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1 Control Number : Item Number : 262 Addendum StartPage : 0

2 A Limited Liability Partnership Post Office Box Austin, Texas Telephone ( 512) Fax (512) February 16, 2011 Hon. Barry Smitherman, Chairman Hon. Donna L. Nelson, Commissioner Hon. Kenneth W. Anderson, Jr., Commissioner Public Utility Commission of Texas 1701 N. Congress Austin, Texas ^,. ; Re: Docket No ; Petition of UTEX Communications Corporation for Arbitration Pursuant to Section 252(b) of the Federal Telecommunications Act and PURA for Rates, Terms, and Conditions of Interconnection Agreement with Southwestern Bell Telephone Company Dear Commissioners: Pursuant to P.U.C. Procedural Rule 21.75(b)(1)(G), Verizon Southwest ("Verizon") files its comments regarding the need for reconsideration of the Arbitration Award issued in the aforementioned docket. Specifically, the Arbitration Award does not address the July 21 and October 7, 2010 letters filed in this docket by Verizon requesting the inclusion of certain language in the Arbitration Award. Specifically, Verizon requested that any Arbitration Award regarding intercarrier compensation for VoIP traffic contain explicit language to make clear that the Commission's decision: (1) applies only to the parties of the arbitration; and (2) is based on the specific facts presented and arguments made by those parties. Verizon also noted that language should be included in the Arbitration Award to explicitly recognize that, until the FCC addresses the particular intercarrier compensation that applies to VoIP traffic,' VoIP compensation arrangements remain subject to negotiation on a case-by-case basis. The Arbitration Award issued in the docket fails to acknowledge Verizon's requested language or offer an explanation as to why the request should be denied. In its letters, Verizon explained how its proposal would encourage voluntary negotiations on VoIP intercarrier compensation. By letter dated July 30, 2010, an association of 38 small telephone companies supported Verizon's request. For your convenience, Verizon is attaching the referenced correspondence to this letter. Consistent with these comments, Verizon Last week, the FCC stated that it intends to address the issue of intercarrier compensation obligations for VoIP traffic in the near term, on an expedited schedule, ahead of comprehensive reform of the existing intercarrier compensation system. Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking, Connect America Fund, etc., FCC 11-13, (Feb. 9, 2011). 98 San Jacinto Boulevard, Suite 1450, Austin, Texas ^^ 2

3 A Limited liability Partnership February 16, 2011 Page 2 respectfully requests that the Commission revise the Arbitration Award to include Verizon's proposed language. submitted, AMC/ltr Attachments M. Coffin cc: Meena Thomas, Arbitrator David B. Smithson, Arbitrator All Parties of Record

4 A Limited Liability Partnership Post Office Box Austin, Texas Telephone (512) Fax (512) , ;L;,^:_; i.!l:f^ July 21, , Meena Thomas Patrick H. Peters, III David B. Smithson Arbitrators 1701 N. Congress Austin, Texas Re: Docket No ; Petition of UTEX Communications Corporation for Arbitration Pursuant to Section 252(b) of the Federal Telecommunications Act and PURA for Rates, Terms, and Conditions of Interconnection Agreement with Southwestern Bell Telephone Company Dear Arbitrators: Verizon Southwest ("Verizon") is not a party to this, arbitration between AT&T and UTEX, and Verizon takes no substantive position on the issues in the arbitration. Verizon submits this letter in the nature of an amicus filing, to emphasize the potential industry ramifications of a decision that is not sufficiently narrowly crafted. Verizon respectfully suggests that any proposed order in this docket explicitly state that any conclusions reached in the arbitration award here relating to the treatment of VoIP traffic apply only to the parties to this arbitration and are based on the specific facts presented and the arguments made by these parties. Any order also should explicitly recognize that, until the FCC specifically addresses the particular intercarrier compensation that applies to VoIP traffic, VoIP compensation arrangements remain subject to negotiation on a case-by-case basis. This approach would be consistent with the Commission's decision in April that it was not necessary to address issues concerning the regulatory treatment of VoIP services on a generic basis before arbitrating the specific VoIP-related issues. in dispute in this bilateral arbitration. And this approach would help to avoid any potentially harmful (and unintended) consequences of a broader ruling on a variety of issues that may not have been addressed fully in the context of the narrow dispute between the parties here. Among other things, a narrow resolution of the particular disputes between the parties to the arbitration is essential to avoid chilling voluntary negotiations between carriers with respect to intercarrier compensation for VoIP. Because the FCC has yet to adopt intercarrier compensation rules directly applicable to VoIP traffic, VoIP compensation is currently subject to negotiation on a case-by-case basis. Such voluntarily negotiated agreements are the best way to resolve thorny intercarrier compensation issues, so it is important to avoid rulings that might be 98 San Jacinto Boulevard, Suite 1450, Austin, Texas 78701

