CommLawBlog : Broadcast & Communications Lawyers & Attorneys : Fletcher Heald & Hildreth Law Firm : Telecommunications, FCC Regulation, Communications Act

Public notice seeks further comments on specialized and wireless services

 As all Network Neutrality aficionados know, last October the Commission took a huge step toward adopting Net Neutrality rules by issuing a Notice of Proposed Rulemaking (NPRM) in which it laid out six principles that would be codified in the FCC’s rules. (Check out our post about the NPRM here.) The proposal was, and remains, ambitious – and subject to considerable debate. That debate is complicated by the fact that Internet-related technological and commercial developments and innovations continue despite, or possibly because of, the pendency of the NPRM.

Apparently responding to some of those developments and innovations, the Commission has now issued an inquiry into two “under-developed issues” in its on-going “Open Internet” deliberations. In particular, the FCC is focusing on how its Open Internet approach should address: (1) certain “specialized” services (referred to in the NPRM as “managed or specialized services”); and (2) mobile wireless platforms.

Much has happened in the 10 months since the NPRM was released. Over and above the tens of thousands of comments which have been submitted in response to the NPRM, the Open Internet approach has been addressed, often contentiously, in Congress, at the FCC, and in countless other public venues. The discussion has been dramatically affected by the D.C. Circuit’s Comcast decision, which undercut the jurisdictional basis for the proposed Open Internet rules.  Chairman Genachowski has announced a novel “Third Way” proposal – not formally adopted by the Commission, but nevertheless supported by two other Commissioners and the FCC’s General Counsel – which might allow the Commission to achieve its Open Internet goals despite the limitations imposed by the Comcast decision. Negotiations have been held among the major players under the auspices of the FCC and Congress. And Verizon and Google have reached agreement on a “Legislative Framework Proposal” (Verizon-Google Proposal) intended, in their words, to “preserve the open Internet”.

With so many moving parts, it's little wonder that the FCC needs more information.

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Third Circuit sends 2006 DE rules back to FCC for further consideration; $14B auction results from 2006 left untouched

Back in 2006, with big-ticket wireless auctions fast approaching, the FCC hustled through revisions of a number of rules affecting bidding credits in those auctions. The bad news for the FCC: the U.S. Court of Appeals for the Third Circuit has now sent two of the three rule changes back to the agency for a re-do because of procedural shortcomings in the 2006 rulemaking process. The good news for the FCC: the Court decided that the Commission will not have to re-do the auctions conducted pursuant to those flawed rules and, perhaps more importantly, will not have to give back the $14 billion or so it raked in in the August, 2006 auctions.

The bidding rules at issue involve eligibility for “Designated Entity”, or “DE”, status. Bidders entitled to that status are smaller companies that might otherwise find it hard, if not impossible, to compete with larger, well-established telecom companies in a dollar-for-dollar face-off. Committed to encouraging new entrants into the telecom universe, Congress instructed the Commission (in 47 U.S.C. §307(j)) to ensure opportunities for small businesses by, among other things, making bidding credits available to them. A bidding credit is defined by the FCC as a “percentage discount applied to the high bid amount for a license.” Practical illustration: if a bidder with a 25% bidding credit wins an auction with a bid of, say, $1 million, that bidder would have to pay only $750,000 after the credit is applied.

Credits of 15%, 25% or 35% were available (depending on various factors). With wireless prices hovering in the nine- and ten-figure range (T-Mobile alone bid a total of more than $4 billion-with-a-“b” – in the 2006 auction; four other bidders also tendered aggregate bids topping the $1 billion level), the credits were obviously worth serious money. With an eye toward ensuring that bidding credits were awarded only to companies deserving them, the Commission tried, in the run-up to the August, 2006 auctions, to tighten up the eligibility standards. 

That’s where it ran into problems.

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FCC proposes more spectrum, more flexibility for wireless backhaul in Fixed Microwave Service.

