Opinion ID: 698322
Heading Depth: 2
Heading Rank: 2

Heading: Enhanced Service Providers

Text: 5 The Commission defines enhanced services as 6 services, offered over common carrier transmission facilities used in interstate commerce, which employ computer processing applications that act on the format, content, code, protocol or similar aspects of the subscriber's transmitted information; provide the subscriber additional, different, or restructured information; or involve subscriber interaction with stored information. 7 47 C.F.R. Sec. 64.702(a). In simpler terms, an ESP offers data processing services that use the telephone network to transmit information among customers and computers. California v. FCC, 905 F.2d 1217, 1223 n. 3 (9th Cir.1990). Familiar examples of enhanced services include [d]atabase services, in which a customer dials a number to obtain access to stored information, such as Dow Jones News, Lexis, and 'Dial It' sports scores.... Id. 8 Because the BOCs both provide enhanced services themselves and provide local access to other ESPs, the Commission has long been concerned that a BOC might seek to maintain an advantage over competing ESPs by discriminating against them in the provision of local access services. See Policy and Rules Concerning the Furnishing of Customer Premises Equipment, Enhanced Services and Cellular Communications Services by the Bell Operating Companies, Report and Order, CC Docket No. 83-115, 95 FCC 2d 1117, 1132-37 (1983). Initially the Commission relied upon a structural safeguard--the requirement that each BOC offer enhanced services only through a separate subsidiary--in order to preclude such discrimination. Id. at 1120-21. In 1986, however, the Commission repealed the separate subsidiary requirement and promulgated non-structural safeguards against discrimination in access to the local exchange, including a requirement that for each enhanced service a BOC offers it provide a comparably efficient interconnection (CEI) to competing ESPs. Amendment of Section 64.702 of the Commission's Rules and Regulations (Third Computer Inquiry), Report and Order, CC Docket No. 85-229,104 FCC 2d 958, 1018-28 (1986) (Computer III Order ). 9 At the same time, the Commission noted that several commenters had suggested that service-by-service CEI plans could be avoided if the FCC were instead to require that each BOC develop an open network architecture (ONA); this would entail each BOC breaking its access service down into its component parts and offering each so-called basic service element (BSE) separately and upon an equal basis to all ESPs (including, for regulatory accounting purposes, itself). Id. at 1059-68. The FCC agreed with this approach, which it thought could both prevent the BOCs from discriminating in the provision of local access and make access for ESPs more efficient. Id. at 1063-64. Hence, the Commission set general guidelines for ONA and required each BOC to file an ONA plan setting forth the BSEs it would initially offer. Id. at 1064-68. Moreover, the Commission required each BOC to allow other ESPs to participate in the development of its ONA offerings in order to decrease the potential for possible discrimination by the [BOC] in designing [BSEs]. Id. at 1065-66. 10 MCI and the Commission agree that the BSEs in the ONA plans originally submitted by the BOCs were primarily just the unbundled components of the services that the BOCs were already offering. The Commission approved those plans in substantial part but required some augmentation; in particular, it directed each BOC to review each other BOC's proposals for additional unbundling ideas and to develop plans for the application of ONA principles to new technologies, such as ISDN (Integrated Services Digital Network). Filing and Review of Open Network Architecture Plans, Memorandum Opinion and Order, CC Docket No. 88-2, 4 FCC Rcd 1, 10-17 (1988) (BOC ONA Order ). The Commission later approved the ONA filings as thus amended, and refused various requests that it require more fundamental unbundling. Filing and Review of Open Network Architecture Plans, Memorandum and Opinion on Reconsideration, CC Docket No. 88-2, 5 FCC Rcd 3084 (1990) (BOC ONA Reconsideration Order ); Filing and Review of Open Network Architecture Plans, Memorandum Opinion and Order, CC Docket No. 88-2, 5 FCC Rcd 3103 (1990) (BOC ONA Amendments Order ). (Shortly after the Commission had approved the amended ONA filings, the Ninth Circuit vacated the FCC's Computer III decision, California v. FCC, 905 F.2d 1217 (9th Cir.1990), but on remand the FCC reinstated the ONA requirements that it had placed upon the BOCs in the Third Computer Inquiry and reaffirmed its earlier approval of the BOCs' amended ONA proposals. See Computer III Remand Proceedings, Report and Order, CC Docket No. 90-368, 5 FCC Rcd 7719, 7720 (1990).)