Technology Transitions, Policies and Rules Governing Retirement of Copper Loops by Incumbent Local Exchange Carriers and Special Access for Price Cap Local Exchange Carriers

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 51 and 63

[GN Docket No. 13-5, RM-11358; WC Docket No. 05-25, RM-10593; FCC 15-97]

Technology Transitions, Policies and Rules Governing Retirement of Copper Loops by Incumbent Local Exchange Carriers and Special Access for Price Cap Local Exchange Carriers

AGENCY:

Federal Communications Commission.

ACTION:

Final rule.

SUMMARY:

The Commission initiated this rulemaking in January 2015 to help guide and accelerate the technological revolutions that are underway involving the transitions from networks based on TDM circuit-switched voice services running on copper loops to all-IP multi-media networks using copper, co-axial cable, wireless, and fiber as physical infrastructure. This rulemaking and order on reconsideration is only one of a series of Commission actions to protect core values and ensure the success of these technology transitions. In this item, we take steps to ensure that competition continues to thrive and to protect consumers during transitions. These steps will help to ensure that the technology transitions continue to succeed.

DATES:

Effective November 18, 2015, except for 47 CFR 51.325(a)(4) and (e), 51.332, and 51.333(b) and (c), which contain information collection requirements that have not been approved by OMB. The Federal Communications Commission will publish a document in the

Federal Register

announcing the effective date.

FOR FURTHER INFORMATION CONTACT:

Michele Levy Berlove, Wireline Competition Bureau, Competition Policy Division, (202) 418-1477, or send an email to

Michele.Berlove@fcc.gov.

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Report and Order and Order on Reconsideration in GN Docket No. 13-5, RM-11358, and WC Docket No. 05-25, RM-10593, FCC 15-97, adopted August 6, 2015 and released August 7, 2015. The full text of this document is available for public inspection during regular business hours in the FCC Reference Information Center, Portals II, 445 12th Street SW., Room CY-A257, Washington, DC 20554. It is available on the Commission's Web site at

http://www.fcc.gov.

Synopsis

I. Introduction

1. Communications networks are rapidly transitioning away from the historic provision of time-division multiplexed (TDM) services running on copper to new, all-Internet Protocol (IP) multimedia networks using copper, co-axial cable, wireless, and fiber as physical infrastructure. Our actions today further the technology transitions underway in our Nation's fixed communications networks that offer the prospect of innovative and improved services to consumers and businesses alike. The core goals of the January 2014

Technology Transitions Order

frame our approach here. In the

Technology Transitions Order,

we emphasized the importance of speeding market-driven technological transitions and innovations while preserving the core statutory values as codified by Congress: Competition, consumer protection, universal service, and public safety. Furthering these core values will accelerate customer adoption of technology transitions. Today, we take the next step in advancing longstanding competition and consumer protection policies on a technologically-neutral basis in order to ensure that the deployment of innovative and improved communications services can continue without delay.

2. Industry is investing aggressively in modern telecommunications networks and services. Overall, according to data supplied by USTelecom and AT&T, capital expenditures by broadband providers topped $75 billion in 2013 and continue to increase. AT&T recently announced that by the year 2020, 75 percent of its network will be controlled by software. To do this, AT&T is undergoing a massive effort to train about 130,000 of its employees on software-defined networking architecture and protocols. AT&T has also expanded its wireline IP broadband network to 57 million customer locations, as well as extended fiber to 725,000 business locations. Moreover, Verizon passes more than 19.8 million premises with its all-fiber network—the largest such network in the country—and it projects that soon about 70 percent of the premises in its landline territory will have access to all-fiber facilities. Verizon too has announced an SDN-based strategy “to introduce new operational efficiencies and allow for the enablement of rapid and flexible service delivery to Verizon's customers.” And CenturyLink has announced the launch of 1 Gbps broadband service to 16 cities. According to recent reports, CenturyLink's national fiber network upgrade has expanded availability of CenturyLink's gigabit broadband services to nearly 490,000 business locations. These are just a few of many examples in which industry is investing heavily to bring the benefits of new networks and services to customers of all sizes.

3. We recognize that the success of the technology transitions is dependent, among other things, on clear and certain direction from the Commission that preserves the historic values that Congress has incorporated in the Communications Act of 1934, as amended (the Act). In the November 2014

Notice of Proposed Rulemaking (NPRM),

80 FR 450, we sought comment on limited oversight that would encourage transitions that could otherwise be delayed if a portion of consumers were left behind or competition were allowed to diminish—recognizing that the transitions that are underway are organic processes without a single starting or stopping point. Building on that NPRM, in this item we support the transitions by adopting limited and targeted regulation to preserve competition and to protect consumers, especially those in vulnerable populations who have not yet voluntarily migrated from plain old telephone service (POTS) and other legacy services. In taking these steps, we seek to avoid the need for future regulation and dispute resolution that could cause delays down the road. Carriers involved in the historic transitions have made clear their intention to protect consumers and preserve a competitive marketplace going forward, and the pro-transition rules we adopt today are consistent with those mutually shared goals.

4. Building on our proposals in the

NPRM,

we adopt clear “rules of the road” to ensure that all consumers will enjoy the benefits of two distinct but related kinds of technology transitions: (1) Changes in network

facilities,

and in particular, retirement of copper facilities; and (2) changes that involve the discontinuance, impairment, or reduction of legacy

services,

irrespective of the network facility used to deliver those services. We summarize each of the actions that we take today below.

5.

Informing and Protecting Consumers as Networks and Services Change.

We take the following actions to ensure that consumers are able to make informed choices and that new retail services meet consumers' fundamental needs:

•

Copper Retirement:

We believe that the best balance is struck when consumers are informed, technological

progress is fully incented, and current networks are maintained while they are in use. To that end, we reaffirm our decision not to create an approval requirement for retirement of legacy facilities so long as the change of technology does not discontinue, reduce, or impair the services provided—ensuring that incumbent local exchange carriers (LECs) can continue to transition to an all-fiber environment. However, because our current network change rules do not take account of the needs of consumers for accurate information about the consequences of retirements of copper facilities, we provide simply that incumbent carriers (

i.e.,

incumbent LECs) must provide notice of planned copper retirements to retail customers when such retirements remove copper to the customers' premises, along with particular consumer protection measures. We define “copper retirement” so that incumbent LECs know when these responsibilities are triggered. The definition that we adopt will prevent copper facilities from being “

de facto

retired” without adequate notice to affected persons.

•

Service Discontinuance:

Congress has mandated, per Section 214 of the Act, that carriers must obtain our approval before they discontinue, reduce, or impair service to a community or part of a community. This discontinuance process allows the Commission to satisfy its obligation under the Act to protect the public interest and to minimize harm to consumers. For convenience, in certain circumstances this item uses “discontinue” (or “discontinuance,” etc.) as a shorthand that encompasses the statutory terms “discontinue, reduce, or impair,” unless the context indicates otherwise.

6.

Safeguarding the Public Interest by Preserving the Benefits of Competition.

Incumbent carriers compete with competitive carriers (

i.e.,

competitive LECs) to provide communications services to businesses, schools, healthcare facilities, government entities, and other organizations of all shapes and sizes. The competitive carriers often rely on a combination of their own facilities and the purchase of last-mile facilities and services from the incumbent carriers, such as unbundled network elements and special access services to provide business services. The organizations these carriers serve benefit from this competition in their purchase of communications services, which helps them serve their customers better and more efficiently. Within the subset of non-residential multi-location expenditures by companies with at least 250 employees, GeoResults estimated that in the third quarter of 2014 competitive LECs accounted for 32% of expenditures and non-LECs accounted for only 5% of expenditures. Through today's action, we are adopting policies to ensure competition thrives as our networks continue to transition. Specifically, we implement revisions to our copper retirement rules and our service discontinuance rules to ensure that: (i) Competitive carriers are adequately informed about technology changes that impact them; (ii) the interests of end users impacted by upstream changes in service by providers of wholesale inputs are adequately recognized as important to our service discontinuance process; and (iii) competitive carriers do not lose the access that they need to continue to provide the benefits of competition.

• We update the process by which incumbent LECs notify interconnecting entities of planned copper retirements. Among other things, we require incumbent LECs to provide at least six months' advance notice of proposed copper retirements to interconnecting carriers in order to provide such carriers adequate time to prepare their networks for the changes.

• To fulfill our statutory obligation to ensure that changes to telecommunications services that negatively affect the public occur with proper oversight, we clarify that a carrier must obtain Commission approval before discontinuing, reducing, or impairing a service used as a wholesale input, but only when the carrier's actions will discontinue, reduce, or impair service to end users, including a carrier-customer's retail end users. We emphasize that carriers must consider the impact of their actions on end user customers, including the end users of carrier-customers.

• The Commission has long intended to conduct a comprehensive evaluation of dedicated high-capacity connections used daily and intensively by businesses and institutions to transmit their voice and data traffic, known traditionally as “special access.” That evaluation will enable us to address critical long-term questions about the state of competition for business data connections and the role of regulation in facilitating competitive markets. Today, we adopt an interim rule to preserve competitive access while the special access proceeding remains pending and to maintain incentives for all parties to rapidly transition to IP. We conclude that to receive authority to discontinue, reduce, or impair a legacy TDM-based service that is used as a wholesale input by competitive providers, an incumbent LEC must as a condition to obtaining discontinuance authority commit to providing competitive carriers

II. Report and Order

A. Background

7. The Commission initiated this rulemaking in November 2014 to help guide and accelerate the technological revolutions that are underway involving the transitions from networks based on TDM circuit-switched voice services running on copper loops to all-IP multi-media networks using copper, co-axial cable, wireless, and fiber as physical infrastructure. This rulemaking is only one of a series of Commission actions to protect core values and ensure the success of these technology transitions. The Commission also is undertaking a comprehensive evaluation of the correct policies for the long-run concerning access to a key form of competitive inputs and technology change—special access. The Commission will use the data and public comment addressing the data to develop the long-term policies that will supersede the reasonably comparable wholesale access requirements adopted today. However, we recognize that for them to succeed, we need to ensure competition continues to thrive and we protect consumers, especially those in vulnerable populations, who rely on POTS and other legacy services.

8. Recent data indicates that 30 percent of all residential customers choose IP-based voice services from cable, fiber, and other providers as alternatives to legacy voice services. Moreover, 44 percent of households were “wireless-only” during January-June of 2014. The growth of “wireless-only” homes will necessitate more backhaul services than ever before, and these services are increasingly IP-based. Overall, almost 75 percent of U.S. residential customers (approximately 88 million households) no longer receive telephone service over traditional copper facilities. As consumer demand for faster service speeds continues, wireless providers and their customers have benefited from the transition to Ethernet, which is more easily scalable to increasing user demands compared to copper; and, by the end of 2014, certain incumbent LECs have dropped between 30 to 60 percent of their copper-based DS1 special access circuits, replacing these special access circuits with IP offerings. Similar change is occurring in the supply of mass-market services. Moreover, advancements in technology and interconnection have changed the relationship between broadband Internet access and Voice over Internet

Protocol (VoIP) applications such that users indiscriminately communicate between North American Numbering Plan (NANP) and IP endpoints on the public switched network.

9. At the same time, competitive carriers today continue to rely on incumbent LEC TDM-based DS1 and DS3 special access services to serve a large number of utility, residential, and enterprise customer locations throughout the United States. Commenters assert that many areas across the country have few viable alternatives to currently-available incumbent LEC copper loop or TDM-based wholesale inputs. Competitive LECs have submitted evidence in this record and in other proceedings that, in such areas, the prices incumbent LECs charge for these replacement wholesale inputs (

e.g.,

for 2 Mbps IP service) are significantly higher than a comparable service using a TDM-based service subject to a dominant carrier rate regulation.

10. The Commission received comments from over 65 parties in response to the

NPRM,

including incumbent and competitive carriers, and industry organizations representing wireless, cable, rural and communications equipment companies as well as consumer advocates, state public service commissions, and local government entities. And the National Telecommunications and Information Administration weighed in on behalf of the federal government, noting that “U.S. government departments and agencies . . . are among the largest customers of U.S. telecommunication service providers” and that the vagaries of the budgeting, appropriations, and procurement processes make it difficult for the government to accommodate transitions quickly. It thus noted the need for “careful planning while supporting continued growth and innovation in our communications networks.” These parties provided a wide range of arguments and legal analyses as well as relevant data and information on the important issues raised in the

NPRM

to help the Commission make informed findings and final rules. Despite their varying positions, all the parties recognize the significance of the technology transitions and the need to protect the enduring values of our communications network.

B. Discussion

1. Revision of Copper Retirement Processes To Facilitate Technology Transitions by Promoting Competition and Protecting Consumers

11. Today, we significantly update our copper retirement rules for the first time in over a decade to address the increasing pace of copper retirement and its implications for consumers and competition. We do so to facilitate the smoothest possible transition of the Nation's legacy communications networks to newer technologies while ensuring this transition happens free from the obstacles that might arise were this transition not handled responsibly. We believe the updated rules that we adopt today will benefit the entire ecosystem of industry and consumers by ensuring that everyone has the information they need to adapt to an evolving communications environment. Interconnecting entities will be able to accommodate the planned network changes without disruption of service to their customers. Competitive opportunities will be ensured, resulting in greater consumer choice. Government departments and agencies will not be left unable to respond to changes in the networks over which their vital communications services are provided. Customer confusion regarding the impact of planned copper retirements, and possible complaints arising from such confusion, will be minimized. And incumbent LECs will be able to move forward with highly beneficial planned network changes with greater comfort and certainty. Verizon, for instance, estimates that the cost of maintaining parallel copper facilities and the consumer welfare benefits from its existing fiber deployment each run in the hundreds of millions of dollars.

