[Federal Register Volume 62, Number 236 (Tuesday, December 9, 1997)]
[Rules and Regulations]
[Pages 64759-64765]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32177]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 52 and 64

[DA 97-2528]


Petitions for Waiver of the Four-Digit Carrier Identification 
Code (CIC) Implementation Schedule

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: On December 3, 1997, the Network Services Division of the 
Commission's Common Carrier Bureau, released an Order granting 
extensions to certain local exchange carriers (LECs) of the January 1, 
1998 deadline for implementing four-digit carrier code identification 
codes (CIC). The Order is intended to respond to waiver requests 
received from certain LECs.

EFFECTIVE DATE: December 3, 1997.

FOR FURTHER INFORMATION CONTACT: Elizabeth Nightingale, Attorney, 
Network Services Division, Common Carrier Bureau, (202) 418-2352.

SUPPLEMENTARY INFORMATION:

    Adopted: December 2, 1997
    Released: December 3, 1997

I. Introduction

    Carrier identification codes (CICs) are numeric codes that enable 
local exchange carriers (LECs) providing interstate interexchange 
access services to identify the interstate interexchange carrier (IXC) 
that the originating caller wishes to use to transmit its interstate 
call.<SUP>1</SUP> LECs use the CICs to route traffic to the proper IXC 
and to bill for the interstate access service provided. CICs facilitate 
competition by enabling callers to use the services of 
telecommunications service providers either by presubscription or by 
dialing a carrier access code, or CAC, which incorporates that 
carrier's unique Feature Group D CIC.<SUP>2</SUP> Originally, CICs were 
unique three-digit codes (XXX) and CACs were five-digit codes 
incorporating the CIC (10XXX).
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    \1\ Most access providers are incumbent local exchange carriers 
(incumbent LECs) that provide access customers with circuits that 
interconnect to the local carrier's public switched telephone 
network. Commission rules require that ``interstate access services 
should be made available on a non-discriminatory basis and, as far 
as possible, without distinction between end user and IC 
[interexchange carrier] customers.'' Petition of First Data 
Resources, Inc., Regarding the Availability of Feature Group B 
Access Service to End Users, Memorandum Opinion and Order, 1986 WL 
291786 (rel. May 28, 1986) at para. 13. Typical access customers 
include interexchange carriers, wireless carriers, competitive 
access providers, and large corporate users.
    \2\ Feature Group D access, or ``equal access,'' is known in the 
industry as ``One-plus'' (``1+'') dialing. This type of access 
allows calls to be routed directly to the caller's carrier of 
choice. Feature Group D/equal access offers features, including 
presubscription, not generally available through other forms of 
access. In 1988, the Industry Carriers Compatibility Forum (ICCF), 
operating under the Alliance for Telecommunications Industry 
Solutions (ATIS), Carrier Liaison Committee (CLC), began to develop 
a two-part plan to convert and expand three-digit Feature Group D 
CICs to four digits. The second part of the plan, originally 
scheduled to occur in the third quarter of 1993, contemplated 
expansion of three-digit Feature Group D CICs to four digits and 
eventual elimination of the 10XXX CAC format. See Letter of October 
13, 1989, from G.J. Handler, Vice President, Network Planning, Bell 
Communications Research (Bellcore), to Richard M. Firestone, Chief, 
Common Carrier Bureau, Federal Communications Commission at 2 
(Handler Letter). The ICCF's plan was published in 1991. See 
Expansion of Carrier Identification Code Capacity for Feature Group 
D (FGD), Bellcore Technical Reference TR-NWT-001050, Issue 1 (April 
1991) (ICCF Expansion Plan, April 1991). In 1994, the expansion of 
Feature Group D CICs was scheduled for the first quarter of 1995. 
See Administration of the North American Numbering Plan, Notice of 
Proposed Rulemaking, CC Docket No. 92-237, 9 FCC Rcd 2068, 2076 
(1994) (59 FR 24103 (5/10/94) (CICs NPRM). In January 1997, the ICCF 
became part of the Network Interconnection Interoperability Forum 
(NIIF), which also operates under the auspices of the CLC.
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    2. On April 11, 1997, in the CICs Second Report and 
Order,<SUP>3</SUP> the Commission approved an industry plan to expand 
Feature Group D CICs from three to four digits on the ground that it 
was a reasonable method of meeting future demand for CICs as the supply 
of three-digit codes was exhausted.<SUP>4</SUP> The industry agreed 
that as the expansion from three to four-digit CICs occurred, and as 
carriers replaced their five-digit CACs with seven-digit CACs, a 
transition, or permissive dialing period, was needed. The industry, 
however, was unable to agree on the length of the 
transition.<SUP>5</SUP> In its 1994 CICs NPRM, the Commission proposed 
a six-year period.<SUP>6</SUP> In the CICs Second Report and Order, 
however, because of the rapidly depleting pool of available three-digit

[[Page 64760]]

