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A. 1. a.(1)(a) i) a) 1 .1 .1 .1 .1 .1 .1 .1 TechnicalDoc InitInitialize Document StyleFz   0*0*0*  I. A. 1. a.(1)(a) i) a) I. 1. A. a.(1)(a) i) a)Documentg2MGZHHe^LILJCMPleadingHeader for Numbered Pleading PaperGE!n    X X` hp x (#%'0*,.8135@8:+\1,-,-,,\,& !0 2Ƙg ,hw#ijCAHAM/GRCAHAM Letterhead w/GRC Rosterg ?և@M T  \, yP%\$dddy #&m P7#{&P# Association of Home Appliance Manufacturers  701 Pennsylvania Avenue, N.W., Suite 900, Washington, DC 20004 Phone (202)434-7484 Fax (202)4347400  \, #x6X@8;wX@# \,  , yP%\pdddyyP%\dddy Figure 1  Figure 1 y!P%\,0*x""iiAHAMDC.WPG%y$\\&&\\&&` !\&$zA \ XMlddل  bD #O P7{P# GOVERNMENT RELATIONS COUNCIL  Terry Thiele, GE Appliances XXChairman Linda Greiner, Frigidaire Co. XXViceChairman Hall Northcott, Matsushita Doug Horstman, Maytag Corp. Robert Cushman, Amana Ref. A. J. Takacs, Whirlpool Corp.  bD  ALTERNATE MEMBERS:  Dan Elliott, White Consolidated Inds. Michael Thompson, Whirlpool Corp  bD  PORT. APP. DIV. LIAISON: Joe Berney, National Presto Neil Halvorson, West Bend William Yager, Rival Mfrg. Gary Turner, Teledyne Water Pik  bDc  SUPPLIER DIV. LIAISON:  Robert Brown, Robertshaw Controls Steven Bowsher, Ryerson Coil  bD  INFORMATION COPIES:  David Wolbrink, Broan Mfrg. James Ruberti, Brown Stove Works Ted Baily, Carrier Corp. Roni Liberman, Cold Point Corp. Thomas Benua, Ebco Mfrg. John Verwiel, Emerson Electric Joel Zillioux, Friedrich Lisa Bloom, GoldStar Elect. William Brashares, AHAM Counsel Gordon Stauffer, Northland Corp. Russell Zipkin, Russell Range Bunzo Shiono, Sanyo Fisher (USA) Anne Howard, Sharp Electronics Allen Wilkins, SubZero Freezer James Robinson, Toshiba America Philip Uihlein, ULine Corp. 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X4w  Federal Communications Commission`(#ZFCC 99243 ă   yx!dddy +` Before the [ FEDERAL COMMUNICATIONS COMMISSION  X'+Washington, D.C. 20554 ă  In the Matters of ) ) Implementation of the Local Competition)  XH4Provisions of the Telecommunications Act)ppCC Docket No. 9698 of 1996) ) Interconnection Between Local Exchange)  X 4Carriers and Commercial Mobile Radio)ppCC Docket No. 95185 Service Providers) ) Area Code Relief Plan for Dallas and )  X4Houston, Ordered by the Public Utility)ppNSD File No. 968 Commission of Texas) )  XK4Administration of the North American)ppCC Docket No. 92237 Numbering Plan) )  X4Proposed 708 Relief Plan and 630 Numbering)ppIAD File No. 94102 Plan Area Code by AmeritechIllinois) )  X4Petition for Declaratory Ruling)ppNSDL9615 Regarding Area Code Relief Plan for) Area Codes 508 and 617, filed by) the MassachusettsDepartment) of Public Utilities) ) New York Department of Public Service)  X 4Petition for Expedited Waiver of)ppNSD File No. L9803 47 C.F.R. Section 52.19(c)(3)(ii))  X4D  THIRD ORDER ON RECONSIDERATION  X 'a OF SECOND REPORT AND ORDER AND ă  X!4  MEMORANDUM OPINION AND ORDER ă  X#4Adopted:` ` September 13, 1999hhCqppReleased:  *October 21, 1999 By the Commission:":& +v(v(i$"  X' 88  -TABLE OF CONTENTS  X4    X\I. INTRODUCTION p>"(# 1 X\II. EXECUTIVE SUMMARY p>"(# 3 X\III. DISCUSSION p>"(# 4  X14XX` ` A.` ` Area Code Implementation Guidelines ` p>"(# 5  X 4XX` ` X ` ` 1. Using MTAs to Define Overlay Areas p!(# 10  X 4XX` ` X ` ` 2. Implementing Area Code Overlays in Conjunction with Telephone Number Portability p"(# 14  X 4XX` ` X ` ` 3. Allocation of a Single NXX Code p"(# 22  X 4XX` ` X ` ` 4. Mandatory 10Digit Dialing p"(# 28  X 4XX` ` X ` ` 5. 10digit Dialing for National 555 Numbers p"(# 46  X4XX` ` X ` ` 6. Takebacks and Grandfathering of Wireless Numbers in a Geographic Area Code Split p"(# 53  Xb4XX` ` B.` ` Discriminatory NXX Code Opening Charges ` p"(# 72  XK4XX` ` C.` ` Paging and "Telephone Exchange Service" ` p"(# 87  X44XX` ` D.` ` Cost Recovery for Numbering Administration ` p"(# 92  X4X\IV. PROCEDURAL MATTERShhC p!(# 101  X4XX` ` A.` ` Regulatory Flexibility Act ` p!(# 101  X4XX` ` B.` ` Paperwork Reduction Act ` p!(# 102 X\V. ORDERING CLAUSES p!(# 103 X\APPENDIX A LIST OF PARTIES p!(# A1 X\APPENDIX B AMENDMENTS TO THE CODE OF FEDERAL REGULATION p!(# B1 X\APPENDIX C SUPPLEMENTAL FINAL REGULATORY FLEXIBILITY ANALYSIS p!(# C1 Л"0*%%ZZZ"     X4 I. A. 1. a.(1)(a) i) a) I. 1. a.(1)(a) i) a)M: I. INTRODUCTION ă  X4 e 1. ` ` In amending the Communications Act of 1934s {O4'ԍ 47 U.S.C.  151 et seq. ("Communications Act" or "the Act").s by passing the Telecommunications  X4 xAct of 1996,}Z yO'ԍ Telecommunications Act of 1996, Pub. L. No. 104104, 110 Stat. 56 ("1996 Act"). } Congress sought to establish "a pro-competitive, de-regulatory national policy  X4 xAframework" for the United States telecommunications industry. yO( 'ԍ S. Conf. Rep. No. 104-230, 104th Cong., 2d Sess. 1 (1996) (Joint Explanatory Statement). On August 8, 1996, the  Xv4 xCommission sought to implement this policy by adopting and releasing the Local Competition  Xa4 xpSecond Report and Order,az yO ' x ԍ Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, Interconnection  x Between Local Exchange Carriers and Commercial Mobile Radio Service Providers, Area Code Relief Plan for Dallas  xt and Houston Ordered by the Public Utilities Commission of Texas, and Administration of the North American  {O' x Numbering Plan, Second Report and Order, and Memorandum Opinion and Order, CC Docket No. 9698, 11 FCC  {O' x Rcd 19392, (1996) (Local Competition Second Report and Order), vacated in part sub nom. People of the State of  {Ox' x California v. Federal Communications Commission, 124 F.3d 934 (8th Cir. 1997), rev'd, AT&T Corp. v. Iowa Util.  {OB'Bd., 119 S.Ct 721 (1999). in which the Commission promulgated rules and policies to require  x<incumbent local exchange carriers (LECs) to provide competitors with access to the incumbent  xLECs' networks sufficient to create a competitively neutral playing field for new entrants.  xAmong these rules, the Commission required incumbent LECs to provide competitors with  xprompt notification of network changes and with nondiscriminatory access to directory assistance  x&and directory listing to ensure that customers of all LECs would have access to accurate directory  x/assistance information. The Commission also required incumbent LECs to provide competitors  xlwith "dialing parity," which would allow a customer to use the carrier of his or her choice for  x#local and toll calls without having to dial extra digits to reach that carrier. Finally, the  xcCommission adopted rules to ensure that telephone numbers would be distributed and area code relief implemented in a competitively neutral manner.  XO4 e r2. ` ` On July 19, 1999, the Commission released an order denying the petition for  X84 x3reconsideration of the Local Competition Second Report and Order filed by Beehive Telephone  X#4 xCompany, Inc.)$#  {O ' x; ԍ Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, Interconnection  x Between Local Exchange Carriers and Commercial Mobile Radio Service Providers, Area Code Relief Plan for  x Dallas and Houston Ordered by the Public Utilities Commission of Texas, and Administration of the North American  {O"'Numbering Plan, First Order on Reconsideration, CC Docket No. 9698, FCC 99170, 1999 WL 507245 (1999).) Subsequently, on September 9, 1999, the Commission released an order resolving  X 4 xpetitions for reconsideration of the Local Competition Second Report and Order's rules  X4 ximplementing the requirement of section 251(b)(3)C yOV&'ԍ 47 U.S.C.  251(b)(3).C that LECs provide nondiscriminatory access">0*''ZZ"  X4 x~to directory assistance, directory listing and operator services. {Oy' x ԍ Implementation of the Telecommunications Act of 1996, Telecommunications Carriers' Use of Customer  x Proprietary Network Information and Other Customer Information, Implementation of the Local Competition  x} Provisions of the Telecommunications Act of 1996, Provision of Directory Listing Information under the  {O' xD Telecommunications Act of 1934, as Amended, Third Report and Order, CC Docket No. 96115, Second Order on  x Reconsideration of the Second Report and Order, CC Docket No. 9698, Notice of Proposed Rulemaking, CC Docket  {Oe'No. 99273, FCC 99227 (1999) (Subscriber List Information/Directory Assistance Order and Notice). In this Third Order on  xNReconsideration and Memorandum Opinion and Order, we resolve the issues concerning  xnumbering administration raised in Petitions for Reconsideration or Clarification filed in response  X4 xto the Local Competition Second Report and Order.F yO 'ԍ A list of petitioners and commenting parties appears at Appendix A.  "[ SBC Communications Inc. (SBC) filed its Petition for Reconsideration on behalf of its subsidiaries,  x; Southwestern Bell Telephone Company (SWBT) and Southwestern Bell Mobile Systems (SWBMS). SBC, however,  x did not file its Petition for Reconsideration until October 8, 1996, one day after the 30 day filing period required  {O' x by section 405(a) of the Act had expired. See 47 U.S.C.  405(a); 47 C.F.R.  1.429(d). SBC filed a motion  x requesting that we accept its latefiled pleading. MFS filed a motion to dismiss SBC's latefiled Petition for  {O,' x Reconsideration and an opposition to SBC's motion to accept that pleading. In the Local Competiton Second Report  {O' x and Order, Second Order on Reconsideration, the Commission denied SBC's motion, see FCC 99227,  112, n.318, but decided to treat SBC's Petition for Reconsideration as an informal comment.  " On January 12, 1998, the State of New York Department of Public Service filed a Motion for Leave to File  x Supplemental Petition, Supplemental Petition for Reconsideration and an Affidavit in Support of Supplemental  xQ Petition for Reconsideration with the Commission. Because the NYDPS Supplemental Petition merely amends its  x timelyfiled initial Petition for Reconsideration, we grant this motion. Issues addressed in Discussion Part I of the  {Op' x NYDPS Petition for Reconsideration are disposed of in the New York Department of Public Service Petition for  {O:' x@ Expedited Waiver of 47 C.F.R. 52.19(3)(C)(ii), CC Docket No. 9698, DA 981434 (rel. July 20, 1998). Issues addressed in Discussion Part II are addressed within this order. 47 U.S.C.  154(j). We also resolve certain issues raised by the  X4 xNew York State Department of Public Service (NYDPS) concerning our 10-digit dialing rule,C ( {O' x. ԍ As discussed in paragraphs 28 through 45, infra, and in the Local Competition Second Report and Order, the  x Commission requires states to initiate mandatory tendigit dialing where a state had implemented an area code  {O' x& overlay. The NYDPS had filed an application for review of the July 20 New York Order denying the NYDPS  x request for expedited waiver of the ten digit dialing rule. New York Department of Public Service Petition for  {O' x Expedited Waiver of 47 C.F.R. Section 52.19(c)(3)(ii), Order, NSD File No. L9803, DA 981434, 13 FCC Rcd  {Om' x* 13491 (1998) (July 20 New York Order). The NYDPS had also filed a petition to stay both the July 20 New York  {O7' x Order as well as ten digit dialing portion of the Local Competition Second Report and Order, for a period of seven  {O ' x months following the completion of judicial review of the orders. As discussed in paragraph 30, infra , the NYDPS  x also sought and was granted a stay of the Commission's 10 digit dialing requirement by the United States Court of Appeals for the Second Circuit.C  xand resolve the Petition for Declaratory Ruling filed by the Commonwealth of Massachusetts  xDepartment of Public Utilities requesting that we clarify whether states may allow wireless"x 0*%%ZZ"  X4 x customers to retain wireless telephone numbers in an area code>  yOy' xt ԍ Area codes are derived from Numbering Plan Areas (NPAs) created in the 1940's by AT&T as part of an  x integrated toll dialing plan that involved dividing the U.S. and Canada into eightythree "zones," each of them  x identified by three digits. These "zones" are now referred to as NPAs or area codes, and the three digits representing  {O' x. these areas are referred to as NPA codes or area codes. See Administration of the North American Numbering Plan,  {O' x CC Docket No. 92237, Report and Order, 11 FCC Rcd 2588, 2593  8 (1995). Currently, the North American  x Numbering Plan (NANP) area consists of the United States, Canada, and a number of Caribbean countries. There  xx are geographic NPAs which correspond to discrete geographic areas within the NANP Area and nongeographic  xb NPAs that are instead assigned for services that transcend specific geographic boundaries, such as NPAs in the toll  {O' xk free 800number format. See Industry Numbering Committee, Central Office Code (NXX) Assignment Guidelines  {O '(reissued April 1997) (CO Code Guidelines).> subject to a "geographic split." h  {O ' x ԍ See Petition for Declaratory Ruling by Commonwealth of Massachusetts Department of Public Utilities, NSD {O ' x L9615 (Oct. 9, 1996) (DPU Petition). A geographic split occurs when the geographic area of an existing area code  x is split into two parts, and roughly half of the telephone customers continue to be served through the existing area  {Ou ' xk code and half must change to the new area code. See Local Competition Second Report and Order, 11 FCC Rcd  {O?'at 19513  273. A list the parties commenting on the DPU Petition is included in Appendix A.  xIn future orders we will resolve petitions for reconsideration filed in response to the  X4 xCommission's rules implementing dialing parity under section 251(b)(3) of the Act,C   yO'ԍ 47 U.S.C.  251(b)(3).C and network  X4disclosure under section 251(c)(1) of the Act.C  yO'ԍ 47 U.S.C.  251(c)(1).C  X4 II. EXECUTIVE SUMMARY ă  X_4 e v3. ` ` Section 251(e)(1) of the Act grants the Commission "exclusive jurisdiction over  xthose portions of the North American Numbering Plan (NANP) that pertain to the United  X14 xStates."m1@ {O"'ԍ 47 U.S.C.  251(e)(1), see infra  48.m In this Order, we exercise that jurisdiction and affirm our area code implementation  X 4 xguidelines by declining to permit area code overlays based on major trading areas (MTAs),N  {O'ԍ See infra  913.N and  xby declining to require permanent number portability as a condition precedent to the  X 4 ximplementation of area code overlays.U d {O!'ԍ See infra  1421.U We revise our guidelines by eliminating the requirement  x"that an area code overlay plan include the assignment of at least one central office code (NXX  xcode) to each new entrant that had no NXX codes in the original area code 90 days before" 0*%%ZZ "  X4 xintroduction of the new overlay code.U {Oy'ԍ See infra  2227.U We affirm our area code guidelines' requirement that  X4 xstates must impose 10 digit dialing where they have implemented an area code overlay,OZ {O'ԍ See infra  2845.O and  xpclarify that state commissions may allow callers to dial national 555 numbers using 7 digits, even  X4 xRif the call is placed from an area code subject to an overlay.O {OX'ԍ See infra  4652.O In response to the Petition for  x}Declaratory Ruling filed by the Commonwealth of Massachusetts Department of Public Utilities  xE(MDPU), we find that state commissions may "takeback" or "grandfather" Type 2 wireless  Xv4 xnumbers when an area code undergoes a geographic split.Ov~ {O 'ԍ See infra  5371.O In addition, we authorize state  xregulatory commissions to resolve issues involving fees charged for the assignment and activation  XH4 x+of NXX codes and we find that LECs are to assess no fees for opening NXX codes.OH {O 'ԍ See infra  7286.O We  X14 xcontinue to extend many protections under the Act to paging service providers.O1 {O'ԍ See infra  8791.O Finally, we  xIaffirm that our numbering administration cost recovery formula is competitively neutral and that  X 4 x"we will retain this method for the current funding year.P 4  {O'ԍ See infra  92100.P We note, however, that in a separate  xFproceeding we have concluded that, in order to lessen the regulatory burden on all  xtelecommunications carriers, we should consolidate and streamline six carrier reporting  X 4 x"requirements!(  {O5' x ԍ These requirements are: NANP administration, 47 C.F.R.  52.1 et seq., Telecommunications Relay Services  {O' x (TRS) Fund, 47 C.F.R.  64.601 et seq., federal universal service support mechanisms, 47 C.F.R.  54.1 et seq.,  {O' x 69.1 et seq., and the cost recovery mechanism for longterm local number portability (LNP) administration, 47 C.F.R.  {O' 52.21 et seq.! into one report.&  {O%' xH ԍ 1998 Biennial Review Streamlined Contributor Reporting Requirements Associated with Administration of  x Telecommunications Relay Services, North American Numbering Plan, Local Number Portability, and Universal  {O' xl Service Support Mechanisms, Report and Order, FCC 99-175, CC Docket No. 98-171 (rel. July 14, 1999)  {O '(Contributor Reporting Requirements Order)at  5970. In order to include cost recovery for the administration of the  xNorth American Numbering Plan in the unified report, we concluded that the NANP cost" 0*%%ZZ+"  X4 xrecovery allocator should be changed to be consistent with the other reporting requirements.C {Oy'ԍ See infra  100.C  X4This requirement will begin in the billing cycle beginning March 2000.dZ {O'ԍ Contributor Reporting Requirements Order at  70.d  X4C III. DISCUSSION ׃   X4 e 4. ` ` Congress, in enacting the 1996 Act, and the Commission, through rulemaking  xcproceedings, have recognized that fair and impartial access to telephone numbering resources is  xIcritical for entities seeking to provide telecommunications services because "telephone numbers  xare the means by which telecommunications users gain access to and benefit from the public  X14 x switched telephone network."1 {O ' x ԍ Id. at 19508; see 1996 Act; see Administration of the North American Numbering Plan, CC Docket No. 92 {O'237, Report and Order, 11 FCC Rcd 2588, 2591  261 (1995) (NANP Order). In order best to effectuate impartial access to telephone numbers  xon a national scale, section 251(e)(1) of the Act grants the Commission "exclusive jurisdiction  x"over those portions of the North American Numbering Plan (NANP) that pertain to the United  X 4 xcStates." H {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19511  4; 47 U.S.C.  251(e)(1). Further, because some numbering issues are better resolved with the aid of state and  xlocal expertise, the Act states that "[n]othing in this paragraph shall preclude the Commission  X 4 xfrom delegating to state commissions or other entities all or any portion of such jurisdiction,"C  yOI'ԍ 47 U.S.C.  251(e)(1).C  xVallowing the Commission to delegate its exclusive authority over numbering issues. Based upon  xthis statutory language, the Commission retained its authority to set policy on number  xadministration matters but authorized the states to resolve certain matters involving the  ximplementation of new area codes "subject to the Commission's numbering administration  XK4guidelines."xKj  {Of'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19517  283.x  X' A.Area Code Implementation Guidelines  X4 e `5. ` ` Telephone numbers in the United States are composed of a 3digit numbering plan  xarea code (NPA code), a 3digit central office code (NXX code) and a 4digit line number. Area  xAcodes are assigned by Lockheed Martin IMS, which serves as the NANP Administrator  xg(NANPA). Prior to Lockheed's selection as NANPA, the incumbent LEC within each geographic" 0*%%ZZi"  X4 xarea had performed central office code assignment and area code relief functions,  yOy' x ԍ "Central office code" or "NXX code" refers to the second three digits (also called digits DEF) of a ten-digit  x* telephone number in the form NXX-NXX-XXXX, where N represents any one of the numbers 2 through 9 and X  {O ' x represents any one of the numbers 0 through 9. 47 C.F.R.  52.7(c). "Area code relief" refers to the process by  xx which central office codes are made available when there are few or no unassigned central office codes remaining in an existing area code and a new area code is introduced. 47 C.F.R.  52.7(b). in  X4 xcollaboration with Bell Communications Research, Inc. (Bellcore).!z yO' x/ ԍ Area codes were previously assigned by Bell Communications Research, Inc. (Bellcore), which was  x established on January 1, 1984, under the Plan of Reorganization as part of the divestiture of AT&T. Originally  x called the Central Services Organization, Bellcore was established to give support to the newly formed regional Bell  {Ol ' x Operating Companies in a manner similar to that which had been provided to AT&T by Bell Laboratories.  United  {O6 ' x States v. Western Electric, 569 F. Supp. 1057, 111318 (D.D.C. 1983) (approving creation of Central Services  {O ' x Organization proposed in Plan of Reorganization); aff'd sub nom. California v. United States, 464 U.S. 1013 (1983);  {O ' x see U.S. v. American Telephone & Telegraph Company and U.S. v. Western Electric Company, Modification of Final  {O ' x7 Judgment, 552 F. Supp. 131 (D.D.C. 1982), aff'd sub nom., Maryland v. United States, 460 U.S. 1001 (1983) (MFJ).  {O^' xQ Originally, Bellcore had been owned and controlled jointly by the Regional Bell Holding Companies (RHCs). See  yO(' x Implementation of Section 273 of the Communications Act of 1934, as amended by the Telecommunications Act  {O' x of 1996, CC Docket No. 96-254, Notice of Proposed Rulemaking, FCC 96-472, 62 FR 3638, 3645 (rel. Dec. 11,  {O' x 1996) (BOC Manufacturing NPRM). The RHCs, however, sold Bellcore to Science Applications International  {O' x Corporation (SAIC). See Letter from Louise L.M. Tucker, Bellcore, to Chmn. William Kennard, Commr. Michael  xx Powell, Commr. Gloria Tristani, Commr. Harold Furchtgott-Roth, Commr. Susan Ness, A. Richard Metzger, Jr., and Geraldine Matise, FCC dated November 17, 1997. Bellcore is now known as Telcordia Technologies.  " As new entities entered the telecommunications market, particularly wireless entrants in direct competition  x. with the wireline industry, the wireline industry's continued administration of the NANP became more controversial.  {O6' x North American Numbering Plan, CC Docket No. 92237, Third Report and Order and Third Report and Order,  {O' x para. 4 (rel. Oct. 9, 1997) (NANP Third Report and Order), citing NANP Order, 11 FCC Rcd at 2594  1112.  x The Commission directed the North American Numbering Council, a federal advisory committee created to advise  x the Commission on numbering matters, to recommend to the Commission an independent, nongovernment entity  x to serve as NANPA. In October 1997, the Commission affirmed the selection of Lockheed Martin IMS as the new  {O"' x^ NANPA, noting that it would perform the numbering administration functions performed by Bellcore. See NANP  {O'Third Report and Order at paras. 1, 20, 59.  "< On December 21, 1998, Lockheed Martin IMS notified the Commission that it had signed an agreement to  x sell the division which serves as the NANPA, Lockheed Martin Communications Industry Services (CIS), to the  x^ management of that division and to an affiliate of E.M. Warburg, Pincus & Company, known as Warburg, Pincus  {O' xk Equity Partners, L.P. See Request of Lockheed Martin Corporation and Warburg, Pincus & Co. for Review of the  x Transfer of the Lockheed Martin Communications Industry Services Business from Lockheed Martin Corporation  x to an Affiliate of Warburg, Pincus & Co., CC Docket No. 92-237, NSD File No. 98-151, at 1, 5 (Dec. 21, 1998) (Lockheed Martin Request).  "_ The Common Carrier Bureau solicited input from the public concerning the Lockheed Martin Request,  xL asking that interested parties submit to the Bureau a list of issues and questions that should be addressed by Lockheed  x Martin IMS prior to Commission determination of the request. FCC Seeks Comment on Request for Expeditious  {O%' x Review of the Transfer of the Lockheed Martin Communications Industry Services Business, Public Notice, CC"% 0*%%]$"  x Docket No. 92-237, NSD File No. 98-151, DA 99-117, at 6 (rel. Jan. 7, 1999). On January 27, 1999, the Bureau  x| directed certain questions to Lockheed Martin, which Lockheed Martin addressed in a filing dated February 16, 1999.  x Lockheed Martin IMS Responses to Questions and Issues Regarding Transfer of the Lockheed Martin Communications Industry Services Business, CC Docket No. 92-237, NSD File No. 98-151.  " On February 17, 1999, the Bureau gave notice of Lockheed Martin's responses, and solicited further  x comment from the public on whether the Lockheed Martin Request should be granted. FCC Seeks Comment on  x Request for Expeditious Review of the Transfer of the Lockheed Martin Communications Industry Services Business,  {O' x Public Notice, CC Docket No. 92-237, NSD File No. 98-151, DA 99-347 (rel. Feb. 17, 1999). Comments from the  {O'public were due on April 16, 1999. Id. In October, 1997, the"d !0*%%ZZ"  xICommission affirmed the selection of Lockheed Martin IMS as the new NANPA, noting that it  xwould perform the numbering administration functions previously performed by Bellcore, as well  xas area code relief planning and CO code administration, previously performed by the incumbent  X4LECs."d  {O 'ԍ See NANP Third Report and Order, 12 FCC Rcd at 2304142, 2305152, and 2307172.  X4 e 6. ` ` Typically, there are 792 NXX codes available for assignment in an area code,  xcounting every possible combination of three digits excluding numbers beginning with a 0 or a  X_4 x1 and numbers ending with 11.#_  {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19511  267, n.573. In turn, each NXX code has approximately 10,000 numbers  xuavailable for assignment to individual customers. NXX codes are assigned to a particular  X14 xRgeographic rate center in an area code$1  yOj' x; ԍ Rate centers are telephone companydesignated geographic locations that are assigned vertical and horizontal  {O2' x^ coordinates within an area code. NEWTON'S TELECOM DICTIONARY, 11th Edition, at 498. See also Local Exchange  x Routing Guide (LERG), Volume 2, Section 1 at 24 (March 1997). Incumbent LECs have established the existing  {O' x rate center configuration. See Ex parte letter from Judith E. Herrman, TCG, to William F. Caton, FCC, dated March 19, 1997 (TCG March 19, 1997 ex parte). and a carrier with a particular NXX can only serve  xcustomers associated with the rate center to which the NXX is assigned. The number of NXXs  xcassociated with a rate center varies according to population density and the consequent demand for telephone numbers in the geographic area covered by the center.  X 4 e J7. ` ` The Local Competition Second Report and Order authorized the states, incumbent  xuLECs, and the NANPA to continue to initiate area code relief plans and perform ongoing  x<numbering administration functions pending transfer of numbering administration responsibilities  X{4 xZto the new NANPA.x%{< {Oh"'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19536  328.x A new area code is assigned when almost all of the NXX codes in an area"{ %0*%%ZZ""  X4 xcode are consumed. States can implement new area codes through a geographic split,w&Z yOy' x ԍ A geographic split occurs when "the geographic area using an existing area code is split into two parts, and  x! roughly half of the telephone customers continue to be served through the existing area code and half must change  {O 'to the new area code."  Id. at 19513  273.w a  X4 xrearrangement of existing area code boundaries' {O'ԍ States may realign area code boundaries to accommodate local needs.  Id.  or an area code overlay.(| yO' xD ԍ An area code overlay occurs when the "new area code covers the same geographic area as an existing area  {O'code; customers in that area may thus be served through either code." Id.   