An easily-overlooked aspect of the miracle of modern mobile communications is the fact that, to get anywhere, those communications must link to decidedly non-mobile network connections.  Sure, your iPhone/Blackberry/Droid/etc. roams freely hither and yon, sending its signal to this cell tower or that, wherever you happen to be. But once the signal gets to the tower, it then has to get to the network to make your connection. The link that moves the signal from cell site to core network is prosaically referred to as “backhaul”.

While backhaul has traditionally been carried on copper wire or fiber, carriers are increasingly turning to wireless technology for capacity to meet the increased demand created by growing numbers of bandwidth-hungry mobile devices and applications. Wireless backhaul is particularly desirable in rural and remote locations where laying wire or fiber isn’t practical. 

Not surprisingly, the FCC is looking into expanding wireless backhaul technology. It has issued a combined Notice of Proposed Rulemaking (NPRM) and Notice of Inquiry (NOI) inviting your comments.

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A promising technology is slowed by regulators, then stifled in the standards-setting process.

After 12 years, the FCC has closed out one of the longest and most contentious rulemakings in recent memory.

Ultra-wideband was bound to be controversial from the start.  The basic idea consists of spreading a low-level signal across a very wide swath of spectrum, often a gigahertz or more. In principle, the level at any one frequency is too low to interfere with conventional spectrum users, but the power adds up across the wide bandwidth into a useful signal.

The FCC expected two main kinds of uses: data transmission, which can reach hundreds of megabits per second over short distances, and a variety of imaging and radar applications.

The Slow Grind of Regulation

When the FCC first proposed rules to allow ultra-wideband, virtually all major categories of spectrum users rose up as one to oppose it. The opposition included:

• aerospace companies
• amateur radio associations and operators
• airlines and their associations
• broadcasters
• major cell phone manufacturers
• cell phone service providers (especially vehement in their opposition)
• U.S. Government agencies (including the Department of Defense, Federal Aviation Administration, and NASA)
• the GPS industry association and several manufacturers
• aviation radio interests
• maritime radio interests
• medical telemetry companies
• many police and fire departments
• satellite radio providers
• many satellite companies and their association (likewise vehement)
• telephone equipment manufacturers, and
• many more.

Facing down this expensively lawyered force was a small handful of start-up companies, backed by a few established radar manufacturers. But the start-ups had something on their side even more powerful than lawyers: the laws of physics. Straightforward analyses showed that ultra-wideband, with appropriate safeguards, was non-interfering.  Opponents that tried to show otherwise had to make unrealistic assumptions in their math. At least, that is how the FCC saw it.

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Applicants would have to track down and turn over multiple documents – all of which the FCC already has.

Wireless licensees take note: the FCC has proposed changes to its renewal procedures, changes that could mean a lot of extra work for you, with little clear public benefit. 

The Commission is proposing to require wireless licensees to submit, along with their renewal applications, copies of all FCC orders finding a violation or apparent violation issued with respect to the licensee during the license term, whether or not the violation(s) (or alleged violation(s)) relate to the license being renewed – and whether or not a violation was ultimately found. That’s right – the FCC wants more copies of its own documents. It also wants a list of petitions to deny filed for any reason against any application submitted by the licensee – again, even applications involving licenses that are not part of the subject renewal application.

But wait. It gets worse.

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Brilliant stratagem or craven sell-out? It’s too soon to tell – so concentrate and ask again later.

Despite the fact that things on the Performance Rights Act (PRA) front remain quiet down on Capitol Hill, talk about the PRA has been burning up the trade press and the blogosphere lately. The reason? Reports that the National Association of Broadcasters (NAB) sat down with representatives from the music industry to discuss, among other things, the question of performance rights. Throw in a statement from an NAB spokesman alluding vaguely to “possible alternatives to pending legislation” (i.e., presumably, the PRA), and you’ve got the grist for a blog-tastic free-for-all in which anybody and everybody has an opinion, even though most lack a complete picture of exactly what might be going on.

CommLawBlog has done its fair share of writing on the PRA, but it’s been a while. In the midst of the sturm und drang, I think it might be useful to clarify what we know and what we don’t know before the chatter gets out of hand (and if you know something that we don’t, feel free to chime in in the comment section). 