CICs, the Commission decided to end the transition on January 1, 1998. 
The Commission also denied requests to ``grandfather'' (i.e., to permit 
carriers to continue to use) previously assigned three-digit CICs that 
are in use at the end of the transition.<SUP>7</SUP> The Commission's 
decisions were intended to advance the pro-competitive objectives of 
the Communications Act of 1934 (the Communications Act or the 
Act),<SUP>8</SUP> as amended by the Telecommunications Act of 1996 
(1996 Act).<SUP>9</SUP>
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    \3\ Administration of the North American Numbering Plan, Carrier 
Identification Codes (CICs), Second Report and Order, CC Docket No. 
92-237, FCC 97-125 (released April 11, 1997) (62 FR 19056 (April 18, 
1997)) (CICs Second Report and Order).
    \4\ See CICs Second Report and Order at para. 28.
    \5\ See Handler Letter at 2.
    \6\ See CICs NPRM, 9 FCC Rcd at 2076-77.
    \7\ See CICs Second Report and Order at para. 46.
    \8\ 47 U.S.C. Secs. 151 et seq.
    \9\ Telecommunications Act of 1996, Pub. L. No. 104-104, 110 
Stat. 56 (1996); see Joint Explanatory Statement of the Committee of 
the Conference, H.R. Rep. No. 458, 104th Cong., 2d Sess. 113.
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    3. On October 22, 1997, in the CICs Order on 
Reconsideration,<SUP>10</SUP> the Commission modified the decision in 
the CICs Second Report and Order regarding the length of the transition 
during which three and four-digit Feature Group D CICs co-exist, and 
created a ``two-step'' end to the transition to four-digit CICs. Under 
the CICs Order on Reconsideration, all LECs that provide equal access 
must have completed switch changes to recognize four-digit CICs by 
January 1, 1998, the end of the first phase. The second phase, which 
ends on June 30, 1998, is intended to allow interexchange carriers time 
to prepare their networks for, and educate their customers about, the 
replacement of three-digit CICs by four-digit CICs. After June 30, 
1998, only four-digit CICs and seven-digit CACs will be recognized. The 
Commission also affirmed its decision in the CICs Second Report and 
Order not to grandfather the use of three-digit CICs and five-digit 
CACs that are in use during the transition.
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    \10\ Administration of the North American Numbering Plan, 
Carrier Identification Codes (CICs), Order on Reconsideration, Order 
on Application for Review, and Second Further Notice of Proposed 
Rulemaking, CC Docket No. 92-237, FCC 97-386 (released October 22, 
1997) (62 FR 55762 (October 28, 1997)) (CICs Order on 
Reconsideration). Prior to the release of the CICs Order on 
Reconsideration, on October 9, 1997, the Commission issued a Further 
Notice of Proposed Rulemaking in this docket. See Administration of 
the North American Numbering Plan, Carrier Identification Codes 
(CICs), Further Notice of Proposed Rulemaking and Order, CC Docket 
No. 92-237, FCC 97-364 (released October 9, 1997) (62 FR 54817 
(October 22, 1997) (CICs FNPRM). The issues raised in the CICs FNPRM 
are unrelated to the waiver petitions we address here.
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    4. Several small LECs have filed petitions for waiver of the CICs 
Second Report and Order's January 1, 1998 conversion 
deadline.<SUP>11</SUP> Hardy requests an extension until April 30, 
1998; Pierce requests an extension until May 1, 1998; Northeast, 
Pioneer, Hartington, and Jefferson request extensions until June 30, 
1998; Hartman requests an extension until July 1, 1998; and Clarks, 
Eustis/Home, and Henderson request extensions until January 1, 2000. 
The LECs generally argue that extensions are warranted because the 
operating system software they need to upgrade to four-digit CIC 
capability is not currently available and is very costly.
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    \11\ See Petition for Limited Waiver of Clarks 
Telecommunications Co., CC Docket No. 92-237, October 2, 1997 
(Clarks Petition); Joint Petition for Limited Waiver of Eustis 
Telephone Exchange, Inc. and Home Telephone Company of Nebraska, CC 
Docket No. 92-237, October 2, 1997 (Eustis/Home Petition); Petition 
for Limited Waiver of Hardy Telecommunications, Inc., CC Docket No. 
92-237, September 23, 1997 (Hardy Petition); Response to Inquiry by 
Hardy Telecommunications, Inc., CC Docket No. 92-237, September 29, 
1997 (Hardy Response to Inquiry); Petition for Waiver of Hartington 
Telecommunications Co., Inc., CC Docket No. 92-237, October 9, 1997 
(Hartington Petition); Errata to Petition for Waiver of Hartington 
Telecommunications Co., Inc., CC Docket No. 92-237, October 10, 1997 
(Hartington Errata to Petition); Petition for Limited Waiver of 
Hartman Telephone Exchanges, Inc., CC Docket No. 92-237, October 6, 
1997 (Hartman Petition); Petition for Limited Waiver of Henderson 
Telephone Company, CC Docket No. 92-237, October 2, 1997 (Henderson 
Petition); Petition for Waiver of Jefferson Telephone Company, CC 
Docket No. 92-237, October 23, 1997 (Jefferson Petition); Petition 
for Limited Waiver of Pierce Telephone Company, Inc., CC Docket No. 
92-237, November 5, 1997 (Pierce Petition); Petition for Waiver of 
Northeast Nebraska Telephone Company, CC Docket No. 92-237, November 
5, 1997 (Northeast Petition); Petition for Limited Waiver of Pioneer 
Telephone Cooperative, Inc., CC Docket No. 92-237, November 14, 1997 
(Pioneer Petition).
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    5. In this Order, we conclude that, for the reasons discussed 
below: (1) The petitions of Hardy, Pierce, Northeast, and Pioneer 
should be granted, by extending for them the switch conversion deadline 
for four-digit CIC capability for the time periods requested; (2) the 
petitions of Hartman, Clarks, Eustis/Home, and Henderson should be 
granted in part, by extending for them the switch conversion deadline 
for four-digit CIC capability, but only until June 30, 1998, and should 
be denied in part, to the extent they request extensions beyond that 
date; and (3) the petitions of Hartington and Jefferson should be 
dismissed as moot.

II. Petitions

A. Request for Extension Until April 30, 1998

    6. Hardy, an incumbent LEC serving rural areas of West Virginia, 
<SUP>12</SUP> that has provided interLATA equal access since 1992, 
<SUP>13</SUP> requests an extension of the switch conversion deadline 
until April 30, 1998. Hardy claims that it is technically infeasible 
for it to comply with the January 1, 1998 deadline. Hardy currently 
operates an Alcatel E-10-Five switch. Hardy asserts that the software 
required to accept four-digit Feature Group D CICs was not available 
when it purchased the interLATA equal access software from Altcatel in 
March 1990. <SUP>14</SUP> Hardy asserts that Alcatel has notified Hardy 
that it will not provide the software upgrades for four-digit CICs. 
<SUP>15</SUP> Hardy explains that it needs to comply with the Rural 
Utilities Service (RUS) requirements (a process it started in early 
1997) to deploy a new switch that would include, among other things, 
four-digit CIC capability. Hardy asserts that the requested extension 
of time until April 30, 1998, will enable it to continue its efforts to 
select, purchase, and deploy a switch capable of providing the four-
digit CIC function. <SUP>16</SUP>
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    \12\ Hardy serves approximately 2,600 access lines. See Hardy 
Petition at 1.
    \13\ See Hardy Response to Inquiry.
    \14\ See id. 
    \15\ See Hardy Petition at 2-3.
    \16\ See id. 
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B. Request for Extension Until May 1, 1998

