United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 10, 2002 Decided June 18, 2002

No. 01-1371

Verizon Telephone Companies, et al.,

Petitioners

v\.

Federal Communications Commission and

United States of America,

Respondents

WorldCom Inc., et al.,

Intervenors

Consolidated with

01-1379

On Petitions for Review of an Order of the

Federal Communications Commission

Mark L. Evans argued the cause for petitioners. With him on the briefs
were Michael K. Kellogg, Scott K. Attaway, David C. Frederick, Michael
E. Glover, Edward Shakin, Joseph DiBella, Richard M. Sbaratta, James D.
Ellis, Jeffrey B. Thomas and Gary L. Phillips. Roger K. Toppins entered
an appearance.

John Rogovin, Deputy General Counsel, Federal Communications Commission,
argued the cause for respondents. With him on the brief were John E.
Ingle, Deputy Associate General Counsel, Laurence N. Bourne and Rodger
D. Citron, Counsel, Catherine G. O\'Sullivan and Nancy C. Garrison,
Attorneys, U.S. Department of Justice.

David W. Carpenter argued the cause for intervenors American Telephone
and Telegraph Company, et al. With him on the brief were Peter D.
Keisler, James P. Young, Mark C. Rosenblum, Mark D. Schneider, John E.
Benedict, H. Richard Juhnke, Charles C. Hunter, Catherine M. Hannan,
Jonathan Jacob Nadler, Jason Oxman, Thomas F. O\'Neil III, William
Single IV, Teresa K. Gaugler, Rodney L. Joyce, Mary C. Albert and Morton
J. Posner. David L.

Lawson and Paul J. Zidlicky entered appearances.

Before: Ginsburg, Chief Judge, and Randolph and Tatel, Circuit Judges.

Opinion for the Court filed by Circuit Judge Tatel.

Tatel, Circuit Judge: Section 251(c)(6) of the Telecommunications Act of
1996 requires incumbent local exchange carriers to provide competitive
local exchange carriers with space for the \"physical collocation of
equipment necessary for interconnection or access to unbundled network
elements at \[their\] premises.\" Responding to our opinion in GTE
Service Corporation v. FCC, which vacated the Federal Communication
Commission\'s first order implementing section 251(c)(6) \"insofar as it
embrace\[d\] unduly broad definitions of \'necessary\' and \'physical
collocation,\' \" the Commission issued a new order, which petitioners
now challenge. They argue that (1) the Commission\'s standard for
collocatable equipment remains overly broad because it permits
collocation of any equipment \"necessary for interconnection or access\"
whether or not it is \"necessary\" to place such equipment \"at the
premises\"; (2) the Commission unlawfully allowed the placement of
switching and routing equipment, as well as equipment containing
multiple functions only some of which are \"necessary\" for
interconnection or access to network elements; (3) the Commission lacks
authority to order incumbents to physically connect collocating
competitive local exchange carriers to each other; and (4) the
Commission\'s space assignment rules are unlawful. Finding petitioners\'
claims either meritless or waived, we deny the petitions.

I.

In order to foster competition for local telephone services, Congress,
in the Telecommunications Act of 1996, authorized competitive local
exchange carriers (CLECs) to place certain equipment within the premises
of incumbent local exchange carriers (ILECs) so that CLECs could gain
access to ILECs\' networks. Specifically, section 251(c)(6) requires
ILECs 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.\" 47 U.S.C. § 251(c)(6). The
statute provides certain exceptions (not here relevant) for instances
where an ILEC can demonstrate to a state commission that \"physical
collocation is not practical for technical reasons or because of space
limitations.\" Id.

Based on this statutory authorization, the Commission issued an order
entitled Deployment of Wireline Services Offering Advanced
Telecommunications Capability, 14 F.C.C. Rcd. 4761 (1999),
(\"Collocation Order\"), in which it outlined the types of equipment
that may be collocated, established standards for the assignment of
space within the ILEC\'s facilities, and fashioned rules allocating the
initial costs of preparing collocation space. A detailed summary of this
Collocation Order appears in our decision in GTE Service Corporation v.
FCC, 205 F.3d 416, 420 (D.C. Cir. 2000). In that case, although we
affirmed the Commission\'s cost allocation rule, we found defective its
standards for the types of equipment collocatable and its space
assignment rules. The flaws in the Commission\'s prior ruling fell into
three categories, which we outline below together with the Commission\'s
responses on remand. See Deployment of Wireline Services Offering
Advanced Telecommunications Capability, 16 F.C.C. Rcd. 15,435 (2001)
(\"Remand Order\").

