Opinion ID: 757345
Heading Depth: 1
Heading Rank: 1

Heading: The BellSouth Petitioners

Text: 4 The BellSouth petitioners contend that the Order violates 47 U.S.C.A. § 254 (WEST SUPP.1998) (1) 3 by failing immediately to remove all implicit subsidies 4 from interstate access charges, in contravention of the requirement that the mechanisms to implement universal service support be specific [and] predictable, 47 U.S.C.A. § 254(b)(5); (2) by neglecting to protect the implicit universal service support subsidies encompassed within interstate access charges from competition until a new universal service support regime is operational, in contravention of the requirement that the mechanisms to implement universal service support be sufficient, id.; and (3) by continuing to impose on incumbent LECs, but not new entrants into the local exchange market, the obligation to support universal service through interstate access charges, in contravention of the requirement that contributions be nondiscriminatory, id. § 254(b)(4). The FCC's actions, according to the BellSouth petitioners, will prevent LECs from recovering the costs of universal service support traditionally included as implicit subsidies within interstate access charges and will unfairly burden incumbent LECs with the costs of universal service support while exempting new entrants into the market from bearing their share of these costs.
5 The BellSouth petitioners first argue that the Commission's Order violates the statutory mandate of § 254 that all mechanisms to preserve and advance universal service subsidies be specific and predictable. Id. § 254(b)(5). By delaying the implementation of a new regime of explicit universal service subsidies until at least January 1, 1999, 5 while at the same time promoting immediate competition in the local exchange market as a means of bringing access charges more closely in line with actual costs, the BellSouth petitioners contend that the FCC has ensured that universal service support subsidies will be detrimentally deflated to such an extent that they will cease to serve their purpose. 6 The FCC replies that changes to interstate access charges made in the Order are well within the discretionary authority granted to the Commission by Congress to implement the policies of the 1996 Act, including the promotion of competition in the local exchange market, the elimination of implicit universal service support subsidies, and the preservation of universal service. The Commission argues specifically that its decision to open local exchange markets to competition in compliance with 47 U.S.C.A. § 251(d) (requiring completion by August 1996 of regulations to implement market opening provisions) prior to the full implementation of a new, explicit regime of universal service support pursuant to § 254, is permissible under the 1996 Act. By its specific language, the Act contemplates sequential implementation of, initially, the market opening provisions of § 251, followed by the new explicit universal service support mechanisms of § 254. The decision to promote competition in the local exchange market prior to the enactment of a new universal support mechanism is therefore reasonable, according to the FCC. 7 We agree that the FCC's decision to adjust the computation of interstate access charges to eliminate implicit subsidies and promote competition in the local exchange market before an explicit universal service support mechanism is fully operational is reasonable in light of the specific language of the 1996 Act. Section 251(d)(1) required the Commission to adopt rules implementing the market opening provisions by August 1996. Section 254(a)(2), however, did not require the FCC to adopt universal service rules until May 1997. See id. (The Commission shall initiate a single proceeding to implement the recommendations from the [the Federal-State] Joint Board [on universal service] ... and shall complete such proceeding within 15 months after February 8, 1996.). The Act does not require that the rules promulgated under § 254 immediately implement a new, explicit universal service support mechanism. Rather, the rules enacted by the FCC must establish a specific timetable for implementation. Id. By establishing an explicit universal service support regime in the In re Federal-State Joint Board on Universal Service, First Report and Order (CC Docket No. 96-45), FCC 97-157, 12 FCC Rcd No. 16 8776 (released May 8, 1997)[hereinafter Universal Service Order ], petitions for review pending, Texas Office of Public Utility Counsel v. FCC, 5th Cir. No. 97-60421, that will be fully operational by January 1999, the Commission has proceeded in a manner contemplated by the Act. The Commission has made a predictive judgment, based on evidence in the record and adequately explained in the Order, that competitive pressures in the local exchange market will not threaten universal service during the interim period until the permanent, explicit universal service support mechanism has been fully implemented. See City of St. Louis, 936 F.2d at 1534 (Such forecasts must be accepted 'if they are rational, based on a consideration of all the relevant factors, and adequately explained.' ) (citations to quoted cases omitted). 8 The Commission's decision to promote competition in the local exchange market and eliminate implicit subsidies embedded in interstate access charges prior to the full implementation of a new, explicit mechanism for universal service support does not violate the provisions of the 1996 Act, nor does it represent an unreasonable interpretation of the Act.