12. The Commission issued the current rules governing copper retirement in 2003 in the

Triennial Review Order

. At that time, fiber to the home deployment was in its infancy. In the intervening twelve years, however, incumbent LECs have built extensive fiber networks, with fiber becoming the preferred choice for new greenfield deployments and in some instances deployed in parallel to existing copper networks. And in the last few years, the pace of copper retirement has accelerated. This rapid pace of formal copper retirements, along with the deterioration of copper networks that have not been formally retired, has led to requests from both competitive LECs and public advocates for changes to the Commission's copper retirement rules to protect competition and consumers. We reaffirm that “the increasing frequency and scope of copper retirements call into question key assumptions that underpinned our existing copper retirement rules.” Indeed, today we find that the pace and impact of copper retirement necessitates changes to ensure that our rules governing copper retirement serve the public interest. Sixteen copper retirement notices have been filed with the Commission since November 2014. We thus conclude, as we tentatively concluded in the

NPRM,

that the foreseeable and increasing impact that copper retirement is having on competition and consumers warrants revisions to our network change disclosure rules to allow for greater transparency, opportunities for participation, and consumer protection. By retaining a notice-based process that promotes certainty for consumers, interconnecting carriers, and incumbent LECs, our actions advance the transition to fiber while serving our key pro-competition and pro-consumer goals.

13. We clarify at the outset that the revisions we adopt today to the network change disclosure rules are not intended to change the nature of the process from one based on notice to one based on approval. The current network change disclosure process applies to situations in which an incumbent LEC makes a change in its network facilities, such as when it replaces copper facilities with fiber. If this change in facilities does not result in a discontinuance, reduction, or impairment of service, then the carrier need not file an application under Section 214(a) seeking Commission authorization for the planned network change. Rather, it must only provide notice in compliance with the Commission's network change disclosure rules. However, some changes in network facilities can result in a discontinuance, reduction, or impairment of service for which Commission authorization is needed. For instance, in one prominent example, Verizon filed an application under Section 214(a) when it sought to replace the copper network serving Fire Island that was damaged by Superstorm Sandy with a wireless network over which it would provide its VoiceLink wireless service. We expect all carriers to consider carefully whether a proposed copper retirement will be accompanied by or be the cause of a discontinuance, reduction, or impairment of service provided over that copper such that they must file a discontinuance application pursuant to Section 63.71 of our rules. If the answer to that question is no, then the carrier need only comply with the Commission's network change disclosure process as revised herein.

(a) Copper Retirement Notice Process

(i) Expansion of Notice Requirements To Promote Competition

14.

Background.

Certain commenters express fear that incumbent LECs will use technology transitions as an opportunity to thwart competition from competitive LECs and others by erecting market barriers. Thus, competitive LECs and state commissions, as well as other commenters, largely support the concept of revising the network change disclosure rules to provide for more robust notice to competitors of planned copper retirements. On February 26, 2015, the California PUC filed a motion for acceptance of its late-filed comments because it was first able to consider the

NPRM

at its public meeting on February 5, 2015, and PUC staff was unable to provide a recommendation prior to that date. No oppositions to this motion were filed. We grant the California PUC's motion and accept its comments, which we cite herein without reference to the date filed. They believe that the existing network change disclosure rules “are not sufficient to enable competitive LECs to prepare for an ILEC's broad-scale transition to an all-IP network.” Incumbent LECs, on the other hand, argue that the Commission's network change disclosure rules are sufficient and that there is no need for the revisions proposed in the

NPRM

. They assert that the proposed revised requirements would impose onerous and unnecessary burdens on incumbent LECs. Cincinnati Bell asserts that the Commission should not require direct notice to interconnecting carriers because of the “scores of interconnection agreements with CLECs, many of whom never became active or have only limited interconnection activity” and because “[m]any CLECs have been subject to various mergers and acquisitions but have failed to maintain current contact information.” And many of the requirements proposed by competitive LEC commenters, they argue, go beyond the concept of adequate notice and would deter additional investment in fiber deployment. We note, however, that Windstream, which is both an incumbent LEC and a competitive LEC, has stated that it “believes it could feasibly implement [the proposed] requirements, and they would not cause disruption to its copper retirement processes.”

15.

Discussion.

After reviewing the record before us, we conclude that the Commission's network change disclosure rules should be updated in light of marketplace developments to address the needs of competitive carriers for more robust notice of planned copper retirements. To make our rules sufficient for this purpose, we revise them to require incumbent LECs planning copper retirements to include in their network change disclosures a description of any changes in prices, terms, or conditions that will accompany the planned changes. In addition, as explained in detail below, we establish a process in which incumbent LECs must provide direct notice to interconnecting entities at least 180 days prior to the planned implementation date, except when the facilities to be retired are no longer being used to serve customers in the affected service area. The requirements that we adopt reflect the revisions proposed in the

NPRM,

subject to certain modifications discussed further below.

16. We conclude that receipt of the additional information and the extended notice period we adopt today will allow interconnecting entities to work more closely with their customers to ensure minimal disruption to service as a result of any planned copper retirements. Contrary to some commenters' assertions, the record in this proceeding contains significant evidence that our existing rules are insufficient to ensure adequate notice to interconnecting carriers. We wish to avoid situations such as the one recounted by XO, where it received notice that one of its customers—a group of nursing homes—would be losing service the next day as a result of glitches in the copper retirement process (a result XO narrowly managed to avoid). Although some commenters claim that our rule changes will discourage copper retirements, we find that retaining a time-limited notice-based process ensures that our rules strike a sensible and fair balance between meeting the needs of interconnecting carriers and allowing incumbent LECs to manage their networks.

17. Also contrary to some commenters' assertions, we find that the revised notice requirements do not serve to conflate the Section 251(c)(5) network change disclosure process and Section 214(a) discontinuance process. Other commenters, however, are concerned that incumbent LECs are themselves “blur[ring] the distinction between mere retirement of copper facilities (while the carrier continues to offer the same service(s) using other facilities), on the one hand, and the discontinuance, reduction, or impairment of service on the other.” Consistent with the proposal in the

NPRM,

we retain a notice-based regime for copper retirement, in contrast to the approval-based process for a Section 214(a) discontinuance of service. The Rural Broadband Policy Group asserts that we should not permit automatic enrollment in or switching of services unless explicitly approved by the customer. We believe this concern is obviated by the fact that we are retaining the notice-based nature of the network change disclosure process. Customers will have an opportunity to obtain service from other providers if they determine based upon a notice of a planned copper retirement that they no longer desire to receive service through their current provider. We realize certain commenters are concerned that a planned copper retirement might amount to a discontinuance of service. As discussed above, any loss of service as a result of a copper retirement may constitute a discontinuance, reduction, or impairment of service for which a Section 214(a) application is necessary. The modifications we adopt today do not convert the network change disclosure process. Customers will have an opportunity to obtain service from other providers if they determine based upon a notice of a planned copper retirement that they no longer desire to receive service through their current provider. We realize certain commenters are concerned that a planned copper retirement might amount to a discontinuance of service. As discussed above, any loss of service as a result of a copper retirement may constitute a discontinuance, reduction, or impairment of service for which a Section 214(a) application is necessary.

18.

Scope and Form.

In the

NPRM,

we proposed requiring that incumbent LECs provide public notice of copper retirement by the means currently permitted by Section 51.329(a) of the Commission's rules, as well as requiring them to directly provide notice of copper retirement to “each information service provider and telecommunications service provider that directly interconnects with the incumbent LEC's network.” Certain commenters support the proposal contained in the

NPRM,

while other commenters seek to expand the scope further to also require notice to additional entities. For example, one group of commenters urged the Commission to extend the notice requirements to competitive LECs that purchase UNEs and special access. We decline to adopt this proposal. First, by broadening copper retirement notice to encompass “each entity” that directly interconnects with the incumbent LEC's network, we ensure notice to a broad range of entities. Second, if after a

change from copper to fiber facilities UNEs will no longer be available, that is an issue arising under Section 251(c)(3) of the Act, pertaining to unbundled access, rather than Section 251(c)(5), which applies to notice of change in facilities. With respect to special access, that is a service issue rather than a facilities issue. As such, any change in the availability may fall under the purview of our Section 214(a) authority, as discussed

infra

in Section II.B.2.

19. Based on the record before us, we conclude that we should adopt these proposed requirements, modified to require notice to “each entity” within the affected service area that directly interconnects with the incumbent LEC's network. We find that doing so constitutes “reasonable public notice” under Section 251(c)(5) of the Act because it will ensure that all entities potentially affected by a planned copper retirement, be they telephone exchange service providers, information service providers, or other types of providers that may or may not yet have been classified by the Commission, receive the information necessary to allow them to accommodate the copper retirement with minimal impact on their end user customers. We do not, however, similarly expand the pool of entities to whom incumbent LECs must provide direct notice of network changes outside of the copper retirement context. The record does not contain any evidence sufficient to justify such an expansion.

20. We are not persuaded by the arguments of incumbent LEC commenters that this requirement “would impose onerous and unnecessary administrative burdens.” AT&T argues that this requirement, in conjunction with expansion of the copper retirement notice requirement to encompass retirement of copper feeder plant, would necessitate providing direct notice to potentially hundreds of competitive LECs that do not have any facilities implicated by the planned network change. Because under existing requirements incumbent LECs must notify potentially large numbers of directly interconnected telephone exchange service providers as part of the copper retirement process, we do not find that argument supports the claim that the revisions we adopt today are unreasonable. Under the predecessor rules to those we adopt today, copper retirements were already subject to the “short term notice provisions” set forth in Section 51.333(a). Unless otherwise specified or dictated by context, citations in this Order to specific sections of the Commission's rules governing network change disclosures are to the version of those rules as they exist prior to the effective date of the rules adopted herein. Under Section 51.333(a), which applies “[i]f an incumbent LEC wishes to provide less than six months' notice of planned network changes,” the incumbent LEC must file with the Commission a certificate of service that includes a statement that, at least five business days in advance of its filing with the Commission, the incumbent LEC served a copy of its public notice upon each telephone exchange service provider that directly interconnects with the incumbent LEC's network; and the name and address of each such telephone exchange service provider upon which the notice was served. Such certificates of service reflect that incumbent LECs have been obligated to provide notice to large numbers of interconnecting carriers.

21. Incumbent LECs have not provided sufficient detail to establish that providing the direct notice described in those certificates of service was burdensome or specifically how expanding the pool of recipients as proposed in the

NPRM

would impose a new “onerous and unnecessary administrative burden” on them. Rather, they rely solely on conclusory allegations. As a result, we conclude that expanding this existing requirement to include all entities that directly interconnect with the incumbent LEC's network within the affected service area would not impose an appreciably greater burden on incumbent LECs. We also find this revision to our rules reasonable because it will ensure that all competitive LECs and other interconnecting entities that could be affected by the planned copper retirement receive information that would assist them in preparing to accommodate the planned network change. We require the method of transmission of the notice to match existing requirements for notice to interconnecting telephone exchange service providers, as the record does not indicate that this existing requirement has been insufficient. This approach provides as much flexibility as possible to incumbent LECs while ensuring that the notice will serve its function.

22. The rule that we adopt today requires notice to the Commission and omits the option to provide written public notice through industry fora, industry publications, or the carrier's publicly accessible Internet site. This is merely a technical modification of our proposal, under which some form of notification to the Commission would have been required in all prior cases and publication-based notice would have been optional and thus not required. Therefore, this change streamlines our rules and emphasizes that notice to the Commission initiates the copper retirement process. We find this change warranted to ensure that the Commission is notified promptly of all planned copper retirements and to streamline the rule. We nonetheless encourage incumbent LECs to provide notice through industry fora, industry publications, and the carrier's publicly accessible Internet site as a good practice.

23.

Content of Notice.

In the

NPRM,

we proposed requiring incumbent LECs to include in their public notices of copper retirement, and thus their notices to interconnecting carriers, the information currently required by Section 51.327(a) of our rules, as well as “a description of any changes in prices, terms, or conditions that will accompany the planned changes.” Based on the record before us, we conclude that it is appropriate to adopt these proposed requirements. We find that doing so is consistent with Section 251(c)(5)'s mandate that incumbent LECs provide “information necessary for the transmission and routing of services using that local exchange carrier's facilities or networks, as well as of any other changes that would affect the interoperability of those facilities and networks” because it will ensure that interconnecting entities, including competitive LECs, are fully informed about the impact that copper retirements will have on their businesses.

24. We are unpersuaded by incumbent LEC commenters' assertions that the proposed expanded copper retirement notice requirements would impose an undue burden on them because it is impossible to determine how a planned change can be expected to impact various interconnecting entities. Section 51.327(a) already requires that incumbent LEC network change public notices include “changes planned” and “the reasonably foreseeable impact of the planned changes.” We conclude that the proposed expanded content requirement, which is limited to a description of any changes in prices, terms, or conditions that will accompany the planned retirement, is a narrow and targeted extension of the existing requirement to provide notice of the “reasonably foreseeable impact of the planned changes” already required by Section 51.327(a)(6) of our rules. We address commenter concerns regarding our legal authority to require this information in copper retirement notices

infra

in Section II.B.1.a(vi). We

do not believe providing this additional information will present an undue burden on incumbent LECs, and any such additional burden will be outweighed by the needs for an interconnecting entity to have sufficient information to adjust its network to accommodate planned copper retirements, which could require costly and disruptive changes to the interconnecting carrier's network simply to allow it to continue serving its end user customers. Indeed, the Commission rejected this very argument when it adopted the network change disclosure rules.

25. We decline, however, to require that the descriptions of the potential impact of the planned changes be specific to each interconnecting carrier to whom an incumbent LEC must give notice, as requested by the Competitive Carriers Association. We conclude that such a requirement would impose an unreasonable burden on incumbent LECs. We also decline to require, as suggested by Windstream, that copper retirement notices include information regarding impacted circuits and wholesale alternatives. Section 51.327(a) already requires that notices of planned network changes include references to technical specifications, protocols, and standards regarding transmission, signaling, routing, and facility assignment as well as references to technical standards that would be applicable to any new technologies or equipment, or that may otherwise affect interconnection. And as discussed below, the rule we adopt today requires that incumbent LECs work in good faith with interconnecting entities to provide information necessary to assist them in accommodating planned copper retirements without disruption of service to their customers. We conclude that these requirements, included in proposed new Section 51.332, already ensure that enough information will be provided to address Windstream's concerns and ensure sufficient protection to interconnecting carriers. We further conclude that such requirements will adequately address the concerns raised by Cincinnati Bell that incumbent LECs cannot “know what type of alternative arrangements might suit any impacted carriers.”

