[Federal Register Volume 63, Number 92 (Wednesday, May 13, 1998)]
[Rules and Regulations]
[Pages 26495-26497]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-12346]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 69

[CC Docket 96-128; DA 98-701]


Implementation of the Pay Telephone Reclassification and 
Compensation Provisions of the Telecommunications Act of 1996; AT&T 
Request for Limited Waiver of the Per-Call Compensation Obligation

AGENCY: Federal Communications Commission.

ACTION: Final rule; clarification and waivers.

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SUMMARY: The Common Carrier Bureau adopted an Order (``Order''), which 
clarifies certain requirements set forth in the Per-phone Compensation 
Waiver Order. The Order clarifies the following: the data to be used 
for the payment of payphone compensation for the fourth quarter of 1997 
and first quarter of 1998 for payphones that are not capable of 
providing payphone-specific coding digits; the method for allocating 
among payors the payphone compensation requirements for payphones 
served by non-equal access switches; and the eligibility of payphones 
on automatic number identification (``ANI'') lists.

DATES: Effective April 10, 1998.

FOR FURTHER INFORMATION CONTACT: Rose Crellin, Formal Complaints and 
Investigations Branch, Enforcement Division, Common Carrier Bureau, 
(202) 418-0960.

SUPPLEMENTARY INFORMATION: This is a summary of the Bureau's Order in 
CC Docket No. 96-128 [DA 98-701], adopted on April 10, 1998, and 
released on April 10, 1998. The full text of the Order is available for 
inspection and copying during normal business hours in the FCC 
Reference Center, Room 239, 1919 M Street, N.W., Washington, D.C. The 
complete text of this decision also may be purchased from the 
Commission's duplicating contractor, International Transcription 
Services, 1231 20th Street, N.W., Washington, D.C. 20036.

SUMMARY OF ORDER

Introduction

    1. In the Order, the Bureau clarifies certain requirements set 
forth in the Per-phone Compensation Waiver Order,<SUP>1</SUP> published 
elsewhere in this issue of the Federal Register, which was adopted on 
April 3, 1998, by the Common Carrier Bureau (``Bureau''). The Per-phone 
Compensation Waiver Order granted interexchange carriers (``IXCs'') a 
limited waiver of the payphone compensation requirements set forth in 
the Payphone Orders <SUP>2</SUP> to enable IXCs to pay to payphone 
service providers (``PSPs'') per-phone instead of per-call compensation 
for subscriber 800 and access code calls originated from payphones when 
payphone-specific coding digits <SUP>3</SUP> are not available from 
those payphones. The Bureau's Order clarifies the following: (1) The 
data to be used for the payment of payphone compensation for the fourth 
quarter of 1997 and first quarter of 1998 for payphones that are not 
capable of providing payphone-specific coding digits; (2) the method 
for allocating among payors the payphone compensation requirements for 
payphones served by non-equal access switches; and (3) the eligibility 
of payphones on automatic number identification (``ANI'') lists.
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    \1\ Implementation of the Pay Telephone Reclassification and 
Compensation Provisions of the Telecommunications Act of 1996, 
Memorandum Opinion and Order, DA 98-642 (rel. Apr. 3, 1998) (``Per-
phone Compensation Waiver Order'').
    \2\ Implementation of the Pay Telephone Reclassification and 
Compensation Provisions of the Telecommunications Act of 1996, CC 
Docket No. 96-128, Report and Order, 61 FR 52307 (October 7, 1996) 
(``Report and Order''); Order on Reconsideration, 61 FR 65341 
(December 12, 1996) (``Order on Reconsideration'') (together the 
``Payphone Orders''). The Payphone Orders were affirmed in part and 
vacated in part. See Illinois Public Telecomm. Ass'n v. FCC, 117 
F.3d 555 (D.C. Cir. 1997) (``Illinois Public Telecomm.''); see also 
Second Report and Order, 13 FCC Rcd 1778 (1997) (``Second Report and 
Order''), pets. for recon. pending, review pending, MCI Telecomm. 
Corp. v. FCC, D.C. Circuit No. 97-1675 (filed Nov. 7, 1997); Sprint 
Corp. v. FCC, D.C. Circuit No. 97-1685 (filed Nov. 13, 1997); 
Personal Communications Industry Association v. FCC, D.C. Circuit 
No. 97-1709 (filed Dec. 1, 1997); Illinois Public Telecommunications 
Association v. FCC, D.C. Circuit No. 97-1713 (filed Dec. 3, 1997).
    \3\ Payphone-specific coding digits provide a method for LECs to 
transmit, with the automatic number identification (ANI), 
information (coding number or digits) identifying a call as having 
been placed specifically from a payphone. Order on Reconsideration, 
11 FCC Rcd 21,265-66, para. 64. See Implementation of the Pay 
Telephone Reclassification and Compensation Provisions of the 
Telecommunications Act of 1996, Memorandum Opinion and Order, CC 
Docket No. 96-128, DA 98-481 (rel. Mar. 9, 1998) 63 FR 20534 (April 
27, 1998) (``Bureau Coding Digit Waiver Order'').
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II. Background