The Commission  xIconcluded that geographic splits and boundary realignments were presumptively consistent with  X4 xIour numbering administration guidelines.I) {OB 'ԍ Id. at 1951718  284.I The Commission, in the Local Competition Second  X4 xReport and Order, however, prohibited servicespecific or technologyspecific overlays, finding  X4that such overlays are unreasonably discriminatory and anticompetitive.i* h  {O' x ԍ Id. at 19518  285. On March 31, 1998, subsequent to the close of the record on reconsideration of the Local  {Ot' x Competition Second Deport and Order, the Connecticut Department of Public Utility Control (Connecticut  x Department) filed a Petition for a Rulemaking (titled a Petition for "Amendment to Rulemaking") requesting that  xD the Commission amend its rule against technologyspecific or servicespecific area code overlays. Pursuant to a  xD public notice released by the Commission on April 17, 1998, comments and reply comments were solicited on the  {O' x} Connecticut Department's request. See Connecticut Department of Public Utility Control Files Petition for  x Rulemaking, Public Comment Invited, Public Notice, DA 98-743 (rel. April 17, 1998). The proceeding is currently  x pending before the Commission. The Commission has incorporated this and other related proceedings into the  {O' x Numbering Resource Optimization Notice, in which it has announced its intent to reexamine its prohibition against  x technology specific overlays. Numbering Resource Optimization; Connecticut Department of Public Utility Control  x Petition for Rulemaking to Amend the Commission's Rule Prohibiting TechnologySpecific or ServiceSpecific Area  x Code Overlays; Massachusetts Department of Telecommunications and Energy Petition for Waiver to Implement a  x TechnologySpecific Overlay in the 508, 617, 781, and 978 Area Codes; California Public Utilities Commission; and  x the People of the State of California Petition for Waiver to Implement a TechnologySpecific or ServiceSpecific  {O' x  Area Code, Notice of Proposed Rulemaking, FCC No. 99122, CC Docket No. 99200 (Released June 2, 1999)  {Ol'(Numbering Resource Optimization Notice) at  257.i  Xc4 e 8. ` ` The Commission authorized state commissions to implement area code overlays  XL4 xIsubject to the guidelines enumerated in the Local Competition Second Report and Order and  X74 xysection 52.19 of our rules.?+7 yO 'ԍ 47 C.F.R.  52.19.? Specifically, the Commission concluded that a state commission  xcould choose to implement an allservices area code overlay plan only when the plan included  xthe following: (1) mandatory 10digit local dialing by all customers between and within area  xcodes in the area covered by the new code; and (2) availability to every existing  xtelecommunications carrier, including CMRS providers, authorized to provide telephone exchange" L+0*%%ZZ "  xhservice, exchange access, or paging service in the affected area code 90 days before the  xlintroduction of a new overlay area code, of at least one NXX in the existing area code, to be  X4assigned during the 90day period preceding the introduction of an overlay.4, {OK'ԍ Id. 4  X4 e 9. ` ` On June 2, 1999, the Commission released the Numbering Resource Optimization  X4 xNotice,@-Z {O'ԍ See supra, n.42.@ in which the Commission sought comment to establish national guidelines, standards,  xand procedures for number optimization. Subsequently, the Commission granted interim authority  Xc4 xto particular state commissions to implement certain number optimization measures.Q.p c {O ' x ԍ See California Public Utilities Commission Petition for Delegation of Additional Authority Pertaining to Area  {O ' x Code Relief and NXX Code Conservation Measures, Order, CC Docket No. 9698, FCC 99248, NSD File No. L98 {O ' xM 136 (rel. Sept. 15, 1999) (California Delegation Order); Florida Public Service Commission Petition to Federal  x Communications Commission for Expedited Decision for Grant of Authority to Implement Number Conservation  {O&' x Measures, Order, CC Docket No. 9698, FCC 99249, NSD File No. L9933 (rel. Sept. 15, 1999); Massachusetts  xQ Department of Telecommunications and Energy's Petition for Waiver of Section 52.19 to Implement Various Area  {O' x Code Conservation Methods in the 508, 617, 781, and 978 Area Codes, Order, CC Docket No. 9698, FCC 99246,  x NSD File No. L9919 (rel. Sept. 15, 1999); New York State Department of Public Service Petition for Additional  {OJ' x Delegated Authority to Implement Number Conservation Measures, Order, CC Docket No. 9698, FCC 99247, NSD  x File No. L9921 (rel. Sept. 15, 1999); Maine Public Utilities Commission Petition for Additional Delegated  {O' x Authority to Implement Number Conservation Measures, Order, CC Docket No. 9698, FCC 99260 (rel. Sept. 28,  {O'1999) (Maine Delegation Order).Q The  xICommission stated that these grants of interim authority are limited delegations of authority that  xdo not abrogate the state commissions' obligations to follow the area code implementation  X 4 xguidelines established in the Local Competition Second Report and Order, and will be superseded  xby the national guidelines, standards, and procedures that will be adopted in response to the  X 4comments sought by the Commission in the Numbering Resource Optimization Notice.1/$ $ {O' xk ԍ See, e.g., California Delegation Order at  79 (citing Pennsylvania Numbering Order, at 19027,  26); see  {O' x also Pennsylvania Numbering Order at 1901416,  68 (clarifying that Local Competition Second Report and Order  x limited state authority over numbering issues to implementing area code relief to ensure fair and timely availability of numbering resources to all telecommunications carriers).1  X ' 1.` ` Using MTAs to Define Overlay Areas  X4 ` ` a. Background  Xk4 e i 10. ` ` In the Local Competition Second Report and Order, the Commission did not  xcontemplate or discuss changing the geographic coverage of area code overlays, or the"V /0*%%ZZ"  x_realignment of area codes to reflect Major Trading Areas (MTAs), or other newly proposed geographic areas.  X4 ` ` b. Discussion  X4 e  11. ` ` Omnipoint asks that we modify the area code implementation guidelines to permit  Xw4 xarea code overlays based on MTAs.D0w yO'ԍ Omnipoint Petition at 78.D According to Omnipoint, a voluntary MTAbased area  xcode assignment scheme would allocate number resources more efficiently, facilitate the entry of  xcompetition into the local telecommunications marketplace, and would not discriminate against  X24 xcany service or technology.p1\2X {O; ' x ԍ Id. at 12. According to Omnipoint, MTAs were adopted as PCS license territories to allow licensees to tailor  x their systems to the natural geographic dimensions of PCS markets, and the Commission rejected geographic licenses  {O 'based on LATA boundaries. Id. at 8.p Omnipoint observes that, because most MTAs encompass several  xstates, the Commission itself, and not the states, would be required to oversee the implementation  X 4 xuof voluntary MTA area code overlays.:2 | {O1'ԍ Id. at 16.: Omnipoint states that the scarcity of numbering  xresources harms customers and that solutions that differ from the traditional approach of stateby X 4state number resource allocation must be found.93  {O'ԍ Id. at 5.9  X 4 e   12. ` ` BellSouth states that Omnipoint's petition should be denied because it is  xprocedurally improper and it is, in reality, a petition for rulemaking rather than a petition for  xreconsideration because it seeks to alter the underpinnings of the NANP's area code system and  Xc4 xassignment guidelines.D4c yO'ԍ BellSouth Opposition at 6.D U S WEST states that the Commission should refer Omnipoint's  XL4 xproposal to the Industry Numbering Committee (INC) for initial consideration.t5L0  {O-'ԍ U S WEST Opposition at 10 n. 14; see also BellSouth Opposition at 6.t Omnipoint  X54 xresponds that it may request reconsideration of those aspects of the Local Competition Second  X 4 xgReport and Order that delegate authority to the states and cause inefficiencies for its MTAbased  X 4 xRPCS operations.?6   yO~!'ԍ Omnipoint Reply at 4.? Omnipoint states that it raised the MTAbased area code proposal in this  X4 xproceeding, but the Local Competition Second Report and Order did not address the merits of" R 60*%%ZZ"  xits contention, and thus the Commission's procedural rules permit Omnipoint to seek  X4reconsideration of those portions of the rules and order that conflict with the proposal.A7 yOb'ԍ Omnipoint Reply at 45.A  X4 e   13. ` ` We decline in this order to implement the MTAbased area code proposal  xsuggested by Omnipoint. The current geographicbased area codes and number allocation system  X4 xwere neither issues on which comments were solicited in the Local Competition NPRM8X {O' x ԍ Implementation of the Local Competition Provisions in the Telecommunications Act of 1996, CC Docket No.  {O` '9698, Notice of Proposed Rulemaking, 11 FCC Rcd 14171 (1996) (Local Competition NPRM). nor the  Xx4 xresult of Commission action in the Local Competition Second Report and Order. While we agree  xthat innovative solutions to number exhaust must be developed, the present record is not sufficient  xto enable us to impose an MTAbased area code plan in this proceeding. We note that in the  X54 xNumbering Resource Optimization Notice, the Commission seeks comment on the feasibility of  xgexpanded area overlays as a means of allocating new numbering resources to areas facing exhaust  X 4of existing NPAs.d9  {On'ԍ Numbering Resource Optimization Notice, at  255.d  X ' e Vw 2.` ` Implementing Area Code Overlays in Conjunction with Telephone Number  X 'Portability (#`  X4 ` ` a. Background  Xi4 e  14. ` ` The Local Competition Second Report and Order stated that circumstances inw  xcertain localities may justify the use of area code overlays and that states are uniquely situated  X=4 xpto determine the type of area code relief that is best suited to local areas.x:=F {O4'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19517  283.x Area code overlays  xare sometime favored over geographic solutions based on splitting area codes because they do not  X4 xrequire existing telephone customers to change their telephone numbers.3; {O'ԍ Id.3 We also found,  xIhowever, customers would find it less attractive to switch carriers if new entrants had to assign  x"telephone numbers to their customers from the new, overlay area code, while incumbent LECs  xhad telephone numbers available for assignment to their customers from both the overlay code  X4and the old area code.O<j  {O"'ԍ Id. at 19519  287289.O " <0*%%ZZF"Ԍ X4 e 15. ` ` In the Local Competition Second Report and Order, we acknowledged our  xprevious finding that business and residential customers are often reluctant to switch carriers if  X4 x+they must change their telephone numbers to do so.F= {OM'ԍ Id. at 19520  290.F We declined, however, to require the  X4 ximplementation of permanent number portability>XZ yO' x ԍ Section 153(30) of the Act defines number portability as "the ability of users of telecommunications services  x to retain, at the same location, existing telecommunications numbers without impairment of quality, reliability or convenience when switching from one telecommunications carrier to another." 47 U.S.C.  153(30).  as a prerequisite to state implementation of  X4 xNPA overlays.}?z {O 'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1951920  290. } We found that although permanent number portability, when fully deployed,  x"will allow customers to keep their telephone numbers (including area codes) when they change  xllocal service providers, requiring permanent number portability prior to the implementation of  xan overlay would deny state commissions the option of implementing an overlay while many area  XJ4 xcodes are facing exhaust.F@J  {O'ԍ Id. at 19520  290.F Based on these considerations, we declined to require permanent  xservice provider number portability in an area code before an overlay code could be  X 4implemented.QA  {Ok'ԍ Id. at 1952021  290293.Q  X 4 ` ` b. Discussion  X 4 e 16. ` ` AT&T, Cox, MFS, MCI, NCTA, Sprint, and TCG maintain that area code overlays  xare inherently anticompetitive and should not be implemented without the deployment of  X4 xpermanent number portability to counter their discriminatory effects.B0  {Ot' xl ԍ See AT&T Petition at 9; Cox Petition at 2,5; MFS Petition at 6, 910; MCI Opposition at 8; NCTA Opposition at 13; Sprint Opposition at 78; TCG Opposition at 34. Several parties state that  x"interim number portability is not a suitable alternative to permanent number portability and does  x}not sufficiently mitigate the anticompetitive impact of overlays because it requires new entrants  XN4 xIto offer their customers lower quality service.iCN  yO'ԍ AT&T Petition at 89; Cox Petition at 5; TCG Petition at 1011.i According to NCTA, competitive LECs would  xface substantial competitive disadvantages in overlay areas where only interim number portability  X 4 xhas been implementedRD  yO"'ԍ Cox Petition at 5; NCTA Opposition at 6.R and MFS asserts that "interim portability entails significant additional  x/costs, makes inefficient use of scarce numbering resources, and cannot be used in all customer" D0*%%ZZC"  X4 x}situations.">E yOy'ԍ MFS Petition at 78.> TCG contends that RBOCs, which are also incumbent LECs, have no incentive to  xcdeploy permanent number portability because it is not on the competitive checklist under section  X4 x271 of the Act and the delay will thwart competition in overlay areas.>FX yO'ԍ TCG Opposition at 5.> TCG requests that the  xCommission allow state commissions the discretion to impose a permanent number portability  X4requirement, even if the Commission declines to do so.=G yO= 'ԍ TCG Petition at 12.=  Xv4 e ,17. ` ` BANM, however, claims that parties have failed to produce evidence that interim  xnumber portability has been inadequate or unworkable, because it permits customers to keep their  XH4 xcurrent numbers while switching to new service providers.HHx {Oq'ԍ BANM Opposition at 45; see PTG Opposition at 23; see also NYNEX Reply at 8. AirTouch asserts that the use of  xoverlays should not be postponed until permanent number portability has been implemented  xbecause the benefits of overlay relief, on balance, outweigh the concerns that interim number  X 4 x"portability results in lower quality service to subscribers.DI  yO'ԍ AirTouch Opposition at 12.D GTE and USTA state that requiring  xthe implementation of permanent number portability before overlays can be used would  xNessentially eliminate overlays as a source of area code relief because permanent number  X 4portability is still in its infancy and not yet technically feasible.UJ  yO 'ԍ GTE Opposition at 13; USTA Opposition at 4.U  X4 e v18. ` ` BANM and USTA contend that the Commission should not further intrude into  x8the decision making of state commissions by foreclosing the use of overlays until permanent  Xb4 xAnumber portability is deployed.Kb*  {O='ԍ BANM Opposition at 8; USTA Opposition at 4; see also SNET Opposition at 10. Cox, however, argues that mandating the availability of  xpermanent number portability before an overlay is implemented would not prevent states from  xladopting overlays because a state could simply enact speedier local deployment schedule for  X4permanent number portability.<L  yO 'ԍ Cox Petition at 7.<  X4 e F 19. ` ` We continue to believe that we should not condition the use of area code overlays  x/upon the national deployment of permanent number portability. Through the guidelines adopted  X4 x/in the Local Competition Second Report and Order, the Commission authorized the states to"L L0*%%ZZ"  X4 ximplement area code overlays as a method of area code relief.M {Oy'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1951617  281283. In that Order, the Commission  xalso rejected suggestions that it condition the use of area code overlays on the prior availability  X4 xof permanent number portability.INZ {O'ԍ Id. at 1951920  290.I Instead, we decided that mandatory 10digit dialing and the  xassignment of one NXX from the existing NPA for each new entrant competitor were sufficient  x/safeguards to protect competition if a state commission adopted an area code overlay plan. To  xthe extent that petitioners in this proceeding assert that area code overlays should be implemented  xNonly after permanent number portability is available, they merely restate the objections to  xoverlays that were presented in the original proceeding. Further, because permanent number  XJ4 x[portability in the top 100 metropolitan statistical areas (MSAs) is substantially deployed, OJ yO ' x ԍ The Commission mandated that LECs provide interim number portability to any requesting carrier during the  {O ' x transition period prior to the implementation of permanent number portability. Number Portability Order, 11 FCC  x Rcd at 8369  33. The phased deployment schedule for permanent number portability to be deployed in the 100  {OA' x largest Metropolitan Statistical Areas commenced October 1, 1997, and concluded December 31, 1998.  Number  {O 'Portability First Reconsideration Order, 12 FCC Rcd at 7326  27.   X34 xpetitioners' argument is largely moot.P3 yO' x ԍ Although the Commission issued an order forbearing from requiring commercial mobile radio service (CMRS)  xb providers to supply service provider number portability in the top 100 Metropolitan Statistical Areas until November  {O' x 24, 2002, Cellular Telecommunications Industry Association's Petition for Forbearance from Commercial Mobile  {O' x Radio Services Number Portability Obligations and Telephone Number Portability, WT Docket No. 98-229,  {O' x Memorandum Opinion and Order, FCC 99-19 (rel. Feb. 9, 1999) (CMRS LNP Forbearance Order), this decision  x does not justify any delay in efforts such as area code overlays to promote the efficient use of numbers by all  {O<'carriers. See id.Ć Because petitioners have offered no new reason to  xrequire permanent number portability as a precondition for an area code overlay, we reject petitioners' requests for reconsideration of that aspect of our decision.  X 4 e T20. ` ` We have previously stated that "number portability is essential to ensure  X 4 xmeaningful competition in the provision of local exchange services."lQ  {O['ԍ Number Portability Order, 11 FCC Rcd at 8368  3031.l In the Local Competition  X 4 xSecond Report and Order, we stated that both interim and permanent number portability would  X4 x<allow customers to keep their telephone numbers when they changed telephone carriers.xR| {O 'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19520  290.x We  xhave also stated that the BOC checklist in section 271(c)(2) clearly contemplates that interim  xnumber portability methods should serve only as temporary methods until longterm number  XQ4 xportability can be provided.nSQ {O%'ԍ Number Portability Order, 11 FCC Rcd at 8412  115116.n As we discuss in paragraph 41, infra, interim number portability"QS0*%%ZZQ"  xhas technical limitations that do not fully ameliorate the perceived anticompetitive effects of  x/overlays. In order to offset these anticompetitive effect, we adopted further safeguards in our  xarea code guidelines, including a precondition of 10digit dialing where a state intends to  ximplement an all services overlay. We discuss petitions concerning our 10digit dialing  X4requirement in paragraphs 2845, infra.  Xx4 e 21. ` ` For the reasons stated above, we reaffirm our decision not to impose permanent  xnumber portability as a condition precedent to the implementation of area code overlay plans.  x We also emphasize that state commissions are authorized to make decisions regarding the relative  xmerits of area code splits, boundary realignments, and overlays so long as they act consistently with the Commission's guidelines.  X ' 3.` ` Allocation of a Single NXX Code  X 4 ` ` a. Background  X4 e 22. ` ` In the Local Competition Second Report and Order the Commission adopted two  xprovisions to ensure that competitors, especially new entrants, would not suffer competitive  xdisadvantages when an area code overlay was implemented: local 10digit dialing and the  XP4 xassignment of one NXX per new telephone exchange service provider.xTP {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19518  286.x In establishing the one X94 xMNXXcodepernewentrant requirement, the Commission concluded that a state commission could  xchoose to implement an overlay only if it ensured that at least one NXX code would be available  xin the existing area code for release to every telecommunications carrier, including any CMRS  xIprovider, authorized to provide telephone exchange service, exchange access, or paging service  X4 xin the existing area code during the 90day period preceding the introduction of the overlay.dUZ {O'ԍ Id.; see also 47 C.F.R.  52.19(c)(3)(iii).d  xThis requirement was designed to reduce the potential anticompetitive effect of an area code  xIoverlay by ensuring a new entrant access to numbering resources in both the old area code and  X4 xnew area code.xV {O5'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19519  288.x The Commission reasoned that otherwise an incumbent LEC would have a  xcompetitive advantage over a new entrant because the competing exchange service provider would  xhave to assign its customers telephone numbers in the new area code overlay while the incumbent  XS4 xpLEC could continue to assign numbers in the old area code to its customers.@WS~ {O"'ԍ Id. at  289.@ The Commission  xnoted that an incumbent LEC might have greater access to numbers in the old "desirable" area  x}code because it was able to warehouse NXXs in the old code and recycle numbers from the old"%W0*%%ZZI"  xarea code that were turned in by customers who moved, requested a new number, or changed to  X4a different service provider.4X {Ob'ԍ Id. 4  X4 ` ` b. Discussion  X4 e 23. ` ` A number of parties argue that allotting one NXX to a new entrant carrier does  xnot provide the new entrant a meaningful opportunity to compete in the older preoverlay area  x/code with an incumbent LEC who has usually reserved NXXs in the majority of rate centers in  XI4 xthat area code.~YIZ yOT 'ԍ AT&T Petition at 67; Cox Petition at 45; MFS Petition at 89; TCG Petition at 57.~ AT&T explains that an incumbent LEC will be able to assign numbers to  x"customers from rate centers across the entire old NPA while a new entrant carrier receiving a  xsingle NXX, pursuant to the Commission requirement, would be limited to assigning telephone  X 4 xnumbers from a single geographic rate center.?Z  yO'ԍ AT&T Petition at 67.? AT&T, MFS, and TCG state that this  xdisproportionate division of NXXs would handicap new entrants because they could not serve  xcustomers located outside of the geographic area of the central office associated with the one  X 4 xNXX and wanting numbers in the existing area code.D[Z z {O' x ԍ Id. at 67; MFS Petition at 8; TCG Petition at 57. TCG notes, however, that the one NXX requirement may  x help wireless providers because, unlike wireline LECs, they can spread their NXX code assignment over their entire area code service area.D In addition, the competitive advantage  xenjoyed by an incumbent LEC with NXXs in a majority of rate centers within an area code is  xenhanced as the incumbent LEC reuses numbers turned in by customers departing the area or  Xz4 xchanging carriers.Y\z yO'ԍ AirTouch Opposition at 9 and TCG Petition at 5.Y BellSouth disagrees with these parties and instead urges the Commission to  Xc4 xretract its statement in the Local Competition Second Report and Order that incumbent LECs'  XN4 xability to warehouse NXXs in the old area code gives them an advantage over new entrantsx]N,  {O+'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19519  289.x and  X74eliminate or modify the oneNXX codepernewentrant requirement.Z^7  yO'ԍ BellSouth Petition at 78; BellSouth Reply at 2.Z  X 4 e 24. ` ` Ameritech, Bell Atlantic, BellSouth, NYNEX, SNET, and USTA assert that the  xoneNXXcodepernewentrant requirement will accelerate the consumption of numbering  xresources and force the early depletion of area codes because area code relief planners must set  xaside a significant number of NXXs to distribute among competing carriers during the 90 days"N ^0*%%ZZ"  X4 x prior to the implementation of an area code overlay._ yOy' x ԍ Ameritech Opposition at 6; Bell Atlantic Opposition at 4; BellSouth Petition at 8; NYNEX Petition at 1112; SNET Opposition at 9; USTA Petition at 10. USTA states that area code relief planning  xcould be disrupted as a "single new carrier would be able to exercise a veto right over an overlay  X4 xplan by requesting a NXX in the existing area code 90 days prior to implementation;">`  yO'ԍ USTA Petition at 10.> NYNEX  x"and USTA note that a last minute cancellation of an area code overlay plan could undo months  xof work by numbering resource administrators and cause carriers to be unable to meet customer  X4 xrequests for new numbers.Ta yO 'ԍ NYNEX Petition at 12; USTA Petition at 10.T PTG contends that the "sheer and growing number of new entrants"  Xv4makes it impossible to implement the oneNXXcodepernewentrant requirement.RbBv@ yOg ' x ԍ PTG asserts that the California PUC has issued certificates of public convenience and necessity to seventyone  x new providers of local exchange service. PTG Opposition at 4. This number has increased in the interim since the  x^ record closed in this proceeding. The Telecommunications Division of the California Public Utilities Commission  xZ lists on its Web site certificated competitive local carriers (facilities) and certificated competitive local carriers  xU (resellers). The Division notes that companies may do business under more than one name, and therefore appear on  x a list more than once. As of 8/30/99, the list of certificated competitive local carriers (facilities) contained 99 names,  {O' x and, as of 8/26/99, the list of certificated competitive local carrier (resellers) contained 94 names. See  yO'<http://www.cpuc.ca.gov/telecommunications/lists.htm >, visited 9/8/99.R  XH4 e  25. ` ` NYNEX, GTE, the Pennsylvania Commission, and USTA request that the  X14 xCommission delete the one NXXcodepernewentrant requirement.c1J  yO,'ԍ GTE Opposition at 12; NYNEX Petition at 11; Pennsylvania Commission Petition at 5; USTA Petition at 9. USTA maintains that NXXs  xshould be assigned on a firstcome, firstserved basis as long as they are available in the old area  X 4 xcode, with no reference to a 90day time frame.?d  yO'ԍ USTA Opposition at 6.? AT&T and MFS suggest that we mandate  x=distribution of all of the remaining NXXs in the old area code when an overlay plan is  X 4 x implemented.Pe j yO'ԍ AT&T Petition at 9; MFS Petition at 9.P AirTouch and TCG recommend that each certified carrier have sufficient NXXs  xin the old area code to serve the entire geographic area covered by the code prior to  X 4 ximplementation of an area code overlay plan.[f  yOR!'ԍ AirTouch Opposition at 8; Teleport Petition at 7.[ BellSouth asserts that NXXs should be assigned  xonly to authorized facilitiesbased carriers that do not already have NXXs 90 days prior to  Xy4 xoverlay implementation.]gy yO$'ԍ BellSouth Petition at 8; BellSouth Opposition at 3.] Several parties assert that state commissions are best positioned to"yg0*%%ZZ"  X4 xyaddress local area code relief circumstances,h yOy'ԍ SNET Opposition at 89; Ohio PUC Opposition at 45; NYNEX Reply at 9; U S WEST Opposition at 13. but that the one NXXcodepernewentrant  xrequirement prevents state commissions from choosing an overlay as an area code relief plan  X4option if there are not enough NXXs available for distribution to new entrant carriers.iX yO'ԍ Ameritech Opposition at 6; NYNEX Petition at 12; Pennsylvania Commission Petition at 56.  X4 e  26. ` ` We continue to believe that the disproportionate allocation of NXXs between the  xyincumbent LECs and their competitors is a serious problem. Until recently, incumbent LECs  Xv4 xNacted as NXX Administrators,Gjv {O 'ԍ See supra  5.G and in that role they established the existing rate center  xconfigurations and assigned themselves NXXs in each rate center throughout each NPA in which  xthey provide local telephone service. Under current call rating mechanisms, all local exchange  xccarriers require at least one full NXX code (i.e., a block of 10,000 numbers) per rate center and  x4competing wireline service providers are assigned a full NXX for each rate center in the  X 4 xcgeographic area in which they establish service.mk z {O.'ԍ See Numbering Resource Optimization Notice at  112.m In many areas this rate center configuration  xcreates a shortage of NXX codes even if there remains a significant quantity of unassigned  xnumbers because an incumbent LEC or competing wireline service provider is assigned a full  xpNXX in order to serve customers in a particular rate center area, although the carrier or service  X 4 xprovider may only have a few customers requiring telephone numbers.3l  {Od'ԍ Id.3 Once an NXX code  xhas been assigned, the entity receiving the NXX manages the numbers available within the  Xy4 xNXX.Nmy {O'ԍ See CO Code Guidelines. N Thus, incumbent LECs retain the NXX codes that they previously assigned themselves  xand therefore have an abundance of available numbers in reserve from the older NXXs. We  XK4 x/concluded in the Local Competition Second Report and OrderxnK0  {O,'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19519  289.x that such "warehousing" of  X64 xNXXs gives incumbent LECs, the dominant providers of local exchange service,oF6  yO' x ԍ "Congress acknowledged that incumbent LECs . . . possess an approximate 99.7 percent share of the local  {Oq ' x| market as measured by revenues." Local Competition NPRM, 11 FCC Rcd at 14175,  6, citing Telecommunications  {O;!' xk Industry Revenue: TRS Fund Workshop Data, FCC Industry Analysis Division, Feb. 1996. LEC revenues in 1994  x were $98.4 billion, while total Competitive Access Provider (CAP) revenue was $287 million. Even though new  x| local telephone service competitors continue to grow at a rapid pace, their presence remains less than 5% of the local  x* market, as measured by total local service revenues. (FCC, Common Carrier Bureau, Industry Analysis Division,  {O]$'Local Competition (rel. Dec. 1998) at 1.  