    7. Pierce, a small, rural LEC providing equal access, requests an 
extension of the switch conversion deadline until May 1, 1998. 
<SUP>17</SUP> Pierce claims that it is technically and economically 
infeasible for it to comply with the January 1, 1998 deadline. 
<SUP>18</SUP> Pierce operates two Northern Telecom (Nortel) switches, 
using operating systems software release version 404.41, which does not 
have four-digit CIC capability. <SUP>19</SUP> Pierce asserts that since 
May 1997, it has made good faith efforts to purchase an updated 
release, but that Nortel has not responded to confirm either price or 
acceptance of the order for the software. <SUP>20</SUP> Pierce asserts 
that it is currently trying to negotiate with Nortel. Once contracts 
are signed, a lead time of 180 days is expected, which Pierce claims 
would mean a mid-1998 implementation date. <SUP>21</SUP> Pierce asserts 
that the Commission's grant of a waiver in the present case is 
consistent with Commission precedent recognizing the technical and 
economic burdens imposed on small and rural LECs in implementing 
software upgrades and granting waivers when those burdens are 
demonstrated. <SUP>22</SUP>
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    \17\ See Pierce Petition at 1 and 3. Pierce serves approximately 
1,870 access lines. See id. at n.3.
    \18\ See id. at 1-2.
    \19\ See id. at 2.
    \20\ See id. at 3.
    \21\ See id.
    \22\ See id. at 3-4, citing Rules and Policies Regarding Calling 
Number Identification Service--Caller ID, Order and Fourth Notice of 
Proposed Rulemaking, CC Docket No. 91-281, 10 FCC Rcd 13796, 13808 
(1995)(60 FR 63491 (December 11, 1995)) (Caller ID Order).

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[[Page 64761]]