    2. In the Per-phone Compensation Waiver Order, the Bureau concluded 
that the waiver granted therein to allow IXCs to pay per-phone 
compensation when payphone-specific coding digits are not available 
from a payphone is necessary to ensure that PSPs receive fair 
compensation while local exchange carriers (``LECs''), PSPs, and IXCs 
transition to providing and receiving payphone-specific coding digits 
to identify calls from payphones.
    3. Previously, the Bureau had adopted the Bureau Coding Digit 
Waiver Order clarifying the payphone-specific coding digit requirements 
set forth in the Payphone Orders and granting limited waivers of the 
requirement that LECs provide payphone-specific-coding digits to PSPs, 
and that PSPs provide payphone-specific coding digits from their 
payphones to IXCs, before PSPs can receive per-call compensation from 
IXCs for subscriber 800 and access code calls. The Bureau explained in 
the Per-phone Compensation Waiver Order that the order serves as a 
companion order to the Bureau Coding Digit Waiver Order, because in the 
Per-phone Compensation Waiver Order, the Bureau granted IXCs 
<SUP>4</SUP> a waiver of the per-call compensation requirement so they 
may pay per-phone instead of per-call

[[Page 26496]]

compensation for the payphones for which the Bureau granted waivers in 
the Bureau Waiver Order <SUP>5</SUP> and the Bureau Coding Digit Waiver 
Order.
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    \4\ For purposes of paying compensation for compensable calls 
and other associated obligations, such as tracking calls, we note 
that the term ``IXC'' includes an LEC when it provides interstate, 
intraLATA toll service. See Report and Order, 61 FR 52307 (October 
7, 1996); Order on Reconsideration, 11 FCC Rcd at 21,270, paras. 74-
75 & 21,278, para. 92. Carriers required to pay per-call 
compensation pursuant to the Payphone Orders also are referred to as 
``payors'' in this order.
    \5\ Implementation of the Pay Telephone Reclassification and 
Compensation Provisions of the Telecommunications Act of 1996, 62 FR 
58659, (October 30, 1997) (``Bureau Waiver Order'').
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III. Discussion

A. Payphone Compensation Payments

    4. The Bureau Coding Digit Waiver Order required that payments for 
payphone compensation be remitted at least on a quarterly basis. That 
order required that the payment for the October 1997 through December 
31, 1997 period be paid no later than April 1, 1998. The Bureau stated 
in the Per-phone Waiver Order that because some IXCs will have to 
obtain additional information and calculate their per-phone 
compensation amounts, these IXCs may need additional time to make the 
payments to PSPs for the October 1997 through December 31, 1997 period 
for payphone compensation. Thus, the order stated that IXCs may make 
this payment no later than April 30, 1998, but must include additional 
interest for the period after April 1, 1998, at the rate of 11.25 
percent simple interest per year, if the payment was not made by April 
1, 1998.
    5. In the Per-phone Waiver Order, the Bureau required that pursuant 
to the waiver granted therein, with the exception of the compensation 
method for those payphones that are able to provide payphone-specific 
coding digits, IXCs must use call volume information obtained from 
October 1997 through March 31, 1998 (the ``sample period''), to 
establish average subscriber 800 and access code call volumes per-phone 
to compensate PSPs for calls originated from their payphones during the 
fourth quarter of 1997 and the first quarter of 1998 (from October 7, 
1997 through March 31, 1998). In the Order, the Bureau clarifies that 
if calculating the average call volumes using the six-month ``sample 
period'' of data will delay payment for the fourth quarter of 1997 
beyond the deadline set forth in that order, IXCs must compensate PSPs 
for the fourth quarter of 1997 based on data from the fourth quarter of 
1997, and compensate PSPs for the first quarter of 1998 based on data 
from the first quarter of 1998 using the same methodology specified in 
the Per-phone Waiver Order but revised to accommodate a three-month 
rather than a six-month period of call volume and payphone information.

