
    LEC.[^202]

81. Our decision to require incumbent LEC-provided cross-connects
    pursuant to section 251(c)(6) is not inconsistent with the D.C.
    Circuit Court's opinion. In *GTE v. FCC*, the court found that the
    Commission appeared to have overstepped its authority under section
    251(c)(6) when it required physical collocation of cross-connects in
    the *Advanced Services First Report and Order*.[^203] The D.C.
    Circuit stated that "\[s\]ection 251(c)(6) is focused solely on
    connecting new competitors to \[incumbent\] LECs' networks."[^204]
    We disagree with SBC's position that this statement forecloses us
    from requiring, pursuant to section 251(c)(6), that an incumbent LEC
    provision cross-connects between collocated carriers upon request.
    The court's statement is part of a larger discussion that uses
    cross-connects as an example of how the Commission's prior
    interpretation of "necessary" in section 251(c)(6) might
    unnecessarily take incumbent LEC property.[^205] The court had
    before it a Commission requirement that an incumbent LEC allow
    collocators to self-provision and thus collocate cross-connects
    outside of their immediate collocation space.[^206] The court stated
    that such a requirement "has no *apparent* basis in the statute" and
    observed that the Commission had not attempted to show that
    cross-connects are "necessary for interconnection or access to
    unbundled network elements."[^207] The court did not address
    specifically whether we could require incumbent LEC provisioned
    cross-connects pursuant to the "rates, terms, and conditions" clause
    of section 251(c)(6). Nor did the court address specifically whether
    we could require incumbent LEC provisioned cross-connects pursuant
    to other provisions of the Communications Act.[^208]

82. Our conclusion that an incumbent LEC's provisioning of
    cross-connects to two collocated carriers is required under section
    251(c)(6) reaffirms obligations imposed under the *Local Competition
    Order* and is based, in part, on the same reasons discussed above
    regarding section 201's requirement to provide services in a *just*
    and *reasonable* manner. An incumbent also has a duty to provide
    collocation terms and conditions that are *nondiscriminatory*
    pursuant to section 251(c)(6).[^209] The provisioning of
    cross-connects within the incumbent's premises merely puts the
    collocator in position to achieve the same interconnection with
    other competitive LECs that the incumbent itself is able to achieve.
    Thus, the refusal to provision such cross-connects would be
    discriminatory toward competitive LECs.[^210]

83. In addition, because incumbents provide cross-connects within their
    premises to those collocators that purchase the incumbents'
    transport services, an incumbent LEC's failure to provide
    cross-connects within its premises to collocators that wish to
    utilize a competitive transport provider also raises this
    nondiscrimination issue. Specifically, we find that it would be
    discriminatory not to provide such cross-connects because of the
    vast disparity in costs and efficiency associated with the two
    alternatives. In fact, a failure to provide cross-connects would in
    effect force the competitive LEC to purchase incumbent LEC transport
    in order to access a competitive provider's transport service.

84. Requiring incumbent LECs to provision cross-connects between
    requesting carriers is consistent with the statutory scheme outlined
    in section 251 and is consistent with Congress' explicit goal of
    ensuring interconnected networks. Indeed, pursuant to section
    251(a)(1), all telecommunications carriers have a statutory
    obligation to interconnect directly or indirectly with the
    facilities or equipment of other telecommunications carriers."[^211]
    As we recognized in the *Local Competition Order*, "the duty to
    interconnect directly or indirectly is central to the 1996 Act and
    achieves important policy objectives."[^212] Thus, we believe our
    cross-connect requirement is consistent with and furthers Section
    251's fundamental purpose of promoting the interconnection of all
    telecommunications networks by ensuring that incumbent LECs are not
    the only carriers that are able to interconnect efficiently with
    other carriers. As has been the practice in the past, we anticipate
    that cross-connect disputes, like other interconnection-related
    disputes, can be addressed in the first instance at the state level.

## Space Allocation and Access

### Background

85. Section 251(c)(6) requires incumbent LECs to provide for physical
    collocation "on rates, terms, and conditions that are just,
    reasonable, and nondiscriminatory."[^213] In the *Local Competition
    Order*, the Commission required incumbent LECs to make physical
    collocation space available to requesting carriers on a first-come,
    first-served basis. The Commission also required that collocators
    seeking to expand their collocated space should be allowed to use
    contiguous space where available, and that incumbents should not be
    required to lease or construct additional space to provide physical
    collocation where existing space had been exhausted.[^214] In
    addition, observing that physical security arrangements surrounding
    collocation space protect both incumbent and collocator equipment
    from interference by unauthorized parties, the Commission permitted
    incumbent LECs to require reasonable security arrangements to
    separate collocation space from the incumbents' facilities.[^215]

86. In the *Advanced Services First Report and Order,* the Commission
    amended its physical collocation rules to require that "an incumbent
    LEC must give competitors the option of physically collocating
    equipment in any unused space within the incumbent\'s premises, to
    the extent technically feasible."[^216] The Commission precluded an
    incumbent LEC from restricting physical collocation to "a room or
    isolated space separate from the incumbent\'s own equipment."[^217]
    The Commission specified that, while an incumbent LEC could require
    physical collocators to use a central entrance to the incumbent's
    premises, the incumbent could not require construction of a new
    entrance for these collocators' use.[^218]

87. In *GTE v. FCC*, the D.C. Circuit determined that the Commission had
    not adequately justified these revised rules adopted in the
    *Advanced Services First Report and Order*. The court stated that
    these rules "appear to favor the \[incumbent\] LECs' competitors in
    ways that exceed what is 'necessary' to achieve reasonable 'physical
    collocation' and in ways that may result in unnecessary takings of
    \[incumbent\] LEC property."[^219] The court therefore vacated and
    remanded these rules. The court stated, however, that the Commission
    would have the opportunity on remand to "refine \[its\] regulatory
    requirements to tie the rules to the statutory standard, which only
    mandates physical collocation as 'necessary for interconnection or
    access to unbundled network elements at the premises of the local
    exchange carrier.'"[^220]

88. As discussed below, we find that, in adopting the physical
    collocation rules overturned by the D.C. Circuit, the Commission
    focused primarily on the 1996 Act's goal of promoting competition
    and innovation, without giving sufficient weight to the incumbent
    LECs' property interests. To correct this problem, we adopt rules
    that return decision-making authority regarding space assignments to
    the incumbents, while requiring that incumbents exercise this
    authority in accordance with certain principles designed to ensure
    that their space assignment decisions are made in a just,
    reasonable, and nondiscriminatory manner, as section 251(c)(6)
    requires. These principles will guide the incumbents' space
    assignment decisions and provide general parameters for more
    detailed physical collocation rules that the state commissions may
    craft. We also establish certain presumptions for use in evaluating
    an incumbent LEC's space assignment policies and practices. In
    addition, we discuss incumbent LECs' ability to restrict physical
    collocators to separated space and entrances, recognizing the
    incumbents' right to address legitimate security concerns, but
    balancing that right with the statutory goal of promoting
    competition and innovation.

### Space Assignments

89. With regard to the requirement that an incumbent LEC allow
    requesting carriers to physically collocate in any unused space
    within its premises, the D.C. Circuit held that the Commission had
    not adequately explained "why a competitor, as opposed to the
    \[incumbent\] LEC, should choose where to establish collocation on
    the LEC's property . . ."[^221] In the *Second Further Notice*, the
    Commission therefore invited comment on what space assignment
    policies are necessary to achieve reasonable and nondiscriminatory
    physical collocation that does not result in any "unnecessary
    taking" of incumbent LEC property.[^222] Based on the D.C. Circuit's
    opinion and the record developed in response to the *Second Further
    Notice*, we agree with several parties that the rules adopted in the
    *Advanced Services First Report and Order* failed to properly
    balance the congressional goal of promoting competition against the
    need to protect an incumbent LEC's property interests against
    unwarranted intrusion.[^223]

90. In recognition of the incumbent's right to use and manage its own
    property, we find that each incumbent should maintain ultimate
    responsibility for assigning collocation space within its premises.
    An incumbent is far more familiar with the design and layout of its
    premises than are its competitors, who neither own nor manage those
    premises.[^224] The incumbent is also the only party with direct
    knowledge of all competitive LEC collocation requests, as well as
    all other tenant requirements.[^225] In addition, unlike the
    incumbent LEC, an individual requesting carrier has no duty to
    consider the impact of its collocation space choices on the
    incumbent and other collocators.[^226] Therefore, we believe the
    revised physical collocation rules adopted in the *Advanced Services
    First Report and Order* went too far in removing the incumbent LEC's
    ability to use and manage its own property. Importantly, section
    251(c)(6) does not turn an incumbent LECs' premises into common
    property. Rather, that provision requires that an incumbent LEC make
    space available to competitors within the confines of its own
    private property.

91. In light of the D.C. Circuit's opinion, we disagree with the
    approach of those commenters that recommend blanket re-adoption,
    albeit with some clarification, of the rules vacated in *GTE v. FCC*
    to ensure that physical collocation space is allocated in accordance
    with the statute.[^227] As the D.C. Circuit noted, "\[i\]t is one
    thing to say that \[incumbent\] LECs are forbidden from imposing
    unreasonable minimum space requirements on competitors; it is quite
    another thing, however, to say that competitors, over the objection
    of \[incumbent\] LEC property owners, are free to pick and choose
    preferred space on the \[incumbent\] LECs' premises, subject only to
    technical feasibility."[^228] Ultimately, it is the incumbent who
    will be responsible for planning and maintaining the premises for
    the benefit of all users -- the incumbent, its affiliates and
    subsidiaries, and other collocators.[^229] Allowing requesting
    carriers to exercise primary decision-making authority over space
    assignment decisions would give those carriers the ability to usurp
    an incumbent LEC's right to manage its own property. Such a result
    would go beyond the limits established by the statute.

92. An incumbent LEC, however, must assign space in accordance with the
    statutory requirement that it provide for physical collocation "on
    rates, terms, and conditions that are just, reasonable, and
    nondiscriminatory." We recognize that an incumbent LEC has powerful
    incentives that, left unchecked, may influence it to allocate space
    in a manner inconsistent with this statutory duty. We conclude that
    to meet the statutory standard, an incumbent LEC must act as a
    neutral property owner and manager, rather than as a direct
    competitor of the carrier requesting collocation, in assigning
    physical collocation space. To ensure that competitive concerns do
    not influence an incumbent LEC's space assignment decisions, we
    believe that we should enunciate principles that give more specific
    meaning to the incumbent's statutory duty to provide for physical
    collocation "on rates, terms, and conditions that are just,
    reasonable, and nondiscriminatory." Of course, state commissions
    should continue to play a primary role in resolving specific space
    assignment disputes.

93. First, we require that an incumbent LEC's space assignment policies
    and practices must not materially increase a requesting carrier's
    collocation costs or materially delay a requesting carrier's
    occupation and use of the incumbent LEC's premises. Physical space
    assignments that require costly conditioning or lengthy provisioning
    intervals, when less expensive and quicker alternatives are
    available, simply do not meet the statutory "just, reasonable, and
    nondiscriminatory" standard.[^230] Such space assignment policies
    could also drive competitors to opt for virtual collocation even
    though physical collocation is technically feasible, frustrating the
    1996 Act's preference for physical collocation.[^231] For example,
    it would be presumptively unreasonable for an incumbent to assign
    non-conditioned collocation space to a competitor when technically
    feasible, conditioned space is available within the incumbent's
    premises. This presumption should promote the efficient use of
    conditioned space and will help ensure that physical collocation
    space is made available in a timely manner. An incumbent LEC that
    assigns unconditioned space when conditioned space is available must
    show that operational constraints, unrelated to the incumbent's or
    any of its affiliates' or subsidiaries' competitive concerns,
    require that the requesting carrier be assigned unconditioned space.

94. Second, an incumbent LEC must not assign physical collocation space
    that will impair the quality of service or impose other limitations
    on the service a requesting carrier wishes to offer.[^232] For
    example, the incumbent's choice of space must not materially reduce
    a requesting carrier's ability to reach potential customers.[^233]

95. Third, an incumbent LEC's space assignment policies and practices
    must not reduce unreasonably the total space available for physical
    collocation or preclude unreasonably physical collocation within the
    incumbent's premises.[^234] We recognize that certain space within
    an incumbent LEC's premises will not be suitable for physical
    collocation and, thus, may be withheld from physical collocation
    without violating section 251(c)(6). We find that space within an
    incumbent's premises is generally suitable for physical collocation
    unless it is: (a) physically occupied by non-obsolete equipment; (b)
    assigned to another collocator in accordance with our rules; (c)
    used to provide physical access to occupied space; (d) used to
    enable technicians to work on equipment located within occupied
    space; (e) properly reserved for future use, either by the incumbent
    LEC or by another carrier; or (f) essential for the administration
    and proper functioning of the incumbent LEC's premises.[^235] The
    incumbent may allocate any space that falls outside these categories
    among different uses, including physical collocation, provided that
    the incumbent performs this allocation in accordance with the
    statute, our rules, and any consistent state rules.

96. Although a requesting carrier may not make the final determination
    as to the location of its particular physical collocation space, an
    incumbent LEC must allow a requesting carrier to submit physical
    collocation space preferences prior to assigning that carrier space.
    This will enable the requesting carrier to request the space that
    best fits its operational needs. To request specific space
    intelligently, a requesting carrier will require more information
    than our existing space report rule expressly requires that an
    incumbent provide.[^236] We therefore amend that rule to require
    that, upon request, an incumbent LEC must submit to the requesting
    carrier a report describing in detail the space that is available
    for collocation in a particular incumbent LEC premises. This report
    is due within ten days of its being requested, the same time period
    as in our existing rule.[^237]

97. We believe the approach set forth above will help limit disputes
    over the availability of physical collocation space as well as the
    appropriateness of specific space assignments. This approach also
    will provide requesting carriers with information that will help
    them assess whether the incumbent is meeting its statutory
    obligations, while discouraging each incumbent from abusing its
    discretion in assigning physical collocation space. We do not intend
    to preclude state commissions from imposing additional space
    assignment requirements, as long as they are consistent with the
    terms of the Communications Act and our implementing rules. A
    competitive LEC may challenge a space assignment with the
    appropriate state commission if the competitive LEC believes that
    the assignment is unjust, unreasonable, or discriminatory, violates
    our rules, or violates any additional consistent rules the state
    commission has established.

