BEFORE THE WASHINGTON UTILITIES
                 AND TRANSPORTATION COMMISSION
          

WASHINGTON UTILITIES AND      )
TRANSPORTATION COMMISSION     )   Docket No. UT-950200
                              )                    
           Complainant,       )
                              )
                v.            )
                              )
US WEST COMMUNICATIONS, INC., ) 
          Respondent.         )

 
     CONSUMER PROJECT ON TECHNOLOGY'S LIMITED INTERVENTION
     TO RESPOND TO INTEL'S MOTION FOR CONTINUANCE/DEFERRAL 
            OF US WEST'S ISDN RATE INCREASE PROPOSAL

     The Consumer Project on Technology (CPT)  was created by
Ralph Nader in 1995 to represent the rights of consumers in the
area of telecommunications and other issues.  A more detailed
description of our organization can be found on the Internet, at
http://www.essential.org/cpt.  We are active in efforts to
prevent local exchange telephone companies from charging
excessive prices for residential ISDN services.  Like a growing
number of persons in the computer and telecommunications field,
we believe that regulators have a important opportunity to vastly
enhance public access to the information superhighway by insuring
that residential ISDN services are widely deployed at reasonable
prices.

     We recently learned that US WEST has pending before the
Commission a proposal to revise its current flat rate ISDN tariff
of $63 per month, and that the residential flat rate option would
be increase to $184 per month.  We believe the rate increase is
excessive and would stifle deployment of ISDN services.  ISDN is
an important technology representing the next step in the
evolution of the information superhighway, and US West's proposal
would prevent ISDN from reaching its potential in opening up new
services and telecommunication advances on the Internet.

     In addition to the grossly overpriced rate proposal, US
West's tariff suffers from procedural irregularities.  US West
failed to provide proper public notice of the ISDN rate proposal. 
As a regulated public utility that wields enormous monopoly
power, and proposes drastic rate increases in important services,
US West should be required to adhere to strict compliance with
public notice obligations.

     The public policy issues presented by the pricing of
residential ISDN are extremely important.  ISDN is the most
efficient way to provide the general public with immediate
benefits in terms of a cost effective solution to higher speed
access to the Internet.  Since residential ISDN can be delivered
over the existing copper wire infrastructure, which consumers
have already paid for, regulators have an opportunity to vastly
enhance public access to the information superhighway to a low
cost.  Greater access will result, however, only if US West is
required to price the service in a just and reasonable way.

     US West has tried to avoid a separate notice on the ISDN
issue. As a result, many persons who would have considered filing
various types of motions or comments before the Commission on the
residential ISDN tariff issue, never had an opportunity to do so. 
Intel's suggestion that the broader computer, software, and
online community be given a real opportunity to comment on and
participate in the proceedings to modify the residential ISDN
tariff correctly identifies these groups as those that are
particularly important stakeholders in this matter.

     For these reasons, which are more fully discussed below, we
support Intel's Motion For Continuance/Deferral of US West's ISDN
Rate Increase Proposal. 

I.  US West's Tariff Proposal is Overpriced 

     US West's rate increase from a flat rate of $63 per month to
$184 per month is clearly excessive.  Several independent studies
on the incremental cost of providing ISDN service conclude that
the costs are much lower than the current US West tariff, and
many times less than the proposed $184 per month.

-    A 1993 study by the Tennessee Public Service Commission
     (TPSC) staff estimated the incremental cost of providing
     ISDN service to be $9.77 (per month), including right-of-way
     costs.  This study is described in detail in John Borrows'
     and William Pollard's "The National Regulatory Research
     Institute's Review of Tennessee's Integrated Services
     Digital Network Cost Studies," NRRI Quarterly Bulletin, Vol.
     15, No. 1, March 1994, pages 125-139.  The TPSC approved
     flat rate residential ISDN tariffs of $21 to $26 per month.

-    In an earlier 1991 study, the Massachusetts Department of
     Public Utilities found that the "marginal cost" of ISDN
     service was $7.40 (per month) over the cost of POTS service.