Equipment \"necessary\" for interconnection or access

In GTE, we found \"impermissibly broad,\" 205 F.3d at 424, the
Commission\'s interpretation of the phrase \"necessary for
interconnection or access,\" which allowed collocation of any equipment
\" \'used or useful\' for either interconnection or access to unbundled
network elements, regardless of other functionalities inherent in such
equipment,\" Collocation Order p 28. The Commission\'s interpretation,
we observed, \"appear\[ed\] to permit competitors to collocate equipment
that may do more than what is required to achieve interconnection or
access.\" GTE, 205 F.3d at 423.

Responding to this criticism, the Commission now deems equipment
\"necessary\" for purposes of section 251(c)(6) 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.\" Remand Order p 21. In
crafting this new standard, the Commission rejected Verizon\'s argument
that \"necessary\" modifies the phrase \"physical collocation,\"
reasoning that \"such a reading would wrongly place \[the\] focus on
whether \'collocation\' of the equipment is necessary, \... as opposed
to whether the equipment itself, regardless of its location in the
network, is necessary for interconnection \[or\] access to unbundled
network elements.\" Remand Order p 25 (emphasis added) (internal
quotation marks omitted).

In light of its new standard, the Commission also reexam-ined its
treatment of switching and routing equipment. In the Collocation Order,
the Commission expressly declined to require incumbents to collocate
\"equipment used exclusively for switching,\" finding insufficient
support in the record for such a requirement. Collocation Order p 30. At
the same time, however, the Commission warned that it might \"explore
requiring such collocation in the future,\" id.\--precisely what it did
on remand from GTE. Benefitting from a \"greatly expanded record \...
reflect\[ing\] \... parties\' several years of experience with the
unbundled network access regime,\" the Commission reversed course,
Remand Order p 51, concluding that smaller, more modern switching and
routing equipment may be entitled to collocation because it was
\"necessary\" to \"access an unbundled local loop\'s theoretical
capability of providing a telecommunications service,\" id. p 46. The
Commission declined to allow collocation of older, traditional circuit
switches, finding them unnecessary in light of the availability of
smaller, more modern switches.

With regard to multi-functional equipment\--i.e., \"equipment that
combines functions that meet \[the\] equipment standard with functions
that would not meet that standard as stand-alone functions,\" Remand
Order p 32\--the Commission now allows collocation if (1) the \"primary
purpose and function \... as the \... carrier seeks to deploy\" the
equipment are to provide interconnection or access to unbundled network
elements; (2) any additional functions have a \"logical nexus\" to that
purpose; and (3) the additional functions do not \"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,\"
id. pp 36-40.

\"Cross-connect\" requirement

In GTE, we vacated the Commission\'s decision to allow CLECs to connect
their equipment directly to that of other collocating carriers \"subject
only to the same reasonable safety requirements that the \[ILEC\]
imposes on its own equipment.\" Collocation Order p 33. The \"obvious
problem\" with this so-called cross-connect requirement, we thought, was
that it \"impose\[d\] an obligation on \[I\]LECs that ha\[d\] no
apparent basis in \[a\] statute \[that\] focuse\[s\] solely on
connecting new competitors to \[I\]LECs\' networks.\" GTE, 205 F.3d at
423. In its Remand Order, the Commission elected to maintain the
cross-connect requirement, but in a modified form. Instead of allowing
CLECs to provision (i.e., install and maintain) their own
cross-connects, the Commission now requires ILECs to provision
cross-connects upon request. Remand Order p 62. The Commission imposed
that requirement because \"\[i\]f an incumbent \... refuses to provision
cross-connects between \[CLECs\] collocated at the incumbent\'s
premises, the incumbent would be the only LEC that could interconnect
with all or even any of the \[CLECs\] collocated at a common,
centralized point\--the central office.\" Id. p 63. In contrast, for two
CLECs to exchange traffic without a cross connect,

each \[CLEC\] would have to carry its own telecommunications traffic
into its collocation space and then \... have the incumbent LEC
transport that traffic over incumbent-owned facilities to an
interconnection point outside the incumbent\'s premises. From \[there\],
the other \[CLEC\] would likely then carry the traffic back to its own
collocation space in the same central office to be transported through
the \[CLEC\'s\] network.