### Separate Rooms and Entrances

98. In the *Advanced Services First Report and Order*, the Commission
    stated that incumbent LECs must allow competitors to physically
    collocate "without requiring the construction of a room, cage, or
    similar structure, and without requiring the creation of a separate
    entrance to the competitor's collocation space."[^238] Although the
    D.C. Circuit affirmed the Commission's rule requiring incumbent LECs
    to allow cageless collocation, the court held that the Commission
    had not reasonably justified the portions of the rule that forbade
    incumbent LECs "from requiring competitors to use separate entrances
    to access their own equipment" and "from requiring competitors to
    use separate or isolated rooms or floors."[^239] The Commission
    invited comment on whether it might, consistent with section
    251(c)(6), preclude incumbents from placing collocators in a room or
    isolated space separate from the incumbent's own equipment.[^240]
    The Commission also invited comment on whether section 251(c)(6)
    permits an incumbent LEC to require requesting carriers to construct
    or pay for new entrances to the incumbent's premises for the
    collocators' use.[^241]

99. Although we find that it is not *per se* unreasonable or
    discriminatory for an incumbent LEC to restrict physical collocation
    to space segregated from space housing the incumbent's equipment, or
    to require the construction and use of a separate entrance to access
    physical collocation space, we find that it would be unreasonable
    for the incumbent to require such separation measures as a general
    policy. As competitive LECs contend, mandatory separation of
    physical collocation space can substantially increase physical
    collocation costs.[^242] In addition, placement of DSL equipment,
    such as DSLAMs, in isolated or separate space can affect a
    collocator's ability to access unbundled local loops.[^243]
    Moreover, a requirement that all collocators place their equipment
    solely in a particular area of a central office could prematurely
    exhaust physical collocation space.[^244] Similarly, a requirement
    that separate entrances always be built could decrease the space
    available in the central office for collocation;[^245] and adding a
    new entrance to an existing structure could simply delay the
    requesting carrier's occupation and use of the incumbent LEC's
    premises, and increase the requesting carrier's costs.[^246]

100. As a general matter, we find it reasonable to interpret section
     251(c)(6) in a manner that reduces the likelihood that space
     limitations will preclude physical collocation. Although, as
     Verizon points out, virtual collocation is available where separate
     physical collocation space is exhausted,[^247] section 251(c)(6)
     establishes a clear preference for physical over virtual
     collocation -- permitting an incumbent LEC to substitute the latter
     for the former only if the incumbent "demonstrates to the State
     commission that physical collocation is not practical for technical
     reasons or because of space limitations."[^248] An interpretation
     that would allow an incumbent to require separation of equipment or
     separate entrances in all cases, regardless of the potential effect
     on competition, would fail to properly balance the statute's
     competing interests. This is especially true since, in many
     instances, separated equipment and separate entrances are not
     needed to ensure that the incumbent is able to protect its own
     property.[^249]

101. We find, based on the record before us, that there is simply
     insufficient evidence to support a finding that incumbent LECs'
     security concerns require physical separation of collocated
     equipment from the incumbent's own equipment in every instance.
     Incumbents claim that the placement of competitors' equipment in
     the incumbent's premises raises serious security concerns that can
     only be or are best addressed by physical segregation of the
     competitors' equipment from the incumbent's equipment.[^250] In
     contrast, competitors argue that the D.C. Circuit rejected this
     argument, finding that there were "alternative means available to
     \[incumbent\] LECs to ensure . . . security."[^251] Competitors
     also contend that security is not one of the limits established in
     section 251(c)(6) on the incumbent's obligation to provide physical
     collocation.[^252] The D.C. Circuit recognized that incumbents'
     security concerns could be addressed by alternative measures.[^253]
     Our rules currently permit incumbent LECs to install security
     cameras or other monitoring systems, and to require competitive LEC
     personnel to use badges with computerized tracking systems while on
     the incumbent's premises, among other security options.[^254] We
     find that such measures will provide sufficient security for an
     incumbent's equipment in most circumstances.[^255]

102. While we recognize that incumbents, like other users of incumbent
     LEC premises, have a right to protect their equipment from
     harm,[^256] incumbents also have incentives to overstate security
     concerns so as to limit physical collocation arrangements and
     discourage competition.[^257] We therefore conclude that an
     incumbent LEC may require the separation of collocated equipment
     from its own equipment only if the proposed separated space is: (a)
     available in the same or a shorter time frame as non-separated
     space; (b) at a cost not materially higher than the cost of
     non-separated space; and (c) is comparable, from a technical and
     engineering standpoint, to non-separated space. We also conclude
     that an incumbent LEC may require such separation measures only
     where legitimate security concerns, or operational constraints
     unrelated to the incumbent's or any of its affiliates' or
     subsidiaries competitive concerns, warrant them. We believe this
     policy will help promote the efficient use of limited space and
     thereby advance the statutory preference for physical over virtual
     collocation. We also believe that this policy reasonably balances
     the congressional goal of promoting competition against the
     incumbent's right to use and manage its own property.

103. While we reject an interpretation of section 251(c)(6) that would
     allow incumbent LECs to require, without exception, that
     competitors use segregated collocation space and separate
     entrances, this does not mean an incumbent LEC may never make use
     of segregated collocation space and separate entrances. Separate
     entrance requirements will meet the "just, reasonable, and
     nondiscriminatory" standard only where a separate entrance already
     exists that provides access to the collocation space at issue, or
     where construction of such an entrance is technically feasible, and
     will neither artificially delay collocation provisioning nor
     materially increase the requesting carrier's costs.[^258] In
     addition, an incumbent LEC may construct or require the
     construction of a separated entrance only where legitimate security
     concerns, or operational constraints unrelated to the incumbent's
     or any of its affiliates' or subsidiaries competitive concerns,
     warrant them. Similarly, where an incumbent LEC assigns separated
     space for collocation or requires requesting carriers to access
     their collocated equipment through a separate entrance, the
     incumbent LEC's affiliates and subsidiaries and their employees and
     contractors must also be subject to such restrictions. An incumbent
     LEC may require collocators to pay only for the least expensive,
     effective security option that is viable for the physical
     collocation space assigned.[^259] Otherwise, the incumbent would be
     providing collocation on unreasonable terms and conditions.

104. As with space assignment objections generally, a competitive LEC
     may challenge a separate space assignment or a separate entrance
     requirement with the appropriate state commission if the
     competitive LEC believes the assignment or requirement is unjust,
     unreasonable, discriminatory, violates our rules, or violates any
     additional, consistent rules the state commission has established.

# procedural matters

## Final Regulatory Flexibility Analysis

105. As required by the Regulatory Flexibility Act (RFA),[^260] an
     Initial Regulatory Flexibility Analysis (IRFA) was incorporated in
     the *Second Further Notice of Proposed Rulemaking* in CC Docket No.
     98-147.[^261] The Commission sought written public comment on the
     proposals in *Second Further Notice*, including comment on the
     IRFA.[^262] Appendix C sets forth a Final Regulatory Flexibility
     Analysis for the present *Fourth Report and Order*.

## Final Paperwork Reduction Act Analysis

106. The *Second Further Notice of Proposed Rulemaking* from which this
     *Fourth Report and Order* issues proposed changes to the
     Commission\'s collocation requirements. As required by the
     Paperwork Reduction Act of 1995, the Commission sought comment from
     the public and from OMB on the proposed changes.[^263] This *Order*
     contains new or modified reporting and recordkeeping requirements
     or burdens that are being submitted to the Office of Management and
     Budget (OMB) for approval. Implementation of these information
     collections is subject to OMB approval, as prescribed by the
     Paperwork Reduction Act.

# ORDERING CLAUSES

107. Accordingly, IT IS ORDERED, pursuant to sections 1-4, 201, 202,
     251-254, 256, 271, and 303(r) of the Communications Act of 1934, as
     amended, 47 U.S.C. §§ 151-54, 201, 202, 251-54, 256, 271, and
     303(r), that this *Fourth Report and Order* IS ADOPTED.

108. IT IS FURTHER ORDERED, pursuant to sections 1-4, 201, 202, 251-54,
     256, 271, and 303(r) of the Communications Act of 1934, as amended,
     47 U.S.C. §§ 151-54, 201, 202, 251-54, 256, 271, and 303(r), that
     Part 51 of the Commission's rules, 47 C.F.R. Part 51, IS AMENDED,
     as set forth in Appendix B, and that those rule amendments SHALL
     BECOME EFFECTIVE thirty days after publication of the text or
     summary thereof in the Federal Register, unless the Commission
     publishes a document in the Federal Register to delay or withdraw
     them.

109. IT IS FURTHER ORDERED that the Commission\'s Consumer Information
     Bureau, Reference Information Center, SHALL SEND a copy of this
     *Fourth Report and Order*, including the Final Regulatory
     Flexibility Analysis, to the Chief Counsel for Advocacy of the
     Small Business Administration.

     FEDERAL COMMUNICATIONS COMMISSION

Magalie Roman Salas

Secretary

# APPENDIX A \-- LIST OF PARTIES 

**Comments**

1.  \@Link Networks, Inc. (@Link)

2.  Advanced Telecom Group, Inc. (ATG)

3.  Alcatel USA, Inc. (Alcatel)

4.  AT&T Corp. (AT&T)

5.  BellSouth Corporation (BellSouth)

6.  Catena Networks, Inc. (Catena)

7.  Cisco Systems, Inc. (Cisco)

8.  CompTel (CompTel)

9.  Conectiv Communications, Inc. (Connectiv)

10. CoreComm, Inc., Vitts Networks, Inc., and Logix, Inc. (CoreComm)

11. Covad Communications Company (Covad)

12. CTSI, Inc. and Waller Creek Communications Inc. d/b/a Pontio
    Communications Corporation (CTSI)

13. DSLnet Communications, LLC (DSLnet)

14. Fiber Technologies, LLC (Fiber Technologies)

15. Florida Public Service Commission (Florida Commission)

16. Focal Communications Corporation (Focal)

17. Gluon Networks (Gluon)

18. General Services Administration (GSA)

19. IntraSpan Communications, Inc. (IntraSpan)

20. IP Communications Corporation (IP Communications)

21. Arbros Communications, Inc., the Association for Local
    Telecommunications Services, the Competitive Telecommunications
    Association, e.spire Communications, Inc., Fairpoint Communications
    Solutions, Inc., Intermedia Communications Inc., KMC Telecom, Inc.,
    NewSouth Communications, Inc., and Pathnet (Joint Commenters)

22. LightBonding.com, Inc. (LightBonding.com)

23. Metromedia Fiber Network Services, Inc. (Metromedia)

24. McLeodUSA Telecommunications Services, Inc. (McLeod)

25. Mpower Communications Corp. (Mpower)

26. Network Access Solutions Corporation (NAS)

27. Network Telephone Corporation (Network Telephone)

28. New York State Department of Public Service (New York Commission)

29. Nortel Networks Inc. (Nortel)

30. NorthPoint Communications, Inc. (NorthPoint)

31. Organization for the Promotion and Advancement of Small
    Telecommunications Companies (OPASTCO)

32. PF.Net Communications, Inc. (PF.Net)

33. Rhythms NetConnections, Inc. (Rhythms)

34. RCN Telecom Services Inc. (RCN)

35. Rural Independent Competitive Alliance (RICA)

36. SBC Communications, Inc. (SBC)

37. Sprint Corporation (Sprint)

38. Supra Telecommunications & Information Systems, Inc. (Supra)

39. Tachion Networks, Inc. (Tachion)

40. The Walt Disney Company (Walt Disney)

41. Telergy, Inc., Adelphia Business Solutions, Inc. and Business
    Telecommunications, Inc. (Telergy)

42. Qwest Corporation (Qwest)

43. United States Telecom Association (USTA)

44. Verizon Telephone Companies (Verizon)

45. Winstar Communications, Inc. (Winstar)

46. WorldCom (WorldCom)

    **Replies**

```{=html}
<!-- -->
```
1.  ATG

2.  Alcatel

3.  AT&T

4.  Aptonix, Ltd. (Aptonix)

5.  BellSouth

6.  Catena

7.  CompTel

8.  Focal

9.  GSA

10. IP Communications

11. Joint Commenters

12. Lucent Technologies, Inc. (Lucent)

13. Metromedia

14. Mpower

15. NAS

16. Network Telephone

17. Qwest Communications International, Inc. (Qwest)

18. Rhythms

19. SBC

20. Sprint

21. Telecommunications Industry Association (TIA)

22. Verizon

23. WorldCom

**Ex Parte Letters**

1.  Allegiance Telecom, Inc. (Allegiance)

2.  Association for Local Telecommunications Services (ALTS)

3.  ATG

4.  AT&T

5.  Birch Telecom (Birch)

6.  BroadSlate Networks, Inc. (Broadslate)

7.  BellSouth

8.  Catena

9.  Cbeyond Communications (Cbeyond)

10. Comptel

11. Conversent Communications (Conversent)

12. Copper Mountain Networks (Copper Mountain)

13. Covad

14. DSLnet

15. Focal

16. Global Metro Networks (Global Metro)

17. Kellogg, Huber, Hansen, Todd & Evans (Kellogg, Huber)

18. Metromedia

19. Mpower

20. Network Telephone

21. Qwest

22. Rhythms

23. SBC

24. Sprint

25. Tachion

26. Taqua Systems, Inc.

27. Verizon

28. Westwave Communications (Westwave)

29. WorldCom

30. Zhone Technologies, Inc. (Zhone)

# APPENDIX B -- FINAL RULES

Part 51 of Title 47 of the Code of Federal Regulations is amended as
follows:

# PART 51 \-- INTERCONNECTION

## 1. The authority for Part 51 continues to read as follows: {#the-authority-for-part-51-continues-to-read-as-follows .unnumbered}

Authority: Sections 1-5, 7, 201-05, 207-09, 218, 225-27, 251-54, 271,
332, 48 Stat. 1070, as amended, 1077; 47 U.S.C. 151-55, 157, 201-05,
207-09, 218, 225-27, 251-54, 271, 332, unless otherwise noted.

## 2. § 51.5 is amended by adding in alphabetical order a definition of "multi-functional equipment" to read as follows: {#is-amended-by-adding-in-alphabetical-order-a-definition-of-multi-functional-equipment-to-read-as-follows .unnumbered}

\*\*\*\*\*

*Multi-functional equipment.* Multi-functional equipment is equipment
that combines one or more functions that are necessary for
interconnection or access to unbundled network elements with one or more
functions that would not meet that standard as stand-alone functions.

\*\*\*\*\*

## 3. § 51.321 is amended by revising paragraph (h) to read as follows: {#is-amended-by-revising-paragraph-h-to-read-as-follows .unnumbered}

\*\*\*\*\*

\(h\) Upon request, an incumbent LEC must submit to the requesting
carrier within ten days of the submission of the request a report
describing in detail the space that is available for collocation in a
particular incumbent LEC premises. This report must specify the amount
of collocation space available at each requested premises, the number of
collocators, and any modifications in the use of the space since the
last report. This report must also include measures that the incumbent
LEC is taking to make additional space available for collocation. The
incumbent LEC must maintain a publicly available document, posted for
viewing on the incumbent LEC's publicly available Internet site,
indicating all premises that are full, and must update such a document
within ten days of the date at which a premises runs out of physical
collocation space.

\*\*\*\*\*

## 4. § 51.323 is amended by revising paragraphs (b), (c), (e), (f), (h), (i), and (k) to read as follows: {#is-amended-by-revising-paragraphs-b-c-e-f-h-i-and-k-to-read-as-follows .unnumbered}

\*\*\*\*\*

\(b\) An incumbent LEC shall permit the collocation and use of any
equipment necessary for interconnection or access to unbundled network
elements.

\(1\) Equipment is necessary for interconnection if an inability to
deploy that equipment would, as a practical, economic, or operational
matter, preclude the requesting carrier from obtaining interconnection
with the incumbent LEC at a level equal in quality to that which the
incumbent obtains within its own network or the incumbent provides to
any affiliate, subsidiary, or other party.

\(2\) Equipment is necessary for access to an unbundled network element
if an inability to deploy that equipment would, as a practical,
economic, or operational matter, preclude the requesting carrier from
obtaining nondiscriminatory access to that unbundled network element,
including any of its features, functions, or capabilities.

\(3\) Multi-functional equipment shall be deemed necessary for
interconnection or access to an unbundled network element if and only if
the primary purpose and function of the equipment, as the requesting
carrier seeks to deploy it, meets either or both of the standards set
forth in paragraphs (b)(1) and (b)(2) of this section. For a piece of
equipment to be utilized primarily to obtain equal in quality
interconnection or nondiscriminatory access to one or more unbundled
network elements, there also must be a logical nexus between the
additional functions the equipment would perform and the
telecommunication services the requesting carrier seeks to provide to
its customers by means of the interconnection or unbundled network
element. The collocation of those functions of the equipment that, as
stand-alone functions, do not meet either of the standards set forth in
paragraphs (b)(1) and (b)(2) of this section must not cause the
equipment to significantly increase the burden on the incumbent's
property.

\(c\) Whenever an incumbent LEC objects to collocation of equipment by a
requesting telecommunications carrier for purposes within the scope of
section 251(c)(6) of the Act, the incumbent LEC shall prove to the state
commission that the equipment is not necessary for interconnection or
access to unbundled network elements under the standards set forth in
paragraph (b) of this section. An incumbent LEC may not object to the
collocation of equipment on the grounds that the equipment does not
comply with safety or engineering standards that are more stringent than
the safety or engineering standards that the incumbent LEC applies to
its own equipment. An incumbent LEC may not object to the collocation of
equipment on the ground that the equipment fails to comply with Network
Equipment and Building Specifications performance standards or any other
performance standards. An incumbent LEC that denies collocation of a
competitor's equipment, citing safety standards, must provide to the
competitive LEC within five business days of the denial a list of all
equipment that the incumbent LEC locates at the premises in question,
together with an affidavit attesting that all of that equipment meets or
exceeds the safety standard that the incumbent LEC contends the
competitor's equipment fails to meet. This affidavit must set forth in
detail: the exact safety requirement that the requesting carrier's
equipment does not satisfy; the incumbent LEC's basis for concluding
that the requesting carrier's equipment does not meet this safety
requirement; and the incumbent LEC's basis for concluding why
collocation of equipment not meeting this safety requirement would
compromise network safety.

\*\*\*\*\*

\(e\) When providing virtual collocation, an incumbent LEC shall, at a
minimum, install, maintain, and repair collocated equipment meeting the
standards set forth in paragraph (b) of this section within the same
time periods and with failure rates that are no greater than those that
apply to the performance of similar functions for comparable equipment
of the incumbent LEC itself.

