**Before the**

Federal Communications Commission

Washington, D.C. 20554

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| In the Matter of                 | * | WC Docket No. 07-256         |
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| Feature Group IP Petition for    | ) |                              |
| Forbearance From Section 251(g)  | * |                              |
| of the Communications Act and    | * |                              |
| Sections 51.701(b)(1) and        |   |                              |
| 69.5(b)                          | * |                              |
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| of the Commission's Rules        | ) |                              |
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memorandum opinion and order

**Adopted: January 21, 2009 Released: January 21, 2009**

By the Commission: Commissioner McDowell issuing a statement.

# introduction

1.  In this Order, we deny a petition filed by Feature Group IP West
    LLC, Feature Group IP Southwest LLC, UTEX Communications Corp.,
    Feature Group IP North LLC, and Feature Group IP Southeast LLC
    (Feature Group IP) requesting that the Commission forbear from
    section 251(g) of the Communications Act of 1934, as amended (Act),
    and sections 51.701(b)(1) and 69.5(b) of the Commission's rules.[^1]
    For the reasons set forth below, we deny the petition because it
    fails to meet the statutory forbearance criteria.[^2]

# Background

2.  In the 1996 Act,[^3] Congress sought to foster competition in the
    local telephone market, while at the same time ensuring the
    continued provision of affordable service to all Americans.[^4] As
    part of the 1996 Act, Congress adopted section 251(b)(5), which
    requires that all local exchange carriers (LECs) "establish
    reciprocal compensation arrangements for the transport and
    termination of telecommunications."[^5] To ensure the continued
    enforcement of certain pre-1996 Act access obligations and
    restrictions, Congress also enacted a transitional mechanism in
    section 251(g).[^6] In the *Local Competition First Report and
    Order,* the Commission, interpreting section 251(g), concluded that
    the reciprocal compensation provisions of section 251(b)(5) "do not
    apply to the transport or termination of interstate or intrastate
    interexchange traffic" and it required LECs to continue to offer
    interstate and intrastate access services just as they did prior to
    the 1996 Act.[^7] The Commission later characterized section 251(g)
    as a "carve-out provision" that "is properly viewed as a limitation
    on the scope of section 251(b)(5) \[of the Act\]."[^8]

3.  On July 26, 2007, the Commission denied a petition filed by Core
    Communications, Inc. (Core) seeking forbearance from rate regulation
    preserved by section 251(g) of the Act, the rate averaging and rate
    integration required by section 254(g) of the Act, and all related
    implementing rules with respect to all telecommunications
    carriers.[^9] The Commission found that section 251(g) "explicitly
    contemplates affirmative Commission action in the form of new
    regulation" before the access regulation preserved by section 251(g)
    could be eliminated or replaced and, as a result, "the section
    251(b)(5) reciprocal compensation regime would not automatically,
    and by default, govern traffic that was previously subject to
    section 251(g)."[^10] The Commission concluded therefore that
    forbearance from section 251(g) would result in no regulation and
    that the petition failed to meet the statutory forbearance
    criteria.[^11]

4.  On October 23, 2007, Feature Group IP filed a petition asking the
    Commission to forbear from applying access charges to
    "voice-embedded Internet communications."[^12] Feature Group IP
    requests that the Commission "hold that Voice Embedded
    Internet-based communications, services and applications that
    involve or are part of (i) a net change in form; (ii) a change in
    content; and/or (iii) an offer of non-adjunct to basic enhanced
    functionality are enhanced services and, therefore, that the
    so-called 'ESP Exemption' from access charges still applies."[^13]
    Alternatively, Feature Group IP requests that "the Commission . . .
    forbear from application of certain express and implied provisions
    of Section 251(g) of the Communications Act . . . Rule 51.701(b)(1),
    and, where applicable, Rule 69.5(b)" so that access charges do not
    apply to voice-embedded Internet communications.[^14]

# discussion

5.  Consistent with the Commission's *Core Section 251(g)/254(g)
    Forbearance Order*, we find that the Feature Group IP Forbearance
    Petition does not meet the statutory criteria necessary for
    forbearance under section 10(a) of the Act.[^15] The Commission is
    obligated to forbear under section 10(a) only if all three elements
    of the forbearance criteria are satisfied.[^16] Thus, the Commission
    "could properly deny a petition for forbearance if it finds that any
    one of the three prongs is unsatisfied."[^17] As discussed below, we
    find that the Feature Group IP Forbearance Petition does not meet
    any of the statutory forbearance criteria and, accordingly, we deny
    the petition.