C. Requests for Extensions until June 30, 1998

    8. Northeast, Pioneer, Hartington, and Jefferson, all rural LECs, 
request extensions of the switch conversion deadline until June 30, 
1998. Northeast and Hartington serve Nebraska, Pioneer serves Oklahoma, 
and Jefferson serves South Dakota.<SUP>23</SUP> Hartington and 
Jefferson assert that they do not provide Feature Group D equal access, 
because they have never received a request for equal 
access.<SUP>24</SUP> Northeast asserts that since April 15, 1997, it 
has provided equal access in three of its 12 exchanges, notwithstanding 
that it has never received a request for equal access.<SUP>25</SUP> 
Pioneer asserts that all of its 77 end offices were converted to equal 
access by May 1, 1996.<SUP>26</SUP> Pioneer asserts that 65 of its 
exchanges, serving approximately 86 percent of its access lines, are 
four-digit CIC capable.<SUP>27</SUP> Pioneer's extension request, 
therefore, applies to the 12 non-conforming exchanges.<SUP>28</SUP> 
Northeast asserts that the switching equipment providing equal access 
in each of the three exchanges is not four-digit CIC capable at this 
time.<SUP>29</SUP> Northeast, Hartington, and Jefferson all assert that 
no IXCs with four-digit CICs have shown an interest in serving their 
exchange areas.<SUP>30</SUP> Each argues that, even it were to receive 
a request for equal access, the market it serves is small and the 
company would be allowed three years after a bona fide request to begin 
providing equal access.<SUP>31</SUP> Northeast, Hartington and 
Jefferson all assert that, for these reasons, granting their waiver 
requests would not thwart the Commission's policy goal of expansion of 
competition in the interexchange market.<SUP>32</SUP> Northeast, 
Hartington, and Jefferson indicate that they have demonstrated an 
intent to implement four-digit CIC capability as soon as 
practicable.<SUP>33</SUP>
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    \23\ Northeast operates 4,120 access lines in twelve exchanges. 
See Northeast Petition at 2. Hartington operates 1,600 access lines 
serving 3,000 people. See Hartington Petition at 2. Pioneer serves 
approximately 50,000 access lines through 77 end offices. See 
Pioneer Petition at 2. Jefferson operates 550 access lines serving 
1,100 people. See Jefferson Petition at 2.
    \24\ Hartington asserts that it does not pass CICs in its 
signalling (Hartington Petition at 2 ) and that Hartington customers 
make long distance calls through Feature Group C dialing 
arrangements. If customers wish to use the services of an IXC other 
than AT&T for interLATA calls, they may use either a credit card 
service or Feature Group B dialing arrangement (Hartington Errata to 
Petition). Jefferson asserts that its customers connect with 
competing long distance carriers through Feature Group B and C 
dialing. See Jefferson Petition at 2.
    \25\ See Northeast Petition at 2. These three exchanges have a 
total of 1,149 access lines. See id.
    \26\ See Pioneer Petition at 2. Pioneer asserts that it began 
the equal access conversion process in 1991. Id.
    \27\ Id. at 3.
    \28\ Id. These exchanges are Apache, Arnett, Buffalo, Canton, 
Chester, Drummond, Fort Supply, Gage, Longdale, Quinlan, Shattuck, 
and Waynoka.
    \29\ See Northeast Petition at 2.
    \30\ See Northeast Petition at 5; Hartington Petition at 3-4; 
Jefferson Petition at 4.
    \31\ See Jefferson Petition at 5-6; Hartington Petition at 4; 
Jefferson Petition at 4. Jefferson also notes that this is 
particularly true given that IXCs have until June 30, 1998 to 
convert their own services to four-digit CICs. See Jefferson 
Petition at 5-6.
    \32\ See Northeast Petition at 5-6; Hartington Petition at 3-4; 
Jefferson Petition at 4.
    \33\ See Northeast Petition at 7; Hartington Petition at 5; 
Jefferson Petition at 6.
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    9. Northeast asserts that it began negotiations to replace 
switching equipment at its three equal access exchanges shortly after 
the Commission released the April 1997 CICs Second Report and 
Order.<SUP>34</SUP> Northeast asserts that, after months of 
negotiations, it ordered new, four-digit CIC capable, switching 
equipment for two of the exchanges in October 1997.<SUP>35</SUP> 
Northeast asserts that the equipment is scheduled to be delivered by 
mid-December 1997, and installed by mid-February 1998.<SUP>36</SUP> 
Northeast asserts that negotiations are ongoing for the third 
exchange.<SUP>37</SUP> Northeast asserts that for this exchange, it 
expects that the new, four-digit CIC compliant switch will be ordered 
shortly after Northeast's next board meeting on November 18, 1997, 
delivered in early 1998, and installed during the first quarter of 
1998.<SUP>38</SUP> Northeast also asserts that it interprets the recent 
CICs Order on Reconsideration and Second Further Notice of Proposed 
Rulemaking as not requiring Northeast to comply with the January 1, 
1998 conversion deadline, because it has never received a bona fide 
request for equal access.<SUP>39</SUP> Northeast asserts, therefore, 
that it may not need to request a waiver of the January 1, 1998 
conversion deadline, but states that it is doing so, out of an 
abundance of caution.<SUP>40</SUP>
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    \34\ See Northeast Petition at 2.
    \35\ See id. at 2-3.
    \36\ See id. at 3. Northeast asserts that installation of new 
switching equipment is a more complicated and lengthy process than 
installation of software upgrades. See id. at n.5.
    \37\ See id. at 3.
    \38\ See id.
    \39\ See id. at 3-4, citing CICs Order on Reconsideration at 
n.75 and CICs Second FNPRM at para. 84.
    \40\ See Northeast Petition at 4.
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    10. Pioneer asserts that grant of its request will allow Pioneer to 
complete its network reconfiguration and deploy new switch facilities 
in the most rational and efficient manner. This will, in turn, benefit 
its customers, who will be spared the costs of an abrupt change in 
Pioneer's plan.<SUP>41</SUP> Pioneer states that in January 1995, it 
began a series of network-wide equipment upgrades to bring new services 
to its customers, including the four-digit CIC function. Pioneer 
asserts that upon issuance of the CICs Second Report and Order, it 
accelerated its network conversion to four-digit CICs, a process it had 
anticipated being completed by the year 2000, under the originally 
proposed six-year transition.<SUP>42</SUP> Pioneer contends that its 
conversion process was delayed when an area code split was ordered, 
beginning on November 1, 1997, affecting 62 of its 77 
exchanges.<SUP>43</SUP> For the 12 exchanges for which it seeks an 
extension, Pioneer argues that it would be economically infeasible to 
meet the January 1, 1998 deadline.<SUP>44</SUP> After exploring all 
reasonable alternatives, Pioneer asserts that additional time is 
needed, until June 30, 1998, to convert these 12 exchanges. Pioneer 
notes that its request would ensure compliance when the permissive 
dialing period ends, and would, therefore, mean that the only IXCs 
affected by the grant of this waiver request would be those IXCs using 
new four-digit CICs.<SUP>45</SUP>
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    \41\ See Pioneer Petition at 9.
    \42\ See id. at 2-3.
    \43\ Id. at 3.
    \44\ Id. at 4.
    \45\ Id. at 4 and 9.
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    11. Hartington has entered into a contract with Nortel for the 
purchase of four-digit CIC compliant switching equipment, but claims 
that installation and testing of the new equipment may not occur until 
March 1998, at the earliest.<SUP>46</SUP> Like Clarks and Eustis/Home, 
Jefferson uses Nortel operating systems software release version 
403.31. Jefferson asserts that it discovered that to achieve four-digit 
CIC capability, an upgrade costing approximately $100,000 would be 
necessary.<SUP>47</SUP> Jefferson also notes that the company is in the 
process of being sold, and expresses concern about spending $100,000 on 
switching upgrades.<SUP>48</SUP>
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    \46\ See Hartington Petition at 2.
    \47\ See Jefferson Petition at 2 and n.3.
    \48\ Id. at 6.
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D. Request for Extension Until July 1, 1998

    12. Hartman, a small LEC <SUP>49</SUP> serving Nebraska that has 
provided equal access since 1995, requests an extension of the switch 
conversion deadline until July 1, 1998.<SUP>50</SUP> Hartman uses 
Nortel operating systems software release version 405.10, and argues 
that, to obtain four-digit CIC

[[Page 64762]]

capability, the company will need to upgrade this software and buy 
additional equipment.<SUP>51</SUP> Hartman asserts that, after months 
of negotiations, it has signed a contract with Nortel to upgrade to 
release 406.10, but argues that, because Nortel has been overwhelmed 
with upgrade requests, the delivery date for the upgrade is 
uncertain.<SUP>52</SUP> Hartman asserts that it has considered other 
manufacturers but has discovered that it would not be economical to 
purchase the equipment from them.<SUP>53</SUP> Like Pierce, Hartman 
refers to Commission precedent granting waivers when technical and 
economic burdens imposed on small and rural LECs in implementing 
software upgrades are demonstrated.<SUP>54</SUP>
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    \49\ Hartman operates 450 access lines serving three exchanges 
on the Nebraska/Kansas border. See Hartman Petition at 3.
    \50\ See id. at 1.
    \51\ See id. at 2-3.
    \52\ Id.
    \53\ See id.
    \54\ See id. at 4, citing Caller Id Order, cited at n.22, supra.
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E. Requests for Extension Until January 1, 2000