a competitive"6o0*%%ZZU"  xhadvantage over new entrants when an overlay is about to be introduced. In reaching this  xVconclusion, we did not mean to suggest that incumbent LECs have been unfair or partial in their  x&role as code administrators. We do, however, share petitioners' concerns that the disproportionate  xallocation of NXXs to incumbent LECs a logical result of their incumbency does give incumbent LECs an advantage over new entrants.  Xv4 e 27. ` ` Despite our ongoing concern over the advantages of incumbency, however, we also  xagree with the majority of parties commenting on this issue that the requirement of oneNXX x+codepernewentrant included in section 52.19(c)(3)(iii) of the Commission's rules does not  x significantly promote the interests of new entrants and competitive LECs seeking to compete with  xpincumbent LECs in local telecommunications markets. We further agree that the assignment of  xone NXX to each new entrant creates uncertainty in the area code relief planning process and  xmay actually spur the depletion of numbering resources. Therefore, we conclude that we should  xeliminate section 52.19(c)(3)(iii) of our rules, which provides that a state commission may choose  xto implement an allservice area code overlay plan only when the plan includes the assignment,  xduring the 90day period preceding the introduction of that overlay, of at least one NXX code  X4 x<to each new entrant.Jp yO 'ԍ 47 C.F.R.  52.19(c)(3)(iii).J Our modification to section 52.19 of our rules is contained in Appendix  Xy4B, infra.qyX yO' x ԍ In light of our decision to eliminate our one NXX per new entrant rule, BellSouth's request that the rule only apply to facilitiesbased carriers is moot.  XM' 4.` ` Mandatory 10Digit Dialing  X4 ` ` a. Background  X4 e 28. ` ` The Local Competition Second Report and Order requires that, when a state  xinitiates an area code overlay, that state also require 10digit dialing for every telephone call  X4 xwithin and between all area codes in the geographic area covered by the overlay area code.r {O'' x ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19518  286; see also 47 C.F.R.  52.19(c)(3)(ii).  xThe Commission reasoned that requiring 10digit dialing for all calls would minimize dialing  xdisparity between telephone customers using the old area code and customers using the new area  X4 xcode and thus ensure that the introduction of the overlay would not deter competition.@s  {O<"'ԍ Id. at  287.@ Absent  x10digit dialing, telephone customers using the old area code would dial seven digits to call others  xwith numbers in that area code, but users within the new overlay area code would have to dial 10 digits to reach customers in the old area code. "<s0*%%ZZl"Ԍ X4ԙ ` ` b. Discussion  X4 e 29. ` ` Bell Atlantic, Jubon, NYNEX, the NYDPS, and the Pennsylvania Commission all  xfiled petitions requesting that the Commission either rescind or modify the mandatory 10digit  xlocal dialing requirement for all customers between and within area codes in the area covered by  X4 xIthe new code.t yO' x@ ԍ Bell Atlantic Opposition at 3; Jubon Engineering Petition at 5; NYDPS Petition at 9; NYNEX Petition at 11; Pennsylvania Commission Petition at 5. Further, on January 9, 1998, the NYDPS filed a petition for waiver of the 10 Xw4 xdigit dialing rule for two NPAs to be implemented in New York City.8u"w  yOH ' xR ԍ New York State Department of Public Service Petition for Expedited Waiver of 47 C.F.R. Section  xk 52.19(c)(3)(ii). The Petition sought a permanent waiver of this rule on the bases that competition already exists in  x! New York and thus 10digit dialing would not effect competition; number portability ameliorates the anticompetitive  {O 'effects of dialing disparities; and the requirement would unduly inconvenience callers in the New York City. Id.8 On July 20, 1998, the  xCommon Carrier Bureau, on delegated authority, denied the NYDPS request for a permanent  x4waiver, but extended the period during which 10digit dialing could be accomplished on a  X24permissive basis.vH2  yO' x ԍ New York Department of Public Service Petition for Expedited Waiver of 47 C.F.R. Section 52.19(c)(3)(ii),  {O' xZ Order, NSD File No. L9803, DA 981434, 13 FCC Rcd 13491 (1998) (July 20 New York Order). On November  xQ 6, 1998, the NYDPS requested that this date be extended until January 15, 2000, to provide for necessary network  {OG' xx upgrades and consumer education. See Letter from Lawrence G. Malone, NYDPS, to Lawrence E. Strickling, FCC,  x dated November 6, 1998. On December 4, 1998, the Bureau extended this permissive dialing period to April 15,  x 2000 in response to the NYDPS request. New York Department of Public Service Petition for Expedited Waiver  {O' x of 47 C.F.R. Section 52.19(c)(3)(ii), Order, NSD File No. L9803, DA 982310 (adopted December 4, 1998)  {Ok'(December 4 New York Order).  X 4 e r30. ` ` On August 17, 1998, the NYDPS filed an application to the Commission for  X 4 xZreview of the July 20 New York Order.w  yO' xD ԍ New York State Department of Public Service Petition for Expedited Waiver, filed August 17, 1998 (NYDPS Review Petition). On that same date, the NYDPS filed a petition to stay  X 4 xboth the July 20 New York Order as well as the 10digit dialing requirement of the Local  X 4 x3Competition Second Report and Order for a period of seven months following the completion of  X 4 xjudicial review of the orders.x r yO' x ԍ New York State Department of Public Service Petition for Stay, filed August 17, 1998 (NYDPS Stay Petition). Subsequently, on March 15, 1999, the NYDPS filed a petition  xfor a writ of mandamus with the United States Court of Appeals for the Second Circuit, directing  xthe Commission to act on the NYDPS petition for reconsideration of the 10digit dialing rule as  Xi4 xset forth in the Local Competition Second Report and Order as well as the NYDPS application  XT4 x3for review of the Bureau's denial of the July 20 New York Order. On that day, the NYDPS also  x+filed a motion with the Second Circuit for stay of the Commission's 10digit dialing rule. On"?x0*%%ZZ"  x<March 26, 1999, the Second Circuit granted the NYDPS motion for a stay of the Commission's  xV10digit dialing rule in the State of New York until one year after the FCC rules on the NYDPS  xVpetition for reconsideration of the 10digit dialing rule and on the NYDPS application for review  X4 xof the July 20 New York Order, or until the Second Circuit rules on the NYDPS petition for Writ  X4of Mandamus.y {O' xQ ԍ People of the State of New York and Public Service Commission of the State of New York v. FCC and the  {O'United States of America, No. 993015, slip op. at 1 (2d Cir. March 26, 1999) (order granting stay).  Xx4 e 31.` ` In its filings before the Commission, the NYDPS contends that, under section  Xa4 xI2(b)Bza$ yO6 'ԍ 47 U.S.C.  152(b). B of the Act, jurisdiction over dialing patterns for intrastate calls remains with the states|{a yO 'ԍ NYDPS Petition at 45; NYDPS Stay Petition at 912; NYDPS Review Petition at 47. |  xand that the Commission's 10digit dialing requirement is "tantamount to preempting the states  X34 xwith regard to dialing parity for intrastate calls."y|3D yO('ԍ NYDPS Petition at 3; NYDPS Stay Petition at 67; NYDPS Review Petition at 34. y NYDPS also argues that the Commission has  x}not met the Supreme Court's standard for preemption of an activity traditionally regulated by the  x~states. In addition, the NYDPS asserts that our jurisdiction with respect to numbering  x_administration is limited to the "coordination and distribution" of telephone numbers under the  X 4 xNANP.}  {O\' x ԍ NYDPS Supplemental Petition at 8 (citing People of the State of California v. FCC, 124 F.3d 934 (8th Cir.  {O&'1997)). See also NYDPS Stay Petition at 8; NYDPS Review Petition at 3. Several other parties also contend that because state commissions are best positioned  xVto evaluate local conditions and make determinations as to whether 10digit dialing is necessary,  X 4 xthe Commission should not impose an inflexible 10digit dialing requirement.~ 0  yO'ԍ NYNEX Petition at 13; Bell Atlantic Opposition at 3; Pennsylvania Commission Petition at 2. In addition,  xNYDPS contends that the 10digit dialing mandate will force carriers to invest in more switching  xequipment to handle the additional holding time occasioned by dialing 10 instead of 7 digits and  Xd4 x<unnecessarily burden consumers with dialing additional digits when placing local calls.>d  yO'ԍ NYDPS Petition at 8.> Jubon  x}argues that service providers will be forced to supply an informational announcement noting that  x4the call was incorrectly dialed and be forced to supply additional telephone central office  X4 x&equipment, call processing, and message handling capacity without receiving additional revenue.JP  yO "'ԍ Jubon Engineering Petition at 7.J  xNYNEX and the Pennsylvania Commission assert that 7digit local dialing for intraNPA calls  xand 10digit dialing for interNPA calls would be easier and less confusing to customers because"0*%%ZZ"  X4 xit would be less disruptive of local dialing patterns.p {Oy'ԍ NYNEX Petition at 13; see Pennsylvania Commission Petition at 4.p Jubon suggests that the Commission  xpmandate or permit 11digit local dialing with a "1" + 10 digit format because the public is already  X4 xlfamiliar with the "1" + 10 digit toll dialing concept for long distance numbers.LZ yO'ԍ Jubon Engineering Petition at 45.L MFS argues  xthat some customers continue to believe that calls to an overlay area code are long distance calls,  xZand this belief creates a disparity between the perceived value of the old area code versus the new  X4overlay area code.< yO( 'ԍ MFS Petition at 6.<  X_4 e 932. ` ` The NYDPS also requests that we consider changing the existing numbering plan  x<and that we formally investigate changes to the numbering plan that would, in general, minimize  X14 xthe number of digits customers must dial to place calls.?1z yO\'ԍ NYDPS Petition at 11.? The NYDPS states that the feasibility  xcof 8digit telephone numbers (which would increase the supply of numbers) should be examined  X 4 x/thoroughly before 10digit dialing is mandated for local calls.3  {O'ԍ Id.3 In contrast, MFS contends that  xmandatory 10digit dialing does not adequately address the anticompetitive effects of overlays but  xnotes that the Commission should maintain the 10digit dialing requirement if it continues to  X 4 xpermit overlays.@  yO 'ԍ MFS Opposition at 78.@ AirTouch, MCI, and TCG argue that the elimination of mandatory 10digit  xdialing would impede competition because potential customers would be reluctant to subscribe  xto the services of a competitive LEC or new entrant service provider as they would mostly have  xnumbers available to offer customers from the overlay area code while an incumbent LEC would  Xb4 xhave more numbers available to offer customers in the old area code.kb,  yO?'ԍ AirTouch Reply at 3; MCI Opposition at 3; TCG Opposition at 910.k AirTouch states that  xIincumbent LECs will be able to assign more numbers from the old area code to customers "due  xto the large supply of numbers they have been able to stockpile as the result of temporary  X4 xEshelving of returned telephone numbers."D  yO 'ԍ AirTouch Reply at 3.D Several petitioners note that, if the Commission  xlcontinues to allow the implementation of area code overlays, then it should retain the 10digit  xdialing requirement because it eliminates local dialing disparity and helps to ensure competitive"L 0*%%ZZ"  X4 xneutrality. {Oy' x ԍ AT&T Opposition at 1516; see Cox Opposition at 2; MCI Opposition at 3; MFS Opposition at 78; Sprint Opposition at 8; TCG Opposition at 810; U S WEST Opposition at 12. AirTouch, MCI, and Teleport assert that incumbent LEC customers, most of whom  xwould have numbers in the old area code, would only have to dial 7 digits to call others with  xnumbers in the old area code while customers subscribing to the competitive LEC or new entrant  xservice provider, most of whom would more likely have numbers assigned in the new overlay  X4 xIarea code, would have to dial 10 digits to place calls to reach customers in the old area code.`" {Ow'ԍ Id. at 3; MCI Opposition at 3; TCG Reply at 11. `  xAirTouch notes that wireless carriers typically have a higher fill factor per NXX code (over 90%)  xthan do incumbent LECs (approximately 50%); thus, wireless customers will bear a  X_4disproportionate burden of 10digit dialing.>_ yO 'ԍ AirTouch Reply at 3.>  X14 e ( 33. ` ` The Pennsylvania Commission and the NYDPS point to interim and longterm  x"number portability as an alternative solution to mitigating the potential dialing disparity problems  x between customers in the old and new area codes that the Commission's 10digit dialing  X 4 xrequirement seeks to address.j D yO'ԍ NYDPS Petition at 78; Pennsylvania Commission Petition at 45. j The Pennsylvania Commission states that number portability  x<undermines the FCC's assumption that customers would find it less attractive to switch carriers  xbecause competing exchange service providers would have to assign their customers numbers in  xtthe new overlay area codes because incumbent LEC customers could switch to a competitive LEC  X4 xand still retain their 7digit telephone number.P yO'ԍ Pennsylvania Commission Petition at 5.P Thus, the Pennsylvania Commission requests  x_that the Commission "make an exception to the mandatory 10digit dialing requirement when  Xb4 xlongterm number portability becomes available."9bd  {Ow'ԍ Id. at 5.9 Further, NYDPS and NYNEX argue that  xthe assumption that all of the competing carriers will be relegated to supplying numbers in the  xoverlay code is erroneous because competitive LECs and other competing carriers will have a  xsignificant number of NXX codes assigned to them in existing area codes and thus will be able  X4to assign telephone numbers to their customers from the old area codes.W  yO 'ԍ NYDPS Petition at 7; NYNEX Petition at 1314.W  X4 e !34. ` ` Both NYNEX and the NYDPS request that the Commission clarify that it does not  x+intend to apply retroactively the mandatory 10digit local dialing requirement to the 917 area" 0*%%ZZ"  X4 xlcode overlay implemented in New York City during 1992.Y yOy'ԍ NYDPS Petition at 9, n.1; NYNEX Petition at 14.Y The 917 overlay plan currently  xallows 7digit dialing within the same NPA and 1+10 digit dialing among the three NPAs in New  X4 xYork City, 212, 718, and 917.?X yO'ԍ NYNEX Petition at 14.? Although Cox does not oppose the requests by NYNEX and  xNYDPS that the mandatory 10digit local dialing requirement be applied to prospective overlay  x}plans only, Cox notes that the 917 overlay should not serve as a model of an allservices overlay  xIplan successfully implemented without the 10digit dialing requirement, because the 917 overlay  xEis not an allservices overlay, was not introduced in a competitive market and is not used for  X_4regular residential and business telephone lines.?_ yO 'ԍ Cox Opposition at 34?  X14 e F "35. ` ` We deny petitioners' requests for reconsideration of our rule that allservices area  xcode overlay plans include mandatory 10digit dialing. We also deny the NYDPS application for  X 4 xreview of the July 20 New York Order. x yO,'ԍ The NYDPS request for a stay is moot in light of the Second Circuit's March 26 stay order. We reaffirm that such overlay plans must include 10 X 4 x}digit dialing for all local calls between and within area codes in the area served by an overlay.Ed  yO' x ԍ The New York City 917 overlay area code permits 7digit dialing within an NPA and thus, does not meet  x our 10digit local dialing requirement for implementation of an overlay. We, however, do not apply the mandatory  x 10digit local dialing requirement to the 917 area code overlay because its 1992 implementation preceded the  x adoption of rule 52.19(c)(ii), which became effective October 6, 1996. We also note that on August 10, 1999, the  x Illinois Commerce Commission petitioned the Commission for a temporary waiver of the rules requiring 10digit  x7 dialing in overlay areas. The Illinois Commission states that it is implementing several overlay area codes within  x the next 18 months, and argues that a waiver is justified because requiring 10digit dialing in a "piecemeal fashion"  xk as each overlay is implemented will exacerbate customer confusion and deny the Illinois Commission and carriers  xo time to develop and administer a comprehensive customer education program. Comments in response to the petition  {O' x were due on September 16, 1999. Reply comments are due on September 30, 1999. See Common Carrier Bureau  xZ Seeks Comment on the Illinois Commerce Commission's Petition for Expedited Temporary Waiver of 47 C.F.R.  {OA'52.19(c)(3)(ii), Public Notice, NSD File No. L9965, DA 991631 (rel. August 16, 1999).E  x We emphasize, however, that states are authorized to continue overseeing the introduction of new  X 4 xarea codes insofar as they are consistent with our numbering administration guidelines.x 4 {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19512  272.x In our  X 4 x&Local Competition Second Report and Order, we clarified the Ameritech Order  yO "' x ԍ Proposed 708 Relief Plan and 630 Numbering Plan Area Code by AmeritechIllinois, IAD File No. 94102,  {O"'Declaratory Ruling and Order, 10 FCC Rcd 4596 (Ameritech Order). by explicitly  xprohibiting servicespecific or technologyspecific area code overlays and instituted two  xconditions that a state must include in any area code overlay plan: 10digit local dialing and the"} 0*%%ZZ"  X4 xallocation of one NXX per carrier. yOy' x ԍ We rescind the requirement of one NXX code per new entrant in section 52.19(c)(3)(iii) of the Commission's  {OA'rules. See supra  2227.  We adopted a mandatory 10digit local dialing requirement  xto ensure that local dialing disparity does not deter competition in the local telecommunications  x/marketplace. We explained that in an overlay situation, competing exchange service providers,  xlmost of which would be new entrants to the market, would have to assign to their customers  xnumbers in the new area code while incumbent LECs would be able to assign to their customers  xnumbers in the old area code. Thus, competitive LECs' customers in the new overlay code  x_would have to dial 10 digits much more often than the incumbent LECs' customers in the old  X_4area code, thereby making it less attractive for customers to switch to competitive LECs._" {O2 'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1951819  287.  X14 e #36. ` ` We disagree with the NYDPS assertions that the Commission's authority to impose  xmandatory 10digit local dialing as a condition for the implementation of an area code overlay  X 4 xis limited by section 2(b) of the Act,@  yOh'ԍ 47 U.S.C.  152(b).@ that the Commission has not met the Supreme Court's  xstandard for preemption of an activity traditionally regulated by the states, and that the 10digit  xdialing requirement is not the type of activity envisioned as a function of numbering  X 4 xadministration.M D yO'ԍ NYDPS Supplemental Petition at 78.M In Louisiana Public Service Commission v. FCC,  {OC'ԍ Louisiana Public Service Comm'n v. FCC, 476 U.S. 355 (1986) (Louisiana PSC).Ă the Supreme Court decided  xIthat, to overcome section 2(b)'s limits on the Commission's jurisdiction with respect to intrastate  x+communications service, Congress must either modify section 2(b) or grant the Commission  X{4 x additional authority.^{f  {O'ԍ See Louisiana PSC, 476 U.S. at 368369. ^ In section 251(e)(1) of the Act, Congress explicitly granted such  xladditional authority to the Commission when it mandated that the Commission has "exclusive  x/jurisdiction over those portions of the North American Numbering Plan (NANP) that pertain to  X64 xuthe United States."J   6  yO' x ԍ 47 U.S.C.  251(e)(1). We also disagree with the NYDPS that section 2(b) deprives the Commission of  x; jurisdiction under section 251(e)(1) of the Act over intrastate dialing patterns and is limited to "the coordination and  x distribution of all telephone numbers in the United States." The NYDPS relies on a misreading of the Eighth  {O7!' x7 Circuit's ruling in California v. FCC, 124 F.3d 934 (8th Cir. 1997). A plain reading of California v. FCC indicates  xU that the case has no application to the issue of the Commission's jurisdiction over intrastate dialing patterns. In that  {O"' xt portion of California devoted to numbering administration, the Eighth Circuit declined to rule on whether the  x. methodology that the Commission adopted for cost recovery of the administration of the NANP was "competitively  x neutral," as required by the Act. The court held that the issue was not ripe for review. 124 F.3d at 944. In the  x introductory section to this part of the Order, the court stated that "[n]umbering administration involves the"#%0*%%%"  x coordination and distribution of all telephone numbers in the United States." The Eighth Circuit made no reference  x; to Commission jurisdiction pursuant to section 251(e)(1), let alone rendered a decision limiting that jurisdiction. The  x NYDPS argument is an attempt to bootstrap a remark made in dicta in a decision completely irrelevant to this issue  xg into an Eighth Circuit ruling limiting the numbering administration jurisdiction of the Commission. Even if the  xx Eighth Circuit's language had some relevance to the Commission's jurisdiction over intrastate dialing patterns, by  {Ox' x using the word involves, the Eighth Circuit merely indicates that it regards the coordination and distribution of all  {OB' x telephone numbers as "included as a necessary circumstance" of the administration of the NANP (see Random House  x Dictionary of the English Language (College Edition 1968)), not as the defining limit of the activities over which  x the Commission had jurisdiction. Finally, any validity that the NYDPS argument that section 2(b) precludes  x Commission jurisdiction over all aspects of numbering administration has been discredited by the Supreme Court's  {Od ' x recent holding in AT&T Corp. v. Iowa Utilities Bd., 119 S. Ct. 721 (1999) that FCC jurisdiction "always follows  {O. ' x where the Act applies." Id. at 731. Thus, the NYDPS argument that the Commission's exclusive jurisdiction over numbering administration does not extend to intrastate dialing patterns is unsupported by the statute, industry practice and case law.J In the NANP Order, the Commission noted that access to national"6 0*%%ZZ"  xnumbering resources is essential to entities desiring to participate in the telecommunications  xEindustry; it pointed out the linkage between central office code availability and the growth of  xcompetition in the LECs' core businesses; and it concluded that the functions associated with  xNPA code administration should be centralized and transferred from the LECs to a NANP  X4 xAdministrator.f  {O'ԍ NANP Order, 11 FCC Rcd at 262021  77.f Section 2(b) thus imposes no limitation upon the Commission's exclusive  X4authority under section 251(e) to perform ongoing numbering administration functions.& {OX' x ԍ In the Local Competition Second Report and Order the Commission stated that states must act consistently  x with federal numbering guidelines concerning area code relief designed to ensure the fair and timely availability of  {O' xH numbering resources to all telecommunications carriers.  Local Competition Second Report and Order, 11 FCC Rcd  {O'at 1951617  281.  X_4 e ,$37. ` ` Further, the NYDPS's attempt to characterize this issue as a "dialing parity" issue  xunder section 251(b)(3) is based on an erroneous reading of the Act. "Dialing parity" is a defined  X14 xterm in the Act,A1 yO'ԍ 47 U.S.C.  153(15).A that requires that a customer be able to access the carrier of his or her choice  xIwithout having to uses any access codes. Although the Commission, in its discussion of the 10 xdigit dialing rule, refers to the dialing "disparity" that would occur absent the rule, the  xCommission's decision to require 10digit dialing has nothing to do with "access codes," and  xnowhere is based on section 251(b)(3) of the Act. Rather, the Commission's rule is grounded  xin its exclusive jurisdiction over the administration of the North American Numbering Plan as granted by section 251(e)(1) of the Act. "0*%%ZZE"Ԍ X4 e %38. ` ` In addition, the Ameritech Order, which preceded the enactment of section 251(e),  X4 xconcluded that the Commission may preempt state actions concerning the NANP.b {Od'ԍ Ameritech Order, 10 FCC Rcd at 4602  14.b Section  x251(e)(1) clearly augments this authority. Although the Commission has exclusive jurisdiction  X4 xVover numbering administration issues, the Commission stated in the Local Competition Second  X4 xReport and Order that state commissions were uniquely situated to determine what type of area  X4 xcode relief best accommodates local circumstances~Z {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19517  283.~ and authorized states to resolve matters  xinvolving the implementation of new area codes, subject to Commission guidelines for numbering  Xe4 xadministration.Le {O 'ԍ Id. at 19516  281.L The Commission retains authority to set policy with respect to all facets of  XN4numbering administration in the United States.LN~ {O}'ԍ Id. at 19512  271.L  X 4 e &39. ` ` We agree with AT&T, MCI, Sprint, TCG, and U S WEST that confusion  xregarding the dialing of toll versus local calls quickly dissipates as consumers become accustomed  x<to local 10digit dialing. We reject, however, Jubon's proposal that we adopt 1 + 10digit dialing  xfor local numbers. The public interest is wellserved by a uniform dialing pattern, such as 10 x=digit dialing for all local calls and 1 + 10 digits for all long distance calls, which clearly  xdifferentiates between local and toll calls. We also decline to consider the NYDPS 8digit  xtelephone number plan in this proceeding, as the NPANXXXXXX structure for telephone  X4 xnumbers was not an issue raised in either the Local Competition NPRM or the Local Competition  Xj4 xSecond Report and Order and thus, comment was not solicited on that issue. In addition, we  xreject the contentions of NYDPS and Jubon that we should abandon the 10digit dialing  xrequirement because it will force carriers to invest in more switching equipment to handle  xadditional holding time occasioned by dialing 10 instead of 7 digits and informational  xpannouncements. Parties have presented no information to support their contentions. Moreover,  xas we balance the public interest served by procompetitive policies in the telecommunications  xmarketplace against any costs that carriers may incur, such as costs of consumer education or  x}modest incremental additions to switching equipment, we believe that the public generally is best  x8served by our rule requiring that all carriers' customers employ similar dialing patterns when making local calls.  Xo4 e '40. ` ` Further, we do not agree with claims made by the Pennsylvania Commission and  x"NYDPS that interim and longterm number portability will reduce the competitive disparity that  XA4 x4the Commission's mandatory 10digit dialing requirement seeks to address. In the Local  X,4 xCompetition Second Report and Order, the Commission required mandatory 10digit dialing for",0*%%ZZ<"  x[all local calls in areas served by overlays to minimize any local dialing disparity that could  X4 xIotherwise deter competition.~ {Ob'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19518  286.