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 NEWS  News  media  Information  202  /  418-  0500  TTY  202  /  418-  2555  Fax-  On-  Demand  202  /  418-  2830  Internet:  http://  www.  fcc.  gov  ftp.  fcc.  gov  Federal  Communications  Commission  445  12  th  Street,  S.  W.  Washington,  D.  C.  20554  This  is  an  unofficial  announcement  of  Commission  action.  Release  of  the  full  text  of  a  Commission  order  constitutes  official  action.  See  MCI  v.  FCC.  515  F  2d  385  (D.  C.  Circ  1974).  FOR  IMMEDIATE  RELEASE:  NEWS  MEDIA  CONTACT: 
 May  15,  2003  Michael  Balmoris  202-  418-  0253  Email:  mbalmori@  fcc.  gov 
 FCC  SEEKS  COMMENT  ON  LONG  DISTANCE  INDUSTRY  REGULATIONS 
 Action  Aims  to  Address  Rules  Related  to  Local  Phone  Companies  Offering  Long  Distance  Service 


 Washington,  D.  C.  –  The  Federal  Communications  Commission  (FCC)  today  launched  a  proceeding  focused  on  the  regulatory  framework  for  local  phone  companies 
 offering  long  distance  service.  The  Further  Notice  of  Proposed  Rulemaking  (FNPRM)  seeks  comment  on  the  regulatory  classification  of  Bell  Operating  Companies  (BOCs)  and 
 independent  local  exchange  carriers  (LECs),  if  and  when  these  carriers  provide  in-  region,  interstate  and  international,  interexchange  services  outside  of  a  separate  affiliate. 


 Once  a  BOC  is  authorized  under  section  271  of  the  Telecommunications  Act  of  1996  (1996  Act)  to  provide  in-  region,  long  distance  service,  it  is  subject  to  statutory 
 separate  affiliate  requirements  designed  to  address  potential  discrimination  and  cost  misallocation.  These  section  272  separate  affiliate  requirements  sunset  in  each  state,  as 
 prescribed  by  the  1996  Act,  three  years  after  a  BOC  gains  permission  to  provide  long  distance  in  an  in-  region  state,  unless  extended  by  the  FCC.  The  separate  affiliate 
 requirements  sunset  for  Verizon  in  New  York  in  December  2002.  The  next  potential  sunset  date  is  for  SBC  in  Texas  in  June  2003. 


 When  a  BOC  or  independent  LEC  provides  in-  region,  long  distance  services  on  an  integrated  basis  (i.  e.,  without  a  separate  affiliate),  it  is  subject  to  dominant  carrier 
 regulation,  which  is  a  regulatory  framework  that  the  FCC  adopted  in  the  1980s  to  distinguish  AT&  T’s  pre-  divestiture  market  power  from  new  entrants.  Under  dominant 
 carrier  regulation,  carriers  are  required  to  file  tariffs  with  supporting  documentation  for  the  service  in  question. 


 Since  then,  the  long  distance  market  has  been  marked  by  dynamic,  competitive  activity.  For  example,  as  of  2002,  AT&  T’s  household  market  share  in  the  long  distance 
 market  was  slightly  less  than  37%,  MCI’s  share  was  slightly  less  than  16%,  Sprint’s  share  was  slightly  less  than  8%,  the  BOC  long  distance  affiliates’  share  is  over  15%,  and  24% 
 of  the  market  belonged  to  other  long  distance  carriers,  according  to  the  FCC’s  latest  report  on  the  long  distance  industry. 
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 on  the  Commission’s  web  site  www.  fcc.  gov. 
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