9 The BellSouth petitioners further argue that the FCC, in addition to delaying impermissibly the implementation of an explicit universal service support mechanism, has created new implicit subsidies in violation of the 1996 Act while, at the same time, exposing these subsidies to competitive forces that will render them ineffective. 10 The BellSouth petitioners first take issue with the FCC's decision to maintain the flat-rated (as opposed to per-minute) subscriber line charge (SLC) ceiling of $3.50 per month on primary residential lines while increasing the SLC ceiling for both non-primary residential lines and multi-line business lines. See Order p 78 (raising the multi-line business line SLC ceiling to $9.00 per month and allowing an increase of up to $1.50 per month in the non-primary residential line SLC ceiling beginning January 1, 1998 with additional phased-in increases in the future). According to the BellSouth petitioners, preserving the current SLC cap on primary residential lines prevents LECs from recovering the costs associated with serving those lines, while increasing the SLC cap on non-primary and multi-line business lines above actual cost forces users of these lines to subsidize expenses associated with the under-funded primary residential lines. The ultimate result of these changes is the creation of a new, implicit subsidy funded by the increased rate ceilings on customers with non-primary residential or multi-line business lines and benefiting customers with only primary residential lines. This, according to the BellSouth petitioners, is in direct contravention of § 254's directive that support for universal service be explicit. 47 U.S.C.A. § 254(e). 11 We cannot agree that the FCC's decisions to increase SLCs on non-primary residential and multi-line business lines and to maintain the current ceiling on primary residential lines are in violation of the 1996 Act. The Commission, relying on recommendations from the Federal-State Universal Service Joint Board 6 [hereinafter Joint Board], justifiably determined that an increase in the SLC ceiling for primary residential lines would threaten universal service in ways that an increase in the SLC ceiling for non-primary residential and multi-line business lines simply would not. See Order p 70 (noting Joint Board's conclusion that the SLC ... has an impact on universal service concerns such as affordability and its recommendation that the Commission leave the current SLC ceilings in place for primary residential and single-line business lines). The courts have recognized that universal service concerns are valid justifications for FCC action. See, e.g., Competitive Telecomms. Ass'n v. FCC, 117 F.3d 1068, 1074 (8th Cir.1997); Rural Tel. Coalition v. FCC, 838 F.2d 1307, 1315 (D.C.Cir.1988); National Ass'n of Regulatory Util. Comm'rs v. FCC, 737 F.2d 1095, 1108 (D.C.Cir.1984), cert. denied, 469 U.S. 1227, 105 S.Ct. 1224, 84 L.Ed.2d 364 (1985). While the FCC acknowledges that its decisions regarding SLC ceilings will require customers with multiple telephone lines to contribute, for a limited period, to the recovery of common line costs that incumbent LECs incur to serve single-line customers, Order p 101 (emphasis added), we note that this temporary, transitional arrangement is not an unreasonable solution to the implicit tension between the FCC's goals of moving toward cost-based rates and protecting universal service, see Competitive Telecomms., 117 F.3d at 1073-74 (Although temporary agency rules are subject to judicial review notwithstanding their transitory nature, 'substantial deference by courts is accorded to an agency when the issue concerns interim relief.' ) (quoting MCI Telecomms. Corp. v. FCC, 750 F.2d 135, 140 (D.C.Cir.1984)); City of St. Louis, 936 F.2d at 1543 ([T]he weighing of one public-interest factor against another is preeminently a function for an expert agency, not a court.). 12 Furthermore, as the FCC points out, the decision to retain the $3.50 per month SLC ceiling on primary residential lines was made in conjunction with the introduction of a flat-rated presubscribed interexchange carrier charge (PICC), assessed directly on IXCs rather than on users to recoup costs not covered by the SLC, that will increase incrementally until the SLC and PICC combined recover all costs associated with primary residential lines. See Order paras. 94, 99 (imposing PICC on primary residential and single-line business lines at a maximum of $0.53 per month, on non-primary residential lines at a maximum of $1.50 per month, and on multiple business lines at a maximum of $2.75 per month). Upon completion of the Commission's phased-in plan of PICC ceiling increases on primary residential lines (combined with corresponding PICC cap decreases on multi-line business lines), the aggregate flat-rated charges (the combination of both SLC and PICC) imposed upon primary residential lines will be the same per line as those imposed upon multi-line business lines. See id. p 102. 13 For the reasons stated, we conclude that the FCC's decision to maintain the current SLC ceiling on primary residential lines does not amount to the creation of a new implicit subsidy for the benefit of primary residential line customers and to the detriment of non-primary line and multi-line business line customers, in violation of § 254's direction that subsidies be explicit.