~ We explained that competing local exchange service providers,  xmost of which would be new entrants to the market, would have to assign numbers in the new  x/area code to their customers while incumbent LECs would be able to assign numbers in the old  X4 xgarea code to their customers.LZ {O'ԍ Id. at 19519  289.L The Bureau recently rejected a Pennsylvania Commission petition  X4 xfor waiver of the 10digit dialing requirement.t\ yO* ' x ԍ Pennsylvania Public Utility Commission Petition for Expedited Waiver of 47 C.F.R. Section 52.19 for Area  {O ' xy Code 412 Relief, CC Docket No. 9698, Order, 12 FCC Rcd 3783, 379293  1719 (1997) (Pennsylvania  {O 'Commission Waiver Order).t The Bureau concluded that although interim  xand longterm number portability will allow an incumbent LEC customer to retain its telephone  xnumbers, including the area code, if that customer switches to a competitive LEC, number  xportability does not ameliorate the dialing disparity that would exist between the old area code  X14 xand the new area code sufficiently to justify the elimination of the 10digit dialing requirement.E1 {O'ԍ Id. at  18.E  X 4 xFor example, most new numbers would likely be assigned from the overlay. Thus, the Bureau  xfound that new customers in the area and existing customers who obtain additional lines would  xlnot "port" numbers from the old NPA. Because the incumbent would be likely to have more  xhnumbers in the old NPA than competitive LECs, it would be better able to assure its new  x_customers the convenience of 7-digit dialing for the majority of their local calls. The Bureau  x&acknowledged that competitive LECs would have NXXs in some rate centers in the old NPA, and  xconsequently may be able to assign numbers in that NPA to some customers, but concluded that,  x"overall, it is more likely that the incumbent LEC will be able to assign a number in the old NPA  xcbecause the incumbent LEC will have more NXX numbers in more rate centers in the old NPA  xVthan competitive LECs would have. As a consequence, the Bureau concluded that for the new  xccustomers' lines and the existing customers' second lines in the new NPA, there would continue  X4 xto be a dialing disparity.E {Op'ԍ Id. at  19.E We agree with the Bureau, and conclude that, in the absence of  xmandatory 10-digit dialing, a customer could find it less attractive to obtain service from a  xcompetitive LEC solely because the incumbent LEC would have access to a larger pool of NXXs in the old NPA.  X4 e (41. ` ` We note that long term number portability is substantially deployed in the top 100  xVMSAs, thus minimizing the current relevance of interim number portability to our 10digit dialing  X|4 xrule. We agree with the Bureau's conclusion in the Pennsylvania Commission Waiver Order that  xwithout the 10digit dialing requirement, technical drawbacks inherent in implementing interim"g4 0*%%ZZ"  xnumber portability prevent interim number portability from overcoming the anticompetitive  X4 x"effects of an area code overlay.3 {Ob'ԍ Id.3 The remote call forwarding (RCF) service used to achieve  xinterim number portability creates a slight dialing delay for customers as their calls are forwarded  X4 x&from the old number to the new number.3Z {O'ԍ Id.3 In the Number Portability Order, we also found that  xthe current, technically feasible methods of providing number portability, such as RCF, have other  X4 x"significant limitations.~ {O, 'ԍ Number Portability Order, 11 FCC Rcd at 840910  110111. ~ For example, customers that obtain interim number portability through  Xx4 x=RCF lose caller ID and certain other local area signalling services.qx~ {O 'ԍ Pennsylvania Commission Waiver Order, 12 FCC Rcd at 3793  18.q In addition, the  Xa4 xtransmission quality of calls for customers using RCF is sometimes degraded.3a {O"'ԍ Id.3 For these  xreasons, even though interim number portability allows a caller to retain his or her 7digit number  xwhen the caller changes carriers, it does not create a level playing field between incumbent LECs  X 4 xand competitive LECs,3  {Oo'ԍ Id.3 nor does it alleviate local dialing disparity between the old area code and the new overlay area code.  X 4 e )42. ` ` Moreover, the Commission recognized in the Local Competition Second Report  X 4 xand Order that longterm number portability would "reduce the anticompetitive impact of  X 4 xoverlays"P 4  {O'ԍ Id. at 3793  19.P but would not obviate the need for mandatory 10digit dialing.3  {O$'ԍ Id.3 Although it will  xallow customers to change service providers without the service and technical limitations of  xinterim number portability, longterm number portability does not overcome the dialing disparity  Xh4 xthat would exist between the old NPA and the new NPA.3hX  {Oq'ԍ Id.3 When an area code overlay is first  XQ4 xpimplemented, the majority of customers will be in the old area code.xQ {O!'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19519  287.x If the customers located  xin the old area code were to enjoy the convenience of dialing only 7 digits to contact one another  xand had to dial 10 digits to contact customers in the new area code, telephone numbers in the old  xarea code would be more desirable. New customers are likely to seek the same convenience by" |0*%%ZZ]"  x/requesting numbers from the old area code. Further, because the Commision has extended the  xdate by which CMRS providers must implement long term number portability until November  X4 x24, 2002,# {OK' x ԍ CMRS LNP Forbearance Order, (forbearing from requiring CMRS providers to supply service provider  {O'number portability in the top 100 Metropolitan Statistical Areas until November 24, 2002), supra n.80.# wireless customers would not enjoy even the limited benefit that long term number portability offers.  X4 e 9*43. ` ` NYDPS and NYNEX assert that competitive LECs and other competing carriers  xhave a significant number of NXX codes assigned to them in existing area codes and thus will  xIbe able to assign telephone numbers to their customers from the old area code. This claim fails  xVto take into account the current system of distributing NXXs in association with geographic rate  xcenters. Some states require that wireline competitive LECs use the incumbent LEC rate plans,  xpwhich require that a competitive LEC receive an NXX from each rate center that a competitive  xpLEC wishes to serve. The incumbent LEC is likely to have NXXs in each rate center, whereas  xindividual competitive LECs or other service providers may only have NXXs in a few rate  xcenters. Consequently the competitive LECs and other entities may only be able to serve  xcustomers in limited geographic areas within the old area code or else they will need additional  xNXXs thereby creating increasing requests for NXXs in the old area code. Moreover, it is likely  xtthat some carriers or telephone exchange service providers may be new entrants to the market and  xIhave no NXXs in the old area code. Thus, as competitive LECs and new entrants expand their  xservice areas or begin to offer services, they will have to obtain NXXs from the overlay area  xcode. Without mandatory 10digit dialing between and within area codes, dialing disparity  xbetween incumbent LECs and competitive LECs will exist and pressure for the scarce numbering resources will push area codes into jeopardy at a faster rate.  X4 e +44.` ` Further, in the Numbering Resource Optimization Notice, the Commission  x}recognized that North American Numbering Council (NANC) had identified mandatory, 10digit  X4 xdialing as a means of improving the use of assigned area codes.q$ {O'ԍ See Numbering Resource Optimization Notice at  122125.q According to the Numbering  X4 xResource Optimization Notice, the NANC reported that 10digit dialing would eliminate unused,  X4 xor "protected," central office codes,= {O'ԍ Id.  123.= and could also increase the number of central office codes  X4 x<available in an area code by allowing central office codes to begin with a zero or a one.3H {O{!'ԍ Id.3 The  xCommission also reported that the NANC concluded that the adoption of 10digit dialing might  XT4 xeliminate disincentives for states to adopt area code overlays.3T {O$'ԍ Id.3 In the Numbering Resource"T l 0*%%ZZ"  X4 xOptimization Notice, the Commission seeks comment on whether it should adopt nationwide ten X4 xdigit dialing, or whether we should encourage states to implement tendigit dialing as a priority.@ {Od'ԍ Id. at  126.@  xAlthough 10digit dialing as a number optimization measure is not an issue in the instant record,  xwe believe that absent a significant legal or policy reason for revising the 10digit dialing rule,  x8we should not place an unnecessary obstacle to potential number use optimization measures  xcurrently under consideration by the industry, state commissions, consumer groups, and this Commission.  XJ4 e \,45. ` ` In affirming the 10digit dialing rule, we also find that the NYDPS has failed to  xlshow that the Commission should grant the NYDPS Application for Review of the Common  X 4 xCarrier Bureau's July 20 New York Order. Our rules of practice specify that one of five criteria  X 4 x3must be met to warrant Commission review of any action taken pursuant to delegated authority.V Z {O'ԍ See 47 C.F.R.  1.115(b)(2)(i)(v).V  xtThe NYDPS's argument appears to depend on two of these enumerated factors: (1) that the action  xtaken by the Bureau pursuant to delegated authority was in conflict with statute, regulation, case  X 4 xprecedent, or established Commission policy;H  yO_'ԍ 47 C.F.R.  1.115(b)(2)(i).H and (2) that the action involved application of  X 4 x_precedent or policy which should be overturned or revised.J | yO'ԍ 47 C.F.R.  1.115(b)(2)(iii).J Regarding the first factor, the  x/NYDPS argues that the Bureau's order conflicts with the Act's purported preservation of state  X}4 xjurisdiction over intrastate communications.E}  yO:'ԍ NYDPS Review Petition at 8.E As we noted in paragraph 35, supra, in the Local  Xh4 xCompetition Order, this Commission concluded that section 251(e)(1) of the Act confers  xjurisdiction to this Commission over all facets of administration of the NANP, including the  xestablishment of dialing patterns. The NYDPS also argues that the Eighth Circuit, by vacating  x"our intrastate dialing parity rules, precludes our authority over intrastate dialing patterns as they  x&apply to the administration of the NANP. This argument has been rendered moot by the Supreme  xCourt's decision reversing the Eighth's Circuit's vacation of the Commission's dialing parity  X4 xrules.j {O- 'ԍ See AT&T v. Iowa Utils. Bd., 119 S. Ct. 721 (1999).j Further, even if this argument had some validity, as we discuss in paragraph 36, supra,  xthe NYDPS attempt to characterize the 10digit dialing rule as a "dialing parity" issue under  X4 xVsection 251(b)(3) is based on an erroneous reading of the Act. Thus, the Bureau's denial of the  xNYDPS Petition for Waiver was entirely consistent with the Act, our regulations, precedent and  xpolicy. Regarding the second factor, the NYDPS argues that we should overturn our 10digit  xdialing rule. Our reasons for denying this request are fully set forth above in our discussion of"o!. 0*%%ZZ"  xthe NYDPS petition for reconsideration of the 10digit dialing rule. We thus deny the NYDPS Application for Review.  X' 5.` ` 10digit Dialing for National 555 Numbers  X4 ` ` a. Background  X`4 e -46. ` ` In the Local Competition Second Report and Order, the Commission's  xrequirement that there be mandatory 10digit dialing between and within the area codes affected  X44 xby the overlay made no special provision for national 555 numbers.4 {O ' xM ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19518  287. Section 52.19(c)(3)(ii) of our  x rules, 47 C.F.R.  52.19(c)(3)(ii), specifically states that there must be 10digit dialing within and between (rather  x than among) all area codes in the geographic area covered by the overlay area code. Industry guidelines do  xb contemplate a "multiple overlay," in which a new NPA would be assigned to overlay multiple existing NPAs needing  {O ' x relief. NPA Code Relief Planning & Notification Guidelines (INC 970404016), at  6.3.4 (reissued January 27, 1999). Both Pennsylvania and Texas have instituted multiple overlays. A 555 number is a unique  xline number in the 555 NXX assigned to a particular entity, and is used to reach a wide variety  X 4 xof information services. D yO' x ԍ The most commonly recognized example of a 555 number is that used for directory assistance information (5551212). 555 numbers are assigned according to guidelines developed by the  X 4 xATIS-sponsored Industry Numbering Committee (INC).  {O<'ԍ 555 NXX Assignment Guidelines, INC 94-0429-002555 (April 19, 1996) (555 NXX Assignment Guidelines). 555 numbers may be assigned for  xReither national or local use. Under the INC guidelines, a 555 number will be designated as a  xpnational number if it is to be used in at least 30% of all NPAs, states, or provinces in the NANP  X 4 xIarea, and cannot be assigned to more than one entity.^ .  {O'ԍ See 555 NXX Assignment Guidelines,  3.1.1.^ Nonnational 555 numbers differ from  x<national 555 numbers in that they are assigned to an entity for use in a specific geographic area  xor areas, and may be assigned to multiple entities, assuming those entities wish to use the non Xe4 xnational number in different geographic NPAs.Ae  {O'ԍ Id.,  3.1.2. A As of September, 1998, over 2,487 national  XN4and 381 local 555 numbers had been assigned by the NANPA.KNR  {OQ 'ԍ See .K "7"0*%%ZZ;"Ԍ X4 ` ` b. Discussion  X4 ".47. WP requests that we clarify whether ten digits must be dialed to complete calls to  X4 xnational 555 numbers in areas served by overlay area codes.; yO5'ԍ WP Petition at 1.; WP states that it has been  xyworking with this Commission, the public service commissions of Maryland, Virginia, and the  xcDistrict of Columbia, and with Bell Atlantic to develop a service that would allow WP and other  x/information service providers to offer lowcost, local information services over the telephone to  x4consumers, initially in the District of Columbia metropolitan area and then throughout the  XI4 xnation.9IX {OR 'ԍ Id. at 2.9 WP states that ensuring that customers are able to gain access to this service via a  xtelephone number that is easy to remember, easy to use, and provides uniform dialing on a  x~regional or national basis is critical to the success of WP's (and other like) information  X 4 xservices.3  {O'ԍ Id.3 According to WP, the principal value of national 555 numbers is the ease of recall  X 4and access that accompanies the ability to complete nationwide calls by dialing seven digits.P | {O' xt ԍ Id. at 3. Communications Venture Services, Inc. (CVS) supported WP's petition, and also requested the  x; Commission to recognize that national 555 numbers may be dialed with seven digits. CVS alleges that 7digit dialing  x for 555 numbers is technically easier to implement than 10digit dialing, and that there is a public need for 7digit  x dialed access and exchange services, particularly for older callers and persons with impaired short term memory. CVS Opposition at 2.P  X 4 "/48. WP contends that the 10digit dialing requirement for area code overlays should not  X 4 xapply to national 555 numbers.9 .  {O'ԍ Id. at 4.9 The development of lowcost information services is in the  xpublic interest, WP argues, and enforcement of the 10digit dialing requirement would undermine  Xz4 x"efforts to develop and market such services using national 555 numbers.3z  {O'ԍ Id.3 WP states that the  xcompetitive concerns that led the Commission to impose the 10digit dialing requirement do not  xapply to national 555 numbers because any customer, whether its local exchange carrier is the  xIincumbent or a new entrant, would be able to reach a national 555 number subscriber by dialing  X4 x<seven digits.9R  {O!"'ԍ Id. at 5.9 Further, WP argues that national 555 numbers were developed and assigned to"#0*%%ZZ"  xprovide abbreviated, uniform national dialing, and that this goal will be thwarted if the 10digit  X4dialing requirement is applied to these numbers.4 {Ob'ԍ Id. 4  X4 "049. WP states that exempting national 555 numbers from the Commission's 10digit  xdialing requirement also would be consistent with industrydeveloped guidelines. According to  xWP, the technical service interconnection arrangements developed by the Industry Carriers  xCompatibility Forum (ICCF) contemplate that 555 numbers assigned on a national basis could  xbe dialed using only seven digits from any location in any NPA. The industry guidelines state  xthat, whether geographic NPA relief activity is accomplished through geographic splits, overlays,  xRor boundary realignments, the holders of national 555 numbers will retain the right to request activation of the same number in the new NPA.  X 4 e 150. ` ` Alleging that several carriers oppose the use of 555 line numbers by companies  X 4 xnot providing directory assistance, Telco Planning opposes WP's request.K Z yO'ԍ Telco Planning Opposition at 12.K Telco Planning also  xasserts that information service providers have rejected 7digit dialing as an abbreviated dialing  x3arrangement, preferring instead arrangements that allow callers to reach them dialing three or four  X4 xdigits.9 {O+'ԍ Id. at 3.9 Telco Planning argues that 900 numbers should be used for information services.9| {O'ԍ Id. at 4.9  xUsing 555 numbers, which are traditionally used for directory assistance, for specialty information  xservices would cause enduser confusion and technical problems. Further, allowing specialty  x/information service providers to use 555 could force carriers to provide blocking for 555, which  X44may cause subscribers to be denied directory assistance.34 {O'ԍ Id.3  X4 e  251. ` ` We clarify that state commissions may allow callers to dial national 555 numbers  xVusing only seven digits, even when the call is placed from a geographic area that has an overlay  xarea code. We make this clarification subject to the qualification that callers in both the old area  xcode and the new overlay area code must be able to dial seven digits to reach the national 555  xunumbers. If all callers are able to reach the national 555 numbers using only seven digits,  xregardless of the carrier that provides the callers' service, such calls would not cause the type of  xanticompetitive effects that can be avoided in other cases only by requiring 10digit dialing where  x/an area code overlay has been implemented. If technical problems prevent callers in either the  x<old area code or the new overlay area code from enjoying the benefits of sevendigit dialing for  x}national 555 numbers, we will require that all customers in the area covered by the overlay code"7$0*%%ZZ_"  xand the old area code must dial ten digits to reach national 555 numbers. Subject to this  xlimitation, based on their knowledge of specific local circumstances, such as the service  xRarrangements made by the holder of the national 555 number and the local dialing plan, state  X4commissions may determine if 7digit dialing for national 555 numbers is feasible. {O4' x ԍ See ICCF 555 Technical Service Interconnection Arrangements, ICCF 960411014 (April 11, 1996) at 3 n. 2 (local dialing plans may impact the feasibility of using seven digits to dial 555 numbers).  X4 e 352. ` ` We do not address Telco Planning's comments. The question of whether 555  xcnumbers should be used for purposes other than directory assistance is beyond the scope of this proceeding.  X1' e "` 6.` ` Takebacks and Grandfathering of Wireless Numbers in a Geographic Area  X 'Code Split (#`  X 4 ` ` a. Background  X 4 e 453. ` ` Once a state implements a NPA split, wireline customers on one side of the split  x`retain their old area code and 7digit number, and customers on the other side of the split get a  xVnew area code, but retain their old 7digit number. The process for wireline customers requires  xVno action on the part of the customers on either side of the split because the necessary changes  xfor routing calls with the new area code occur within the carriers' networks. Many parties are  xconcerned about the effects an NPA split has on wireless customers, however. The process will  x<not be transparent to the wireless customer, as it is to the wireline customer. Instead, because  xof the means by which wireless telephone calls are transmitted, wireless customers must have  xtheir telephones reprogrammed to surrender the old number and receive a new number in the new  X4 x"NPA. We call this type of change necessitated by a NPA geographic split a "wireless number  xtakeback." Some states have allowed wireless customers who are physically located in the new  xarea code to keep their entire 10digit numbers from the old area code when a geographic split occurs. We call this practice "wireless grandfathering."  X}4 e m554. ` ` In the Local Competition Second Report and Order, the Commission concluded  xthat the wirelessonly area code overlays that the Texas Commission proposed for the Dallas and  XQ4 xHouston areas violated the Commission's Ameritech Order, which prohibited a wirelessonly  xoverlay. We found that the Texas Commission's proposal was inconsistent with our clarification  X%4 xof the Ameritech Order in the Local Competition Second Report and Order, which prohibited all  X4 xtechnologyspecific overlays.x" {O"'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19527  305.x Parties filing comments on the Texas Commission's proposal  x<expressed concerns regarding the Texas Commission's statement that if the proposed wireless xonly overlays were found to be unlawful, it would consider a mandatory takeback of wireless"%0*%%ZZ"  xnumbers under a geographic split plan in order to balance the inconvenience and confusion caused  xby the number changes necessitated by a split. We did not act to prevent the Texas Commission  xlfrom taking back some wireless numbers in the course of introducing a geographic split plan, because:  XIn a geographic split, roughly half of the customers in the existing NPA, including  wireless customers, will have to change their telephone numbers. We recognize  that wireless customers may need to have their equipment reprogrammed to  change their telephone number, and that this will inconvenience wireless customers  -to some extent. This illustrates the fact that geographic splits also have  burdensome aspects. Our goal is to have technologyblind area code relief that  idoes not burden or favor a particular technology. Requiring approximately half  of the wireless customers and wireline customers to change numbers in a  geographic split is an equitable distribution of burdens. This is the kind of  X 4implementation detail that is best left to the states.F  {O7'ԍ Id. at 19528  308.F   X4 " 655. On October 9, 1996, the Commonwealth of Massachusetts Department of Public  Xy4 x3Utilities (DPU) requested a declaratory ruling from the Commission.yZ {O' x ԍ See Petition for Declaratory Ruling by Commonwealth of Massachusetts Department of Public Utilities, NSD {ON'L9615 (Oct. 9, 1996)(DPU Petition). The DPU was developing  xan area code relief plan in response to NXX code depletion that was occurring in two area codes  xin eastern Massachusetts, 617 and 508. The DPU stated that it had been presented with two  xoptions to address the problem. The first, an overlay, would prevent existing customers from  xhaving to change their 10digit telephone numbers. The second, a geographic split, would split  xIeach of the two depleted area codes into a north and south geographic area and give one of the areas a new area code.  X4 e `756. ` ` The DPU asked the Commission to clarify whether, in a geographic split scenario,  x}existing wireless customers could be permitted to retain their current area code or whether such  X4 xtan arrangement would violate the Second Report and Order. Under the DPU's proposal, existing  xwireless customers would retain their 10digit telephone numbers regardless of where they were  xgeographically situated, while new wireless customers would be assigned 10digit telephone  xpnumbers depending on the boundaries defined by the geographic split. The DPU also requested  xEan opinion on whether such a proposal would require 10digit local dialing. The Commission  X"4sought comment on the DPU's petition.\" {O#' x ԍ See FCC Seeks Comment on Petition for Declaratory Ruling Filed by Massachusetts Department of Public  {OS$' x^ Utilities Regarding Area Code Relief Plan for Area Codes 508 and 617, Public Notice, NSD File No. 9615, 11 FCC Rcd 13921 (1996). For ease of reference, comments on the DPU petition will be referred to as "MDPU Comments."""&0*%%ZZ"Ԍ X4 e ԙ857. ` ` On January 23, 1997, the DPU issued an Order adopting an area code relief plan  xfor the 617 and 508 area codes, without waiting for a ruling from the Commission on its October  X4 x9 petition.n^ {OK' x ԍ See Investigation by the Department of Public Utilities on its Own Motion to Adopt a Plan for Addressing  {O' x the Limited Number of Exchange Codes Remaining in Eastern Massachusetts' 617 and 508 Area Codes, D.P.U. 9661  {O'(1997) (Massachusetts DPU Order).n The Order stated that a geographic split plan is the appropriate method for area  X4 x}code relief.H yOZ'ԍ Massachusetts DPU Order at 15.H Concerning parties' requests that wireless customers be permitted to grandfather  xtheir numbers, the DPU found that permitting wireless subscribers to retain their existing area  X4 x&code would present a number of technical problems.:~ {O 'ԍ Id. at 17.: The DPU noted that wireless and landline  xcustomers share many NXX codes. Grandfathering wireless customers would require a takeback  xof numbers from the landline customers, which would result in a minimum of 19,500 customers  XH4 xbeing assigned a new 10digit number.4H {O 'ԍ Id. 4 Alternatively, the DPU stated that both the wireless  xand landline customers sharing NXX codes prior to the split could be grandfathered, thus causing  xsome municipalities to have more than one area code. The DPU stated that both alternatives  X 4 xwould create customer confusion.3  {OV'ԍ Id.3 Also, the DPU stated that because of the way that wireless  xand landline carriers are interconnected, grandfathering wireless customers would require  xadditional switch translations and system modifications, resulting in additional costs and delays  X 4of area code relief.= 4  {O'ԍ Id. at 1718.=  X4 e 958. ` ` On May 2, 1997, the DPU issued an Order reconsidering its earlier area code relief  Xy4 xOrder.+&y  {O' x ԍ See Investigation by the Department of Public Utilities on its Own Motion to Adopt a Plan for Addressing  {O' x! the Limited Number of Exchange Codes Remaining in Eastern Massachusetts' 617 and 508 Area Codes, Order on  x Motions by Bell Atlantic NYNEX Mobile for Clarification and/or Reconsideration, NYNEX for Clarification and  {OL'Reconsideration and Cellular One for Clarification, D.P.U. 9661A (1997) (Reconsideration Order).+ In its Reconsideration Order, the DPU responded to allegations that it had not specified  xwhether it intended to allow wireless customers who are served by Type 2 interconnection to  XK4 x}retain their existing area codes.@XK yO"' xk ԍ Type 2 cellular numbers (available to subscribers from tandem switches), unlike Type 1 numbers (based on  x wire centers) are not tied to a geographic location, and therefore, there is no technical requirement forcing wireless numbers to be changed.@ The DPU acknowledged that its Order had been silent on the"K'0*%%ZZx"  X4 xissue of whether Type 2 wireless numbers could be grandfathered.K {Oy'ԍ Reconsideration Order at 5.K It granted the motions for  xVclarification, stating that, because Type 2 wireless customers do not share exchange codes with  xlandline customers, the DPU's technical concerns raised in its order did not apply. The DPU  xclarified its initial decision, and found that grandfathering of existing Type 2 wireless should  X4occur.;Z {O'ԍ Id. at 56.;  Xv4 e :59. ` ` Wireless Takebacks. Several parties have filed petitions requesting that the  xCommission reconsider its decision not to prohibit the takeback of wireless telephone numbers  x+based on their assertions that wireless number takebacks require wireless carriers to bear a  xdisproportionate share of the burden associated with a geographic split and are not technology X 4blind.X  yO' x^ ԍ AirTouch/PowerPage Petition at 16; AT&T Petition at 1214; Arch Opposition at 3; PageNet Opposition at  x  2; U S WEST Opposition at 1415; AirTouch Opposition at 2, 6 (the Commission should prohibit states from implementing mandatory wirelessonly takebacks in connection with geographic area code splits). Reply at 12.  X 4 e m;60. ` ` AT&T argues that we should clarify that state commissions may rely on voluntary  xwireless number "givebacks," but may not require wireless customers to switch their telephone  X 4 xnumbers to the new NPA in a geographic split.J  yO}'ԍ AT&T Petition at 13, Reply at 8.J At a minimum, AT&T contends that the  xCommission should clarify that it would not be inequitable for a state commission to permit  X4 xwireless customers to keep their telephone numbers in the event of an NPA split.> yO'ԍ AT&T Petition at 14.> Further,  x<AT&T states that takebacks are disproportionately burdensome to wireless customers because  Xd4 xwireless customers must return their telephones for reprogramming.d,  {OA' x ԍ Id. at 13; see also SBC Petition at 2527, Reply at 56; PageNet Opposition at 2; U S WEST Opposition at 1415; AT&T Reply at 8. Finally, AT&T observes  xthat takebacks are technologically unnecessary because wireless telephones merely have a billing address and are not located on one side of a line dividing a NPA in a geographic split.  