26. We conclude that the content requirements we adopt today capture the needs of competitive providers for information that allows them to plan for and accommodate the planned network change while providing incumbent LECs the flexibility to provide that information in the form best suited to the particulars of their situation. We therefore require only that copper retirement notices include the information set forth in new Section 51.332(c). We decline to adopt a particular required format for copper retirement notices. We are not persuaded that the Commission's rules should mandate a particular format for copper retirement notices. Rather, we believe that a specified format could prove problematic. As noted by the California PUC, “a uniform format may not cover all aspects of each provider's copper retirement plans. The FCC should require that all necessary components of the incumbent LEC's planned retirement be contained in any notice, but also allow each provider to include additional information about options available to customers.”

27.

Notice Period.

In the

NPRM,

we sought comment on whether the 90-day minimum notice period for copper retirements currently required by our rules is sufficient or whether it should be extended. Verizon asserts that if an incumbent LEC gives notice more than six months in advance of a planned implementation, there is no justification for requiring it to comply with the more burdensome short-term notice rules. However, the Commission's short-term notice rules apply to planned copper retirements, and provide that “under no circumstances may an incumbent LEC provide less than 90 days' notice of such a change.” In response, commenters propose that if we replace the existing time period, we adopt either six months, one year, or an unspecified amount of time. Commenters proposed a variety of time periods for notice, ranging from the existing ninety days, to 180 days, to one year, to an unspecified amount of time as is provided for in Section 68.110(b) of the Commission's rules. Based on the record in this proceeding, we conclude that 180 days' advance notice of copper retirements is an appropriate time frame. We find that the ninety-days' notice of planned copper retirements currently provided for by the Commission's network change disclosure rules is insufficient. Most competitive LECs provide service to business customers pursuant to multi-year contracts. And competitive LECs assert that a ninety-day notice period “may not provide competitive carriers with sufficient lead time to make the upgrades or reconfigurations necessary to complete a seamless transition to IP-based service, or to make alternative arrangements.” The record reflects numerous instances in which competitors and their customers have suffered significantly due to the short notice period. Although current rules allow for the possibility for interconnecting carriers to object and attempt to extend the retirement to six months (

i.e.,

approximately 180 days), this procedure is rarely used, likely because of the short time to file and the fact that objections are deemed denied absent Commission action. Indeed, at least one competitive LEC asserts that shortcomings in the incumbent LEC's public notice precluded any meaningful opportunity to object within the permitted time period.

28. We conclude that a notice period of at least 180 days (

i.e.,

approximately six months) strikes an appropriate balance between the planning needs of interconnecting carriers and their customers and the needs of incumbent LECs to be able to move forward in a timely fashion with their business plans. The period of time that we adopt is approximately the maximum time period that had been available in response to a successful objection previously. We conclude a notice period of this length will not impose an undue burden on incumbent LECs, who must plan their deployments over extended periods of time. Indeed, at least one incumbent LEC has acknowledged that it has provided notice to customers of a planned fiber-to-the-premises overbuild deployment six months prior to deployment. Regardless, other incumbent LEC commenters contend that we should not extend the ninety-day notice period in the existing rules. And we find that any increased burden on incumbent LECs is outweighed by the need to ensure that interconnecting carriers receive sufficient notice to allow them to accommodate the transition without disruption of service to their customers, which can include enterprise and government customers whose communications needs and budgeting concerns require more than 90 days' notice. To ensure at least 180 days of notice, we require notice to interconnected entities to be provided no later than the same date on which the incumbent LEC provides notice of the retirement to the Commission. After the Commission receives notice of the retirement, it will issue a public notice of the retirement, starting the 180-day “countdown” such that the copper retirement may go forward under our rules. This use of Commission public notice to trigger the “countdown” matches the predecessor process, matches our proposal in the

NPRM,

and helps to further ensure that the public is informed about copper retirements. The

NPRM

sought comment on extending the notice period to 180 days, but it did not specifically propose this change and therefore the proposed rules

retained the pre-existing 90-day “countdown” period. The shift to a 180-day “countdown” period retains the timing mechanism in the proposed rules but reflects that a notice period to interconnecting entities of at least 180 days is necessary.

29. We are not persuaded by Verizon that our existing requirements provide more than sufficient notice. It is the incumbent LEC itself that controls the timing of the decision to make or procure a product whose design necessitates the network change. This is a business decision on the part of the incumbent LEC, and, as such, there is no reason to assume that the timing it chooses will coincide with the needs of interconnecting carriers—indeed, as stated above, the record reflects that it does not. We agree with Verizon, however, that where facilities are no longer being used to serve any customers, whether wholesale or retail, a shorter notice period is appropriate. Accordingly, we do not apply the new notice period of at least 180 days to such situations and instead adopt a notice period of at least 90 days, which is similar to the baseline under the prior rules.

30. Finally, we find that in light of the longer notice period we adopt today, we will discard the objection procedures as they apply to copper retirements. Specifically, we will modify the proposed rule as it pertains to objection procedures to delete the references to implementation dates in proposed paragraphs (g), (h), and (i) in their entirety. We do not, however, remove the objection procedures pertaining to short-term notices of non-copper retirement network changes in Section 51.333 because we are not creating a fixed six-month notice period for such planned network changes and because there is no evidence in the record that the concerns pertaining to copper retirements apply equally to other types of network changes. The extended notice period we adopt today will provide to interconnecting entities a notice period similar to the six months they previously would have been afforded if they successfully objected to the timing of a planned network change. Under the current rules, an interconnecting provider can object to the timing of a copper retirement and, if successful, delay the implementation of that retirement to six months from the date the incumbent LEC gave its original notice. This fixed period following the Commission's release of public notice will provide parties sufficient opportunity to work together to allow for any accommodations needed to maintain uninterrupted service to end users. And by fixing a single time period following the Commission's release of public notice, we provide all parties certainty and avoid the costs inherent in the objection process, which itself will be beneficial to all concerned.

31. We recognize the importance of information flow to competitors' abilities to ensure that a retirement of copper facilities does not disrupt service to their end users. We therefore include a good faith communication requirement in the modified rule we adopt today. Under the prior rules, an interconnecting provider could request “specific technical information or other assistance” to enable it to accommodate the planned network change. And in the

NPRM,

we sought comment on what additional information interconnecting providers might need in order to make an informed decision. The good faith communication requirement we adopt today will ensure that interconnecting entities still may obtain the information they need in order to accommodate the planned copper retirement without disruption of service to their customers that they would have been entitled to seek through the objection procedures that we eliminate. Specifically, we provide that an entity that directly interconnects with the incumbent LEC's network may request that the incumbent LEC provide additional information where necessary to allow the interconnecting entity to accommodate the incumbent LEC's changes with no disruption of service to the interconnecting entity's end user customers, and we require incumbent LECs to work with such requesting interconnecting entities in good faith to provide such additional information. We conclude that incorporating a good faith requirement into the rule strikes an appropriate balance between the needs of interconnecting carriers for sufficient information to allow for a seamless transition and the need to not impose overly burdensome notice requirements on incumbent LECs. Certain commenters propose more extensive content requirements for copper retirement notices than we adopt today. WorldNet also proposes adoption of “a requirement for an ILEC to work with a CLEC in good faith by responding to reasonable requests for additional information about a proposed retirement and to work collaboratively with a CLEC in effectuating desired CLEC transitions to alternate facilities.” In the Further Notice of Proposed Rulemaking (FNPRM), we seek comment on possible specific indicia of such good faith. We note that the Commission will not hesitate to take appropriate measures, including enforcement action, where incumbent LECs fail to act in good faith to provide appropriate information to interconnecting entities.

32. We conclude that the good faith communication requirement that we adopt today is consistent with the First Amendment because it compels disclosure of factually accurate information in a commercial context. Compelled commercial disclosures are not afforded the same protections as prohibitions on speech. Indeed, the Supreme Court has held that “[b]ecause the extension of First Amendment protection to commercial speech is justified principally by the value to consumers of the information such speech provides,” the commercial speaker's “constitutionally protected interest in

not

providing any particular factual information . . . is minimal.” The Court held further in that case that an advertiser's rights are reasonably protected as long as disclosure requirements are reasonably related to the State's interest in preventing deception of consumers, and that the right of a commercial speaker not to divulge accurate information regarding his services is not a fundamental right. Thus, compelled disclosure is subject to a less stringent standard of review than prohibitions on speech. The United States Court of Appeals for the DC Circuit has held that the holding in

Zauderer

can be read broadly and that government interests in addition to correcting deception can be invoked to sustain a mandate for the disclosure of purely factual information in the commercial context in the face of a First Amendment free speech challenge. We find that, in this case, the government has an interest sufficient to compel incumbent LECs to provide necessary technical information to interconnecting entities to enable those entities to accommodate planned copper retirements without disruption of service to their customers. The disclosure that we require is designed ultimately to protect retail customers. This entails the provision only of factual information. We therefore find that the good faith requirement is reasonably related to the government's interest in advancing competition, and that this interest outweighs the incumbent LECs' “minimal” interest in not providing particular factual information to interconnecting entities. We note that, even if the higher standard of

Central Hudson Gas & Electric Corp.

v.

Public Service Commission of New York

applied in this instance, the good faith communication requirement adopted as part of this Order satisfies this higher

standard of judicial scrutiny. Under

Central Hudson,

a court in a commercial speech case must determine: (1) Whether the expression is protected by the First Amendment; (2) whether the asserted government interest is substantial; and (3) whether the regulation directly advances the governmental interest asserted, and whether it is not more extensive than is necessary to serve that interest. Even assuming the expression is subject to constitutional protection, we believe that the asserted government interest in this case of protecting retail customers is, indeed, substantial. Similarly, we conclude that ensuring competition in communications is a substantial interest. Moreover, we also find that the good faith requirement does not impose a more extensive burden than necessary because it applies only to information that is

necessary

to meet the government interest in allowing interconnecting carriers to accommodate the incumbent LEC copper retirements with no disruption of service. Thus, even were the more stringent standard of

Central Hudson

to apply in this instance, we believe that the good faith communication requirement detailed above satisfies such a standard.

33.

Revisions to Other Rule Sections.

As proposed in the

NPRM,

we revise Section 51.331 by deleting paragraph (c), which provides that competing service providers may object to planned copper retirements by using the procedures set forth in Section 51.333(c), and we revise Section 51.333 to remove those provisions and phrases applicable to copper retirement. We find that consolidation of all notice requirements and rights of competing providers pertaining to copper retirements in one comprehensive rule provides clarity to industry and customers alike when seeking to inform themselves of their respective rights and obligations.

34.

Other Proposals.

We decline to adopt Ad Hoc's proposal that, for a network change to qualify as a “mere” copper retirement, in contrast to a service discontinuance, “a carrier must present the same standardized interface to the end user as it did when it used copper.” Ad Hoc argues that if a network change requires the use of “new or upgraded terminating equipment to convert traffic on the new facility into a format compatible with the installed base of network interface devices, customer premises equipment (CPE), or inside wire,” the carrier should “install that terminating equipment on its own side of the network demarcation point . . . and absorb the costs of doing so as part of its network modernization costs.” We are not persuaded that the requirement Ad Hoc proposes is necessary. Section 68.110(b) of the Commission's rules, which speaks to the effect of “changes in facilities, equipment, operations, or procedures” on customers' terminal equipment, requires only that a carrier afford customers notice of such changes if such changes can be reasonably expected to render the equipment incompatible with the carrier's facilities or require modification or alteration of the equipment, or otherwise materially affect use or performance, for the purpose of allowing the customer “an opportunity to maintain uninterrupted service.” While Section 68.110(b) requires mere notice, Ad Hoc's proposal goes significantly further by requiring significant action on the part of the carrier, and the record is insufficient to support this significant and potentially burdensome departure from our current rules. And, as noted by AT&T in opposing this proposal, there is no reason to believe that all changes to customer CPE will be “costly” and that customers will not desire any freedom to select their own upgraded CPE.

35. We also decline to adopt the proposal of certain commenters that incumbent LECs should provide competitive providers with an annual forecast of copper retirements. We understand that competitive LECs would find this type of information useful in planning for the effects copper retirements might have on their respective networks and customer contracts. However, incumbent LECs maintain that this type of information can constitute some of their most competitively sensitive information, and that such an advance disclosure requirement may risk putting them at a competitive disadvantage. We note that information contained in a forecast can change over time as circumstances change. Thus, the inclusion of a particular wire center in a copper retirement forecast does not guarantee that such a change in facilities will in fact occur or that it will occur within that timeframe. Thus, based on the record before us, we are skeptical of the value of such a requirement.

36. Finally, we decline to adopt a requirement that incumbent LECs establish and maintain a publicly available and searchable database of all their copper plant, whether it has been or will be retired, whether it will be removed, or a database of where copper retirements have occurred. Incumbent LECs oppose such a requirement because it “would divert vital resources away from the deployment of new fiber” and because “CLECs seeking to purchase UNEs . . . already have access to preorder systems that identify loop availability.” It simply is not clear based on the record available that creation of any such databases would be feasible or cost-effective. We are persuaded by commenters that such a requirement could impose an expensive and potentially duplicative, and therefore unnecessary, burden.

(ii) Notice to Retail Customers

37.

Background.

In the

NPRM,

we proposed revisions to the Commission's network change disclosure rules “to provide additional notice of planned copper retirements to affected retail customers, along with particular consumer protection measures, and to provide a formal process for public comment on such plans.” Specifically, we proposed requiring incumbent LECs to provide notice of planned copper retirements to retail customers who are directly impacted by the planned change, and we did not limit this proposal to consumers. We further proposed allowing incumbent LECs to provide such notice to retail customers by either written or electronic means, and we sought comment on possible procedures to ensure that such notice is both received and accessible by customers. We also proposed specific content requirements to ensure that retail customers receive sufficient information “to understand the practical consequences of copper retirement” and sought comment on whether the proposed requirements are adequate to protect consumer interests. With respect to the timing of the proposed notice to retail customers, we proposed imposing the same requirement that currently applies to notice to interconnecting carriers and giving such retail customers thirty days from the Commission's release of its Public Notice in which to comment on a proposed copper retirement. And we sought comment on our statutory authority to impose these proposed requirements. To address allegations of inappropriate actions taken by incumbent LECs with respect to consumers, we also sought comment on requiring incumbent LECs to “supply a neutral statement of the various choices that the LEC makes available to retail customers affected by the planned network change,” as well as requiring incumbent LECs to undertake consumer education efforts in connection with planned copper retirements.