    13. Clarks, Eustis/Home, and Henderson each request a two-year 
extension of the switch conversion deadline, until January 1, 2000. 
Each is a small LEC <SUP>55</SUP> that currently is providing equal 
access.<SUP>56</SUP> Each asserts that compliance with the January 1, 
1998 conversion requirement is technically and economically infeasible 
because the operating system software needed to upgrade to four-digit 
CIC capability is not currently available and is very costly. None of 
the companies routinely performs upgrades to its Nortel switches, and 
each asserts that due to the large number of update requests, Nortel 
has a long waiting list of LECs seeking to obtain the new software 
releases.<SUP>57</SUP> Clarks and Eustis/Home both use Nortel operating 
systems software release version 403.31. They state that they have been 
considering upgrading to Nortel's operating systems software release 
version 410.10, but argue that the process is lengthy due to Nortel's 
long waiting list.<SUP>58</SUP> Eustis/Home asserts that it does not 
expect to receive the new release until mid-1998.<SUP>59</SUP> 
Henderson uses Nortel operating systems software release version 
402.52. Henderson asserts that it expects a mid-1998 implementation, 
based on contract negotiations with Nortel. Henderson notes, however, 
that if it decides to purchase new equipment from another manufacturer, 
implementation could take several more months.<SUP>60</SUP> Like Pierce 
and Hartman, Clarks, Eustis/Home, and Henderson refer to Commission 
precedent granting waivers when technical and economic burdens imposed 
on small and rural LECs in implementing software upgrades are 
demonstrated.<SUP>61</SUP>
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    \55\ Clarks and Henderson each serves 1000 access lines, and 
Eustis/Home combined serves 1300 access lines. See Clarks Petition 
at n.3; Henderson Petition at n.3; Eustis/Home Petition at n.3. 
Eustis and Home are commonly owned. See Eustis/Home Petition at 1.
    \56\ Clarks states that it has been providing equal access since 
1989. Eustis/Home and Henderson do not indicate when they began 
providing equal access.
    \57\ See Clarks Petition at 3; Eustis/Home Petition at 3.
    \58\ See Clarks Petition at 3; Eustis/Home Petition at 3.
    \59\ See Eustis/Home Petition at 3.
    \60\ See Henderson Petition at 3.
    \61\ See e.g., Clarks Petition at 4, citing Caller Id Order, 
cited at n.22, supra.
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    14. Clarks, Eustis/Home, and Henderson argue that to obtain four-
digit CIC capability, they must upgrade software or hardware and 
purchase additional equipment. Clarks notes that it is considering 
purchasing a new switch, which requires completion of RUS requirements, 
followed by installation of the equipment. The total process assertedly 
would take 18-20 months.<SUP>62</SUP> Eustis/Home also argues that 
switch replacement would take 18-20 months.<SUP>63</SUP> Henderson 
asserts that it is making good faith efforts to purchase an updated 
release, but argues that Nortel has refused to deal with Henderson 
using the RUS contract, and negotiations are taking 
months.<SUP>64</SUP> Eustis/Home and Henderson assert that they have 
also consulted with Stromburg-Carlson and Mitel about updated 
releases.<SUP>65</SUP>
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    \62\ See Clarks Petition at 3.
    \63\ See Eustis/Home Petition at 3.
    \64\ See Henderson Petition at 3.
    \65\ See Eustis/Home Petition at 3.
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III. Discussion

    15. The Commission may waive any provision of its rules, in whole 
or in part, if good cause is shown.<SUP>66</SUP> An applicant for 
waiver must demonstrate that special circumstances warrant a deviation 
from the general rule and that such deviation will serve the public 
interest.<SUP>67</SUP> In evaluating each petition for waiver before us 
here, we have weighed the following factors: the LEC's diligence in 
upgrading its switches; the availability from manufacturers of products 
required to accomplish the upgrade; and the impact of an extension of 
the conversion deadline on the IXCs served by the LEC's switches and on 
customers' ability to reach IXCs through CAC dialing.
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    \66\See 47 C.F.R. Sec. 1.3.
    \67\ Northeast Cellular Telephone Co. v. FCC, 897 F.2d 1164, 
1166 (D.C. Cir. 1990); WAIT Radio v. FCC, 418 F.2d 1153 (D.C. Cir. 
1969).
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    16. Requests for Extension of Hardy, Pierce, Northeast, Pioneer and 
Hartman. We find that the petitions for waiver filed by Hardy, Pierce, 
Northeast, Pioneer, and Hartman demonstrate the special circumstances 
meriting a waiver of the January 1, 1998 conversion deadline. First, 
each has demonstrated that it is diligently working to upgrade or 
replace its switches. For example, Hardy initiated the RUS process to 
deploy a new switch with the four-digit CIC capability in early 1997, 
when it learned that its switch vendor does not provide software 
upgrades to implement four-digit CICs capability. Pierce has been 
working to purchase four-digit CIC capable upgrades since May 1997, 
shortly following the release of the CICs Second Report and Order 
establishing the January 1, 1998 deadline for LEC conversion to four-
digit CICs. Similarly, Northeast states that it began negotiations to 
replace its switching equipment shortly after the release of the CICs 
Second Report and Order in April 1997. After months of negotiations, 
Northeast has now ordered new, four-digit CIC capable, switching 
equipment for two of its exchanges, expects to place an order for its 
third switch in November 1997, and anticipates installation of all of 
the required new equipment during the first quarter of 1998. Pioneer 
states that it began a series of network-wide equipment upgrades, that 
would include four-digit CIC capability, in January 1995 and 
accelerated that conversion following the release of the CICs Second 
Report and Order. Although its conversion process was delayed by an 
area code split, Pioneer requests an extension for only 12 of its 77 
exchanges and only until the end of the permissive dialing period on 
June 30, 1998. Hartman indicates that it is making good faith efforts 
to purchase updated software; indeed, Hartman states that it has signed 
a contract with Nortel for an upgraded operating systems software 
release.
    17. Second, based on their petitions, we conclude that Hardy, 
Pierce, Northeast, and Hartman have demonstrated that the product 
needed to accomplish the upgrade to their individual networks is not 
readily available from switch manufacturers, which has delayed their 
ability to meet the January 1, 1998 conversion deadline. In Hardy's 
case, Alcatel has notified it that it will not provide the software 
upgrades necessary to implement four-digit CIC capability. Thus, Hardy 
must select, purchase and deploy a new switch capable of providing the 
four-digit CIC function.