X4 e <61. ` ` AirTouch/PowerPage observes that there are two different types of wireless  xinterconnection, each of which would be affected differently by a wireless takeback. According  xto AirTouch/PowerPage, Type 1 numbers are wireless numbers that interconnect with the public  x3switched telephone network through a central office. For Type 1 numbers subject to a geographic"( 0*%%ZZ"  X4 xsplit, the telephone number will change if the central office serving the number is changed.L yOy'ԍ AirTouch/PowerPage Petition at 17.L  xType 2 numbers are wireless numbers that interconnect with the public switched telephone  x8network through a tandem. For Type 2 numbers subject to a geographic split, the telephone  X4 xnumber will not change unless the NPA for the tandem is changed.3X {O'ԍ Id.3 AirTouch/PowerPage states  X4 xcthat CMRS paging carriers use a mix of Type 1 and Type 2 numbers.3 {O? 'ԍ Id.3 AirTouch/PowerPage  x+further states that both wireless and wireline telephone numbers will change as a result of a  Xv4 x geographic split,Lv| yO 'ԍ AirTouch/PowerPage Petition at 17.L but alleges that under Texas' proposed plan, wireless carriers are required first  xto give back telephone numbers and then to require existing customers to change their telephone  XH4 xnumbers in the new NPA.[H  {O'ԍ Id.; see also AirTouch Comments at 4.[ AirTouch/PowerPage asserts that the proposed takeback of wireless  xtelephone numbers is discriminatory because the Texas Commission plan contains a takeback of  X 4 xZonly wireless telephone numbers.L  yOi'ԍ AirTouch/PowerPage Petition at 19.L AirTouch/PowerPage also argues that the proposed takeback  X 4 x}of wireless numbers violates the Commission's goal to have technologyblind area code relief.3 .  {O'ԍ Id.3  xIt agrees that changing Type 1 numbers along with the rest of the numbers in their respective  x<central offices would satisfy that goal, but that the forced change of Type 2 numbers would not  xbecause CMRS carriers are generally the only telecommunications carriers taking Type 2  X 4 xtnumbers.P  yO'ԍ Type 2 numbers are served by a tandem.P Therefore, requiring CMRS carriers with Type 2 numbers to change the NPA of one xhalf of their customers subjects them to burdens that other telecommunications carriers do not  Xy4have.LyP  yOz'ԍ AirTouch/PowerPage Petition at 20.L  XK4 e ,=62.` ` AirTouch/PowerPage asserts that the only technologyblind mechanism would be  xto allow CMRS carriers with Type 2 numbers to remain in the existing NPA and require Type"4)0*%%ZZ"  X4 x<1 numbers to change with the underlying central office.# {Oy' x ԍ Id.; see also PageNet Petition at 6 (Takebacks of Type 2 wireless numbers are neither technically required  xx nor justified in terms of any equitable sharing of relief burdens. Type 2 wireless numbers are not tied to any fixed  x! geographic location. Takebacks of Type 2 wireless numbers are, further, not justified because voluntary subscriber  x requests typically result in a level of number relief and carrier burden that is comparable to what occurs in the case  {O' x; of a mandatory number takeback.) See also AirTouch Opposition at 5; Arch Opposition at 34; PageNet Opposition at 2; PCIA Opposition at 34, Reply at 23; U S WEST Opposition at 1415.# If the Commission disagrees that no  xaction should be taken for Type 2 numbers, AirTouch/PowerPage contends that the Commission  x/should permit wireless carriers to determine which Type 2 numbers will change as the result of  X4 x/a split.OD yO 'ԍ AirTouch/PowerPage Petition at 2021.O Neither the NANP administrator nor any state commission should interfere with that  xdetermination if the wireless carrier has made provisions for a proportionate number of its  X4 xtelephone numbers to change upon implementation of the split.: {O'ԍ Id. at 22.: Regarding wireline numbers  xand Type 1 wireless numbers, AirTouch/PowerPage asserts that determining which numbers will  xchange is a ministerial task. The numbers served by central offices subject to the new NPA will  xZchange. Type 2 numbers, however, are not associated with any particular NPA because a tandem  X14 xthat serves them may serve both the old NPA and the new NPA.=1f  {OH'ԍ Id. at 2021.= Therefore,  xNAirTouch/PowerPage argues that a "geographic" split with respect to these numbers is a  X 4misnomer.3  {O'ԍ Id.3  X 4 e >63. ` ` The Massachusetts DPU Petition. Several parties commenting on the DPU's  x'petition for a declaratory ruling favor a geographic split over an overlay and also support  X 4 xlallowing grandfathering of wireless customers when a geographic split is initiated._  yO'ԍ TCG MDPU Comments at 14; NECTA MDPU Comments at 17._ Others  xfavor overlays, but also support allowing grandfathering of wireless customers if a geographic  X{4 x'split occurs.E{ yOF'ԍ SWBMS MDPU Comments at 24.E Some parties assert that states should have the authority to develop and  x&implement area code relief plans, and to determine whether to grandfather the numbers of existing  XM4 xwireless customers.aZM {O"' x ԍ BANM MDPU Comments at 24; NECTA MDPU Comments at 1, 4, 7; ProNet MDPU Comments at 3.   {Op#' x See also SWBMS MDPU Comments at 34 (favoring overlay over split but arguing that states may grandfather existing wireless customers when they adopt a geographic split plan).a According to these parties, states should evaluate whether grandfathering"M*0*%%ZZx"  X4 xis needed, with the requirement that states may not offer discriminatory solutions.D yOy'ԍ BANM MDPU Comments at 24.D These parties also note that other states, such as California, Illinois, and  X4 xMissouri have implemented grandfathering policies.X yO' x ԍ TCG MDPU Comments at 8; BANM MDPU Comments at 910; NECTA MDPU Comments at 910; AirTouch MDPU Comments at 56. AT&T asserts that the Commission should  xAclarify that states may not require mandatory takebacks as part of an NPA split, but at a  xIminimum, should clarify that state commissions may rely on voluntary number givebacks, rather  xthan requiring wireless customers to switch their numbers to the new NPA when a split plan is  Xv4 x0implemented.Bv yO 'ԍ AT&T MDPU Comments at 2.B PageNet asserts that because there is no justification for prohibiting  x"grandfathering, requiring mandatory takebacks of wireless numbers would conflict with section  XH4201(b) of the Communications Act.EH@ yO9'ԍ PageNet MDPU Comments at 4.E  X 4 e ?64. ` ` Parties state that allowing grandfathering for existing wireless customers will be  xprocompetitive because customers and companies will avoid the expense associated with  X 4 xreprogramming cellular handsets to accommodate a split.Z  {Om' x ԍ TCG MDPU Comments at 1; BANM MDPU Comments at 79; NECTA MDPU Comments at 1112;  x SWBMS MDPU Comments at 5; AT&T MDPU Comments at 3; AirTouch MDPU Comments at 3; PageNet MDPU Comments at 23. In addition, parties argue that  xconsumers will not be confused about the location of cellular telephone customers because  X 4 xexisting wireless customers are mobile and do not have a fixed geographic base.  yOa' x ԍ TCG MDPU Comments at 12; NECTA MDPU Comments at 12; SWBMS MDPU Comments at 79; AT&T MDPU Comments at 3; PageNet MDPU Comments at 2. AT&T notes  x<that, without grandfathering, some wireless customers will be forced to change their NPAs and  xtheir 7digit numbers if a takeback of numbers is ordered. If the wireless carrier cannot obtain  xa NXX in the new NPA that is identical to the NXX assigned to it in the old NPA, wireless  xcustomers reassigned to the new NPA could be forced to change their NXX as well as their area  XK4 xpcode.BKJ  yOF 'ԍ AT&T MDPU Comments at 4.B Commenters also state that there is no technical reason to force wireless customers to  X44 xchange their numbers.k"4 yO"' x ԍ PageNet MDPU Comments at 34. Voluntary conversion of Type 2 numbers is likely to lead to a level of  {O#' xo number relief comparable to what would occur with a mandatory takeback of those numbers. See also AT&T MDPU  x. Comments at 56 (a system of voluntary givebacks can be an effective part of NPA relief efforts because customers  x in the new NPA with wireless and wireline telephones will choose to change their wireless area codes to avoid"%0*%%"%" confusion).k SWBMS argues that states should not be precluded under a guise of"4+X0*%%ZZU"  x"technologyblind" area code relief from decreasing the burdens associated with area code relief  xfor some carriers while not increasing the burden on any other customer or carrier. SWBMS also  x/argues that states should implement options, such as grandfathering, that lessen the burdens for  X4 xcsome while not disadvantaging others.ZX {O' x ԍ SWBMS MDPU Comments at 4; see also PageNet MDPU Comments at 7 (grandfathering does not harm  x. any other segment of the industry); AT&T MDPU Comments at 2 (a technologically neutral policy is commendable, but inherent differences between wireline and wireless telephones make treating them in the same manner unfair). Further, SWBMS states that voluntary grandfathering  X4 x}allows states to let customers decide whether the old or new area code best suits their needs.:z {O 'ԍ Id. at 11.:  x8NECTA states that the class of grandfathered customers could be drawn narrowly to focus  Xv4specifically on the customers facing the heaviest burdens without grandfathering.Gv  yO3'ԍ NECTA MDPU Comments at 1213.G  XH4 e @65. ` ` SWBMS also argues that the methods for returning wireless numbers in the  xabsence of grandfathering are impractical. First, if numbers are returned based on the billing  xaddress, the same group of consumers is burdened twice. Most wireless customers also have  xlwireline telephones. SWBMS asserts that it does not make sense to tell a wireline customer  xwhose NPA is changing that he will be additionally burdened by having a new NPA for his  X 4 xwireless telephone.p  {O"'ԍ SWBMS MDPU Comments at 10; see also AirTouch MDPU Comments at 8.p Also, SWBMS states that because the NPA boundary lines are based on  xIwireline exchange boundaries and numbers out of wireless NXXs are not assigned to a specific  xggeographic area, wireless carriers have customers on both sides of the NPA boundary. Therefore,  xreturning wireless numbers based on the billing address will not "empty" any NXXs and therefore  Xy4 xIdoes not contribute to NPA relief.3y.  {OX'ԍ Id.3 Second, SWBMS maintains that it would be "arbitrary" to  Xb4 xlmandate that wireless carriers return a set number of NXXs.3b  {O'ԍ Id.3 Third, SWBMS argues that  xNreturning NXXs based on the location of the tandem or the end office results in an "all or  x<nothing" situation. Whether the particular tandem is within the old or the new area code will be  xcritical in determining how many of the wireless carriers' customers have to change numbers, and  xcould result in a competitive disadvantage if the carriers are not taking their blocks from the same  xtandem. Also, often the local exchange company may use the same tandem to support the old  X4and new area codes.4R  {O$'ԍ Id. 4",0*%%ZZ"Ԍ X4 e 1ԙA66. ` ` BANM argues that grandfathering does not create discrimination against a  x"particular service and that the concerns raised by the overlay area code relief plans considered  X4 x in the Ameritech decision and the Local Competition Second Report and Order are not present  xVwith grandfathering because both wireless and wireline customers would share the new and old  X4 xarea codes." {O' xc ԍ Id. at 56; see also PageNet MDPU Comments at 6. PageNet asserts that allowing grandfathering is  x consistent with the Commission's procompetitive goals. Under a geographic split plan permitting grandfathering,  x7 new entrants will still have access to old and new numbers on a first come, first served basis, and no carriers will be forced to compete only with the less familiar numbers. NECTA agrees that grandfathering of wireless numbers does not result in an  X4 xpoverlay and that the plan does not violate the Local Competition Second Report and OrderC yO 'ԍ NECTA MDPU Comments at 8.C  x because NPAs are not limited to a single form of telecommunications technology or service under  xEthe grandfathering plan. SWBMS states that 10digit dialing should not be required because  XL4 xhgrandfathering will not confer a competitive advantage that any group must overcome.ELB yO?'ԍ SWBMS MDPU Comments at 13. E  xSWBMS adds that, practically, 10digit dialing will be required for all calls between area  X 4codes.3  {O'ԍ Id.3 To require 10digit dialing for other calls would merely create unnecessary burdens.Z d  {O3' x ԍ SWBMS MDPU Comments at 13; see also AT&T MDPU Comments at 6; AirTouch MDPU Comments at  xU 78; PageNet MDPU Comments at 67 (since grandfathering does not harm competition, there is no reason to impose 10digit dialing); PageNet MDPU Comments at 34 (no 10digit dialing required in a geographic split plan).  X 4 e B67. ` ` Some parties oppose grandfathering of existing wireless customers. NYNEX  xsupports an allservices area code overlay and argues that grandfathering of wireless numbers in  xa geographic split plan is equivalent to an overlay (because the new NPA would be "overlaid"  X 4 xby wireless customers retaining the old area code) and therefore requires 10digit dialing.o   {O'ԍ NYNEX MDPU Comments at 3; see also Sprint MDPU Comments at 23.o Also,  xENYNEX argues that the overlay is a servicespecific overlay because only existing wireless  x+customers would be allowed to retain their existing 10digit numbers with the old area code.  xNYNEX asserts that if a servicespecific overlay approach were adopted, either: (1) wireline  x}customers that share Type 1 NXXs with wireless customers would retain the existing area code  xalong with the wireless customers; or (2) wireline customers that share Type 1 NXXs with  xIwireless customers would undergo a 10digit number change to remove them from the affected  X 4 x/NXX. NYNEX maintains that neither option is palatable.9   {O#'ԍ Id. at 4.9 NYNEX and TPI also assert that" - 0*%%ZZ"  X4 xgrandfathering would create customer confusion.9  {Oy'ԍ Id. at 5.9 Sprint argues that allowing  xgrandfathering gives wireless carriers an advantage because customers will be unlikely to change  X4carriers if they are allowed to retain their NPA.D Z yO'ԍ Sprint MDPU Comments at 2.D  X4 e C68. ` ` We deny petitioners' requests for reconsideration of our decision in the Local  X4 xCompetition Second Report and Order not to prohibit takebacks of wireless numbers. Further,  xwe are not considering petitions filed regarding issues raised in this docket concerning the Texas  x}area code relief plan. Subsequent actions by the Texas Commission have rendered these issues  XL4 xmoot. L yO ' x ԍ The Texas Commission ultimately determined not to institute any wirelessonly overlays, did not require  xM wireless takebacks, and affirmed its prior determination regarding the area code relief plans for the Dallas and  {Ow' x| Houston areas, see Remand of the Commission's Decision in Docket No. 14447, Docket No. 16910, February 6, 1997.  xZ This docket is not the proper forum for comments concerning other issues decided in that order by the Texas Commission. Such issues should be brought before the Texas Commission. We understand commenters' concerns regarding the burdens associated with  xWreprogramming wireless equipment. We also recognize that our decision to leave this  ximplementation detail to state commissions could result in some wireless number changes that are  xnot technically necessary. We continue to believe, however, that, under these circumstances,  xstates are best equipped to determine how the burdens associated with area code relief are most  x}equitably distributed among various telecommunications services providers operating within their  X 4 xborders.x  {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19512  272.x That determination would include whether takebacks of wireless numbers should  xoccur. State commissions may also implement voluntary wireless number givebacks or  xgrandfather wireless numbers, subject to certain guidelines specified below, if they find from their  xuexamination of the particular local circumstances that to do so will equitably distribute the  Xf4 xburdens of area code relief.f.  yOE' x ԍ Factors that states might consider include the number of wireless customers affected, the location of wireless customers, and the type of interconnection the wireless carriers are using. As we stated in the Local Competition Second Report and Order,  xour goal is to have technologyblind area code relief that does not burden or favor a particular  xtechnology. We emphasize that, although we have delegated authority to states to implement new  xarea codes, state commissions must implement area code relief plans that are consistent with the  X 4 xcgoal of technologyblind area code relief, the guidelines set out in the Ameritech Order, and our  X4 xarea code relief regulations as defined in the Local Competition Second Report and Order.  {O.#'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1951619  281289.  xParties alleging that a particular area code relief plan discriminates unreasonably against a".0*%%ZZ"  xpparticular industry segment, or otherwise is inconsistent with our guidelines and regulations, may  X4file a petition for declaratory ruling with the Commission under section 1.2 of our rules.= yOb'ԍ 47 C.F.R.  1.2.=  X4 e SD69. ` ` We will not disturb the DPU's decision to allow grandfathering of Type 2 wireless  xnumbers. We have delegated authority to the states to implement new area codes, and this  x8particular implementation detail is best left to the state commissions. State commissions are  xbetter situated than we are to determine what type of area code relief should occur and precisely  xhow it should be implemented in a particular state. As noted above, state commissions should  xNcraft area code relief plans, including the treatment of wireless numbers, with the goal of  xequitably distributing the burdens associated with area code relief over all segments of the  xtelecommunications industry. The record in this proceeding indicates that grandfathering is most  x/feasible for Type 2 numbers because the sharing of NXX codes between wireless and wireline  xcarriers with Type 1 interconnection creates technical difficulties with grandfathering Type 1 numbers. Therefore, the following discussion refers only to Type 2 numbers.  X 4 e E70. ` ` Grandfathering wireless numbers raises concerns about its possible negative impact  x<on number conservation. Because the rate of NXX code assignments directly correlates to the  xrate of area code changes, we must balance the need to maintain efficient administration of  xnumbering resources against the goal of equitable distribution of the burdens within area code  xErelief plans. If state commissions allow wireless carriers to grandfather numbers of existing  x"wireless customers in a geographic split, they must also allow the carriers to continue assigning  xunused numbers from the old NPANXX (i.e., numbers from the "grandfathered" NXXs).  xIPermitting wireless carriers to continue to assign numbers to new customers out of NXX codes  xin the old NPA avoids the prospect of leaving numbering resources stranded in the grandfathered  xNXX code. Wireless carriers should fully use these numbering resources prior to obtaining additional numbering resources from the new NPA.  X4 e KF71. ` ` We recognize that allowing wireless grandfathering results in the functional  X|4 xIequivalent of a servicespecific overlay in the new NPA.|X yO' x ԍ We have announced our intent to reexamine the prohibition against technologyspecific overlays in the  {OM'Numbering Resource Optimization Notice, at  256261. The overlay, however, is limited to  x&existing wireless customers in the new NPA, plus any additional new wireless customers that may  x8"fill up" the grandfathered wireless NXXs. This limitation reduces the competitive concerns  x3associated with a technologyspecific overlay. State commissions should, however, consider those  x4competitive concerns when crafting area code relief plans, and balance them against the  xcconvenience wireless carriers gain through grandfathering of wireless numbers. We emphasize  x8again that burdens associated with area code relief should be equitably distributed among all segments of the telecommunications industry."/0*%%ZZ"Ԍ  X' B.Discriminatory NXX Code Opening Charges  X4 1.` ` Background  X4 e G72. ` ` We observed, in the Local Competition Second Report and Order, that charging  xdifferent "code opening" fees for different providers or categories of providers of telephone  xexchange service violates the section 251(b)(3) nondiscrimination requirement and the section  XK4 x_202(a) prohibition of unreasonable discrimination.K {O ' x ԍ 47 U.S.C.  251(b)(3); 47 U.S.C.  202(a); Local Competition Second Report and Order, 11 FCC Rcd at 19537  332. In addition, we concluded that charging  xdifferent "code opening" fees constitutes an "unjust practice" and "unjust charge" under section  X 4 xA201(b). " {O 'ԍ 47 U.S.C.  201(b); Local Competition Second Report and Order, 11 FCC Rcd at 19538  332. Further, we found the practice inconsistent with the principle stated in section  X 4 x3251(e)(1) that numbers are to be available on an equitable basis.  {Ok'ԍ 47 U.S.C.  251(e)(1); Local Competition Second Report and Order, 11 FCC Rcd at 1958  332. We also stated that incumbent  xLECs must treat other carriers as the incumbent LECs would treat themselves. We therefore  xextended the prohibition against LECs charging discriminatory fees for numbering to cover  X 4charges to paging companies.x F {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19538  333.x  X4 2.` ` Discussion  Xf4 e FH73. ` ` AT&T, AirTouch, PageNet, TCG, and PCIA allege that incumbent LECs serving  XO4 xMas code administrators charge widely varying NXX codeVO {O'ԍ NXX codes are defined supra at  5.V opening fees.Oj  yOj' x ԍ AT&T Petition at 1011; AirTouch Opposition at 1314; PageNet Opposition at 9; TCG Opposition at 1011; PCIA Opposition at 78. These parties request  xpthat the Commission limit such fees to forwardlooking costs that would be borne by any neutral  X!4 xthird party acting as numbering administrator.3!  {O 'ԍ Id.3 TCG and BellSouth report that code assignment  xZcharges are assessed by NXX code administrators to recover the administrative costs of physically  X4 xprocessing NXX code assignment requests and assigning NXXs to carriers.TT  yO#'ԍ BellSouth Reply 23; TCG Opposition at 10.T AT&T and TCG  xassert that incumbent LECs should not charge carriers receiving NXX codes for costs that"00*%%ZZ"  xMincumbent LECs incur to route traffic to new NXX codes because every carrier that interconnects  xIwith the LEC to which the new NXX is assigned must also modify its own network switches to  X4 xrecognize the new code.T yOK'ԍ AT&T Petition at 11; TCG Opposition at 11.T Agreeing, BellSouth advises that it does not intend to charge other  xcarriers for "code opening" costs that BellSouth incurs to modify its network to recognize new  X4 x}or modified NXX codes.?X yO'ԍ BellSouth Reply at 5.? BellSouth, however, contends that the Commission should state that  xLECs can recover costs incurred to maintain numbering information in the Routing Data Base  x[System (RDBS) and Bellcore Rating Input Database System (BRIDS) and for assuming  X_4 x&Administrative Operating Company Number responsibilities.Z_ yO 'ԍ BellSouth Petition at 9; BellSouth Reply at 45.Z GTE states that it does not charge  xother carriers for the hardware and software required to open a new NXX but rather charges other  xcarriers only the actual costs it incurs to "cover the administrative costs of adding new  X 4capacity."? x yOC'ԍ GTE Opposition at 16.?  X 4 e KI74. ` ` AT&T further urges us to require that incumbent LECs charge themselves  xpretroactively for every NXX code that they have previously allocated to themselves at the same  X 4 xVrate that they have charged their competitors for the distribution of NXXs.3  {Ow'ԍ Id.3 BellSouth asserts  xthat the Commission does not have the authority to apply such a regulation on a retroactive basis  X4 xand requests that the Commission deny AT&T's request.D  yO'ԍ BellSouth Opposition at 4.D PTG also seeks to deny AT&T's  xproposal noting that section 251(e) of the Act establishes that telecommunications numbering  xadministration costs should be borne by all telecommunications carriers on a competitively neutral  XK4 xIbasis and should not be allocated on costs to a hypothetical third party.>!K*  yO&'ԍ PTG Opposition at 5.> U S WEST contends  xthat costs associated with opening a new NXX code should be assessed to the carrier seeking  xyassignment of the new code while costs associated with code administration should be levied  X4uniformly upon all code users through a general administration fee.G"  yOq!'ԍ U S WEST Opposition at 910. G "1J "0*%%ZZ"Ԍ X4 e J75. ` ` Certain parties state that incumbent LECs are assessing unreasonable, unjust, or  X4 xdiscriminatory charges for functions associated with NXX code administration.r# yOb'ԍ AirTouch Opposition at 13; Arch Opposition at 3; AT&T Petition at 1011.r Noting that  xwireless carriers utilize numbers that require Type 1 or Type 2 interconnection, Arch contends  x3that many LECs charge wireless carriers exorbitant fees to issue and maintain numbers. Because  x<Type 2 numbers reside in the switch of the wireless carrier, and because LECs do not maintain  xthose numbers, Arch maintains that LECs incur no costs to justify their charges. In addition Arch  Xv4 xargues that, although LECs must input Type 1 numbers into their switch software, these costs are  X_4 xde minimis.C$_X yOh 'ԍ Arch Opposition at 12. C AirTouch compares the rates charged to open NXX codes in different NPAs and  x argues that incumbent LECs seem to base code opening fees upon market demand for NXXs and  xnot administrative costs. In support of this argument, AirTouch observes that Pacific Bell  x/charged AirTouch $9,400 to open an NXX in the 909 NPA and $30,600 to open an NXX in the  X 4 x818 NPA.D%  yO'ԍ AirTouch Opposition at 13.D Arch reports that the Rochester Telephone Corporation charged it a recurring charge  xcof $12.36 for a block of 100 numbers, a charge that Rochester Telephone states is for use of its  X 4 x "DID facilities."&" x {O' x ԍ Arch Opposition at 3, citing Letter from Rochester Telephone Corp. to Dennis M. Doyle, Arch  x Communications Group, Inc., dated Oct. 28, 1996. The term "DID" refers to direct inward dialing capacity.  yO' x NEWTON'S TELECOM DICTIONARY, 11th Edition, at 181. DID facilities are the DID trunks through which calls are transmitted to the central office. Arch asserts that the charge should not be permitted because it is a "recurring  X 4 x}charge solely for the use of numbers."?' b  yO'ԍ Arch Opposition at 3.?  AT&T requests us to ensure that incumbent LECs do  X 4not use their control over numbering resources to their own advantage.?(  yOL'ԍ AT&T Petition at 10. ?  X{4 e  K76.` ` Request for Additional Information. In order to clarify petitioners' concerns about  xincumbent LEC NXX code charges and to specify the functions that parties associate with the  x"terms "code assignment," "code activation," and "code opening," the Network Services Division  xof the Common Carrier Bureau sent requests for information (RFIs) to parties commenting on  x<these issues and invited those parties to meet with Bureau staff. The parties subsequently filed  X 4ex parte comments that were included in the record of this proceeding.  X4 e L77.` ` Code Assignment The parties that responded to this request consistently stated that  xcode assignment is performed by the incumbent LEC serving as NPA administrator. Arch"2 (0*%%ZZ"  X4 xrecommends that the Commission describe this term as "administration of CO codes.") {Oy' xt ԍ See Letter from Dennis M. Doyle, Arch, to William F. Caton, FCC, dated August 22, 1997 (Arch August 22 ex parte), at 3. This  xfunction includes receiving and processing NXX code request forms from requesting  X4 xtelecommunications service providers and assigning NXXs in accordance with the NXX  X4 x3Assignment Guidelines.