38.

Discussion.

After reviewing the record before us, we conclude that modification of our network change disclosure rules to require direct notice to retail customers of planned copper retirements is warranted and is

consistent with the public interest, including our core value of consumer protection, and with Section 251(c)(5)'s requirement of reasonable public notice of network changes. To be clear, as explained further below, this notice is required only where the retail customer is within the service area of the retired copper and only where the retirement will result in the involuntary retirement of copper loops to the customer's premises,

i.e.,

in the circumstances in which retail customers are likely to be affected. Copper retirements of this nature often affect consumers and other end users, whether for better or for worse, and these customers need to understand how they will be affected. A variety of commenters support our proposal to require direct notice to retail customers of planned copper retirements. And consumers need to understand the ways in which copper retirement will

not

affect them; absent such notice, consumers may not understand that they may retain their existing service (if applicable in the particular circumstance). The record reflects numerous instances in which notice of copper retirement has been lacking, leading to consumer confusion. Public interest commenters have brought to our attention proceedings in various states, including Maryland, California, New York, New Jersey, Illinois, and the District of Columbia, alleging customer complaints about being migrated from copper networks to other types of facilities, including allegations that such migrations have resulted in a move from regulated to unregulated services, without adequate customer notice and consent. Based on this information, we are unconvinced by certain commenters' assertion that there is no record evidence to support the Commission's expressed concerns regarding customer confusion about their options. And such consumer complaints and confusion persist. Even commenters critical of aspects of our proposed customer notification requirements otherwise agree that consumers deserve to receive information regarding the effect of copper retirements on their service. And we believe that requiring incumbent LECs to provide this information to their customers will allow for a smoother transition by minimizing the potential for consumer complaints arising out of a lack of understanding regarding the planned network change.

39. We conclude the benefits of providing customers with the information needed to make informed decisions regarding the services they receive from incumbent LECs outweigh any additional burdens these new notice requirements may impose on the incumbent LECs. Indeed, incumbent LEC commenters note the importance of working with their customers in connection with copper-to-fiber transitions. CenturyLink has even made sure in at least one instance to send postcards to its own customers, as well as to advise competitive LECs when their end user customers would be affected by a planned network change. And under the rules we adopt today, which we have modified from the rules proposed in the

NPRM

in order to minimize the burden they impose on incumbent LECs, incumbent LECs will be required to provide only one neutral statement to consumers and will not be subject to any other additional obligations.

40. We disagree with commenters who assert that rules mandating such notice are unnecessary. Although some incumbent LECs assert that they already provide such notice, it is not clear that many or all provide such notice, and as noted above the record reflects numerous instances in which notice has been unreliable absent a regulatory mandate. We thus find unpersuasive Cincinnati Bell's argument that because a carrier that will discontinue a service after a copper retirement will have to file a Section 214 application, to also requirement a copper retirement notice “would be redundant and confusing to consumers.” The simple, clear notice that we require is necessary because the record reflects that consumers are not receiving sufficient notice in all cases. Some incumbent LECs assert that they already must contact customers who need to have new terminal equipment installed as a result of a network change so that they may obtain access to the customers' premises. But this merely shows that incumbent LECs have incentives to communicate to a degree sufficient to obtain access to a consumer's premises; this does not demonstrate any incentive to educate consumers about issues such as whether existing services will remain available.

41. We also find unpersuasive the assertion that a notice requirement is unnecessary because the Commission's current rules already provide for notice to the public of planned network changes via Sections 51.325 and 68.110(b). First, we note that Section 68.110(b)'s notice requirements are not always triggered by a planned copper retirement. More importantly, however, we find that the general public notice now provided by incumbent LECs under Section 51.325, which typically takes the form of a general notice posted on the carrier's Web site, is not sufficient to give actual notice to those customers most likely to be affected by planned copper retirements. Until recently, consumers generally would not be directly affected in serious ways by most network changes because copper retirements in favor of fiber-only facilities were largely voluntary. In that environment, reasonable public notice could be effectuated indirectly by posting on the carrier's Web site where those most affected (

e.g.,

competitive LECs) would know to look. Given the accelerated pace of copper retirement, however, we find that consumers are directly affected in ways they had not been at the time the Commission adopted the copper retirement rules in the

Triennial Review Order,

and therefore consumers need direct notice for these important network changes that may directly affect them. We simply do not find it credible to believe that the public regularly checks the network change notification portion of our Web site or of their service provider's Web site.

42. We disagree with commenters who assert that our proposed notice requirement would impose an unnecessary burden because most customers are ultimately happy with an upgrade from copper to fiber facilities. This line of argument reflects a fundamental misunderstanding of the purpose of the notice requirement, which in no way reflects a view that fiber services are inferior to copper— indeed, the Commission has embraced the transition to fiber and other high-capacity transmission media. First, even the many customers who are ultimately happy with a copper-to-fiber transition are likely to benefit from understanding the change that will be occurring. Moreover, there remains a segment of the population, however comparatively small, that is resistant to changes in technology or for whom the new technology proves to be inferior to the old, and that will benefit from information that might ease the transition for them or that will allow them to seek out service from another provider. In the case of copper, such individuals may prefer a line-powered transmission medium, they may be comfortable with a long-standing technology that “just works,” or they may not understand the benefits of alternative technologies. As noted by the Pennsylvania PUC, “copper retirements under the existing rule apparently has the potential to reduce wholesale, incumbent, or competitor access, thereby reducing retail customer choice.” And as noted by the City of New York, “absent clear, direct notice to

decision-makers for any discontinuance or network change, consumers will not be empowered to either plan or respond.” And one commenter noted the possibility for confusion regarding whether certain advanced services offer the same functionality consumers have come to depend on from their legacy services. And public interest commenters have expressed concern regarding the perceived state trend toward deregulation. While we do not establish an approval process for copper retirement that would disrupt technological advancement, neither can we ignore the benefits afforded to consumers from receiving information regarding planned network changes that may affect the service to which they subscribe. Moreover, we fear that without a clear, neutral message explaining what copper retirement does and does not mean, some consumers will easily fall prey to marketing that relies on confusion about the ability to keep existing services. As with the DTV transition, we must ensure that the most vulnerable populations of consumers do not fall through the cracks. We believe that the minimally intrusive requirements we adopt today, which represent an education-based approach, strikes the correct balance between minimizing the impact on incumbent LECs' fiber deployment plans and ensuring that consumers are informed about how they will be impacted.

43.

Recipients.

In the

NPRM,

we proposed requiring direct notice to “all retail customers affected by the planned network change,” and we defined “affected customers” as “anyone who will need new or modified CPE or who will be negatively impacted by the planned network change.” Based on a review of the record in this proceeding, we conclude that we should adopt a modified version of this proposal. Thus, under the updated rules we adopt today, incumbent LECs will be required to provide direct notice of planned copper retirements to all of their retail customers within the affected service area(s), but only where the copper to the customer's premises is to be retired (

e.g.,

where an incumbent LEC replaces copper-to-the-premises with fiber-to-the-premises regardless of the customer's preference). We believe limiting the notice requirement to retirements involving involuntary replacement of copper to the customer's premises limits notice to circumstances in which customers are most likely to be affected, thereby avoiding confusion and minimizing the costs of compliance. We recognize that in some cases copper is removed in connection with a voluntary election by the customer to receive fiber-to-the-premises or other non-copper-to-the-premises service; in such cases, of course, the regulatory notice requirement is not triggered. Our notice requirement is focused on circumstances in which an incumbent LEC chooses to stop offering service to the customer's premises via the copper network, irrespective of the customer's preference.

44. We also believe modifying the proposed class of recipients in this way will make it easier for incumbent LECs to comply with their notice obligations by (1) limiting the circumstances under which they must provide notice to retail customers, and (2) removing the need for the incumbent LEC to make an independent determination regarding whether particular customers will require new or modified CPE or whether particular customers will be negatively impacted by the planned network change. This also obviates the need for the New York PSC's proposed requirement that incumbent LECs define “impacted customers” in their certifications. Notice to customers will not be required in those instances where operational copper remains in place. While under the rule that we adopt notice of a given copper retirement may be provided to more customers than would have received notice under the proposed rule, the notice requirement will be triggered less often because it will not be required if copper continues to reach the premises. Further, we conclude that this approach strikes the right balance in providing clarity, ensuring no customers are inadvertently excluded from the pool of recipients, and ensuring that notice is provided where it is most needed. Incumbent LEC commenters expressed concern regarding what they perceive as ambiguity about the proposed definition of “affected customers.” Another incumbent LEC feels that “ `affected customers' should be limited to those who must take some action in response to a network change, or whose service is affected due to a change in price, service feature or function, or equipment.” We emphasize that, consistent with our proposal set forth in the

NPRM,

the rule we adopt herein extends copper retirement notice requirements not just to consumers, but also to non-residential end users such as businesses and anchor institutions. Certain commenters assert that our proposed notice requirements should be extended to include utilities and critical infrastructure industries. This includes incumbent LEC enterprise customers, such as utilities and critical infrastructure industries within the affected service area.

45.

Content.

In the

NPRM,

we proposed requiring that copper retirement notices to retail customers “provide sufficient information to enable the retail customer to make an informed decision as to whether to continue subscribing to the service to be affected by the planned network changes,” including the information required by Section 51.327(a), as well as statements notifying customers that they can still purchase existing services and that they have a right to comment, and advising them regarding timing and the Commission's process for commenting on planned network changes. Certain commenters assert that our proposed notice requirements should be extended to include utilities and critical infrastructure industries.

46. After review of the record in this proceeding, we conclude that it is warranted and appropriate to adopt the content requirements proposed in the

NPRM,

with several modifications described below. The record supports a finding that a significant number of consumers are confused regarding the effect of copper retirements on their service, and would thus benefit from notices providing them the information needed in order to properly evaluate the continued ability of their current service to meet their needs. We note that the requirements we adopt today provide as much flexibility as possible subject to necessary limits to help ensure that consumers will receive and understand the copper retirement notices they receive. Various commenters support our proposals regarding the content of copper retirement notices to retail customers. The notice requirement will have the added benefit of increasing consumer confidence in technology transitions. We further find that these content requirements should not be overly burdensome. Indeed, they are similar to existing Commission rules governing notice in the context of the discontinuance process and the use of customer proprietary network information (CPNI). We find the CPNI notice process a useful comparison point because it also involves educating and informing consumers and because those rules prescribe detailed steps to ensure that consumers will receive and recognize email based notice, which we also permit here.

47. The rule we adopt today is modified from the proposal in the

NPRM

in four ways. First, we adopt the additional requirement that the mandatory statements in the notice must be made in a clear and conspicuous manner. As stated above,

the record reflects that a number of consumers are confused when copper retirements occur, so clear and conspicuous provision of information will help to remedy that issue. Our rules already require “clear and conspicuous” notice in a number of contexts. To provide additional guidance, we clarify that a statement is “clear and conspicuous” if it is disclosed in such size, color, contrast, and/or location that it is readily noticeable, readable, and understandable. In addition, the statement may not contradict or be inconsistent with any other information with which it is presented; if a statement materially modifies, explains or clarifies other information with which it is presented, then the statement must be presented in proximity to the information it modifies, explains or clarifies, in a manner that is readily noticeable, readable, and understandable, and not obscured in any manner; and hyperlinks included as part of the message must be clearly labeled or described. We adopt this detailed definition of “clear and conspicuous” to provide guidance to help ensure that customers will understand the required notice and to provide certainty to industry about our requirements. To streamline the filing and reduce the burden on incumbent LECs, we decline to require that the notice include: (1) Information required by Section 51.327(a)(5), because that primarily requires provision of technical specifications that are unlikely to be of use to most retail customers; (2) a statement regarding the customer's right to comment on the planned network change, because, as discussed below, we decline to include in the updated rule we adopt today a provision regarding the opportunity to comment on planned network changes; and (3) a statement that “[t]his notice of planned network change will become effective a certain number of days after the Federal Communications Commission (FCC) releases a public notice of the planned change on its Web site” because this statement is likely to be unnecessarily confusing and because 47 CFR 51.327(a)(3), which we incorporate as to customer copper retirement notices, already requires disclosure of the implementation date of the planned changes.

48.

Neutral Statement.

In the

NPRM,

we proposed prohibiting incumbent LECs from including in copper retirement notices to retail customers “or any other communication to a customer related to copper retirement any statement attempting to encourage a customer to purchase a service other than the service to which the customer currently subscribes.” In addition, we proposed requiring incumbent LECs to include “a neutral statement of the various choices that the LEC makes available to retail customers affected by the planned network change.”

49. After reviewing the record before us, we conclude that we should require incumbent LECs to include in copper retirement notices to retail customers a neutral statement of the various service options that they make available to retail customers affected by the planned copper retirement. We also conclude that the notice that we require must be free from any statement attempting to encourage a customer to purchase a service other than the service to which the customer currently subscribes, but that this prohibition will apply

only

to copper retirement notices provided pursuant to the Commission's network change disclosure rules and not to any other communication. We intend that this notice serve not only this consumer protection goal, but also provide affected customers with the opportunity to learn about the facility change and give them an opportunity to seek more information. To that end, we require that providers maintain a toll-free number that customers may call to raise any questions about the planned retirement, and a URL for a related Web page with relevant information (

e.g.,

a “frequently asked questions” page). Both the toll-free number and the address for the Web page should be included in the notice to the customer, along with contact information for the Commission (including a link to the Commission's consumer complaint portal) and the relevant state PUC. This requirement will ensure that consumers have direct access to the provider to better understand what to expect regarding the process of copper retirement and any possible impact on their service. Moreover, while the requirement we adopt today is for a single notice to the affected customers, we emphasize that this single notice is a floor, not a ceiling. We strongly encourage carriers to follow up with affected consumers to ensure that they have received the notification and understand the implications to facilitate a smooth transition for these customers.