14 Both the BellSouth petitioners and the Bell Atlantic parties challenge the FCC's actions with respect to the imposition of per-minute charges on originating access minutes. They contend that the requirement to recoup non-traffic-sensitive costs not fully recovered under the flat-rated SLC and PICC price ceilings by applying a per-minute access carrier common line charge (CCLC) and a per-minute residual transport interconnection charge (TIC) assessed on originating access minutes (charges imposed on carriers for outgoing calls), rather than on terminating access minutes, is in violation of the 1996 Act. They argue that the higher degree of competition for originating access minutes will prevent them from imposing the CCLC or the TIC to recoup costs lest they risk losing customers to competitors who can undercut their prices. This approach, according to the BellSouth petitioners, is inherently discriminatory--it places a disproportionate burden of paying for universal service support on incumbent LECs in violation of the Act. See 47 U.S.C.A. § 254(b)(4) (All providers of telecommunications services should make an equitable and nondiscriminatory contribution to ... universal service.). Furthermore, the BellSouth petitioners and the Bell Atlantic parties argue, the Commission's decision to employ a per-minute charge to recover non-traffic-sensitive, or flat, costs is contrary to the agency's stated goal of imposing access charges in a cost-causative manner--in a way that reflects the way the costs are incurred. Order passim. 15 The Commission defends its decision to allow recovery of non-traffic-sensitive residual costs through per-minute access charges as an interim solution that will be phased out as flat-rated PICC caps increase to allow for such recovery. See id. p 102. Prior to the changes implemented in the Order, these residual costs were recovered through per-minute charges assessed on both originating and terminating access minutes. The Commission, realizing that greater competition would exist for provision of originating rather than terminating access minutes, determined that recovery of these residual costs on originating minutes would promote the agency's objective of allowing the marketplace to move LECs' access rates toward competitive levels. See id. p 100. The decision to continue employing a traffic-sensitive mechanism to recover these non-traffic-sensitive costs is justified by universal service concerns. Until flat-rated PICC ceilings rise sufficiently over time to allow recovery of these residual, non-traffic-sensitive costs, the FCC has opted to maintain the non-cost-causative, per-minute charges that, in addition to permitting recovery of otherwise lost residual costs, have the added advantage of promoting Congress's goal of moving access rates toward competitive levels. As the Commission points out, a phased-in transition from non-cost-causative per-minute rates to cost-causative flat rates has been adopted in the Order. 16 We find that the Commission's decision to impose the residual per-minute CCLC and TIC on originating, rather than terminating, access minutes is not in violation of the 1996 Act. This transitional solution is a reasonable exercise of the Commission's discretionary authority to balance competing statutory goals. See National Ass'n of Regulatory Util. Comm'rs, 737 F.2d at 1134 (noting that FCC has broad statutory discretion to balance the multiple goals embodied in the Communications Act). Rather than jeopardize universal service support by immediately eliminating any per-minute charges currently associated with flat costs, the FCC elected to eliminate these non-cost-causative charges over time, gradually increasing the flat-rated PICC to levels necessary to recoup these residual costs. The shift from one type of nondiscriminatory rate structure to another may certainly be accomplished gradually to permit the affected carriers, subscribers and state regulators to adjust to the new pricing system, thus preserving the efficient operation of the interstate telephone network during the interim. Id. at 1135-36. We cannot conclude that this solution is contrary to the 1996 Act. 17 Furthermore, we cannot second-guess the FCC's decision to impose the CCLC and the TIC on originating access minutes. The 1996 Act was intended to encourage competition in the telecommunications market, and the Commission's determination that the above transitional method of accounting for residual costs would increase competition and move costs toward competitive levels is a reasonable one. See Competitive Telecomms., 117 F.3d at 1073-75 (according substantial deference to transitional plan to preserve universal service). It is not the Commission's chore to convince us that what it has done is the best that could be done, but that what it has done is reasonable under difficult circumstances. National Ass'n of Regulatory Util. Comm'rs, 737 F.2d at 1141. 18