Id. p 64. Such \"back hauling,\" the Commission found, would impose
\"significant wasteful economic costs\" on CLECs that \"incumbent LECs
themselves do not face\" and that would

\"severely restrict the viability of competitive transport.\" Id. pp 64
& n. 166, 63.

According to the Commission, three separate provisions of the
Communications Act support the new cross-connect requirement. First, the
Commission found the cross-connect requirement authorized under section
201(a), which requires a common carrier:

to furnish such communication service upon reasonable request therefor;
and, in accordance with the orders of the Commission, in cases where the
Commission, after opportunity for hearing, finds such action necessary
or desirable in the public interest, to establish physical connections
with other carriers\....

47 U.S.C. § 201. Second, an incumbent\'s \"refusal to provision
cross-connects,\" the Commission concluded, was an \"unjust and
unreasonable practice in connection with existing services,\" Remand
Order p 72, thus violating section 201(b)\'s requirement that all
\"\[c\]harges, practices, classifications, and regulations for and in
connection with such communication service \... be just and
reasonable.\" 47 U.S.C. § 201(b). Finally, because it felt ILECs would
be operating in an \"unreasonable and discriminatory manner if \[they\]
refused to provide cross-connects between collocators,\" Remand Order p
79, the Commission found the new cross-connect requirement authorized by
section 251(c)(6)\'s requirement of collocation on such \"terms and
conditions\" as are \"just, reasonable, and nondiscriminatory,\" 47
U.S.C. § 251(c)(6). Arguing that GTE does not foreclose this result, the
Commission pointed out that GTE merely rejects the notion that
cross-connects were collocatable equipment and never addresses whether
the Commission \"could require incumbent \... provisioned cross-connects
pursuant to the \'rates, terms, and conditions\' clause of section
251(c)(6).\" Remand Order p 81.

Space assignment rules

Third and finally, in GTE, we vacated the Commission\'s space assignment
rules. By banning ILECs from requiring competitors to use separate
entrances, or isolated rooms or floors, those rules left \"competitors
\... free to pick and choose preferred space on the LECs\' premises,
subject only to technical feasibility.\" GTE, 205 F.3d at 426. Modifying
the space assignment rules in response to GTE, the Commission gave ILECs
\"ultimate responsibility\" for placement of equipment. Remand Order p
90. An ILEC may also provide for the physical segregation of collocated
equipment \"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 stand-point, to
non-separated space.\" Remand Order p 102. Under the Remand Order,
moreover, incumbents may require segregated spaces only where
\"legitimate security concerns, or operational constraints unrelated to
the incumbent\'s \... competitive concerns, warrant them.\" Id. p 102.
The Commission adopted this final requirement after finding \"based on
the record \... that there \[was\] simply insufficient evidence to
support a finding that incumbent\[\'s\] security concerns require
physical separation of collocated equipment \... in every instance.\"
Id. p 101. It also held that ILECs could require separate entrances
\"where construction of such \... entrance\[s\] is technically feasible,
and will neither artificially delay collocation provisioning nor
materially increase the requesting carrier\'s costs\" and where an
incumbent has \"legitimate security concerns.\" Id. p 103.

II\.

Claiming the Commission \"failed to heed this Court\'s mandate\" in GTE,
Pet\'rs\' Opening Br. at 4, petitioner Verizon Communications, Inc.,
together with BellSouth Corporation and SBC Communications, Inc.
(throughout this opinion we shall refer to petitioners as \"Verizon\")
now petition for review. Verizon argues that (1) the Commission\'s new
reading of section 251(c)(6) is overly broad because it allows for the
collocation of equipment \"at the premises\" of ILECs even if
\"interconnection or access\" could be obtained through the use of
off-site equipment, id. at 15 (internal quotation marks omitted); (2)
the Commission acted unlawfully by allowing CLECs to collocate switching
or routing equipment and by permitting CLECs to collocate
multifunctional equipment without demonstrating that each function is
\"necessary for interconnection or access,\" id. at 16; (3) the
Commission has no authority to order carrier-to-carrier cross-connects;
and (4) the new space assignment rules \"grant competitors unwarranted
rights to control the specific location of their equipment within the
incumbent\'s premises,\" id. at 17. Intervening in support of the
Commission are fourteen other telecommunications companies, led by AT&T
Corporation.