6.  For the purposes of conducting our analysis of this petition, we
    assume, *arguendo*, that the foundation of Feature Group IP's
    petition is valid.[^18]  That is, we assume that section 251(g), the
    exception clause in section 51.701(b)(1), and section 69.5(b) of the
    Commission's rules apply to voice-embedded Internet communications,
    with the effect that at least in some circumstances, LECs may
    receive access charges.[^19] 

## Enforcement Remains Necessary to Ensure that Charges and Practices Are Just and Reasonable, and Not Unjustly or Unreasonably Discriminatory

7.  The first prong of section 10(a) states that the Commission shall
    forbear if it determines that "enforcement of such regulation or
    provision is not necessary to ensure that the charges, practices,
    classifications or regulations by, for, or in connection with that
    telecommunications carrier or telecommunications service are just
    and reasonable, and are not unjustly or unreasonably
    discriminatory."[^20] Feature Group IP asserts that enforcement of
    section 251(g), the exception clause in section 51.701(b)(1) and,
    where applicable, section 69.5(b) of the Commission's rules "is not
    necessary to ensure that the charges and practices for the exchange
    of IP-PSTN and incidental PSTN-PSTN voice-embedded Internet
    communications are just, reasonable, and not unjustly or
    unreasonably discriminatory" because, in the absence of these
    provisions, section 251(b)(5) and its implementing rules will govern
    the intercarrier compensation for this traffic.[^21] Feature Group
    IP further contends that forbearance would not result in
    unreasonably discriminatory charges, practices or classifications
    because the Commission would be taking a class of traffic that
    "today generally is not subject to access charges" and treating it
    "in a uniform manner consistent with making a transition to a
    uniform intercarrier compensation regime."[^22] Finally, Feature
    Group IP maintains that the difficulties associated with determining
    the geographic endpoints of voice-embedded Internet communications
    support application of "the statutory default of \[s\]ection
    251(b)(5)."[^23]

8.  As the Commission explained in the *Core Section 251(g)/254(g)
    Forbearance Order*, section 251(g) preserves pre-1996 Act
    compensation obligations and restrictions for "exchange access,
    information access, and exchange services for such access . . .
    until such restrictions and obligations are explicitly superseded
    *by regulations prescribed by the Commission*."[^24] Because section
    251(g) explicitly contemplates affirmative Commission action in the
    form of new regulation, we find that forbearance from section 251(g)
    would not automatically, and by default, mean that section 251(b)(5)
    would govern traffic that was previously subject to section
    251(g).[^25] If the Commission were to forbear from the rate
    regulation preserved by section 251(g) and the related rules, there
    would be no rate regulation governing the exchange of this
    traffic.[^26]

9.  Feature Group IP's claim that forbearance from section 251(g) would
    result in a different intercarrier compensation regime by default is
    the same flawed claim made by Core and denied by the Commission in
    the *Core Section 251(g)/254(g) Forbearance Order*. Feature Group IP
    attempts to distinguish that Commission decision from how it
    believes its request should be resolved. Feature Group IP maintains
    that its request is different from Core's because the Feature Group
    IP Forbearance Petition involves two LECs exchanging traffic between
    an ESP (Feature Group IP's customer) and a local exchange end
    user.[^27] Essentially, Feature Group IP attempts to distinguish the
    *Core Section 251(g)/254(g) Forbearance Order* based on the type of
    providers and the traffic subject to forbearance.[^28]

10.  We find that Feature Group IP's request to forbear from section
    251(g) cannot be distinguished from the *Core Section 251(g)/254(g)
    Forbearance Order*. Absent affirmative action by the Commission,
    forbearance from section 251(g) would result in a regulatory void
    based on the plain language of that statutory provision, regardless
    of what types of carriers or traffic were involved. Due to the
    absence of any such rate regulation if forbearance were granted, and
    the absence of any economic evidence or analysis in the record by
    Feature Group IP or any other commenters, we cannot conclude that
    enforcement of the rate regulation preserved by section 251(g) and
    related implementing rules is not necessary to ensure that charges
    and practices are just and reasonable, and are not unjustly or
    unreasonably discriminatory.[^29]