\(f\) An incumbent LEC shall provide space for the collocation of
equipment meeting the standards set forth in paragraph (b) of this
section in accordance with the following requirements:

\*\*\*\*\*

\(5\) An incumbent LEC shall relinquish any space held for future use
before denying a request for virtual collocation on the grounds of space
limitations, unless the incumbent LEC proves to the state commission
that virtual collocation at that point is not technically feasible;

\(6\) An incumbent LEC may impose reasonable restrictions on the
warehousing of unused space by collocating telecommunications carriers,
provided, however, that the incumbent LEC shall not set maximum space
limitations applicable to such carriers unless the incumbent LEC proves
to the state commission that space constraints make such restrictions
necessary;

\(7\) An incumbent LEC must assign collocation space to requesting
carriers in a just, reasonable, and nondiscriminatory manner. An
incumbent LEC must allow each carrier requesting physical collocation to
submit space preferences prior to assigning physical collocation space
to that carrier. At a minimum, an incumbent LEC's space assignment
policies and practices must meet the following principles:

\(A\) An incumbent LEC's space assignment policies and practices must
not materially increase a requesting carrier's collocation costs.

\(B\) An incumbent LEC's space assignment policies and practices must
not materially delay a requesting carrier occupation and use of the
incumbent LEC's premises.

\(C\) An incumbent LEC must not assign physical collocation space that
will impair the quality of service or impose other limitations on the
service a requesting carrier wishes to offer.

\(D\) An incumbent LEC's space assignment policies and practices must
not reduce unreasonably the total space available for physical
collocation or preclude unreasonably physical collocation within the
incumbent's premises.

\*\*\*\*\*

\(h\) As described in subparagraphs (1) and (2) of this paragraph, an
incumbent LEC shall permit a collocating telecommunications carrier to
interconnect its network with that of another collocating
telecommunications carrier at the incumbent LEC\'s premises and to
connect its collocated equipment to the collocated equipment of another
telecommunications carrier within the same premises, provided that the
collocated equipment is also used for interconnection with the incumbent
LEC or for access to the incumbent LEC\'s unbundled network elements.

\(1\) An incumbent LEC shall provide, at the request of a collocating
telecommunications carrier, a connection between the equipment in the
collocated spaces of two or more telecommunications carriers, except to
the extent the incumbent LEC permits the collocating parties to provide
the requested connection for themselves or a connection is not required
under paragraph (h)(2) of this section. Where technically feasible, the
incumbent LEC shall provide the connection using copper, dark fiber, lit
fiber, or other transmission medium, as requested by the collocating
telecommunications carrier.

\(2\) An incumbent LEC is not required to provide a connection between
the equipment in the collocated spaces of two or more telecommunications
carriers if the connection is requested pursuant to section 201 of the
Act, unless the requesting carrier submits to the incumbent LEC a
certification that more than 10 percent of the amount of traffic to be
transmitted through the connection will be interstate. The incumbent LEC
cannot refuse to accept the certification, but instead must provision
the service promptly. Any incumbent LEC may file a section 208 complaint
with the Commission challenging the certification if it believes that
the certification is deficient. No such certification is required for a
request for such connection under section 251 of the Act.

\(i\) As provided herein, an incumbent LEC may require reasonable
security arrangements to protect its equipment and ensure network
reliability. An incumbent LEC may only impose security arrangements that
are as stringent as the security arrangements that the incumbent LEC
maintains at its own premises for its own employees or authorized
contractors. An incumbent LEC must allow collocating parties to access
their collocated equipment 24 hours a day, seven days a week, without
requiring either a security escort of any kind or delaying a
competitor\'s employees\' entry into the incumbent LEC\'s premises. An
incumbent LEC may require a collocating carrier to pay only for the
least expensive, effective security option that is viable for the
physical collocation space assigned. Reasonable security measures that
the incumbent LEC may adopt include:

\*\*\*\*\*

\(4\) Restricting physical collocation to space separated from space
housing the incumbent LEC's equipment, provided that each of the
following conditions is met:

\(i\) Either legitimate security concerns, or operational constraints
unrelated to the incumbent's or any of its affiliates' or subsidiaries
competitive concerns, warrant such separation;

\(ii\) Any physical collocation space assigned to an affiliate or
subsidiary of the incumbent LEC is separated from space housing the
incumbent LEC's equipment;

\(iii\) The separated space will be available in the same time frame as,
or a shorter time frame than, non-separated space;

\(iv\) The cost of the separated space to the requesting carrier will
not be materially higher than the cost of non-separated space; and

\(v\) The separated space is comparable, from a technical and
engineering standpoint, to non-separated space.

\(5\) Requiring the employees and contractors of collocating carriers to
use a central or separate entrance to the incumbent\'s building,
provided, however, that where an incumbent LEC requires that the
employees or contractors of collocating carriers access collocated
equipment only through a separate entrance, employees and contractors of
the incumbent LEC's affiliates and subsidiaries must be subject to the
same restriction.

\(6\) Constructing or requiring the construction of a separate entrance
to access physical collocation space, provided that each of the
following conditions is met:

\(i\) Construction of a separate entrance is technically feasible;

\(ii\) Either legitimate security concerns, or operational constraints
unrelated to the incumbent's or any of its affiliates' or subsidiaries
competitive concerns, warrant such separation;

\(iii\) Construction of a separate entrance will not artificially delay
collocation provisioning; and

\(iv\) Construction of a separate entrance will not materially increase
the requesting carrier's costs.

\*\*\*\*\*

\(k\) An incumbent LEC\'s physical collocation offering must include the
following:

\*\*\*\*\*

\(2\) *Cageless collocation.* Incumbent LECs must allow competitors to
collocate without requiring the construction of a cage or similar
structure. Incumbent LECs must permit collocating carriers to have
direct access to their equipment. An incumbent LEC may not require
competitors to use an intermediate interconnection arrangement in lieu
of direct connection to the incumbent\'s network if technically
feasible. An incumbent LEC must make cageless collocation space
available in single‑bay increments, meaning that a competing carrier can
purchase space in increments small enough to collocate a single rack, or
bay, of equipment.

\*\*\*\*\*

APPENDIX C

# Final Regulatory Flexibility Analysis {#final-regulatory-flexibility-analysis-1 .unnumbered}

1.  As required by the Regulatory Flexibility Act (RFA),[^264] a
    Supplemental Initial Regulatory Flexibility Analysis (Supplemental
    IRFA) was incorporated in the *Order on Reconsideration and Second
    Further Notice of Proposed Rulemaking* (*Second Further Notice*) in
    CC Docket 98-147.[^265] The Commission sought written public comment
    on the proposals in the *Second Further Notice*, including comment
    on the Supplemental IRFA.[^266] We received comments from The
    Organization for the Promotion and Advancement of Small
    Telecommunications Companies (OPASTCO) specifically directed toward
    the Supplemental IRFA. These comments are discussed below. This
    Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

## Need for, and Objectives of, the Fourth Report and Order 

110. This *Fourth Report and Order* (*Order*) continues the Commission's
     efforts to facilitate the development of competition in
     telecommunications services. In the *Advanced Services First Report
     and Order*, the Commission strengthened its collocation rules to
     reduce the costs and delays faced by carriers that seek to
     collocate equipment at the premises of incumbent local exchange
     carriers (incumbent LECs). In *GTE v. FCC*, the D.C. Circuit
     vacated several of those rules and remanded the case to the
     Commission. In this *Order*, we address the remanded issues and
     take additional steps toward implementing Congress' goals in
     enacting section 251(c)(6) of the Communications Act. Specifically,
     we adopt rule amendments that more appropriately implement the
     balance reflected in the Communications Act, between promoting
     competition and technological innovation, and establishing limits
     on the scope of the intrusion allowed into the incumbent LEC's
     property rights to avoid unnecessary takings of such property.
     Nonetheless, through these amended rules, we reaffirm our
     commitment to ensuring that facilities-based competitors, including
     those that are small entities, have the incentive and ability to
     invest in alternative infrastructure and innovative technologies,
     while, at the same time, ensuring that incumbents retain similar
     incentives and capabilities.

## Summary of Significant Issues Raised by Public Comments in Response to the Supplemental IRFA

111. In the Supplemental IRFA, we stated that any rule changes would
     impose minimum burdens on small entities, including both
     telecommunications carriers that request collocation and the
     incumbent LECs that, under section 251(c)(6) of the Communications
     Act, must provide collocation to requesting carriers. We also
     solicited comments on alternatives to the proposed rules that would
     minimize the impact that any changes to our rules might have on
     small entities.[^267] In their comments, OPASTCO states that the
     Supplemental IRFA did not provide "the flexibility necessary to
     accommodate the needs of small \[incumbent LECs\] and their
     customers."[^268] OPASTCO also states that the Supplemental IRFA
     does not specify the specific requirements that might be imposed on
     small incumbent LECs or the extent to which those requirements
     might burden small incumbent LECs.[^269] Finally, OPASTCO states
     that the Supplemental IRFA failed "to describe the 'significant
     alternatives' for small \[incumbent LECs\] that \[were\]
     presumptively under consideration" in this rulemaking.[^270] As
     noted above, OPASTCO filed comments specifically directed to the
     Supplemental IRFA and to issues that were raised in the *Notice*
     but not addressed in this *Order* which is limited to issues that
     the D.C. Circuit remanded. In making the determinations reflected
     in the *Order*, we have considered the impact of our actions on
     small entities.

## Description and Estimate of the Number of Small Entities To Which Rules Will Apply

112. The RFA directs agencies to provide a description of and, where
     feasible, an estimate of the number of entities that will be
     affected by the rules.[^271] The RFA defines "small entity" as
     having the same meaning as the term "small business," "small
     organization," and "small governmental jurisdiction."[^272] In
     addition, the term "small business" has the same meaning as the
     term "small business concern" under the Small Business Act, unless
     the Commission has developed one or more definitions that are
     appropriate to its activities.[^273] Under the Small Business Act,
     a "small business concern" is one that: (1) is independently owned
     and operated; (2) is not dominant in its field of operation;
     and (3) meets any additional criteria established by the Small
     Business Administration (SBA).[^274] In this *Order*, we take a
     number of steps that may affect small entities that either provide
     or obtain collocation pursuant to section 251(c)(6) of the
     Communications Act. The requirements we adopt will require small
     incumbent LECs to change their collocation practices. As Congress
     contemplated in enacting section 251(c)(6), however, our
     collocation requirements benefit small competitive local exchange
     carriers (competitive LECs) in their efforts to compete against
     incumbent LECs in the provision of telecommunications services,
     including advanced services. We believe that, on balance, the
     benefits to small competitive LECs of our actions in this O*rder*
     far outweigh any burdens these place on small incumbent LECs.

113. The most reliable source of information regarding the total numbers
     of certain common carrier and related providers nationwide, as well
     as the number of commercial wireless entities, appears to be data
     the Commission publishes annually in its *Carrier Locator* report,
     which encompasses data compiled from FCC Form 499-A
     Telecommunications Reporting Worksheets.[^275] According to data in
     the most recent report, there are 4,822 service providers.[^276]
     These carriers include, *inter alia*, providers of telephone
     exchange service, wireline carriers and service providers, LECs,
     interexchange carriers, competitive access providers, and
     resellers.

114. We have included small incumbent LECs in this present RFA analysis.
     A "small business" under the RFA is one that, *inter alia*, meets
     the pertinent small business size standard (*e.g.*, a telephone
     communications business having 1,500 or fewer employees), and "is
     not dominant in its field of operation."[^277] The SBA\'s Office of
     Advocacy contends that, for RFA purposes, small incumbent LECs are
     not dominant in their field of operation because any such dominance
     is not "national" in scope.[^278] We have therefore included small
     incumbent LECs in this RFA analysis, although we emphasize that
     this RFA action has no effect on FCC analyses and determinations in
     other, non-RFA contexts.

115. **Total Number of Telephone Companies Affected.** The United States
     Bureau of the Census (Census Bureau) reports that, at the end of
     1992, there were 3,497 firms engaged in providing telephone
     services, as defined therein, for at least one year.[^279] This
     number contains a variety of different categories of carriers,
     including local exchange carriers, interexchange carriers,
     competitive access providers, cellular carriers, mobile service
     carriers, operator service providers, pay telephone operators,
     covered specialized mobile radio providers, and resellers. It seems
     certain that some of these 3,497 telephone service firms may not
     qualify as small entities or small incumbent LECs because they are
     not "independently owned and operated."[^280] For example, a
     personal communications service (PCS) provider that is affiliated
     with an interexchange carrier having more than 1,500 employees
     would not meet the definition of a small business. It is reasonable
     to conclude that fewer than 3,497 telephone service firms are small
     entity telephone service firms or small incumbent LECs that may be
     affected by the proposed rules, herein adopted.

116. **Wireline Carriers and Service Providers.** The SBA has developed
     a definition of small entities for telephone communications
     companies other than radiotelephone (wireless) companies. The
     Census Bureau reports that there were 2,321 such telephone
     companies in operation for at least one year at the end of
     1992.[^281] According to the SBA\'s definition, a small business
     telephone company other than a radiotelephone (wireless) company is
     one employing no more than 1,500 persons.[^282] All but 26 of the
     2,321 non-radiotelephone (wireless) companies listed by the Census
     Bureau were reported to have fewer than 1,000 employees. Thus, even
     if all 26 of those companies had more than 1,500 employees, there
     would still be 2,295 non‑radiotelephone (wireless) companies that
     might qualify as small entities or small incumbent LECs. We do not
     have data specifying the number of these carriers that are not
     independently owned and operated, and thus are unable at this time
     to estimate with greater precision the number of wireline carriers
     and service providers that would qualify as small business concerns
     under the SBA\'s definition. Consequently, we estimate that fewer
     than 2,295 small telephone communications companies other than
     radiotelephone (wireless) companies are small entities or small
     incumbent LECs that may be affected by the proposed rules, herein
     adopted.

117. **Local Exchange Carriers.** Neither the Commission nor the SBA has
     developed a definition for small providers of local exchange
     service (LECs). The closest applicable definition under the SBA
     rules is for telephone communications companies other than
     radiotelephone (wireless) companies.[^283] According to the most
     recent data, there are 1,395 incumbent and other LECs.[^284] We do
     not have data specifying the number of these carriers that are
     either dominant in their field of operations, are not independently
     owned and operated, or have more than 1,500 employees, and thus are
     unable at this time to estimate with greater precision the number
     of LECs that would qualify as small business concerns under the
     SBA\'s definition. Consequently, we estimate that fewer than 1,395
     providers of local exchange service are small entities or small
     incumbent LECs that may be affected by the proposed rules, herein
     adopted.

118. **Interexchange Carriers**. Neither the Commission nor the SBA has
     developed a definition of small entities specifically applicable to
     providers of interexchange services (IXCs). The closest applicable
     definition under the SBA rules is for telephone communications
     companies other than radiotelephone (wireless) companies.[^285]
     According to the most recent data, there are 204 carriers engaged
     in the provision of interexchange services.[^286] We do not have
     data specifying the number of these carriers that are not
     independently owned and operated or have more than 1,500 employees,
     and thus are unable at this time to estimate with greater precision
     the number of IXCs that would qualify as small business concerns
     under the SBA\'s definition. Consequently, we estimate that there
     are less than 204 small entity IXCs that may be affected by the
     proposed rules, herein adopted.

119. **Competitive Access Providers.** Neither the Commission nor the
     SBA has developed a definition of small entities specifically
     applicable to competitive access services providers (CAPs). The
     closest applicable definition under the SBA rules is for telephone
     communications companies other than except radiotelephone
     (wireless) companies.[^287] According to the most recent data,
     there are 349 CAPs and competitive LECs engaged in the provision of
     competitive local exchange services.[^288] We do not have data
     specifying the number of these carriers that are not independently
     owned and operated, or have more than 1,500 employees, and thus are
     unable at this time to estimate with greater precision the number
     of CAPs that would qualify as small business concerns under the
     SBA\'s definition. Consequently, we estimate that there are less
     than 349 small entity CAPs providing competitive local exchange
     services that may be affected by the proposed rules, herein
     adopted.

120. **Resellers (including debit card providers).** Neither the
     Commission nor the SBA has developed a definition of small entities
     specifically applicable to resellers. The closest applicable SBA
     definition for a reseller is a telephone communications company
     other than radiotelephone (wireless) companies.[^289] According to
     the most recent data, there are 541 local and toll resellers
     engaged in the resale of telephone service.[^290] We do not have
     data specifying the number of these carriers that are not
     independently owned and operated or have more than 1,500 employees,
     and thus are unable at this time to estimate with greater precision
     the number of resellers that would qualify as small business
     concerns under the SBA\'s definition. Consequently, we estimate
     that there are fewer than 541 small local and toll resellers that
     may be affected by the proposed rules, herein adopted.