50. This neutral statement requirement and limited prohibition will better enable retail consumers to make informed choices about their services and will give them the necessary tools to determine what services to purchase without swaying them towards new or different offerings. We believe that this strikes the right balance between allowing incumbent LECs to advise their customers regarding the availability of advanced services and preventing potentially aggressive marketing tactics that might lead to consumer confusion. To be clear, nothing in the requirements that we adopt prohibits marketing new or different services in communications other than the notice that we require.

51. The record reflects extensive support for these requirements, and that they will carry clear value for consumers. As ADT observes, “[t]he Commission should not permit ILECs to use the technology transition to create new marketing opportunities for themselves.” Contrary to some assertions, we are not inserting ourselves in carriers' marketing strategies—indeed, carriers remain free to engage in unlimited marketing with the exception of the single neutral notice that we require.

52. Certain commenters assert that there is no record evidence to support the Commission's expressed concerns regarding the pressure certain carriers have allegedly brought to bear on customers to switch services. However, the record belies this assertion. For example, NASUCA pointed to a news story in Montgomery County, Maryland describing a consumer's experience with pressure to move from copper not just to fiber but to a package of digital services offered over the fiber network. And public interest commenters cite to various incumbent LEC actions that raise the concern that incumbent LECs' motivation to sell bundles may discourage the kind of neutral communication that we require. According to the Director of Montgomery County's Office of Consumer Protection, that office received complaints from consumers alleging that the carrier in question was engaged in “deceptive marketing practices” as it transitioned customers to the fiber network. That article also points to nationwide complaints filed with the Federal Trade Commission. The assertions about lack of evidence in the record also ignore the sources of support cited in the

NPRM.

53. We are not persuaded by the argument that prohibiting incumbent LECs from discussing the availability of advanced services prevents carriers from educating consumers regarding the benefits of fiber. The only thing our new rule prevents is the inclusion of such discussions in copper retirement notices issued pursuant to our rules, which could lead to confusion regarding the continued availability of the type of service to which the consumer currently subscribes. Incumbent LECs are free to provide information regarding advanced

services offered over fiber in any of their marketing materials, as those materials are not the required copper retirement notice. While incumbent LECs and their representative organizations assert that the majority of consumers have embraced the benefits of fiber, these assertions ignore the existence of those consumers who have not yet chosen to purchase services beyond basic voice, many of whom are among the more vulnerable segments of the population. And it is those consumers who are most in need of the notice requirement that we adopt. Our “one neutral notice” requirement ensures that consumers will receive key information on the services available to them without significantly inhibiting incumbent LEC marketing efforts, therefore striking the best balance between informing consumers and facilitating the technology transitions.

54. Aside from the neutral statement requirement discussed above and the related requirement to make available a toll-free number and contact information, we decline to adopt any further content requirements. Certain commenters want the notices to retail customers to include detailed information regarding all possible changes that could result from a planned copper retirement, including “the impact on continuity of service in an electrical power outage” and the availability of substitute services. And one commenter proposes that notices to retail customers also “inform customers of their avenues to appeal to their Public Utilities Commission, Office of Consumer's Counsel, or the Federal Communications Commission if the change would bring about negative consequences for consumers.” We decline to adopt these proposed expanded content requirements. In an effort to minimize our regulation, we additionally decline to adopt the “separate postage” rule proposed by ADT, which would prohibit notices to retail customers from being included “in the same envelope” as any material marketing advanced services. The modified rule we adopt today will require incumbent LECs to identify “any changes to the service(s) and the functionality and features thereof,” which would include continuity of power. And as discussed below, the updated rule will require that incumbent LECs certify their compliance with Section 68.110(b)'s requirement that carriers notify customers when a planned change in facilities will affect the compatibility of CPE. With respect to the proposal that we require incumbent LECs to identify the availability of substitute services, we proposed in the

NPRM

that incumbent LECs be required to include in their copper retirement notice to retail customers “a neutral statement of the various choices that the LEC makes available to retail customers affected by the planned network change.” As discussed above, we incorporate this requirement into the updated rule. At this time, we do not believe it is necessary to require more than this in the context of the notice to customers, where the copper retirement does not rise to the level of a discontinuance, reduction, or impairment of service for which a carrier would need to seek Commission authorization.

55.

Constitutionality.

We are not persuaded by arguments that the prohibition on marketing new services and the requirement of a neutral statement of service offerings amount to violations of their constitutional right to free expression. We conclude that the notice requirement that we adopt is consistent with the First Amendment because it merely contains a narrow, targeted time, place, and manner restriction and compels disclosure of factually accurate information in a commercial context.

56. The “one neutral notice” requirement that we adopt today largely addresses incumbents' arguments in opposition to the proposed prohibition on upselling contained in the

NPRM,

which was far more restrictive. In fact, the upselling prohibition that we adopt today applies only to the notice that we require. Incumbent LECs are free to inform their customers of advanced services offered over fiber facilities through as many other communications as they wish. We believe deployment of fiber facilities is beneficial in many respects, and we do not seek to deter it. However, we must ensure that such deployments do not happen in a manner that negatively impacts vulnerable populations. The “one neutral notice” requirement that we adopt strikes this balance while imposing the most limited restriction possible.

57. It is well-established that government may impose time, place, and manner restrictions on protected speech “provided the restrictions `are justified without reference to the content of the regulated speech, that they are narrowly tailored to serve a substantial government interest, and that they leave open ample alternative channels for communication of the information.' ” The Commission's upselling prohibition and neutral statement requirement are reasonable time, place, and manner restrictions given the low burden that these requirements place on providers and the substantial government interest they serve. Incumbent LECs will still be free to seek to inform customers about new or upgraded services in separate communications using whatever means they so choose, even during a network upgrade. Instead, the requirement of a neutral statement of product offerings and the prohibition on attempts at upselling in a copper retirement notice are intended to promote the substantial government interest of protecting retail customers, especially vulnerable ones such as the elderly, from aggressive and confusing upselling by incumbent LECs at the same time the carriers are informing those customers of changes in facilities. We are not seeking to control what incumbent LECs say to their customers or to impose our own view of appropriate upselling; rather, we seek to ensure that retail customers are fairly informed of the effect of a planned copper retirement without the possible added confusion of contemporaneous communications by their providers to attempt to sell them other, possibly more expensive services. The objective is to better enable retail consumers to make informed choices about their services. We conclude that this significant government interest would be achieved less effectively absent implementation of the prohibition and the neutral statement requirement.

58. The customer notice that we require is consistent with the First Amendment because it merely requires the provision of true factual information in a commercial context and therefore is consistent with

Zauderer.

We find that, in this case, the government has an interest sufficient to compel incumbent LECs to include a neutral statement in their copper retirement notices that, among other things, includes the various choices available to retail customers affected by the planned network change and provide sources of additional information related to that planned network change, and to inform interconnecting entities about technical information concerning the changes. The notice that we require is designed to protect retail customers, in particular vulnerable populations such as elderly consumers, and to ensure that they are made aware of the full range of product offerings available to them following a planned copper retirement. The notice entails the provision only of factual information. We therefore find that the notice is reasonably related to the government's interest in safeguarding retail consumers, and that this interest outweighs the incumbent LECs' “minimal” interest in not providing

particular factual information to their customers. We note that, even if the higher standard of

Central Hudson

applied in this instance, the notice requirement adopted as part of this Order satisfies this higher standard of judicial scrutiny. Even assuming the expression is subject to constitutional protection, we believe that the asserted government interest in this case of protecting retail customers—including but not limited to elderly consumers and other vulnerable populations—and ensuring that they are made aware of the full range of product offerings following a copper retirement is, indeed, substantial. Moreover, the requirement of a single neutral statement of service offerings has been tailored narrowly to directly advance these stated interests by providing retail customers with a list of the full range of product offerings made available by their providers. We also find that this notice requirement does not impose a more extensive burden on providers than is necessary to serve the asserted governmental interests. Thus, even were the more stringent standard of

Central Hudson

to apply in this instance, we believe that the notice requirement satisfies such a standard.

59.

Form.

In the

NPRM,

we proposed allowing incumbent LECs to use written or electronic notice such as postal mail or email to provide notice to retail customers of a planned copper retirement. Based on a review of the record in this proceeding, we conclude that we should adopt this proposed requirement, which a variety of commenters support. Although certain commenters urge the Commission to permit more flexibility, we conclude that the requirement we adopt today strikes the right balance between ensuring receipt of notice and avoiding unnecessary burdens. In particular, we find that notice in formats other than email or postal mail would be too easily ignored by consumers. The requirement we adopt today should be sufficient to ensure that retail customers receive notice, without imposing unnecessary additional burdens on incumbent LECs.

60. However, we are cognizant of concerns that permitting customers to directly reply to emails containing copper retirement notices could impose a heavy administrative burden on them. Because we retain the notice-based process for copper retirement network change disclosures, we find that there is little reason to require incumbent LECs to allow customers to reply directly to these email notices. On the other hand, we find that the benefits to consumers of the other requirements we proposed in the

NPRM

outweigh any additional administrative burdens on incumbent LECs. These requirements are consistent with the requirements contained in our CPNI rules, and only one commenter opposed to our proposed notice requirements touched on this specific issue. Dissemination of the notice shall be made available and accessible to persons with disabilities. We note that incumbent LECs are required to make their disseminated information and Web site accessible.

61.

Notice Period for Retail Customers.

In the

NPRM,

we proposed providing retail customers at least ninety-days' notice of planned copper retirements. We conclude that this notice period is appropriate for residential retail customers, to whom earlier notice may be confusing and potentially forgotten over a long period of time. Based on our review of the record in this proceeding, however, we conclude that non-residential retail customers, which include businesses and anchor institutions, require more than ninety-days' notice. As discussed above, we have concluded that it is appropriate to extend the notice period for interconnecting carriers to at least 180 days. We now conclude that non-residential retail customers should receive the same amount of notice as interconnecting carriers. Enterprise customer commenters and the competitive LECs that provide them service assert that they require more than ninety days' notice of planned copper retirements to allow for planning to accommodate the network changes. Certain commenters believe 180 days is an appropriate period for notice to retail customers. One commenter asserts, however, that utilities need notice of a planned copper retirement at least one year in advance. On the other hand, CenturyLink currently gives its DSL consumer customers thirty days' notice of “network upgrades.” At least one commenter supports providing retail customers the same amount of notice as provided to interconnecting carriers. As stated above, we find this longer time period warranted as to non-residential customers but potentially confusing and unwarranted for residential customers. This should allow non-residential retail customers sufficient time to evaluate the impact of the planned network change on the service they would continue to receive and whether they need to seek out alternatives. Given that we are extending the notice period for interconnecting carriers, there is no significant added cost to matching that notice period for non-residential end users compared to adopting a shorter notice period solely for such end users. We note that where the facilities to be retired are no longer in use, we conclude that incumbent LECs need not provide notice of the planned copper retirement to their retail customers because there are no retail customers to whom to provide notice.

62.

Other Consumer Education.

In the

NPRM,

we sought comment on whether we should require incumbent LECs to undertake consumer education initiatives in connection with planned copper retirements. We conclude that the rules we adopt today requiring detailed notices to retail customers, together with the requirement to make available a toll-free number and contact information for additional resources, lessens the immediate need for further educational efforts directed toward consumers at this time. That said, we remain concerned about whether consumers will have the information they need on copper retirement specifically and technology transitions more generally. For instance, the Michigan PSC states that “education during the copper transition is critical to alleviate misunderstandings and confusion for consumers and supports requiring initiatives similar to the digital television (DTV) transition to allow the copper transition to move along more smoothly.” While we set a foundation today by implementing a more targeted solution, we suspect that more will be necessary as the transition progresses. To be clear, we do not foreclose the possibility of adopting additional consumer education initiatives in response to the

NPRM

and we otherwise may revisit the issue particularly if there is evidence of consumer confusion and concerns following copper retirements.

63. In addition, we emphasize and support the role of state commissions and Tribal governments to support consumer education around copper retirement. States traditionally have played a critical role in consumer protection, and we strongly encourage carriers engaging in copper retirement that affects consumers directly to partner with state public service commissions, Tribal entities, and other state and local entities to ensure consumers understand and are prepared for the transition. We note that the record reflects the benefit of cooperation between state commissions and carriers during the copper retirement process—including by ensuring minimal disruption to consumers. For instance, the Massachusetts Department of Telecommunications and Cable reports on its “recent experience with the transition of the Town of Lynnfield, Massachusetts to an all fiber network”

and explains that “the MDTC worked collaboratively with Verizon Massachusetts on prior customer notification, and that as a result the Lynnfield transition was successfully completed with minimal disruption.” We applaud such efforts and encourage other providers to coordinate cooperatively with their state commissions.

64.

Other Proposals.

We decline to adopt the proposed rural exemption advocated by TCA, an organization representing a large number of rural LECs. TCA asserts that many of its members are small, member-owned or locally-owned businesses located in the very communities they serve. As a result, TCA asserts that the requirements proposed in the

NPRM

are “onerous and unnecessary.” We conclude the modifications we have adopted in response to the record received sufficiently address these concerns. And while the rules necessarily impose some burden on incumbent LECs, we do not find that burden to be greater for rural LECs or that rural consumers are less in need of information regarding planned copper retirements.

65. We also decline to adopt the proposal of the Communications Workers of America that we should impose different notice requirements for network upgrades (

i.e.,

replacing the copper facilities with fiber facilities), network downgrades (

e.g.,

“a removal to replace the copper with [facilities for] an inferior voice-only service (such as Verizon's Voice Link service)”), and “the complete abandonment of facilities.” We do not believe such differentiation is necessary. The “downgrade” CWA refers to is framed in terms of replacing one service with a different, inferior service. Such a situation is more appropriately addressed in the context of a Section 214(a) discontinuance, reduction, or impairment of service, rather than a change in facilities. With respect to “the complete abandonment of facilities,” if this change in facilities results in a discontinuance, reduction, or impairment of service, then it also would fall within the purview of our rules governing such situations and the incumbent LEC would be obligated to comply with the copper retirement notice obligations and file a discontinuance application.

66. Finally, we decline to adopt the City of New York's proposal that we require proof of notice acknowledged by individual customers before allowing changes. We are concerned that such a requirement would unfairly penalize incumbent LECs for the failure of their customers to act. End users typically would not have an incentive to provide such an acknowledgement.