## Enforcement Remains Necessary for the Protection of Consumers and Forbearance Would Not Be in the Public Interest

11. The second and third prongs of section 10(a) state that the
    Commission shall forbear if "enforcement of such regulation or
    provision is not necessary for the protection of consumers"[^30] and
    if "forbearance from applying such provision or regulation is
    consistent with the public interest." [^31] Feature Group IP
    contends that enforcement of section 251(g), the exception clause in
    section 51.701(b)(1) and, where applicable, section 69.5(b) of the
    Commission's rules is not necessary to protect consumers because the
    record fails to show that exclusion of these communications from the
    access charge regime would adversely affect consumers via end-user
    rate increases or rate discrepancies between urban and rural
    areas.[^32] Feature Group IP also argues that forbearance from
    application of switched access charges to "IP-PSTN and incidental
    PSTN-PSTN Voice-embedded IP communications," and "making a clear
    statement that the exchange of such traffic will be governed by
    \[s\]ection 251(b)(5)," would serve the public interest for a number
    of reasons.[^33]

12. We are unable, on this record, to conclude that enforcement of
    section 251(g), the exception clause in section 51.701(b)(1) and,
    where applicable, section 69.5(b) of the Commission's rules is not
    necessary to protect consumers and that forbearance from these
    provisions is consistent with the public interest. Significantly,
    Feature Group IP provides no evidence to support its claims, and no
    economic analysis of the impact of granting its petition is in the
    record.[^34] Moreover, the Commission is unable to determine with
    reasonable precision the potential impact the requested forbearance
    would have on consumers because the petition is unclear as to what
    traffic would be covered by any decision here.[^35] Even if the
    Commission could determine the exact scope of the forbearance
    requested, however, the additional uncertainty created by the
    regulatory void that would result from forbearance here would be
    detrimental to consumers. Feature Group IP's arguments that
    forbearance would be in the public interest are all premised on the
    assumption that forbearance from section 251(g) would result in this
    traffic being governed by the section 251(b)(5) reciprocal
    compensation regime.[^36] As discussed above, the requested
    forbearance would not have this result. Rather, contrary to Feature
    Group IP's assumption, forbearance would result in a regulatory
    void.[^37] Thus, forbearance would not create any regulatory
    certainty, nor would it reduce the costs associated with disputes
    over the appropriate regulatory treatment of this traffic. Moreover,
    the uncertainty of a regulatory void may harm network investment,
    including in rural areas. Because forbearance would not provide the
    regulatory certainty described by Feature Group IP, we also reject
    arguments that grant of the petition would promote innovation,
    competition, or U.S. preeminence in the high-tech communications
    field. Forbearance also would not create greater efficiencies
    because it would not result in a uniform reciprocal compensation
    regime, as Feature Group IP contends. Accordingly, we cannot find
    that the requested forbearance is consistent with the public
    interest.

13. For these reasons, we find that the Feature Group IP Forbearance
    Petition fails to meet the statutory criteria necessary for
    forbearance. [^38]

# effective date

14. Consistent with section 10 of the Act and our rules, the
    Commission's forbearance decision shall be effective on January 21,
    2009.[^39] The time for appeal shall run from the release date of
    this Order.[^40]

# ordering clauses

15. Accordingly, IT IS ORDERED, pursuant to section 10(c) of the
    Communications Act of 1934, as amended, 47 U.S.C. § 160(c), that the
    petition for forbearance of Feature Group IP West LLC, Feature Group
    IP Southwest LLC, UTEX Communications Corp., Feature Group IP North
    LLC, and Feature Group IP Southeast LLC IS DENIED as set forth
    herein.

16. IT IS FURTHER ORDERED, pursuant to section 10 of the Communications
    Act of 1934, as amended, 47 U.S.C. § 160, and section 1.103(a) of
    the Commission's rules, 47 C.F.R. § 1.103(a), that the Commission's
    forbearance decision SHALL BE EFFECTIVE on January 21, 2009.
    Pursuant to sections 1.4 and 1.13 of the Commission's rules, 47
    C.F.R. §§ 1.4, 1.13, the time for appeal shall run from the release
    date of this Order.

> FEDERAL COMMUNICATIONS COMMISSION
>
> Marlene H. Dortch
>
> Secretary

**STATEMENT OF**

**COMMISSIONER ROBERT M. McDOWELL**

*RE:* *Feature Group IP Petition for Forbearance From Section 251(g) of
the Communications Act and Sections 51.701(b)(1) and 69.5(b) of the
Commission's Rules, WC Docket 07-256.*

It is clear that granting the forbearance petitioners have requested
would not give petitioners the relief sought, but instead would create a
regulatory void and significant uncertainty. In the absence of any
evidence or economic analysis in the record that would allow us to
determine that enforcement of our regulations is unnecessary, I find
that the petition fails to meet the statutory criteria required for
forbearance under Section 10. The petition must, therefore, be denied.