Here’s what we know:

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Congress wants annual reports. The FCC delivers. The rest of us yawn.

The Commission has released its Seventh Broadband Deployment Notice of Inquiry (7th NOI), the ostensible purpose of which is to determine whether broadband is being deployed to all Americans in a reasonable and timely fashion.

As we glance through it, our overriding question is: Why?

The simple answer is because Congress said so. In the Telecommunications Act of 1996, Congress required the Commission to crank out such reports on an annual basis. It’s that time of year again, for the seventh time.

But the FCC already has most of the answers to the questions it asks, answers which are, in fact, pretty obvious both historically and logically. The FCC could as easily have skipped over the subject matter of the 7th NOI and jumped right to the heart of the matter: namely, what can, or should, the FCC do about the unmistakable fact that some folks don’t have broadband service?

The starting point of the 7th NOI branches off from the previous year’s effort, which was completed only last month with the release of the 2010 Sixth Broadband Deployment Report (6th Report). As my colleague Mitchell Lazarus reported, in the 6th Report the Commission redefined broadband as “a transmission service that actually enables an end user to download content at speeds of at least 4 megabits per second (Mbps) and to upload content at speeds of at least 1 Mbps . . .”

The FCC already knows that, under this new definition, somewhere between 14 million and 24 million Americans are unserved by broadband. It also knows that areas of low population density and low income are often the last to receive service, whether it is cable or broadband or anything else. With that in mind, the crux of the 7th NOI lies in the FCC’s comment: “Should we consider affordability as a component of broadband availability?” The Commission appears to be asking whether broadband should still be deemed “available” if a provider offers it, but at too high a price for local residents to manage.

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Channel 13 leaves VHF ranks, migrates to UHF, according to some FCC reg fee materials

Here’s another CommLawBlog Reg Fee Tip: if you received one of the FCC’s snail mail reg fee notices, be sure to take it with a grain of salt. It has come to our attention that the fees indicated in those notices may be wrong. 

Not wrong as in incomplete because, say, they didn’t include fees for auxiliary licenses and the like. We knew about that problem (and have mentioned it here before).

No, we’re talking wrong as in, um, wrong. In particular, a number of TV licensees operating on Channel 13(maybe even all Channel 13 stations – we haven’t checked with everybody) have received notices advising them that they owe a reg fee calculated on the basis of the fact that they are operating on a UHF channel. (For any Doubting Thomases, here’s an example, from which we have redacted the identity of the specific station/licensee. We have more where this came from.)  

Hmmmm. Last time we looked, Channel 13 – i.e., the space on the RF spectrum encompassing 210-216 MHz – was in the VHF band, at least as that band is defined by, e.g., the International Telecommunication Union. And the FCC has historically taken the same position (probably because it’s got to, physics being what they are and also being as how the U.S. has been a member of the ITU for more than 100 years now). So unless there’s been some phenomenal warp in the spacetime continuum – like, maybe, a wormhole or something – that might have resulted in Channel 13 growing little RF legs and scurrying over to the UHF band, it’s safe to assume that 13 is still a V and any FCC notice suggesting the contrary is incorrect.

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FCC expands access to wider range of hearing aid-friendly devices 

In a wide-ranging “Policy Statement and Second Report and Order and Further Notice of Proposed Rulemaking” (Order), the FCC has taken the expected step of expanding the universe of devices covered by its Hearing Aid Compliance rules, and at the same time has sought comments on measures that would extend the reach of its rules even further. Its goal is to ensure that hearing-impaired folks will have access to “innovative and advanced” handsets that will assist them in “participat[ing] fully in the American economy and society.”

Since 2003, the FCC has been slowly ratcheting up the quantity and quality of wireless handsets which must be made available to persons with hearing problems. The Commission has for years required equipment manufacturers to produce, and CMRS carriers to provide, certain numbers or percentages of hearing aid compliant (HAC) handsets as part of their offerings to the public. In 2008 the Commission mandated phased-in increases (through 2011) in the percentages of available HAC handsets; it also specified how many “acoustic coupling” or “inductive coupling” units had to be available to customers. (Acoustic coupling amplifies sound from the handset device while inductive coupling effectively creates a new audio receiver in the hearing aid from the telephone unit, reducing feedback and undesired ambient noise amplification.)

