Federal Communications Commission   DA 07-709
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
Time Warner Cable Request for Declaratory 
Ruling that Competitive Local Exchange Carriers 
May Obtain Interconnection Under Section 251 of 
the Communications Act of 1934, as Amended, to 
Provide Wholesale Telecommunications Services 
to VoIP Providers
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WC Docket No. 06-55
MEMORANDUM OPINION AND ORDER
Adopted:  March 1, 2007   Released: March 1, 2007
By the Chief, Wireline Competition Bureau:  
I. INTRODUCTION
1. In this Order, the Wireline Competition Bureau (Bureau) grants a petition for declaratory 
ruling filed by Time Warner Cable (TWC) asking the Commission to declare that wholesale 
telecommunications carriers are entitled to interconnect and exchange traffic with incumbent local exchange 
carriers (LECs) when providing services to other service providers, including voice over Internet Protocol 
(VoIP) service providers pursuant to sections 251(a) and (b) of the Communications Act of 1934, as 
amended (the Act).1  As explained below, we reaffirm that wholesale providers of telecommunications 
services are telecommunications carriers for the purposes of sections 251(a) and (b) of the Act, and are 
entitled to the rights of telecommunications carriers under that provision. We conclude that state 
commission decisions denying wholesale telecommunications service providers the right to interconnect 
with incumbent LECs pursuant to sections 251(a) and (b) of the Act are inconsistent with the Act and 
Commission precedent and would frustrate the development of competition and broadband deployment.  
II. BACKGROUND
A. TWC’s Petition
2. On March 1, 2006, TWC filed a petition for declaratory ruling requesting that the Commission 
affirm that “requesting wholesale telecommunications carriers are entitled to obtain interconnection with
incumbent LECs to provide wholesale telecommunications services to other service providers” (including 
  
1 Petition of Time Warner Cable for Declaratory Ruling that Competitive Local Exchange Carriers May Obtain 
Interconnection under Section 251 of the Communications Act of 1934, as Amended, to Provide Wholesale 
Telecommunications Services to VoIP Providers, WC Docket No. 06-55 (filed Mar. 1, 2006) (Petition); 47 U.S.C.  
§ 251; Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996) (1996 Act or the Act). 
Federal Communications Commission  DA 07-709
2
VoIP-based providers).2  In its Petition, TWC states that in 2003 it began to deploy a facilities-based 
competitive telephone service using VoIP technology, which enables it to offer a combined package of 
video, high-speed data, and voice services.3 TWC purchases wholesale telecommunications services from 
certain telecommunications carriers, including MCI WorldCom Network Services Inc. (MCI)4 and Sprint 
Communications Company, L.P. (Sprint), to connect TWC’s VoIP service customers with the public 
switched telephone network (PSTN).5 MCI and Sprint provide transport for the origination and 
termination on the PSTN through their interconnection agreements with incumbent LECs.  In addition, 
MCI and Sprint provide TWC with connectivity to the incumbent’s E911 network and other necessary 
components as a wholesale service.6  
3. TWC claims that MCI has been unable to provide wholesale telecommunications services to 
TWC in certain areas in South Carolina and that Sprint has been unable to provide wholesale 
telecommunications services to TWC in certain areas in Nebraska because, unlike certain other state 
commissions, the South Carolina Public Service Commission (South Carolina Commission) and the 
Nebraska Public Service Commission (Nebraska Commission) have determined that rural incumbent LECs 
are not obligated to enter into interconnection agreements with competitive service providers (like MCI and 
Sprint) to the extent that such competitors operate as wholesale service providers.7  TWC argues that the 
  
2 Petition at 11.  The Petition was placed on public notice on March 6, 2006 with comments due by March 27, 
2006, and reply comments due by April 11, 2006.  Pleading Cycle Established for Comments on Time Warner 
Cable’s Petition for Declaratory Ruling that Competitive Local Exchange Carriers May Obtain Interconnection to 
Provide Wholesale Telecommunications Services to VoIP Providers, WC Docket No. 06-55, Public Notice, 21 FCC 
Rcd 2276 (Wireline Comp. Bur. 2006).  Upon Motions for Extension, the comment cycle was extended by two 
weeks, to April 10, 2006 for comments and April 25, 2006 for reply comments.  Wireline Competition Bureau 
Grants Request for Extension of Time to File Comments on Time Warner Cable’s Petition for Declaratory Ruling 
That Competitive Local Exchange Carriers May Obtain Interconnection to Provide Wholesale 
Telecommunications Service to VoIP Providers, WC Docket 06-55, Public Notice, 21 FCC Rcd 2978 (Wireline 
Comp. Bur. 2006).  Contemporaneously with its filing of the Petition, TWC filed a Petition for Preemption 
requesting that the Commission preempt the South Carolina Commission’s denial of TWC’s application for a 
Certification of Public Convenience and Necessity in areas where rural LECs provide service.  That preemption 
petition remains pending, and we do not address it here.  Petition of Time Warner Cable for Preemption Pursuant 
to Section 253 of the Communications Act of 1934, as Amended, WC Docket No. 06-54 (filed Mar. 1, 2006).  
3 Petition at 2-3. 
4 As a result of the merger between MCI and Verizon, TWC’s contractual arrangements with MCI have been 
assigned to Verizon Business.  Id. at 4 n.5
5 Id. at 4.  
6 Id.  
7 See Petition of MCImetro Access Transmission Services LLC for Arbitration of Certain Terms and Conditions of 
Proposed Agreement with Farmers Telephone Cooperative, Inc., Home Telephone Co., Inc., PBT Telecom, Inc., 
and Hargray Telephone Company, Concerning Interconnection and Resale under the Telecommunications Act of 
1996, Docket No. 2005-67-C, Order Ruling on Arbitration, Order No. 2005-544 (Oct. 7, 2005) (South Carolina 
Commission RLEC Arbitration Order); Sprint Communications Company L.P., Overland Park, Kansas, Petition 
for arbitration under the Telecommunications Act, of certain issues associated issues with the proposed 
interconnection agreement between Sprint and Southeast Nebraska Telephone Company, Falls City, Application 
No. C-3429, Findings and Conclusions (Sept. 13, 2005) (Nebraska Commission Arbitration Order) appeal filed, 
Sprint Communications Company L.P. v. Nebraska Public Service Commission, No. 4:05CV3260 (D. Neb. Oct. 
