IV. CONCLUSION

We have reviewed each and every allegation of error asserted by the rehearing applicant, and are of the opinion that legal error was not demonstrated. However, we grant limited rehearing to modify our holding with respect to whether FCC rules on FTTH, FTTC, and hybrid loop rules apply to all customers, or only to mass market customers. We originally held that these rules apply only to mass market customers. Upon reconsideration of this issue, we have determined that FTTH, FTTC and hybrid loop rules apply to all customers. In addition, we clarify the Decision in certain respects, as discussed herein, and we correct typographical errors. The rehearing of D.06-01-043, as modified, is denied in all respects.

THEREFORE, IT IS ORDERED:

1. Limited rehearing of D.06-01-043 is granted for purposes of modifying the Decision in order to find that the FCC's FTTH, FTTC, and hybrid loop rules apply to all customers. Thus, D.06-01-043 is modified as follows:

a. Paragraph 1 on page 8 of the Decision is deleted and replaced with the following language:

We place no particular significance on the fact that the sections on FTTH loop (¶¶273-284) and hybrid loop (¶¶285-297) appear in a section of the TRO entititled "Specific Unbundling Requirements for Mass Market Loop." Rather, we find it significant that the FCC was careful to delete from the rules any qualification limiting the scope of the relief to a particular market segment, and chose instead to use the broad term "customer premises." As previously stated, the text of FTTH Rule 51.319(a)(3)(i) was modified in the TRO Errata, replacing "residential unit" with "an end user's customer's premises."⁷⁶ In addition, the text of the hybrid loop rule makes no reference to customer classes: "An incumbent LEC is not required to provide unbundled access to the packet switched features, functions and capabilities of its hybrid loop."⁷⁷ Furthermore, as SBC noted, the heading cannot be used to limit the applicability of the rules themselves.

Therefore, we find that the FCC's FTTH, FTTC, and hybrid loop rules apply to all customers. The CLECs' proposed language in Sections 0.1.2, 0.1.3 and 0.1.4, which limits the rules to mass market customers is rejected. SBC's language is adopted.

b. Finding of Fact No. 2 is deleted and replaced with the following:

The rules adopted for FTTH/FTTC and hybrid loops apply to all customers.

2. For purposes of clarification and to correct clerical errors, D.06-01-043 is modified as follows:

a. Page 50, paragraph 3, second line down which reads "Rule 319(e)(2)(ii)(B)" is modified to read as "Rule 51.319(e)(2)(ii)(B)."

b. Page 51, paragraph 1, next to last sentence, is modified to read as follows:

The Rule itself should not be read in a vacuum, but within the context of the dicta that led to the creation of the rule.

c. The following language shall be inserted on Page 72, paragraph 3 immediately preceding:

We find that a one-year limitation on the grandfathering requirement is reasonable because CLECs should be able to transition to another service within that amount of time.

d. Finding of Fact No. 42 is modified to read as follows:

SBC should be required to grandfather for up to one year the special access services in its California tariff, in the event that loss of the service would impact a CLEC's commingling arrangement.

e. Finding of Fact No. 52 is modified as follows:

Entrance facilities, when used for interconnection purposes pursuant to Section 251(c)(2), shall be priced at TELRIC rates.

f. Finding of Fact No. 53 is modified as follows:

The FCC requires ILECs to interconnect their signaling networks with those of CLECs, at TELRIC rates, pursuant to Section 251(c)(2).

g. Conclusion of Law No. 8 is added to state:

The FCC's Rule §51.319 applies to all customers.

h. Conclusion of Law No. 9 is added to state:

The non-impairment of entrance facilities does not nullify a CLEC's right to obtain interconnection facilities pursuant to Section 251(c)(2) for the transmission and routing of telephone exchange service and exchange access service.

i. Conclusion of Law No. 10 is added to state:

CLECS are entitled to interconnect to AT&T's SS7 network pursuant to Section 251(c)(2).

The rehearing of D.06-01-043, as modified, is hereby denied in all respects.

This order is effective today.

Dated January 11, 2007, at San Francisco, California.

MICHAEL R. PEEVEY

President

DIAN M. GRUENEICH

JOHN A. BOHN

RACHELLE B. CHONG

Commissioners

⁷⁶ See Errata, Review of the Section 251 Unbundling Obligations of Incumbent Local Exchange Carriers, CC Docket No. 01-388, (FCC Oct. 29, 2004) 2004 F.C.C. LEXIS 6241, ¶11 ( ("FTTC Order Errata").

⁷⁷ 47 C.F.R. §51.319 (a)(2)(i).