The FCC also requires annual reports in which carriers must detail the dates and quantities of each type of HAC unit they offer.   Enforcement of the rules has been unusually vigilant and stern, with many carriers receiving five-figure fines for falling a phone or two short, or even for simply failing to file the required report.  (The Commission has gone so far as to threaten such non-telecom companies as 7-Eleven and Circle K with hefty fines for failing to file HAC reports – since both 7-Eleven and Circle K stock prepaid handsets for their customers.)  

Clearly, the FCC means business when it comes to HAC phones.

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. . . but you’re STILL required to pay reg fees for them, or else

Reminder to all you DIY reg fee filers: The FCC’s handy “Look-up Website” is not so handy when it comes to broadcast auxiliary licenses (licenses for, e.g., studio-transmitter links, remote pickups, etc.). When you query the “Look-up” for the fees you owe, it does not include records for auxiliaries. This can be problematic because Fee Filer will not necessarily pull up your auxiliary licenses when you punch in your FRN, either. (Our Fee Filer experience on that score has been at best hit-and-miss.)

There is a $10 reg fee for each auxiliary license that the FCC has you down for. In other words, if the FCC thinks you have an auxiliary, you owe the fee for it, even if it turns out that you don’t use that particular auxiliary and might even have forgotten about it. Because of that, it’s always a good idea to check both your records and the Commission’s, to make sure you have an accurate handle on just what licenses (auxiliary and otherwise) you’re on the hook for. And then, of course, you should be sure to include those licenses when paying your fees.

Failure to pay the fee for auxiliaries can end up being costly down the road. The late fee (25% on each late $10 auxiliary reg fee) is probably not going to kill you, as long as the lateness is limited to auxiliaries. But failure to pay any reg fee can trigger the FCC’s Red Light Rule, which can in turn have unpleasant, and possibly dire, consequences down the line.

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The cash registers are opened for business at the FCC’s 2010 Reg Fee Extravaganza. The lines form to the left.

On Friday, August 6 (or possibly sometime late the day before), the Fee Filer site started displaying 2010 reg fees. There was an administrative lag between the FCC’s announcement of the deadline for this year’s reg fees and when you could actually pay them. Suffice it to say, you can pay them now. 

If you’re the adventurous sort and have confidence that by starting early enough and showing an adequate grasp of basic Internet skills, you will for sure avoid the 25% late fee payment that comes when you don’t get in the door with your fee by 11:59 p.m., Eastern time, on August 31, go to the Fee Filer page, enter the licensee’s FRN and password, and knock yourself out. If you would like help, call us.

Note that the Commission has provided a handy-dandy “Look-up Website” for Media Services Licensees. It not only lets you check what fees you owe, but it also lets you see whether or not the FCC’s records reflect that you’re exempt from paying anything. Generally, all non-profit entities (even those that happen to operate commercial broadcast stations) are exempt. 

Interestingly, if you think you’re exempt but the “Look-up Website” says otherwise, there is no way you can straighten that out online. In previous years, it was possible to claim an exemption with a couple of clicks. No more. Now you are required to email or fax documentation establishing your exemption to the Commission. (Appropriate documentation could include “a copy of your IRS determination letter showing your IRS section 501(c) tax exemption status, or state or government certifications, or proof of your station’s noncommercial educational (NCE) broadcast status at the FCC.”)

Remember, the fact that the fees are due by August 31 simply means that you will be able to enjoy that long Labor Day weekend with peace of mind.

Good luck.

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Boucher bill boosts boatloads of big bucks for broadband build-out in boondocks

One more element has been added to the full-court governmental press aimed at extending broadband to as many people as possible: a bill recently introduced in the House would reform the 13-year-old, multi-billion dollar Universal Service Fund (USF). The proposal would (among other things) explicitly declare high-speed broadband to be a “universal service” and, therefore, eligible for subsidization from the USF – thus freeing up boatloads of big bucks for broadband build-out in the boondocks. Dubbed the “Universal Service Reform Act of 2010”, the bill is a bipartisan effort sponsored by Reps. Rick Boucher (D-VA) and Lee Terry (R-NE).