(continued….)
Federal Communications Commission  DA 07-709
3
South Carolina and Nebraska Commissions misinterpreted the statute when they decided, among other 
things, that competitive LECs providing wholesale telecommunications services to other service providers, 
in this case VoIP-based providers, are not “telecommunications carriers” for the purposes of section 251 of 
the Act, and, therefore, are not entitled to interconnect with incumbent LECs.
4. TWC asks the Commission to grant a declaratory ruling reaffirming that telecommunications 
carriers are entitled to obtain interconnection with incumbent LECs to provide wholesale 
telecommunications services to other service providers.  The Petition also requests that the Commission 
clarify that interconnection rights under section 251 of the Act are not based on the identity of the 
wholesale carrier’s customer.  
B. State Commission Decisions
5. South Carolina.  On October 8, 2004, MCI initiated interconnection negotiations pursuant to 
section 252(a) of the Act with four rural incumbent LECs operating in South Carolina.  These rural 
incumbent LECs claimed that they were not required to accept traffic from a third-party provider that 
purchases wholesale telecommunications services from MCI.8  On March 17, 2005, MCI filed a petition 
with the South Carolina Commission seeking arbitration of the unresolved issues between MCI and the 
rural incumbent LECs.9  In arbitrating this dispute, the South Carolina Commission agreed with the rural 
incumbent LECs that the arbitrated interconnection agreement should be limited to the traffic generated by 
the rural incumbent LECs’ customers and MCI’s direct end-user customers on their respective networks.10  
The South Carolina Commission determined that MCI is not entitled to seek interconnection with the rural 
incumbent LECs with respect to the wholesale services MCI proposed to provide to TWC because such
wholesale service does not meet the definition of “telecommunications service” under the Act and, 
therefore, MCI is not a “telecommunications carrier” with respect to those services.11 The South Carolina 
Commission also found that section 251(b) obligations “relate to parallel obligations between two 
competing telecommunications carriers” and that MCI’s intent to act as an “intermediary for a facilities-
(Continued from previous page)    
11, 2005). As explained below, this aspect of the state decisions regarding wholesale services is not specific to 
wholesale carriers that serve VoIP service providers.
8 Petition at 4-5.  See also South Carolina Commission RLEC Arbitration Order.  The four rural incumbent LECs 
with which MCI sought interconnection agreements were Farmers Telephone Cooperative, Inc., Home Telephone 
Co., Inc., PBT Telecom, Inc., and Hargray Telephone Company.  The South Carolina Commission referred to the 
four rural LECs collectively as “the RLECs” throughout its order.  The South Carolina Commission addressed 
similar issues and made similar findings in the South Carolina Commission Horry Arbitration Order.  Petition of 
MCImetro Access Transmission Services, LLC for Arbitration of Certain Terms and Conditions of Proposed 
Agreement with Horry Telephone Cooperative, Inc. Concerning Interconnection and Resale under the 
Telecommunications Act of 1996, Order Ruling on Arbitration, Docket No. 2005-188-C (South Carolina PSC Jan. 
11, 2006) (South Carolina Horry Arbitration Order).
9 South Carolina Commission RLEC Arbitration Order at 2. 
10  South Carolina Commission RLEC Arbitration Order at 7.  See also South Carolina Commission Horry 
Arbitration Order at 6.  In addition, the South Carolina Commission denied TWC’s request to intervene in the 
arbitration.     
11 See South Carolina Commission RLEC Arbitration Order at 11.
Federal Communications Commission  DA 07-709
4
based VoIP service provider” is a type of non-parallel relationship not contemplated or provided for under 
the Act.12
6. Nebraska.  On December 16, 2004, Sprint commenced interconnection negotiations with 
Southeast Nebraska Telephone Company (SENTCO), a rural incumbent LEC, pursuant to section 252(a) 
of the Act.13 In its September 13, 2005 arbitration decision, the Nebraska Commission determined that 
Sprint is not a “telecommunications carrier” under the NARUC I and Virgin Islands test for common 
carriage because the relationship between Sprint and TWC is an “individually negotiated and tailored, 
private business arrangement” that is an untariffed offering to a sole user of this service,14 and, therefore, 
Sprint cannot assert any rights under sections 251 and 252 of the Act.  In addition, the Nebraska 
Commission held that because TWC operates the switch that “directly serves the called party,” Sprint was 
not entitled to exercise rights under section 251(b).15  
7. Other State Proceedings.  TWC asserts that, in contrast to the South Carolina and Nebraska 
decisions, public utility commissions in Illinois, Iowa, New York and Ohio have recognized that wholesale 
service providers, such as Sprint and MCI, are telecommunications carriers with rights under section 251 
of the Act.16 In addition, TWC and other commenters point to other state commissions that have before 
them pending proceedings on this same issue.17
  
12 Id. at 9.  
13 See Nebraska Commission Arbitration Order.  
14 Id. at 7-9 (citing National Ass’n of Regulatory Util. Comm’rs v. FCC, 525 F.2d 630 (D.C. Cir. 1976) (NARUC 
I), cert. denied, 425 U.S. 992 (1976); Virgin Islands Tel. Co. v. FCC, 198 F.3d 921 (D.C. Cir. 1999)).