[^1]: Feature Group IP Petition for Forbearance Pursuant to 47 U.S.C. §
    160(c) from Enforcement of 47 U.S.C § 251(g), Rule 51.701(b)(1), and
    Rule 69.5(b), WC Docket No. 07-256 (filed Oct. 23, 2007) (Feature
    Group IP Forbearance Petition). On December 18, 2007, the Commission
    released a Public Notice establishing a pleading cycle for comments
    on the Feature Group IP Forbearance Petition. *Pleading Cycle
    Established for Feature Group IP Petition for Forbearance from
    Section 251(g) of the Communications Act and Sections 51.701(b)(1)
    and 69.5(b) of the Commission's Rules*, WC Docket No. 07-256, Public
    Notice, 22 FCC Rcd 21615 (2007). On January 14, 2008, the Wireline
    Competition Bureau extended the pleading cycle for comments on the
    Feature Group IP Forbearance Petition. *Feature Group IP Petition
    for Forbearance from Section 251(g) of the Communications Act and
    Sections 51.701(b)(1) and 69.5(b) of the Commission's Rules*, WC
    Docket No. 07-256, Order, 23 FCC Rcd 346 (WCB 2008).

[^2]: *See* 47 U.S.C. § 160(a).

[^3]: Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56
    (1996) (codified as amended in scattered sections of 47 U.S.C.)
    (1996 Act).

[^4]: *See Implementation of the Local Competition Provisions in the
    Telecommunications Act of 1996 and Interconnection between Local
    Exchange Carriers and Commercial Mobile Radio Service Providers*, CC
    Docket Nos. 96-98, 95-185, First Report and Order, 11 FCC Rcd
    15499-507, paras. 1-7 (1996) (subsequent history omitted) (*Local
    Competition First Report and Order*).

[^5]: 47 U.S.C. § 251(b)(5); 47 C.F.R. § 51.701(c)-(d) (defining
    transport and termination); *see also* *Local Competition First
    Report and Order*, 11 FCC Rcd at 16008-58, paras. 1027-118
    (discussing reciprocal compensation obligations for the transport
    and termination of telecommunications under section 251(b)(5) of the
    Act).

[^6]: *See* 47 U.S.C. § 251(g) (providing that "\[o\]n and after the
    date of enactment of the Telecommunications Act of 1996, each local
    exchange carrier, to the extent that it provides wireline services,
    shall provide exchange access, information access, and exchange
    services for such access to interexchange carriers and information
    service providers in accordance with the same equal access and
    non-discriminatory interconnection restrictions and obligations
    (including receipt of compensation) that apply to such carrier on
    the date immediately preceding the date of enactment of the
    Telecommunications Act of 1996 under any court order, consent
    decree, or regulation, order, or policy of the Commission, until
    such restrictions and obligations are explicitly superseded by
    regulations prescribed by the Commission after such date of
    enactment"); *see also WorldCom v. FCC*, 288 F.3d 429, 432-33 (D.C.
    Cir. 2002) (finding that section 251(g) is a transitional provision
    designed to keep in place certain restrictions and obligations,
    including the existing access charge regime, until such provisions
    are superseded by Commission regulations).

[^7]: *See Local Competition First Report and Order*, 11 FCC Rcd at
    16013, para. 1034. In a subsequent order, the Commission interpreted
    this provision as a "continuation of the equal access and
    nondiscrimination provisions of the \[AT&T\] Consent Decree until
    superseded by subsequent regulations of the Commission." *Deployment
    of Wireline Services Offering Advanced Telecommunications Capability
    and Advanced Telecommunications Capability*, CC Docket Nos. 98-147,
    98-11, 98-26, 98-32, 98-78, 98-91, Order on Remand, 15 FCC Rcd 385,
    407, para. 47 (1999). The Court of Appeals later held, however, that
    the pre-existing restrictions and obligations referenced in section
    251(g) are not limited to Consent Decree obligations. *See WorldCom
    v. FCC*, 288 F.3d at 433.

[^8]: *See* *Implementation of the Local Competition Provisions in the
    Telecommunications Act of 1996 and Interconnection between Local
    Exchange Carriers and Commercial Mobile Radio Service Providers --*
    *Intercarrier Compensation for ISP-Bound Traffic*, CC Docket Nos.
    96-98, 99-68, Order on Remand and Report and Order, 16 FCC Rcd 9151,
    9167, para. 35 (2001) (*ISP Remand Order*), *remanded on other
    grounds*, *WorldCom v. FCC*, 288 F.3d at 429. Indeed, in defining
    the scope of the reciprocal compensation pricing rules, section
    51.701(b)(1) specifically excludes "interstate or intrastate
    exchange access, information access, or exchange services for such
    access." 47 C.F.R. § 51.701(b)(1). Specifically, the Commission
    found that Congress "did not intend to interfere" with the
    Commission's pre-1996 Act authority with respect to the access
    charge regime and that Congress "exempted the services enumerated in
    section 251(g) from the newly imposed reciprocal compensation
    requirement in order to ensure that section 251(b)(5) is not
    interpreted to override either existing or future regulations
    prescribed by the Commission." *ISP Remand Order*, 16 FCC Rcd at
    9167, para. 36 (footnotes omitted).