121. **Wireless Communications Services.** This service can be used for
     fixed, mobile, radiolocation and digital audio broadcasting
     satellite uses. The Commission defined "small business" for the
     wireless communications services (WCS) auction as an entity with
     average gross revenues of \$40 million for each of the three
     preceding years, and a "very small business" as an entity with
     average gross revenues of \$15 million for each of the three
     preceding years. The SBA has approved these definitions.[^291] The
     Commission auctioned geographic area licenses in the WCS service.
     In the auction, there were seven winning bidders that qualified as
     very small business entities, and one that qualified as a small
     business entity. We conclude that the number of geographic area WS
     licenses affected includes these eight entities.

## Description of Projected Reporting, Record Keeping, and Other Compliance Requirements

122. The *Order* imposes nominal increases in projected reporting,
     record keeping, and other compliance requirements. Both of these
     changes affect small and large companies equally. First, the order
     requires a competitive LEC that is requesting incumbent-LEC
     provisioned cross-connects pursuant to section 201 of the Act to
     provide a short certification that the amount of interstate traffic
     to be transmitted over the cross-connect constitutes more than ten
     percent of all traffic transmitted over that cross-connect. This
     certification requirement stems from jurisdictional considerations.
     Thus, it is not possible to exempt small entities from compliance
     with the certification requirement.

123. In the *Order*, we require that an incumbent LEC must allow a
     requesting carrier to submit physical collocation space preferences
     prior to assigning that carrier space. This will enable the
     requesting carrier to request the space that best fits its
     operational needs. We also amend our existing space report rule to
     require that, upon request, an incumbent LEC must submit to the
     requesting carrier a report describing in detail the space that is
     available for collocation in a particular incumbent LEC premises.
     Thus, the new rule requires more detailed information within a
     report that already must be provided. A professional would likely
     prepare the additional information in a limited period of time. To
     give the rule any meaning, this report must be generated by small
     and large entities alike. Otherwise, carriers requesting
     collocation at a small incumbent LEC's facility would not have the
     all of the information available to make an educated space
     preference request.

## Steps Taken to Minimize Significant Economic Impact on Small Entities and Significant Alternatives Considered

124. The RFA requires an agency to describe any significant alternatives
     that it has considered in reaching its proposed approach, which may
     include the following four alternatives (among others): (1) the
     establishment of differing compliance or reporting requirements or
     timetables that take into account the resources available to small
     entities; (2) the clarification, consolidation, or simplification
     of compliance or reporting requirements under the rule for small
     entities; (3) the use of performance, rather than design,
     standards; and (4) an exemption from coverage of the rule, or any
     part thereof, for small entities.[^292]

125. In this *Order*, we adopt collocation rules in implementation of
     section 251(c)(6) of the Communications Act. These rules respond to
     the D.C. Circuit's decision in *GTE v. FCC*, remanding certain
     rules the Commission had adopted to implement that provision. Our
     actions will affect both telecommunications carriers that request
     collocation and the incumbent LECs that, under section 251(c)(6),
     must provide collocation. As indicated above, both groups of
     carriers include entities that, for purposes of this FRFA, are
     classified as small entities. Neither section 251(c)(6) nor the
     D.C. Circuit decision permits the Commission to exempt any
     incumbent LECs, including those that are small entities, from their
     collocation obligations. Indeed, section 10(d) of the
     Communications Act precludes the Commission from forbearing from
     the application of section 251(c)(6) to any entity prior to that
     section's full implementation, an event that has not yet
     occurred.[^293]

126. In this O*rder*, we take a number of steps that may affect small
     entities that either provide or obtain collocation pursuant to
     section 251(c)(6) of the Communications Act. The requirements we
     adopt will require incumbent LECs to change their collocation
     practices. As Congress contemplated in enacting section 251(c)(6),
     our collocation requirements benefit small competitive LECs in
     their efforts to compete against incumbent LECs, both large and
     small, in the provision of telecommunications services, including
     advanced services. We believe that, on balance, the benefits to
     small competitive LECs of our actions in this *Order* far outweigh
     any burdens the *Order* places on small incumbent LECs.

127. As set forth more fully below, we believe that our actions in this
     *Order* are consistent with the RFA. Specifically, as OPASTCO
     urges, the requirements we adopt provide substantial flexibility to
     incumbent LECs, including small incumbent LECs, in implementing
     section 251(c)(6).[^294] Our requirements, however, stop short of
     allowing any incumbent LEC to act inconsistent with that statutory
     provision. Any such action would be inconsistent with the
     requirements of section 251(c)(6) and would upset the balance
     reflected in the statute. Such action also would substantially
     burden competitive LECs, including those that are small entities,
     in their efforts to compete against incumbent LECs.

128. The record makes clear that, absent the adoption of rules
     addressing the matters remanded by the D.C. Circuit, incumbent LECs
     will impede requesting carriers' collocation efforts. Our actions
     in this *Order* should benefit requesting carriers, many of which
     may be small entities, by reducing barriers they encounter in
     seeking to compete effectively in the provision of advanced
     services and other telecommunications services. Our actions seek to
     balance the property interests of the incumbent LECs, including
     small incumbent LECs, with the public interest in promoting
     innovation and competition. We conclude that rules that are more
     restrictive or less restrictive would not strike the appropriate
     balance.

129. In this *Order*, we adopt standards that determine which
     competitive LECs, including small carriers, may collocate equipment
     at incumbent LEC premises pursuant to section 251(c)(6). These
     standards provide that equipment is "*necessary* for
     interconnection or access to unbundled network elements" within the
     meaning of section 251(c)(6) if an inability to deploy that
     equipment would, as a practical, economic, or operational matter,
     preclude the requesting carrier from obtaining interconnection or
     access to unbundled network elements as contemplated in sections
     251(c)(2) and 251(c)(3). We also find that multifunction equipment
     meets the "necessary" standard only if the primary purpose and
     function of the equipment, as the requesting carrier seeks to
     deploy it, would be practically, economically, or operationally
     necessary for that carrier to obtain "equal in quality"
     interconnection or "nondiscriminatory access" to one or more
     unbundled network elements. We reject incumbent LEC and competitive
     LEC requests for alternative equipment standards because we believe
     such standards would be inconsistent with section 251(c)(6).[^295]
     We also find that standards more favorable to the incumbent LECs
     would thwart competition without significantly improving the
     interests of the incumbent LECs, while standards more favorable to
     competitive LECs would not properly take into consideration the
     property interests of the incumbent LECs. Therefore, we select the
     alternative that best balances the impact on each party, including
     small entities, and maximizes benefits.

130. We also conclude that switching and routing equipment generally
     meets our equipment standard because an inability to deploy that
     equipment would, as a practical, economic, and operational matter,
     preclude a requesting carrier from accessing all the features,
     functions, and capabilities of unbundled local loops. An incumbent
     LEC therefore generally must allow requesting carriers to collocate
     the relatively small switching and routing equipment that
     technological advances have enabled manufacturers to develop. An
     incumbent LEC, however, generally need not allow collocation of
     traditional circuit switches, which are very large pieces of
     equipment. We find, in light of the practical, economic, and
     operational availability of the relatively small switches and
     routers and the materially lesser burden collocation of these
     switches and routers imposes on an incumbent's property interests,
     that traditional circuit switches generally do not meet our
     equipment standard. We believe that this approach toward switching
     and routing equipment furthers the purposes behind the RFA, because
     it allows small competitive LECs flexibility in configuring their
     networks while precluding the collocation of switching and routing
     equipment that would infringe small incumbent LECs' property
     interests. We note that any alternative that might allow a small
     incumbent LEC to generally preclude the collocation of relatively
     small switches and routers within its premises would violate the
     statutory mandate that incumbent LECs, both large and small,
     provide for the collocation of "necessary" equipment.

131. In addition, in this *Order*, we eliminate the requirement that,
     pursuant to section 251(c)(6), an incumbent LEC allow competitive
     LECs to construct and maintain cross-connects outside of their
     immediate physical collocation space at the incumbent's premises.
     We considered maintaining this requirement, but that alternative
     would be inconsistent with the Communications Act and would not
     properly take into consideration the property interests of the
     incumbent LECs. The elimination of this requirement gives small
     incumbent LECs flexibility that was not available under the
     Commission's prior collocation rules.

132. We find that sections 201 and 251 of the Communications Act provide
     statutory authority to require an incumbent LEC to provision
     cross-connects between collocated carriers, and we require that an
     incumbent LEC provide such cross-connects upon reasonable request.
     We considered not requiring incumbent LECs to provision
     cross-connects between collocated carriers, but that alternative
     would allow incumbent LECs to provide collocation to competitive
     LECs in an unjust, unreasonable, and discriminatory manner. We note
     that all incumbent LECs, including those that are small carriers,
     cross-connect their own equipment within their premises. Indeed,
     those premises are, by design, places where a carrier can
     cross-connect equipment. The benefits to competition from requiring
     that a small incumbent LEC provision cross-connects between
     collocators within its premises far outweigh any additional burden
     such a requirement may impose on that carrier. In addition,
     allowing a small incumbent LEC to refrain from provisioning
     cross-connects between collocated carriers would allow the
     incumbent to impose unreasonable and discriminatory terms and
     conditions on collocators, in violation of the Communications Act.

133. In this *Order*, we eliminate the requirement that incumbent LECs
     allow the requesting carrier to select its physical collocation
     space from among the unused space in the incumbent's premises as
     well as requirements constraining how incumbents LEC may configure
     physical collocation space. We now allow incumbent LECs, in certain
     circumstances, to restrict physical collocation to space separated
     from space housing the incumbent's equipment and to require the
     construction and use of a separate entrance to access physical
     collocation space. We reject the alternative of retaining the prior
     rules, because they failed to properly balance the congressional
     goal of promoting competition against the need to protect an
     incumbent LEC's property interests against unwarranted intrusion.
     The elimination of these prior rules gives incumbent LECs,
     including small entities, flexibility that was not previously
     available.

134. We recognize, however, that an incumbent LEC has powerful
     incentives that, left unchecked, may influence it to allocate space
     in a manner inconsistent with its statutory duty to provide for
     physical collocation "on rates, terms, and conditions that are
     just, reasonable, and nondiscriminatory." Accordingly, we establish
     specific principles that each incumbent LEC, including those that
     are small carriers, must follow in assigning physical collocation
     space. These rules are designed to ensure that incumbent LECs, both
     large and small, act as neutral property owners and managers,
     rather than as direct competitors of the carriers requesting
     collocation, in assigning physical collocation space to requesting
     carriers. Alternatives that would give a small incumbent LEC more
     flexibility in assigning space might enable it to act unreasonably
     and discriminatorily in violation of section 251(c)(6). Those
     alternatives also would burden requesting carriers, including those
     that are small carriers, by increasing the costs they incur in
     competing against incumbent LECs. Therefore, for both statutory and
     public policy reasons, we do not adopt a different standard for
     incumbent LECs that are small entities.

135. We also reject the alternative of allowing incumbent LECs,
     including those that are small entities, to restrict physical
     collocation to space separated from space housing the incumbent's
     equipment and to require the construction and use of a separate
     entrance to access physical collocation space in all instances,
     because we find that such separation measures would be unreasonable
     and discriminatory in certain circumstances. We conclude, for
     example, that an incumbent LEC may require such separation measures
     only where legitimate security concerns, or operational constraints
     unrelated to the incumbent's or any of its affiliates' or
     subsidiaries' competitive concerns, warrant them. We note that this
     is consistent with the D.C. Circuit's recognition that alternatives
     other than separation are sufficient to address incumbent LECs'
     security concerns. To the extent small incumbent LECs encounter
     security concerns or operational constraints that differ from those
     incumbent LECs encounter, our rules permit small incumbent LECs to
     take those differences into account in their space assignment and
     configuration policies and practices.

## Report to Congress

136. The Commission will send a copy of the *Order*, including this
     FRFA, in a report to be sent to Congress pursuant to the
     SBREFA.[^296] In addition, the Commission will send a copy of the
     *Order*, including the FRFA, to the Chief Counsel for Advocacy of
     the SBA. A copy of the *Order* and the FRFA (or summaries thereof)
     will also be published in the Federal Register.[^297]

[^1]: 47 U.S.C. § 251(c)(6).

[^2]: These cables are referred to as cross-connections or
    cross-connects. We define cross-connects in paragraph 58, *infra*.

[^3]: Pub.L. 104-104, Title VII, 110 Stat. 153 (1996), *codified at* 47
    U.S.C. §§ 151 *et seq.* All citations in this Order to the 1996 Act
    are to the 1996 Act as codified in the United States Code. The 1996
    Act amended the Communications Act of 1934.

[^4]: *See*, *e.g.,* *Inquiry Concerning the Deployment of Advanced
    Telecommunications Capability to All Americans in a Reasonable and
    Timely Fashion, and Possible Steps to Accelerate Such Deployment
    Pursuant to Section 706 of the Telecommunications Act of 1996,
    Second Report*, CC Docket No. 98-146, 15 FCC Rcd 20913, 21004, para.
    246 (2000) (*Second Report on Advanced Telecommunications
    Capability*). In addition to facilities-based entry, the 1996 Act
    envisions competitive entry through purchase of unbundled network
    elements and resale. We note, in particular, that it may not be
    economically feasible for most carriers to compete for residential
    customers without substantial use of unbundled network elements, at
    least based on the costs associated with some current technologies.

[^5]: *See* Joint Commenters Reply at 5-6 (maintaining that Congress did
    not expect competitive LECs to replicate an incumbent's network).

[^6]: *See, e.g.,* Cisco Comments at 5 (arguing that collocation is the
    key to allowing competitive LECs to enter the market without
    replicating an incumbent's loop architecture); WorldCom Comments at
    5-6 (contending that Congress viewed collocation as fundamental to
    local competition); Focal Reply at 11-12.

[^7]: *See, e.g.,* Cisco Comments at 2; Lucent Reply at 2-3; Letter from
    Christine Mailloux, Regulatory Strategist, Copper Mountain Networks,
    Inc., to Magalie Roman Salas, Secretary, FCC, at 1 (filed Mar. 1,
    2001) (*Copper Mountain Mar. 1, 2001 Letter*); Letter from Richard
    S. Whitt, Directory/Senior Counsel, Internet/Data Law & Policy,
    WorldCom, to Magalie Roman Salas, Secretary, FCC, at 2 (filed Mar.
    23, 2001) (*WorldCom Mar. 23, 2001 Letter*).

[^8]: *Copper Mountain Mar. 1, 2001 Letter*, *supra* note Error:
    Reference source not found, at 1; *see also* DSLnet Comments at i;
    Aptonix Reply at 2-3; ATG Reply at i.

[^9]: ATG Comments, at Att. 1, p. 1, & Att. 2, p. 1.

[^10]: *See* Tachion Comments at 2-3; *Copper Mountain Mar. 1, 2001
    Letter*, *supra* note Error: Reference source not found, at 1-2.

[^11]: *See* Supra Comments at 5.

[^12]: *Deployment of Wireline Services Offering Advanced
    Telecommunications Capability*, CC Docket No. 98-147, Memorandum
    Opinion and Order and Notice of Proposed Rulemaking, 13 FCC Rcd
    24011, 24014, para. 2, & 24017, para. 11 (1998) (*Advanced Services
    Order)*, *recon. denied*, 15 FCC Rcd 17044 (2000).

[^13]: *See Joint Statement of Managers,* S. Conf. Rep. No. 104-230,
    104th Cong. 2d Sess. 1 (1996) (*Joint Explanatory Statement*).

