1. Wireline Competition Bureau 2003 – 2004 Competition, Broadband, and Universal Service in a Dynamic Marketplace

2. 2 Strategic Goals Broadband Broadband Economic GrowthEconomic Growth Competition Competition Universal ServiceUniversal Service Homeland Security Homeland Security Modernize the FCC Modernize the FCC

3. 3 Broadband Voice over the Internet Voice over the Internet December 1, 2003 ForumDecember 1, 2003 Forum Internet Policy Working GroupInternet Policy Working Group Triennial Review Order Triennial Review Order Broadband Data Collection Broadband Data Collection Other Broadband Dockets Other Broadband Dockets

4. 4 Competition Markets Opening, Competition Increasing Markets Opening, Competition Increasing Intermodal Local Number PortabilityIntermodal Local Number Portability Joint item with WTB Joint item with WTB TELRIC Notice/Triennial Review OrderTELRIC Notice/Triennial Review Order Section 271 ApplicationsSection 271 Applications Economic Development Boosted Economic Development Boosted

5. 5 Competition First Phase of Section 271 Work Completed First Phase of Section 271 Work Completed January 15, 2003January 15, 2003 35 states approved / markets open 35 states approved / markets open 75% of RBOC access lines 75% of RBOC access lines January 15, 2004January 15, 2004 All eligible states and D.C. approved / markets open All eligible states and D.C. approved / markets open 100% of RBOC access lines open to competition 100% of RBOC access lines open to competition

6. 6 Competition Universal Service Advanced Contribution Factor Down to 8.7% from High of 9.5% Contribution Factor Down to 8.7% from High of 9.5% E-Rate and Support Portability Forums E-Rate and Support Portability Forums Schools and Libraries Reform Schools and Libraries Reform Rural Health Care Rural Health Care New rules spur economic developmentNew rules spur economic development Nearly 2x money committed in FY ’02 as FY ’00Nearly 2x money committed in FY ’02 as FY ’00 New Framework for Portability of Support New Framework for Portability of Support Ongoing Fed-State Joint Brd Coordination Ongoing Fed-State Joint Brd Coordination

7. 7 Competition Universal Service Advanced Highest-Ever Level of Telephone Penetration in Households: 95.5% Highest-Ever Level of Telephone Penetration in Households: 95.5% Penetration in American Indian Reservations: Progress, But More NeededPenetration in American Indian Reservations: Progress, But More Needed 1990 Census: 46.6% 1990 Census: 46.6% First Tabulation based on 2000 Census: 67.9% First Tabulation based on 2000 Census: 67.9% Highest-Ever Level of Internet Access in Public Schools: 99% Highest-Ever Level of Internet Access in Public Schools: 99% Highest-Ever Level of Internet Access in Public School Instructional Rooms: 92% Highest-Ever Level of Internet Access in Public School Instructional Rooms: 92%

8. 8 Homeland Security A WCB Priority Communications Assistance for Law Enforcement Act Communications Assistance for Law Enforcement Act Rural Health Care Rural Health Care Homeland Security Policy Council Participation Homeland Security Policy Council Participation Service Continuity Service Continuity

9. 9 Homeland Security Emergency Preparedness Emergency Preparedness August 14, 2003 power blackoutAugust 14, 2003 power blackout 50 million without power50 million without power Coordinated FCC/OET/WCB ResponseCoordinated FCC/OET/WCB Response OET/NRIC: promoting “best practices”OET/NRIC: promoting “best practices” Wireline Network Worked Wireline Network Worked Handled 300% call volume increaseHandled 300% call volume increase Public payphones to the rescuePublic payphones to the rescue Hurricane IsabelHurricane Isabel Section 214 Process Section 214 Process

10. 10 Power Emergency: Payphones at Work Power Emergency: Payphones at Work Payphone Items Payphone Items Tollgate OrderTollgate Order Dial-Around Compensation NPRMDial-Around Compensation NPRM Homeland Security AP/Wide World Photos

11. 11 Modernize the FCC WCB Accomplishments 177 Orders and Proposed Rulemakings 177 Orders and Proposed Rulemakings Including 75 Commission-level itemsIncluding 75 Commission-level items Promoted Competition Promoted Competition Released 108 Orders and NPRMsReleased 108 Orders and NPRMs Advanced Universal Service Advanced Universal Service Released 68 Orders and NPRMs, 166 E-Rate Appeals/ Waivers, and 1 Joint Board Recommended DecisionReleased 68 Orders and NPRMs, 166 E-Rate Appeals/ Waivers, and 1 Joint Board Recommended Decision Protected Service Continuity Protected Service Continuity Addressed 96 Section 214 Applications, including 28 bankruptcies (51% fewer bankruptcies than last year)Addressed 96 Section 214 Applications, including 28 bankruptcies (51% fewer bankruptcies than last year) 1309 Tariffs Filed 1309 Tariffs Filed 242 Congressional Letters Issued 242 Congressional Letters Issued

12. 12 Modernize the FCC WCB Accomplishments Monitored a Dynamic Market Monitored a Dynamic Market Released 20 Statistical ReportsReleased 20 Statistical Reports Conducted 2 staff studiesConducted 2 staff studies Electronic ARMIS Initiative Electronic ARMIS Initiative Eliminated all paper and diskette filingsEliminated all paper and diskette filings ILECs can file ARMIS data over InternetILECs can file ARMIS data over Internet Public can access, download filed dataPublic can access, download filed data 10% increase in ARMIS filings in 200310% increase in ARMIS filings in 2003

13. 13 Modernize the FCC Increased WCB Efficiency 75% Reduction in Backlog since July 75% Reduction in Backlog since July Staff Decreased Staff Decreased 16 Fewer Attorneys, Economists, Technical and Administrative Staff (7% Decrease)16 Fewer Attorneys, Economists, Technical and Administrative Staff (7% Decrease) Work Load / Productivity Increased Work Load / Productivity Increased 29% More Agenda Items29% More Agenda Items 33% More Statistical Reports33% More Statistical Reports

14. 14 WCB Challenges for 2004 and Beyond Broadband: Tackle VoIP and wireline broadband Broadband: Tackle VoIP and wireline broadband Competition: Address network pricing Competition: Address network pricing Competition and Homeland Security: Promote universal service; keep reforming administration – rural health care, E-rate Competition and Homeland Security: Promote universal service; keep reforming administration – rural health care, E-rate Competition: Consider pending forbearance petitions Competition: Consider pending forbearance petitions

15. 15 WCB Challenges for 2004 and Beyond Modernize the FCC: Continue backlog reduction efforts Modernize the FCC: Continue backlog reduction efforts Target: No backlog greater than 30 months by year’s endTarget: No backlog greater than 30 months by year’s end Modernize the FCC: Improve staff workplace and quality of life Modernize the FCC: Improve staff workplace and quality of life