[[Page 64763]]

Pierce has been unable to obtain from Nortel the product necessary to 
upgrade its Nortel switches. Pierce estimates that upgrades can be 
operational, however, 180 days after a contract with Nortel is signed. 
Northeast maintains that replacement switching equipment was purchased 
only after months of negotiations. Hartman asserts that, because Nortel 
has been overwhelmed with upgrade requests, the delivery date for its 
upgrade is uncertain. In Pioneer's case, although it does not claim 
that replacement switching equipment is unavailable, we note that 
Pioneer also is replacing its switching equipment, rather than 
implementing an upgrade to its existing equipment. Thus, we conclude 
that the absence of this claim is not dispositive of its petition.
    18. Third, we conclude that the impact of an extension of the 
conversion deadline on the IXCs served by Hardy, Pierce, Northeast, 
Pioneer, and Hartman, and on the ability of those LECs' customers to 
reach IXCs through CAC dialing, does not outweigh the burden on the 
LECs that would be imposed by a denial of their petitions for waiver. 
Hardy, Pierce, Northeast, Pioneer, and Hartman are small, rural LECs 
serving a limited number of access lines. Hardy operates in West 
Virginia, serving 2,600 access lines. Pierce, a local exchange carrier 
in Nebraska, serves about 1,870 access lines. Northeast also operates 
in Nebraska, serving about 1,150 access lines. Hartman operates 450 
access lines serving three exchanges on the Nebraska/Kansas border. 
Pioneer operates in Oklahoma, and although it serves approximately 
50,000 access lines, only 14 percent of those access lines are affected 
by its request for an extension of the January 1, 1998 conversion 
deadline.<SUP>68</SUP> Hardy, Pierce, Northeast and Pioneer have not 
requested an extension of the conversion deadline beyond June 30, 1998. 
Accordingly, the grant of their requested waivers will not affect or 
interfere with the end of the permissive dialing period on June 30, 
1998. Hartman requests an extension of the conversion deadline until 
July 1, 1998, only one day after the end of the permissive dialing 
period. As explained below, we grant Hartman an extension until June 
30, 1998, which will not affect or interfere with the end of the 
permissive dialing period.
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    \68\ Pioneer states that currently 65 of its existing exchanges, 
serving approximately 86 percent of its access lines, are capable of 
providing the four-digit CIC function by the January 1, 1998 
deadline. See Pioneer Petition at 3.
---------------------------------------------------------------------------

    19. We recognize that the grant of these extensions will shorten or 
eliminate the time we provided for IXCs to prepare their networks and 
to educate their customers, in creating a two-step transition in our 
Order on Reconsideration. We find, however, that the technical and 
economic burden on these LECs that would be imposed by a denial of the 
extensions outweighs the burden to the IXCs and their customers. Each 
petitioner asserts that, even if it were technically feasible, it would 
suffer undue economic burden in attempting to meet the January 1, 1998 
conversion deadline. Further, the economic burdens imposed by a denial 
of the extensions would be borne by the LECs' customers. We note, 
moreover, that only IXCs that have been issued a four-digit CIC (who 
cannot currently receive CAC calls originating with the LECs' 
customers) will be affected by the grant of the waivers. The 
petitioners' networks can, and will continue to, accept CAC calling for 
IXCs with three-digit CICs until the transition ends on June 30, 1998. 
Although we recognize the potential anticompetitive effects of the 
dialing disparity and seek to minimize them, we believe that those 
effects are outweighed by the economic and technical burdens likely to 
be imposed on the LECs by a failure to extend the conversion deadline 
for them. Thus, on balance, we find that the impact of an extension of 
the conversion deadline on the IXCs served by Hardy, Pierce, Northeast, 
Pioneer, and Hartman, and on the ability of those LECs' customers to 
reach IXCs through CAC dialing, does not outweigh the burden on the 
LECs that would be imposed by a denial of the extension requests.
    20. We find that the conversion extension dates requested by Hardy 
and Pierce are reasonable. Hardy's and Pierce's requests for extensions 
until April 30, 1998, and May 1, 1998, respectively, allow for at least 
a brief period of time during which the IXCs served by these LEC 
switches can coordinate the conversion with them and can educate their 
customers about the necessary dialing changes.
    21. We also find the amount of additional time requested by 
Northeast and Pioneer, until June 30, 1998, to be reasonable. On June 
30, the permissive dialing period will end. We recognize that granting 
the extension until June 30, 1998, will effectively eliminate the 
benefits of the two-step transition created by the Commission in the 
CICs Order on Reconsideration for the IXCs served by these LECs' 
limited number of access lines. As noted above, we conclude, however, 
that the burden on the LECs that would be imposed by a denial of the 
extension outweighs the burden to IXCs and their customers. We reject 
Northeast's interpretation of the Commission's actions as requiring 
conversion by a LEC only if it is providing equal access in response to 
a request. The CICs Order on Reconsideration, in requiring that LECs 
providing equal access convert to four-digit CIC capability by January 
1, 1998, does not distinguish between those LECs providing equal access 
voluntarily and those providing it in response to a request. This is 
consistent with the Commission's requirement in the Independent 
Telephone Company Equal Access Report and Order,<SUP>69</SUP> issued 
over twelve years ago, that companies not receiving a request for equal 
access implement equal access as soon as practicable.<SUP>70</SUP>
---------------------------------------------------------------------------

    \69\ See In the Matter of MTS and WATS Market Structure Phase 
III, Report and Order, CC Docket No. 78-72, 100 F.C.C.2d 860 
(1985)(Independent Telephone Company Equal Access Order).
    \70\ See id. at para. 48, cited in CICs Second FNPRM at para. 
83.
---------------------------------------------------------------------------

