1. T-Mobile | stick together
Saturday, April 01, 2017
Special Access
Dave Conn
Nat. Director, State Regulatory
T-Mobile USA
Bellevue, WA
Presentation to NARUC Staff Subcommittee on Telecommunications
July 14, 2007

2. Special Access Regulatory Framework
T-Mobile | stick together
Saturday, April 01, 2017
Special Access Regulatory Framework
Two alternate regulatory processes used for Price Cap carriers:
Phase I pricing flexibility allows contract tariffs, and term and volume discounts, but must maintain availability of price-cap tariffed offerings
Phase II allows services to be offered free of constraints imposed by Part 69 (rate structure) and Part 61 (price caps)
Determinations of whether "triggers" for alternate treatment have been met are made at the MSA level
Triggers are intended to be a measurement of competition within the MSA
If triggers are met, competition is assumed to be sufficient to constrain market power within the MSA
Different triggers for:
Channel terminations (dedicated circuit between LEC end office and customer premises)
Dedicated transport services

3. Special Access Regulatory Framework
T-Mobile | stick together
Saturday, April 01, 2017
Special Access Regulatory Framework
Triggers for Channel Terminations:
Phase I pricing flexibility allowed if unaffiliated competitors:
are collocated at 50+% LEC's wire centers within the MSA; or
are collocated at wire centers accounting for at least 65% of the revenue within the MSA of the allows contract tariffs, and term and volume discounts, but must maintain availability of price-cap tariffed offerings
Phase II pricing flexibility allowed if unaffiliated competitors:
are collocated at 65+% LEC's wire centers within the MSA; or
are collocated at wire centers accounting for at least 85% of the revenue within the MSA of the allows contract tariffs, and term and volume discounts, but must maintain availability of price-cap tariffed offerings
Triggers for Dedicated Transport:
are collocated at 15+% LEC's wire centers within the MSA; or
are collocated at wire centers accounting for at least 30% of the revenue within the MSA of the allows contract tariffs, and term and volume discounts, but must maintain availability of price-cap tariffed offerings

4. Special Access: Why T-Mobile Cares Illustrative Network Design
Cell Site
Cell Site
Cell Site
DS1s
96% of links to cell sites purchased from ILECs CO
68% of Interoffice Transport links (Tandem to MSC) are purchased from ILECs
DS1s
(and sometimes DS3s)
94% of Interoffice Transport links (CO to Tandem) purchased from ILECs
DS3
Tandem
MSC

5. Special Access: Why T-Mobile Cares
T-Mobile | stick together
Saturday, April 01, 2017
Special Access: Why T-Mobile Cares
Key T-Mobile Facts:
96% of "cell site to end office" links (DS1s) are purchased from incumbent wireline carriers
94% of "end office to tandem" links (special access DS1s and DS3s) are purchased from incumbent wireline carriers
68% of "tandem to mobile switch" links (DS3s) are purchased from incumbent wireline carriers

6. Special Access: Why T-Mobile Cares
T-Mobile | stick together
Saturday, April 01, 2017
Special Access: Why T-Mobile Cares
Key Policy Facts:
In areas where pricing flexibility has been granted to ILECs, special access prices have gone up, not down
Qwest + 62% between 2002 and 2005
SWB +27% between 2002 and 2005
Pac Bell +15% between 2002 and 2005
Price-flex markets have DS1 rates that are 20% higher than price-capped markets today
Special Access prices are usually 25%-200% higher than prices for equivalent cost-based UNEs
ROI on special access of 37% in 2002, 43% in 2003 , and continues to climb
Validate against results of AT&T/BS Merger Conditions

7. Special Access: Why It Matters
T-Mobile | stick together
Saturday, April 01, 2017
Special Access: Why It Matters
Problems posed by the control of bottleneck telecommunications facilities
Backhaul, primarily using bottleneck special access facilities, constitutes 30% of total wireless operating expenses, which in turn affects:
The price paid by consumers
The ability to expand and improve wireless coverage
The quality of wireless service
State Commissions are in a good position to evaluate the actual competition for special access services

8. Special Access: Next Steps
T-Mobile | stick together
Saturday, April 01, 2017
Special Access: Next Steps
Understand that special access issues affect customers in your states, both in terms of price and in terms of quality of service
NARUC Study underway
Determine how special access competition should be measured
Investigate whether special access markets are sufficiently competitive to warrant price deregulation
Discover whether there are special access provisioning issues that affect competitors
Examine data at a granular level
Tell the FCC

9. T-Mobile | stick together
Saturday, April 01, 2017
Thank you! Contact Information: Dave Conn National Director, State Regulatory