Voice Telephone Services: Status as of June 30, 2015 Industry Analysis and Technology Division Wireline Competition Bureau August 2016 This report is available for reference in the FCC’s Reference Information Center, Courtyard Level, 445 12th Street, SW, Washington, DC. Copies may be purchased by contacting Best Copy and Printing, Inc., 445 12th Street, SW, Room CY-B402, Washington, DC 20554, telephone (800) 378-3160, or via their website at www.bcpiweb.com. The report can also be downloaded from the Voice Telephone Services Reports webpage at https://www.fcc.gov/general/iatd-data-statistical-reports. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 i Table of Contents Introduction ........................................................................................................................................... 1 Comparison to Local Telephone Competition Report ....................................................................... 1 Retail Voice Telephone Service Connections ...................................................................................... 2 Figure 1 Retail Voice Telephone Service Connections, 2012-2015 ........................................ 2 Figure 2 Wireline Retail Voice Telephone Service Connections by Technology, Regulatory Status, and Customer Type as of June 30, 2015 ..................................... 3 Retail Service Relationships ................................................................................................................. 4 Figure 3 Interconnected VoIP Subscribership by Reported Service Features, Regulatory Status, and Customer Type as of June 30, 2015 ..................................... 5 Figure 4 Retail Relationships of Wireline Voice Telephone Service with Internet Access Service by Regulatory Status as of June 30, 2015 ........................... 6 Detailed Voice Telephone Services Data ............................................................................................ 7 Table 1 Voice Subscriptions – Total for US ........................................................................... 8 Table 2 Number of Providers Reporting Voice Subscriptions – Total for US .................... 10 Technical Notes ................................................................................................................................... 12 Glossary ............................................................................................................................................... 13 SUPPLEMENTAL MATERIALS AVAILABLE ON FCC WEBSITE - Table 1 and Table 2 in Excel format (national-level data back to June 2014) - State-level Subscriptions table in Excel format (data back to June 2014) - State-level Number of Providers table in Excel format (data back to June 2014) - County-level Subscriptions information in Excel format (data back to June 2014) - CSV-format file of consistent data series published for 2008-2015 - Crosswalk to the report Local Telephone Competition: Status as of December 31, 2013 in PDF format U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 1 Voice Telephone Services: Status as of June 30, 2015 Introduction The Commission has used FCC Form 477 to collect subscribership information from providers of voice telephone services – the incumbent local exchange carriers (ILECs), competitive local exchange carriers (CLECs), and mobile voice providers – since December 1999. The Commission has required interconnected Voice over Internet Protocol (“interconnected VoIP”) service providers to report subscribership information since December 2008 because the use of VoIP technology is growing rapidly and it increasingly is used to provide voice telephone service.1 Also, starting with the data reported for 2014, Form 477 has been modified to distinguish “over-the-top” (colloquially, “bring your own broadband”) interconnected VoIP subscriptions from other interconnected VoIP subscriptions.2 This report summarizes the information collected about telephone services as of June 30, 2015. It demonstrates continued growth in subscribership to interconnected VoIP and mobile voice services and continued decline in subscribership to traditional wired telephone services.3 Comparison to Local Telephone Competition Report This report previously was titled Local Telephone Competition. Reports under the earlier title summarized Form 477 data through December 31, 2013. Reports under the current title provide much of the summarized data as supplemental spreadsheet files, available at https://www.fcc.gov/voice-telephone- services-report. A crosswalk between data elements in this report and data elements in the Local Telephone Competition report is available at that page. 1 The FCC’s rules (at 47 C.F.R. § 9.3) state: An interconnected Voice over Internet Protocol (VoIP) service is a service that: (1) Enables real-time, two-way voice communications; (2) Requires a broadband connection from the user’s location; (3) Requires Internet protocol-compatible customer premises equipment (CPE); and (4) Permits users generally to receive calls that originate on the public switched telephone network and to terminate calls to the public switched telephone network. We note that the current interpretation of element (4) of the definition excludes the VoIP services that Skype offers in the United States, and subscribers to those services are not reported on Form 477. 