ice Commission t Virginia February 16,201 1

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1 ice Commission t Virginia Street, P. 0. Box 812 Phone: (304) Charleston, West Virginia FgX: (304) Mark E. Kauffelt, Esq. Counsel, Linkup Telecom, Inc. Kauffelt & Kauffelt PO Box 3082 Charleston, WV February 16,201 1 RE: Case No T-PC Linkup Telecom, Inc. Dear Mr. Kauffelt: Pursuant to Rule 2 of the Commission s Rules of Practice and Procedure, we are enclosing a copy of the Staff memorandum in this matter. If you wish to respond to the enclosed Staff memorandum, you may do so in writing, within 10 days, unless directed otherwise, of this date. Your failure to respond in writing to the utility s answer, Staffs recommendations, or other documents may result in a decision in your case based on your original filing and the other documents in the case file, without further hearing or notice. If you have provided an address you will automatically receive notifications as documents are filed in this proceeding. The notifications allow recipients to view a document within an hour from the time the filing is processed. If you have not provided your address, please send an to casein foi~!~sc.str~~e.wv.us and state the case number in the subject field. General reminder - if you submit any additional documents - in addition to filing an original and 12 copies of all documents with the Commission, you are required to mail a copy to all other parties of record. Please note - the Public Service Commission does not accept electronic filings. SSicg Enc.- Memo Executive Secretary Division

2 INITIAL JOINT STAFF MEMORANDUM TO: FROM: RE: SANDRA SQUIRE DATE: FEBRUARY 16,2011 Executive Secretary CHRIS HOWARD Staff Attorney r: ea-., $ ", *h, F'=+ ;+Z"? FEg 16 p<c gxe[ >:r :-:-=: CASE NO T-PC LINKUP TELECOM INC. *-& r- i.= 7:: On January 19, 201 1, Linkup Telecom, Inc. (Company) filed a Petition for limited designation as an eligible telecommunications carrier before the West Virginia Public Service Commission (Commission). The Company states this filing is solely for the purpose of providing services under the low income programs. The granting of this Petition will further the public interest as it would enable the Company to commence much needed services to lower income residents and will further the provision of competitive choices in the West Virginia marketplace. Initial Recommendation of the Commission's Utilities Division Staff On February 14, 201 1, David Kennedy, Utilities Analyst for the Commission's Utilities Division (Technical Staff) issued an Initial Recommendation. Technical Staff states the Company anticipates eligible customers qualifying under the Lifeline program will receive each month 100 free minutes a month or an initial 300 minutes a month at a cost of $ Further, customers obtain additional prepaid calling time at $0.135 per minute. The Company's offering will include: caller ID, call waiting, call forwarding, 3-way calling, and voic . The Telecommunications Act of 1996 (The Act) provides that only designated Eligible Telecommunications Carriers are eligible to receive federal universal support. The Commission may upon meeting certain requirements in the Act designate a telecommunications carrier as an Eligible Telecommunications Carriers. Pursuant to the Act in order to be designated as an Eligible Telecommunications Carriers, a carrier must meet the following conditions: (1) (2) (3) (4) be a common carrier as determined by federal law offer the services using its own facilities or a combination of its own facilities and resale, throughout the designated service area advertise the availability of its service offering using media of general distribution. provide universal service obligations throughout a designated geographic area.

3 Case No T-PC February 16,201 1 Page 2 Additionally the Act mandates that Eligible Telecommunications Carriers must also provide the following nine (9) specific support services: voice grade access to the public switched telephone network; local usage; dual-tone multi-frequency (DTMF) signal or its fimctional equivalent; single party service or its functional equivalent; access to emergency services; access to operator services; access to interexchange services; access to directory assistance; and toll limitation for qualifjing low-income customers. The Company requests the Commission expeditiously process this case; Technical Staff has requested additional information from the utility and will issue a final recommendation upon completion of its review in this case. Initial Recommendation of the Commission s Legal Division Staff Legal Staff has reviewed the filings, including the Petition and the Initial Recommendation of Technical Staff. Legal Staff concurs with the findings and the recommendations of Technical Staff. The Petitioner should respond to the request for additional information of Technical Staff. Staff will complete its investigation and file a final substantive recommendation within the Commission s time frame. CLH/cls Attachment cws L.dj H.\choward\ pd s\l t-pc (Linkup Telecom, Inc.)\INITIAL JOINT STAFF MEMORANDUMTO.wpd