19 The BellSouth petitioners next argue that the Commission's decision to exempt purchasers of unbundled network elements (UNEs) from contributing to universal service support through interstate access charges represents an arbitrary and capricious reversal of agency policy and is contrary to § 254's requirement that contributions to universal service support be equitable and nondiscriminatory. 20 After passage of the 1996 Act, the Commission initially determined that purchasers of UNEs would be required to contribute to universal service by paying a portion of access charges, i.e., the entire CCLC and seventy-five percent of the TIC, until the new universal service support mechanism was fully operational. See In re Implementation of the Local Competition Provisions in the Telecommunications Act of 1996; Interconnection between Local Exchange Carriers and Commercial Mobile Radio Service Providers, First Report and Order (CC Docket Nos. 96-98, 95-185), FCC 96-325, 11 FCC Rcd No. 28 15499 p 720 (released August 8, 1996) [hereinafter Local Competition Order ], petition denied in part and order vacated in part, Competitive Telecomms. Ass'n, 117 F.3d at 1068 (addressing only CC Docket No. 96-98). The FCC reasoned that new entrants into the local service market otherwise could avoid contributing to universal service support by serving their local customers solely through the use of unbundled network elements rather than through resale, thereby circumventing imposition of access charges. Id. p 719. The Commission's decision to permit the imposition of some interstate access charges on UNE purchasers, however, was explicitly time-limited and expired on June 30, 1997. See Order p 339. 21 As the BellSouth petitioners acknowledge, the FCC created a general exemption from the assessment of access charges by LECs on purchasers of UNEs, and permitted LECs to assess the CCLC and seventy-five percent of the TIC from such purchasers until June 30, 1997, see 47 C.F.R. § 51.515(a)-(b) (1997). The BellSouth petitioners cannot now complain that passage of the expiration date for this temporary exception and the consequent termination of its application signifies an abrupt change in FCC policy. In fact, the FCC emphasized in the Local Competition Order that it could conceive of no circumstances under which the temporary assessment of access charges on UNE purchasers would be extended beyond June 30, 1997. Local Competition Order p 725. That the FCC has now made good on its promise to exempt purchasers of UNEs from access charges should come as no surprise to the BellSouth petitioners. 22 Nor is the Commission's decision to exempt purchasers of UNEs from access charges that are imposed by incumbent LECs in contravention of § 254's directive to ensure equitable and nondiscriminatory contributions to universal service support. The BellSouth petitioners argue that allowing UNE purchasers access to their networks without the imposition of access charges guarantees discriminatory and inequitable contribution to universal service support by LECs who must continue to contribute, despite their inability to collect a fair contribution from UNE purchasers. As the FCC has explained, however, payment of cost-based rates represents full compensation to the incumbent LEC for use of the network elements that carriers purchase.... Allowing incumbent LECs to recover access charges in addition to the reasonable cost of such facilities would constitute double recovery because the ability to provide access services is already included in the cost of the access facilities themselves. Order p 337. 23 The FCC specifically addresses in the Order the BellSouth petitioners' argument that access charges should be imposed on UNEs because charging only cost-based rates for such elements will not allow the providers to recover universal service support subsidies, which are implicitly built into the access charge regime. The FCC points out that purchasers of UNEs will contribute to universal service pursuant to § 254--they receive no exemption from universal service support obligations by purchasing UNEs. See Order p 338. Furthermore, having observed the market-opening provisions of the 1996 Act in operation for ten months, the FCC has predicted that an extension of the temporary application of interstate access charges to purchasers of UNEs is not necessary to protect the universal service support system from marked losses. According to the FCC, purchasers of UNEs are providing no more than a de minimis share