The familiar standard established by Chevron U.S.A., Inc. v. Natural
Resources Defense Council, 467 U.S. 837 (1984), governs our review of
the Commission\'s interpretation of a statute it administers. Under this
standard, we first determine whether Congress has \"spoken to the
precise question at issue,\" and if not, we defer to any \"permissible\"
agency interpretation. Id. at 843. We do not understand Verizon to be
arguing that the Commission\'s interpretation fails Chevron\'s first
step, nor could such an argument succeed with respect to the agency\'s
interpretation of section 251(c)(6) in light of our express holding that
the relevant statutory terms are ambiguous. See GTE, 205 F.3d at 421
(holding that the \"disputed terms at issue\--\'necessary,\' \'physical
collocation,\' and \'premises\' \... are ambiguous in their meanings\").
Consequently, we \"defer to the Commission\'s interpretations if they
are reasonable and consistent with the statutory purpose.\" Id. Our
deference is particularly great where, as here, the issues involve \"a
high level of technical expertise in an area of rapidly changing
technological and competitive circumstances.\" Sprint Comms. Co. v. FCC,
274 F.3d 549, 556 (D.C. Cir. 2001). With this highly deferential
standard in mind, we consider each of Verizon\'s arguments.

We begin with Verizon\'s claim that the phrase \"equipment necessary for
interconnection or access to unbundled network elements at the premises
of the local exchange carrier,\" 47 U.S.C. § 251(c)(6), means that CLECs
may not place equipment on an ILEC\'s premises unless an off-site
location is infeasible. According to Verizon, the Commission\'s
interpretation, which focuses on whether the equipment is necessary for
interconnection or access \"regardless of its location in the network,\"
Remand Order p 25, \"ignore\[s\] the pivotal phrase at the end of the
sentence, which makes clear that equipment must be necessary \... at the
premises of the local exchange carrier,\" Pet\'rs\' Opening Br. at 20.
The only sensible interpretation of this language, Verizon argues, is
that \"the adjective \'necessary\' \" \"relates\" to \"both components
of the compound prepositional phrase \'for interconnection or access
\... at the premises of the local exchange carrier.\' \" Pet\'rs\' Reply
Br. at 4. Otherwise, \"the \'premises\' clause does no work at all; it
is simply a redundant appendage.\" Pet\'rs\' Opening Br. at 20.

As the Commission points out, on remand from GTE, Verizon made an
entirely different textual argument, namely, that the word \"necessary\"
modifies \"physical collocation,\" not \"equipment.\" See Comments of
the Verizon Telephone Companies, Oct. 12, 2000 at 2 (requesting the
Commission \"find that the term \'necessary\' modifies the phrase
\'physical collocation of equipment,\' so that any physical collocation
can be ordered only where that collocation is \'necessary for
interconnection or access to unbundled network elements\' \"). The
Commission rejected that argument, finding that the \"most natural
reading\" of the statutory language, as dictated by \"simple grammar,\"
is that the term \"necessary\" modifies \"equipment,\" not \"physical
collocation.\" Remand Order p 25. Seizing upon this variation, the
Commission insists that Verizon has waived its \"at the premises\"
argument. See High Plains Wireless, LP v. FCC, 276 F.3d 599, 608 (D.C.
Cir. 2002) (citing 47 U.S.C. § 405(a)). We agree.

Conceding that it never presented to the Commission the precise textual
argument it raises now, Verizon argues that \"every facet of an
argument\" need not be presented to the Commission as long as the
\"basic challenge to a Commission policy was reasonably flagged.\"
Pet\'rs\' Reply Br. at 9 (citation and internal quotation marks
omitted). The case Verizon relies upon, Time Warner Entertainment Co. v.
FCC, 144 F.3d 75, 81 (D.C. Cir. 1998), however, establishes a slightly
more demanding test. There, we held that if \"a petitioner makes a basic
challenge to a Commission policy, but the formulation of the issue
presented to us was not precisely as presented to the Commission, we ask
whether a reasonable Commission necessarily would have seen the question
raised before us as part of the case presented to it.\" 144 F.3d 75, 81
(D.C. Cir. 1998). Here, Verizon made a quite specific textual argument
before the Commission\--that the word \"necessary\" modifies the phrase
\"physical collocation.\" In responding to this argument, the Commission
had no occasion to consider the different textual argument made
here\--that the word \"necessary\" relates to the phrase \"at the
premises\" as well as to the phrase \"physical collocation.\" The
textual argument Verizon made before the Commission does not logically
implicate the one it makes now, as would have been the case if, for
example, the Commission, in order to arrive at its decision, would
necessarily have had to determine the effect of the \"at the premises\"
language. In short, we do not believe that a \"reasonable Commission
necessarily would have seen\" the argument Verizon now raises.