4 PUBLIC SERVICE COMMISSION OF WEST VIRGINIA UTILITIES DIVISION INITIAL RECOMMENDATION DATE: February 14,201 1 David Kennedk Utilities Analyst Linkup Telecom, Inc. On January 19, Linkup Telecom, Inc. requested designation as an Eligible Telecommunications Carrier (ETC) for the purpose of offering prepaid wireless Lifeline service to low income households in West Virginia supported by the Universal Service Fund (USF). The petitioner states that it seeks only ETC status for the purpose of participating in the USF Lifeline and Link-Up America program and not for the High Cost program. The Universal Service High-Cost program is designed to ensure that consumers in rural, insular, and high-cost areas have access to telecommunications services at rates that are affordable and reasonably comparable to those in urban areas. The program fulfills this universal service goal by allowing eligible carriers who serve these areas to recover some of their operating costs from the federal Universal Service Fund. The Low-Income program provides discounts on telephone installation and monthly telephone service to qualifying consumers. There are two programs available to qualified low-income consumers. Link-Up America helps consumers with telephone installation costs. Lifeline provides discounts on monthly telephone service. Staff notes the potential for some confusion regarding the name of the Petitioner (Linkup) which is the same as one of the two low cost programs for which USF reimbursement will be sought. Nevertheless, Staff can find no authority to deny or amend the petition of a carrier who has been duly authorized by the West Virginia Secretary of State to use a particular corporate name. Therefore whenever the utility is referred to in this memorandum the name Linkup will be used. Whenever reference is made to the low cost program the name Link- Up America will be used. The utility seeks eligibility throughout the service territories of Verizon West Virginia, Inc. DBA Verizon West Virginia (Verizon). Linkup affirms that it is maintains the capability of offering all of the services and fimctionalities throughout its Service Area as mandated by Federal Communications regulation, specifically the non rural geographic area served by

5 Page Two Case No T-PC Utility Division Staff Recommendation Verizon. Staff notes that the territory once served by Verizon is now served by Frontier West Virginia pursuant to Case No T-PC. 4 The utility s service includes 91 1 service and where available E-91 1 service, According to the petitioner, Linkup will provide each eligible customer a free hand set. The service offering includes an allotment of free monthly airtime and an ability to purchase additional airtime as needed. Eligible customers will receive either 100 free minutes each month or 300 initial minutes at a cost of $27.00 per month. In addition any unused minutes will roll over into the next month. Additionally, the petitioner maintains that the customer will incur no monthly recurring charge. Additional airtime minutes may be purchased at a cost of $0.135 per minute. Specifically, the additional minutes are offered in denominations of 50 minutes at a cost of $6.75, 75 minutes at a cost of $10.13, 100 minutes for $13.50, and 300 minutes at a cost of $ The company s offering will also include provision of the following services: 1) Caller ID 2) Call Waiting 3) Call Forwarding 4) 3-Way Calling 5) Voic Service under the Link-Up America program will be provided in the form of a reduction in the carrier s charge for initiating service. The charge will be half of Linkup s customary charge for commencing service for a single telecommunication connection or $30.00 which ever is less. The utility maintains that this will result in a reduction of the activation fee by $ The company states that there is no up front connection charge to qualifying customers. Specifically, subscribers will have the option of receiving a waiver of any activation charge. The petitioner points out that under FCC guidelines an ETC must submit a five (5) year plan specifically describing proposed improvements or upgrades to the carrier s network on a wire-center-by-wire-center basis throughout the designated service area. Since Linkup does not request authority as an ETC for providing

6 Page Three Case No I T-PC Utility Division Staff Recommendation reimbursable support under the High Cost program, the petitioner maintains that submission of a five year network improvement is not required. The petitioner asserts that all USF support received will be used for the provision of Lifeline Service. In accordance with federal regulation, the utility commits to contributing a portion of its interstate revenues to the Universal Service Fund. In accordance with federal regulation Linkup further provides that prospective customers must certify at the time of service activation and annually thereafter that they: 1) Are the head of household 2) Participate in one of the state approved means tested programs 3) Receive Lifeline supported services only from Linkup 4) Are not currently receiving Lifeline support 5) Will notify Linkup if they no longer participate in the qualifying programs. Pursuant to the Act in order to be designated as an ETC, a carrier must meet the following conditions: (1) be a common carrier as determined by federal law (2) offer the services using its own facilities or a combination of its own facilities and resale, throughout the designated service area (3) advertise the availability of its service offering using media of general distribution. (4) provide universal service obligations throughout a designated geographic area. Additionally the Act mandates that Eligible Telecommunications Carriers must also provide the following nine (9) specific supported services: 1. voice grade access to the public switched telephone network; 2. local usage; 3. dual-tone multi-frequency (DTMF) signal or its functional equivalent; 4. single party service or its functional equivalent; 5. access to emergency services;

7 Page Four Case No T-PC Utility Division Staff Recommendation 6. access to operator services; 7. access to interexchange services; 8. access to directory assistance; and 9. toll limitation for qualifying low-income customers. Finally, an ETC must provide certain information on an annual basis concerning its operation over the previous twelve months. Staff has followed up this memorandum with the attached request for additional information from the utility and will issue a final recommendation upon completion of its review in this case. Staff will issue a final recommendation after completion of its review of this petition.