The USF was created by the 1996 Telecom Act, but its roots go deeper than that – back at least to 1934, when the FCC was born. The U.S. has sought to assure that every American has access to essential telecommunications services. Historically, such services have entailed mainly standard old telephone service. Putting the consumer’s money where the government’s mouth is, the 1996 Act provided for the establishment of a fund (the USF) to be used to subsidize the provision of affordable telecommunications services in certain circumstances. 

USF subsidies go to: (a) “high cost” areas, mainly rural and sparsely-populated in nature, where delivery of service could otherwise be prohibitively expensive; (b) low income consumers in need of basic local phone service; (c) rural health care providers for both telecom and Internet services; and (d) schools and libraries, to assure access to various telecommunications services. Subsidies for each of these groups are managed by separate divisions within the Universal Service Administrative Company, the non-profit corporation established to oversee the day-to-day operation of the USF. (The USF gets its funds from telecommunications providers, who in turn get the funds from their customers.)

The Boucher-Terry bill focuses primarily on the USF program for delivering telecom services to “high cost” areas.

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We have previously reported on the FCC’s monumental Report and Order (R&O), adopted last May, which balanced technical interference considerations between the Satellite Digital Audio Radio Service (SDARS) and the Wireless Communications Service (WCS). After several errata correcting issues in the FCC’s first release, the FCC has finally published the R&O in the Federal Register, which in turn establishes the effective date for some – but not all – of the revised rules. That effective date is September 1, 2010.

The effective date does not apply to all the changes. The FCC expressly excepted from that effective date several rules which require further review from the Office of Management and Budget (OMB) before they can go into effect. Most of the delayed rules relate to newly-revised licensing and notice requirements. 

Of particular interest to WCS licensees are the new and very strict substantial service standards applicable to current and future WCS licensees. We described those standards, which are now set forth in Section 27.14(p) of the rules, in a recent article in our publication, FHH Telecom Law. The substantial service standards will  become effective on September 1, but the certification requirement contained in Section 27.14(p)(7) – i.e., the obligation of WCS licensees to notify the FCC that they have complied with the standards – is not currently subject to that date. So WCS licensees must start the process of bringing themselves into compliance with the substantial service standards, but need not (at least for the time being) certify their compliance to the Commission. Revised Section 27.14(p) is worded to give licensees until March 4, 2013 – a date certain – to achieve the new substantial service benchmarks.   Thus, the clock is already ticking with respect to compliance with those benchmarks.

Parties wishing to challenge the R&O now have until September 1 to file petitions for reconsideration.   Petitions seeking reconsideration of at least several elements of the R&O, including the substantial service requirements, are expected.

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The race is apparently on down on Capitol Hill to make sure that the FCC has the authority to share spectrum auction proceeds with licensees who are willing to give up the spectrum to be sold off, presumably for broadband purposes. Late last month we reported on S. 6310, the Kerry-Snowe bill introduced in the Senate, which includes a provision for proceeds sharing. Now, Reps. Boucher (D-VA) and Stearns (R-FL) have tossed in the Voluntary Incentive Auctions Act of 2010 (H.R. 5947) which would accomplish the same purpose. But, unlike the Kerry-Snowe bill, the Boucher-Stearns bill contains nothing about spectrum fees.

To the contrary, H.R. 5947 is short, sweet and to the point. It would give the FCC the authority (which it currently lacks) to share spectrum auction proceeds with any licensee who agrees “to participate in relinquishing voluntarily” its rights to the spectrum. While the bill leaves the precise mechanism for the sharing (as well as the amount or percentage of auction proceeds to be shared) to the Commission’s discretion, the Boucher-Stearns proposal makes one thing clear: any relinquishment of spectrum must be voluntary. The bill includes “voluntary” in its title, and then again in the heading of the new one-paragraph section that would be inserted into the Communications Act. And that paragraph includes “voluntarily” not once, but twice. 