[^14]: 47 U.S.C. § 251(c)(6). Each incumbent LEC has the duty "to
    provide, on rates, terms, and conditions that are just, reasonable,
    and nondiscriminatory, for physical collocation of equipment
    necessary for interconnection or access to unbundled network
    elements at the premises of the local exchange carrier, except that
    the carrier may provide for virtual collocation if the local
    exchange carrier demonstrates to the State commission that physical
    collocation is not practical for technical reasons or because of
    space limitations." *Id.* In a physical collocation arrangement, a
    competitor leases space at an incumbent LEC\'s premises for its
    equipment. The competing provider has physical access to this space
    to install, maintain, and repair its equipment. In a virtual
    collocation arrangement, the competitor designates the equipment to
    be placed at the incumbent LEC\'s premises. The competing provider,
    however, does not have physical access to the incumbent\'s premises.
    Instead, the equipment is under the physical control of the
    incumbent LEC, and the incumbent is responsible for installing,
    maintaining, and repairing equipment designated by the competing
    provider. *Deployment of Wireline Services Offering Advanced
    Telecommunications Capability*, CC Docket No. 98-147, *Order on
    Reconsideration and Second Further Notice of Proposed Rulemaking*,
    15 FCC Rcd 17806, 17812, para. 9 (2000) (*Collocation
    Reconsideration Order* or *Second Further Notice*), *petitions for
    further recon. pending*.

[^15]: *Implementation of the Local Competition Provisions in the
    Telecommunications Act of 1996*, First Report and Order, CC Docket
    No. 96‑98, 11 FCC Rcd 15499, 15782-807, paras. 555-607 (1996)
    (*Local Competition Order*), *aff\'d in part and vacated in part sub
    nom. Competitive Telecommunications Ass\'n v. FCC*, 117 F.3d 1068
    (8th Cir. 1997) & *Iowa* *Util. Bd. v. FCC*, 120 F.3d 753 (8th Cir.
    1997), *aff'd in part, rev'd in part, and remanded sub nom. AT&T
    Corp. v. Iowa Util. Bd*., 525 U.S. 366 (1999) (*AT&T v. Iowa Util.
    Bd*.), *aff'd in part and vacated in part on remand*, *Iowa* *Util.
    Bd. v. FCC*, 219 F.3d 744 (8th Cir. 2000), *cert. granted sub nom.
    Verizon Communications Corp. v. FCC*, 121 S.Ct. 877 (2001), *Order
    on Reconsideration*, 11 FCC Rcd 13042 (1996) (*Local Competition
    First Reconsideration Order*), *Second Order on Reconsideration*, 11
    FCC Rcd 19738 (1996) (*Local Competition Second Reconsideration
    Order*), *Third Order on Reconsideration and Further Notice of
    Proposed Rulemaking*, 12 FCC Rcd 12460 (1997) (*Local Competition
    Third Reconsideration Order*), *further recon. pending*.

[^16]: *Local Competition Order*, 11 FCC Rcd at 15783-84, para. 558.

[^17]: *Deployment of Wireline Services Offering Advanced
    Telecommunications Capability*, CC Docket No. 98-147, First Report
    and Order and Further Notice of Proposed Rulemaking, 14 FCC Rcd
    4761, 4773-74, paras. 23-24 (1999) (*Advanced Services First Report
    and Order), aff\'d in part, and vacated and remanded in part sub
    nom. GTE Service Corp. v. FCC*, 205 F.3d 416 (D.C. Cir. 2000) (*GTE
    v. FCC*), *on recon*., *Collocation Reconsideration Order*, 15 FCC
    Rcd at 17806-39, paras. 1-69.

[^18]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4784-86, paras. 41-43. In a shared physical collocation arrangement,
    two or more competitive LECs share caged collocation space pursuant
    to terms and conditions agreed to by the competitive LECs. *Id.* at
    4784, para. 41. In a caged physical arrangement, a competitive LEC
    leases and has direct physical access to caged space at an incumbent
    LEC structure for its equipment. Cageless physical collocation
    eliminates the cage surrounding the competitive LEC's equipment.
    *Id.* at 4784-85, para. 42.

[^19]: 47 C.F.R. § 51.323(k)(3). In adjacent physical collocation, the
    competitive LEC's equipment is located within a controlled
    environmental vault or similar structure that the competitive LEC or
    its contractor constructs on property leased from the incumbent LEC.
    *Advanced Services First Report and Order*, 14 FCC Rcd at 4786,
    para. 44.

[^20]: *Id.* at 4765, para. 8, & 4786-87, para. 45.

[^21]: *Id.* at 4773-74, paras. 23-24.

[^22]: *GTE v. FCC,* 205 F.3d at 420-27.

[^23]: *Id.* at 422-24.

[^24]: *Id*. at 423-24.

[^25]: *Id.* at 424-26.

[^26]: *Id*. at 421. Following the court's decision in *GTE v. FCC*, the
    Commission issued a *Second Further Notice* to invite comment on
    what actions the Commission should take in response to the remand.
    This Notice invited comment on, among other matters, the definition
    of "necessary" as used in section 251(c)(6), whether section
    251(c)(6) encompasses cross-connects between collocators, and what
    physical collocation requirements the Commission should adopt to
    replace those vacated by the court. *Second Further Notice*, 15 FCC
    Rcd at 17839-49, paras. 71-98.

[^27]: The D.C. Circuit affirmed some of the rules adopted in the
    *Advanced Services First Report and Order*. The court upheld rules
    requiring incumbent LECs to expand their collocation offerings to
    include cageless and adjacent collocation, and to allocate the costs
    of preparing space for collocation among potential collocators, as
    well as the rule precluding incumbent LECs from imposing
    unreasonable minimum space requirements on collocators. *See GTE v.
    FCC*, 205 F.3d at 420-27. This Order does not address or change in
    any way those collocation rules that the court upheld. Nor does it
    change the Commission's policy of encouraging the states to take an
    active role in resolving collocation disputes.

[^28]: We note that the statutory purpose of promoting competition,
    investment, and innovation is furthered through actions that enable
    both incumbent LECs and their competitors to compete in the
    provision of telecommunications services or to provide more
    innovative telecommunications services. In promoting these
    interests, we recognize that we must adopt rules that enable
    competition, investment, and innovation in furtherance of the
    public's interest, not rules that merely favor one type of
    competitor over another. *See generally* Disney Comments at 3
    (suggesting that the collocation rules should encourage deployment
    of as many broadband networks as possibly, as quickly as possible,
    in a competitive environment).

[^29]: 47 U.S.C. § 251(c)(6).

[^30]: *Local Competition Order*, 11 FCC Rcd at 15794-96, paras. 579-81.

[^31]: *Id.* at 15794, para. 580.

[^32]: *Id.* at 15794, para. 581.

[^33]: *Id.*

[^34]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4776-77, para. 28.

[^35]: *Id.*

[^36]: *Id.*

[^37]: *GTE v. FCC*, 205 F.3d at 422.

[^38]: *Id*. at 423.

[^39]: *Id.* at 421.

[^40]: *Id*. at 424.

[^41]: *Id*. (quoting *AT&T v. Iowa Util. Bd*., 525 U.S. at 390).

[^42]: 47 U.S.C. § 251(c)(6).

[^43]: *See, e.g.,* AT&T Comments at 9; Disney Comments at 5; Joint
    Commenters Comments at 18-19; Rhythms Comments at 3; *see also AT&T
    v. Iowa Utilities Bd.*, 525 U.S. at 397 (stating that the 1996 Act
    is "not a model of clarity").

[^44]: *GTE v. FCC*, 205 F.3d at 423; *accord* *McCulloch v. Maryland*,
    4 Wheat. 316, 414 (1819) (Marshall, C.J.) ("The word 'necessary' . .
    . has not a fixed character, peculiar to itself. . . . A thing may
    be necessary, very necessary, absolutely or indispensably
    necessary."); *Milligan v. City of Red Oak, Iowa*, 230 F.3d 355, 359
    (8^th^ Cir. 2000) (*per curiam*) (under Iowa law, the test for
    determining whether a taking is "necessary" is whether the
    condemning authority can reasonably expect to achieve its public
    purpose); *Montana Power Co. v. Burlington Northern R.R. Co.*, 900
    P.2d 888, 891 (Mont. 1995) ("necessary" means "reasonable,
    requisite, and proper for the accomplishment of the end in view");
    *see also MCI Telecommunications Corp. v. American Telephone and
    Telegraph Co.*, 512 U.S. 218, 226 (1994) ("required" can mean either
    "demanded as essential" or "demanded as appropriate") (internal
    quotation marks omitted).

[^45]: The legislative history makes clear that Congress intended to
    provide explicit statutory authorization for physical collocation,
    but does not define "necessary" or otherwise directly address what
    equipment an incumbent LEC must allow a requesting carrier to
    collocate. *See, e.g.,* *Joint Explanatory Statement*¸ *supra* note
    Error: Reference source not found, at 117-28; H. Rep. No.
    104-204(1), 104th Cong., 1st Sess., 4 & 73 (1995) (*1995 House
    Report*); S. Rep. No. 104-23, 104th Cong., 1st Sess., 19-22 & 92
    (1995) (*1995 Senate Report*); *compare Bell Atlantic Telephone Cos.
    v. FCC*, 24 F.3d 1441 (D.C. Cir. 1994) (*Bell Atlantic I*) (holding
    that the Communications Act of 1934 did not authorize the Commission
    to require LECs to permit physical collocation of their property)
    *with* 140 Cong. Rec. H5216, 5230 (June 28, 1994) (statements of
    Rep. Markey) (stating 18 days after the decision in *Bell Atlantic
    I* that without an explicit physical collocation provision, the
    Commission will "lack\[\] the tools needed to pave a high quality
    and affordable information superhighway").

[^46]: *See Bell Atlantic Tel. Cos. v. FCC*, 131 F.3d 1044, 1047 (D.C.
    Cir. 1997) (*Bell Atlantic II*); *Advanced Services Order*, 13 FCC
    Rcd 24045, para. 71; CTSI Comments at 7 (to properly interpret
    section 251(c)(6), the Commission should read statute in its
    entirety and in light of Congress' objectives).

[^47]: *GTE v. FCC*, 205 F.3d at 423; *see AT&T v. Iowa Util. Bd*., 525
    U.S. at 388 (in determining the meaning of "necessary" under section
    251(d)(2)(A), the Commission must "apply some limiting standard,
    rationally related to the goals of the Act").

[^48]: 47 U.S.C. § 251(d)(2)(A) (emphasis added).

[^49]: *AT&T v. Iowa Util. Bd*., 525 U.S. at 388; *GTE v. FCC*, 205 F.3d
    at 423.

[^50]: *See* Cisco Comments at 5-6; Supra Comments at 11; *see also* GSA
    Comments at 5-6 (arguing that a definition of "necessary" in section
    251(c)(6) similar to that adopted for section 251(d)(2)(A) would
    appropriately ensure that a competitive LEC will not be required to
    implement impractical solutions, employ uneconomic network
    configurations, or breach reasonable operational constraints).

[^51]: *Implementation of the Local Competition Provisions of the
    Telecommunications Act of 1996*, Third Report and Order and Fourth
    Further Notice of Proposed Rulemaking, 15 FCC Rcd 3696, 3721, at
    para. 44 (1999) (emphasis in original & subsequent history omitted)
    (*UNE Remand Order*).

[^52]: *See* part IV.B.5, *infra* (addressing switching and routing
    equipment).

[^53]: *See* part IV.B.3, *infra*.

[^54]: *See, e.g.,* Rhythms Comments at 13; Letter from Scott P.
    Anderson, Manager, Regulatory Affairs & Industry Relations,
    Broadslate Networks, to Magalie Roman Salas, Secretary, FCC, at 3-9
    (filed Mar. 14, 2001) (*Broadslate Mar. 14, 2001 Letter*).

[^55]: *See, e.g.,* DSLnet Comments at 31 (arguing that any commercially
    available equipment that enables interconnection or access to
    unbundled network elements meets the "necessary" standard);
    Intraspan Comments at 7 (proposing that the marketplace should
    determine which equipment is "necessary"); NAS Comments at 2-6
    (urging readoption of the "used or useful" standard).

[^56]: *See*, *e.g.,* Conectiv Comments at iii; Telergy Comments at 3;
    SBC Comments at 14; Verizon Comments at 4-5.

[^57]: *See, e.g.,* Corecomm Comments at 20; CTSI Comments at 6; Supra
    Comments at 10. An incumbent LEC, however, may use its premises for
    activities other than interconnecting or accessing the different
    parts of its network. The equipment an incumbent deploys within its
    premises therefore bears no intrinsic relationship to "equipment
    necessary for interconnection or access to unbundled network
    elements" in section 251(c)(6). *See* SBC Reply at 10-11; Verizon
    Reply at 6-8. Similarly, authorizing the collocation of any
    telecommunications-related equipment whose deployment would
    facilitate a competitive LEC's ability to compete, as Focal
    proposes, would give requesting carriers virtually unlimited access
    to an incumbent's property irrespective of any relationship between
    the equipment sought to be collocated and the collocator's ability
    to interconnect and access unbundled network elements. *See* Focal
    Comments at 3.

[^58]: *See* SBC Reply at 5-10.

[^59]: *See, e.g.,* Joint Commenters Comments at 20-23; Qwest Comments
    at 3-4; Verizon Comments at 2-3; *see also* Comptel Comments at 4
    (arguing that the Commission should focus on whether collocating
    equipment having a particular function makes the competitive LEC
    materially more efficient than if the function were provided from
    elsewhere). *But see* Telergy Comments at 14 (pointing out that
    collocation is not absolutely required for interconnection or access
    to unbundled network elements because alternatives, such a
    meet-point interconnection, are available); ATG Reply at 4 (same).

[^60]: Letter from Frank S. Simone, Government Affairs Director, AT&T,
    to Magalie Roman Salas, Secretary, FCC, at Att., p. 7 (filed Apr. 5,
    2001) (*AT&T Apr. 5, 2001 Letter*) (stating that the plain terms of
    section 251(c)(6) focus not on whether equipment needs to be
    collocated. but simply on whether it is needed, broadly speaking,
    for interconnection or access to unbundled network elements).

[^61]: 47 U.S.C. § 251(c)(6) (emphasis added).

[^62]: *Id.*

[^63]: Section 251(c)(6) provides for "virtual collocation if the
    \[incumbent\] local exchange carrier demonstrates to the State
    commission that physical collocation is not practical for technical
    reasons or because of space limitations." 47 U.S.C. § 251(c)(6).

[^64]: In note Error: Reference source not found, *supra*¸ we define
    physical and virtual collocation.

[^65]: *See, e.g.,* *1995 House Report*, *supra* note Error: Reference
    source not found, at 73 (stating that the "risk of discriminatory
    interconnection grows the farther one gets away from the central
    office" and that "for this reason, the legislation mandates actual,
    or physical, collocation," except where physical collocation is
    impractical).

[^66]: 47 U.S.C. § 251(c)(6).

[^67]: *See, e.g.,* AT&T Comments at 11-13; Joint Commenters Reply at
    8-9; RCN Comments at 7; Telergy Comments at 16-17; Focal Reply at 9;
    *see also Bell Atlantic II*, 131 F.3d at 1047 (stating that
    "\[c\]ontext serves an especially important role in textual analysis
    of a statute when Congress has not expressed itself as unequivocally
    as might be wished"). *But see* SBC Reply at 7-9 (arguing, in
    effect, that an incumbent need not allow collocation of equipment
    "necessary" to achieve interconnection equal in quality to that
    which the incumbent provides itself or to access all the features,
    functions, and capabilities of an unbundled network element).

[^68]: *See WorldCom, Inc. v. FCC*, 246 F.3d 690, 694 (D.C. Cir. 2001)
    (noting relationship between collocation obligations and obligations
    under sections 251(c)(2) and 251(c)(3)); Corecomm Comments at 13;
    RCN Comments at 7.

[^69]: *E.g.*, RCN Comments at 7; Joint Commenters Reply at 8-9;

[^70]: 47 U.S.C. § 251(c)(2).

[^71]: 47 U.S.C. § 251(c)(2)(C)-(D).

[^72]: 47 U.S.C. § 251(c)(3).

[^73]: 47 C.F.R. § 51.307(c); *see, e.g.,* *UNE Remand Order*, 15 FCC
    Rcd at 3772-73, para. 167 (defining an unbundled local loop as
    including all the features, functions, and capabilities of the
    transmission facilities between an incumbent LEC\'s central office
    and the loop demarcation point at the customer premises); *see also*
    DSLnet Comments at 28-29 (arguing that a requesting carrier must be
    able to employ equipment that can interact with the features,
    functions, and capabilities of unbundled network elements).

[^74]: *E.g.*, AT&T Comments at 13; Joint Commenters Comments at 24-26;
    RCN Comments at 7.

[^75]: *E.g.*, DSLnet Comments at 28; Telergy Comments at 3.

[^76]: *See, e.g.,* AT&T Comments at 12; Joint Commenters Comments at
    24-26; RCN Comments at 7.