2 The Technical Notes and the Glossary that appear at the end of this report provide more-detailed information about the current Form 477 and the meaning of terms used in this report. To be consistent with modifications to Form 477 that were adopted in 2013 (to be effective for reporting June 2014 and later data), and to avoid confusion, this report no longer uses the terms “standalone VoIP” and, by contrast, “broadband bundle.” Standalone VoIP in the earlier, Local Telephone Competition, reports has a different meaning from “over-the-top” VoIP in this report. In particular, subscriptions reported as standalone VoIP for December 2013 and earlier dates included over-the-top subscriptions as defined in this report and also video-plus-VoIP service subscriptions sold by cable TV system operators and other entities that own last-mile facilities to end-user premises. We note that, accordingly, 13% of total interconnected VoIP subscriptions were categorized as standalone VoIP in December 2013 and, by contrast, 10% of total interconnected VoIP subscriptions were categorized as over-the-top VoIP in December 2014. 3 The presentation of mobile wireless telephone subscriber counts in this report does not constitute, or imply, Commission analysis of the extent to which wireline and mobile wireless telephone services are demand substitutes or complements in general or in any particular situation. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 2 Retail Voice Telephone Service Connections Retail voice telephone service customers are served by two wireline technologies – “end-user” switched access lines and interconnected VoIP “subscriptions” – and by mobile wireless subscriptions. ? In June 2015, there were 68 million end-user switched access lines in service, 57 million interconnected VoIP subscriptions, and 326 million mobile subscriptions in the United States, or 451 million retail voice telephone service connections in total. See Figure 1. ? Over the three-year period presented in Figure 1, interconnected VoIP subscriptions increased at a compound annual growth rate of 13%, mobile voice subscriptions increased at a compound annual growth rate of 3%, and retail switched access lines declined at 13% per year.4 Figure 1 Retail Voice Telephone Service Connections, 2012 - 2015 (in Thousands) ? Of the 125 million wireline retail voice telephone service connections (including both switched access lines and interconnected VoIP subscriptions) in June 2015, 69 million (or 55%) were residential connections and 56 million (or 45%) were business connections.5 See Figure 2. 4 The compound annual growth rate (CAGR) is a smoothed rate of growth calculated in three steps. First, divide the ending (June 2015) value by the beginning (June 2012) value. Second, raise the result of that division to a power equal to one divided by the number of years in the period (in this case, 3 years, so the power is 1/3). Third, subtract the number one from the result of the second step. 5 FCC Form 477 does not distinguish between residential and business subscribers to mobile voice service. The information that Form 477 collects about mobile broadband service is summarized elsewhere; see Internet Access Services: Status as of June 30, 2015, available at https://www.fcc.gov/reports-research/reports/internet-access- services-reports/internet-access-services-reports. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 3 Figure 2 Wireline Retail Voice Telephone Service Connections by Technology, Regulatory Status, and Customer Type as of June 30, 2015 (in Thousands) Total Switched Access Interconnected Total Lines VoIP ILEC 54,639 12,233 66,872 Non-ILEC 13,458 44,518 57,976 Total 68,097 56,750 124,848 Residential ILEC 27,915 9,974 37,888 Non-ILEC 1,853 29,117 30,970 Residential Total 29,767 39,091 68,858 Business ILEC 26,724 2,259 28,983 Non-ILEC 11,606 15,400 27,006 Business Total 38,330 17,659 55,989 Figures may not sum to totals due to rounding. ILEC = Incumbent local exchange carrier. A voice-service affiliate of an ILEC that is operating outside the ILEC’s traditional service area (“study area”) is a Non-ILEC. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 4 ? Cross-classified by technology and the retailer’s regulatory status in Figure 2, the 69 million wireline residential connections in June 2015 were: 41% ILEC switched access lines, 42% non- ILEC interconnected VoIP subscriptions, 14% ILEC interconnected VoIP subscriptions, and 3% non-ILEC switched access lines. Similarly, the 56 million wireline business connections were: 48% ILEC switched access lines, 28% non-ILEC interconnected VoIP subscriptions, 4% ILEC interconnected VoIP subscriptions, and 21% non-ILEC switched access lines. Retail Service Relationships The revised Form 477 program collects two types of information about retail service relationships. ? Interconnected VoIP service retailers distinguish over-the-top (“OTT”) interconnected VoIP subscriptions—which, in the revised Form 477 program, means that the VoIP service end user has purchased (or has use of) a broadband connection from an entity that is not affiliated with the VoIP service retailer—by contrast to all other interconnected VoIP subscriptions. See Figure 3. ? Retailers of switched access lines and retailers of interconnected VoIP service distinguish between sales to end users who do not also purchase Internet access from them (including affiliates) and sales to end users who do purchase both these services. See Figure 4. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 5 Figure 3 Interconnected VoIP Subscribership by Reported Service Features, Regulatory Status, and Customer Type as of June 30, 2015 (in Thousands) Total Over-the-Top All Other Total (OTT) VoIP ILEC 37 12,196 12,233 Non-ILEC 5,318 39,200 44,518 Total 5,354 51,396 56,750 Residential ILEC 33 9,940 9,974 Non-ILEC 2,616 26,502 29,117 Residential Total 2,649 36,442 39,091 Business ILEC 3 2,256 2,259 Non-ILEC 2,702 12,699 15,400 Business Total 2,705 14,954 17,659 Figures may not sum to totals due to rounding. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 6 Figure 4 Retail Relationships of Wireline Voice Telephone Service with Internet Access Service by Regulatory Status as of June 30, 2015 (in Thousands) Total Sold to End Users ILEC Non-ILEC Total Switched Access Lines 54,639 13,458 68,097 Over-the-Top VoIP 37 5,318 5,354 All Other VoIP 12,196 39,200 51,396 Total 66,872 57,976 124,848 Internet Also Sold Switched Access Lines 20,003 3,567 23,570 Over-the-Top VoIP 0 0 0 All Other VoIP 12,169 34,585 46,754 Both Sold Total 32,172 38,152 70,324 Internet Not Also Sold Switched Access Lines 34,636 9,891 44,527 Over-the-Top VoIP 37 5,318 5,354 All Other VoIP 27 4,615 4,642 Only Voice Total 34,700 19,824 54,524 Figures may not sum totals due to rounding. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 7 Detailed Voice Telephone Services Data The remainder of this document consists of national information, technical notes, and a glossary of terms. ? Table 1 summarizes national-level voice telephone service subscription data for June 2015, and also for December and June 2014, for individual data elements collected by FCC Form 477. ? Table 2 shows the number of entities that reported the national-level subscription data for June 2015, and also for December and June 2014. Table 1 and Table 2 are available in Excel format at https://www.fcc.gov/voice-telephone-services-report. Also available at that page are: ? State-level Subscriptions table in Excel format (data back to June 2014) ? State-level Number of Providers table in Excel format (data back to June 2014) ? County-level Subscriptions information in Excel format (data back to June 2014) ? CSV-format file of the consistent data series that are available back to December 2008, when interconnected VoIP retailers were first required to report subscription information on Form 477. Earlier data, back to December 1999, are available in the Local Telephone Competition reports at https://www.fcc.gov/general/local-telephone-competition-reports. However, researchers who consider using the complete data series for trend analysis should recall the discontinuities in the data that arise from Form 477 modifications over time. ? Between December 1999 and December 2004, Form 477 collected state-by-state data only from local exchange carriers with at least 10,000 end-user switched access lines in service in the state, and from facilities-based mobile voice carriers with at least 10,000 mobile voice subscriptions in service in the state. ? Prior to December 2008, interconnected VoIP service retailers were not required to submit Form 477, but an unknown amount of interconnected VoIP service was included along with the switched access lines reported by some Form 477 filers. ? As discussed earlier in this report, the category standalone interconnected VoIP that was reported from December 2008 to December 2013 is different (that is, includes more subscriptions) than the category over-the-top interconnected VoIP that is reported starting with the June 2014 data.6 6 See footnote 2, above. Reference Data element June 2015 Dec 2014 June 2014 1 Mobile telephony 326,494 322,527 314,489 2     Directly-billed or prepaid 286,479 283,316 276,800 3     Not directly-billed or prepaid 40,015 39,210 37,690 4 Wireline End-User Switched Access Lines and Interconnected