15 Id. at 7-8.
16 Petition at 8-9 (citing Cambridge Telephone Company, et al. Petitions for Declaratory Relief and/or 
Suspensions for Modification Relating to Certain Duties under §§ 251(b) and (c) of the Federal 
Telecommunications Act, Case Nos. 050259, et al., Order (Illinois Commerce Commission Aug. 23, 2005), appeal 
pending Harrisonville Telephone Company, et al. v. Illinois Commerce Commission, et al., Case No. 3:06-CV-
00073, GPMDGW, Complaint for Declaratory and Other Relief (S.D. Ill. filed Aug. 16, 2006); Arbitration of 
Sprint Communications Co. v. Ace Communications Group, et al., Docket No. ARB-05-02, Order on Rehearing 
(Iowa Utilities Board Nov. 28, 2005); Petition of Sprint Communications Company L.P., Pursuant to Section 
252(b) of the Telecommunications Act of 1996 for Arbitration to Establish an Intercarrier Agreement with 
Independent Companies, Case 05-C-0170, Order Resolving Arbitration Issues (New York Public Service 
Commission May 24, 2005), on appeal Berkshire Telephone Corp. v. Sprint Communications Co. L.P., Civ. 
Action No. 05-CV-6502 (CJS)(MWP)(W.D.N.Y. filed Sept. 26, 2005); Application and Petition in Accordance 
with Section II.A.2.B of the Local Service Guidelines Filed by: The Champaign Telephone Co., Telephone Services 
Co., the Germantown Independent Telephone Co., and Doylestown Telephone Co., Case Nos. 04-1494-TP-UNC, et 
al., Finding and Order (Public Utility Commission of Ohio Jan. 26, 2005), reh’g denied in pertinent part, Order on 
Rehearing (Public Utilities Commission of Ohio Apr. 13, 2005)).  
17 See Petition at 9.  See, e.g., Letter from Cherie R. Kiser, Counsel for IDT Telecom, Inc., to Marlene H. Dortch, 
Secretary, FCC, WC Docket No. 06-55, Appendix (filed Sept. 25, 2006) (providing an updated overview of 
pending state and court proceedings in Illinois, Iowa, New York, North Carolina and Texas).  
Federal Communications Commission  DA 07-709
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III. DISCUSSION
8. The Bureau grants TWC’s request to the extent described below.  Because the Act does not 
differentiate between retail and wholesale services when defining “telecommunications carrier” or 
“telecommunications service,” we clarify that telecommunications carriers are entitled to interconnect and 
exchange traffic with incumbent LECs pursuant to section 251(a) and (b) of the Act for the purpose of 
providing wholesale telecommunications services.18  The Bureau finds that a contrary decision would 
impede the important development of wholesale telecommunications and facilities-based VoIP competition, 
as well as broadband deployment policies developed and implemented by the Commission over the last 
decade, by limiting the ability of wholesale carriers to offer service.   
A. “Telecommunications Service” Can Be Either a Wholesale or Retail Service
9. Consistent with Commission precedent, we find that the Act does not differentiate between the 
provision of telecommunications services on a wholesale or retail basis for the purposes of sections 251(a) 
and (b), and we confirm that providers of wholesale telecommunications services enjoy the same rights as 
any “telecommunications carrier” under those provisions of the Act.19  We further conclude that the 
statutory classification of the end-user service, and the classification of VoIP specifically, is not dispositive 
of the wholesale carrier’s rights under section 251.
10. The Act defines “telecommunications” to mean “the transmission, between or among points 
specified by the user, of information of the user’s choosing, without change in the form or content of the 
information as sent and received.”20 The Act defines “telecommunications service” to mean “the offering of 
telecommunications for a fee directly to the public, or to such classes of users as to be effectively available 
directly to the public, regardless of the facilities used.”21 Finally, any provider of telecommunications 
services is a “telecommunications carrier” by definition under the Act.22  
11. It is clear under the Commission’s precedent that the definition of “telecommunications 
services” is not limited to retail services, but also includes wholesale services when offered on a common 
carrier basis.  The South Carolina Commission’s contrary interpretation – that services provided on a 
  
18 Because neither of the primary state commission proceedings underlying the Petition relied on or even 
interpreted section 251(c) of the Act, we do not read the Petition to seek clarification on the ability to interconnect 
pursuant to that provision.  As such, we only address the issues raised in the Petition as they apply to sections 
251(a) and (b) of the Act.  
19 To resolve the confusion over the meaning of “wholesale,” we affirm the longstanding Commission usage of a
wholesale transaction of a service or product as an input to a further sale to an end user, in contrast to a retail 
transaction for the customer’s own personal use or consumption.  Deployment of Wireline Services Offering 
Advanced Telecommunications Capability, CC Docket No. 98-147, Second Report and Order, 14 FCC Rcd 19237, 
19423, para. 13 (1999) (“Black’s Law Dictionary defines retail as ‘[a] sale for final consumption in contrast to a 
sale for further sale or processing (i.e., wholesale) . . . to the ultimate consumer.’”) (quoting Black’s Law 
Dictionary 1315 (6th ed. 1990)).
20 47 U.S.C. § 153(43).  
21 47 U.S.C. § 153(46).
22 47 U.S.C. § 153(44).