And just to make sure that there’s no doubt here, the bill contains a section that: (a) prohibits the FCC from “reclaiming” for auction purposes any TV spectrum “directly or indirectly on an involuntary basis” and (b) emphasizes that nothing in the bill “shall permit, or be construed as permitting” the FCC to do so.

Fleshing out just what he had in mind when he used the term “voluntary”, Rep. Boucher explained in his introductory statement that, in his view, imposition of “a spectrum fee that would make some licensees financially unable to keep their spectrum would make the spectrum surrender constructively involuntary and would be impermissible under the terms of our legislation.” 

So it’s apparently not far-fetched to figure that a spectrum fee (such as the one proposed in the Kerry-Snowe bill in the Senate) might be used to squeeze broadcasters into handing over their spectrum. All the more reason to keep a careful watch on what goes on down on Capitol Hill in coming months.

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It’s official!!! The deadline for filing reg fees this year is August 31.  We sure hope you didn’t have any plans for an end-of-summer get-away around then.  (If you did, don't forget to bring along your FRN password, the Fee Filer URL and a credit card.)

The Commission is required by statute to impose a hefty late fee amounting to 25% of any untimely fee, so now would be a good time for everyone to mark their calendars with a reminder to get their fees into the Commission by August 31.

Fees can be paid on-line through the FCC’s Fee Filer system. Electronic filing provides a quick and relatively simple way of getting the job done, as well as an instant proof of payment – which can come in handy in case any question arises about the timeliness of payment. Fee payers who choose to use snail mail do so at their own peril.

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Auction pay-outs for repurposed spectrum, annual spectrum fees enter the legislative debate in Kerry-Snowe bill

In March, 2009, we reported on S. 649, a Senate bill that would have required the FCC and NTIA to undertake a “radio spectrum inventory”. A year later that bill was reported out of the Senate Commerce Committee and placed on the Senate Legislative Calendar. And there it sits.

But wait! Its sponsor, Sen. John Kerry, and one of its co-sponsors, Sen. Olympia Snowe, have just introduced yet another bill along the same lines. S. 3610, the “Spectrum Measurement and Policy Reform Act” popped up on July 19. According to Kerry, the new bill “tasks the FCC and the National Telecommunications and Information Administration (NTIA) to perform much needed spectrum measurements to determine actual usage and occupancy rates” – in other words, pretty much what last year’s version did. 

But wait, there’s more! The new bill – which weighs in at a hefty 27 pages, as opposed to last year’s two or so – provides for lots more than just a spectrum inventory: among other things, it opens the door for (a) the sharing of spectrum auction proceeds – an ominous harbinger of broadband-induced spectrum repurposing – and (b) even more ominously, the specter of annual spectrum fees.

 Of course, to read the Kerry/Snowe press release, you might not realize that.

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Despite U.S. efforts to ease entry into the Cuba market, no telecom gold rush has materialized – Por qué no?

It’s no secret that the Obama Administration would like to “reach out” to Cuba in the hope of bringing that island nation and the U.S. closer on a number of levels. One component of that effort involves increased telecommunications links between the two countries, as we reported last December. While it took the FCC a bit longer than other agencies to get with the program, by January the Commission had finally jumped on the bandwagon: as we reported then, the FCC eventually got around to relaxing its longstanding, restrictive policy on telecommunications to Cuba. Having discharged its duty, the Commission sat back and waited for a flood of international 214 applications which would lead to telecom rapprochement with the Cuban people.

This has manifestly failed to happen. Por qué? 

A number of theories and observations were tossed around by a panel of experts at a recent brown bag lunch presented by the Federal Communications Bar Association. Here, we summarize some of the major factors that, according to the panelists, are affecting and will likely continue to affect U.S.-Cuba telecommunications ventures.

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A month ago we reported on a Notice of Proposed Rulemaking (NPRM) through which the Commission is looking to impose greater consistency in its regulatory treatment of a range of wireless services. Those services have heretofore been subject to varying different regulatory approaches – without much apparent disruption or confusion among regulatees. The NPRM has now been published in the Federal Register, which in turn establishes the deadlines for comments and reply comments. If you want to submit comments, you have until August 6, 2010; reply comments are due by August 23.