(iii) Ability To Comment

67. After consideration of the record and other avenues for input, we find that avenues to communicate with the Commission are sufficient and that formalizing a right to comment is not needed. We therefore decline to adopt the proposal to revise the network change disclosure rules to provide “the public, including retail customers and industry participants, with the opportunity to comment on planned network changes.” We are persuaded that a formalized comment process could be confusing to consumers because there is no approval process associated with copper retirements. Certain commenters support the Commission's proposal to provide retail customers with the formal right to comment on planned copper retirements, although at least one commenter urged the Commission to at least make clear how it will use comments submitted by the public. However, various commenters on both sides of this issue note that providing the public the right to submit comments formally (1) does not provide additional advantage beyond use of the existing email address, and (2) will confuse consumers and lead to dissatisfaction, because we did not propose to convert the network change disclosure process to one requiring Commission approval. As stated above, we reject requests that the Commission convert the current notice-based network change disclosure process to a process in which an incumbent LEC must obtain Commission approval before implementing a proposed copper retirement. The public, including consumers and competitive carriers, have multiple means with which to communicate with us regarding copper retirements. Since we adopted the

NPRM,

an amendment to Section 51.329 of the Commission's rules requiring that carriers file network change disclosures in the Commission's Electronic Comment Filing System and permitting responsive filings to be filed via ECFS has become effective. Thus, network change disclosures are now docketed proceedings open to public comment. Consumers and others are able to submit complaints to the Consumer and Governmental Affairs Bureau. The public also may continue to comment on planned network change disclosures via the email address established specifically for that purpose. We find that no further action is needed at this time.

(iv) Notice to States, Tribal Governments, and the Department of Defense

68. In the

NPRM,

the Commission proposed requiring incumbent LECs to send notices of proposed copper retirements to the public utility commission (PUC) and to the governor of the state in which the network change is proposed and to the Secretary of Defense, similar to the current requirement for such notice in connection with Section 214 discontinuance applications. We sought comment on whether to also require notice of planned network changes that do not involve copper retirement and whether to require notice to other governmental entities, such as the Federal Aviation Administration, Tribal governments, or municipalities. Public interest advocates, including various state PUCs, support the Commission's proposal to require notice to state authorities and the Department of Defense. We noted that the Commission is “not the only governmental authority with important responsibilities with respect to technology transitions” and “[i]n particular, States serve a vital function in safeguarding the values of the Network Compact.”

69. After reviewing the record before us, we conclude that “reasonable public notice” in the context of copper retirements includes providing notice of the planned copper retirements directly to state authorities (the governor and the state PUC), the Department of Defense, and federally recognized Tribal Nations where the copper retirement will occur within their Tribal lands. Throughout this document, “Tribal Nations” and “Tribal governments” include any federally recognized Indian tribe's reservation, pueblo of colony, including former reservations in Oklahoma; Alaska Native regions established pursuant to the Alaska Native Claims Settlement Act (85 Stat. 688); Indian allotments; and Hawaiian Home Lands—areas held in trust for Native Hawaiians by the State of Hawaii, pursuant to the Hawaiian Homes Commission Act, 1920, Act July 9, 1921, 42 Stat. 108,

et seq.,

as amended. The copper retirement notices containing the information required by the rule we adopt today and existing state notification obligations under Section 214 will provide state authorities with significant information concerning technology transitions. We therefore decline to impose any of the additional state and local notification requirements proposed by Public Knowledge at this time. We further conclude that this notice should occur contemporaneously

with notice to interconnecting entities. Specifically, this notice must be provided no later than the same time as the incumbent LEC notifies the Commission (

i.e.,

no later than the same time that it submits the notice that will trigger the Commission to issue a public notice that establishes a period of at least 180 days before retirement) unless there are no customers, in which case the notice must be provided at least 90 days before retirement. We find this time period warranted to ensure adequate notice to these entities so that they can discharge their responsibilities, and we find the 90-day exception warranted because governance issues are likely to be fewer where there are no customers. In light of the accelerated pace of copper retirements and the allegations in the record of this and other proceedings, we conclude that the states should be fully informed of copper retirements occurring within their respective borders so that they can plan for necessary consumer outreach and education. State authorities are an important source of consumer outreach and education, and they need the information that can allow them to field the calls that will come when consumers receive copper retirement notices. As noted by the Pennsylvania PUC, “copper retirements under the existing rule apparently ha[ve] the potential to reduce wholesale, incumbent, or competitor access, thereby reducing retail customer choice. This has real consequences on the ground in the states.” Because of the impact of copper retirements at the State level, we believe it is important to address “concerns about technological change, competitive access, and universal service . . . with the principle of cooperative federalism.” The concern is no less on Tribal lands, where state commissions may not have jurisdiction to regulate carriers or address consumer complaints, and we find no basis in the record for distinguishing between States and Tribal governments. And given the increased cybersecurity risks posed by IP-based networks, the Department of Defense should be kept informed of copper retirements. The requirement we adopt today is consistent with the requirements associated with Section 214 of the Act and Section 63.71 of the Commission's rules. Indeed, when the Commission adopted the requirement that carriers seeking to discontinue services notify state PUCs and the Department of Defense, it noted: “State commissions with notice will be better able to bring to our attention the effects of discontinuances upon customers who may be unable themselves to inform us that they lack substitute service, upon interexchange access providers, and upon competing carriers who may not receive notice of anti-competitive discontinuances. Accordingly, 47 CFR 63.71 will include the requirement that the applicant must submit a copy of its application to the public utility commission as well as to the Governor of the State and the Secretary of Defense. . . .” Carriers previously had been required to provide this same notice under Sections 1.764 and 63.90(d) of the Commission's rules. We decline to adopt this same notice requirement for other network change notifications at this time given a lack of sufficient support in the record or clear need on the part of the governmental or Tribal Nations.

70. No commenters in this proceeding have brought to our attention any concrete difficulties that incumbent LECs would experience due to compliance with this proposed requirement. And various states already require carriers to file notices of network change with their public utility commissions. Moreover, various state commission commenters support this requirement, undercutting incumbent LEC arguments that states will be flooded with notices they do not necessarily want. Commenters opposed to the proposed rules argue that requiring additional notice to affected states and the Department of Defense could “introduce new and unwarranted complexity into the process” since such agencies will already receive notice to the extent they are customers who will receive notice in the regular course, pursuant to the

NPRM'

s other proposed notice requirements. And, they argue, as the pace of copper retirement accelerates, these agencies likely will be deluged with notices for which the incumbent LECs argue there is no corresponding benefit. We are not persuaded by these arguments. Various states already require carriers to file notices of network change with their public utility commissions. And we are not convinced that a government authority's receipt of notice of a copper retirement should depend on whether the authority is a customer of the carrier because: (1) Not every copper retirement in a state will affect the state as a customer; and (2) the notice of copper retirement to the state as a customer will likely go to a different administrative office than a notice to the State as a governmental entity. Nor are we convinced that carrier participation in forums such as the National Security Telecommunications Advisory Committee obviates the Department of Defense's need for copper retirement notifications. Rather, as explained above, these notifications will ensure that government authorities have timely and consistent access to information they need to perform their consumer protection and public safety responsibilities throughout the technology transitions.

(v) Certificate of Service

71. In the

NPRM,

we proposed requiring that incumbent LECs file along with their public notice a certification containing specified information, much of which was previously required by Sections 51.329(a)(2) and 51.333(a) of our rules.

72. After reviewing the record before us, we conclude that we should adopt the proposal, as modified below. In particular, we adopt a rule that requires an incumbent LEC to file with the Commission at least ninety (90) days before retirement is permissible a certificate of service, signed by an officer of the company and complying with Section 1.16 of the Commission's rules, that includes the following information:

• A statement that identifies the proposed changes;

• A statement that notice has been given in compliance with paragraph (b)(1) of the Section;

• A statement that the incumbent LEC timely served a copy of its notice filed pursuant to paragraph (b)(1) of the Section upon each entity within the affected service area that directly interconnects with the incumbent LEC's network;

• The name and address of each entity referred to in paragraph (d)(3) of the Section upon which written notice was served;

• A statement that the incumbent LEC timely notified and submitted a copy of its public notice to the public utility commission and to the Governor of the State in which the network change is proposed, to any federally recognized Tribal Nations with authority over the Tribal lands in which the network change is proposed, and to the Secretary of Defense in compliance with paragraph (b)(4) of the Section;

• If customer notice is required by paragraph (b)(3) of the Section, a statement that the incumbent LEC timely served the customer notice required by paragraph (b)(3) of the Section upon all retail customers to whom notice is required;

• If a customer notice is required by paragraph (b)(3) of the Section, a copy of the written notice to be provided to retail customers;

• A statement that the incumbent LEC has complied with the notification requirements of Section 68.110(b) or that the notification requirements of Section 68.110(b) do not apply;

• A statement that the incumbent LEC has complied with the good faith communication requirements of paragraph (g) of the Section and that it will continue to do so until implementation of the planned copper retirement is complete; and

• The docket number and NCD number assigned by the Commission to the incumbent LEC's notice.

73. Requiring this information is reasonable and necessary to ensure compliance with our rules, will assist with enforcement if any inaccuracies were subsequently found, and is consistent with the current requirement applicable to short-term notices in Section 51.333(a). Numerous commenters support this requirement. Incumbent LEC commenters, however, believe such a requirement is unwarranted. As previously noted, under the existing rules, notices of copper retirements must comply with the short-term notice provisions. We require identification of the docket number and NCD number to facilitate our processing of the certification. Monitoring compliance with the rules we adopt today would be difficult without incumbent LECs confirming for us that they have complied. And the consumer complaints brought to our attention by public interest commenters as well as the concerns raised by various competitive providers highlight the need for the Commission to be able to monitor compliance with the requirements we adopt today. The at least ninety-day time period we adopt is appropriate because it is as prompt as possible after all possible notification duties have been completed. We decline to require multiple staggered certifications to minimize the regulatory burden on incumbent LECs. The Enforcement Bureau will investigate potential carrier violations of the rules we adopt today governing the copper retirement process and will pursue enforcement action when necessary.

74. We conclude that Section 68.110(b)'s notice requirements and the customer notice requirements we adopt today are complementary. Section 68.110(b) requires that telecommunications providers give customers “adequate notice” of changes in network facilities if such changes will render CPE incompatible. Certain commenters argue that the protections afforded by Section 68.110(b)'s notice requirements, in conjunction with Section 51.325's public notice requirements for network changes, afford sufficient protections. Others argue for cross-referencing Section 68.110(b)'s notice requirements in any revised rules we adopt. We note, however, that Section 68.110(b)'s notice requirements will not always be triggered when public notice of a planned copper retirement is required under revised Section 51.325. We therefore also conclude that requiring incumbent LECs to certify their compliance with Section 68.110(b)'s notice requirements, when applicable, will ensure that incumbent LECs have evaluated the effect of any planned copper retirements on customers' terminal equipment. We are not persuaded by Cincinnati Bell that requiring incumbent LECs to certify that they have directly notified all interconnecting carriers “may be an impossible burden to meet.” As discussed above, under the predecessor rules to those we adopt today, copper retirements have been subject to the “short term notice provisions” set forth in Section 51.333(a); and under Section 51.333(a), which applies “if an incumbent LEC wishes to provide less than six months' notice of planned network changes,” the incumbent LEC already must certify that they have provided the public notice required by Section 51.325(a) directly to interconnecting telephone exchange service providers. As previously noted, incumbent LECs in fact include such certificates of service when filing their copper retirement notices with the Commission. The accelerated pace of broadband deployment and technology transitions warrant the Commission's reevaluation of the role of network change disclosures in protecting core values. Moreover, we conclude that the certification requirement embodied in Section 51.333(a), which we carry over to new Section 51.332(d), provides important protections. It ensures that all affected parties receive the appropriate notification.

(vi) Legal Authority

75.

Notice Requirements.

We conclude that we have authority pursuant to Sections 201(b) and 251(c)(5) of the Act to adopt the proposed revisions to the network change disclosure rules regarding the types of information that must be contained in copper retirement notices. As noted above, Section 251(c)(5) of the Act requires “reasonable public notice of changes in the information necessary for the transmission and routing of services using that local exchange carrier's facilities or networks, as well as of any other changes that would affect the interoperability of those facilities and networks.” We conclude that this language in the Act affords the Commission broad discretion in determining the information an incumbent LEC should be required to provide to interconnecting carriers. However, in implementing Section 251(c)(5) and adopting the network change disclosure rules, the Commission in the

Second Local Competition Order

defined the phrase “information necessary for transmission and routing” as “any information in the incumbent LEC's possession that affects interconnectors' performance or ability to provide services.” Noting that network change disclosures promote “open and vigorous competition contemplated by the 1996 Act, the Commission declined to restrict the types of information that must be disclosed and noted that “[t]imely disclosure of changes reduces the possibility that incumbent LECs could make network changes in a manner that inhibits competition.” The Commission thus noted that the information “must include

but not be limited to

references to technical specifications.” We thus reject arguments that the enhanced content requirements proposed in the

NPRM

go beyond the type of information authorized by Section 251(c)(5). We conclude that providing interconnecting entities with information regarding the effect of a planned copper retirement on rates, terms, or conditions will allow those entities to better plan their business. We further conclude that, contrary to AT&T's assertions, this is consistent with the Commission's determination in the

Second Local Competition Order

that the information to be provided in network change disclosures is not limited to information that will affect existing interconnection arrangements but rather should include “information concerning network changes that potentially could affect anticipated interconnection.” We also conclude that the additional information proposed in the

NPRM

is necessary to ensure that the incumbent LECs' practices are just and reasonable under Section 201(b) of the Act. Competitive providers need information regarding changes to the rates, terms, and conditions that will result from a planned copper retirement in order to engage in appropriate business planning.

76. The updated network change disclosure rules we adopt today are crucial to protecting the core values of the Act, specifically the promotion of competition and protection of consumers. We disagree with

commenters that argue that requiring incumbent LECs to provide notice to retail customers goes beyond the authority of Section 251(c)(5) to require that incumbent LECs provide “reasonable public notice.” We conclude that the phrase “reasonable public notice” requires the Commission to determine what notice must be provided and to whom it should be provided in order to serve the public interest. We agree with public interest commenters that our actions here ensure that consumers have accurate and timely notice of network changes that could impact the functionality and interoperability of their devices or third-party services, the Commission is giving clarity to what is considered “`reasonable public notice” of changes that affect the transmission, routing, and interoperability of services on the network. We further conclude that “reasonable” notice to non-expert members of the public cannot strictly be limited to a bare description of the changes; instead, it should encompass the kind of clarifying information that we require here.