We have expressed our concern about the effect on federal \"agencies\'
rightful role in statutory construction under the Chevron framework\"
when petitioners fail \"to present statutory challenges to \... agencies
for initial resolution.\" Linemaster Switch Corp. v. EPA, 938 F.2d 1299,
1309 (D.C. Cir. 1991). This case implicates that concern. Chevron\'s
second step requires that we defer to an agency\'s interpretation of
ambiguous statutory provisions such as section 251(c)(6). By failing to
raise before the Commission the textual argument it makes now, Verizon
has deprived us of the Commission\'s expert judgment, informed by the
pertinent policy considerations, as to the relationship between the word
\"necessary\" and the phrase \"at the premises.\" Were we to reject the
Commission\'s waiver argument, we would have to undertake the very sort
of freewheeling policy inquiry that Chevron deference was crafted to
avoid. This we may not do.

Our conclusion that Verizon has waived its primary statutory claim
largely moots its challenge to the Commission\'s decision to allow
collocation of switches and routers in certain instances, as Verizon\'s
arguments depend heavily on its assertion that CLECs could feasibly
locate such equipment off-premises. Verizon, however, makes an
additional argument that focuses more precisely on the Commission\'s
reasoning with respect to switches and routers rather than the general
standard for equipment entitled to collocation. The Commission
determined that without a

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, a requesting
carrier must, as a practical, economic and operational matter, be able
to switch or route traffic to or from that loop.

Remand Order p 46 (internal quotation marks omitted). According to
Verizon, this reasoning \"has no apparent stopping point: Every piece of
equipment in a competitor\'s network is arguably necessary to complete a
call and thereby \'to access an unbundled local loop\'s theoretical
capability of providing telecommunications service.\' \" Pet\'rs\'
Opening Br. at 24. Although acknowledging the Commission\'s ruling that
equipment used for \"call-related databases, information services, or
operations support\" (i.e., back office equipment) \"may not be
collocated,\" Pet\'rs\' Br. at 24 (citing Remand Order p 24), Verizon
insists that the Commission \"failed to articulate any coherent limiting
principle to justify those exclusions\" since a \"competitor could
hardly complete a call without using the appropriate database to
determine where a call must be switched\--thereby making such a database
\'necessary\' on the same flawed reasoning that switching equipment is
supposedly necessary.\" Pet\'rs\' Reply Br. at 12-13. Again, we
disagree.

To begin with, we think it inaccurate to say that the Commission\'s
reasoning has no limiting principle. Putting aside the question of
whether a call-related database is \"necessary\" to access the functions
of a local loop, Verizon gives us no reason to believe that the
Commission\'s standard fails coherently to exclude \"operations support
system equipment\" and other \"troubleshooting, billing or
record-keeping\" equipment. Pet\'rs\' Reply at 12. Moreover, even with
respect to call-related databases, given the heavy deference owed, the
distinctions drawn by the Commission easily withstand scrutiny. The
Commission relied on the fact that switching and routing equipment
activates those capabilities of a loop that allow the loop to carry
calls. That is not the case with call-related databases, which merely
allow the switch to identify which local loop to activate but do not
actually activate the loop\'s capabilities themselves.

Verizon next challenges the Commission\'s decision to allow collocation
of multifunctional equipment in certain circumstances. According to
Verizon, \"that view of the Commission\'s statutory authority is
squarely foreclosed by this Court\'s holding in GTE that the statute
does not permit competitors to smuggle unnecessary functions into
otherwise necessary equipment.\" Pet\'rs\' Opening Br. at 26. GTE
contains no such holding. Rather, GTE simply expresses concern over the
Collocation Order\'s standard, which seemed to allow competitors to add
any function that \"lower\[ed\] costs and increase\[d\] the services
they \[could\] offer their customers.\" GTE, 205 F.3d at 424. By
contrast, the Remand Order limits collocation of multifunctional
equipment to devices whose \"primary purpose\" is interconnection or
access to unbundled network elements and whose additional functions have
a \"logical nexus\" to this primary purpose, Remand Order WW 36-40. We
find this statutory interpretation eminently reasonable, particularly
since the statute speaks of collocatable \"equipment\" not
\"functions.\" 47 U.S.C. § 251(c)(6).