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Final 2010 fees bounce back up, up, up from FCC’s initial lowball proposals

Remember how, back in April, when the FCC announced its proposed 2010 regulatory fees, we said that, historically, the final fees tend not to stray too far from the initial proposals? Silly us. The FCC has yet again proved us wrong by issuing its final 2010 reg fee schedule that strays dramatically from its April proposals. 

How dramatically? Perhaps the worst case scenario involves UHF TV licensees in Markets 1-10, who will see their reg fees skyrocket up by $6,975 over the rates proposed in April. Their UHF brethren in other markets above 100 will fare little better, with increases ranging from $3,325 to $5,225 over April’s proposals. 

Most radio licensees will also experience increases – the sole exceptions being Class B and D AM stations, who will remain at the levels proposed in April.

A handy table of the newly-announced final reg fees may be found here. The red figures in parentheses reflect the level of increase over the April proposals. The only fee (shown in green) that is reduced from the April levels is for AM construction permits.

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The classic smoke-filled room, hold the smoke

[Blogmeister’s Note: Don Evans, Editor-in-Chief of FHH Telecom Law, our newsletter about developments in the world of non-broadcast FCC regulation, has some thoughts of his own that he would like to share.]

I have no doubt that the meetings held at the FCC last week regarding the proper framework for regulation of the Internet were well-intentioned.   As has been widely reported, FCC Chief of Staff Ed Lazarus hosted a meeting at the FCC offices including AT&T, Verizon, Google, Skype, the Cable TV trade association, and the Open Internet Coalition to talk about Net Neutrality, among other things. When public interest groups and others objected that the FCC was brokering backroom deals with the power players while excluding everybody else, the FCC explained that it was “just trying to see if there is any common ground” among the disputing parties.   Fair enough.

But hold on just a second.

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Notice of Inquiry seeks definitions to help shape Third Way. We hope the FCC steps carefully in looking for answers.

When an appeals court here in D.C. overturned the FCC’s attempt to enforce “Net Neutrality” in April (reported here and here), the FCC had to come up with a new jurisdictional basis for its Internet policies. It needed a way to support not only the net neutrality rules it proposed in 2009, but also key elements of its proposed National Broadband Plan. As noted by my colleague Mitchell Lazarus, the FCC’s recently released Notice of Inquiry (NOI) attempts to craft a “just right” jurisdictional answer. The proposed “Third Way” is offered as a compromise between an overly burdensome, telephone-type Title II approach, and the Title I approach rejected by the Comcast court. In the process, the NOI raises – both intentionally and otherwise – revealing and challenging questions.

Trouble from the Start

Even a careful reading of the NOI leaves largely unanswered a basic question: What service is the FCC trying to regulate? The stated goal in the NOI is to define a pure Internet connectivity service which the FCC would regulate a “telecommunications service”. (The remainder of Internet access would be left under the current classification of “information service”.) But defining that narrow connectivity service will not be easy, and may not even be possible.

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Facing a communications universe well beyond anything contemplated by the drafters of the Communications Act in 1934, or even the authors of the 1996 update, the FCC has been forced to improvise – most recently by taking a page from Goldilocks, looking for a “third way” that’s Just Right. On June 17, the FCC took the first formal step in what is likely to be a contentious process intended to determine how, if at all, the FCC will regulate the Internet.

But before we lift the curtain on the next episode of the drama, let’s recap:

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In WRS rulemaking, FCC will try to resolve issues of “renewal expectancy” and the “comparative renewal” process

As part of its ambitious rulemaking looking to impose consistency across a wide range of radio services, the Commission has set its sights on solving a vexing problem involving license renewals in the Wireless Radio Services (WRS), a fairly large universe encompassing “all radio services authorized in parts 13, 20, 22, 24, 26, 27, 74, 80, 87, 90, 95, 97 and 101…whether commercial or private in nature.” The problem: How to deal with applications for new licenses which are filed against (i.e., mutually exclusive with) applications for renewals of existing licenses.