Federal Communications Commission  DA 07-709
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wholesale basis to carriers or other providers are not telecommunications services because they are not 
offered “directly to the public”23 has been expressly rejected by the Commission in the past, as we explain 
below.24  
12. The definition of “telecommunications services” in the Act does not specify whether those 
services are “retail” or “wholesale,” but merely specifies that “telecommunications” be offered for a fee 
“directly to the public, or to such classes of users as to be effectively available directly to the public.”25  In 
NARUC II, the D.C. Circuit stated that “[t]his does not mean that the particular services offered must 
practically be available to the entire public; a specialized carrier whose service is of possible use to only a 
fraction of the population may nonetheless be a common carrier if he holds himself out to serve 
indifferently all potential users.”26  Thus, the question at issue in this proceeding is whether the relevant 
wholesale telecommunications “services” are offered “directly to the public, or to such classes of users as 
to be effectively available directly to the public.”  Indeed, the definition of “telecommunications services” 
long has been held to include both retail and wholesale services under Commission precedent.  In the Non-
Accounting Safeguards Order, the Commission concluded that wholesale services are included in the 
definition of “telecommunications service.”27 To reach this result, the Commission determined that the term 
“wholesale” in section 251(c)(4) “implicitly recognizes that some telecommunications services are 
wholesale services.”28 The Non-Accounting Safeguards Order went on to find that the legislative history 
of the Act also supports this determination, as it “indicates that the definition of telecommunications 
services is intended to clarify that telecommunications services are common carrier services, which include 
wholesale services to other carriers” and that “the term ‘telecommunications service’ was not intended to 
create a retail/wholesale distinction.”29  The Commission affirmed these conclusions in the Non-Accounting 
Safeguards Reconsideration Order where it found “no basis in the statute, legislative history, or FCC 
precedent for finding the reference to ‘the public’ in the statutory definition to be intended to exclude 
  
23 South Carolina Commission Arbitration Order at 7 (stating that “[t]he carrier directly serving the end user 
customer is the only carrier entitled to request interconnection for the exchange of traffic under Section 251(b) of 
the Act.”), 11 (concluding that “MCI is not entitled to seek interconnection with the RLECs with respect to the 
service MCI proposed to provide indirectly to TWCIS’ end user customers.”).  
24 Implementation of the Non-Accounting Safeguards of Sections 271 and 272 of the Communications Act of 1934, 
as Amended, CC Docket No. 96-149, First Report and Order and Further Notice of Proposed Rulemaking, 11 FCC 
Rcd 21905, 22033, para. 264 (1996) (subsequent history omitted) (Non-Accounting Safeguards Order); see also
Implementation of the Non-Accounting Safeguards of Sections 271 and 272 of the Communications Act of 1934, as 
Amended, CC Docket No. 96-149, Second Order on Reconsideration, 12 FCC Rcd 8653, 8670-71, para. 33 (1997) 
(Non-Accounting Safeguards Reconsideration Order);  Federal-State Joint Board on Universal Service, CC 
Docket No. 96-45, Report and Order, 12 FCC Rcd 8776, 9177-8, para. 785 (1997) (Universal Service Order) 
(subsequent history omitted).  
25 47 U.S.C. § 153(46).  
26 National Ass’n of Regulatory Utility Com’rs v. FCC, 533 F.2d 601, 608 (C.A.D.C. 1976) (NARUC II).  
27 Non-Accounting Safeguards Order, 11 FCC Rcd at 22033, para. 264.  
28 Id.  See also 47 U.S.C. § 251(c)(4) (requiring incumbent LECs “to offer for resale at wholesale rates any 
telecommunications service that the carrier provides at retail to subscribers who are not telecommunications 
carriers”) (emphasis added).  
29 Id. at 22032-33, 22033-34, paras. 263, 265.  
Federal Communications Commission  DA 07-709
7
wholesale telecommunications services.”30  Further, in the Universal Service Order, the Commission 
determined that, while “telecommunications services” are intended to encompass only telecommunications 
provided on a common carrier basis, “common carrier services include services offered to other carriers, 
such as exchange access service, which is offered on a common carrier basis, but is offered primarily to 
other carriers.”31 In Virgin Islands, the D.C. Circuit stressed that the Commission did not rely on a 
wholesale-retail distinction, stating that “the focus of its analysis is on whether AT&T-SSI offered its 
services indiscriminately in a way that made it a common carrier . . . and the fact that AT&T-SSI could be 
characterized as a wholesaler was never dispositive.”32  
13. We further find that our decision today is consistent with and will advance the Commission’s 
goals in promoting facilities-based competition as well as broadband deployment.  Apart from encouraging 
competition for wholesale services in their own right,33 ensuring the protections of section 251 
interconnection is a critical component for the growth of facilities-based local competition.34 Moreover, as 
the Commission has recognized most recently in the VoIP 911 Order, VoIP is often accessed over 
broadband facilities, and there is a nexus between the availability of VoIP services and the goals of section 
706 of the Act.35  Furthermore, as the Petition and some commenters note, in that order the Commission
expressly contemplated that VoIP providers would obtain access to and interconnection with the PSTN 
through competitive carriers.36  Therefore, we also rely on section 706 as a basis for our determination 
today that affirming the rights of wholesale carriers to interconnect for the purpose of exchanging traffic 
with VoIP providers will spur the development of broadband infrastructure.37 We further conclude that 
such wholesale competition and its facilitation of the introduction of new technology holds particular 
  
30 Non-Accounting Safeguards Reconsideration, 12 FCC Rcd at 8670-71, para. 33.  
31 Universal Service Order, 12 FCC Rcd  at 9177-8, para. 785.  
32 Virgin Islands Tel. Co. v. FCC, 198 F.3d 921, 930 (D.C. Cir. 1999) (Virgin Islands).  
33 As explained above, see supra para. 1, we affirm today the rights of all wholesale carriers to interconnect when 
providing service to other providers, and therefore we reject the notion that we must dismiss the Petition in part 
with respect to the Nebraska Commission’s decision because the Nebraska Commission Arbitration Order did not 
discuss Sprint’s provision of service to VoIP providers.  See Letter from Thomas J. Moorman and Paul M. Schudel, 
Counsel to SENTCO, to Marlene H. Dortch, Secretary, FCC, WC Docket No. 06-55 (filed Feb. 12, 2007).  
34 E.g., Advance-Newhouse Comments at 3 (facilities-based residential competition); Verizon Comments at 3 
(wholesale service and local competition).
35 IP-Enabled Services, WC Docket No. 04-36; E911 Requirements for IP-Enabled Service Providers, WC Docket 
No. 05-196, First Report and Order and Notice of Proposed Rulemaking, 20 FCC Rcd 10245, 10264, para. 31 
(2005) (VoIP 911 Order) (citing 47 U.S.C. §157 nt.).  Section 706 directs the Commission (and state commissions 
with jurisdiction over telecommunications services) to encourage the deployment of advanced telecommunications 
capability to all Americans by using measures that “promote competition in the local telecommunications market” 
and removing “barriers to infrastructure investment.”  Id.