    22. We also find that Hartman's request for an extension until July 
1, 1998, is generally reasonable. Because the permissive dialing period 
ends on June 30, 1998, we grant Hartman's request until that date, 
rather than until July 1, 1998, to avoid disruption to IXCs and to the 
public when the permissive dialing period ends on June 30, 1998.
    23. Requests for Extension of Clarks, Eustis/Home, and Henderson. 
We find that Clarks', Eustis/Home's, and Henderson's requested 
extensions, until January 1, 2000, are unreasonable. While we find that 
these LECs warrant an extension of the conversion deadline, we find 
that these LECs have failed to demonstrate the reasonableness of the 
amount of time they request, and to explain why, after seven months, a 
decision as to whether to replace their switches as a means of becoming 
four-digit CIC compliant has not been reached. As explained below, we 
grant extensions of the conversion deadline to Clarks, Eustis/Home, and 
Henderson, but only until June 30, 1998, which should be sufficient 
time for them to upgrade their switches.
    24. Clarks, Eustis/Home, and Henderson all argue that switch 
replacement may be necessary before their networks are four-digit CIC 
compliant. Both Clarks and Eustis/Home assert that if switch 
replacement is necessary, they would not be ready to convert for 18-20 
months. Henderson, while asserting that it could expect mid-1998 
implementation of a switch upgrade, asserts that implementation could 
take several more months if it decides to purchase new equipment from a 
different manufacturer. We

[[Page 64764]]

recognize, based on Hardy's experience, that if Clarks, Eustis/Home, 
and Henderson decide to replace their switches, which would involve the 
RUS funding approval process, the entire process could take as long as 
16 months.<SUP>71</SUP> Clarks, Eustis/Home, and Henderson have not yet 
decided, however, whether to pursue that course of action, instead of 
upgrading existing ones, as a means of becoming four-digit CIC 
compliant. None of these carriers, who assertedly began considering 
conversion options as early as April 1997, has explained why, after 
seven months, a decision as to whether to replace their switches, a 
process which they all assert is a lengthy one, has not been reached. 
Hardy states that it began the RUS process for deploying a new switch 
in early 1997, and asks for an extension until only April 30, 1998; 
Clarks, Eustis/Home, and Henderson, on the other hand, began 
considering options at most only three months later than Hardy, yet 
request extensions of two years, rather than four months, as requested 
by Hardy.
---------------------------------------------------------------------------

    \71\ If Hardy began this process on January 1, 1997, and is 
ready for implementation by April 30, 1998, the total amount of time 
required would be 16 months.
---------------------------------------------------------------------------

    25. Based on their petitions, we find that a more limited extension 
is warranted. Clarks, Eustis/Home, and Henderson warrant extensions of 
the conversion deadline to upgrade their switches because each has 
demonstrated diligence in pursuing switch upgrades, and the 
unavailability from manufacturers of products required to accomplish 
the upgrade. The impact of an extension on the IXCs served by them, and 
on the ability of those LECs' customers to reach IXCs through CAC 
dialing, does not outweigh the burden on the LECs that would be imposed 
in the absence of an extension.
    26. First, Clarks, Eustis/Home, and Henderson have demonstrated 
that they are diligently working to upgrade their switches. Each 
asserts that, upon issuance of the CICs Second Report and Order in 
April 1997, it began assessing the steps necessary to meet the January 
1, 1998 conversion deadline. Clarks currently is negotiating with 
Nortel regarding upgrade costs, for the updated operating system 
software necessary to accept four-digit CICs, and the equipment 
necessary to operate the software. Eustis/Home has been taking bids 
from several sources to obtain the fairest price for upgrades, and, in 
the past few months, has been communicating with vendors in addition to 
Nortel (such as Stromburg-Carlson and Mitel), regarding the purchase of 
software. Henderson is in the process of negotiations with Nortel 
regarding contract specifics for switch upgrades.
    27. Second, based on their petitions, we conclude that Clarks, 
Eustis/Home, and Henderson have demonstrated that the product needed to 
accomplish the upgrade to their individual networks is not readily 
available from switch manufacturers, delaying their ability to meet the 
January 1, 1998, conversion deadline. Each petitioner asserts that 
Nortel has informed it that Nortel has a long waiting list for 
upgrades. Eustis/Home is currently on the waiting list for an updated 
version of the operating system software, but cannot expect to receive 
it before mid-1998. Henderson also estimates a mid-1998 implementation, 
based on the assumption that, once a contract is signed, approximately 
180 days are needed for implementation.
    28. Third, we conclude that the impact of an extension of the 
conversion deadline on the IXCs served by Clarks, Eustis/Home, and 
Henderson, and on the ability of those LECs' customers to reach IXCs 
through CAC dialing, does not outweigh the burden on the LECs that 
would be imposed absent an extension. Clarks, Eustis/Home, and 
Henderson are small, rural LECs serving a limited number of access 
lines. Clarks and Henderson each serves 1000 access lines, and Eustis/
Home (which are commonly owned) combined serves 1300 access lines. 
Because, as discussed below, we are granting these LECs extensions only 
until June 30, 1998, the extensions will not affect or interfere with 
the end of the permissive dialing period on June 30, 1998.
    29. We find that, based on the record, an extension until June 30, 
1998, should provide sufficient time for Clarks, Eustis/Home, and 
Henderson to upgrade their existing switches. The burdens on IXCs and 
their customers of an extension beyond June 30, 1998, however, are much 
greater. An extension beyond that date will make it difficult for the 
IXCs served by them to educate their customers about the changes in 
dialing patterns and will affect the IXCs' customers' ability to reach 
them. The burdens imposed on IXCs and their customers of a longer 
extension outweigh any burdens that might be imposed on these LECs by 
our failure to extend the conversion deadline beyond June 30, 1998.
    30. Consistent with our desire to avoid requiring parties to incur 
inefficient cost expenditures, if Clarks, Eustis/Home, and Henderson, 
decide to replace their switches, we will consider further extension 
requests from them, provided they demonstrate that they have continued 
to work diligently towards conversion. Any party seeking a further 
extension should be prepared to provide detailed documentation of the 
steps taken, since issuance of this Order, to achieve switch conversion 
by June 30, 1998. Because a grant of a further extension, even for the 
slightest amount of time, will cause disruption to callers if all equal 
access LEC end offices are not converted to recognize four-digit CICs 
once the permissive dialing period has ended, we will scrutinize 
closely any request for a further extension. For this reason, we expect 
any further extension requests to be for the shortest amount of time 
practicable.
    31. Finally, we note that the CICs Order on Reconsideration, in 
addition to requiring four-digit CIC conversion by equal access LECs as 
of January 1, 1998, also requires that LECs must offer a standard 
intercept message beginning on or before June 30, 1998, explaining that 
a dialing pattern change has occurred and instructing the caller to 
contact its IXC for further information.<SUP>72</SUP> The Commission 
requires that, in developing an intercept message, LECs must consult 
with IXCs and reach agreement on the content of the message and on the 
period of time during which the message will be provided.<SUP>73</SUP> 
We emphasize that the LECs to whom we grant conversion extensions here 
must comply with the Commission's intercept message requirement.
---------------------------------------------------------------------------