[^77]: *Local Competition Order*, 11 FCC Rcd at 15614-15, para. 224;
    *cf. Iowa* *Util. Bd. v. FCC*, 219 F.3d at 757 (finding it
    "self-evident that the Act prevents an \[incumbent LEC\] from
    discriminating between itself and a requesting competitor with
    respect to the quality of the interconnection provided").

[^78]: *See* Cisco Comments at 9 (in the context of modern technology,
    quality of service functions are critical to an ability to
    interconnect); *WorldCom Mar. 23, 2001 Letter*, *supra* note Error:
    Reference source not found, at 2 (interconnection encompasses the
    ability to move traffic intelligently from point to point). Thus,
    for instance, if a link in the incumbent's network is able to
    accommodate traffic with a particular throughput rate and quality of
    service, a carrier that requests and pays for a similar link must
    have the opportunity to transmit traffic through the interconnection
    with the same throughput rate and quality of service. *See
    generally* AT&T Comments at Att. 2 (Frontera Declaration), pp. 9-13.

[^79]: *See AT&T v. Iowa Util. Bd*., 525 U.S. at 387.

[^80]: 47 U.S.C. § 153(29); *see AT&T v. Iowa Util. Bd*., 525 U.S. at
    387 (holding that vertical switching features, such as call
    forwarding and call waiting, are functions that that "fall squarely
    within the statutory definition" of network element).

[^81]: *See* Telergy Comments at 16-17; AT&T Reply at 12; *AT&T Apr. 5,
    2001 Letter*, *supra* note Error: Reference source not found, at
    Att., pp. 4-5.

[^82]: *See, e.g.,* \@link Comments at 20 (arguing that access to the
    features, functions, and capabilities of a unbundled network element
    is part of access to the unbundled network element); Conectiv
    Comments at 9 (maintaining that in order to access unbundled network
    elements effectively and on the same basis as incumbents,
    competitive LECs must deploy equipment fully capable of interacting
    with the elements' features, functions, and capabilities); DSLnet
    Comments at 28-29; AT&T Reply at 12.

[^83]: *See* SBC Reply at 7.

[^84]: 47 U.S.C. § 153(29); *see generally AT&T v. Iowa Util. Bd*., 525
    U.S. at 387.

[^85]: *See, e.g.,* AT&T Comments at 12; Telergy Comments at 3-4 (for
    access to an unbundled network element to be meaningful, a
    requesting carrier must be able to take advantage of all the
    element's feature, functions, and capabilities); *AT&T Apr. 5, 2001
    Letter*, *supra* note Error: Reference source not found, at Att., p.
    5; Letter from Cristin L. Flynn, Associate Policy Counsel,
    Internet/Data Law & Policy, WorldCom, to Magalie Roman Salas,
    Secretary, FCC, at Att., p. 5 (filed Mar. 12, 2001) (*WorldCom Mar.
    12, 2001 Letter*).

[^86]: For convenience, we refer to these functions as "necessary"
    functions and "additional" functions.

[^87]: *GTE v. FCC*, 205 F.3d at 421; *see* SBC Comments at 12; Letter
    from Priscilla Hill-Ardoin, Senior Vice-President, SBC, to Magalie
    Roman Salas, Secretary, FCC, at Att. (filed May 23, 2001) (*SBC May
    23, 2001 Letter*).

[^88]: *E.g.*¸ Joint Commenters Comments at 21; Supra Comments at 10.

[^89]: Letter from Teresa Marrero, Senior Attorney, AT&T, to Magalie
    Roman Salas, Secretary, FCC, at 4 (filed Feb. 21, 2001) (*AT&T Feb.
    21, 2001 Letter*); *WorldCom Mar. 23, 2001 Letter*, *supra* note
    Error: Reference source not found, at 5.

[^90]: *See, e.g.,* ATG Comments at 2 (precluding collocation and use of
    multi-functional equipment would severely hinder the emergence of
    telecommunications competition); Rhythms Comments at 16-18; Joint
    Commenters Reply at 12-13; Network Telephone Reply at 4 (Congress
    did not intend to deny competitive providers the benefits of
    efficient, technologically advanced equipment); *WorldCom Mar. 23,
    2001 Letter*, *supra* note Error: Reference source not found, at 2
    (competitive LECs that cannot collocate multi-functional equipment
    will be about as useful as telephone switch operators -- unable to
    compete in today's marketplace).

[^91]: *See, e.g.,* Rhythms Comments at 13-15; Tachion Comments at 2-3.

[^92]: *GTE v. FCC*, 205 F.3d at 423; *see,* *e.g.,* Telergy Comments at
    16; RCN Comments at ii; Rhythms Comments at 4-5; Qwest Reply at 2-3.

[^93]: *See GTE v. FCC*, 205 F.3d at 423-24; Qwest Reply at 2-3; Letter
    from Frank S. Simone, Government Affairs Director, AT&T, to Magalie
    Roman Salas, Secretary, FCC, at 1 (filed Apr. 20, 2001) (*AT&T Apr.
    20, 2001 Letter*). *But* *see* SBC Comments at 10-14 (arguing that
    court has determined that the Commission cannot under any
    circumstances require that an incumbent permit collocation of
    multi-functional equipment); Verizon Comments at 6-8.

[^94]: Qwest Comments at 3-4; *see, e.g.,* Rhythms Reply at 2-3; Joint
    Commenters Reply at 5-6; Letter from Robert B. McKenna, Associate
    General Counsel, Qwest, to Magalie Roman Salas, Secretary, FCC, at
    Att., p.1 (filed Mar. 5, 2001) (*Mpower and Qwest Mar. 5, 2001
    Letter*); *WorldCom Mar. 23, 2001 Letter*, *supra* note Error:
    Reference source not found, at 3.

[^95]: Qwest Comments at iii.

[^96]: *See* Qwest Comments at 5; Gluon Comments at 4; *WorldCom Mar.
    23, 2001 Letter*, *supra* note Error: Reference source not found, at
    3.

[^97]: *See* paras. 28-29, *supra*.

[^98]: *See* Qwest Comments at 5; Gluon Comments at 4; *WorldCom Mar.
    23, 2001 Letter*, *supra* note Error: Reference source not found, at
    3.

[^99]: *See* ATG Comment at 3 (indicating that any additional function
    of collocated equipment that ATG might use are "inextricably
    intertwined with the primary use of the equipment such that the
    function cannot be removed").

[^100]: *See* WorldCom Comments at 9.

[^101]: *See GTE v. FCC*, 205 F.3d at 424; *see* NAS Comments at 5
    (noting that manufacturers have no operational, economic, or
    technical incentive to integrate payroll and data collection into
    multi-functional equipment); *WorldCom Mar. 23, 2001 Letter*,
    *supra* note Error: Reference source not found, at 3.

[^102]: *See* AT&T Comments at 18 (section 251(c)(6) requires incumbents
    to permit collocation of multi-functional equipment if the
    additional functions do not cause the equipment to consume
    appreciably more space than "single-use" equipment); *WorldCom Mar.
    23, 2001 Letter*, *supra* note Error: Reference source not found, at
    3 (contending that the Commission could avoid any conceivable
    "takings" concerns by requiring that multi-functional equipment
    cannot occupy more space than similar equipment that provides only
    the interconnection and access functionality); *Salvaty v. Falcon
    Cable Television*, 165 Cal. App. 3d 798, 803, 212 Cal. Rptr. 31, 35
    (Cal. Ct. App. 1985) (*Salvaty v. Falcon Cable*) (attachment of
    television cable held within the scope of easement permitting
    placement of poles with telephone and electrical wires on private
    property because "the addition of cable television equipment to a
    preexisting utility pole \[did not\] materially increase burden on
    \[that\] property); *accord* Joint Commenters Reply at 13 (arguing
    that incumbent LECs have not explained how using the additional
    functions of multi-functional equipment would constitute a greater
    taking than collocation of that equipment); *see also C/R TV, Inc.
    v. Shannondale, Inc.*, 27 F.3d 104, 107-08 (4^th^ Cir. 1994) (*C/R
    TV v. Shannondale*) (examining whether proposed use would
    "substantially burden" private property as part of determination
    whether attaching television cable to poles falls within easement
    for the installation and maintenance of poles having telephone and
    electrical wires attached).

[^103]: A difference in the demands on an incumbent's space would be
    insignificant if the incumbent did not have to reconfigure the outer
    boundary of a carrier's collocation space in order to accommodate
    the additional functions. A difference in the demands on an
    incumbent's other resources would be insignificant if the demands on
    those resources as a result of the additional functions were roughly
    comparably to (or less than) the levels that would prevail if those
    functions were excluded from the equipment or not activated. Thus,
    the incumbent's property interests would not be burdened simply
    because the requested equipment is somewhat taller, wider, or
    heavier, requires marginally more power, produces marginally more
    heat, or requires some additional maintenance or repair than
    alternative equipment excluding those functions.

[^104]: *See* AT&T Comments at 18-19; CompTel Reply at 4 (asserting that
    incumbents that are truly concerned about space considerations would
    not seek to foreclose collocation of all multi-functional
    equipment); Qwest Reply at 4-5 (characterizing as "not well-founded"
    the suggestion that collocation of multi-functional equipment will
    necessarily lead to a taking of more incumbent LEC space than the
    Communication Act authorizes); *see also Salvaty v. Falcon Cable*,
    165 Cal. App. 3d at 803, 212 Cal. Rptr. at 35; *C/R TV v.
    Shannondale*, 27 F.3d at 107-08. *But see* Letter from Michael K.
    Kellogg, Counsel for SBC, to Magalie Roman Salas, Secretary, FCC, at
    3-4 (filed Feb. 1, 2001) (*SBC Feb. 1, 2001 Letter*) (arguing that
    statute limits scope of authorized collocation by reference to
    equipment's functions and that collocation of additional functions
    would impermissibly take incumbent LEC property).

[^105]: \@tlink Comments at 24-25; Nortel Comments at 5 (with today's
    technology, single-function equipment is unlikely to be small or
    consume less space than multi-functional equipment).

[^106]: *See, e.g.,* Rhythms Comments at 13-14.

[^107]: ATG Comments at 4 (contending that collocation of innovative
    equipment reduces the imposition on an incumbent's property
    interests that a collocator causes) & Att. 1, p. 1 (asserting that
    the multifunctional equipment now being developed conforms to
    accepted compliance standards for space, power, and heat
    dissipation).

[^108]: BellSouth Comments at 5; SBC Comments at 10-11; Verizon Comments
    at 6.

[^109]: *See* Florida Commission Comments at 3 (arguing that it would be
    unreasonable to conclude that a specific type of equipment may be
    collocated only if its sole purpose interconnection or access to
    unbundled network elements); Tachion Comments at 4 (artificially
    "dis-integrating" technology or precluding new entrants from using
    available functions in collocated equipment would create an enormous
    barrier to competition).

[^110]: *See SBC Feb. 1, 2001 Letter*, *supra* note Error: Reference
    source not found, at 3.

[^111]: *See*, *e.g.*, 47 U.S.C. § 153(29) (definition of network
    element).

[^112]: *See* para. 20, *supra*.

[^113]: *See generally* RCN Comments at 14 (maintaining that precluding
    collocation of multi-functional equipment would thwart competition).

[^114]: *See, e.g.,* Cisco Comments at 11 (observing that limiting the
    functions that qualify for collocation would place additional
    burdens on an incumbent's space and other resources); Florida
    Commission Comments 3 (contending that it is appropriate to consider
    breath of multi-functional equipment and it use for interconnection
    or access to unbundled network elements relative to other purposes);
    Gluon Comments at 3 (asserting that market-opening provisions of
    1996 Act would have no point if restrictive equipment functionality
    were to create artificial barriers to entry); NAS Comments at 6
    (contending that precluding collocation of multi-functional
    equipment would stifle technological innovation); ATG Reply at 3-4;
    Letter from Christine Mailloux, Regulatory Strategist, Copper
    Mountain, to Magalie Roman Salas, Secretary, FCC, at 3 (filed May
    23, 2001) (*Copper Mountain May 23, 2001 Letter*) (maintaining that
    overly rigid collocation rules would discourage innovation and
    widespread deployment of affordable broadband services).

[^115]: *See, e.g.,* Connectiv Comments at 12 (arguing that incumbent
    LECs should be required to allow collocation of any multi-functional
    equipment that contains features or functions that enable
    interconnection or access to unbundled network elements); Covad
    Comments at 16 (proposing that a requesting carrier be able
    collocate any equipment that performs a function necessary for
    interconnection or access to unbundled network elements); Focal
    Comments at 12-13 (proposing that a requesting carrier be able to
    collocate any multi-functional equipment that, as a technical
    matter, may feasibly be deployed at the incumbent's premises if
    deployment would facilitate the requesting carrier's ability to
    compete).

[^116]: *See GTE v. FCC*, 205 F.3d at 424; *see also AT&T v. Iowa Util.
    Bd*., 525 U.S. at 389-90.

[^117]: *E.g.*, AT&T Comments at 20-24; ATG Comments at 2-3 & Att. 1,
    pp. 2-3; Joint Commenters Comments at 28-29; Northpoint Comments at
    3-4; Sprint Comments at 5-7.

[^118]: *E.g.*, AT&T Comments at 20-23 (transmission equipment,
    including DSLAMs); ATG Comments at 3 & Att. 1, pp. 2-3
    (concentrators, transport equipment, cross-connect systems,
    multiplexers, DSLAMs, and power distribution equipment); Joint
    Commenters Comments at 28-29 (transmission equipment, including
    optical terminating equipment, concentrators, multiplexers); MFN
    Comments at 13-14 (fiber distribution frames); NAS Comments at 8-14
    (arguing that competitive LECs cannot, as a practical, economic, or
    operational matter, provide digital subscriber line (DSL) service
    without DSLAMs and ATM equipment); Northpoint Comments at 5-8
    (aggregation devices and DSLAMs); Verizon Comments at 7 (classifying
    as "necessary" multiplexers, concentrators, and DSLAMs used in
    connection with DSL services); Sprint Comments at 8-9 (ATM
    multiplexers, DSLAMs, fiber optic terminating equipment, and
    cross-connect panels); Winstar Comments at 1-6 (microwave
    transmission facilities).

[^119]: *E.g.*, Sprint Comments at 9.

[^120]: Cisco Comments at 7.

[^121]: *See*, *e.g.*, Gluon Comments at 3-4 (maintaining that
    requesting carriers should be able to add equipment management
    software to collocated equipment); Sprint Comments at 8-9 (referring
    to network management devices, testing equipment, portable testing
    equipment, test heads, surveillance equipment, fuse and alarm
    panels, timing sources, and cabinets for spares); WorldCom Reply at
    8-9 (indicating that absent the ability to collocate remote
    surveillance and telemetry equipment, a carrier could not
    practicably assure the integrity or proper operation of collocated
    equipment).

[^122]: *Compare*, *e.g.*¸ Sprint Comments at 8-9 (proposing "safe
    harbor" list of equipment) *with* Letter from Richard Juhnke,
    General Attorney, Sprint, to Magalie Roman Salas, Secretary, FCC, at
    Att., p. 1 (filed Apr. 26, 2001) (*Sprint Apr. 26, 2001 Letter*)
    (stating that incumbents have not resisted collocation of equipment
    on proposed "safe harbor" list). *But see* SBC Reply at 17-21
    (arguing that some of the equipment listed by Sprint falls outside
    SBC's proposed definition of "necessary").

[^123]: *See* AT&T Comments at 20 (observing that the Commission cannot
    possibly, in the face of rapidly changing technology, determine in
    advance whether each type of equipment qualifies for collocation).

[^124]: Letter from Kathleen, M. Marshall, Executive Director, ATG, to
    William A. Kehoe III, Special Counsel, FCC, at 2 (filed Feb. 25,
    2001) (*ATG Feb. 25, 2001 Letter*).

[^125]: *See* Letter from W. Scott Randolph, Director -- Regulatory
    Affairs, Verizon, to Magalie Roman Salas, Secretary, FCC, at Att.,
    p. 5 (filed May 25, 2001) (*Verizon May 25, 2001 Letter*).

[^126]: As explained below, application of our equipment standard may
    allow for certain specific types of switches or routers, but not
    others. *See* paras. 46-48, *infra*.

[^127]: *UNE Remand Order*, 15 FCC Rcd at 3772-73, para. 167; *see* 47
    C.F.R. § 51.307(c).

[^128]: *Cf.* 47 U.S.C. § 153(43) (defining "telecommunications").

[^129]: *See, e.g.*, Qwest Comments at 13-14; Sprint Comments at 8;
    Verizon Comments at 7.

