VI. Collocation
A. State Tariff as Collocation Option
Level 3 proposes that it be allowed to choose between the negotiated terms specified in the Agreement and those contained in SBC's state tariff for purposes of collocating with SBC. SBC contends that the negotiated terms in the Physical Collocation and Virtual Collocation Appendices should be the exclusive terms governing the parties' physical and virtual collocation arrangements.
SBC points to the FCC's "all or nothing" rule that prohibits carriers from picking and choosing from among collocation rates, terms and conditions from another interconnection agreement. However, as SBC acknowledges, the FCC's "all or nothing" rule was made in a different context. It is one thing to allow a carrier to pick and choose between individual terms that were negotiated in the context of a comprehensive agreement; doing so creates a disincentive to give and take in interconnection agreements. It is another thing to allow a carrier to opt into a state tariff.
SBC cites decisions by the federal courts of appeal in the 6th and 7th Circuits rejecting certain state commissions' orders requiring the incumbent local exchange carriers to file tariffs setting forth interconnection rates and terms as alternatives to negotiation and arbitration under the Telecommunications Act,34 and argues that that interconnection agreements are the exclusive vehicle through which a competitive local exchange carrier obtains interconnection or access to an incumbent local exchange carrier's UNEs.
However, as the court found in U.S. West Communications, Inc. v. Sprint Communications Co.,35 and as cited favorably in Verizon North,36 a provision in an interconnection agreement allowing a competitor to elect services at the rates and terms set forth in state tariffs filed by the incumbent in addition to the rates and terms set forth in the interconnection agreement is distinguishable from requiring incumbents to file state tariffs as alternatives to negotiation and arbitration. Such a provision "does not eliminate interconnection agreements, but rather is part of one" and "does not result in abandonment of the interconnection agreement" between the competitor and the incumbent.37
SBC asserted in its brief that in any event it has no collocation tariff in California, making Level 3's proposal irrelevant. The Draft Arbitrator's Report rejected Level 3's language on the basis that it makes no sense for the agreement's collocation terms to make reference to non-existent California collocation tariffs. In its comments on the Draft Arbitrator's Report, Level 3 reiterates its statement in its reply brief disputing SBC's claim that it has no collocation tariff in California, cites to Cal. Schedule P.U.C. No. 175-T, Section 16, and refers to http://www.sbc.com/Large-Files/RIMS/California/Access/ca-ac-16.pdf. SBC, in its reply comments on the Draft Arbitrator's Report, does not dispute this reference, but maintains that Level 3's language should be rejected regardless of whether there is a collocation tariff in California because it is unlawful.
I reject SBC's assertion that federal law bars an interconnection agreement from providing that a competitor may purchase services at the rates and terms set forth in the incumbent's tariff. The tariff cited by Level 3 is a Commission-approved tariff. It is reasonable to provide that Level 3 may opt for the rates and terms set forth in SBC's tariff in addition to those specified in the interconnection agreement.
I therefore adopt Level 3's proposed language in § 7.3 of the Physical Collocation Appendix, and reject SBC's proposed language in § 4.4 of the Physical Collocation Appendix and §§ 1.2 and 1.10 of the Virtual Collocation Appendix.
B. Collocation of Equipment SBC Believes is Non-Compliant
This dispute concerns whether Level 3 should be permitted to collocate equipment that SBC believes is non-compliant while the dispute over such compliance or non-compliance is pending. SBC and Level 3 agree that Level 3 is not permitted to collocate unnecessary or unsafe equipment. Level 3 contends, however, that SBC's proposed language precluding collocation of disputed equipment pending dispute resolution unreasonably gives SBC the unilateral discretion to deny collocation.
Contrary to Level 3's complaint, precluding the collocation of equipment while a dispute over its compliance is pending does not give SBC unilateral discretion over its placement. The agreement's dispute resolution procedures guard against such abuse.
Level 3 complains that SBC's proposed language allows it to unnecessarily delay Level 3's ability to compete and provide services to its customers. By way of example, Level 3's witness Bilderback describes an episode where SBC disputed Level 3's representation that its proposed collocation equipment met safety standards, resulting in a delay of over a month in the collocation of equipment that SBC ultimately agreed could be collocated.
It is tautological that precluding collocation while a dispute is pending will result in unnecessary delay if the equipment is ultimately determined to be safe or necessary. However, precluding collocation of equipment while a dispute is pending may also prevent harm to SBC's system, as a result of unsafe equipment, or unnecessary cost to Level 3, as a result of having to remove unnecessary equipment, in the event that collocation is ultimately denied. On balance, the more prudent course is to prohibit collocation pending the resolution of the dispute.
Level 3 asserts that SBC's proposed language is barred by 47 C.F.R. § 51.323(c) which provides that an incumbent local exchange carrier "may not object to the collocation of equipment on the grounds that the equipment does not comply with safety or engineering standards that are more stringent than the safety or engineering standards that the incumbent LEC applies to its own equipment." This provision has nothing to do with objections based on failure to meet applicable safety standards.
Level 3 asserts that the FCC's Collocation Remand Order38 resolved this issue in Level 3's favor. To the contrary, the FCC order addressed the substantive interpretation of the term "necessary." It did not address whether equipment may be collocated while a dispute over whether the equipment is "necessary" is pending.
The choice here is between permitting collocation during a dispute, and precluding it until and unless it is found to be in compliance. The prudent course is to preclude it until it is determined that the equipment meets applicable safety standards and is necessary.
Accordingly, I resolve Issues PC-2 and VC-2 by adopting SBC's proposed language in § 1.10.10 of the Virtual Collocation Appendix and § 6.13 of the Physical Collocation Appendix.
34 See Wisconsin Bell, Inc. v. Bie, 340 F.3d 441 (7th Cir. 2003); Indiana Bell Tel. Co. v. Indiana Util. Reg. Comm'n, 359 F.3d 493 (7th Cir. 2004); Verizon North, Inc. v. Strand, 367 F.3d 577 (6th Cir. 2004); and Verizon North, Inc. v. Strand, 309 F.3d 935 (6th Cir. 2002).
35 275 F.3d 1241, 1251 (10th Cir. 2002).
36 309 F.3d at 943.
37 275 F.3d at 1251.
38 Deployment of Wireline Services Offering Advanced Telecommunications Capability, CC Docket No. 98-147, Fourth Report and Order, 16 FCC Rcd 15345, FCC 01-204 (rel. Aug. 8, 2001), aff'd sub nom. Verizon Telephone Cos. V. FCC, 293 F.3d 903 (D.C. Cir. 2002).