of industry-wide access service[s]. In re Access Charge Reform; Price Cap Performance Review for Local Exchange Carriers; Transport Rate Structure and Pricing; End User Common Line Charges, Order (CC Docket Nos. 96-262, 94-1, 91-213, 95-72), FCC 97-216, 12 FCC Rcd No. 17 10175 p 15 (released June 18, 1997). It is not unreasonable for the FCC to conclude that, given the relatively insignificant headway UNE purchasers have made in the telecommunications market, universal service will not be threatened by the exemption of UNE purchasers from access charges. The Commission also has explained that rate structure modifications adopted in the Order will allow incumbent LECs to recover costs, including those associated with universal service support obligations. See Order p 338. 24 We conclude that the Commission's decision to exempt purchasers of UNEs from interstate access charges is not an arbitrary and capricious departure from statutory standards, nor has the FCC violated its statutory mandate to ensure contributions to universal service that are equitable and nondiscriminatory. Consequently, we will defer to the agency's expertise and leave intact its decision regarding the imposition of interstate access charges on purchasers of UNEs.
25 Finally, the BellSouth petitioners, joined by the Bell Atlantic parties, 7 argue that the Commission's decision to grant information service providers 8 (ISPs) an exemption from interstate access charges creates a new, implicit, and discriminatory subsidy in violation of the 1996 Act; impermissibly forces state regulators to set rates for the recovery of interstate costs; and converts a transitional access charge exemption for ISPs into a permanent one. The FCC denies these assertions and contends that its determination to prohibit the assessment of interstate access charges on ISPs is a reasonable one under the 1996 Act. 26 The BellSouth petitioners initially maintain that the FCC's refusal to extend interstate access charges to ISPs constitutes a new, implicit, and discriminatory subsidy in violation of § 254. They assert that the exemption excuses ISPs from paying the access charges associated with their traffic over the LECs' local networks. Their argument is that the FCC's explanation for this decision--avoiding the disruption of an evolving industry--cannot justify acting in violation of the 1996 Act. The FCC, on the other hand, argues that it did not create a new, implicit, and discriminatory subsidy by declining to extend to ISPs (which never have paid per-minute access rates under the old rules) a rate structure that, as a result of the transition into universal service support funded solely through explicit subsidies, unavoidably includes residual implicit subsidies. See Order p 345. We agree that the FCC's decision to exempt ISPs from interstate access charges while continuing to investigate potential future changes in this area is a reasonable exercise of the agency's discretion under the 1996 Act. 27 Initially we note that the FCC has maintained the same position for the past fourteen years, refusing to permit the assessment of interstate access charges on ISPs. See In re Amendments of Part 69 of the Commission's Rules Relating to the Creation of Access Charge Subelements for Open Network Architecture; Policy and Rules Concerning Rates for Dominant Carriers, Report and Order (CC Docket Nos. 89-79, 87-313), FCC 91-186, 6 FCC Rcd No. 15 4524 p 60 (released July 11, 1991) (noting that access system in which ISPs do not pay interstate per-minute charges is the status quo ). Furthermore, the Commission's actions do not discriminate in favor of ISPs, which do not utilize LEC services and facilities in the same way or for the same purposes as other customers who are assessed per-minute interstate access charges. 9 As this Court noted in Competitive Telecommunications, even where two different sets of carriers seek to use LEC network services and facilities that might be technologically identical, the services and facilities provided by the LEC are distinct if the carriers are making different uses of them. 117 F.3d at 1073. Consequently, different regulatory treatment of LEC services and facilities in such circumstances does not have a discriminatory impact. Id. Here, we agree with the FCC that it is not clear that ISPs use the ... network in a manner analogous to IXCs, Order p 345, and conclude, therefore, that the Commission's refusal to impose access charges on ISPs does not violate § 254's requirement that contributions to universal service be nondiscriminatory. 