5 A limited liability Partnership July 21, 2010 Page 2 broadly construed to undermine carriers' incentives and ability to enter such agreements. A narrow ruling resolving the specific dispute here will also preserve the full range of policy options available to the Commission in potential future cases. It would explicitly recognize that the Commission's policy choices in other cases, when presented with different options or involving different or broader considerations, may differ from the choices it makes in this arbitration, on'this particular record. We understand that this arbitration involves a narrow dispute between two parties and that any order resolving that specific dispute necessarily will not create a rule of general applicability. Nevertheless, given the potentially broad ramifications for the industry as a whole, and in order to ensure there is no confusion on this point, we respectfully suggest that any order in this proceeding explicitly so state. AMC/ltr

6 A Limited Liability Partnership Post Office Box Austin, Texas Telephone (512) Fax (512) October 7, 2010 Hon. Meena Thomas, Arbitrator Hon. Patrick H. Peters III, Arbitrator Hon. David S. Smithson, Arbitrator Public Utility Commission of Texas 1701 N. Congress Austin, Texas ti Re: Docket No ; Petition of UTEX Communications Corporation for Arbitration Pursuant to Section 252(b) of the Federal Telecommunications Act and PURA for Rates, Terms, and Conditions of Interconnection Agreement with Southwestern Bell Telephone Company Dear Arbitrators: These comments on the Proposal for Award ("PFA") are submitted jointly by Verizon Southwest ("Verizon") and the Voice on the Net Coalition ("VON"), which represents the nation's leading companies developing and delivering voice innovations over the Internet.l Verizon and VON request that any final order in this docket regarding intercarrier compensation for VoIP traffic explicitly state that it applies only to the parties to this arbitration and is based on the specific facts presented and arguments made by these parties. Also, any final order should explicitly recognize that, until the FCC addresses the particular intercarrier compensation that applies to VoIP traffic, VoIP compensation arrangements remain subject to negotiation on a case-by-case basis. Verizon made this request, and explained how its proposal would encourage voluntary negotiations on VoIP intercarrier compensation, in a letter to the arbitrators dated July 21, On July 30, an association of 38 small telephone companies filed a letter supporting Verizon's request.2 Neither AT&T nor UTEX opposed the request. Indeed, in a recent filing with the 'The Voice on the Net or VON Coalition consists of leading VoIP companies, on the cutting edge of developing and delivering voice innovations over the Internet. The coalition works to advance regulatory policies that enable Americans to take advantage of the full promise and potential of VoIP. The Coalition believes that with the right public policies, Internet based voice advances can make talking more affordable, businesses more productive, jobs more plentiful, the Internet more valuable, and Americans more safe and secure. Since its inception, the VON Coalition has promoted pragmatic policy choices for unleashing VoIP's potential. 2 TSCTI Letter to the Arbitrators (docketed Aug. 2, 2010). 98 San Jacinto Boulevard, Suite 1450, Austin, Texas ^^o