36 See Petition at 21 (citing VoIP 911 Order, 20 FCC Rcd at 10267, para.38); see also, e.g., VON Coalition 
Comments at 3.  
37 Verizon Comments at 6 (“Simply put, just as the availability of VoIP drives both providers to deploy and end-
user customers to purchase broadband services, state commission decisions that effectively prevent consumers from 
using their broadband connection for VoIP telephony discourage the deployment and use of broadband.”).
Federal Communications Commission  DA 07-709
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promise for consumers in rural areas.38  
14. In making this clarification, we emphasize that the rights of telecommunications carriers to 
section 251 interconnection are limited to those carriers that, at a minimum, do in fact provide 
telecommunications services to their customers, either on a wholesale or retail basis.39 We do not address 
or express any opinion on any state commission’s evidentiary assessment of the facts before it in an 
arbitration or other proceeding regarding whether a carrier offers a telecommunications service. However, 
we make clear that the rights of telecommunications carriers under sections 251 (a) and (b) apply 
regardless of whether the telecommunications services are wholesale or retail, and a state decision to the 
contrary is inconsistent with the Act and Commission precedent.40  
B. The Section 251 (a) and (b) Rights of a Wholesale Telecommunications Carrier Do 
Not Depend on the Regulatory Classification of the Retail Service Offered to the End 
User
15. As explained above, a provider of wholesale telecommunications service is a 
telecommunications carrier and is entitled to interconnection under section 251 of the Act.  The regulatory 
classification of the service provided to the ultimate end user has no bearing on the wholesale provider’s 
rights as a telecommunications carrier to interconnect under section 251.  As such, we clarify that the
statutory classification of a third-party provider’s VoIP service as an information service or a 
telecommunications service is irrelevant to the issue of whether a wholesale provider of telecommunications 
may seek interconnection under section 251(a) and (b).  Thus, we need not, and do not, reach here the 
  
38 E.g., GCI Reply Comments at 4 (“offerings like those of TWC are especially valuable to rural consumers”); 
Sprint Nextel Comments at 4 n.6 (“Wholesale carrier services are particularly important to smaller cable operators, 
which often serve low density areas and lack the resources, scale or desire to enter the telephony market alone.”); 
VON Coalition Comments at 3.  See also, Letter from Vonya B. McCann, Vice President – Government Affairs, 
Sprint Nextel, to Marlene H. Dortch, FCC, WC Docket No. 06-55 at 2 (filed Jan. 30, 2007) (“These services enable 
even small cable providers to expand their service offerings -- faster and at lower cost -- and thus promote 
investment in areas previously under-served and lacking choices for consumers.”).
39 For example, under the Commission’s existing rules, “[a] telecommunications carrier that has interconnected or 
gained access under section[ ] 251(a) . . . of the Act, may offer information services through the same arrangement, 
so long as it is offering telecommunications services through the same arrangement as well.”  47 C.F.R. § 
51.100(b) (emphasis added).  Thus, the fact that a telecommunications carrier is also providing a non-
telecommunications service is not dispositive of its rights.  
40 See South Carolina Commission RLEC Arbitration Order at 14 (limiting the definition of end user to subscriber 
of telephone exchange service); Nebraska Commission Arbitration Order at 9, paras. 25-26 (reasoning that the 
exclusion of exchange access in the Commission’s reciprocal compensation rules indicates that TWC’s offering of 
exchange access is not offered to the general public).  Although the Nebraska Commission’s order expressly raised 
the issue of Sprint’s entitlement to reciprocal compensation pursuant to section 251(b)(5), commenters contend 
that the Nebraska Commission’s decision properly is interpreted to affect section 251(a) and (b) rights more 
broadly.  See AT&T Comments at 1-2.  We do not address commenters’ requests for classification of other specific 
service offerings or traffic arrangements.  See, e.g., Neutral Tandem Comments (seeking a declaration of section 
251 rights to provide tandem switching and transit services).   
Federal Communications Commission  DA 07-709
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issues raised in the IP-Enabled Services docket, including the statutory classification of VoIP services.41  
We thus reject the arguments that the regulatory status of VoIP is the underlying issue in this matter or that 
Commission action on this Petition will prejudge issues raised in the IP-Enabled Services docket. 42  We 
also make clear that we do not address any entitlement of a retail service provider to serve end users 
through such a wholesale arrangement, nor, contrary to the views of some commenters, do we read the 
Petition to seek such rights.43 Rather, in issuing this decision, we reiterate that we only find that a carrier is 
entitled to interconnect with another carrier pursuant to sections 251(a) and (b) in order to provide 
wholesale telecommunications service.  
16. Finally, we emphasize that our ruling today is limited to telecommunications carriers that 
provide wholesale telecommunications service and that seek interconnection in their own right for the 
purpose of transmitting traffic to or from another service provider.  To address concerns by commenters 
  
41 In the IP-Enabled Services NPRM, the Commission sought comment on whether VoIP should be classified as a 
telecommunications service or an information service.  See IP-Enabled Services NPRM, WC Docket No. 04-36, 
Notice of Proposed Rulemaking, 19 FCC Rcd 4863 (2004) (IP-Enabled Services NPRM).  