Next, Verizon claims that the cross-connect requirement can be justified
under neither section 201 nor section 251(c)(6). Relying on the general
rule that \"a specific statute will not be controlled or nullified by a
general one,\" Crawford Fitting Co. v. J.T. Gibbons, 482 U.S. 437, 445
(1987), Verizon first argues that the \"general authority in section 201
simply does not empower the Commission to sidestep the specific
limitation in section 251(c)(6) on the authorized use of collocated
equipment.\" Pet\'rs\' Opening Br. at 38. Under the Remand Order,
however, cross-connects are no longer collocated; rather, they are owned
and maintained by the incumbent. Thus, section 251(c)(6)\'s limitations
on collocatable equipment are irrelevant. Cf. Verizon Tel. Cos. v. FCC,
122 S.Ct. 1646, 1684 (2002) (noting in the context of section 251(c)(3)
that \"it takes a stretch to get from permissive statutory silence to a
statutory right on the part of incumbents to refuse to combine
\[unbundled network elements\] for a requesting carrier\").

The only issue, then, is whether the cross-connect require-ment can be
justified under either section 201(a) or (b). Although the Commission
explicitly invoked both subsections, Verizon\'s opening brief never
addresses section 201(b). Not until its reply brief does Verizon argue
that section 201(b) might not apply even in the absence of section
251(c)(6), Pet\'rs\' Reply Br. at 22, but this comes too late, see Power
Co. of Am., L.P. v. FERC, 245 F.3d 839, 845 (D.C. Cir. 2001) (finding
arguments not in opening brief waived). We will thus affirm the
Commission on that ground without reaching the question of whether the
Commission reasonably invoked either section 201(a) or section
251(c)(6)\'s \"terms\[ \] and conditions\" clause.

This brings us, finally, to Verizon\'s challenge to the space assignment
rules. According to Verizon, the \"new rules, though superficially more
limited\" than the previous rules struck down in GTE, \"nonetheless
effectively allow competitors to insist on their space preferences and
apparently prevent incumbents from requiring that competitors install
their equipment in segregated space.\" Pet\'rs\' Opening Br. at 40. This
argument lacks merit. Attempting to make the current rule resemble the
vacated portions of the previous rule, Verizon mischaracterizes both.
For example, Verizon states that \"the default rule effectively remains
what it was before: Incumbents apparently may not, as a general matter,
require segregated collocation space and separate entrances.\" Pet\'rs\'
Opening Br. at 40 (emphasis added). This inaccurately describes the
Collocation Order; instead of mandating as a \"default\" that incumbents
could not require segregated space and separate entrances, that order
prohibited their use completely. See Collocation Order p 42.

Turning to the current rule and mischaracterizing it as well, Verizon
argues that ILECs\' \"security and efficiency concerns apparently count
for nothing in the Commission\'s calculus.\" Pet\'rs\' Opening Br. at
41. The Commission, however, abandoned the requirement that CLECs be
permitted to control the placement of equipment; rather, the Remand
Order acknowledges that because \"\[a\]n incumbent is far more familiar
with the design and layout of its premises,\" it should have \"ultimate
responsibility\" for determining where to place equipment. Remand Order
p 90. Moreover, rather than banning separate entrances and segregated
facilities outright, the Commission established a presumption against
their use, which ILECs can rebut by showing that legitimate security
concerns require separate facilities or entrances, that the separate
facilities are comparable from an engineering stand-point, that they are
available on a similar time frame, and that their use will not
\"materially\" increase CLEC costs. Remand Order p 102. Finally, the
Commission did not ignore ILEC security concerns; rather, it found
\"insufficient evidence to support a finding that \[those\] concerns
require physical separation of collocated equipment from the
incumbent\'s own equipment in every instance.\" Id. p 101.

As Verizon\'s brief makes clear, it prefers a rule that \"at a minimum,
permit\[s\] an incumbent, as a default, \... to determine where in its
central office \... competitors may install their equipment and the path
they may take through those buildings.\" Pet\'rs\' Opening Br. at 40.
But this is a policy judgment for the Commission; nothing in the statute
mandates such a result or disallows the path the Commission here has
chosen.

III\.

The petitions for review are denied.

So ordered.