    \72\ See CICs Order on Reconsideration at para. 26.
    \73\ See id.
---------------------------------------------------------------------------

    32. Requests for Extension of Hartington and Jefferson. Hartington 
and Jefferson both state that they do not provide equal access. As 
noted above, in the CICs Order on Reconsideration, the Commission 
modified the decision in the CICs Second Report and Order regarding the 
length of the transition during which three and four-digit Feature 
Group D CICs co-exist, and created a ``two-step'' end to the transition 
to four-digit CICs, with January 1, 1998, the end of the first phase, 
being the deadline for LECs providing equal access to complete switch 
changes to recognize four-digit CICs.
    33. In the CICs Second FNPRM, issued concurrently with the CICs 
Order on Reconsideration, the Commission, noting that some independent 
incumbent LECs in rural and isolated areas do not provide equal access, 
stated that a requirement that all LEC end office switches be upgraded 
to accept four-digit CICs by January 1, 1998, may have the unintended 
effect of requiring

[[Page 64765]]

those LECs that have never received a bona fide request for equal 
access or that are not subject to a specific timetable for providing 
equal access nonetheless to upgrade their end offices to offer equal 
access by January 1, 1998.<SUP>74</SUP> The Commission noted that such 
a requirement would modify the Commission's equal access implementation 
schedule for non-GTE independent telephone companies, set by the 1985 
Independent Telephone Company Equal Access Report and Order. As more 
than twelve years have passed since adoption of the Independent 
Telephone Company Equal Access Report and Order, the Commission, in the 
CICs Second FNPRM, tentatively concluded that eventually all LEC end 
offices should be required to provide equal access.<SUP>75</SUP> 
Because the CICs Order on Reconsideration requires January 1, 1998 
switch conversion to accommodate four-digit CICs only by those LECs 
providing equal access, however, and because Hartington and Jefferson 
are not providing equal access, we dismiss their petitions as moot.
---------------------------------------------------------------------------

    \74\ See CICs Second FNPRM at para. 84.
    \75\ Specifically, the CICs Second FNPRM tentatively concluded 
that (1) LECs with stored program-controlled (SPC) switches that 
have not received a bona fide request for equal access should be 
required to upgrade their facilities to provide equal access and to 
accept four-digit CICs within three years of the effective date of 
an Order adopted in this proceeding; and (2) LECs whose end offices 
are equipped with non-SPC switches should be required to provide 
equal access and to convert their switches to accept four-digit CICs 
when they next replace their switching facilities. See CICs Second 
FNPRM at para. 84.
---------------------------------------------------------------------------

IV. Ordering Clauses

    34. It is ordered, pursuant to Sec. 1.3 of the Commission's rules, 
47 CFR 1.3, and authority delegated in Sec. 0.91 of the Commission's 
rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's rules, 47 CFR 
0.291, that the Petition for Limited Waiver of Hardy Telecommunications 
Inc., is granted, by extending for it the switch conversion deadline 
for four-digit CIC capability until April 30, 1998.
    35. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Limited Waiver of Pierce 
Telephone Company, Inc., is granted, by extending for it the switch 
conversion deadline for four-digit CIC capability until May 1, 1998.
    36. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Waiver of Northeast Nebraska 
Telephone Company is granted, by extending for it the switch conversion 
deadline for four-digit CIC capability until June 30, 1998.
    37. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Limited Waiver of Pioneer 
Telephone Cooperative, Inc., is granted, by extending for it the switch 
conversion deadline for four-digit CIC capability until June 30, 1998.
    38. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Limited Waiver of Hartman 
Telephone Exchanges, Inc., is granted in part, by extending for it the 
switch conversion deadline for four-digit CIC capability until June 30, 
1998, and denied in part, to the extent Hartman requests extension 
beyond that date.
    39. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Limited Waiver of Clarks 
Telecommunications Co. is granted in part, by extending for it the 
switch conversion deadline for four-digit CIC capability until June 30, 
1998, and denied in part, to the extent Clarks requests extensions 
beyond that date.
    40. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Joint Petition for Limited Waiver of 
Eustis Telephone Exchange, Inc. and Home Telephone Company of Nebraska, 
is granted in part, by extending for them the switch conversion 
deadline for four-digit CIC capability until June 30, 1998, and denied 
in part, to the extent Eustis and Home request extension beyond that 
date.
    41. It is further ordered, pursuant to Sec. 1.3 of the Commission's 
rules, 47 CFR 1.3, and authority delegated in Sec. 0.91 of the 
Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the Commission's 
rules, 47 CFR 0.291, that the Petition for Limited Waiver of Henderson 
Telephone Company is granted in part, by extending for it the switch 
conversion deadline for four-digit CIC capability until June 30, 1998, 
and denied in part, to the extent Henderson requests extension beyond 
that date.
    42. It is further ordered, pursuant to authority delegated in 
Sec. 0.91 of the Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the 
Commission's rules, 47 CFR 0.291, that the Petition for Waiver of 
Hartington Telecommunications Co., Inc., is dismissed as moot.
    43. It is further ordered, pursuant to authority delegated in 
Sec. 0.91 of the Commission's rules, 47 CFR 0.91, and Sec. 0.291 of the 
Commission's rules, 47 CFR 0.291, that the Petition for Waiver of 
Jefferson Telephone Company is dismissed as moot.

Federal Communications Commission.
Geraldine A. Matise,
Chief, Network Services Division, Common Carrier Bureau.
[FR Doc. 97-32177 Filed 12-4-97; 4:03 pm]
BILLING CODE 6712-01-P