77. Finally, we reject arguments that Section 706 of the 1996 Act counsels against the actions we take today. Section 706(a) is a grant of authority to “utilize, in a manner consistent with the public interest, convenience, and necessity . . . measures that promote competition in the local telecommunications market, or other regulating methods that remove barriers to infrastructure investment.” Additionally, if the Commission determines that “advanced telecommunications capability” is not being deployed in a “reasonable and timely fashion,” Section 706(b) requires that the Commission “take immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market.” Our actions are consistent with these provisions. Contrary to Cincinnati Bell's assertion, it simply is not true that we are “forc[ing] [incumbent LECs] to preserve their copper networks.” In fact, we retain a notice-based process that provides a clear path to copper retirement. By promoting an environment in which all parties are more able to accept transitions away from copper, creating a more predictable retirement notification process, and retaining a notice-based process that does not erect additional regulatory barriers, the Commission acts to facilitate the deployment of advanced telecommunications services and remove potential barriers to infrastructure investment in a manner consistent with the public interest. We also promote competition by ensuring that interconnecting entities have the information that they need to continue to serve customers, and thus retain income needed for further investment, when copper facilities with which they interconnect are retired.

78.

Provision to Governmental and Tribal Entities.

We also conclude that Section 251(c)(5)'s requirement that incumbent LECs provide “reasonable public notice of changes in the information necessary for the transmission and routing of services using that local exchange carrier's facilities or networks” supports our decision to require notice to state authorities, Tribal governments, and the Department of Defense. State authorities and the Department of Defense already receive notice of service discontinuances, and this information provision will facilitate a consolidated understanding of technology transitions. These key public agencies are important recipients of such notice as guardians of the public interest. And given their extensive duties and limited resources, it would be unreasonable to expect them to have to constantly monitor the Web sites of numerous incumbent LECs as well as the Commission. We conclude that cooperating and coordinating with these key governmental authorities to ensure that consumers are protected and competition is preserved is also supported by Section 201(b)'s broad grant of authority to prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions of the Act. We are persuaded that the minimal additional notice requirements that we adopt here will not reduce incentives for incumbents to continue to deploy fiber, and the consumer protection and public safety benefits outweigh the additional burden on incumbent LECs. We realize that Section 63.71(a) of the Commission's rules does not require notice to Tribes in connection with a discontinuance application, and that it could be incongruous to require greater notice for copper retirement than for discontinuances. However, as noted above, we believe it is important to act cooperatively with state and Tribal authorities to address “concerns about technological change, competitive access, and universal service,” and the concern is no less on Tribal lands, where state commissions may not have jurisdiction. We therefore include in the FNPRM a request for comment on revising Section 63.71(a) to include such a requirement.

b. Definition of “Cooper Retirement”

79. Due to the current frequency and scope of copper network retirement, it is critical that industry participants and stakeholders clearly understand when our copper retirement notice process is triggered so that the momentum of prompt, responsible transitions is not abated. Therefore, it is necessary to clarify when a “copper retirement” occurs. We endeavor to catalyze further fiber deployment and find that eliminating this uncertainty removes one potential source of industry resistance or hesitation to retiring copper. Further, we find that providing additional clarity is critical for properly informing the public of network changes in accordance with Section 251(c)(5) of the Act and also for maintaining the Commission's core values. Our actions build on the

NPRM,

which requested comment on proposed revisions to the “retirement” definition, with particular focus on: (1) The types of copper facilities to be included within the concept of “retirement”, and (2) the actions (or lack of action) constituting “retirement.”

80. For the reasons set forth below, we adopt the expanded definition proposed in the

NPRM

and therefore define copper retirement to mean “removal or disabling of copper loops, subloops, or the feeder portion of such loops or subloops, or the replacement of such loops with fiber-to-the-home loops or fiber-to-the-curb loops.” We also define copper retirement to include

de facto

retirement,

i.e.,

failure to maintain copper loops, subloops, or the feeder portion of such loops or subloops that is the functional equivalent of removal or disabling. By providing additional clarity in our rules, we will minimize ongoing disputes and carrier uncertainty as to what is required as technology transitions occur in the marketplace.

81. Section 251(c)(5) of the Act imposes on incumbent LECs “[t]he duty to provide reasonable public notice of changes in the information necessary for the transmission and routing of services using that local exchange carrier's facilities or networks, as well as of any other changes that would affect the interoperability of those facilities and networks.” Although our rules require this statutorily mandated notice in the event of “retirement” of copper facilities, we have not specified what constitutes “retirement,” and we have not revisited the issue of when copper retirement triggers a network change notification requirement in over a decade. Given the increasing pace and

scope of retirements of copper facilities, we find the definition that we adopt necessary to ensure fulfillment of the goals of Section 251(c)(5).

(i) Copper Facilities To Be Included

82. The current network change disclosure rules do not include the feeder portion of loops within the relevant provisions, but they do include “retirement of copper loops or copper subloops, and the replacement of such loops with fiber-to-the-home loops or fiber-to-the-curb loops.” In the

NPRM,

the Commission sought comment on expanding “retirement” to include the feeder portion of the loop and also on whether other copper facilities should also be included. Prior to the

NPRM,

various parties requested a rulemaking to adopt rules encompassing the feeder portion of the loop, noting that if the feeder portion is unavailable for unbundled access, “the practical difficulty of obtaining access to the remaining portion of the loop forecloses competitive access to the customer.” After considering the record received, we find that modifying our rule is appropriate in light of experience with our initial implementing rules and the current marketplace. The Commission received many comments regarding the expansion of copper facilities included within the retirement definition. Several commenters support including the feeder portion, noting the importance of that portion to gaining access to retail customers. Other commenters take no position on the matter. Incumbent LECs are generally opposed to the Commission's proposed revisions to the scope of copper facilities encompassed within the rules. While incumbent LECs refrained from offering specific comments regarding the feeder loop addition, their overall position is that there is “little need for new rules in this area” and that the proposed modifications do not provide “any identifiable benefit to consumers or competition.”

83. We agree with the Pennsylvania Public Utility Commission that if the feeder portion is unavailable to competitive LECs, the practical difficulty of accessing the remaining portion of the loop for retail purposes is insurmountable. In many cases, replacement of copper feeder can have the same harmful effects as removal or replacement of the home run loops and sub loops, which are explicitly covered under the current rules. Therefore, we disagree with the incumbent LECs' argument regarding the supposed lack of benefits to consumers and competition. Incumbent LECs should not be permitted to avoid the network change notification requirements simply because they are replacing one portion of the loop instead of another equally critical portion. We also agree with XO Communications that specifying in our rules that retirement of copper feeder is a “retirement” will avoid confusion in the marketplace among both incumbent and competitive carriers. We therefore adopt our proposal that the feeder portion of the loop should be one of the copper facilities captured within the concept of retirement.

(ii) Defining “Retirement”, “Removal” and “Disabling”

84. The existing network change notification rules do not define what actions constitute “retirement” and thus what actions trigger the notification duty under Section 251(c)(5). To address this lack of a definition, we proposed defining the term “copper retirement” as “the removal or disabling of” covered copper facilities,

i.e.,

“copper loops, subloops, or the feeder portion of such loops or subloops.” For reasons discussed below, we conclude that it is appropriate to adopt a definition that defines retirement as the “removal or disabling” of copper facilities. We further define “disabling” to mean rendering the copper facilities inoperable (through acts of commission or omission). We limit the definition of “removal” to physical removal.

85. We find that the phrase “removing or disabling” is appropriate because it captures the typical activities by which incumbent LECs have transitioned away from copper networks. Notably, no commenters argued against the use of the phrase “removal or disabling.” Moreover, it is straightforward enough to indicate that providers should understand the type of activity that implicates the notification process.

86. We conclude that “disabling” should be further defined to include rendering the copper facilities inoperable. We also agree with the California PUC that “disabling” should only refer to long term or permanent periods of time and that instances where facilities are temporarily inoperable due to a catastrophe or for repair should not constitute “disabling” under the new rule. We do not intend for the retirement definition to encompass the downtime associated with scheduled upgrades and repairs. However, we caution that a sufficiently long disabling of facilities (or the functional equivalent thereof) with no end in sight, even if ostensibly temporary, may constitute retirement for which a carrier must undergo our network change notification process. Because each circumstance will require careful analysis of the particular facts at issue—including but not limited to the length of time in which the facilities have been unavailable, the announced plans of the incumbent LEC with respect to the facilities, and the extent of unavailability—we decline to adopt any bright line time limits and instead clarify that we will resolve each issue on a case-by-case basis.

87. We also clarify that the term “disabling” does not, however, mean only affirmative acts by incumbent LECs. As discussed below, acts of omission, such as the failure to repair or maintain copper facilities, can also render those facilities inoperable. A sufficient and long-term level of neglect can therefore constitute retirement.

88. As for “removal,” we conclude it should be defined as the physical removal of copper. Cincinnati Bell suggests that the Commission consider creating two categories for retirement—one for physical removal and one for non-physical removal. It argued there are several reasons that incumbent LECs should have an option to retire copper in place without physically removing it, such as: The provision of structural support for fiber optic cables and the provision of line power (from the copper) to other equipment in the field. We agree with Cincinnati Bell that copper that remains physically deployed but no longer performs its vestigial telecommunications function may nonetheless retain utility, but we find it necessary for such facilities to go through the copper retirement notification process so that the public is notified that the facilities no longer function. We conclude, however, there is no need for a non-physical definition of removal because if copper remains physically present but is no longer capable of providing telecommunications services (

i.e.,

it is inoperable), it has been “disabled” and is retired within the meaning of our rules. Therefore, contrary to Public Knowledge's suggestion, it is unnecessary to have multiple categories of “removal” in the new rule. As discussed below, we define retirement to include

de facto

retirement.

(iii)

De Facto

Retirement

89. The

NPRM

outlines numerous allegations that in some cases incumbent LECs have allowed copper networks to deteriorate to the extent that the networks are no longer reliable. In these circumstances, under our current rules, incumbent LECs have not been required to comply with the Commission's existing copper retirement procedures. The

NPRM

proposed revising our rules to require

an incumbent LEC to undergo the network change notification process for a

de facto

retirement, defined as the failure to maintain copper that is the functional equivalent of removal or disabling.

90. We find that the practice of deliberately allowing copper networks to deteriorate is harmful to competition, negatively impacting end users, and that

de facto

retirements should be covered in the copper retirement requirements. We therefore add to our definition of retirement any “failure to maintain copper loops, subloops, or the feeder portion of such loops or subloops that is the functional equivalent of removal or disabling.” We adopt this change to ensure incumbent LECs are aware that intentional neglect of copper facilities triggers their notification responsibilities, and to make such practices less likely to occur. We find that while States, localities, and Tribal Nations play a critical monitoring and enforcement role for

de facto

retirement, the Commission also has an important enforcement role to play, particularly in situations where local entities no longer have the authority to act. We encourage consumers and others to file a complaint on our Web site if their service is poor due to copper facilities that are not being maintained adequately. To be clear, the Commission will not hesitate to take appropriate measures where a provider de facto retires copper facilities without first complying with our the copper retirement requirements we adopt today, including enforcement action. We anticipate that the threat of enforcement action will serve as a deterrent to

de facto

copper retirement, but if not, the Commission reserves the right to consider more specific remedies in cases where carriers allow copper facilities to deteriorate to the point that is the functional equivalent of removal or disabling of the copper facilities (such as, depending on the particular facts and the legal authorities triggered, repairing the copper facilities or making available replacement facilities).

91. We agree with competitive LECs, state PUCs, and consumer advocates that the copper retirement definition should be expanded to include

de facto

retirements resulting from a provider's intentional neglect. In response to the

NPRM,

CWA suggests eleven factors for the Commission to consider when identifying a

de facto

retirement during a complaint process. We recognize that a wide range of information may be relevant to our evaluation, but while we gain experience with this issue we prefer to adopt a case-by-case approach rather than constrain the sources of information that we will consider. Contrary to AT&T's suggestion that “there is no such thing as a de facto retirement,” the record suggests that this is a significant issue. Several filings in the record detail a number of specific examples of negligence in Maryland, the District of Columbia, California, Illinois, and New York. Xchange Telecom expressly disputes Verizon's assertion that

de facto

retirement is a myth. And the Utilities Telecom Council points out the consequences of

de facto

retirements. We do not, however, adopt WorldNet's proposed broader definition of

de facto

retirement that would encompass inside wiring owned or controlled by the incumbent LEC. The record does not support adoption of such a broad approach, which would go beyond the scope of our copper retirement rules. Instead, we find that the scope of facilities to which the

de facto

retirement concept applies should be no broader than the underlying scope of facilities covered by our copper retirement rules.

92. We remind carriers that where they neglect copper facilities in a manner that constitutes

de facto

retirement, any resulting loss of service may constitute a discontinuance, reduction, or impairment of service for which a Section 214(a) application is necessary. The copper retirement network change notification process and the discontinuance approval process remain fundamentally distinct because the former concerns changes in facilities and merely requires notice, while the latter concerns changes in services and requires Commission approval. We therefore disagree with assertions that the revised definition for copper retirement “begins to look like the service discontinuance process.” However, in those instances where a

de facto

copper retirement also results in discontinuance, we expect carriers in such a situation to file both a notice and an application. By emphasizing Section 214(a), we do not mean to suggest that it is our only source of authority to act with respect to carriers that fail to maintain copper facilities adequately.

(iv) Scope of New Rules

93.

Flexibility to address individual customer service concerns.