VoIP Subscriptions 124,848 126,844 127,951 5     Incumbent LECs 66,872 69,382 71,829 6     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 57,976 57,462 56,122 7     Consumer-grade service 68,858 70,233 71,492 8         Incumbent LECs 37,888 39,433 41,044 9         Other (Non-ILECs) 30,970 30,800 30,447 10     Business & Government-grade service 55,989 56,610 56,459 11         Incumbent LECs 28,983 29,949 30,785 12         Other (Non-ILECs) 27,006 26,661 25,674 13 Local exchange telephone service (Switched Access Lines) 68,097 72,605 76,967 14     Incumbent LECs 54,639 58,045 61,573 15     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 13,458 14,560 15,393 16     Consumer-grade service 29,767 32,000 34,460 17         Incumbent LECs 27,915 29,937 32,223 18         Other (Non-ILECs) 1,853 2,063 2,237 19     Business & Government-grade service 38,330 40,605 42,507 20         Incumbent LECs 26,724 28,108 29,351 21         Other (Non-ILECs) 11,606 12,497 13,156 22 Interconnected VoIP Subscriptions - Note:  Includes both Over-the-top (OTT) and All Other sub-categories. 56,750 54,238 50,984 23     Incumbent LECs 12,233 11,336 10,256 24     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 44,518 42,902 40,728 25     Consumer-grade service 39,091 38,234 37,032 26         Incumbent LECs 9,974 9,496 8,822 27         Other (Non-ILECs) 29,117 28,738 28,210 28     Business & Government-grade service 17,659 16,005 13,952 29         Incumbent LECs 2,259 1,841 1,434 30         Other (Non-ILECs) 15,400 14,164 12,518 31 Over-the-top interconnected VoIP 5,354 5,150 5,087 32     Incumbent LECs 37 28 34 33     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 5,318 5,121 5,053 34     Consumer-grade service 2,649 2,882 3,018 35         Incumbent LECs 33 26 31 36         Other (Non-ILECs) 2,616 2,855 2,987 37     Business & Government-grade service 2,705 2,268 2,068 38         Incumbent LECs 3 2 2 39         Other (Non-ILECs) 2,702 2,266 2,066 40 All Other interconnected VoIP 51,396 49,089 45,898 41     Incumbent LECs 12,196 11,308 10,222 42     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 39,200 37,781 35,675 43     Consumer-grade service 36,442 35,352 34,014 44         Incumbent LECs 9,940 9,469 8,791 45         Other (Non-ILECs) 26,502 25,883 25,223 46     Business & Government-grade service 14,954 13,737 11,884 47         Incumbent LECs 2,256 1,839 1,432 48         Other (Non-ILECs) 12,699 11,898 10,452 49 Local exchange telephone service by last-mile delivery medium 68,097 72,605 76,967 50     Fiber-to-the-premises 5,460 5,425 5,308 Table 1. Voice Subscriptions (in Thousands) - Total for US             U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 8 Reference Data element June 2015 Dec 2014 June 2014 Table 1. Voice Subscriptions (in Thousands) - Total for US 51         Incumbent LECs 3,466 3,443 3,319 52         Other (Non-ILECs) 1,993 1,982 1,990 53     Coaxial cable 1,417 1,194 1,344 54         Incumbent LECs 60 65 49 55         Other (Non-ILECs) 1,357 1,128 1,295 56     Terrestrial fixed wireless 545 582 579 57         Incumbent LECs 536 549 546 58         Other (Non-ILECs) 9 33 33 59     Copper local loop 60,676 65,404 69,735 60         Incumbent LECs 50,576 53,988 57,659 61         Other (Non-ILECs) 10,099 11,416 12,076 62 All Other interconnected VoIP by last-mile delivery medium 51,396 49,089 45,898 63     Fiber-to-the-premises 7,010 6,226 5,977 64         Incumbent LECs 5,163 4,941 4,724 65         Other (Non-ILECs) 1,847 1,285 1,254 66     Coaxial cable 32,286 31,557 30,231 67         Incumbent LECs 5 4 3 68         Other (Non-ILECs) 32,281 31,552 30,227 69     Terrestrial fixed wireless or satellite 68 67 82 70         Incumbent LECs 1 0 0 71         Other (Non-ILECs) 67 67 81 72     Copper local loop 12,032 11,239 9,608 73         Incumbent LECs 7,027 6,362 5,495 74         Other (Non-ILECs) 5,005 4,877 4,113 75 Non-Incumbent LEC local exchange telephone service by means of provisioning 13,458 14,560 15,393 76         Provided over owned last-mile facilities 4,674 4,852 5,257 77         Provided over UNE-L obtained from unaffiliated entity 2,368 3,270 3,645 78         Provided over other services obtained from unaffiliated entity 6,416 6,438 6,492 79 Incumbent LEC local exchange telephone service provided to unaffiliated carriers for resale 6,091 6,266 6,421 80         Wholesale lines 3,667 3,750 3,795 81         UNE-L 2,424 2,516 2,626 82 Local exchange telephone service and long-distance service 68,097 72,605 76,967 83     Consumer-grade service 29,767 32,000 34,460 84         Incumbent LEC is preferred long-distance carrier for its local exchange service customer 18,117 19,480 20,937 85         Incumbent LEC is not preferred long-distance carrier for its local exchange service customer 9,797 10,457 11,286 86         Non-ILEC is preferred long-distance carrier for its local exchange service customer 1,577 1,725 1,789 87         