8 West Virginia Public Service Commission Case No T-PC Linkup Telecom, Inc. request for designation as an Eligible Telecommunications Carrier Staff request for addition information 1) The utility seeks eligibility throughout the service territories of Verizon West Virginia, Inc. DBA Verizon West Virginia (Verizon). Staff notes that the territory once served by Verizon is now served by Frontier West Virginia pursuant to Case No T-PC. Does the Petitioner seek ETC eligibility throughout the service area now served by Frontier West Virginia? 2) In order to receive designation as an Eligible Telecommunications Carrier a company must offer services using its own facilities or a combination of its own facilities and resale throughout the designated service area [Section 214(e)( 1)(A) of the Telecommunications Act]. The Petitioner states that it maintains its own facilities in the state of Florida which are collocated with other carrier s facilities which enable Linkup to provide one or more of the supported services, including Directory Assistance. What supported services will the Petitioner provide through its own facilities in the proposed service area? 3) The Petitioner states that eligible customers will receive either 100 free minutes each month or 300 initial minutes at a cost of $27.00 per month. Additionally, the petitioner maintains that the customer will incur no monthly recurring charge. How will the $27.00 per month for 300 minutes be charged to the customer? Is a customer apprised of the differences in the plans at the time they initiate service? 4) According to the Petitioner, service under the Linkup America program will be provided in the form of a reduction in the carrier s charge for initiating service. The charge will be half of Linkup s customary charge for commencing service for a single telecommunication connection or $30.00 which ever is less. The utility maintains that this will result in a reduction of the activation fee by $ The company states that there is no up front connection charge to qualifying customers. Specifically, subscribers will have the option of receiving a waiver of any activation charge. What is the customary charge for initiating service and describe the waiver process? What happens if a customer does not remain active for the entirety of the initial 12 month period? What exactly is the choice available to the customer with regard to the waiver option?

9 5) The Petitioner asserts that all USF support received will be used for the provision of Lifeline Service. Does the Petitioner anticipate using USF support for the Link-Up America program? 6) In this petition Linkup states that customers will receive additional features such as voice mail, Caller ID, Call Waiting, Call Forwarding, 3 Way Calling and Voic . Are these additional features also provided at no additional cost even after the initial free monthly allotment of free minutes have been consumed? If a customer does not use the initial allotment of free minutes, do they roll over into the next month? Likewise do additional purchased minutes expire if not used within a specific time period? What measures assure that a single customer does not have more than one Lifeline supported service telephone? 7) Staff understands the following with regard to charges for Lifeline Customers: a) New customers will receive a free handset. b) Eligible customers may receive an allotment of minutes each month at no charge. Will qualifying customers be allowed to use their own handsets in lieu of the free handset provided by the carrier? Is the free handset E-91 1 compliant? Are there any additional fees not mentioned in the petition such as startup or activation fees? Is there a monthly service charge? Are there additional roaming charges and if so how much? Is long distance calling included in the Lifeline service offering and at what rate? Are there any other additional features included beyond that mentioned in the petition (voice mail, caller ID, Call Waiting, Call Forwarding, and 3 way Calling)? Are there any term contractual obligations required of Lifeline customers? Is a Lifeline customer required to make a cash deposit in order to begin or continue to receive service?

10 8) Additional airtime minutes may be purchased at a cost of $0.135 per minute. Specifically, the addition minutes are offered in denominations of 50 minutes at a cost of $6.75, 75 minutes at a cost of $10.13, 100 minutes for $13.50, and 300 minutes at a cost of $ Is the price and allotment different than that provided to customers who do not take part in the Lifeline or Link-Up America programs? 9) Page 3 of the petition states that Linkup is not seeking ETC designation on a wireless basis. Additionally, Page 5 states Designation of Linkup as an ETC on both a wireline and wireless basis is in the public interest of the State of West Virginia and its lowincome telecommunications end-users. In addition, page 6 of the petition reads as follows Linkup is seeking ETC designation on a wireless basis.,. Please clarify the apparent discrepancies in these statements Staff believes that Linkup seeks ETC status to provide pre-paid wireless Lifeline and Link-Up America supported services only. Is Staffs understanding correct? 10) Staff requests answers to the following questions. Does Linkup provide or intend to provide non USF supported pre-paid wireless service using another name? What name or names does Linkup intend to use in offering service provided though Universal Service Funding? Does Linkup receive Universal service support funding under other names in other states? In what states has Linkup been granted ETC status? List any states in which ETC status has been requested but denied? List any states in which the request for ETC status is pending. Please describe Linkup s policy with regard to disconnection in the event it is determined that a customer no longer meets the Lifeline eligibility requirements or if the account is inactive for a period of time. Is there a termination charge? 11) Please submit a proposed tariff in compliance with the Rules & Regulations for the Government of the Construction & Filing of Tarus of Public Utilities & Common Carrier by Motor Vehicle [

Lance J.M. Steinhart, P.C. Attorney At Law 1725 Windward Concourse Suite 150 Alpharetta, Georgia 30005

Lance J.M. Steinhart, P.C. Attorney At Law 1725 Windward Concourse Suite 150 Alpharetta, Georgia 30005 Also Admitted in New York Telephone: (770) 232-9200 and Maryland Facsimile: (770) 232-9208 Email: