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By the Commission: Chairman Powell and Commissioner Ness issuing separate statements; Commissioner Furchtgott-Roth concurring and issuing a statement; and Commissioner Tristani dissenting and issuing a statement.

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CHECKLIST ITEM 3 – Poles, DUCTS. CONDUITS AND RIGHTS OF WAY.........

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VIII. PUBLIC INTEREST ANALYSIS.

COMPETITION IN LOCAL EXCHANGE AND LONG DISTANCE MARKETS.

ASSURANCE OF FUTURE COMPLIANCE.

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IX. SECTION 271(D)(6) ENFORCEMENT AUTHORITY ..............

X. CONCLUSION

XI. ORDERING CLAUSES...........

APPENDIX A - LIST OF COMMENTERS

APPENDIX B - STATUTORY REQUIREMENTS - CHECKLIST ITEMS 6-12

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On January 16, 2001, Verizon New England Inc., Bell Atlantic Communications, Inc. (d/b/a Verizon Long Distance), NYNEX Long Distance Company (d/b/a Verizon Enterprise Solutions), and Verizon Global Networks Inc. (Verizon) filed this application pursuant to section

271 of the Communications Act of 1934, as amended.' for authority to provide in-region. interLATA service originating in the state of Massachusetts. We grant this application in this Order based on our conclusion that Verizon has taken the statutorily required steps to open its local exchange markets to competition in Massachusetts.

2. In approving this application. we wish to recognize the hard work of the Massachusetts Department of Telecommunications and Energy (Massachusetts Department) in laying the foundation for approval of this application. The Massachusetts Department has conducted critically important proceedings concerning Verizon's section 271 compliance open to participation by all interested parties. The Massachusetts Department and Verizon also provided for third-party testing of Verizon's operations support systems (OSS) offering. In addition, the Massachusetts Department adopted a broad range of performance measures and standards and a Performance Assurance Plan designed to create a financial incentive for post-entry compliance with section 271. State proceedings such as these serve a vitally important role in the overall section 271 approval process.

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We also commend Verizon for all of the work that it has undertaken to open its local exchange market to competition in Massachusetts. For example, Verizon states that competitive local exchange carriers (competitive LECS) serve more than 513,000 lines on a facilities basis in Massachusetts, with Verizon providing more than 333,000 interconnection trunks and 1,700 collocation nodes to competitive LECs. Verizon also states that it provides more than 93,000 unbundled local loops, including more than 69,000 stand-alone unbundled local loops and more than 23,000 unbundled loops provided as part of an unbundled network element platform (UNE-P). There is also an active resale market in Massachusetts. Verizon states that it provides more than 268,000 resold local exchange lines, including 238,000 business lines and 30,000 residential lines. These results bear out the fact that Verizon has made extensive efforts to open its local markets in compliance with the requirements of the Act.3

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In the 1996 amendments to the Communications Act, Congress required that the Bell Operating Companies (BOCs) demonstrate compliance with certain market opening requirements contained in section 271 of the Act prior to entering the in-region, interLATA market. Congress also provided for Commission review of BOC applications to provide such

1 In 1996, Congress amended the Communications Act of 1934 to foster the development of local exchange competition, among other things. The Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996). We refer to the Communications Act of 1934, as amended by the Telecommunications Act of 1996, as the Communications Act or the Act.

2

Supplemental Filing of Verizon New England, CC Docket No. 01-9 (filed Jan. 16, 2001) (Verizon Massachusetts II Application).

3 See id. Attach. A.

services in consultation with the affected state and the Attorney General. The Commission has summarized the applicable statutory framework in a number of prior orders and need not repeat this material here.*

5. On May 24, 1999, Verizon filed a draft section 271 application with the Massachusetts Department.' The Massachusetts Department conducted a sixteen-month investigation of Verizon's compliance with section 271. These proceedings were open to full participation by all interested parties. This process included: a comprehensive third-party test of Verizon's OSS; numerous technical sessions with the Department's staff. Verizon and many competitive LECs; a series of public hearings and oral arguments; and hundreds of information requests.

6. In August of 1999, the Massachusetts Department contracted with KPMG consulting, L.L.C. to perform a third-party test of Verizon's OSS performance. In January 2000. the Massachusetts Department adopted the performance metrics developed in the New York carrier-to-carrier proceeding as the metrics to be used and replicated by KPMG in evaluating Verizon's performance in Massachusetts. On September 7, 2000, KPMG issued its final report. which found that Verizon satisfied 800 of 804 test points relating to its review of Verizon's OSS."