28 Neither does the Commission's decision to exempt ISPs from interstate access charges violate § 254(e)'s requirement that explicit support mechanisms for universal service be implemented. The Universal Service Order outlines the FCC's plan for eradicating implicit subsidies. Section 254, as we previously have discussed, does not require the immediate elimination of implicit subsidies, only the establishment of a specific timetable to move from implicit to explicit universal service support subsidies. We conclude that the Commission's decision to exempt ISPs from interstate access charges does not constitute the creation of a new, implicit, and discriminatory subsidy in contravention of the 1996 Act. 29 The petitioners also argue that there are uncompensated costs associated with the LECs' service to ISPs. The FCC, however, was not convinced of the alleged shortfalls, and identified sources of revenue that are available to the LECs to cover the interstate costs generated by the ISPs. See Order p 346. The FCC has made a rational choice regarding the treatment of ISPs from a number of alternatives that are each imperfect. When an agency has gone to considerable lengths to amass information, sift through the record for pertinent facts, and reach a temporary conclusion, it has not acted arbitrarily or capriciously. 30 The BellSouth petitioners and the Bell Atlantic parties next allege that the interstate access charge exemption for ISPs impermissibly requires state regulatory commissions to recover interstate costs. They argue that [t]here is no question that ISPs, like IXCs, use the local network to provide interstate services. Bell Atlantic Brief at 12. Moreover, they argue that there is no dispute that the interstate costs imposed on LECs by these services have increased dramatically in recent years as a result of the expansion of traffic on the Internet. The LECs contend that, as a result of this increased traffic, they have been required to spend billions of dollars to enhance network capacity. Id. at 13. While the increased burdens on local networks generate, according to the BellSouth petitioners and Bell Atlantic parties, undeniably interstate costs, they complain that the ISP access charge exemption precludes recovery of the majority of those costs. Id. Instead, ISPs, which are classified as end users, may purchase services from incumbent LECs under the same intrastate tariffs available to end users, without paying equitable rates to compensate LECs for the increased costs associated with the services provided. Order p 342. The petitioners contend that the FCC's suggestion that LECs address their concerns to state regulators, amounts to a dereliction of the Commission's obligation to retain exclusive jurisdiction over interstate communications and forces state regulatory commissions to overstep their authority by recovering interstate costs. Id. p 346 (To the extent that some intrastate rate structures fail to compensate incumbent LECs adequately for providing service to customers with high volumes of incoming calls, incumbent LECs may address their concerns to state regulators.). 31 We disagree with the petitioners' characterization of the manner in which ISPs utilize the local network and thereby generate interstate costs susceptible to FCC regulation. See id. p 343 (noting that FCC tentatively concluded in notice of proposed rulemaking that ISPs should not be subjected to an interstate regulatory system designed for circuit-switched interexchange voice telephony solely because ISPs use incumbent LEC networks to receive calls from their customers.). Contrary to the petitioners' assertions, there is some disagreement as to the manner in which ISPs make use of the local network. As the FCC argues, the services provided by ISPs may involve both an intrastate and an interstate component and it may be impractical if not impossible to separate the two elements. See People of State of California v. FCC, 905 F.2d 1217, 1244 (9th Cir.1990). Consequently, the FCC has determined that the facilities used by ISPs are jurisdictionally mixed, carrying both interstate and intrastate traffic. FCC Brief at 79. Because the FCC cannot reliably separate the two components involved in completing a particular call, or even determine what percentage of overall ISP traffic is interstate or intrastate, see id. (noting that at least some ISP services are purely intrastate and not susceptible to FCC regulation), the Commission has appropriately exercised its discretion to require an ISP to pay intrastate charges for its line and to pay the SLC (which has been increased in the Order to cover a greater proportion of interstate allocated loop costs), but not to pay the per-minute interstate access charge. The states are free to assess intrastate tariffs as they see fit. In these circumstances, we cannot say that the FCC has shirked its responsibility to regulate interstate telecommunications, nor can we conclude that it has directed the States to inflate intrastate tariffs to cover otherwise unrecoverable interstate costs, thereby exceeding its statutory authority. See Iowa Utils. Bd. v. FCC, 120 F.3d 753, 796 (8th Cir.1997) (holding that FCC lacks authority to determine intrastate rates), cert. granted, --- U.S. ----, 118 S.Ct. 879, 139 L.Ed.2d 867 (1998). 