[^130]: *See* 47 U.S.C. §§ 153(43), 153(45) (defining
    "telecommunications" and "telecommunications service").

[^131]: See paragraph 53, *infra*, for examples of functions that
    carriers may not collocate under our equipment standard.

[^132]: *See* para. 23, *supra*.

[^133]: *E.g.,* Corecomm Comments at 27; Nortel Comments at 2-3. This
    equipment includes remote switching modules, which are small
    switches that are used in conjunction with host switches located in
    different premises. *E.g.*, AT&T Comments at 25 & Att. 2 (Culmone
    Declaration), pp. 11-12.

[^134]: *E.g.*, Corecomm Comments at 27 (stating that a traditional
    circuit switch requires hundreds of square feet of floor space,
    while several modern switches or routers can fit comfortably within
    the space of a typical collocation area).

[^135]: Corecomm Comments at 27; DSLnet Comments at 32; Telergy Comments
    at 28.

[^136]: *See* paras. 21-23, *supra*; SBC Comments at 14; Verizon Reply
    at 2-3; *SBC May 23, 2001 Letter*, *supra* note Error: Reference
    source not found, at Att.; *see also* AT&T Reply at 34.

[^137]: We note that the record indicates that equipment housing newer,
    packet-based switching and routing technology generally is
    dramatically smaller than traditional, circuit switches and
    continues to evolve through the use of even smaller components.
    *See*, *e.g.*, AT&T Comments at 25-26; Cisco Comments at 7; Tachion
    Comments at 2; AT&T Reply at 23. To the extent this trend does not
    continue in the future and, instead, the size of switching and
    routing equipment begins to significantly increase, we may need to
    revisit our finding.

[^138]: *See Advanced Services First Report and Order*, 14 FCC Rcd at
    4778-79, para. 31; *Local Competition Order*, 11 FCC Rcd at 15794,
    para. 581.

[^139]: *Local Competition Order*, 11 FCC Rcd at 15795, para. 581.

[^140]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4778-79, para. 31.

[^141]: *See* Cisco Comments at 7 (noting that the treatment of
    switching in the *Local Competition Order* focused solely on
    interconnection for circuit-switched technologies); Corecomm
    Comments at 22 (pointing out that the Commission has never found
    that switches do not perform interconnection or network access
    functions).

[^142]: *See*, *e.g.*, *Copper Mountain Mar. 1, 2001 Letter*, *supra*
    note Error: Reference source not found, at 1-2; Gluon Comments at
    2-3; AT&T Comments at 24-32.

[^143]: *See generally* Telergy Comments at 28-29 (arguing that we must
    periodically review our collocation rules in light of technological
    developments); Letter from Frank S. Simone, Government Affairs
    Director, AT&T, to Magalie Roman Salas, Secretary, FCC, at Att. 2
    (Physical Collocation White Paper), p. 5 (filed Dec. 12, 2001)
    (*AT&T Dec. 12, 2001 Letter*) (maintaining that the Commission is
    entitled, if not obligated, to reassess whether it can require that
    incumbents permit collocation of switching equipment).

[^144]: *See generally ATG Feb. 25, 2001 Letter*, *supra* note Error:
    Reference source not found, at 3-4; *ATG Feb. 25, 2001 Letter*,
    *supra* note Error: Reference source not found, at 3-4. We note that
    as network architectures and equipment offerings evolve, additional
    types of equipment may become "necessary" to obtaining "equal in
    quality" interconnection or "nondiscriminatory" access to unbundled
    network elements. We do not preclude a requesting carrier from
    asserting that any particular telecommunications-related function
    meets our equipment standard.

[^145]: *Local Competition Order*, 11 FCC Rcd at 15801-02, para. 594-95.
    This rule was never directly challenged on appeal. *See generally
    Iowa Util. Bd. v. FCC*, 120 F.3d at 818 (finding the Commission's
    rules and policies regarding an incumbent LEC's duty to provide
    physical collocation to be consistent with section 251(c)(6)).

[^146]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4779-80, para. 33.

[^147]: *GTE v. FCC*, 205 F.3d at 423-24 (vacating and remanding
    "offending portions" of the *Advanced Services First Report and
    Order*).

[^148]: *Id. at* 423.

[^149]: *Id.*

[^150]: *Second Further Notice*, 15 FCC Rcd at 17846, para. 88.

[^151]: *Id.* at 17847, para. 91.

[^152]: *Id.* at 17846, para. 89.

[^153]: John Vacca, The Cabling Handbook, 151 (Prentice Hall 1998). As
    used in this definition, a cabling run includes dark fiber; *see
    also* Newton's Telecom Dictionary, 206 (15^th^ ed. 1999) (a
    cross-connection or cross-connect is "\[a\] connection scheme
    between cabling runs, subsystems, and equipment using patch cords or
    jumpers that attach to connecting hardware on each end"); *see also
    UNE Remand Order*, 15 FCC Rcd at 3778, n.332.

[^154]: *See* *Local Competition Order*, 11 FCC Rcd at 15801-02, para.
    594.

[^155]: As used in this Order, "common areas" refers to areas on an
    incumbent LEC's premises outside of a physical collocator's
    immediate collocation space. Many common areas contain facilities or
    equipment serving multiple carriers.

[^156]: We note that on March 15, 2001, the Coalition of Competitive
    Fiber Providers filed a petition for a declaratory ruling seeking
    pursuant to sections 224(f)(1) and 251(b)(4) of the Communications
    Act, 47 U.S.C. §§ 224(f)(1), 251(b)(4), that incumbent LECs must
    provide to telecommunications carriers non-discriminatory access to
    any duct, conduit, or right-of-way owned or controlled by an
    incumbent and leading to, or located in the incumbent's central
    office. This Order does not address that petition or otherwise
    determine any entity's rights and obligations under section 224.

[^157]: We note that prior to the D.C. Circuit's decision in *GTE v.
    FCC*¸ the Commission viewed cross-connects between a collocator and
    another carrier (*i.e.*, either the incumbent or another collocator)
    as a means of connecting the collocator's equipment to the other
    carrier's network. *See UNE Remand Order*¸ 15 FCC Rcd at 3778, para.
    179; *Local Competition Order*¸ 11 FCC Rcd at 15801-02, para. 594.
    However, as the D.C. Circuit implicitly recognized, a collocator
    that installs a cross-connect cable or wire in an incumbent LEC
    premises is physically collocating that cable or wire. *See GTE v.
    FCC*, 205 F.3d at 423.

[^158]: *Id.* at 423-24. An incumbent LEC, of course, must permit a
    competitive LEC to cross-connect cables and equipment within the
    competitive LEC's own physical collocation space. To find otherwise
    would render section 251(c)(6) meaningless. In addition, although we
    find no statutory support for requiring that an incumbent LEC permit
    competitive LEC-provisioned cross-connects outside of their physical
    collocation space, we believe that competitive LEC provisioning of
    cross-connects imposes a much lesser burden on the incumbent's
    property in certain circumstances, such as when the carriers being
    cross-connected occupy immediately adjacent collocation space, than
    when the cross-connects would traverse common areas of the incumbent
    LEC's premises. Therefore, we encourage incumbent LECs to adopt
    flexible cross-connect policies that would not prohibit competitive
    LEC-provisioned cross-connects in all instances.

[^159]: *Bell Atlantic Telephone Cos. v. FCC*, 24 F.3d 1441, 1446 (D.C.
    Cir. 1994) (*Bell Atlantic I*); SBC Reply at 27.

[^160]: *See, e.g.,* Qwest Reply at 6; Focal Comments at 18-20; Joint
    Commenters Comments at 53-55; Letter from Richard Juhnke, General
    Attorney, Sprint, to Magalie Roman Salas, Secretary, FCC, CC Docket
    Nos. 98-147 and 96-98 at 1-2 (filed May 10, 2001) (*Sprint May 10,
    2001 Letter*); *see also* Northpoint Comments at 11-13. We note that
    the court in *GTE v. FCC*, 205 F 3d. 416 (D.C. Cir. 2000) did not
    have before it the question of whether the Commission could require
    an incumbent LEC to provide such cross-connects pursuant to its
    authority under section 201 of the Communications Act.

[^161]: *See*, *e.g.,* Focal Comments at 18 (asserting that section
    201(a) requires common carriers to furnish telecommunications
    services upon reasonable request).

[^162]: 47 U.S.C. § 201(a). Section 201(a) also "authorizes the
    Commission, where necessary or desirable in the public interest, to
    order common carriers to establish physical connections with other
    carriers, whether or not the common carriers might choose to do so
    voluntarily." *See Expanded Interconnection with Local Telephone
    Facilities*, 9 FCC Rcd 5154, 5161-62, para. 18 (1994) (*Virtual
    Collocation Order*), *remanded for consideration of 1996 Act sub
    nom. Pacific Bell. v. FCC*, 81 F.3d 1147 (D.C. Cir. 1996).

[^163]: 47 U.S.C. § 201(a).

[^164]: *See, e.g*., Mpower Comments at 27.

[^165]: *See, e.g*., AT&T Comments at 33-34.

[^166]: *See, e.g.,* WorldCom Comments at 11. "A communications channel
    is back hauling when it takes traffic beyond its destination and
    back." Newton's Telecom Dictionary, 84 (15^th^ ed. 1999).

[^167]: *See, e.g.,* Focal Comments at 17 (arguing that it would be
    prohibitively expensive for competitive LECs to pull fiber through
    manholes and the streets at substantial costs in order to utilize a
    carrier other than the incumbent LEC for interoffice transport).

[^168]: *See* WorldCom Comments at 11.

[^169]: The Commission has long recognized the importance of a
    competitive transport market. In fact, over the last decade, the
    Commission has adopted specific rules in its *Expanded
    Interconnection Proceeding* to facilitate competition in the
    competitive transport market. *Expanded Interconnection with Local
    Telephone Company Facilities, First Report and Order*, 7 FCC Rcd
    7369 (1992) (*Special Access Order*), *vacated in part and remanded,
    Bell Atlantic I*, 24 F.3d 1441 (D.C. Cir. 1994); *First
    Reconsideration*, 8 FCC Rcd 127 (1993); *vacated in part and
    remanded, Bell Atlantic I*, 24 F.3d 1441 (D.C. Cir. 1994); *Second
    Reconsideration*, 8 FCC 7341 (1993); *Second Report and Order*, 8
    FCC Rcd 7374 (1996) (*Switched Transport Order*), *vacated in part
    and remanded, Bell Atlantic Telephone Cos. v. FCC*, 24 F.3d 1441
    (D.C. Cir. 1994); *Remand Order*, 9 FCC Rcd 5154 (1994) (*Virtual
    Collocation Order*), *remanded for consideration of 1996 Act,
    Pacific Bell, et. al. v. FCC*, 81 F.3d 1147 (D. C. Cir. 1996)
    (collectively referred to as *Expanded Interconnection*). In
    addition, in furtherance of the procompetitive, deregulatory
    framework established by the 1996 Act, the Commission's pricing
    flexibility rules place significant importance on the presence of
    competitive transport providers in order to grant pricing
    flexibility to incumbent LECs. *See* *Access Charge Reform*, Fifth
    Report and Order and Further Notice of Proposed Rulemaking, CC
    Docket No. 96-262, 14 FCC Rcd 14221 (1999), *aff'd sub nom.*
    *WorldCom, Inc. v. FCC*, 238 F.3d 449 (D.C. Cir. 2001).

[^170]: *See*, *e.g*., Sprint Comments at 13 (arguing that if Sprint
    cannot deliver traffic from its collocation space in an incumbent
    LEC office to another collocated competitive LEC, it would be forced
    either to use the incumbent's transport services or to build out its
    own local transport facilities); Focal Comments at 17 (asserting
    that an inability to cross-connect would place competitive LECs at a
    competitive disadvantage because they would essentially lack any
    choice for transport from non-incumbent LEC sources).

[^171]: *See AT&T v. FCC*, 220 F.3d 607, 611 (D.C. Cir. 2000); *Joint
    Explanatory Statement*, *supra* note 13, at 1.

[^172]: Although incumbent LECs argue that competitive LECs could also
    have a competitive transport provider pull individual fibers to each
    collocation space, s*ee, e.g.,* Verizon Reply 4-5, this approach
    could require the competitive transport provider to obtain local
    permits and dig up the streets every time it wishes to reach a new
    competitive LEC in the same incumbent LEC premises.

[^173]: *See* Sprint Comments at 13 (contending that the competitive
    LEC's alternative would be to build facilities that, given the very
    high capacity of fiber optic cable today, may be so underutilized as
    to be uneconomic).

[^174]: *See Detariffing the Installation and Maintenance of Inside
    Wiring*, 7 FCC Rcd 1334, 1335, para. 8 (1992) (recognizing that
    requiring telephone subscribers to purchase inside wiring service
    from a LEC, even if they wish to purchase those services from the
    LEC's competitors, would eliminate virtually all potential for
    competition for inside wiring services); *see also NARUC v. FCC*,
    880 F.2d 422, 430 (D.C. Cir. 1989) (*NARUC III*).

[^175]: *Joint Explanatory Statement*, *supra* note Error: Reference
    source not found, at 1; *see, e.g.,* Focal Comments at 17 (arguing
    that Congress enacted the 1996 Act to facilitate competition, not
    ensure the incumbents an interoffice transport monopoly).

[^176]: *See Akron, Canton & Youngstown R.R. v. ICC*, 611 F.2d 1162
    (6^th^ Cir. 1979), *cert. denied*, 449 U.S. 830 (1980) (upholding
    requirement that railroad carrier transport spent fuel and
    radioactive waste even though the railroad had not held itself out
    as a common carrier with respect to such cargo); *cf. Associated Gas
    Distributors v. FERC*, 824 F.2d 981, 995-101 (D.C. Cir. 1987)
    (upholding Federal Energy Regulatory Commission decision to impose
    common carriage open access requirements on interstate gas pipeline
    companies in order to prevent pipelines from discriminating against
    non-pipeline gas suppliers and to ensure that consumers are able to
    obtain gas at competitive levels.); *see also* *NARUC II*, 533 F.2d
    at 609 (where the agency has imposed such obligations, that is
    adequate to confer common carrier status).

[^177]: *See Bell Telephone Co. of Pennsylvania v. FCC*, 503 F.2d 1250,
    1253-54 (3^rd^ Cir. 1974).

[^178]: *Virtual Collocation Order*, 9 FCC Rcd at 5161-62, paras. 18-19.

[^179]: There are two ways to determine that a communications service
    qualifies as a common carrier service. A communications service will
    be considered a common carrier service if: (1) a common carrier
    holds out the service to the general public on a common carrier
    basis or (2) the Commission finds that it is "necessary or desirable
    in the public interest" for the service to be provided on a common
    carrier basis. *See NARUC v. FCC,* 525 F.2d 630, 641, 644 n.76 (D.C.
    Cir. 1976) (*NARUC I*); *see also* *NARUC v. FCC*, 533 F.2d 601,
    608-9 (D.C. Cir. 1976 (*NARUC II*) (binding requirement by agency
    that company provide service on indifferent basis is adequate to
    confer common carrier status). We exercise our authority under the
    second prong to designate the provision of cross-connects between
    two collocated carriers as a common carrier service.

[^180]: *See, e.g.,* Focal Comments at 17.

[^181]: *See* Joint Commenters at 53-55 (arguing that as a final -- and
    least desirable -- alternative, the Commission should require
    incumbent LECs to tariff a cross-connection service, in accordance
    with sections 201(a) and 251(a)(1)); *see also Bell Telephone Co. of
    Pa. v. FCC*, 503 F.2d 1250, 1270-73 (3d Cir. 1974) (*Pennsylvania
    Bell v. FCC*).

[^182]: *See* SBC Reply at 27.

[^183]: *Bell Atlantic I*, 24 F.3d at 1444-46.

[^184]: *Virtual Collocation Order*, 9 FCC Rcd at 5163-34 paras. 25-26.

[^185]: *Id.*

[^186]: 47 U.S.C. § 201(b).

[^187]: *See* Qwest Reply at 6 (asserting that there can be little doubt
    that the Commission can require an incumbent LEC to provide special
    access services between two locations outside the incumbent's
    central office and that the Commission similarly can require the
    incumbent to provide a special access interconnection service
    (*i.e*., a cross-connect) within a central office for competitive
    LECs that are lawfully collocated in that office).

[^188]: This offering includes what amounts to the provision of a
    dedicated circuit or line (carrying both interstate and intrastate
    traffic) that connects collocated equipment to the competitive LEC's
    transport provider of choice when that transport provider is
    collocated.