B. Payphone Compensation for Payphones Served by Non-Equal Access 
Switches

    6. In the Per-phone Waiver Order, the Bureau stated that payphones 
served by non-equal access switches must be compensated for 16 calls 
per-phone per month, until payphone-specific coding digits are 
available for those payphones. Because the number of payphones on non-
equal access switches and the number of calls for which such payphones 
should be compensated is small, the Bureau finds it is appropriate to 
allocate compensation obligations for these payphones among payors in a 
different manner than other payphones. Therefore, per-phone 
compensation for PSP payphones served by non-equal access switches will 
be based on call distribution data submitted to the Commission by the 
LEC Coalition. The LEC Coalition provided data from three Bell 
Operating Companies (``BOCs'') in an aggregated form illustrating the 
average calls per-phone per month, and the percentage of average calls 
per month of the total calls received by each payor. The Bureau finds, 
however, compensation due to PSP payphones served by non-equal access 
switches should be allocated among the top ten carriers receiving the 
highest amount of subscriber 800 and access code calls as indicated by 
the LEC Coalition data, because the number of calls for which 
compensation is due is so small. Were the Bureau to require all 
carriers to compensate payphones served by non-equal access switches, 
many carriers would be forced to compensate PSPs for mere fractions of 
calls.
    7. Therefore, to compensate PSPs for payphones served by non-equal 
access switches, each IXC listed in the Order will multiply its 
percentage of average calls per month total as stated in the LEC 
Coalition data by 16 calls per-phone per month.\6\ That number is the 
average number of calls for which that carrier must compensate the PSP 
for payphones served by non-equal access switches. That number will 
then be multiplied by three, to determine the quarterly call volume, 
and then by $0.284 to determine the amount owed.
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    \6\ The LEC Coalition data indicates the following percentage 
allocation: (1) AT&T: 37.08%; (2) MCI: 25.33%; (3) WorldCom: 12.17%; 
(4) Sprint: 10.76%; (5) LCI: 2.83%; (6) Frontier: 2.75%; (7) BOC 
weighted average: 2.19%; (8) Allnet Dial 1 Service: 1.14%; (9) Cable 
& Wireless: 0.95%; (10) Switched Services: 0.63%. Id.
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    8. The Bureau finds that the LEC Coalition data is an appropriate 
basis upon which to allocate compensation for payphones served by non-
equal access switches because the compensation due is small. 
Notwithstanding the Bureau's decision in the Per-phone Waiver Order 
that this data is not appropriate to assess compensation obligations 
for all payphones, here this data is representative of the number of 
compensable calls made from payphones on non-equal access switches and 
is appropriate for allocating each carrier's share of compensation 
obligations. Therefore, the concerns raised in reference to using this 
data as a compensation method for all payphones are not present here.

C. Payphones on the ANI List

    9. In the Per-phone Waiver Order, the Bureau stated that payphones 
can receive compensation only for those months that they were in 
service. The Bureau Waiver Order stated that payphones appearing on the 
LEC-provided lists of payphones are eligible for per-call compensation 
even if they do not transmit payphone-specific coding digits. The 
Bureau clarifies that as stated in the Bureau Waiver Order, for 
payphones that do not provide payphone-specific coding digits, payors 
must look to the ANI lists to determine which payphones \7\ are 
eligible for compensation. Prior to the Bureau Coding Digit Waiver 
Order, LECs were required to provide ANI lists on a quarterly basis. 
That order required that LECs make available on request monthly ANI 
lists. Thus, for the fourth quarter of 1997 and the first quarter of 
1998, payors must use quarterly ANI lists. Thereafter, payors must use 
the monthly ANI lists that payors can obtain from LECs. If there are 
disputes between IXCs and PSPs regarding whether certain payphones were 
in service during a specific period even if they are on the ANI lists, 
such disputes should not be a basis for delay of payphone compensation 
payments.
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    \7\ Bureau Waiver Order, 12 FCC Rcd at 16,390-91, paras. 9-14.
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IV. Conclusion and Ordering Clauses

    10. The Bureau concluded in the Order that the clarifications to 
the Per-phone Compensation Waiver Order are in the public interest, 
because they will further the goals of Section 276 of the Act, and that 
PSPs should be compensated for each and every completed call and will 
ease the transition to per-call compensation.
    11. Accordingly, pursuant to authority contained in Sections 1, 4, 
201-205, 218, 226, and 276 of the Communications Act of 1934, as 
amended, 47 U.S.C. 151, 154, 201-205, 218, 226, and 276, and the 
authority delegated by Secs. 0.91 and 0.291 of the

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Commission's rules, 47 C.F.R. 0.91, 0.291, the policies and 
requirements set forth in the payphone proceeding and the Per-phone 
Compensation Waiver Order are clarified.

Federal Communications Commission.
Robert W. Spangler,
Acting Chief, Enforcement Division, Common Carrier Bureau.
[FR Doc. 98-12346 Filed 5-12-98; 8:45 am]
BILLING CODE 6712-01-U