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Michigan Reviews LEC Tariffs, Resale Provisions

Fortnightly Magazine - September 1 1996

While reviewing interconnection issues generic to competition in the telecommunications local exchange market, the Michigan Public Service Commission (PSC) has mandated that local exchange carriers (LECs) offer all basic local exchange services for resale at wholesale rates to competitors as well as affiliates. According to the PSC, state law defines wholesale rates as retail rates less the LEC's avoided costs.

The PSC also ruled that the state's major LECs, Ameritech Michigan and GTE North Inc., should implement "true number portability" at the same time Ameritech begins implementation in Illinois. Because all customers and providers will benefit from true number portability, the costs of development and implementation should be distributed among all providers in a competitively neutral fashion, the PSC said.

In addition, the PSC directed Ameritech and GTE to file new total-service, long-run, incremental-cost (TSLRIC) studies for unbundled loops and ports, interim number portability, and local traffic termination. The PSC found that Ameritech's existing interconnection cost studies failed to conform to a new statutory requirement that prices for interconnection reflect the TSLRIC of each particular service. It also found that the nonrecurring line connection charge of $92.13 per unbundled loop found in the carrier's existing study was not justified. The PSC said that such a charge (em probably far above TSLRIC as well as far above what the carrier charges its own customers for the same service (em would constitute a significant barrier to market entry. Re Permanent Interconnection Arrangements Between Basic Local Exchange Service Providers, Case No. U-10860, June 5, 1996 (Mich.P.S.C.).


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