[^189]: We note that this is not the same situation that was present in
    *Southwestern Bell Telephone Co. v. FCC*, 19 F.3d 1475 (D.C. Cir.
    1994) (*Southwestern Bell v. FCC*). In *Southwestern Bell v. FCC*,
    the court found that the Commission did not have adequate support
    for its conclusion that LECs had offered "dark fiber service" on a
    common carrier basis. However, in the instant case, the Commission
    is declaring that a dark fiber service with respect to
    cross-connects is a common carrier service using the second prong
    under *NARUC II*. *See* note 179, *supra*.

[^190]: *See generally*, AT&T Apr. 20, 2001 *Letter*, *supra* note
    Error: Reference source not found, at 5.

[^191]: *GTE Telephone Operating Cos., GTOC Tariff No. 1, GTOC
    Transmittal No. 1148*, 13 FCC Rcd 22466, 22478-22481, paras. 22-27
    (1998) (*GTE ADSL Service Order*).

[^192]: *Id*. at 22479, para. 23; *see also MTS and WATS Market
    Structure, Amendment of Part 36 of the Commission's Rules and
    Establishment of a Joint Board*, Decision and Order, 4 FCC Rcd 1352,
    1357, para. 30-32 (Jt. Bd. 1989); *adopted MTS and WATS Market
    Structure, Amendment of Part 36 of the Commission's Rules and
    Establishment of a Joint Board*, 4 FCC Rcd 5660, 5660-61, paras. 6-9
    (1989) (*MTS and WATS Market Structure Order*) (adopting ten percent
    rule for jurisdictional separations purposes).

[^193]: *GTE ADSL Service Order*, 13 FCC Rcd at 22479, para. 23.

[^194]: Our authority to impose cross-connect requirements under section
    251(c)(6) does not depend upon the presence of interstate traffic.

[^195]: 47 U.S.C. § 208.

[^196]: 47 U.S.C. § 251(c)(6).

[^197]: *Expanded Interconnection with Local Telephone Company
    Facilities, First Report and Order*, 7 FCC Rcd 7369, 7442, para. 157
    (1992) (*Special Access Order*) (addressing LEC-to-collocator
    cross-connects), *vacated in part and remanded, Bell Atlantic I*, 24
    F.3d 1441 (D.C. Cir. 1994); *First Reconsideration*, 8 FCC Rcd 127
    (1993); *vacated in part and remanded, Bell Atlantic I*, 24 F.3d
    1441 (D.C. Cir. 1994); *Second Reconsideration*, 8 FCC 7341 (1993);
    *Second Report and Order*, 8 FCC Rcd 7374 (1996) (*Switched
    Transport Order*), *vacated in part and remanded, Bell Atlantic
    Telephone Cos. v. FCC*, 24 F.3d 1441 (D.C. Cir. 1994); *Remand
    Order*, 9 FCC Rcd 5154 (1994) (*Virtual Collocation Order*),
    *remanded for consideration of 1996 Act sub nom. Pacific Bell. v.
    FCC*, 81 F.3d 1147 (D.C. Cir. 1996) (collectively referred to as
    *Expanded Interconnection Proceeding*).

[^198]: *See* *Local Competition Order*, 11 FCC Rcd 15499 at 15588,
    para. 173. As indicated previously, *see* note Error: Reference
    source not found, *supra*, the Eighth Circuit generally affirmed the
    collocation rules adopted in the *Local Competition Order* without
    specifically addressing the cross-connects rule adopted in that
    *Order*. *See Iowa Utilities Bd. v. FCC*, 120 F.3d at 818.

[^199]: *Local Competition Order*, 11 FCC Rcd 15499 at 15801, para. 594.

[^200]: 47 U.S.C. § 251(c)(6).

[^201]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4779-80, para. 32-33.

[^202]: *See* Qwest Comments at 16 (arguing that it would not be just
    and reasonable to prohibit a competitive LEC from cross-connecting
    with other competitive LECs when those competitive LECs have
    otherwise legitimately obtained collocation under the Act).

[^203]: *GTE v. FCC*, 205 F.3d 416 (D.C. Cir. 2000).

[^204]: *Id.* at 423-24.

[^205]: *Id.*

[^206]: *See id*.

[^207]: *Id.* (*emphasis added*).

[^208]: *See id*.

[^209]: Verizon argues that such a requirement would turn their central
    office into a hub. Verizon Reply at 5 (asserting that collocators do
    not have a right to use precious central office space as a hub to
    connect to each other, regardless of whether it would be more or
    less expensive than connecting on their own premises, and that
    Congress would not have restricted collocation to that which is
    "necessary for interconnection or access to unbundled network
    elements" if it intended to allow unfettered occupation of central
    office space by competing carriers); s*ee also* SBC Reply at 26. We
    disagree. Requiring incumbent LECs to provision cross-connects
    between two collocated competitive LECs does not expand the number
    of competitive LECs that can collocate at an incumbent\'s premises.
    Incumbent LEC provisioning of cross-connects does not allow
    "unfettered occupation of central office space by competing
    carriers." *See* Verizon Reply at 5. Indeed, competitive LECs must
    continue to meet the same statutory requirements to qualify for
    collocation at an incumbent LEC's premises. *See* Qwest Comments at
    16 (stating that the Act does not allow a competitive LEC to obtain
    collocation from an incumbent LEC for the sole or primary purpose of
    cross-connecting to other competitive LECs). Our cross-connect
    requirement is very limited in scope -- an incumbent LEC must
    provision cross-connects between carriers that are lawfully
    collocated at the incumbent's premises.

[^210]: *See* AT&T Comments at 33; Qwest Reply at 5-6; WorldCom Reply at
    13-14.

[^211]: 47 U.S.C. § 251(a)(1).

[^212]: *Local Competition Order*, 11 FCC Rcd at 15991, para. 997.

[^213]: 47 U.S.C. § 251(c)(6).

[^214]: *Local Competition Order*, 11 FCC Rcd at 15797-98, para. 585.

[^215]: *Id*. at 15803, para. 598.

[^216]: *Advanced Services First Report and Order*, 14 FCC Rcd at
    4784-85, para. 42 (adopting 47 C.F.R. § 51.323(k)(2)).

[^217]: *Id.*

[^218]: *Id.*

[^219]: *GTE v. FCC*, 205 F.3d at 426.

[^220]: *Id.* (quoting 47 U.S.C. § 251(c)(6)).

[^221]: *GTE v. FCC*, 205 F.3d at 426.

[^222]: *Second Further Notice*, 15 FCC Rcd at 17848, para. 96; *see
    also GTE v. FCC*, 205 F.3d at 426.

[^223]: *E.g.,* SBC Comments at 26-27; Verizon Comments at 14.

[^224]: SBC Comments at 27-28.

[^225]: Qwest Comments at 23; SBC Reply at 27-28.

[^226]: SBC Comments at 28; Verizon Reply at 8.

[^227]: CoreComm Comments at 30-31; Covad Comments at 32; DSLnet
    Comments at 41-42; Joint Commenters Comments at 35-36.

[^228]: *See GTE v. FCC*, 205 F.3d at 426.

[^229]: *See*, *e.g.*, Qwest Comments at 23; Verizon Comments at 14-15.

[^230]: The record makes clear that when space assignments have been
    left to the incumbent's unfettered discretion, the incumbent's
    policies and practices have frequently resulted in central offices
    with large, unused areas unavailable for physical collocation,
    little adequate space available for physical collocation, and
    extremely high physical collocation construction charges. Covad
    Comments at 32-33; CTSI Comments at 18; Rhythms Comments at 39-40;
    Mpower Reply at 7.

[^231]: *See* 47 U.S.C. § 251(c)(6).

[^232]: *See* Northpoint Comments at 21-22; Sprint Reply at 7; *Sprint
    Apr. 26, 2001 Letter*, *supra* note 121, at Att., p. 2.

[^233]: *See* Sprint Comments at 14.

[^234]: *See* CTSI Comments at 18; Sprint Reply at 7; *Sprint Apr. 26,
    2001 Letter*, *supra* note 121, at Att., p. 2.

[^235]: We note that the *Second Further Notice* invited comment on
    whether the Commission should adopt national standards governing the
    periods for which incumbent LECs and collocating carriers may
    reserve space for future use in incumbent LEC premises. *See*
    *Second Further Notice*, 15 FCC Rcd at 17856, para. 117. We will
    address this area at a later date.

[^236]: That rule requires that an incumbent LEC must provide, upon
    request, "a report indicating the incumbent LEC's available
    collocation space in a particular LEC premises." 47 C.F.R. §
    51.321(h).

[^237]: *See id.*

[^238]: *See* *Advanced Services First Report and Order*, 14 FCC Rcd at
    4785, para. 42 (adopting 47 C.F.R. § 51.323(k)(2)).

[^239]: *See* *GTE v. FCC*, 205 F.3d at 426; *Advanced Services First
    Report and Order*, 14 FCC Rcd at 4785, para. 42;

[^240]: *Second Further Notice*, 15 FCC Rcd at 17849, para. 97.

[^241]: *Id.* at para. 98.

[^242]: \@Link Comments at 30; Covad Comments at 34; Mpower Comments at
    30; Rhythms Comments at 39.

[^243]: Covad Comments at 33. Specifically, relegating collocators to
    isolated or separated space can increase the distance between the
    DSLAM and a customer's premises. This is a particular problem for
    DSL service providers because a DSLAM must be placed within a
    reasonable distance, usually less than 18,000 feet, of a DSL
    customer's premises if service is to be provided. *See id.*; *see
    also* *Collocation Reconsideration Order & Second Further Notice*,
    15 FCC Rcd at 17812, para. 10.

[^244]: *See* \@Link Comments at 30; Joint Commenters Comments at 40;
    Northpoint Comments at 21; Rhythms Comments at 42-43.

[^245]: *See* \@Link Comments at 41-42 (asserting that separate
    entrances require new doors, walls, and hallways, wasting space that
    might otherwise be used for collocation); CTSI Comments at 19
    (stating that there is no apparent reason for mandatory equipment
    segregation requirements except to inhibit competitors from
    collocating).

[^246]: Covad Comments at 34; Mpower Comments at 30-31; Rhythms Comments
    at 39.

[^247]: Verizon Comments at 17.

[^248]: 47 U.S.C. § 251(c)(6); *see also* Rhythms Reply at 29 (stating
    preference for physical, rather than virtual, collocation).

[^249]: Rhythms Comments at 43 (stating that less obstructive
    alternatives, such as locked cabinets, can ensure protection of the
    incumbent's equipment); Rhythms Reply at 28-29.

[^250]: *See* Verizon Comments at 17-18 (arguing that an incumbent
    should not be required to allow placement of physically collocated
    equipment in same room as its own equipment because segregation of
    equipment is the "only effective means of providing security in a
    collocated environment").

[^251]: *See, e.g.*, Joint Commenters Reply at 18 (quoting *GTE v. FCC*,
    205 F.3d at 425); *see* *also* Rhythms Comments at 43.

[^252]: *Id.* at 31-32.

[^253]: *See GTE v. FCC*, 205 F.3d at 425 ("\[I\]t is hardly surprising
    that the FCC opted to prohibit \[mandatory caged collocation\],
    particularly given the alternative means available to LECs to ensure
    the security of their premises.").

[^254]: 47 C.F.R. § 51.323(i).

[^255]: Rhythms Comments at 43.

[^256]: SBC Reply at 32-33.

[^257]: Despite the D.C. Circuit's explicit finding that the
    Commission's decision to allow cageless collocation was "hardly
    surprising . . . particularly given the alternative means available
    to LECs to ensure the security of their premises," Verizon insists
    that equipment segregation "is the only effective means of providing
    security in a collocated environment." *Compare* *GTE v. FCC*, 205
    F.3d at 425 *with* Verizon Comments at 17-18.

[^258]: Separate entrances must also comply with the applicable fire
    code.

[^259]: For example, SBC has indicated that, where it installs
    partitions between competitor's equipment and its own, SBC will only
    charge the lesser of the cost of the partitions or other viable
    security measures, such as cameras, to address the security risks
    posed by collocation. SBC Comments at 29.

[^260]: *See* 5 U.S.C. § 603.

[^261]: *Second Further Notice*, 15 FCC Rcd at 17864, para. 137.

[^262]: *Id.*

[^263]: *Id.* at 17864, para. 138.

[^264]: *See* 5 U.S.C. § 603. The RFA, *see* 5 U.S.C. § 601 *et seq*.,
    has been amended by the Contract With America Advancement Act of
    1996, Pub. L. No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of
    the CWAAA is the Small Business Regulatory Enforcement Fairness Act
    of 1996 (SBREFA).

[^265]: *Second Further Notice*, 15 FCC Rcd at 17882-87, paras. 26-42.

[^266]: *Id*. at 17882, para. 26.

[^267]: *Id.* at 17886, para. 41.

[^268]: *See* OPASTCO Comments at 6.

[^269]: *Id.*

[^270]: *Id.*

[^271]: 5 U.S.C. §§ 603(b)(3), 604(a)(3).

[^272]: 5 U.S.C. § 601(6).

[^273]: 5 U.S.C. § 601(3) (incorporating by reference the definition of
    "small business concern" in 15 U.S.C. § 632). Pursuant to 5 U.S.C §
    601(3), the statutory definition of a small business applies "unless
    an agency after consultation with the Office of Advocacy of the
    Small Business Administration and after opportunity for public
    comment, established one or more definitions of such term which are
    appropriate to the activities of the agency and publishes such
    definition in the Federal Register."

[^274]: 15 U.S.C. § 632.

[^275]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator: Interstate Service Providers*, Table 1 (October 2000)
    (*Carrier Locator*).

[^276]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator* at Table 1.

[^277]: 5 U.S.C. § 601(3).

[^278]: Letter from Jere W. Glover, Chief Counsel for Advocacy, SBA, to
    William E. Kennard, Chairman, FCC (May 27, 1999). The Small Business
    Act contains a definition of "small business concern," which the RFA
    incorporates into its own definition of "small business." *See* 15
    U.S.C. § 632(a) (Small Business Act); 5 U.S.C. § 601(3) (RFA). SBA
    regulations interpret "small business concern" to include the
    concept of dominance on a national basis. 13 CFR 121.102(b). Since
    1996, out of an abundance of caution, the Commission has included
    small incumbent LECs in its regulatory flexibility analyses. *See*,
    *e.g*., *Implementation of the Local Competition Provisions of the
    Telecommunications Act of 1996*, CC Docket, 96-98, First Report and
    Order, 11 FCC Rcd 15499, 16144‑45 (1996), 61 FR 45476 (Aug. 29,
    1996).

[^279]: U.S. Department of Commerce, Bureau of the Census*, 1992 Census
    of Transportation, Communications, and Utilities: Establishment and
    Firm Size*, at Firm Size 1‑123 (1995) (*1992 Census*).

[^280]: *See generally* 15 U.S.C. § 632(a)(1).

[^281]: *1992 Census, supra*, at Firm Size 1‑123.

[^282]: 13 C.F.R. § 121.201, NAICS codes 51331, 51333, and 51334.

[^283]: 13 C.F.R. § 121.201, NAICS codes 51331, 51333, and 51334.

[^284]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator* at Table 1*.*

[^285]: 13 C.F.R. § 121.201, NAICS codes 51331, 51333, and 51334.

[^286]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator* at Table 1.

[^287]: 13 C.F.R. § 121.201, NAICS codes 51331, 51333, and 51334.

[^288]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator* at Table 1.

[^289]: 13 C.F.R. § 121.201, NAICS codes 51331, 51333, and 51334.

[^290]: FCC, Common Carrier Bureau, Industry Analysis Division, *Carrier
    Locator* at Table 1.

[^291]: *See* Letter from A. Alvarez, Administrator, SBA, to Amy Zoslov,
    Chief, Auctions and Industry Analysis Division, FCC (Dec. 2, 1998).

[^292]: 5 U.S.C. § 603(c).

[^293]: 47 U.S.C. § 160(d).

[^294]: *See* OPASTCO Comments at 6; para. 3, *supra*. We note that
    OPASTCO does not address directly any of the issues remanded by the
    D.C. Circuit and thus does not raise any specific alternatives we
    might consider in this *Order*.

[^295]: *See* Order at part V.B.2.

[^296]: *See* 5 U.S.C*.* § 801(a)(1)(A).

[^297]: *See* 5 U.S.C. § 604(b).