42 HTC/PBT Comments at 3 (referring to the ongoing IP-Enabled Services proceeding, “[t]his Commission should 
not fall prey to pressure from parties to issue piecemeal orders.”); ITTA et al. Comments at 8 (“[t]he Commission 
should accordingly declare either that TWC is a telecommunications carrier itself, or is subject to the same 
intercarrier compensation, universal service and other requirements imposed on similarly situated carriers”); JSI 
Comments at 7 (“While the treatment of interconnected VoIP service providers remains unclear, Time Warner 
seeks to have the Commission make declarations that would greatly favor VoIP service providers by granting them 
certain rights without attendant obligations.”); Pennsylvania Commission Comments at 5 (suggesting that the 
Commission “consider resolving complex policy matters in more generic proceeding such at the IP-Enabled 
Services and Intercarrier Compensation rulemakings, as opposed to limited decisions in case-specific pleadings”); 
Qwest Comments; NTCA Reply Comments at 4-5; SDTA Comments at 4; TCA Comments at 5-7; WTA 
Comments at 3.  See also, Letter from Joshua Seidemann, Independent Telephone and Telecommunications 
Alliance, to Marlene H. Dortch, Secretary, FCC, WC Docket No. 06-55, Attach at 6 (filed Dec. 14, 2006) (ITTA 
Ex Parte); Letter from Keith Oliver, Vice President -- Finance, Home Telephone Company, on behalf of South 
Carolina Telephone Coalition, to Marlene H. Dortch, Secretary, FCC, WC Docket No. 06-55, Attach. at 8 (filed 
Jan. 30, 2007) (SCTC Ex Parte).
43 See, e.g., JSI Comments at 12 (“Time Warner is seeking to claim specific rights without accepting attendant 
obligations.”); ITTA Comments at 12 (“In other words, entities that seek the benefits of carrier-type 
interconnection, including for example, the right to obtain numbering resources and number portability, should be 
subject to the same obligations as the traditional carriers with whom they compete.”); Western Alliance at 3, 6 
(“TWC is not entitled to any CLEC rights under Section 251 and 252 as long as it elects to reject its former CLEC 
status and characterize itself instead as a non-regulated information service provider.”).  Furthermore, and contrary 
to the position put forth in the South Carolina Commission Arbitration Order and the assertions of some 
commenters, we do not read the Act or have any policy reason to impose a requirement that telecommunications 
carriers seeking to interconnect must have obligations or business models parallel to those of the party receiving 
the interconnection request.  See South Carolina Commission Arbitration Order at 9 (stating that “obligations 
imposed by Section 251(b) . . . relate to parallel obligations between two competing telecommunications carriers”); 
SCTC Comments at 8 (arguing that “the obligations imposed by Section 251(b) . . . relate to parallel obligations 
between two competing telecommunications carriers within a common local calling area.”).  See also Letter from 
Gerard J. Duffy, Counsel for Western Telecommunications Alliance, to Marlene H. Dortch, Secretary, FCC, WC 
Docket No. 06-55 at 6 (filed Feb. 6, 2007) (stating that the “Sprint-Time Warner Model Unfairly Tilts Competitive 
Playing Field” and that Time Warner is not subject to the Title II and consumer protection standards of incumbent 
LECS) .
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about which parties are eligible to assert these rights,44 we make clear that the scope of our declaratory 
ruling is limited to wholesale carriers that are acting as telecommunications carrier for purposes of their 
interconnection request.  In affirming the rights of wholesale carriers, we also make clear that today’s 
decision in no way diminishes the ongoing obligations of these wholesalers as telecommunications carriers, 
including compliance with any technical requirements imposed by this Commission or a state commission.45
In addition, we agree that it is most consistent with Commission policy that where a LEC wins back a 
customer from a VoIP provider, the number should be ported to the LEC that wins the customer at the 
customer’s request,46 and therefore we make such a requirement an explicit condition to the section 251 
rights provided herein.47  Other concerns about porting will be addressed in the IP-Enabled Services
proceeding.48  
C. Other Issues Raised by Commenters 
17. Certain commenters ask us to reach other issues, including the application of section 
251(b)(5)49 and the classification of VoIP services.50  We do not find it appropriate or necessary here to 
resolve the complex issues surrounding the interpretation of Title II more generally or the subsections of 
section 251 more specifically that the Commission is currently addressing elsewhere on more 
  
44 See, e.g., JSI Comments at 4 (“MCI’s role as an intermediary is to be largely hands-off and remote.”); SCTC 
Comments at 11-14 (asserting that “MCI merely proposed to act as an intermediary – a ‘connection’ – between two 
facilities-based carriers – the RLEC and Time Warner,” and that “Time Warner is seeking . . . to make an ‘end 
run’ around the important federal state proceedings and powers”); Western Alliance at 3 (“What TWC is asking 
herein is for MCI and Sprint to be authorized to use the Section 252 procedures and to negotiate Section 251(b) 
and/or Section 252(c) interconnection agreements in TWC’s behalf . . . .”).  Although the Petition does refer in 
passing to MCI and Sprint acting “on behalf of” TWC, the focus of the Petition and even the underlying state 
commission decisions concern the rights of those carriers as wholesale telecommunications service providers, and 
we therefore do not reach the question of the rights of an agent of a VoIP service provider.  See Petition at 12, 23; 
South Dakota Comments at 6.  See also, Black’s Law Dictionary (8th ed. 2004) (defining agent as “[o]ne 
authorized to act for or in place of another” or “representative”). 
45 See, e.g., SCTC Ex Parte, Attach. at 9 (asserting that each wholesale provider should be “technically responsible 
for the traffic it delivers to an ILEC.”).    
46 See, e.g., id., Attach. at 10 (seeking protection for “consumers that want to port numbers away from 3rd party 
service providers who do not have these porting responsibilities.”); JSI Comments at 12-14 (“Time Warner is 
seeking to create a one-way approach to porting and the Commission should reject the Petition.”).  Because our 
number portability rules apply to all local exchange carriers, customers effectively are able to port numbers to VoIP 
providers today by virtue of their relationship with a wholesale local exchange carrier.  47 C.F.R. § 52.23.  
47 We note that Verizon already makes such a commitment under its agreements with Time Warner Cable.  See
Verizon Reply Comments at 11-12.
48 See IP-Enabled Services NPRM, 19 FCC Rcd at 4911-12, para. 73.
49 See, e.g., Neutral Tandem Comments at 1, 5, 7 (seeking Commission protection against incumbent LEC and 
state restrictions on resale and tandem competition, and for the establishment of the right of third-party providers 
to be defined as “users” under interconnection agreements).