* " {O' x ԍ See Letter from Kathleen Q. Abernathy, AirTouch, to Renee Alexander, FCC, dated August 26, 1997  x (AirTouch August 26 ex parte), at 2; Arch August 22 ex parte at 3; Letter from Frank S. Simone, AT&T, to William  x F. Caton, FCC, dated August 20, 1997 (AT&T August 20 ex parte), at 34; Response to Request for Information  xx from M. Robert Sutherland and Theodore R. Kingsley, BellSouth, dated August 19, 1997 (BellSouth August 19 ex  x parte), at 45; Letter from Christine M. Crowe, PCIA, to William F. Caton, FCC, dated August 22, 1997 (PCIA  xg August 22 ex parte), at 2; Letter from Link Brown, SBC, to William F. Caton, FCC, dated August 22, 1997 (SBC  x August 22 ex parte), at 2; Letter from Judith E. Herrman, TCG, to William F. Caton, FCC, dated August 22, 1997  x} (TCG August 22 ex parte), at 1; Letter from Robert H. Jackson, U S WEST, to William F. Caton, FCC, dated  {O 'August 13, 1997 (U S WEST August 13 ex parte), at 1; CO Code Guidelines at 79. According to AirTouch, BellSouth, TCG, GTE, SBC, and U S WEST,  X4 xcarriers are not generally charged for the assignment of CO codes.+  yOO' xg ԍ AirTouch August 26 ex parte at 4; BellSouth August 19 ex parte at 5; TCG August 22 ex parte at 1. GTE  {O' x does not charge fees for any of the CO code assignment areas in Florida and Hawaii that it administers. See Letter  x from W. Scott Randolph, GTE, to William F. Caton, FCC, dated August 21, 1997 (GTE August 21 ex parte), at 2.  x SBC states that it does not charge any fees to carriers for CO code assignment. SBC August 22 ex parte at 2. U  x7 S WEST does not charge any carrier a fee in connection with code assignment functions. U S WEST August 13 ex parte at 2. Although LECs serving as  xcode administrators have not historically charged carriers for these CO code administration  xservices, BellSouth declares that these costs are "clearly recoverable" as the Commission has  Xc4 xdetermined in the Local Competition Second Report and Order that incumbent LECs may charge  xcarriers fees for NXX code assignment as long as one uniform fee is charged for all carriers and  x"the 1996 amendments to the Act provide that the costs of number administration shall be borne  X 4 xZby all carriers on a competitively neutral basis., p {OA' x ԍ BellSouth August 19 ex parte at 56, citing the Local Competition Second Report and Order, 11 FCC Rcd at 1953738  332. AT&T asserts that code assignment is a record X 4 xkeeping function for which charges should be de minimis.G-  yO'ԍ AT&T August 20 ex parte at 2.G Arch asserts, however, that SNET  X 4continues to charge $189.00 for each CO code it assigns in Connecticut.G. Z yO 'ԍ Arch August 22 ex parte at 5.G   X 4 e M78.` ` Code Activation U S WEST agrees that code activation includes update of the  xlBellcore Traffic Routing Administration databases, RDBS and BRIDS, to include new NXX" 3.0*%%ZZ "  X4 xinformation, although it prefers to use the term "notification of CO codes."K/ yOy'ԍ U S WEST August 13 ex parte at 2.K BellSouth, AT&T,  xMand Arch state that the terms code activation and code opening are generally used interchangeably  X4 xwithin the telecommunications industry.0X yO'ԍ Arch August 22 ex parte at 4; AT&T August 20 ex parte at 2; BellSouth August 19 ex parte at 8. BellSouth reports that carriers may enter the NXX  xinformation into the Bellcore databases themselves, or they may negotiate with another company  X4 xto perform this function on their behalf.L1 yO= 'ԍ BellSouth August 19 ex parte at 8.L SWBT charges $110.00 when it performs the data  X4 xentry function for other entities.F2x yO 'ԍ SBC August 22 ex parte at 3.F The BRIDS products are used for toll message rating  xpurposes while the RDBS products are used for traffic routing purposes in the public switched  X_4 xMtelephone network.3Z_ yO' x ԍ BellSouth August 19 ex parte at 8. The RDBS database contains routing information and is used to produce  xH the Local Exchange Routing Guide (LERG). The BRIDS database contains rating information and is used to produce  {O'the Terminating Point Master (TPM). See NXX Assignment Guidelines at 3.  BellSouth and TCG note that entities are assessed recurring annual charges  XH4 xfor record space maintained in the Bellcore databases for each NXX activated by a carrier.i4H*  yO#'ԍ BellSouth August 19 ex parte at 8; TCG August 22 ex parte at 2.i  xGTE and U S WEST assert that they do not charge fees for code activation functions in the areas  X 4where they serve as CO administrator.h5  yO'ԍ GTE August 21 ex parte at 3; U S WEST August 13 ex parte at 2.h  X 4 e ,N79.` ` Code Opening AT&T, BellSouth, PCIA, GTE, and TCG generally describe code  xopening as including the functions that each telecommunications service provider utilizes to  xupdate the translation tables in its switches with routing information contained in the Local  xExchange Routing Guide (LERG) and to modify other portions of its network to recognize the  X4 xlnew or modified NXX data.6J  yO' x ԍ AT&T August 20 ex parte at 2; BellSouth August 19 ex parte at 11; PCIA August 22 ex parte at 67; GTE August 21 ex parte at 1, 4; TCG August 22 ex parte at 2. AT&T states that translation table updates and other system  xRmodifications are an essential component of providing telecommunications services, and that  xhwithout such updates the customers of a telecommunications carrier would not be able to  XK4 xcomplete calls to the new NXX.H7K yO"'ԍ AT&T August 20 ex parte at 2. H AT&T deems these expenses "a cost of doing business" and  x}asserts that carriers have historically not sought to recover costs associated with modifying their"44270*%%ZZ"  X4 xown systems to recognize new NXXs.98 {Oy'ԍ Id. at 3.9 TCG and U S WEST state that they neither charge nor  X4 xare charged by other carriers for code opening functions.j9Z yO'ԍ TCG August 22 ex parte at 23; U S WEST August 13 ex parte at 2.j Arch states that all incumbent LEC  xcode administrators have stopped the practice of charging Arch for opening or activating NXX  X4 xycodes for Type 2 interconnection.I: yOV'ԍ Arch August 22 ex parte at 6. I PCIA, however, states that its members continue to be  xassessed varying charges by incumbent LECs for CO code activation, CO code opening, and CO  X4 xcode "reservation.";z yO ' x ԍ PCIA August 22 ex parte at 8. Reserved CO codes (NXX codes) are codes that have been identified and  x set aside by the Code Administrator for some specific use or purpose. The reserved NXX code is not available for  {OH ' x! assignment but neither has it been officially assigned by the Code Administrator to an entity. CO Code Guidelines  {O' xo at 30. Recently, in the Numbering Resource Optimization Notice, we sought comment on whether time limits should  {O' xo be imposed on the amount of time a code may be held in reserved status. Numbering Resource Optimization Notice at  49. According to PageNet, BellSouth charged it $8,285.00 to open an NXX  xcode with numbers used for Type 2 interconnection; PTG charged it $30,600.00, $27,600.00, and  x$24,900 for three NXX codes with Type 2 numbers; and Nevada Bell charged it $2,833.33 to  XH4 xcopen an NXX code containing numbers used for Type 1 interconnection.<H  yO' x3 ԍ Letter from Edward A. Yorkgitis, PageNet, to William F. Caton, FCC, dated September 3, 1997 (PageNet September 3 ex parte), at Attachment 1. AirTouch contends  x"that the California Public Utilities Commission found that "no explicit charge should be imposed  X 4on carriers for the costs of opening NXX codes."= P  {O' xo ԍ AirTouch August 26 ex parte at 5 n. 4, citing Order Instituting Rulemaking on the Commission's Own Motion  {O'into Competition for Local Exchange Service, Opinion, R. 9504044 (Cal. PUC December 20, 1996).   X 4 e v O80.` ` At the outset, we conclude that, even though the LECs no longer perform code  X 4 x_assignment functions,>  {O2'ԍ See  5, supra, for a discussion of the selection of Lockheed Martin IMS as the NANPA. they do continue to perform some code activation and code opening  xyfunctions. LECs also continue to allocate their own numbers to some paging carriers. Thus,  xpetitions for reconsideration and clarification concerning LEC charges for numbers are still relevant.  Xb4 e P81. ` ` Initially, we clarify the meanings of the terms code assignment, code activation,  x and code opening, and the functions associated with each term. Code assignment is the  xcollection, processing, and assignment of NXXs to requesting telecommunications service  X4 xproviders in accordance with the CO Code Guidelines. Code activation is the entry of code"5>>0*%%ZZ2"  xassignment information in the BRIDS, the RDBS, and other databases; the maintenance of code  xassignment information in these databases; and the publication of routing and routing information  xin output databases including the LERG and the Terminating Point Master (TPM) for distribution  X4 xto telecommunications service providers. Telcordia Technologies (previously Bellcore) maintains  X4 xthese databases.? {O' xU ԍ See id., n.32 for a discussion of Bellcore and its acquisition by Science Applications International Corporation (SAIC). Code opening is the updating of translation tables, certain switches, and other  xlnetwork elements by each entity interconnecting with the public switched telephone network  x"(PSTN) to allow that entity to route telephone calls and process rate information within its own network.  X14 e Q82.` ` After considering the information provided by the petitioners, we clarify that  X 4 xcharging different fees to different providers or categories of providers of telephone exchange  xservice for code assignment, code activation, or code opening violates the Act's section 251(b)(3)  xnondiscrimination requirement and the Act's section 202(a) prohibition against unreasonable  X 4 xdiscrimination.@ " {O' xt ԍ 47 U.S.C.  251(b)(3); 47 U.S.C.  202(a); see Local Competition Second Report and Order, 11 FCC Rcd at 1953738  332. The Act's prohibitions against those practices by LECs extends to all  xVtelecommunications common carriers, including paging carriers, because all telecommunications  X 4 xcommon carriers are to be treated equitably, and on a competitively neutral basis.A | {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19538  333; 47 U.S.C.  251(e). This  x<protection also applies to all fees and functions associated with NXXs, including the assignment  Xy4 xof telephone numbers.B y yO8' x ԍ NXXs can be comprised of Type 1 or Type 2 numbers. NXXs that are comprised of Type 1 numbers may  x7 contain wireless and wireline numbers and thus implicate issues involving, for example, sharing of NXXs by two  x or more carriers. We emphasize here that charges for partial or full NXXs with Type 1 numbers must be reasonable and must be assessed in a nondiscriminatory manner.  We find that any LEC charging competing carriers fees for code  x}assignment, code activation, or code opening can do so only if the LEC charges one uniform fee  xfor all carriers, including itself and its affiliates. Such fees must be just and reasonable as  X44 xrequired by sections 201(b) and 251(e) of the Act.OC4  yO'ԍ 47 U.S.C.  201(b) and 251(e).O We also find that AT&T has not  xtdemonstrated that its request that incumbent LECs charge themselves retroactively for every NXX  xEcode that they have previously allocated to themselves serves any identifiable public interest under the Act. Accordingly, we deny its request that we require such retroactive repayment.  X4 e R83.` ` In the Local Competition Second Report and Order the Commission concluded that  xthe term "nondiscriminatory access to telephone numbers" meant that a LEC providing telephone"6 C0*%%ZZ5"  xnumbers must permit competing providers to have access to those numbers that is identical to the  X4 xaccess that the LEC provides to itself.{D {Ob'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1944647  106.{ We, further, found that telephone companies could not  X4 x@impose recurring charges solely for the use of telephone numbers.EZ {O' x ԍ Id. at 19538, citing The Need to Promote Competition and Efficient Use of Spectrum for Radio Common  {O'Carrier Services, 59 R.R. 2d 1275, 1284 (1986) (Spectrum Order). In the Spectrum Order, we  xpconcluded that carriers do not own NXX codes or numbers but rather administer the distribution  X4 xof these numbers for the efficient operation of the PSTN.SF {O 'ԍ Spectrum Order, 59 R.R. 2d at 1284.S This analysis led us to conclude that  xcellular telephone companies are entitled to reasonable accommodation of their numbering  Xx4 xrequirements.3GxH {Oq 'ԍ Id.3 We also found that telephone companies could impose a reasonable initial  xconnection charge upon cellular carriers as compensation for costs of software updates and other  XJ4changes associated with the provision of new numbers.3HJ {O'ԍ Id.3  X 4 e FS84.` ` Some carriers allege that they continue to be charged recurring fees solely for the  xuse of numbers and unreasonable fees for initial connection costs associated with assigning blocks  X 4 xof Type 1 and Type 2 numbers in violation of the Local Competition Second Report and Order  X 4 xgand the Spectrum Order. Although transfer of CO code assignment functions to the NANPA has  X 4 x rendered allegations of LEC discriminatory charges for CO code assignment moot, we affirm that  xwhere LECs provide CO code activation services, charging different CO code activation fees for  xNdifferent providers or categories of providers of telephone exchange service continues to  X4 xconstitute a violation of section 202(a).@Il  yO'ԍ 47 U.S.C.  202(a).@ In addition we note that any fees charged for CO code  Xh4activation also must be just and reasonable, as required by section 201(b) of the Act.@Jh  yO'ԍ 47 U.S.C.  201(b).@  X:4 e iT85.` ` In addition, because the code opening process|K:  {Ow 'ԍ See supra  79 for a description of the code opening process.| involves reciprocal obligations  X#4 xamong carriers pursuant to section 251(a) of the Act,L# yO"' x ԍ 47 U.S.C.  251(a). "Each telecommunications carrier has the duty to interconnect directly or indirectly with the facilities and equipment of other telecommunications carriers." LECs may not charge CO code opening  x@fees. AT&T's contention that expenses associated with code opening are a cost of doing business" 7vL0*%%ZZ]"  xthat mutually benefits all entities utilizing the PSTN and are essential to the ongoing  x"interconnectiveness" of the telecommunications network is correct. We affirm our finding in  X4 xthe Local Competition Second Report and Order that charging different code opening fees for  xdifferent providers or categories of providers of telephone exchange service constitutes  xdiscriminatory access to telephone numbers, and thus violates section 251(b)(3) of the Act.  x}Moreover, we conclude that it also constitutes unjust and unreasonable discrimination in charges  Xx4 xthat also violates section 202(b) of the Act.Mx {O' xM ԍ 47 U.S.C.  251(b)(3), 202(b); Local Competition Second Report and Order, 11 FCC Rcd at 1953738  332. Specifically, we conclude that no charges may be  x[assessed for the opening of partial or full NXXs that contain Type 1 or Type 2 numbers.  xPursuant to section 201(b) and 202 of the Act, we explicitly extend this protection to all telecommunications common carriers, including paging carriers.  X 4 e rU86.` ` Following the dispute resolution process we have adopted for other types of  X 4 x251(b)(3) nondiscriminatory access issues,N " {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1945051  114116. we require that, if a dispute arises under section  x201(b) of the Act between a LEC providing access to telephone numbers and a competing  xprovider concerning fees for such access, the burden of proof is upon the providing LEC to  xdemonstrate with specificity: (1) that it has provided nondiscriminatory access to telephone  x[numbers, and (2) that the levying of discriminatory or unreasonable charges for CO code  xassignment or CO code activation are not caused by factors within the control of the providing  xLEC. We now authorize state regulatory commissions to resolve disputes involving fees charged  XM4 xEfor the activation of CO codes, including the assignment and activation of numbers,O M yO' x ԍ Because NXXs that contain wireless Type 1 numbers and wireline numbers implicate number sharing issues  x and we lack sufficient record to decide such matters, we do not specifically address petitioners' concerns regarding  x| fees for Type 1 numbers. We emphasize, however, that charges for Type 1 numbers cannot be unjust, unreasonable, or discriminatory. to the extent that these commissions act in a manner that is consistent with our guidelines.  X'  X'C.Paging and "Telephone Exchange Service"   X4 1.` ` Background  X4 e V87. ` ` In the Local Competition Second Report and Order, the Commission stated that  xV"[p]aging is not 'telephone exchange service' within the meaning of the Act because it is neither  x'intercommunicating service of the character ordinarily furnished by a single exchange' nor"8O0*%%ZZ"  X4 x'comparable' to such service."P {Oy'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19538  333, n.700. As support, the Commission cited section 153(47) of the Act,@QZ yO 'ԍ 47 U.S.C.  3(47). @ which states:  XThe term 'telephone exchange service' means (A) service within a telephone  exchange, or within a connected system of telephone exchanges within the same  exchange area operated to furnish to subscribers intercommunicating service of the  character ordinarily furnished by a single exchange, and which is covered by the  mexchange service charge, or (B) comparable service provided through a system of  switches, transmission equipment, or other facilities (or combination thereof) by  X14which a subscriber can originate and terminate a telecommunications service.3R1 {O 'ԍ Id.3      xThe Commission concluded that paging is not telephone exchange service as part of the analysis  X 4 xof whether the protections of section 251(b)(3)CS | yO'ԍ 47 U.S.C.  251(b)(3).C from discriminatory NXX code opening fees  X 4 xapplied to paging carriers.T  {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1953739  332335. The Commission noted that although paging carriers were not  xAentitled to section 251(b)(3) protection from discriminatory code opening fees, they were  xincreasingly competing with other CMRS providers and would be at an unfair competitive  X4 xRdisadvantage if they alone could be charged discriminatory code activation fees.FU {O'ԍ Id. at 19538  333.F We also  xyconcluded that Sections 201 and 202 of the Communications Act prohibited incumbent LECs  xfrom assessing unjust, discriminatory, or unreasonable charges for activating CO codes on any  XK4carrier or group of carriers, including paging carriers.QVK0  {O,'ԍ Id. at 1953737  332334.Q  X4 2.` ` Discussion  X4 e FW88. ` ` Several parties contend that paging is telephone exchange service and request the  x/Commission to reconsider its decision in this regard. AirTouch contends that the Commission's  xconclusion that CMRS paging is not telephone exchange service places paging carriers at a  xIcompetitive disadvantage visavis other CMRS providers that provide CMRS paging service in  x8conjunction with their primary service offerings and thus enjoy telephone exchange provider"9 V0*%%ZZF"  X4 xstatus.W" yOy' x. ԍ AirTouch Petition at 9. AirTouch notes that the Commission concluded that the obligation to provide dialing  x parity and the duty to provide nondiscriminatory access to telephone numbers, operator services, directory assistance,  x and directory listings pursuant to section 251(b)(3) runs to providers of telephone exchange service and telephone  {O'toll service. Id. at 7. AirTouch and PageNet claim that the Commission and different courts have found that  X4 xECMRS paging companies provide telephone exchange service,X& {OL' x ԍ Id. at 1012, citing Public Notice, 1 FCC 2d 830 (1965); Tariffs for Mobile Service, 53 FCC 2d 579  {O' x (Common Carrier Bureau 1975); Cellular Interconnection, 63 RR 2d 7, 17 (1987); United States v. Western Electric  {O' x& Co., 578 F. Supp. 643, 645 (D.D.C. 1983). See also PageNet Petition at 8; AirTouch Reply at 9; PCIA Reply at 4; PageNet Reply at 3. and that the Commission's  xconclusion that paging is not telephone exchange service is not supported by the Act. According  xyto these parties, the 1996 amendments to the Act did not promulgate a narrower definition of  x}telephone exchange service than the 1934 Act; rather, the amendments broadened the definition  xIto include section 153(47)(B) services and functions that are "comparable" to those provided by  Xv4 xtelephone exchange service providers.Yv yO'ԍ AirTouch Petition at 1213; PageNet Petition at 8; PageNet Opposition at 8; PCIA Reply at 4. In AirTouch's view, the expanded definition includes  X_4 x+new technologies and network configurations.BZ_0  yO@'ԍ AirTouch Petition at 13.B AirTouch argues that it is insignificant that  xCMRS paging service does not constitute an "intercommunicating" service, because oneway  xMCMRS paging service enables reciprocal communications, and realtime interactive twoway voice  X 4communication is not required to meet the statutory definition contained in section 3(47).[  {O'ԍ AirTouch Petition at 1314; see also PageNet Petition at 9; PCIA Opposition at 6.  X 4 e X89. ` ` PageNet contends that the reference in section 153(47)(B) to origination and  x"termination of telecommunications services does not preclude paging carriers from meeting the  x&definition of telephone exchange carriers. PageNet states that in construing the phrase "telephone  x}exchange service and exchange access," the Commission interpreted "and" to mean either "and"  xor "or" so that incumbent LECs must provide interconnection for purposes of transmitting and  Xy4 xrouting telephone traffic or exchange access traffic or both.\yR  {O|'ԍ PageNet Petition at 9, citing Local Competition First Report and Order, 11 FCC Rcd at 19475. PageNet states that the  x"Commission did so to be consistent with the language of the statute and Congressional intent to  XK4 xfoster competition in the local exchange market.3]K {O!'ԍ Id.3 PageNet argues that a contrary interpretation"K:v]0*%%ZZQ"  xwould arguably release LECs from the obligation to provide services in a nondiscriminatory  X4fashion to cellular, PCS, SMR, and paging.p^ {Ob'ԍ Id.; see also PageNet Opposition at 8; PageNet Reply at 2.p  X4 e 9Y90. ` ` USTA disagrees with the pagingcompany commenters and maintains that paging  xservices do not fall within the Act's definition of "telephone exchange service" because paging  X4service is not comparable to twoway, switched voice service.T_Z yO'ԍ USTA Opposition at 1112; USTA Reply at 9.T  X_4 e  Z91. ` ` We decline at this time to reconsider our decision in the Local Competition Second  XJ4 xReport and Order that paging carriers do not provide telephone exchange service as described in  xcsection 153(47) of the Act. We have already ordered that such companies shall not be charged  xdiscriminatory NXX code opening fees; accordingly, the question whether paging carriers provide  xtelephone exchange service does not affect our determination of whether to extend the protection  X 4 x/from NXX code opening fees to paging carriers. We stated in the Local Competition Second  X 4 x Report and Order that the protection from discriminatory NXX code opening fees was expressly  X 4 x<extended to paging carriers under sections 201=`  yOa'ԍ 47 U.S.C.  201.= and 202=a z yO'ԍ 47 U.S.C.  202.= of the Act.b  {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 19538  332333. Because that result  xwould not change if we ultimately determined that paging carriers do provide telephone exchange service, reconsideration of this issue is unnecessary in the context of this order.  Xj' D.  Cost Recovery for Numbering Administration  X<4 1.` ` Background  X4 e -[92.` ` In section 251(e)(2), Congress mandated that "[t]he cost of establishing  xtelecommunications numbering administration arrangements and number portability shall be borne  xby all telecommunications carriers on a competitively neutral basis as determined by the  X4 x3Commission."Cc yO!'ԍ 47 U.S.C.  251(e)(2).C In the Local Competition Second Report and Order the Commission sought to  xresolve any ambiguity between section 251(e)(2)'s requirement that cost recovery for number  xadministration be borne by all telecommunications carriers on a competitively neutral basis and";, c0*%%ZZ"  X4 xMthe language in the NANP Order,gd {Oy'ԍ NANP Order, 11 FCC Rcd 2588 at 262829  94100.g which stated that the gross revenues of each communications  xqprovider would be used to compute each provider's contribution to the new numbering  X4administrator.eZ {O'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1954041  342343.  X4 e \93.` ` The Commission initially proposed that each telecommunications carrier base its  xcontributions on the gross revenues from its provision of telecommunications services, because  x[that approach would more equitably apportion the burden of cost recovery for numbering  Xa4 xadministration than would imposing a flat fee contribution upon all telecommunications carriers.gfa {O 'ԍ NANP Order, 11 FCC Rcd 2588 at 262829  94100.g  XJ4 xThe Local Competition Second Report and Order, however, found that contributions based on  x`gross revenues would not be competitively neutral for those carriers that purchase  xtelecommunications facilities and services from other telecommunications carriers because the  xcarriers from whom they purchase services or facilities will have included in their gross revenues,  xand thus in their contributions to number administration, those revenues earned from services and  xfacilities sold to other carriers. Therefore, to avoid such an outcome, the Commission required  x all telecommunications carriers to subtract from their gross telecommunications services revenues  xhexpenditures for all telecommunications services and facilities that had been paid to other  X4 xtelecommunications carriers.g~ {O'ԍ 47 C.F.R.  52.17; Local Competition Second Report and Order, 11 FCC Rcd at 19541  343. This method is commonly referred to as the "net revenue allocator."  WO4 2.` ` Discussion  X!4 e ]94. ` ` A number of parties object to the formula for recovering the costs of numbering  X 4 xadministration adopted in the Local Competition Second Report and Order, asserting that the "net  xrevenue allocator" is not competitively neutral because it places a larger share of the costs for  X4 x=numbering administration on facilitiesbased carriers and incumbent LECs,h yO' x  ԍ Ameritech Opposition at 13; BellSouth Petition at 6; NYNEX Petition at 23; SBC Petition at 19; USTA Petition at 5; GTE Opposition at 14; U S WEST Opposition at 3, 8. thereby  xdisproportionately burdening those entities. Bell Atlantic states that the Commission should  xrequire each telecommunications service provider to contribute to cost recovery based upon its  X4 xgross revenues.Jih  yO#'ԍ Bell Atlantic Opposition at 56.J SBC suggests that the Commission adopt a new method of cost allocation"< i0*%%ZZ"  X4 xMbased upon elemental access lines (EAL).Gj {Oy'ԍ See SBC Petition at 20.G Other parties propose cost allocation formulas based on retail revenues. For  xpexample, NYNEX and GTE recommend that the Commission recover numbering administration  X4 x"costs by placing a uniform surcharge on retail rates.VkZ yO'ԍ GTE Opposition at 15; NYNEX Petition at 45.V USTA and U S WEST argue that the  x Commission should base its assessments of number administration cost recovery on each carrier's  X4 xgross retail revenues from telecommunications services.Ul yO( 'ԍ USTA Reply at 7; U S WEST Opposition at 8. U In the alternative, U S WEST  x requests that the Commission allow facilitiesbased carriers to flow through to nonfacilitiesbased  xccarriers the numbering administration costs "the facilitiesbased carriers are assigned as a result  XH4 x/of the revenues generated from this use of their network."CmHz yOs'ԍ U S WEST Opposition at 8.C Lastly, BellSouth asserts that the  xCommission should utilize retail revenues as its standard and "require that both payments made  x+to other carriers as well as payments received from other carriers be subtracted from gross  X 4revenues."Bn  yO'ԍ BellSouth Petition at 7.B  X 4 e ^95. ` ` AT&T and five other parties state that the Commission should not reconsider its  X 4 xcost allocation formula.o  yO ' x ԍ AT&T Opposition at 1617; MCI Opposition at 7; MFS Opposition at 10; NCTA Opposition at 6; Sprint Opposition at 89; and TRA Opposition at 56. MCI states that it supports the Commission's ruling because "to  xrequire or to allow the calculation to be based in part on expenditures for services such as access  x"would effectively force MCI to pay twice for access, once in payment to incumbent LECs and  Xy4 xa second time in the allocation of costs due to inclusion of access in retail costs."Apy  yO'ԍ MCI Opposition at p. 7.A MFS asserts  x/that a surcharge based upon gross retail revenues, as urged by BellSouth, NYNEX and USTA,  xwould be more difficult to implement because carriers often "do not have the information needed  xto determine which of their revenues are "retail" and which are "wholesale," because they do not  X4always know whether a customer intends to resell the services it purchases."Aq  yOP!'