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Verizon filed its initial application for section 271 authority for the state of Massachusetts (the Massachusetts I Application) on September 22, 2000, but later chose to

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See, e.g., Joint Application by SBC Communications Inc., Southwestern Bell Tel. Co., and Southwestern Bell Communications Services, Inc., d/b/a Southwestern Bell Long Distance for Provision of In-Region, InterLATA Services in Kansas and Oklahoma, Memorandum Opinion and Order, FCC 01-29, CC Docket No. 00-217, paras. 710 (rel. Jan. 22, 2001) (SWBT Kansas/Oklahoma Order); Application by SBC Communications Inc., Southwestern Bell Tel. Co., and Southwestern Bell Communications Services, Inc. d/b/a Southwestern Bell Long Distance Pursuant to Section 271 of the Telecommunications Act of 1996 To Provide In-Region, InterLATA Services in Texas, Memorandum Opinion and Order, 15 FCC Rcd 18354, 18359-61, paras. 8-11 (2000) (SWBT Texas Order); Application by Bell Atlantic New York for Authorization Under Section 271 of the Communications Act To Provide In-Region, InterLATA Service in the State of New York, Memorandum Opinion and Order, 15 FCC Rcd 3953, 396163, paras. 17-20 (1999) (Bell Atlantic New York Order).

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See Verizon Massachusetts I Application App. B. Vol. la-aa, Tab 2 (Massachusetts DTE, D.T.E. 99-271, Inquiry by the Department of Telecommunications and Energy pursuant to Section 271 of the Telecommunications Act of 1996 into the Compliance Filing of New England Telephone and Telegraph Company d/b/a Bell AtlanticMassachusetts as part of its application to the Federal Communications Commission for entry into the in-region interLATA (long distance) telephone market).

6

See Verizon Massachusetts I Application App. B. Vol. 24. Tab 282 (Massachusetts DTE, D.P.U. 99-271, Evaluation of Bell Atlantic-Massachusetts Operations Support Systems: Final Attachment A to 11/19/99 Letter Order on Final Master Test Plan (Jan. 14, 2000)).

7

See generally Verizon Massachusetts I Application App. I, Vol. 1a-b (KPMG Final Report).

8

Application by Verizon New England for Authorization to Provide In-Region, InterLATA Services in Massachusetts, CC Docket No. 00-176 (filed Sept. 22, 2000) (Verizon Massachusetts I Application).

withdraw it.' Verizon filed another application for Massachusetts (the Massachusetts II Application) on January 16. 2001. The Massachusetts II Application incorporates the material in the original application by reference to demonstrate compliance with most of the section 271 requirements. It also provides additional information concerning Verizon's provision of DSLcapable local loops, the availability of loop make-up information and line sharing. In addition. competitive LECs now have access to Verizon's carrier specific performance data."

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8.

Evaluations of Massachusetts Department and Department of Justice

The Massachusetts Department supports Verizon's application to provide inregion, interLATA long distance service originating in Massachusetts. Specifically, it concluded that Verizon had met the requirements of section 271, and urged the Commission to approve Verizon's in-region, interLATA entry in both its October 16, 2000 evaluation of the Massachusetts I Application," and its February 6, 2001 evaluation of the Massachusetts II Application.

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9. The Department of Justice filed its evaluation of Verizon's Massachusetts I Application on October 27, 2000." It recommended that the Commission not approve the application until Verizon had demonstrated that it provides nondiscriminatory access to DSLcapable loops and established suitable performance measures with unambiguous benchmarks for DSL-capable loops.' The Department of Justice submitted an evaluation of Verizon's

9

See Letter from Michael E. Glover, Senior Vice President & Deputy General Counsel, Verizon, to Magalie Roman Salas, Secretary, Federal Communications Commission, CC Docket No. 00-176 (filed Dec. 18, 2000).

10 Verizon Massachusetts II Application.

The availability of this information plays a critical role in the ability of competitive LECs to participate in the section 271 application review process.

12 Evaluation of the Massachusetts Department of Telecommunications and Energy, CC Docket No. 00-176 (filed October 16, 2000) (Massachusetts Department Massachusetts I Comments). On November 3, 2000, the

Massachusetts Department filed its reply (Massachusetts Department Massachusetts I Reply).

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Evaluation of the Massachusetts Department of Telecommunications and Energy, CC Docket No. 01-9 (filed February 6, 2001) (Massachusetts Department Massachusetts II Comments). On February 28, 2001, the Massachusetts Department filed its second reply (Massachusetts Department Massachusetts II Reply).

14

Evaluation of the United States Department of Justice, CC Docket No. 00-176 (filed October 27, 2000) (Department of Justice Massachusetts I Evaluation).

15 See Department of Justice Massachusetts I Evaluation at 2. The Department of Justice found that, "although Verizon has satisfied this standard in most respects, important issues remain inadequately addressed." Id. It noted that the principal issue on which Verizon had failed to develop an adequate record was its provision of DSL-capable loops. See id. The Department concluded that Verizon had not yet demonstrated that it provides nondiscriminatory access to DSL-capable loops, including line sharing, or that adequate performance mechanisms were in place to deter backsliding. See id. at 24. The Department of Justice recommended that we not permit Verizon to offer interLATA services in Massachusetts until Verizon demonstrated that it has resolved these shortcomings. See id. at

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