[^9]: *See Petition of Core Communications, Inc. for Forbearance from
    Sections 251(g) and 254(g) of the Communications Act and
    Implementing Rules*, WC Docket No. 06-100, Memorandum Opinion and
    Order, 22 FCC Rcd 14118 (2007) (*Core Section 251(g)/254(g)
    Forbearance Order*), *pet. for review dismissed, Core
    Communications, Inc. v. FCC*, 545 F.3d 1 (D.C. Cir. 2008).

[^10]: *Core Section 251(g)/254(g) Forbearance Order*, 22 FCC Rcd at
    14126, para. 14.

[^11]: *Id.* at 14126-28, paras. 14-16.

[^12]: *See* Feature Group IP Forbearance Petition at 24-31.

[^13]: Feature Group IP Forbearance Petition at 3. Feature Group IP
    defines "Voice-embedded Internet communications" as "a particular
    subset of \[voice over Internet Protocol (VoIP)\] communications
    that do not merely use the Internet Protocol \[(IP)\] to transmit
    voice signals undifferentiated from \[public switched telephone
    network (PSTN)\] traffic, but actually uses Internet Protocol to
    provide voice applications as part of a large Internet
    communications experience. . . . We think it is important for
    policymakers to recognize a qualitative difference between services
    that merely use IP technology to provide PSTN-equivalent offerings
    and services that embed IP-based voice applications as part of a
    larger, next-generation Internet communications experience." *Id*.
    at 2 n.3. *But see infra* note 35 (citing other definitions Feature
    Group IP suggests for the services covered by its request). Although
    Feature Group IP uses a variety of different terms throughout its
    petition, for the purposes of this Order, we use the term
    "voice-embedded Internet communications" to describe the services
    that are subject to the instant request for forbearance. Under the
    Commission's access charge regime, the so-called "ESP exemption"
    permits enhanced service providers (ESPs) to purchase local business
    access lines from intrastate tariffs as end users, or to purchase
    special access connections, and thus avoid paying carrier-to-carrier
    access charges. *See Amendments of Part 69 of the Commission's Rules
    Relating to Enhanced Service Providers*, CC Docket No. 87-215,
    Order, 3 FCC Rcd 2631, 2635 n.8, 2637 n.53 (1988) (*ESP Exemption
    Order*); *Access Charge Reform; Price Cap Performance Review for
    Local Exchange Carriers; Transport Rate Structure and Pricing; End
    User Common Line Charges*, CC Docket Nos. 96-262, 94-1, 91-213,
    95-72, First Report and Order, 12 FCC Rcd 15982, 16133-35, paras.
    344-48 (1997) (*Access Charge Reform Order*), *aff'd*, *Southwestern
    Bell v. FCC*, 153 F.3d 523 (8th Cir. 1998); *see also* *MTS and WATS
    Market Structure*, CC Docket No. 78-72, Memorandum Opinion and
    Order, 97 FCC 2d 682, 715, para. 83 (1983) (explaining that ESPs had
    been paying local business service rates for their interstate access
    and would experience rate shock that could affect their viability if
    full access charges were instead applied); *ESP Exemption Order*, 3
    FCC Rcd at 2633, para. 17 ("\[T\]he imposition of access charges at
    this time is not appropriate and could cause such disruption in this
    industry segment that provision of enhanced services to the public
    might be impaired."); *Access Charge Reform Order*, 12 FCC Rcd at
    16133-35, paras. 344-48 ("Maintaining the existing pricing structure
    . . . avoids disrupting the still-evolving information services
    industry.").

[^14]: Feature Group IP Forbearance Petition at 3-4.