Non-ILEC is not preferred long-distance carrier for its local exchange service customer 275 337 448 88     Business & Government-grade service 38,330 40,605 42,507 89         Incumbent LEC is preferred long-distance carrier for its local exchange service customer 14,330 15,122 15,736 90         Incumbent LEC is not preferred long-distance carrier for its local exchange service customer 12,394 12,986 13,614 91         Non-ILEC is preferred long-distance carrier for its local exchange service customer 8,852 9,534 9,983 92         Non-ILEC is not preferred long-distance carrier for its local exchange service customer 2,754 2,964 3,173 93 End user buys local exchange telephone service and Internet access service from same entity 23,570 25,095 26,974 94         End user buys both services from incumbent LEC or affiliates 20,003 21,409 22,640 95         End user buys both services from Non-ILEC or affiliates 3,567 3,686 4,334 96 End user buys interconnected VoIP and Internet access service from same entity 46,754 43,456 42,072 97         End user buys both services from incumbent LEC or affiliates 12,169 11,285 10,202 98         End user buys both services from Non-ILEC or affiliates 34,585 32,171 31,871             U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 9 Reference Data element June 2015 Dec 2014 June 2014 1 Mobile telephony 140 148 150 2     Directly-billed or prepaid 138 145 147 3     Not directly-billed or prepaid 26 28 27 4 Wireline End-User Switched Access Lines and Interconnected VoIP Subscriptions 1,616 1,584 1,545 5     Incumbent LECs 741 742 744 6     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 1,132 1,092 1,050 7     Consumer-grade service 1,239 1,233 1,230 8         Incumbent LECs 740 741 743 9         Other (Non-ILECs) 745 729 723 10     Business & Government-grade service 1,505 1,468 1,428 11         Incumbent LECs 735 736 738 12         Other (Non-ILECs) 1,024 977 934 13 Local exchange telephone service (Switched Access Lines) 1,027 1,040 1,033 14     Incumbent LECs 738 740 740 15     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 507 513 506 16     Consumer-grade service 919 927 930 17         Incumbent LECs 738 740 740 18         Other (Non-ILECs) 393 393 397 19     Business & Government-grade service 1,001 1,006 993 20         Incumbent LECs 733 735 734 21         Other (Non-ILECs) 484 481 467 22 Interconnected VoIP Subscriptions - Note:  Includes both Over-the-top (OTT) and All Other sub-categories. 901 848 797 23     Incumbent LECs 85 78 75 24     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 865 818 765 25     Consumer-grade service 484 469 450 26         Incumbent LECs 45 41 39 27         Other (Non-ILECs) 457 445 426 28     Business & Government-grade service 800 749 707 29         Incumbent LECs 80 74 73 30         Other (Non-ILECs) 767 720 674 31 Over-the-top interconnected VoIP 471 429 397 32     Incumbent LECs 17 13 13 33     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 463 424 391 34     Consumer-grade service 147 129 122 35         Incumbent LECs 9 6 7 36         Other (Non-ILECs) 140 125 117 37     Business & Government-grade service 422 392 364 38         Incumbent LECs 14 11 11 39         Other (Non-ILECs) 417 389 360 40 All Other interconnected VoIP 602 575 552 41     Incumbent LECs 79 75 71 42     Other (Non-ILECs) - Note: ILEC voice-service affiliate operating outside ILEC's study area is included here. 570 545 521 43     Consumer-grade service 385 378 364 44         Incumbent LECs 40 38 35 45         Other (Non-ILECs) 363 356 343 46     Business & Government-grade service 534 500 485 47         Incumbent LECs 75 71 69 48         Other (Non-ILECs) 503 471 453 49 Local exchange telephone service by last-mile delivery medium 1,027 1,040 1,033 50     Fiber-to-the-premises 656 652 630 Table 2. Number of Providers Reporting Voice Subscriptions - Total for US             U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 10 Reference Data element June 2015 Dec 2014 June 2014 Table 2. Number of Providers Reporting Voice Subscriptions - Total for US 51         Incumbent LECs 518 504 483 52         Other (Non-ILECs) 290 292 282 53     Coaxial cable 92 91 91 54         Incumbent LECs 24 22 19 55         Other (Non-ILECs) 77 77 79 56     Terrestrial fixed wireless 70 75 71 57         Incumbent LECs 46 51 45 58         Other (Non-ILECs) 34 33 38 59     Copper local loop 885 885 890 60         Incumbent LECs 654 650 654 61         Other (Non-ILECs) 364 367 363 62 All Other interconnected VoIP by last-mile delivery medium 602 575 552 63     Fiber-to-the-premises 318 284 263 64         Incumbent LECs 60 54 46 65         Other (Non-ILECs) 290 259 241 66     Coaxial cable 216 210 200 67         Incumbent LECs 10 10 7 68         Other (Non-ILECs) 212 207 197 69     Terrestrial fixed wireless or satellite 176 168 167 70         Incumbent LECs 8 9 7 71         Other (Non-ILECs) 170 162 162 