7 A Limited Liability Partnership October 7, 2010 Page 2 FCC, UTEX appeared to agree with Verizon "that this is a bilateral arbitration that will bind only AT&T and UTEX to the resulting terms."3 In addition to the reasons set forth in Verizon's July 21 letter, the proposed language is essential given the unique (and confusing) facts of this case. For example, as the PFA points out in several places, UTEX's allegation and arguments are far from clear: "UTEX has consistently been vague about how traffic reaches its network" (PFA at 46); UTEX's witness stated that the communications between UTEX and its ESP customers "may or may not move through the public or private Internet depending on what the media is." (Id.) In fact, it appears that UTEX may, at least in some instances, be providing nothing more than "IP in the middle" (as the FCC has defined it) in transporting traffic from its end users to AT&T. (See, e.g., PFA at 48.) If so, it is not transporting VoIP traffic, and therefore VoIP intercarrier compensation is not at issue. In any event, given the confusing and ill-defined positions in this docket, the Commission should make clear it is not establishing any precedent. In sum, Verizon and VON understand that this arbitration is between two parties and will not create a rule of general applicability. Nevertheless, to make the record absolutely clear on this point, Verizon and VON respectfully request that any final order explicitly recognize that the conclusions reached in that order apply only to the parties to the arbitration and are based on the specific facts presented and the arguments made by these parties. Ann Glenn S. Richards Executive Director Voice on the Net Coalition c/o Pillsbury Winthrop Shaw Pittman LLP 2300 N St., NW Washington, DC cc: Chairman Barry Smitherman Commissioner Donna L. Nelson Commissioner Kenneth W. Anderson, Jr. ~3 UTEX Petition for Preemption, WC Docket No , UTEX Reply Comments 17 (Aug. 23, 2010).

8 RICHARDS, ELDER & GREEN, L.L.P. DON R. R[cHARns Board Certrfied Admmrstraave!aw Texas Board ojlegd Specialization DULAN D. ELDER Board Certified Re,sidentra! Real Estate faw. Commercial Real state Law. Farm & Ranch Real Estate Law Texas Board ojlegaf Specialization Ms. Meena Thomas Mr. Patrick H. Peters, III Mr. David B. Smithson Arbitrators 1701 N. Congress Ave. Austin, Texas ATTORNEYS AT LAW 3223 SouTH Loop 289, SUITE 424 (74923) P.O. Box LUBBOCK, TEXAS aEPHOrE: TEr.ECOPY: July 30, 2010 a. ^' ` ilk y 4 ^, RoBiN M. GREEN Board C.ertrfied. Civil Trial Texas Board of LeBrr! Specialization RECEf^ QUG BY D. DAxiE[. Giasox CARIL.SCHOVAJSA RE: Docket 26381; Petition of UTEX Communications Corporation forarbitration Pursuant to Section 252 (b) of the Federal Telecommunications Act and PURA for Rates, Terms, and Conditions of Interconnection Agreement with Southwestern Bell Telephone Company Dear Arbitrators: Texas Statewide Telephone Cooperative, Inc. ("TSTCI"), Amicus curiae herein, is a statewide association whose members are 38 ofthe small independent and cooperative telephone companies which provide basic telecommunication services into the vast farm and ranch rural areas of the state of Texas. Each of the TSTCI members is licensed and certificated by the PUC to provide telecommunication service into specific geographic areas. While TSTCI represents small companies in terms of percentage of total telephone access lines in service in the state, these same companies provide service to more than one-third of the total geographic area of the state. TSTCI is not a party to this arbitration and takes no substantive position on the issues in the arbitration. TSTCI files these amicus curiae comments to stress the importance of a decision tailored to apply specifically to the parties to this arbitration and avoid unintended industry-wide impact. TSTCI has reviewed the recent filings in this case and agrees with the amicus curiae letter filing of Verizon Southwest ("Verizon"). TSTCI joins Verizon in urging that any conclusions reached in the arbitration award relating to the treatment of VoIP traffic should apply only to the parties to the arbitration and be based on the specific facts presented and arguments made by the parties. In order to avoid any confusion or unintended industry wide consequences, any proposed order should explicitly recognize that no industry wide policy decisions are being made in the resolution of this arbitration, and that such policy decisions are better suited for forums with wider industry participation. TSTCI thanks the Arbitrators for consideration of these amicus curiae comments. Respectfully submitted, Richards, Elder & Green, L.L.P. By D. Daniel Gibson Attorneys for Texas Statewide Telephone Cooperative, Inc. cc: Central Records Filing Clerk Parties of Record ^

Addendum StartPage: 0

Addendum StartPage: 0 Control Number : 39717 Item Number : 29 Addendum StartPage: 0 PROJECT NO. 39717 cz * s; ^^1^,jA lt RULEMAKING PROCEEDING PUBLIC UTILITY COMNIISj^; RELATED TO VOICE OVER INTERNET PROTOCOL (VoIP) OF TEXAS

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