[^15]: *See* 47 U.S.C. § 160(a). We note that Feature Group IP seems to
    be seeking forbearance only if the Commission determines that
    voice-embedded Internet communications are not exempt from access
    charges or that the ESP exemption is not maintained. *See* Feature
    Group IP Forbearance Petition at 3-4. Thus, Feature Group IP
    essentially requests a declaratory ruling from the Commission as a
    preliminary matter. *See* Time Warner Telecom *et al.* Comments at
    3-4 (arguing that Feature Group IP's request is essentially a
    petition for declaratory ruling). The Commission has broad
    discretion in determining whether to respond to a request for
    declaratory ruling and, accordingly, because we find that Feature
    Group IP's petition fails to meet the statutory requirements for
    forbearance, we need not address whether such communications are
    exempt from access charges or whether the ESP exemption is
    maintained. *See* 5 U.S.C. § 554(e); 47 C.F.R. § 1.2; *see also* 47
    U.S.C. § 154(i), (j); *Yale Broadcasting Co. v. FCC*, 478 F.2d 594,
    602 (D.C. Cir. 1973) ("An administrative agency should not be
    compelled to issue a clarifying statement unless its failure to do
    so can be shown to be a clear abuse of discretion."), *cert denied*,
    414 U.S. 914 (1973). For similar reasons, we decline to address in
    the context of this forbearance petition whether the Commission has
    exclusive jurisdiction to determine the compensation regime for
    IP-PSTN and incidental PSTN-PSTN traffic. *See* Feature Group IP
    Forbearance Petition at 65 (asking the Commission to "reaffirm" that
    this is an "exclusively interstate matter").

[^16]: *See Cellular Telecommunications & Internet Ass'n v. FCC*, 330
    F.3d 502, 509 (D.C. Cir. 2003) (explaining that the three prongs of
    section 10(a) are conjunctive and that the Commission could properly
    deny a petition for failure to meet any one prong).

[^17]: *Id*.

[^18]: *See AT&T v. FCC*, 452 F.3d 830, 836-37 (D.C. Cir. 2006) ("We
    hold only that the Commission may not refuse to consider a
    petition's merits solely because the petition seeks forbearance from
    uncertain or hypothetical regulatory obligations.").

[^19]: Though we make this assumption for purposes of the section 10(a)
    analysis below, we make no decisions or findings in this Order
    concerning the current compensation rules for these types of
    communications, which are the subject of a pending rulemaking in the
    current *Intercarrier Compensation* proceeding.  On November 5,
    2008, the Commission released a Further Notice of Proposed
    Rulemaking seeking comment on several intercarrier compensation
    reform proposals, including proposals that would address the
    regulatory classification of calls exchanged between IP-based and
    circuit-switched networks. *See generally High Cost Universal
    Service Reform; Federal-State Joint Board on Universal Service;
    Lifeline and Link Up; Universal Service Contribution Methodology;
    Numbering Resource Optimization; Implementation of the Local
    Competition Provisions in the Telecommunications Act of 1996;
    Developing a Unified Intercarrier Compensation Regime; Intercarrier
    Compensation for ISP-Bound Traffic; IP-Enabled Services*, CC Docket
    Nos. 96-45, 99-200, 96-98, 01-92, 99-68, WC Docket Nos. 05-337,
    03-109, 06-122, 04-36, Order on Remand and Report and Order and
    Further Notice of Proposed Rulemaking, FCC 08-262 (rel. Nov. 5,
    2008).

[^20]: 47 U.S.C. § 160(a)(1).

[^21]: *See* Feature Group IP Forbearance Petition at 56-57. More
    specifically, Feature Group IP contends that the section 252(d)(2)
    pricing standards governing the reciprocal compensation regime will
    ensure that the charges and practices for the exchange of this
    traffic will be just and reasonable. *Id.* at 57; *see* 47 U.S.C. §
    252(d)(2).

[^22]: Feature Group IP Forbearance Petition at 59.

[^23]: *Id*. at 60.

[^24]: 47 U.S.C. § 251(g) (emphasis added); *see* *Core Section
    251(g)/254(g) Forbearance Order*, 22 FCC Rcd at 14126, para. 14.

[^25]: *See Competitive Telecom. Ass'n v. FCC*, 117 F.3d 1068, 1072-73
    (8th Cir. 1997) (finding that section 251(g) preserves certain rate
    regimes "until such restrictions and obligations are explicitly
    superseded by regulations prescribed by the \[Commission\]" and
    "leaves the door open for the promulgation of new rates at some
    future date" but that any new rates would not (necessarily) be
    subject to the standards set forth in section 251 and 252); *see
    also* *Core Section 251(g)/254(g) Forbearance Order*, 22 FCC Rcd at
    14126, para. 14.