32 Moreover, the FCC has not issued its final determination with regard to the treatment of ISPs. As noted in the Order, the Commission has initiated a Notice of Inquiry (NOI) to investigate further what changes, if any, should be made with regard to the regulation of ISPs. See Access Charge Reform; Price Cap Performance Review for Local Exchange Carriers; Transport Rate Structure and Pricing; Usage of the Public Switched Network by Information Service and Internet Access Providers, Proposed Rule (CC Docket Nos. 96-262, 94-1, 91-213, 96-263), FCC 96-488, 62 Fed.Reg. 4670, 4712-13 (1997) (to be codified at 47 C.F.R. pts. 61 and 69). 33 In the NOI, we will address a range of fundamental issues about the Internet and other information services, including ISP usage of the public switched network. The NOI will give us an opportunity to consider the implications of information services more broadly, and to craft proposals for a subsequent NPRM [Notice of Proposed Rulemaking] that are sensitive to the complex economic, technical, and legal questions raised in this area. 34 Order p 348 (footnote omitted). The FCC thus has not foreclosed the possibility that ISPs will be subjected to additional regulation under a scheme yet to be determined. To the extent that the BellSouth petitioners and the Bell Atlantic parties complain about the ISPs' uncompensated burden on their local networks, they, as well as other LECs, are welcome to address their continued concerns to the FCC through the NOI process. 35 Finally, the BellSouth petitioners and the Bell Atlantic parties argue that the FCC has permanently abandoned its stated policy that all those who use the local telephone networks to provide interstate services should bear their fair share of interstate access charges. The petitioners cite Competitive Telecommunications Association v. FCC, 87 F.3d 522 (D.C.Cir.1996) (CompTel ), 10 as support for their position that ISPs should be subject to interstate access charges. In the 1983 Access Charge Order at issue in CompTel, the FCC had instituted transitional rules favoring smaller long-distance carriers in an effort to promote competition in the long-distance market. These transitional rules were extended by the Commission for thirteen years under the justification that sufficient cost information necessary to determine appropriate rates was not yet developed. The D.C. Circuit struck down the rules acknowledging that, while the FCC is not required to impose purely cost-based rates for all services, it must specially justify any rate differential that does not reflect cost. Id. 36 The facts in CompTel are distinguishable from the facts with which we are faced here. In CompTel, the FCC was imposing inconsistent, allegedly transitional rates on entities--incumbent long-distance carriers and smaller long-distance carriers--that essentially provided identical services. Here, the FCC is exempting from interstate access charges ISPs that, according to the FCC, utilize the local networks differently than do IXCs. The FCC has justified its decision to exempt ISPs from access charges paid by IXCs by noting the distinction between the manner in which these separate entities utilize the local networks. See, e.g., Order pp 343, 345. 37 The FCC explained in the Order that [m]aintaining the existing pricing structure for [ISP] services avoids disrupting the still-evolving information services industry and advances the goals of the 1996 Act to 'preserve the vibrant and competitive free market that presently exists for the Internet and other interactive computer services, unfettered by Federal or State regulation.'  Order p 344 (footnote omitted) (quoting 47 U.S.C.A. § 230(b)(2)). The Commission reasonably has exercised its discretion in evaluating the relevant data and in concluding that, at least for the present, ISPs should be excluded from the imposition of interstate access charges. We will overturn an agency rule as arbitrary and capricious only if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise. Motor Vehicle Mfrs. Ass'n of the United States v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983). We find no such fault with the Commission's decision and we decline to interfere with the FCC's determination to grant ISPs an exemption from interstate access charges.