NEWSReport No. DC 96-79    ACTION IN DOCKET CASE             August 7, 1996

            COMMISSION IMPLEMENTS GEOGRAPHIC RATE AVERAGING 
                  AND RATE INTEGRATION REQUIREMENTS OF 
                   THE TELECOMMUNICATIONS ACT OF 1996;
      Rules protect long distance customers in rural and high-cost 
            areas from paying more than those in urban areas
                          (CC Docket No. 96-61)

 The Commission today adopted an Order implementing the geographic rate averaging
and rate integration requirements of the Telecommunications Act of 1996 (1996 Act).   
Geographic rate averaging refers to the practice of charging customers the same rates for
equivalent long distance service regardless of geographic location.   Rate integration refers to
the practice of requiring carriers to provide long distance service to all U.S. states, territories
and possessions on the same terms.

 Consistent with the 1996 Act, the Commission's geographic rate averaging decisions
released today require that rates charged by a long distance provider to subscribers in rural
and high cost areas shall be no higher than the rates charged to its subscribers in urban areas. 
The Commission stated that carriers may comply with geographic rate averaging requirements
by offering their customers the same rates for calls of similar distance, duration, and time of
day.  The 1996 Act and the Commission's implementing rules require that, when long
distance carriers lower their rates for urban customers, customers in rural and high cost areas
must share that benefit as well.  The Commission stated that Section 254(g) of the Act and
the implementing rules released today codify the Commission's existing policy.  In addition,
states will play an active role in enforcing intrastate geographic rate averaging, and are free to
establish intrastate rates that do not conflict with the Act.

 The Commission stated that, with respect to rate integration, a long distance carrier
shall provide service to its subscribers in each state at rates no higher than the rates charged
to its subscribers in any other state, as required by section 254(g) of the 1996 Act.  The
Commission also determined that the statute requires that the rate integration provisions of the
Act apply to all U.S. Territories and Possessions, which include Guam, the Northern
Marianas, and American Samoa.

 Based on recommendations from the Guam/Northern Marianas Working Group, the
Commission concluded that long distance carriers providing service to Guam, the Northern
Marianas, and American Samoa must achieve rate integration for those points by August 1,
1997.  The Commission directed those carriers to submit preliminary plans for rate integration
for these points by February 1, 1997, and final plans, including proposed rates, by June 1, 1997.

 Action by the Commission August 7, 1996, by Report and Order (FCC 96-331). 
Chairman Hundt, Commissioners Quello, Ness and Chong.

                                    -FCC-

News Media contact:  Mindy J. Ginsburg at (202) 418-1500
Common Carrier Bureau contacts:  Sherille Ismail and Neil Fried at (202) 418-1520.