[^26]: *See Core Section 251(g)/254(g) Forbearance Order*, 22 FCC Rcd at
    14126, para. 14. Several parties agree that, consistent with the
    Commission's findings in the *Core Section 251(g)/254(g) Forbearance
    Order*, forbearance from section 251(g) would not result in the
    application of section 251(b)(5) by default. *See, e.g.,* AT&T
    Comments at 17-18; CenturyTel Comments at 4-5; NECA *et al.*
    Comments at 8; Time Warner Telecom *et al.* Comments at 4-6; Verizon
    Comments at 7; Embarq Reply at 20-21; Letter from Cammie Hughes,
    Authorized Representative, Texas Statewide Telephone Cooperative,
    Inc., WC Docket No. 07-256, at 1 (filed Jan. 12, 2009); Letter from
    Mary Albert, General Counsel, COMPTEL *et al*., to Marlene H.
    Dortch, Secretary, FCC, CC Docket No.01-92, WC Docket Nos. 04-36,
    07-256, 08-8, at 3-4 (filed Jan. 8, 2009). Further, forbearance from
    the exception clause in rule 51.701(b)(1) would not change this
    result as that language merely implements the requirements of
    section 251(g). *Compare* 47 U.S.C. § 251(g) (preserving pre-1996
    Act compensation obligations and restrictions for "exchange access,
    information access, and exchange services for such access"), *with*
    47 C.F.R. § 51.701(b)(1) (excluding "interstate or intrastate
    exchange access, information access, or exchange services for such
    access" from the reciprocal compensation regime). This is not the
    first time the Commission has denied forbearance when a grant would
    not have brought the petitioner the relief it sought. *See Fones4All
    Corp. Petition for Expedited Forbearance Under 47 U.S.C. § 160(c)
    and Section 1.53 from Application of Rule 51.319(d) to Competitive
    Local Exchange Carriers Using Unbundled Local Switching to Provide
    Single Line Residential Service to End Users Eligible for State or
    Federal Lifeline Service*, WC Docket No. 05-261, Memorandum Opinion
    and Order, 21 FCC Rcd 11125 (2006) (*Fones4All Forbearance Order*)
    (concluding that forbearance as requested would not give the
    petitioner the relief it sought and therefore denying the petition),
    *pet. for review denied*, *Fones4All Corp. v. FCC*, 2008 WL 5220266
    (9th Cir. 2008); *Iowa Telecom Petition for Forbearance Under 47
    U.S.C. § 160(c) from the Universal Service High-Cost Loop Support
    Mechanism*, WC Docket No. 05-337, Order, 22 FCC Rcd 15801 (2007)
    (finding that the requested relief would not give Iowa Telecom the
    relief it seeks); *see also* AT&T Comments at 18.

[^27]: Feature Group IP Reply at 28-29.

[^28]: *Id*. at 29.

[^29]: The Commission previously has denied section 10 forbearance
    petitions for lack of sufficient evidence. *See* *Petition of
    OrbitCom, Inc. for Forbearance from CLEC Access Charge Rules*, WC
    Docket No. 08-162, 23 FCC Rcd 13187 (2008) (denying a forbearance
    petition for "fail\[ure\] to address in any manner the statutory
    criteria for a grant of forbearance or to provide any showing that
    those criteria are met by its request"); *see also AT&T Corp. v.
    FCC*, 236 F.3d 729, 731 (D.C. Cir. 2001) (affirming the Commission's
    decision to reject market share data submitted in support of a
    forbearance petition because the carrier failed to provide the
    underlying raw data on which its conclusions were based, making its
    findings unverifiable, but remanding the Commission's decision for
    failure to consider other evidence in record); *Petition of Qwest
    Corporation for Forbearance Pursuant to 47 U.S.C. § 160(c) in the
    Omaha Metropolitan Statistical Area*, WC Docket No. 04-223,
    Memorandum Opinion and Order, 20 FCC Rcd 19415, 19438, para. 50
    (2005) (summarily denying request for forbearance from dominant
    carrier regulation of enterprise services due to a lack of serving
    area-wide information in the relevant geographic market), *aff'd on
    other grounds*, *Qwest Corp. v. FCC*, 482 F.3d 471 (D.C. Cir. 2007);
    *Petitions of Qwest Corporation for Forbearance Pursuant to 47
    U.S.C. § 160(c) in the Denver, Minneapolis-St. Paul, Phoenix, and
    Seattle Metropolitan Statistical Areas*, WC Docket No. 07-97,
    Memorandum Opinion and Order, 23 FCC Rcd 11729 (2008), *pet. for
    review pending*, No. 08-1257 (D.C. Cir. filed July 29, 2008).
    Indeed, the Commission's duty to support its decisions with reasoned
    explanation generally requires that its factual determinations be
    based on evidence. *See Fox Television Stations, Inc. v. FCC*, 489
    F.3d 444, 460 nn.10-11 (2d Cir. 2007).