50 See, e.g., Qwest Comments at 6 (“The Nebraska position is obviously dependent on how the Commission 
ultimately classifies VoIP service.”).
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comprehensive records.51 For example, the question concerning the proper statutory classification of VoIP 
remains pending in the IP-Enabled Services docket.52  Moreover, in this declaratory ruling proceeding we 
do not find it appropriate to revisit any state commission’s evidentiary assessment of whether an entity 
demonstrated that it held itself out to the public sufficiently to be deemed a common carrier under well-
established case law. In the particular wholesale/retail provider relationship described by Time Warner in 
the instant petition, the wholesale telecommunications carriers have assumed responsibility for 
compensating the incumbent LEC for the termination of traffic under a section 251 arrangement between 
those two parties.  We make such an arrangement an explicit condition to the section 251 rights provided 
herein.53 We do not, however, prejudge the Commission’s determination of what compensation is 
appropriate, or any other issues pending in the Intercarrier Compensation docket.
D. Procedural Issues
18. Jurisdiction.  We reject SENTCO’s contention that the Commission lacks jurisdiction over 
TWC’s Petition because it is a request for preemption of state decisions on issues assigned by statute 
specifically to states for review.54 TWC filed its petition as a request for declaratory ruling requesting 
clarification of the interpretation of the 1996 Act pursuant to section 1.2 of the Commission’s rules.55 As 
such, the Commission’s authority over particular state decisions is not at issue here. And in any event, the 
Act establishes – and courts have confirmed – the primacy of federal authority with regard to several of the 
local competition provisions in the 1996 Act.  First, section 201(b) authorizes the Commission to 
“prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions 
of the Act.”56 As the Supreme Court has noted, this provision “explicitly gives the FCC jurisdiction to 
make rules governing matters to which the 1996 Act applies” – including issues addressed by section 251.57
Second, except in limited cases, the Commission’s authority with regard to the issues of local competition 
  
51 See, e.g., Developing a Unified Intercarrier Compensation Regime, Further Notice of Proposed Rulemaking, 
CC Docket No. 01-92, 20 FCC Rcd. 4685 (2005).  
52 IP-Enabled Services, 20 FCC Rcd at 10245.  Similarly, we disagree with the assertions that it is necessary to 
complete the proceedings pending in the IP-enabled services, intercarrier compensation, and universal service 
dockets in order to take action on or instead of taking action on this Petition.  See, e.g., NTCA Reply Comments 
at 5-6.
53 See, e.g., Verizon Comments at 2 (stating that one of the wholesale services it provides to Time Warner 
Cable is “administration, payment, and collection of intercarrier compensation”); Sprint Nextel Comments 
at 5 (offering to provide for its wholesale customers “intercarrier compensation, including exchange access 
and reciprocal compensation”).
54 SENTCO Comments at 8.
55 47 C.F.R. § 1.2.
56 47 U.S.C. § 201(b). 
57  BellSouth Telecommunications, Inc. Request for Declaratory Ruling that State Commissions May Not Regulate 
Broadband Internet Access Services by Requiring BellSouth to Provide Wholesale or Retail Broadband Services to 
Competitive LEC UNE Voice Customers, WC Docket No. 03-251, Memorandum Opinion and Order and Notice of 
Inquiry, 20 FCC Rcd 6830, 6841, para. 22 (2005) (BellSouth DSL Order) (quoting AT&T Corp. v. Iowa Utils. Bd., 
525 U.S. 366, 380 (1999) (emphasis in original)).  
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specified in section 251 supersede state jurisdiction over these matters.58 In the Supreme Court’s words, 
“the question . . . is not whether the Federal Government has taken the regulation of local 
telecommunications competition away from the States.  With regard to the matters addressed by the 1996 
Act, it unquestionably has.”59  In clarifying existing statutory requirements under the Act as interpreted by 
the Commission, however, the Commission’s decision may affect state decisions if state commissions have 
differing interpretations of the statute.  
19. Notice.  We disagree with the assertion that the Petition should be dismissed because TWC did 
not serve the Petition on the Nebraska Commission.60 We do not read the Petition for Declaratory Ruling 
as a request for preemption of a particular order that would trigger this requirement.  In its Petition, TWC 
requests that the Commission make a statement clarifying the conflicting interpretations among the states 
concerning wholesale carriers’ rights under sections 251(a) and (b).  Although TWC specifically describes 
the decisions of the Nebraska Commission and South Carolina Commission in its argument, this Petition 
for Declaratory Ruling does not request state preemption and we do not make any determination about 
whether to preempt any specific state decisions.  As such, there is no notice requirement at issue.  
IV. ORDERING CLAUSES
20. Accordingly, IT IS ORDERED, pursuant to sections 1, 3, 4, 201-205, 251, and 252 of the 
Communications Act, as amended, 47 U.S.C. §§ 151, 153, 154, 201-205, 251, and 252, and authority 
delegated under sections 0.91 and 0.291 of the Commission’s rules, 47 C.F.R. §§ 0.91 and 0.291, that the 
petition for declaratory ruling filed by Time Warner Cable in WC Docket No. 06-55 IS GRANTED to the 
extent described by this Order.
  
58 The Act, for example, expressly assigns to the states the authority to arbitrate interconnection disputes between 
carriers and incumbent LECs and, subject to the general framework set forth by the Commission, to establish 
appropriate rates for competitive carriers’ use of unbundled network elements.  See generally 47 U.S.C. § 252.  
