Opinion ID: 618656
Heading Depth: 3
Heading Rank: 6

Heading: Total Cable/Cable Size

Text: The Total Cable or Cable Size figure determines the total quantity of cables in a forward-looking, efficient, least-cost network. The cost of the cable is dependent on the size of the cable used; larger-sized cables, which carry more data, are less expensive to deploy than smaller cables. The higher the cost of cable, the higher the cost that PRTC can charge WorldNet under the ICA. Both PRTC and WorldNet asked the Board to consider the arbitrator's initial decision on this figure. The Board requested additional submissions from both sides and then issued its own figure, which PRTC challenges. Because the Board issued its own figure, we examine whether the Board's determination was arbitrary and capricious. PRTC argues that under FCC rules, forward-looking cost models must estimate the cost of providing service for all businesses and households within a geographic region. See In re Federal-State Joint Bd. on Universal Serv. ( Universal Service First Report and Order ), 12 FCC Rcd. 8776, 8912-16, 1997 WL 236383 (1997). PRTC contends that the Board's methodology failed to meet this requirement because it resulted in a total cable figure that is not sufficient to serve all of Puerto Rico. However, WorldNet and the Board counter that PRTC's position regarding the amount of cable required to cover Puerto Rico was based on flawed assumptions. WorldNet notes that many parts of Puerto Rico are mountainous or sparsely populated and thus require little or no cable. PRTC's proposal to the Board did not account for this, and was thus unrealistically high. PRTC had also contended that the amount of cable it currently uses should have been a sanity check for determining if the Board's calculation was correct, and it noted that the total length of cable under the Board's calculation was only roughly one third of the present amount. However, the Board argues that because the Act requires a forward-looking estimate based on the most efficient network, it would not have been appropriate to rely on the current cable length figure as a benchmark. Thus, there was nothing arbitrary or capricious about the Board's rejection of PRTC's proposal. [23] Furthermore, there was nothing arbitrary or capricious in the approach the Board adopted. PRTC's proposal included a simplifying assumption that the width of the cable would decrease at a steady rate along the path between PRTC's central offices and the customers. The Board held that this assumption was not necessary and instructed PRTC to provide a cost study module for cable sizes and investment that does not include the unnecessary simplifying assumptions in this matter, to which WorldNet would be allowed to respond. However, PRTC did not provide any new data to the Board. The Board ultimately settled on a modified WorldNet approach that eliminated both sides' simplifying assumptions. Given that the Board requested additional studies and briefing, and carefully considered both parties' models before adopting a hybrid approach, the Board's reasoned determination did not lack a rational basis and was thus not arbitrary and capricious.