[^30]: 47 U.S.C. § 160(a)(2).

[^31]: 47 U.S.C. § 160(a)(3). In making its public interest
    determination, the Commission must consider whether forbearance from
    enforcing the provision or regulation will promote competitive
    market conditions, including the extent to which forbearance will
    enhance competition among providers of telecommunications services.
    47 U.S.C. § 160(b).

[^32]: *See* Feature Group IP Forbearance Petition at 61. Feature Group
    IP asserts that, although there has been some migration away from
    PSTN communications, such migration is "unlikely to have a
    significant impact on PSTN revenues in the near term." *Id*. at 62.
    Further, Feature Group IP maintains that any arguments that
    forbearance would disrupt implicit support flows must fail because
    the Commission already subjects some IP-based services to universal
    service obligations and because the 1996 Act requires that any
    implicit subsidies be made explicit. *Id*. at 62-63 (citing 47
    U.S.C. § 254(e)). Although not directly relevant to satisfying the
    second prong of the statutory criteria, Feature Group IP also argues
    that forbearance would benefit consumers through increased
    deployment of voice-embedded Internet communications. *Id.* at
    61-62.

[^33]: *See* Feature Group IP Forbearance Petition at 49. Specifically,
    Feature Group IP contends that forbearance would reduce regulatory
    uncertainty and associated costs. *Id*. at 50-53. Similarly, Feature
    Group IP contends that lack of forbearance will result in legal and
    market uncertainty. *See id.* at 41-45, 47. Feature Group IP further
    argues that forbearance would provide the regulatory certainty
    necessary to spur investment in advanced services and promote
    innovation. *Id*. at 49-50, 53-55. Moreover, Feature Group IP
    asserts that forbearance would create greater efficiencies through a
    uniform reciprocal compensation regime. *Id.* at 49, 55. Finally,
    Feature Group IP states that forbearance would "reestablish U.S.
    preeminence" in the high-tech communications industry. *Id*. at
    49-50, 55-56.

[^34]: *See supra* note Error: Reference source not found; *see also*
    *Fones4All Forbearance Order*, 21 FCC Rcd at 11132, para. 14
    (denying forbearance when "Petitioner has not offered any basis to
    show that granting forbearance is in the public interest").

[^35]: *Compare* Feature Group IP Forbearance Petition at 2 n.3
    (comparing "Voice embedded Internet communications" with "IP-based
    communications"), *with id*. at 10-11 (attempting to describe the
    category of traffic for which it seeks forbearance), *with* *id*. at
    25-27 (providing an expanded description of the traffic covered by
    the petition), *with* *id*. at 65 (referring to both "Voice-embedded
    IP communications" and "voice-embedded IP applications").

[^36]: First, Feature Group IP contends that forbearance would reduce
    regulatory uncertainty and associated costs. *Id*. at 50-53.
    Similarly, Feature Group IP contends that lack of forbearance will
    result in legal and market uncertainty. *See id.* at 41-45, 47.
    Second, Feature Group IP argues that forbearance would provide the
    regulatory certainty necessary to spur investment in advanced
    services and promote innovation. *Id*. at 49-50, 53-55. Third,
    Feature Group IP asserts that forbearance would create greater
    efficiencies through a uniform reciprocal compensation regime. *Id.*
    at 49, 55. Finally, Feature Group IP states that forbearance would
    "reestablish U.S. preeminence" in the high-tech communications
    industry. *Id*. at 49-50, 55-56

[^37]: *See supra* paras. 8-10. For this reason, forbearance would not
    provide answers to the numerous questions and disputes listed by
    Feature Group IP. *See* Feature Group IP Forbearance Petition at
    51-52.

[^38]: Because we conclude that the Feature Group IP Forbearance
    Petition fails to meet the statutory criteria necessary for
    forbearance, we need not address additional matters raised by
    Feature Group IP unrelated to the forbearance requested including
    interconnection disputes, policies, and principles. *See* Feature
    Group IP Reply at 41-52; Feature Group IP's Intercarrier
    Compensation Reply Comments in Response to FNPRM in CC Docket No.
    01-92 and Written *Ex Parte* in WC Docket No. 07-256, CC Docket No.
    01-92, WC Docket No. 07-256, at ii-iii, 3-4 (filed Dec. 22, 2008).

[^39]: 47 U.S.C. § 160(c) (deeming the petition granted as of the
    forbearance deadline if the Commission does not deny the petition
    within the time period specified in the statute); 47 C.F.R.
    § 1.103(a).

[^40]: 47 C.F.R. §§ 1.4, 1.13.