-    In studies for the Consumer Federation of America, Mark
     Cooper has estimated the marginal cost of an ISDN service
     (over the cost of POTS) to be $2 to $4 per line (per month),
     and falling.

-    In an ISDN tariff currently pending before the District of
     Columbia Public Service Commission, the PSC Staff has
     undercut Bell Atlantic, Washington, D.C., Inc.'s tariff
     proposal by recommending a flat rate of $32 per month. 
     While we believe that even the D.C. Public Service
     Commission staff's recommendation is too high, it is more
     closely tailored to the real costs that will be incurred in
     providing ISDN service than the plainly excessive tariff
     submitted by US West.  It also demonstrates that far from
     entertaining US West's proposed increase, its current ISDN
     flat rate of $63 per month should be significantly reduced.

-    Local Washington State software developer Bill Gates has
     also commented on this issue.  In his 1995 book, The Road
     Ahead, Gates recommends a residential ISDN tariff of less
     than $20 per month.  He says:

          ISDN was invented more than a decade ago, but
          without PC-application demand almost no one
          needed it. . . .  The [ISDN] line costs vary
          by location but are generally about $50 per
          month in the United States.  I expect this
          will drop to less than $20, not much more
          than a regular phone connection.  We are
          among companies working to convince phone
          companies all over the world to lower these
          charges in order to encourage PC owners to
          connect, using ISDN. (page 101).

     At present, the Washington US West ISDN flat rate tariff of
$63 per month is roughly four times the cost of POTS.  This
tariff is unreasonable.  The proposed changes in the tariff would
result in tariffs as high as $184 per month for residential ISDN
service --  more than ten times the cost of POTS.  Such a pricing
proposal is a plain abuse of US West's monopoly position and
against the clear weight of the evidence pointing to the
relatively minor expenditures required to provide ISDN service.

     The Commission must decide this issue consistent with the
independent studies and expert opinions noted, and encourage the
broad deployment and use of ISDN as the next step in facilitating
development of the information superhighway.  To decide otherwise
and approve US West's rate hike would permit an abuse of monopoly
power and unnecessarily stifle development of this important
technology.   


II.  US West Failed to Comply with Procedural Notice Requirements

     In pursuing its radical escalation of ISDN rates, US West
has not complied with mandatory notice requirements.  This is a
serious breach in any rate case before the Commission, but it is
particularly egregious here considering the extreme rate increase
sought by a monopoly.  The notice requirements of WAC-80-125
applicable to US WEST's 300% proposed ISDN rate increase include
a requirement that US WEST provide to the public a notice which
"shall . . . set forth the amount of the proposed increase
expressed in . . . total dollars and average percentage terms,"
and "shall be prepared in such a manner as to attract attention
to it and to distinguish it from other material simultaneously
distributed.  A copy of such statement shall also be mailed or
delivered to one newspaper of general circulation, and at least
one radio station and at least 
one television station, in the area or each of the areas
affected.  The utility shall promptly file a copy of the
statement with the commission and certify it has complied with or
is in the process of
complying with these mailing and delivery requirements."

     US WEST has not complied with any of these requirements with
respect to its proposed 300% ISDN rate increase.  The Commission
should not set a precedent that allows a waiver of these
requirements for a monopoly utility, especially in the context of
a proposed 300% rate increase.  The important procedural
protections found in WAC-80-125 are in place to protect consumers
from precisely this type of situation.  The Commission must not
allow US West subvert the Commission's procedural requirements
and install an outrageous rate increase at the expense of
Washington's consumers.


III.  Conclusion.

     As noted above, the Consumer Project on Technology fully
supports Intel's request that the Commission order US WEST to
issue the appropriate public notices as required by law, and
defer the hearings on the ISDN issue in this docket, or
investigate and review the proposed ISDN rates in a separate
docket.  In addition, we applaud the Commission staff for
establishing a mechanism to receive comments on the Intel motion
to intervene by electronic mail (isdn@wutc.wa.gov).


Date:  January 4, 1996

submitted,


Todd J. Paglia, Esq.
Consumer Project on Technology
P.O. Box 19405
Washington, D.C.  20036
voice     (202) 387-8030
fax       (202) 234-5176