ԍ MFS Opposition at 910.A  X4 e , _96. ` ` Although the Commission has recently concluded in the Contributor Reporting  X4 xRequirements Order that the NANP cost recovery allocator should be changed from the "net"=q0*%%ZZ"  X4 x@revenue" allocator to the "end user" allocator,r {Oy'ԍ Contributor Reporting Requirements Order, supra, n.25, at  5970. LECs are required to recover costs under the "net  X4 xrevenue" allocator until February, 2000.EsZ {O'ԍ Id. at  70.E For the reasons below, we affirm our conclusion that the net revenues allocator is competitively neutral.  X4 e m`97.` ` In section 251(e)(2), Congress granted the Commission explicit discretion to select  xfrom among competitively neutral cost recovery methodologies, discretion the Commission  xMexercised when it chose the net revenue allocator as the cost recovery methodology for numbering  xadministration. The net revenue allocator is competitively neutral because, when it is included  xin the prices of services, it will not give one service provider an appreciable, incremental cost  xadvantage over another service provider, regardless of whether the provider is facilitiesbased or  xa nonfacilitiesbased reseller. The net revenue allocator will distribute numbering administration  x3costs to each carrier in proportion to net revenues (the gross revenues of both wholesale and retail  xservices less payments to other carriers for the purchase of inputs from other telecommunications  xproviders); thus all carriers will have to markup the prices of services they sell by approximately  x/the same amounts to recover these costs. Further, the net revenue allocator is neutral because  xEallocating numbering administration costs in proportion to enduser revenues will prevent the  x/shared costs from disparately affecting the ability of carriers to earn a normal return. Because  xcarriers' allocations of the shared costs will vary directly with their enduser revenues, their share  xof the regional database costs will increase in proportion to their customer base. Thus, no  xcarrier's portion of the shared costs will be excessive in relation to its expected revenues, and its  X44 xallocated share will only increase as it increases its revenue stream.t4 yO' x ԍ The neutrality of the net revenue allocator is illustrated by the following example. Assume a facilitiesbased  x^ Carrier A sells $1 million of services to end users and $1 million to nonfacilitiesbased Carrier B and that the cost  x recovery fee is 1%. Under the net revenue allocator Carrier A would collect $10,000 from its end users and $10,000  x from Carrier B. If Carrier B also sells $2 million in services it would pay $10,000 in fees directly to the cost  x administrator and $10,000 to Carrier A who would include these costs in the price of inputs it sells to Carrier B.  x Carrier A then would "flow through" these fees to the number administrator. Under the net revenue allocator each  x carrier pays 1% of its gross revenues for number administration or $10,000 per $1 million dollars of sales.  x Moreover, the less gross revenue a carrier has, the less it pays in numbering administration. Thus, it is neutral with respect to size and ability to earn revenues. Thus, because the net  xrevenue allocator is competitively neutral, the Commission has satisfied the directive of section 251(e)(2), and no reconsideration of this issue is required.  X4 e a98.` ` Some commenters argue that the net revenue method is biased, because they  xpmistakenly conclude that facilitiesbased carriers would not be permitted to flow through to non xfacilitiesbased carriers the numbering administration costs that the facilitiesbased carriers incur.  xVNYNEX, in particular, bases its argument against the net revenue methodology on the incorrect"> t0*%%ZZ"  xassumption that the Commission's rules prohibit facilitiesbased carriers that provide wholesale  xytelecommunications services to nonfacilitiesbased carriers from marking up their wholesale  X4 xprices to recover numbering administration costs.u" {OK' x& ԍ NYNEX Petition at 45, citing Local Competition First Report and Order, 11 FCC Rcd at 15506, 15861,  x 1586869  45, 713, 728732; NYNEX Reply at 9. Ameritech, Bell Atlantic, and BellSouth generally support the  x NYNEX's view and argue for alternative allocation methods. Ameritech Opposition at 13; Bell Atlantic Opposition at 5; BellSouth Reply at 8. NYNEX admits that permitting such flow  X4 xthrough would result in neutrality, but asserts that this is precluded by the Local Competition  X4 xSecond Report and Order. Contrary to NYNEX's assertion, nothing in the Local Competition  X4 xSecond Report and Order prohibits facilitiesbased providers from flowing numbering  X|4 x"administration costs through to the nonfacilitiesbased providers. The paragraphs in the Local  Xg4 xCompetition First Report and Order upon which NYNEX relies to develop its argument are  xRinapposite because they refer to the recovery of universal service funds, not the recovery of  xnumbering administration costs. For numbering administration cost recovery, the statutory  xstandard for wholesale prices is the retail price less "costs that will be avoided" by selling at  X 4 x"wholesale.Dv  yOp'ԍ 47 U.S.C.  252(d)(3). D Numbering administration costs are legitimate costs that cannot be avoided as a  xresult of selling at wholesale prices. Thus, facilitiesbased providers may recover an appropriate  xlportion of numbering administration costs through wholesale charges for services they sell to  x8resellers. Similarly, Commission rules present no barrier to LEC recovery of an appropriate  xRportion of numbering administration costs through the access charges the LECs collect from  xIXCs. Finally, number administration is a legitimate cost that facilitiesbased providers may  xrecover when they sell wholesale services to nonfacilitiesbased service providers. As a  x&consequence, there is no basis for assuming, as NYNEX and U S WEST do, that the states would  xnot allow LECs to recover an appropriate share of numbering administration costs in their charges  X>4for unbundled network elements.w>B yO1' x ԍ Many of the arguments petitioners made on reconsideration were also made before the Eighth Circuit in  {O' x California v. FCC. Appellants argued that the Commission's cost recovery formula would violate the Act's  x requirement that it be competitively neutral if state commissions refused to allow LECs to flow through their  x numbering administration costs in the prices they charge their competitors for telecommunications services and  x facilities. The Court of Appeals stated that the parties appeared to agree that if they were allowed to include their  xH numbering administration costs in the prices that the charged their competitors for telecommunications services and  {O' x facilities, the cost recovery method proposed by the Commission would be valid. California v. F.C.C., 124 F.3d at  xk 943. The Court ruled that the petitioners' contentions with respect to the validity of the Commission's numbering  xo administration cost recovery rule were speculative and therefore, not ripe for review because no state had concluded  xQ that LECs could not include numbering administration charges in the prices for services or facilities sold to other  {O"'telecommunications service providers. Id. at 944.   X4 e zb99.` ` Several of the commenting parties propose alternative allocators which they assert  xqare superior to the net revenue method. We conclude that not all of the proposals are"?w0*%%ZZP"  xcompetitively neutral. Bell Atlantic's gross revenue approach, as we previously discussed, is not  xcompetitively neutral because it would result in double recovery. SBC's EAL allocator also  xappears to be nonneutral because it would treat local, intraLATA toll, and interLATA toll  xEservices equally in allocating costs. Because these services are generally priced differently,  xallocating costs on the basis of elemental access lines would not appear meet our definition of  xNneutrality, since lower priced services would pay proportionately more than higher priced  xservices. Allocating numbering costs on the basis of retail revenues or rates as Bellsouth,  xNYNEX, GTE, USTA, and U S WEST propose is an improvement over many of the other  xproposals. Nonetheless, retail revenue or rate allocation is not neutral because it excludes certain  xtypes of revenues, such as those that result when a carrier purchases telecommunications inputs  x}for its own internal uses. Competitive neutrality requires that the allocator be as broadbased as  X 4possible, i.e., applied to all sources of revenues.  X 4 3.` ` 1998 Biennial Review Contributor Reporting Requirements Order.  X 4 e Wc100.` ` Although we have affirmed our conclusion in the Local Competition Second Report  X4 xand Order that the net revenues allocator is competitively neutral, we also recognized that under  xAour existing rules, the filing and reporting requirements associated with the cost recovery  Xi4 x4mechanism for NANP administrationOxi {O'ԍ 47 C.F.R.  52.1 et seq.O differ from the filing and reporting requirements  XR4 xassociated with the Telecommunications Relay Services (TRS) Fund,QyRZ {O]'ԍ 47 C.F.R.  64.601 et seq.Q federal universal service  X;4 xcsupport mechanisms,cz; {O'ԍ 47 C.F.R.  54.1 et seq., 69.1 et seq.c and the cost recovery mechanism for longterm local number portability  X$4 x(LNP) administration.P{$~ {OS'ԍ 47 C.F.R.  52.21 et seq.P Prior to our adoption of the Contributor Reporting Requirements Order,  x<carriers and certain other providers of telecommunications services had to satisfy these various  xrequirements by filing different forms or worksheets, containing similar but not identical  xinformation, at different times, at different intervals, and in different locations. Accordingly, in  xorder to lessen the regulatory burden on all telecommunications carriers, on July 14, 1999, the  X4 xCommission adopted the Contributor Reporting Requirements Order, to consolidate and  X4 xstreamline these six carrier reporting requirements into one report. The Contributor Reporting  X4 x"Requirements Order concludes that, in order to include cost recovery for the administration of  xthe North American Numbering Plan in the unified report, the NANP cost recovery allocator  x8should be changed from the "net revenue" allocator to the equally competitively neutral "end  XF4user" allocator.q|F {O%'ԍ Contributor Reporting Requirements Order at  5970.q As we mention above, this requirement will begin in March, 2000.A}F {O'ԍ Id. at  70.A"F@Z}0*%%ZZl"Ԍ X4ԙT IV. PROCEDURAL MATTERS  X' A.Regulatory Flexibility Act  X4 e Bd101.` ` As required by the Regulatory Flexibility Act (RFA), 5 U.S.C.  603, an Initial  X4 x}Regulatory Flexibility Analysis (IRFA) was incorporated in Notice of Proposed Rulemaking in  Xx4 xCC Docket No. 9698.~xZ {O 'ԍ Local Competition NPRM, n.56, supra, 11 FCC Rcd at 1426566,  27487. The Commission sought written public comment on the proposals in  Xa4 xhthis NPRM, including comment on the IRFA.Ha {O 'ԍ Id. at 14266,  286.H In addition, a Final Regulatory Flexibility  XL4 x Analysis was incorporated in the Local Competition Second Report and Order.L~ {O{'ԍ Local Competition Second Report and Order, 11 FCC Rcd at 1954260,  34698. Appendix C  X74 xsets forth the Supplemental Regulatory Flexibility Analysis on the Local Competition Second  X" 4Report and Order, Third Order on Reconsideration in CC Docket No. 9698.  X '  X ' B.Final Paperwork Reduction Act Analysis  X 4 e e102.` ` The Notice of Proposed Rulemaking from which the Local Competition Second  X 4 xReport and Order, Third Order on Reconsideration and Memorandum Opinion and Order issues  x<proposed changes to the Commission's information collection requirements. As required by the  xPaperwork Reduction Act of 1995, the Commission sought comment from the public and from  Xp4 xcOMB on the proposed changes.fp {O1'ԍ Local Competition NPRM, 11 FCC Rcd at 14266,  288.f This Third Order on Reconsideration and Memorandum  X[4 xOpinion and Order contains several new information collections, which have been submitted to  xOMB for approval. Implementation of these information collections is subject to OMB approval, as prescribed by the Paperwork Reduction Act.   X4 6% V. ORDERING CLAUSES ׃  X4 e f103. ` ` Accordingly, IT IS ORDERED that pursuant to authority contained in Sections 1,  x4(i) and (j), 201205, 218, 220, 251 and 403 of the Communications Act of 1934, as amended,  x47 U.S.C.  151, 154(i) and (j), 201205, 218, 220, 251 and 403, Parts 51 and 52 ARE AMENDED as set forth in Appendix B. "wA0*%%ZZ"Ԍ X4 e g104. ` ` IT IS FURTHER ORDERED that the relief requested in the petition for  xdeclaratory ruling filed by the Massachusetts Department of Public Utilities is GRANTED to the extent set forth herein.  X4 e h105. ` ` IT IS FURTHER ORDERED that the petitions for reconsideration and clarification ARE GRANTED to the extent indicated herein and otherwise ARE DENIED.  X_4 e 5i106. ` ` IT IS FURTHER ORDERED that the Commission's Office of Public Affairs,  XH4 x@Reference Operations Division, SHALL SEND a copy of this Local Competition Second Report  X34 xDand Order, Third Order on Reconsideration and Memorandum Opinion and Order including the  xassociated Supplemental Regulatory Flexibility Analyses to the Chief Counsel for Advocacy of the Small Business Administration.  X 4 e j107. ` ` IT IS FURTHER ORDERED, pursuant to 47 C.F.R. section 1.427, that the  xdecisions and rules adopted herein SHALL BE EFFECTIVE thirty (30) days after publication of  X 4 xthis Local Competition Second Report and Order, Third Order on Reconsideration and  X4Memorandum Opinion and Order, or a summary thereof, in the Federal Register. ` `  hhCqFEDERAL COMMUNICATIONS COMMISSION ` `  hhCqMagalie Roman Salas ` `  hhCqSecretary "B0*%%ZZ"  X' APPENDIX A LIST OF PARTIES ă  X' Petitions for Reconsideration/Clarification, filed by October 7, 1996: Airtouch Paging and PowerPage (joint comments) (Airtouch) Ameritech AT&T Corp. (AT&T) Beehive Telephone Company, Inc. (Beehive) BellSouth Corporation and BellSouth Telecommunications (BellSouth), Cox Communications, Inc. (Cox) Excell Agent Services, Inc. (Excell) GTE Service Corporation GTE) Jan David Jubon/Jubon Engineering, P.C. (Jubon) MFS Communications Co., Inc. (MFS) MCI Telecommunications Corp. (MCI) New York State Dept. of Public Service (NYDPS) NYNEX Telephone Companies (NYNEX) Omnipoint Communications, Inc. (Omnipoint) Paging Network, Inc. (PageNet) Pennsylvania Public Utility Commission (PaPUC) Rural Telephone Coalition (RTC)  xSBC Communications Inc. filed on behalf of its subsidiaries, Southwestern Bell Telephone Company (SWBT) and Southwestern Bell Mobile Systems (SWBMS) (SBC) Teleport Communications Group, Inc. (TCG) U.S. Telephone Association (USTA) The Washington Post Company (Washington Post)  X' Oppositions, filed by November 20, 1996:  X|4 Airtouch Communications Inc. (AirTouch) Ameritech Arch Communications Group, Inc. (Arch) AT&T Bell Atlantic (Bell Atlantic) Bell Atlantic NYNEX Mobile, Inc. (BANM) BellSouth Communications Venture Services, Inc. (CVS) Cox GTE MCI MFS"h$C0*%%ZZ""ԌNational Cable Television Association, Inc. (NCTA) Public Utilities Commission of Ohio (PUCO) Pacific Telesis Group (PTG) PaPUC Personal Communications Industry Association (PCIA) Roseville Telephone Company SBC Southern New England Telephone Company (SNET) Sprint Corporation (Sprint) Telco Planning, Inc. (Telco Planning) Telecommunications Resellers Association (TRA) TCG USTA U S WEST, Inc. (U S WEST).  X ' Replies, filed by December 5, 1996: Airtouch Ameritech AT&T BellSouth Cox GTE MCI MFS NYNEX Omnipoint Paging Network PCIA SBC TCG USTA.  X ' " D0*%%ZZ}" Parties filing comments in response to the Massachusetts DPU Petition:  X4 AT&T BANM New England Cable Television Association, Inc. (NECTA) PageNet ProNet, Inc. (ProNet) Southwestern Bell Mobile Systems, Inc. (SWBMS) TCG "1E0*%%ZZ"  X' Parties filing comments in response to the NYDPS Petition for Stay: MCI Telecommunications Corporation (MCI) Nextel Communications, Inc. (Nextel) Bell Atlantic Massachusetts Department of Public Utilities (DPU)  X_' Parties filing reply comments to the NYDPS Petition for Stay: Nextel Communications, Inc. (Nextel) New York Department of Public Service (NYDPS)  X ' Parties filing comments to the NYDPS Application Petition for Review: Massachusetts Department of Public Utilities (DPU) State of Minnesota Public Utilities Commission State of Maine Public Utilities Commission "yF0*%%ZZ"  X4U APPENDIX B ă  AMENDMENTS TO THE CODE OF FEDERAL REGULATIONS Title 47 of the CFR, Part 52 is amended as follows:  Xv' PART 52 NUMBERING  XH41.The authority citation for Part 52 continues to read as follows:  xAuthority: Sections 1, 2, 4, 5, 48 Stat. 1066, as amended; 47 U.S.C.  151, 152, 154, 155  x}unless otherwise noted. Interpret or apply secs. 3, 4, 20105, 20709, 218, 2257, 2512, 271 and  x332, 48 Stat. 1070, as amended, 1077; 47 U.S.C.  153, 154, 20105, 20709, 218, 2257, 2512, 271 and 332 unless otherwise noted.  X 42.Remove  52.19(c)(3)(iii)  Xy43.Revise  52.19(c)(3) to read as follows: ***** (c) (3)***  x(i) No area code overlay may be implemented unless all central office codes in the new overlay  xcarea code are assigned to those entities requesting assignment on a firstcome, firstserve basis,  xregardless of the identity of, technology used by, or type of service provided by that entity. No  xVgroup of telecommunications carriers shall be excluded from assignment of central office codes  xin the existing area code, or be assigned such codes only from the overlay area code, based solely  x"on that group's provision of a specific type of telecommunications service or use of a particular technology; and,   x(ii) No area code overlay may be implemented unless there exists, at the time of implementation,  x+mandatory tendigit dialing for every telephone call within and between all area codes in the geographic area covered by the overlay area code." G0*%%ZZ"  X4U APPENDIX C  X'SUPPLEMENTAL FINAL REGULATORY FLEXIBILITY ANALYSIS ă  X4 e B I. 1. a.(1)(a) i) a)k I. 1. a a.(1)(a) i) a)1. ` ` As required by the Regulatory Flexibility Act (RFA), 5 U.S.C. 603, an Initial  X4 xRegulatory Flexibility Analysis (IRFA) was incorporated in the NPRM in CC Docket No. 96 Xx4 x98.Qx {O'ԍ Id. at 1426566,  27487.Q The Commission sought written public comment on the proposals in this NPRM, including  Xc4 xthe IRFA.GcZ {On 'ԍ Id. at 14266, 286.G In addition, a Final Regulatory Flexibility Analysis (FRFA) was incorporated in the  XL4 xLocal Competition Second Report and Order. That FRFA conformed to the RFA, as amended.xZL {O ' x ԍ See 5 U.S.C.  604. The RFA, see 5 U.S.C.  601 et. seq. has been amended by the Contract With America  xt Advancement Act of 1996, Pub. L. No. 104121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).x This present Supplemental FRFA also conforms to the RFA, as amended.  X ' e & 1.` ` Need for and Objectives of the Local Competition Second Report and Order,  e /Third Order on Reconsideration and Memorandum Opinion and Order and the Rules Adopted Herein(#`  X 4 e  2. ` ` The need for and objectives of the rule revisions adopted in the Local Competition  V4 x;Second Report and Order, Third Order on Reconsideration and Memorandum Opinion and Order  X4 xare the same as those discussed in the FRFA in the Local Competition Second Report and Order.  xIn general, these rules implement the Congressional goal of opening local exchange and exchange  xaccess markets to competition by eliminating certain operational barriers to competition. The  xcCommission promulgated rules pursuant to section 251(b)(3), (c)(5), and (e)(1) of the Act in the  X'4 xLocal Competition Second Report and Order. In this Third Order on Reconsideration and  X4 x&Memorandum Opinion and Order, we grant in part and deny in part several of the petitions filed  X4 xfor reconsideration and/or clarification of the Local Competition Second Report and Order.R {O'ԍ See supra at part III.R  xWe eliminate our requirement that an area code overlay plan include the assignment of at least  x<one central office code (NXX code) to each new telecommunications service provider that had  xno NXX codes in the area code 90 days before introduction of the new area code. We grant the  xPetition for Declaratory Ruling filed by the Commonwealth of Massachusetts Department of  xPublic Utilities to the extent that the Commission clarifies that state commissions may "takeback"  xor "grandfather" Type 2 wireless numbers when an area code undergoes a geographic split,  xEsubject to certain conditions. We also clarify the definitions of the terms "code assignment,"  x"code activation," and "code opening"; find that LECs are to assess no fees for opening NXX"GH0*%%ZZl"  xcodes; and authorize state regulatory commissions to resolve issues involving fees charged for the  xactivation of NXX codes. Finally, we affirm that our numbering administration cost recovery  xIformula is competitively neutral and that we will retain this method for the current funding year,  x/but note that in a separate proceeding we have concluded that, in order to lessen the regulatory  x+burden on all telecommunications carriers, we have consolidated and streamlined six carrier  xlreporting requirements, including numbering administration cost recovery, into one report. In  x"order to include cost recovery for the administration of the North American Numbering Plan in  xthe unified report, we concluded that the NANP cost recovery allocator should be changed to be  xIconsistent with the other reporting requirements. This requirement will begin in the billing cycle beginning March 2000.  X 4  X ' 2. ` ` Summary of Significant Issues Raised in Response to the FRFA (#`  X 4 e 3. ` ` In the FRFA, the Commission concluded that rules set forth in the Local  X 4 xCompetition Second Report and Order would have a significant impact on a number of entities,  xmany that could be small business concerns. The rules we adopted regarding numbering  x administration access apply to all LECs. These rules also affect interexchange carriers, providers  xof cellular, broadband PCS, and geographic area 800 MHz and 900 MHz specialized mobile radio  xservices, including licensees who have obtained extended implementation authorizations in the  xJ800 MHz or 900 MHz SMR services, either by waiver or under section 90.629 of the  X84 xCommission's rules.@8 yO'ԍ 47 C.F.R.  90.629.@ Our rules apply to SMR licensees only if they offer realtime, twoway  x voice service that is interconnected with the public switched network. Additional business entities  xaffected by the rules include providers of telephone toll service, providers of telephone exchange  xlservice, independent operator services providers, independent directory assistance providers,  xindependent directory listing providers, independent directory database managers, and resellers of these services.  X4 e >4. ` ` We recognized that our rules might have significant economic impacts on a  xsubstantial number of small businesses. We discussed the reporting requirements imposed in the  Xi4 xMLocal Competition Second Report and Order. Finally, we discussed the steps taken to minimize  xthe impact on small entities, consistent with our stated objectives. We concluded that our actions  X=4 xpin the Local Competition Second Report and Order would benefit small entities by facilitating their entry into the local exchange and exchange access markets.  X4 e z5. ` ` In the petitions for reconsideration and clarification considered in this Third Order  X4 x7on Reconsideration and Memorandum Opinion and Order, we received no argument or comment  X 4 xspecifically directed to the FRFA. In making the determinations reflected in this Third Order on" IX0*%%ZZ;"  X4 xReconsideration and Memorandum Opinion and Order, however, we have considered the impact  X4of actions on small entities.e {Od'ԍ See section 4 of this Supplemental FRFA, infra.e  X' e  3. ` ` Description and Estimate of the Number of Small Entities Affected by this  X'Second Order on Reconsideration (#`  Xx4 e 6. ` ` The RFA directs agencies to provide a description of and, where feasible, an  Xa4 xyestimate of the number of small entities that will be affected by rules.QaZ yOl 'ԍ 5 U.S.C.  603(b)(3), 604(a)(3).Q The RFA generally  xcdefines the term "small entity" as having the same meaning as the terms "small business," "small  X34 xorganization," and "small governmental jurisdiction."?3 yO 'ԍ 5 U.S.C.  601(6).? The RFA defines a "small business" to  X 4 xbe the same as a "small business concern" under the Small Business Act,= z yOG'ԍ 15 U.S.C.  632.= unless the  X 4 xCommission has developed one or more definitions that are appropriate to its activities.  yO'ԍ 5 U.S.C.  601(3) (incorporating by reference the definition of "small business concern" in 5 U.S.C.  632). Under  x/the Small Business Act, a "small business concern" is one that: (1) is independently owned and  xhoperated; (2) is not dominant in its field of operation; and (3) meets any additional criteria  X 4established by the Small Business Administration (SBA).=  yO 'ԍ 15 U.S.C.  632.=  X4 e 7. ` ` We have included small incumbent LECs in this Supplemental RFA analysis. As  X{4 x/noted above, a "small business" under the RFA is one that, inter alia, meets the pertinent small  Xf4 xNbusiness size standard (e.g., a telephone communications business having 1,500 or fewer  XQ4 xemployees), and "is not dominant in its field of operation."?Q*  yO,'ԍ 5 U.S.C.  601(3).? The SBA's Office of Advocacy  xucontends that, for RFA purposes, small incumbent LECs are not dominant in their field of  X#4 xoperation because any such dominance is not "national" in scope.-#  yO ' x ԍ Letter from Jere W. Glover, Chief Counsel for Advocacy, SBA, to William E. Kennard, Chairman, Federal  x Communications Commission (May 27, 1999). The Small Business Act contains a definition of "small business  {O"' x concern," which the RFA incorporates into its own definition of "small business." See 15 U.S.C.  632(a) (Small  x Business Act); 5 U.S.C.  601(3) (RFA). SBA regulations interpret "small business concern" to include the concept  xc of dominance on a national basis. 13 C.F.R.  121.102(b). Since 1996, out of an abundance of caution, the  {Ox$' x Commission has included small incumbent LECs in its regulatory flexibility analyses. Implementation of the Local"x$0*%%w$"  {O' x Competition Provisions of the Telecommunications Act of 1996, CC Docket, 9698, First Report and Order, 11 FCC Rcd 15499, 16144-45 (1996). - We have therefore included"#J"0*%%ZZ2"  xVsmall incumbent LECs in this Supplemental FRFA, although we emphasize that this RFA action has no effect on FCC analyses and determinations in other, nonRFA contexts.  X4 e 8. ` ` The most reliable source of information regarding the total numbers of certain  xcommon carrier and related providers nationwide, as well as the number of commercial wireless  X4 xentities, appears to be data the Commission publishes in its Trends in Telephone Service report." {O` ' xc ԍ FCC, Common Carrier Bureau, Industry Analysis Division, Trends in Telephone Service, Table 19.3 (February 19, 1999).  Xx4 xAccording to data in the most recent report, there are 3,528 interstate carriers.3x| {O 'ԍ Id.3 These carriers  Xa4 xinclude, inter alia, local exchange carriers, wireline carriers and service providers, interexchange  XL4 xcarriers, competitive access providers, operator service providers, pay telephone operators , providers of telephone toll service, providers of telephone exchange service, and resellers.  X 4 e K9. ` ` The SBA has defined establishments engaged in providing "Radiotelephone  xCommunications" and "Telephone Communications, Except Radiotelephone" to be small  X 4 xbusinesses when they have no more than 1,500 employees.(  {O' x ԍ 13 CFR  121.201, Standard Industrial Classification (SIC) codes 4812 and 4813. See also Executive Office  {Ob'of the President, Office of Management and Budget, Standard Industrial Classification Manual (1987).( Below, we discuss the total  xestimated number of telephone companies falling within the two categories and the number of  xsmall businesses in each, and we then attempt to refine further those estimates to correspond with the categories of telephone companies that are commonly used under our rules.  Xf4 e O 10. ` ` Although some affected incumbent local exchange carriers (ILECs) may have  x1,500 or fewer employees, we do not believe that such entities should be considered small entities  xwithin the meaning of the RFA because they are either dominant in their field of operations or  x8are not independently owned and operated, and therefore by definition not "small entities" or  x"small business concerns" under the RFA. Accordingly, our use of the terms "small entities" and  x"small businesses" does not encompass small ILECs. Out of an abundance of caution, however,  xfor regulatory flexibility analysis purposes, we will separately consider small ILECs within this  xanalysis and use the term "small ILECs" to refer to any ILECs that arguably might be defined  X4by the SBA as "small business concerns."$j  {O"' x@ ԍ 13 CFR  121.201, SIC code 4813. Since the time of the Commission's 1996 decision, Implementation of  {O#' x the Local Competition Provisions in the Telecommunications Act of 1996, First Report and Order, 11 FCC Rcd  xD 15499, 1614445 (1996), 61 FR 45476 (Aug. 29, 1996), the Commission has consistently addressed in its regulatory flexibility analyses the impact of its rules on such ILECs."KV 0*%%ZZ"Ԍ X4 e  ԙ 11. ` `    Total Number of Telephone Companies Affected. The U.S. Bureau of the  xCensus ("Census Bureau") reports that, at the end of 1992, there were 3,497 firms engaged in  X4 xproviding telephone services, as defined therein, for at least one year.  {OK' x! ԍ U.S. Department of Commerce, Bureau of the Census, 1992 Census of Transportation, Communications, and  {O'Utilities: Establishment and Firm Size, at Firm Size 1-123 (1995) (1992 Census).  This number contains  xEa variety of different categories of carriers, including local exchange carriers, interexchange  x}carriers, competitive access providers, cellular carriers, mobile service carriers, operator service  xIproviders, pay telephone operators, covered specialized mobile radio providers, and resellers. It  xVseems certain that some of these 3,497 telephone service firms may not qualify as small entities  X_4 xor small ILECs because they are not "independently owned and operated."W_$ {O4 'ԍ See generally 15 U.S.C.  632(a)(1).W For example, a  xVreseller that is affiliated with an interexchange carrier having more than 1,500 employees would  xnot meet the definition of a small business. It is reasonable to conclude that fewer than 3,497  x+telephone service firms are small entity telephone service firms or small ILECs that may be affected by the rules, herein adopted.  X 4 e  12. ` ` Wireline Carriers and Service Providers. The SBA has developed a definition  xof small entities for telephone communications companies except radiotelephone (wireless)  x8companies. The Census Bureau reports that there were 2,321 such telephone companies in  X4 xVoperation for at least one year at the end of 1992.W {O'ԍ 1992 Census, supra, at Firm Size1-123.W According to the SBA's definition, a small  xbusiness telephone company other than a radiotelephone company is one employing no more than  Xb4 x_1,500 persons.ObH yO['ԍ 13 CFR  121.201, SIC code 4813. O All but 26 of the 2,321 nonradiotelephone companies listed by the Census  xhBureau were reported to have fewer than 1,000 employees. Thus, even if all 26 of those  xNcompanies had more than 1,500 employees, there would still be 2,295 non-radiotelephone  xcompanies that might qualify as small entities or small ILECs. We do not have data specifying  xthe number of these carriers that are not independently owned and operated, and thus are unable  x[at this time to estimate with greater precision the number of wireline carriers and service  xproviders that would qualify as small business concerns under the SBA's definition.  xConsequently, we estimate that fewer than 2,295 small telephone communications companies  xother than radiotelephone companies are small entities or small ILECs that may be affected by the rules, herein adopted.  Xe4 i` `  a.  Incumbent Local Exchange Carriers. There are two principle providers of  xclocal telephone service; ILECS and competing local service providers. Neither the Commission  xnor the SBA has developed a definition for small providers of local exchange services (LECs).  x_Neither the Commission nor the SBA has developed a definition specifically directed toward""L0*%%ZZV"  xsmall incumbent LECs. The closest applicable definition under SBA rules is for telephone  xcommunications companies other than radiotelephone (wireless) companies. The most reliable  xsource of information regarding the number of LECs nationwide of which we are aware appears  xto be the data that we collect annually in connection with the Telecommunications Relay Service  x(TRS). According to our most recent data, 1,410 companies reported that they were engaged in  X4 xthe provision of local exchange services.#Afootnote reference#G {O' x& ԍ Federal Communications Commission, CarrierLocator: Interstate Service Providers, Fig. 1 (Jan. 1999)  {O'(Carrier Locator Report). Although it seems certain that some of these carriers  xare not independently owned and operated or have more than 1,500 employees, we are unable  xat this time to estimate with greater precision the number of small incumbent LECs that would  x}qualify as small business concerns under SBA's definition. Consequently, we estimate that there  xRare fewer than 1,410 small incumbent LECs that may be affected by the decisions and rules adopted in this Order._Ref463160047  X 4 ij` `  b.  Interexchange Carriers . Neither the Commission nor the SBA has  xdeveloped a definition of small entities specifically applicable to providers of interexchange  xservices (IXCs). The closest applicable definition under the SBA rules is for telephone  X 4 xcommunications companies other than radiotelephone (wireless) companies.M $ yO~'ԍ 13 CFR  121.201, SIC code 4813.M According to the  X4 xmost recent Trends in Telephone Service data, 151 carriers reported that they were engaged in  X}4 x}the provision of interexchange services.l} {O'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the number of these  xcarriers that are not independently owned and operated or have more than 1,500 employees, and  xthus are unable at this time to estimate with greater precision the number of IXCs that would  xqualify as small business concerns under the SBA's definition. Consequently, we estimate that there are fewer than 151 small entity IXCs that may be affected by the rules, herein adopted.  X4 iK` `  c. Competitive Access Providers. Neither the Commission nor the SBA has  x+developed a definition of small entities specifically applicable to competitive access services  xhproviders (CAPs). The closest applicable definition under the SBA rules is for telephone  X4 xcommunications companies other than except radiotelephone (wireless) companies.HF yO'ԍ 13 CFR 121.201, SIC code 4813.H According  X4 xto the most recent Trends in Telephone Service data, 147 carriers reported that they were engaged  X4 xin the provision of competitive local exchange services.l {O #'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the  xnumber of these carriers that are not independently owned and operated, or have more than 1,500  x8employees, and thus are unable at this time to estimate with greater precision the number of"VMh 0*%%ZZ"  xICAPs that would qualify as small business concerns under the SBA's definition. Consequently,  xVwe estimate that there are fewer than 147 small entity CAPs that may be affected by the rules, herein adopted.  X4 i` `  d.    Operator Service Providers. Neither the Commission nor the SBA has  xdeveloped a definition of small entities specifically applicable to providers of operator services.  xThe closest applicable definition under the SBA rules is for telephone communications companies  Xa4 xEother than radiotelephone (wireless) companies.Ma yO'ԍ 13 CFR  121.201, SIC code 4813.M According to the most recent Trends in  XL4 xTelephone Service data, 32 carriers reported that they were engaged in the provision of operator  X74 xqservices.l7X {O@ 'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the number of these carriers that are not  xindependently owned and operated or have more than 1,500 employees, and thus are unable at  x<this time to estimate with greater precision the number of operator service providers that would  xqualify as small business concerns under the SBA's definition. Consequently, we estimate that  xthere are fewer than 32 small entity operator service providers that may be affected by the rules, herein adopted.  X4 i-` `  e. Pay Telephone Operators. Neither the Commission nor the SBA has  xdeveloped a definition of small entities specifically applicable to pay telephone operators. The  xclosest applicable definition under SBA rules is for telephone communications companies other  XS4 x than radiotelephone (wireless) companies.MS yO'ԍ 13 CFR  121.201, SIC code 4813.M According to the most recent Trends in Telephone  X>4 xlService data, 509 carriers reported that they were engaged in the provision of pay telephone  X)4 xqservices.l)z {OT'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the number of these carriers that are not  xindependently owned and operated or have more than 1,500 employees, and thus are unable at  xthis time to estimate with greater precision the number of pay telephone operators that would  xqualify as small business concerns under the SBA's definition. Consequently, we estimate that  x}there are fewer than 509 small entity pay telephone operators that may be affected by the rules, herein adopted.  X4 iO` `  f. Resellers (including debit card providers). Neither the Commission nor the  xISBA has developed a definition of small entities specifically applicable to resellers. The closest  xapplicable SBA definition for a reseller is a telephone communications company other than  XE4 xradiotelephone (wireless) companies.ME  yO%'ԍ 13 CFR  121.201, SIC code 4813.M According to the most recent Trends in Telephone"EN0*%%ZZl"  X4 x}Service data, 358 reported that they were engaged in the resale of telephone service.l  {Oy'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do  x+not have data specifying the number of these carriers that are not independently owned and  xoperated or have more than 1,500 employees, and thus are unable at this time to estimate with  xgreater precision the number of resellers that would qualify as small business concerns under the  xSBA's definition. Consequently, we estimate that there are fewer than 358 small entity resellers that may be affected by the rules, herein adopted.  Xa4 i` `  g.  800 and 800Like Service Subscribers.~aZ  yOl 'ԍ We include all tollfree number subscribers in this category, including 888 numbers.~ Neither the Commission nor the  xSBA has developed a definition of small entities specifically applicable to 800 and 800like  xservice ("toll free") subscribers. The most reliable source of information regarding the number  xof these service subscribers appears to be data the Commission collects on the 800, 888, and 877  X 4 xnumbers in use.   {O' x ԍ FCC, CCB Industry Analysis Division, FCC Releases, Study on Telephone Trends, Tbls. 21.2, 21.3 and 21.4 (February 19, 1999). According to our most recent data, at the end of January 1999, the number  xof 800 numbers assigned was 7,692,955; the number of 888 numbers that had been assigned was  x7,706,393; and the number of 877 numbers assigned was 1,946,538. We do not have data  x@specifying the number of these subscribers that are not independently owned and operated or have  xmore than 1,500 employees, and thus are unable at this time to estimate with greater precision  xthe number of toll free subscribers that would qualify as small business concerns under the SBA's  xdefinition. Consequently, we estimate that there are fewer than 7,692,955 small entity 800  xsubscribers, fewer than 7,706,393 small entity 888 subscribers, and fewer than 1,946,538 small entity 877 subscribers may be affected by the rules, herein adopted.  X!4 13.` ` Wireless and Commercial Mobile Services  X4 i` `  a. Cellular Licensees. Neither the Commission nor the SBA has developed  x"a definition of small entities applicable to cellular licensees. Therefore, the applicable definition  xof small entity is the definition under the SBA rules applicable to radiotelephone (wireless)  xcompanies. This provides that a small entity is a radiotelephone company employing no more  X4 xthan 1,500 persons.OD  yO 'ԍ 13 CFR  121.201, SIC code 4812. O According to the Bureau of the Census, only twelve radiotelephone firms  X4 xfrom a total of 1,178 such firms which operated during 1992 had 1,000 or more employees.h  {O#'ԍ 1992 Census, Series UC92S1, at Table 5, SIC code 4812.h  xTherefore, even if all twelve of these firms were cellular telephone companies, nearly all cellular  xcarriers were small businesses under the SBA's definition. In addition, we note that there are  x1,758 cellular licenses; however, a cellular licensee may own several licenses. In addition,"=Of  +&&ZZ"  X4 xaccording to the most recent Trends in Telephone Service data, 732 carriers reported that they  xlwere engaged in the provision of either cellular service or Personal Communications Service  X4 x(PCS) services, which are placed together in the data.l  {OM'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the  xnumber of these carriers that are not independently owned and operated or have more than 1,500  x8employees, and thus are unable at this time to estimate with greater precision the number of  xcellular service carriers that would qualify as small business concerns under the SBA's definition.  xConsequently, we estimate that there are fewer than 732 small cellular service carriers that may be affected by the rules, herein adopted.  X34 ir` `  b. 220 MHz Radio Service Phase I Licensees.  The 220 MHz service has  xboth PhaseI and PhaseII licenses. Phase I licensing was conducted by lotteries in 1992 and  xh1993. There are approximately 1,515 such non-nationwide licensees and four nationwide  x[licensees currently authorized to operate in the 220 MHz band. The Commission has not  xdeveloped a definition of small entities specifically applicable to such incumbent 220 MHZ Phase  xI licensees. To estimate the number of such licensees that are small businesses, we apply the  xdefinition under the SBA rules applicable to Radiotelephone Communications companies. This  xdefinition provides that a small entity is a radiotelephone company employing no more than 1,500  X}4 xpersons.w}Z  yO'ԍ 13 C.F.R.  121.201, Standard Industrial Classification (SIC) code 4812. w According to the Bureau of the Census, only 12 radiotelephone firms out of a total  Xf4 x/of 1,178 such firms which operated during 1992 had 1,000 or more employees.AXf  yO' x ԍ U.S. Bureau of the Census, U.S. Department of Commerce, 1992 Census of Transportation,  x Communications, and Utilities, UC92-S-1, Subject Series, Establishment and Firm Size, Table 5, Employment Size of Firms; 1992, SIC code 4812 (issued May 1995).A Therefore, if  xthis general ratio continues in 1999 in the context of PhaseI 220 MHz licensees, we estimate that nearly all such licensees are small businesses under the SBA's definition.  X 4 i` `  c. 220 MHz Radio Service PhaseII Licensees. The PhaseII 220 MHz  X4 xservice is a new service, and is subject to spectrum auctions. In the 220 MHz Third Report and  X4 x}Order, we adopted criteria for defining small businesses and very small businesses for purposes  xof determining their eligibility for special provisions such as bidding credits and installment  X4 xVpayments.   yOo 'ԍ 220 MHz Third Report and Order, 12 FCC Rcd 10943, 11068-70, at paras. 291-295 (1997). We have defined a small business as an entity that, together with its affiliates and  xcontrolling principals, has average gross revenues not exceeding $15 million for the preceding  x8three years. Additionally, a very small business is defined as an entity that, together with its  x}affiliates and controlling principals, has average gross revenues that are not more than $3 million  XX4 xtfor the preceding three years.VX  {O%'ԍ Id., 12 FCC Rcd at 11068-69,  291.V The SBA has approved these definitions.X,   {O' x  ԍ See Letter from A. Alvarez, Administrator, SBA, to D. Phythyon, Chief, Wireless Telecommunications Bureau, FCC (Jan. 6, 1998). An auction of Phase"XP" +&&ZZ"  X4 xII licenses commenced on September 15, 1998, and closed on October 22, 1998."  {O' x^ ԍ See generally Public Notice, "220 MHz Service Auction Closes," Report No. WT 98-36 (Wireless Telecom. Bur. Oct. 23, 1998). Nine hundred  x}and eight (908) licenses were auctioned in 3   different-sized geographic areas: three nationwide  xIlicenses, 30 Regional Economic Area Group Licenses, and 875 Economic Area (EA) Licenses.  xOf the 908 licenses auctioned, 693 were sold. Companies claiming small business status won:  xIone of the Nationwide licenses, 67% of the Regional licenses, and 54% of the EA licenses. As  x/of January 22, 1999, the Commission announced that it was prepared to grant 654 of the Phase  Xv4 xII licenses won at auction.v|  yO ' xx ԍ Public Notice, "FCC Announces It is Prepared to Grant 654 Phase II 220 MHz Licenses After Final Payment is Made," Report No. AUC18H, DA No. 99229 (Wireless Telecom. Bur. Jan. 22, 1999). A reauction of the remaining, unsold licenses is likely to take place during calendar year 1999.  X14 i` `  d. Private and Common Carrier Paging.  The Commission has proposed a  xtwotier definition of small businesses in the context of auctioning licenses in the Common  xCarrier Paging and exclusive Private Carrier Paging services. Under the proposal, a small  xEbusiness will be defined as either (1) an entity that, together with its affiliates and controlling  xprincipals, has average gross revenues for the three preceding years of not more than $3 million,  xor (2) an entity that, together with affiliates and controlling principals, has average gross revenues  x/for the three preceding calendar years of not more than $15 million. Because the SBA has not  xyyet approved this definition for paging services, we will utilize the SBA's definition applicable  X{4 xto radiotelephone companies, i.e., an entity employing no more than 1,500 persons.M{  yO'ԍ 13 CFR  121.201, SIC code 4812.M At present,  x+there are approximately 24,000 Private Paging licenses and 74,000 Common Carrier Paging  XO4 xlicenses. According to the most recent Trends in Telephone Service data, 137 carriers reported  xthat they were engaged in the provision of either paging or "other mobile" services, which are  X#4 xplaced together in the data.l#d   {O8'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).l We do not have data specifying the number of these carriers that  x_are not independently owned and operated or have more than 1,500 employees, and thus are  xunable at this time to estimate with greater precision the number of paging carriers that would  xqualify as small business concerns under the SBA's definition. Consequently, we estimate that  xythere are fewer than 137 small paging carriers that may be affected by the proposed rules, if  xadopted. We estimate that the majority of private and common carrier paging providers would qualify as small entities under the SBA definition. "Q  +&&ZZ"Ԍ X4 i` `  e.  Mobile Service Carriers.  Neither the Commission nor the SBA has  x<developed a definition of small entities specifically applicable to mobile service carriers, such as  xpaging companies. As noted above in the section concerning paging service carriers, the closest  X4 xcapplicable definition under the SBA rules is that for radiotelephone (wireless) companies,M  yO6'ԍ 13 CFR  121.201, SIC code 4812.M and  X4 xZthe most recent Trends in Telephone Service data shows that 23 carriers reported that they were  X4 x/engaged in the provision of SMR dispatching and "other mobile" services.fX  yO'ԍ Trends in Telephone Service, Table 19.3 (February 19, 1999).f   Consequently, we  x/estimate that there are fewer than 23 small mobile service carriers that may be affected by the rules, herein adopted.  X54  i\` `  f. Broadband Personal Communications Service (PCS). The broadband PCS  xspectrum is divided into six frequency blocks designated A through F, and the Commission has  xheld auctions for each block. The Commission defined "small entity'' for Blocks C and F as an  x_entity that has average gross revenues of less than $40 million in the three previous calendar  X 4 xyyears.^   {Ot' x ԍ See Amendment of Parts 20 and 24 of the Commission's Rules Broadband PCS Competitive Bidding and  {O>' x the Commercial Mobile Radio Service Spectrum Cap, Report and Order, FCC 96278, WT Docket No. 9659, paras.  {O'57 60 (released Jun. 24, 1996), 61 FR 33859 (Jul. 1, 1996); see also 47 CFR  24.720(b). For Block F, an additional classification for "very small business" was added and is  xdefined as an entity that, together with their affiliates, has average gross revenues of not more  X 4 xRthan $15 million for the preceding three calendar years.P\   {Ol' x ԍ See Amendment of Parts 20 and 24 of the Commission's Rules Broadband PCS Competitive Bidding and  {O6' xk the Commercial Mobile Radio Service Spectrum Cap, Report and Order, FCC 96278, WT Docket No. 9659,  60 (1996), 61 FR 33859 (Jul. 1, 1996).P These regulations defining "small  X4 xcentity'' in the context of broadband PCS auctions have been approved by the SBA.2   {Oy' xk ԍ See, e.g., Implementation of Section 309(j) of the Communications Act Competitive Bidding, PPDocket No.93253, Fifth Report and Order, 9 FCC Rcd 5532, 558184 (1994). No small  x/businesses within the SBAapproved definition bid successfully for licenses in Blocks A and B.  xThere were 90 winning bidders that qualified as small entities in the Block C auctions. A total  xof 93 small and very small business bidders won approximately 40% of the 1,479 licenses for  X:4 xBlocks D, E, and F.:   {Ow 'ԍ FCC News, Broadband PCS, D, E and F Block Auction Closes, No. 71744 (released Jan. 14, 1997). Based on this information, we conclude that the number of small  xbroadband PCS licensees will include the 90 winning C Block bidders and the 93 qualifying  xVbidders in the D, E, and F blocks, for a total of 183 small entity PCS providers as defined by the SBA and the Commission's auction rules.  X4 i` `  g. Narrowband PCS.  The Commission has auctioned nationwide and regional  x licenses for narrowband PCS. There are 11 nationwide and 30 regional licensees for narrowband"R +&&ZZ\"  x/PCS. The Commission does not have sufficient information to determine whether any of these  xlicensees are small businesses within the SBAapproved definition for radiotelephone companies.  xAt present, there have been no auctions held for the major trading area (MTA) and basic trading  xarea (BTA) narrowband PCS licenses. The Commission anticipates a total of 561 MTA licenses  xand 2,958 BTA licenses will be awarded by auction. Such auctions have not yet been scheduled,  xhowever. Given that nearly all radiotelephone companies have no more than 1,500 employees  xand that no reliable estimate of the number of prospective MTA and BTA narrowband licensees  xcan be made, we assume, for purposes of this IRFA, that all of the licenses will be awarded to small entities, as that term is defined by the SBA.  X 4 i` `  h.  Rural Radiotelephone Service.  The Commission has not adopted a  X 4 xdefinition of small entity specific to the Rural Radiotelephone Service.  yO~ 'ԍ The service is defined in Section 22.99 of the Commission's Rules, 47 CFR  22.99. A significant subset  X 4 xof the Rural Radiotelephone Service is the Basic Exchange Telephone Radio Systems (BETRS). X yO'ԍ BETRS is defined in Sections 22.757 and 22.759 of the Commission's Rules, 47 CFR  22.757 and 22.759.  X 4 xWe will use the SBA's definition applicable to radiotelephone companies, i.e., an entity  X 4 xcemploying no more than 1,500 persons.O  yO['ԍ 13 CFR  121.201, SIC code 4812. O There are approximately 1,000 licensees in the Rural  xRadiotelephone Service, and we estimate that almost all of them qualify as small entities under the SBA's definition.  Xf4 i` `  i. AirGround Radiotelephone Service. The Commission has not adopted a  XQ4 x}definition of small entity specific to the AirGround Radiotelephone Service.Qx yOz'ԍ The service is defined in Section 22.99 of the Commission's Rules, 47 CFR  22.99. Accordingly, we  X:4 xwill use the SBA's definition applicable to radiotelephone companies, i.e., an entity employing  X%4 xuno more than 1,500 persons.M% yO'ԍ 13 CFR  121.201, SIC code 4812.M There are approximately 100 licensees in the AirGround  x}Radiotelephone Service, and we estimate that almost all of them qualify as small under the SBA definition.  X4 i` `  j. Specialized Mobile Radio (SMR). The Commission awards bidding credits  xin auctions for geographic area 800 MHz and 900 MHz SMR licenses to firms that had revenues  X4 xof no more than $15 million in each of the three previous calendar years.D yO"'ԍ 47 CFR  90.814(b)(1). D In the context of 900  xMHz SMR, this regulation defining "small entity" has been approved by the SBA; approval  xVconcerning 800 MHz SMR is being sought. For geographic area licenses in the 900 MHz SMR"oS( 0*%%ZZ "  X4 xband, there are 60 who qualified as small entities. For the 800 MHz SMR's, 38 are small or very small entities.  X' e )"6Afootnote reference)#Afootnote reference# 4.` ` Summary Analysis of the Projected Reporting, Recordkeeping and Other  e Compliance Requirements and Steps Taken to Minimize the Significant  X4 e Economic Impact of this Third Order on Reconsideration and Memorandum  Xw4 e cOpinion and Order on Small Entities, Including the Significant Alternatives  Xa'Considered and Rejected (#`  X34 e  14. ` ` Summary of Projected Reporting, Recordkeeping and Other Compliance  X 4 x3Requirements. In the Local Competition Second Report and Order the Commission authorized  xIstate commissions to perform the tasks of implementing new area codes subject to Commission  xguidelines. If a state commission chooses initiate and plan area code relief, it must inform the  xNANP Administrator of the functions the commission will perform. The Commission also noted  xythat all telecommunications carriers were to contribute to the costs of establishing numbering  X 4 xZadministration. In this Third Order on Reconsideration and Memorandum Opinion and Order  xwe eliminated our provision that a state commission may choose to implement an allservice area  xcode overlay plan only when the plan included the assignment, during the 90day period  xNpreceding the introduction of that overlay, of at least one NXX code to each new entrant telecommunications service provider.  X%4 e 15..` ` Steps Taken to Minimize Significant Economic Impact on Small Entities. In this  X4 xOrder we eliminated our requirement that each new entrant telecommunications service provider  x/that has no NXXs receive at least one NXX code because we found that it created uncertainty  x"in the area code relief planning process and might spur depletion of numbering resources. This  xuncertainty and depletion might have placed a significant economic and administrative burden  xupon small carriers, incumbent LECs, and competing service providers seeking to compete in the  xlocal telecommunications exchange market. We also have allowed wireless carriers, which may  xinclude small business entities, to grandfather numbers in the event of a geographic area code  xcsplit. This gives wireless carriers more time to educate their customers. Moreover, as wireless  xcompanies must physically reprogram the telephones in the area receiving the new area code, our  x}policy allows these companies to minimize this economic impact by allowing to forbear from this  x/requirement. In addition, we emphasized that LECs were not to charge discriminatory fees for  xNXX code assignment, NXX code activation, or NXX code opening. This should benefit small  x+entities because we believe that such fees would disproportionately burden small carriers or business entities seeking to compete with incumbent LECs and other established carriers.  X!' 5.` ` Report to Congress  X#4 e  16. ` ` The Commission will send a copy of this Third Order on Reconsideration and  Xv$4 xcMemorandum Opinion and Order, including this Supplemental FRFA, in a report to be sent to"v$T0*%%ZZ""  X4 xCongress pursuant to the Small Business Regulatory Enforcement Fairness Act of 1996, see 5  X4 xU.S.C.  801(a)(1)(A). In addition, the Commission will send a copy of this Third Order on  X4 xReconsideration and Memorandum Opinion and Order, including Supplemental FRFA, to   the  X4 xChief Counsel for Advocacy of the Small Business Administration. A copy of this Third Order  X4 xon Reconsideration and Memorandum Opinion and Order and Supplemental FRFA (or summaries  X4thereof) will also be published in the Federal Register. See 5 U.S.C.  604(b).