In recognizing the concept of “

de facto”

copper retirement and requiring notice of certain retirements to individual customers, it is not our intent to limit a carrier's flexibility to respond to an individual customer's service quality concerns by migrating a customer from its copper facilities in areas where a carrier has already deployed fiber-to-the-premises. Accordingly, the advance notice requirements will not apply in situations in which a carrier migrates an individual customer from its copper to its fiber network to resolve service issues raised to the carrier by the customer (

e.g.,

complaints by the customer of a frequent “crackling” sound on the copper voice line or frequent outages in wet conditions), provided that the retirement does not result in a change in the nature of the services being provided to the affected customers. We contrast this customer-specific network migration (which will not trigger advance notice requirements or serve as

prima facie

evidence of de facto copper retirement) with migrations in which (i) the carrier requires customers in a given area to move from its copper to its fiber network as part of a planned network migration, in which case the notice process described above should be followed, or (ii) the carrier allows its copper network serving a broader geographical area (

e.g.,

an entire neighborhood) to deteriorate in a manner that is the “functional equivalent of removal or disabling it” without first following the notice-based copper retirement process. In addition, we caution that this clarification is not a loophole and if we see evidence of abuse, we will reevaluate the issue and take action if appropriate.

94. The clarification we provide above provides carriers with sufficient flexibility to manage service calls by moving customers from a copper to a fiber network. We therefore do not believe it is necessary or appropriate to adopt the “safe harbors” from the copper retirement notice requirements we adopt today requested by Verizon—one “in which an incumbent LEC will not be considered to have engaged in

de facto

copper retirement in areas where it has deployed a fiber network and service is available to customers over fiber facilities,” and the other “in which an incumbent LEC that meets a statewide Network Trouble Reports Per Hundred Lines standard will not be found to have engaged in

de facto

retirement of its copper facilities.” Fiber to the Home Council seeks an even broader exception, asserting that there should not be a finding of

de facto

retirement “once a carrier announces its intention to deploy fiber to residential customer premises in a specific area . . . since the carrier has an incentive to install fiber promptly and any dispute about

de facto

retirements would only impose costs without any material benefit.” We are not persuaded by this argument in light of recent news stories of incumbent LEC failures to follow through with announced intentions to

deploy fiber. In such instances, if the incumbent LEC follows the procedures set forth in the rules we adopt today, it would not subject itself to claims of

de facto

retirement. Read literally, these safe harbors could permit immediate retirement regardless of the circumstances,

e.g.,

there would be no need to notify customers even in the event of a planned retirement (as opposed to in response to an individual service complaint), and a carrier could allow its network serving many customers over a given area to deteriorate to the point of

de facto

retirement without first following the notice-based copper retirement process. In particular, we decline to adopt the first suggested safe harbor as written because it is so broad that it would eliminate any duty to educate consumers and inform carriers about transitions to fiber, undercutting a key goal of the copper retirement rules that we adopt. We also decline to adopt Verizon's second suggested safe harbor because we find it to paint with too broad a brush. While we do not suggest that this is the intent of Verizon's proposed safe harbor, meeting a statewide average troubles per line metric set by a state would allow a carrier to mask large concentrations of bad copper lines by averaging its relatively few troubles per line numbers for its fiber lines with its relatively higher troubles per line numbers for its copper lines, again undercutting the purposes of our actions today.

95. The modest clarification addresses the underlying concern that carriers will be unable to transition customers to fiber when service issues arise, while still achieving the Commission's pro-consumer goals. We understand TelePacific's concerns regarding involuntary transitions from copper to fiber, and the rules that we adopt strongly promote transparency regarding such transitions. However, we also recognize the need for carriers, when faced with exigent circumstances, to manage their networks and ensure that their customers do not have their service disrupted while their provider goes through the copper retirement network change disclosure process. Nor do we intend to subject carriers to liability for

de facto

retirement in situations where the issue is not widespread but instead the movement of a customer from a copper to a fiber network is the most effective and efficient means of addressing the customer's service concerns. Limiting the exception in the manner that we adopt strikes an appropriate balance between the needs of the incumbent LECs and the needs of competitive LECs and retail customers.

96.

States, Localities, and Tribes.

We recognized in the

NPRM

that States, localities, and Tribal Nations play a vital role in overseeing carriers' service quality and network maintenance. Nevertheless, in light of the trend in which many states' legislatures have elected to limit the scope of their PUCs' traditional authority over telecommunications services we requested comments on whether these local institutions remain able to perform key oversight functions. Many commenters indicate a strong belief that local institutions are fully capable of administering the requisite oversight—including that of copper network maintenance. Several states emphasize that they still have unique insights into their jurisdictions and require a free hand to operate. We agree that local authorities have an important and unique role to play. And contrary to Verizon's claims, our actions do not encroach on traditional state jurisdiction regarding ongoing maintenance obligations. As stated in the

NPRM,

we emphasize that we do not seek to revisit or alter the Commission's decision in the

Triennial Review Order

to preserve state authority with respect to requirements for copper retirement. Furthermore, we agree that in addition to complaints directed to the Commission, complaints from retail and wholesale customers submitted to state regulatory agencies provide critical insight as to whether an incumbent LEC has failed to adequately maintain its copper networks.

97.

Other Issues.

We decline to adopt CWA's suggestion that we distinguish disabling copper for service upgrades versus service downgrades. Our copper retirement rules do not contain such a distinction and we decline to adopt one because the Commission and the public have an equal need to be informed about all copper retirements, regardless of the purpose. We also decline at this time to adopt Public Knowledge's proposal that we establish a process for situations where a network is damaged after a natural disaster and a carrier decides to permanently replace that network with a new technology because such a clarification is unnecessary given existing requirements. The Act and our rules establish clear requirements for emergency and temporary discontinuances, and the November 2014 declaratory ruling that we reaffirm today provides significant guidance regarding when an application is required when functionality is lost. As the Commission noted when it granted Verizon's request for a waiver of Section 63.63's requirements following Superstorm Sandy: “[T]he information required by the rule is critical to the Commission's ability to ensure that customers of communications providers are minimally affected by discontinuance, reduction, or impairment of service due to conditions beyond a provider's control.” Further, the discontinuance and network change notification requirements that we propose in the FNPRM and adopt today are responsive to this concern because they help to ensure that carriers will notify us and seek our approval in appropriate circumstances and meet the needs of end users, so we do not find it necessary to establish a separate process at this time.

c. Sale of Copper Facilities That Would Otherwise Be Retired

98. We continue to “believe that sale of copper facilities could be a win-win proposition that permits incumbent LECs to manage their networks as they see fit while ensuring that copper remains available as a vehicle for competition.” We are pleased that incumbent LECs such as AT&T and Cincinnati Bell have expressed willingness to consider selling copper facilities that they intend to retire. Although we recognize that there may be difficulties involved, we encourage other incumbent LECs to consider selling copper facilities that they intend to retire.

99. While the potential benefits of sales of to-be-retired copper facilities are clear, we are not persuaded based on the record before us that we should mandate the sale of copper that an incumbent LEC intends to retire and/or establish for ourselves a supervisory role in the sale process. First, we agree with a number of commenters that Commission oversight of sales could be intrusive, costly, potentially a barrier to technology transitions, and would tax limited Commission resources. Second, the record has not revealed sufficient demand by competitive LECs or others for retired copper to warrant addressing the challenging legal and policy issues that likely would be raised. Third, as noted above, there is reason to expect that there will be willing incumbent LEC sellers in at least some markets without the need for regulatory action. Finally, we note that some state regulators are already active in this area, which mitigates at least somewhat the need for further Commission action.

100. We reject the argument that Commission intervention is necessary because incumbent LECs will refuse to sell facilities that they intend to retire to thwart competition or exercise market

power in determining the price and terms of sale. There is no evidence on the record before us that incumbent LECs have refused to sell facilities that they intend to retire. AT&T claims in its reply comments that there “is no evidence that market-based solutions will harm competition or consumers, and thus no basis for Commission regulation.” Several commenters assert that there is nothing prohibiting any prospective purchaser from inquiring about the sale of copper facilities that have been or are scheduled to be retired, and that such sales will occur to the extent that these facilities offer value to prospective purchasers. Further, our action today to ensure reasonably comparable wholesale access to next-generation services pending completion of the special access proceeding mitigates the concern that incumbent LEC refusal to sell would foreclose competition on next generation technology in the near term. Given the lack of existing evidence that incumbent LECs have refused to sell to-be-retired copper facilities, the potential disruption that could be caused by Commission oversight, and the lack of clear proof of demand in the record, we do not think it necessary to impose any such oversight measures at this time. However, we note that if parties bring to our attention evidence of actual anticompetitive behavior or market failures in connection with the sale of copper, we may revisit this issue in the future. Finally, we are not convinced that we must act because “carriers were fully reimbursed for their investments” in copper facilities—even if true, this does not show that purchasers will be able to extract additional value.

2. Updating and Clarifying Commission Section 214 Discontinuances Policy for the Technology Transitions

101. We further facilitate technology transitions by addressing the service discontinuance requirements set forth in Section 214(a) of the Act. Section 214(a) mandates that the Commission must ensure that the public is not adversely affected when carriers discontinue, reduce, or impair services on which communities rely. Today, we act to ensure that transitions in the technologies used to provide service do not undercut the availability of competitively-provided services that benefit communities and enterprise customers of all sizes that serve those communities. Our actions encourage technology transitions that could otherwise be delayed if enterprise customers lose the option to make comparable purchases at comparable rates to those which are presently available, including through supply from competitive carriers. First, we clarify that consistent with our longstanding precedent, a carrier must seek our approval if its elimination of a wholesale service results in the discontinuance, reduction, or impairment of service to a community. This clarification will minimize further disputes and carrier uncertainty as to what Section 214(a) requires as technology transitions continue in the marketplace, thereby facilitating the ability of carriers and consumers to successfully navigate this transition. Second, we require

on an interim basis

incumbent LECs that discontinue a TDM-based service to provide competitive carriers reasonably comparable wholesale access on reasonably comparable rates, terms, and conditions during the pendency of the special access proceeding. Competition provided by competitive carriers that often rely on wholesale inputs offers the benefits of additional choice to an enormous number of small- and medium-sized businesses, schools, government entities, healthcare facilities, libraries, and other enterprise customers. We therefore take these actions to protect consumers, preserve the extent of existing competition, and facilitate technology transitions. These actions will benefit the public by ensuring that as technology transitions proceed, end users do not lose service and continue to have choices for communications services. We are not today protecting competitive carriers; rather, we act to preserve their contributions to the market, which can include lower prices, higher output, and increased innovation and quality.

(a) Scope of Section 214(a) Discontinuance Authority and Wholesale Services

102.

Overview and Background.

In this section, we provide guidance and clarification concerning the circumstances in which the statutory obligations of Section 214(a) of the Act apply to a carrier's discontinuance of a service used as a wholesale input by one or more other carriers. Consistent with Section 214(a) of the Act and our precedent, we clarify that a carrier must obtain Commission approval before discontinuing, reducing, or impairing a service used as a wholesale input when the carrier's actions will discontinue, reduce, or impair service to end users, including a carrier-customer's retail end users. The Commission has previously equated “community, or part of a community” with the using public. We also clarify that a carrier may discontinue a service used as a wholesale input so long as it either (a) obtains Commission approval via the Section 214 process, or (b) determines that there will be no discontinuance, reduction, or impairment of service to end users, including carrier-customers' end users. As we explain in detail below, under the statute and our precedent it is not enough for a carrier that intends to discontinue a service to look only at its own end user customers. Instead, the carrier must follow the process established by statute and precedent for obtaining approval if its action will discontinue, reduce, or impair service to a community, or part of a community—including service provided to the community by the discontinuing carrier's carrier-customer. Thus, we explain that in order to comply with its obligations, a carrier discontinuing service—whether that carrier is an incumbent or a competitive carrier—must carefully determine whether its actions will, in fact, discontinue, reduce, or impair service to end users.

103. We provide clarity and certainty for carriers seeking to transition technologies while continuing to protect the public in the manner mandated by Congress. We find that this clarification is necessary to fortify the Commission's ability to fulfill its critical statutory role in overseeing service discontinuances under Section 214 of the Act, which requires carriers to obtain a certificate from the Commission “that neither the present nor future public convenience and necessity will be adversely affected” by the carrier's plan to discontinue service to a community or part of a community. Section 214(a) and our implementing rules were designed to protect retail customers from the adverse impacts associated with discontinuances of service, and they ensure that service to communities will not be discontinued without advance notice to affected customers, opportunity to comment, and Commission authorization. Section 214(a) and our implementing rules ensure that the Commission has the information needed to determine whether the present or future public convenience and necessity will be adversely affected by the carrier's action. Our rules are designed to ensure that customers are fully informed of any proposed change that will reduce or end service, ensure appropriate oversight by the Commission of such changes, and provide an orderly transition of service, as appropriate. As the Commission has stated in a prior enforcement action related to the Section 214 discontinuance process, “[u]nless the

Commission has the ability to determine whether a discontinuance of service is in the public interest, it cannot protect customers from having essential services cut off without adequate warning, or ensure that these customers have other viable alternatives.”

104. Our actions will help to ensure that before service that benefits a community is discontinued, reduced, or impaired, the Commission is able to conduct a careful evaluation of whether that action is consistent with the public interest. Competitive LECs are concerned that they will lose the ability to access the last-mile facilities necessary to serve their customers if incumbent LECs discontinue TDM-based services when transitioning from TDM to IP-based services. Several commenters state that discontinuance of wholesale services used by competitive LECs will necessarily, or is likely to, result in a discontinuance of service to retail end users. We address these concerns in the context of Section 214(a) and precedent by emphasizing that carriers must consider the impact of their actions on end user customers, including the end users of carrier-customers.

105. We reiterate that our intent is to fulfill our statutory duty to safeguard the public interest while also facilitating technology transitions and that “[t]o say that section 214 applies does not mean that section 214 approval will be withheld.” We also recognize that a carrier's discontinuance, reduction, or impairment of a wholesale service may not always discontinue, reduce, or impair service to retail end users. Rather, we emphasize that a carrier must undertake a meaningful evaluation of the situation, as discussed in greater detail below.

106. Our decision will ensure that the Commission is informed and able to fulfill its statutory duty with respect to discontinuances, reductions, or impairments of service used as a wholesale input, but it also ensures that carriers need not file an application where no such discontinuance, reduction, or impairment occurs. In addition, Section 214(a) states that no authorization is required “for any installation, replacement, or other changes in plant, operation, or equipment, oth

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