72     Copper local loop 214 215 200 73         Incumbent LECs 40 41 45 74         Other (Non-ILECs) 195 196 174 75 Non-Incumbent LEC local exchange telephone service by means of provisioning 507 513 506 76         Provided over owned last-mile facilities 346 350 343 77         Provided over UNE-L obtained from unaffiliated entity 134 125 128 78         Provided over other services obtained from unaffiliated entity 226 224 220 79 Incumbent LEC local exchange telephone service provided to unaffiliated carriers for resale 40 37 37 80         Wholesale lines 38 37 36 81         UNE-L 11 10 10 82 Local exchange telephone service and long-distance service 1,027 1,040 1,033 83     Consumer-grade service 919 927 930 84         Incumbent LEC is preferred long-distance carrier for its local exchange service customer 666 668 665 85         Incumbent LEC is not preferred long-distance carrier for its local exchange service customer 689 687 692 86         Non-ILEC is preferred long-distance carrier for its local exchange service customer 358 353 353 87         Non-ILEC is not preferred long-distance carrier for its local exchange service customer 279 275 277 88     Business & Government-grade service 1,001 1,006 993 89         Incumbent LEC is preferred long-distance carrier for its local exchange service customer 661 667 657 90         Incumbent LEC is not preferred long-distance carrier for its local exchange service customer 662 655 650 91         Non-ILEC is preferred long-distance carrier for its local exchange service customer 431 420 412 92         Non-ILEC is not preferred long-distance carrier for its local exchange service customer 315 323 311 93 End user buys local exchange telephone service and Internet access service from same entity 901 905 902 94         End user buys both services from incumbent LEC or affiliates 710 712 710 95         End user buys both services from Non-ILEC or affiliates 398 392 392 96 End user buys interconnected VoIP and Internet access service from same entity 551 521 503 97         End user buys both services from incumbent LEC or affiliates 70 65 62 98         End user buys both services from Non-ILEC or affiliates 520 493 475             U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 11 U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 12 Technical Notes General Detailed information about the current Form 477 reporting requirements is available at https://www.fcc.gov/general/form-477-resources-filers#block-menu-block-4. See Glossary for definitions of terms used in this report. Counting lines and subscribers ? Form 477 counts both switched access lines and interconnected VoIP subscriptions as the maximum number of calls that may be active, simultaneously, from the end user’s location under the purchased service plan. All VoIP subscriptions discussed in this report are interconnected VoIP subscriptions. ? Form 477 data may not count all VoIP phone connections to Internet Protocol Private Branch Exchange (IP PBX) equipment that is owned by business end users because of the variety of ways the IP PBX may connect to the public switched telephone network. Holding company-subsidiary relationships ? When counting service providers that report voice telephone service in a particular geography, we count a holding company or common-control entity no more than once in any specified sub- category of total providers. ? Nationwide counts of providers are unique counts for any specified sub-category of total providers (for example, all non-ILECs or all interconnected VoIP providers); an entity operating in multiple states is counted only once. ILEC-CLEC affiliations ? If a CLEC is affiliated with an ILEC and reports some end-user switched access lines or interconnected VoIP subscriptions in the ILEC’s service area in the state, then the switched access lines or interconnected VoIP subscriptions reported by the CLEC are allocated between the ILEC and non-ILEC categories based on staff estimates. Mobile voice subscriptions ? Commercial mobile radio service (CMRS) carriers that own or operate wireless networks report both their retail voice service subscriptions and the retail subscriptions of the mobile voice service resellers that use their network. Mobile voice service resellers do not file Form 477. UNE-Platform lines replaced by commercial agreements ? UNE-Platform (UNE-P) was the combination of ILEC loop UNE, switching UNE, and transport UNE. The Commission directed CLECs to migrate their retail customers served by UNE-P to an alternative arrangement within 12 months of the effective date of the Triennial Review Remand Order, that is, by March 11, 2006. See C.F.R. § 51.319(d)(2)(ii). Such lines are reported on Form 477 as ILEC wholesale lines provided to unaffiliated providers for resale. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 13 Glossary Term Definition All Other interconnected VoIP Interconnected VoIP service other than OTT interconnected VoIP. (See the definition of OTT VoIP, below.) Circuit switching A method of completing electronic communications in which a transmission path is established for dedicated use by a communication; the basis of the public switched telephone network (PSTN). Coaxial cable The technology widely used by cable system operators to terminate their services at the end user’s premises. Copper local loop The technology widely used by telephone companies to terminate their service at the end user’s premises. CLEC Competitive Local Exchange Carrier: A local exchange carrier (LEC) that operates within the traditional service area of an unaffiliated incumbent LEC. End users Residential, business, institutional, or government entities that use services for their own purposes and who do not resell such services to other entities. Fixed wireless service A radio communication service between specified fixed points. FTTP or FTTH Fiber to the Premises (Home): A network access architecture in which optical fiber is deployed all the way to the customer’s premises (home). Internet access service Service that provides end users access to the Internet. ILEC Incumbent Local Exchange Carrier: A company or cooperative that was providing telephone service in a localized area, typically on a monopoly basis, prior to enactment of the Telecommunications Act of 1996. Internet protocol or IP A language and set of formal rules that govern how packets transit the Internet. Interconnected VoIP or iVoIP A service that enables real-time, two-way voice communications; requires a broadband connection from the user’s location; requires Internet- protocol compatible customer premises equipment; and permits users generally to receive calls that originate on the public switched telephone network and to terminate calls to the public switched telephone network. LEC Local Exchange Carrier: A company that provides telephone service within a localized area and access services that connect its customers to long-distance (Interexchange Carrier) networks. Local loop The physical connection between the customer’s premises and the telephone company’s local switching office, typically provided using copper, fiber, or a combination of copper and fiber facilities. Mobile wireless service A radio communication service between mobile and fixed stations, or between mobile stations. U.S. Federal Communications Commission Voice Telephone Services: Status as of June 30, 2015 14 Non-ILEC Any provider of communications services who does not have ILEC regulatory status. A voice-service affiliate of an ILEC that is operating outside the ILEC’s traditional service area (“study area”) is a Non-ILEC. OTT interconnected VoIP Over-the-top interconnected VoIP: Service delivered to the end-user customer’s premises over a high-capacity connection that the customer obtains (that is, buys), or has the use of, from an entity not affiliated with the interconnected VoIP service provider. (Colloquially, “bring-your- own-broadband.”) PBX Private Branch Exchange: A communications switch that is owned or leased by the service provider’s end-user customer and generally located on the customer’s premises. Packet switching A method of completing electronic communications in which the information is disassembled into discrete packets that are transmitted independently and later reassembled; IP is an example. Retail wireline voice telephone service Switched access lines and interconnected VoIP subscriptions for which an end user is the customer. Switched access line A service connection between an end user and the local telephone company’s switch; the basis of plain old telephone service (POTS). UNE Unbundled Network Element: A physical or functional element of an ILEC network that must be provided to a CLEC at a cost-based price, as provide for in the Telecommunications Act of 1996. UNE-L UNE-Loop: An ILEC unbundled local loop provided to a CLEC at a cost-based price. Wholesale switched access lines Local telephone service provided to an unaffiliated telephone company, which resells the service to end users; typically provided by an ILEC to a CLEC. Customer Response Publication: Voice Telephone Services: Status as of June 30, 2015 You can help us provide the best possible information to the public by completing this form and returning it to the Industry Analysis and Technology Division of the FCC's Wireline Competition Bureau. 1. Please check the category that best describes you: ____ press ____ current telecommunications carrier ____ potential telecommunications carrier ____ business customer evaluating vendors/service options ____ consultant, law firm, lobbyist ____ other business customer ____ academic/student ____ residential customer ____ FCC employee ____ other federal government employee ____ state or local government employee ____ Other (please specify) 2. 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