59  AT&T Corp. v. Iowa Utils. Bd., 525 U.S. 366, 379 n.6 (1999).  See also Southwestern Bell Tel. Co. v. Connect 
Communications Corp., 225 F.3d 942, 946-47 (8th Cir. 2000) (“The new regime for regulating competition in this 
industry is federal in nature . . . and while Congress has chosen to retain a significant role for the state 
commissions, the scope of that role is measured by federal, not state law.”); Pacific Bell v. Pac-West Telecomm, 
Inc., 325 F.3d 1114, 1127 (9th Cir. 2003) (“[T]he Act limited state commissions’ authority to regulate local 
telecommunications competition.”) (emphasis in original); MCI Telecom Corp. v. Illinois Bell, 222 F.3d 323, 342-
43 (7th Cir. 2000) (stating, “with the 1996 Telecommunications Act . . . Congress did take over some aspects of 
the telecommunications industry,” and “Congress, exercising its authority to regulate commerce has precluded all 
other regulation except on its terms”).  Moreover, as the D.C. Circuit has held, the Commission is entitled to 
Chevron deference when applying the definition of “telecommunications carrier” in the context of a wholesale 
service provider.  Virgin Islands, 198 F.3d at 926 (citing Chevron U.S.A. Inc. v. Natural Resources Council, Inc., 
467 U.S. 837, 843 (1984)).
60 Nebraska Commission Comments at 7-8.  The Nebraska Commission argues that the Petition effectively seeks to 
preempt state or local regulatory authority.  As such, pursuant to Note 1 in section 1.1206(a) of the Commission’s 
rules, the Nebraska Commission asserts that TWC is required to serve the original petition on the state “the actions 
of which are specifically cited as a basis for requesting preemption.”  47 C.F.R. § 1.1206(a) NOTE 1 TO
PARAGRAPH.
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21. IT IS FURTHER ORDERED, pursuant to section 1.103(a) of the Commission’s rules, 47 
C.F.R. § 1.103(a), that this Memorandum Opinion and Order SHALL BE EFFECTIVE upon release.
FEDERAL COMMUNICATIONS COMMISSION
Thomas J. Navin
Chief, Wireline Competition Bureau 
Federal Communications Commission  DA 07-709
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LIST OF COMMENTERS
WC Docket No. 06-55
Commenter Abbreviation
Advance-Newhouse Communications Advance-Newhouse
Alpheus Communications, L.P.
PAETEC Communications, Inc.
U.S. Telepacific Corp. D/B/A Telepacific Communications
Alpheus et al. 
AT&T Inc. AT&T
Bridgecom International, Inc. 
Broadview Networks, Inc.
CTC Communications Corp.
NuVox Communications
Xspedius Communications LLC
COMPTEL
Bridgecom et al. 
Broadwing Communications, LLC
Fibertech Networks, LLC
Integra Telecom, Inc.
Lightyear Communications, Inc.
McLeodUSA Telecommunications Services, Inc.
Mpower Communications Corp.
Norlight Telecommunications, Inc.
Pac-West Telecomm, Inc.
Broadwing et al. 
Comcast Corporation Comcast
Global Crossing North America, Inc. Global Crossing
Home Telephone Company, Inc.
BPT, Inc. 
HTC/BPT
Independent Telephone and Telecommunications Alliance
National Exchange Carrier Association, Inc.
National Telecommunications Cooperative Association
The Organization for the Promotion and Advancement of Small 
 Telecommunications Companies
ITTA et al.
Iowa RLEC Group Iowa RLEC
Iowa Utilities Board IUB
John Staurulakis, Inc. JSI
Level 3 Communications, LLC Level 3
National Cable & Telecommunications Association NCTA
Nebraska Public Service Commission Nebraska Commission 
Neutral Tandem, Inc. Neutral Tandem
Pennsylvania Public Utility Commission Pennsylvania Commission
Pine Tree Networks PTN
Qwest Communications International Inc. Qwest
South Carolina Cable Television Association SCCTA
South Carolina Telephone Coalition SCTC
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South Dakota Telecommunications Association
Townes Telecommunications, Inc.
ITS Telecommunications Systems, Inc.
Public Service Telephone Company
Smart City Telecom
South Slope Cooperative Telephone Co., Inc.
Yadkin Valley Telephone Membership Corporation 
SDTA et al.
Southeast Nebraska Telephone Company 
The Independent Telephone Companies
SENTCO
Sprint Nextel Corporation Sprint Nextel
TCA, Inc. TCA
Time Warner Cable TWC
Verizon Verizon
Voice On The Net (VON) Coalition VON
Western Telecommunications Alliance WTA
LIST OF REPLY COMMENTERS
WC Docket No. 06-55
Commenter Abbreviation
Advance-Newhouse Communications Advance-Newhouse
Berkeley Cable TV and PBT Cable Services Berkeley and PBT
Bridgecom International, Inc. 
Broadview Networks, Inc. 
CTC Communications Corp. 
NuVox Communications
Xspedius Communications LLC
COMPTEL
Bridgecom et al. 
Broadwing Communications, LLC
Fibertech Networks, LLC
Integra Telecom, Inc. 
Lightyear Communications, Inc.
McLeodUSA Telecommunications Services, Inc. 
Mpower Communications Corp. 
Norlight Telecommunications, Inc. 
Pac-West Telecomm, Inc.
Broadwing et al. 
Earthlink, Inc. Earthlink
General Communication, Inc. GCI
Home Telephone Company, Inc. and PBT, Inc. HTC/PBT
John Staurulakis, Inc. JSI
Level 3 Communications, LLC Level 3
Midcontinent Communications Midcontinent
National Cable & Telecommunications Association NCTA
National Telecommunications Cooperative Association NTCA
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Nebraska Public Service Commission Nebraska Commission 
Neutral Tandem, Inc. Neutral Tandem
Rock Hill Telephone Company d/b/a Comporium
Lancaster Telephone Company d/b/a Comporium Communications
Fort Mill Telephone Company d/b/a Comporium Communications 
Comporium 
South Carolina Cable Television Association SCCTA
South Carolina Telephone Coalition SCTC
Southeast Nebraska Telephone Company 
The Independent Telephone Companies
SENTCO
Southern Communications Service, Inc. d/b/a SouthernLINC Wireless SouthernLINC Wireless
Sprint Nextel Corporation Sprint Nextel
Time Warner Cable TWC
T-Mobile USA, Inc. T-Mobile
United States Telecom Association USTA
Verizon Verizon