At a time when the Commission’s resources are focused on finding vacant or underused spectrum to feed the broadband beast, the WRS proceeding runs smack into a core issue that has resisted resolution for decades: how to determine the “renewal expectancy” to which a license renewal applicant may be entitled, and how to assess the weight of that expectancy against a competing applicant. While “renewal expectancy” historically received considerable attention in comparative renewal proceedings relating to broadcast licenses, the issue has now arisen in the WRS context.

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But the FCC wants to know, and is willing to put consumer privacy at risk to find out.

The FCC cares deeply about broadband. We know that because it released a 360-page report called The National Broadband Plan and set up a website called www.broadband.gov. Also, the Commissioners nowadays pepper their speeches with references to the importance of broadband.

Harder to find is evidence of similar interest outside the Beltway. Or even outside FCC headquarters. When the FCC went looking, it found mostly apathy.

The FCC conducted a survey of broadband service. Not of how many people receive broadband, or what speeds they get, these being issues the FCC has long tracked. Rather, it looked into whether people know their broadband speeds. In case the importance of this datum is not obvious (it wasn’t to us), FCC Chairman Julius Genachowski explains: “The more broadband subscribers know about what speeds they need and what speeds they get, the more they can make the market work and push faster speeds over broadband networks.”

If the Chairman is right, the market is not working. Eighty percent of U.S. broadband users do not know the speed of their Internet connections. We are shocked! Well, not really, but we might be shocked if were not part of the ignorant 80%.

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NPRM proposes uniform provisions for renewal, cancellation, partitioning, disaggregation.

When the FCC first opened its doors, back in 1935, there were just two kinds of radio service: AM broadcast and maritime. That made for simple regulations. But the inventors stayed busy over the ensuing years, and the FCC kept busy, too. As each new kind of radio service appeared, the FCC added a new section to its rules. The services and the rule sections each now number well up into the dozens.

Most of the licensing rules address common issues: who is eligible; how to apply; duration of the license term; when construction must be complete and/or service offered; renewal requirements; and so on. But the details on these items vary from one radio service to another.

Such differences do not seem to cause a lot of trouble. Most companies with FCC licenses have only one or two kinds. Either they know the applicable rules, or they have an advisor or supplier who does. When people get on the wrong side of the FCC, it is rarely for confusing one section of the rules with another.

Even so, the FCC thinks more uniform rules might promote efficient spectrum use, give certainty to licensees, encourage investment, and facilitate planning. Defying Ralph Waldo Emerson,  it has now proposed imposing greater consistency in the rules on renewal requirements, discontinuation of service, and licensees’ obligations following partitioning and disaggregation across a wide range of wireless services.

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A couple of weeks ago we reported on the FCC’s Notice of Proposed Rulemaking (NPRM) looking to overhaul the Commission’s regulation of towers, er, we mean “antenna structures”. The NPRM has now been published in the Federal Register, which establishes the deadlines for comments and reply comments in response to the NPRM. Mark your calendars: comments are due by July 20, 2010; reply comments are due by August 19, 2010.

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Changing phone carriers? Keeping the same number? You have friends at the FCC

For several years now, consumers have been able to keep their telephone number when changing telephone service providers, making it easier to switch from AT&T’s iPhone to Verizon’s Droid phone and back again without having to change your number each time. You can even switch the same number between wireline, and wireless, and VoIP carriers. The problem has been that while intercarrier number “ports” take only a day between wireless carriers, they take up to four days when a wireline carrier is involved.

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Conservation groups, tower groups agree on some interim standards for public notice of ASR applications; FCC reaction awaited

As the FCC tries to get a grip on its overall regulation of antenna structures (we recently reported about those efforts here), there is a ray of hope that one historically contentious aspect of the tower registration process may be heading toward a compromise solution. Earlier this month, a Memorandum of Understanding (MOU) was signed by several communications industry groups and several conservation groups. In their MOU the parties propose some interim processing standards for the FCC that might break a years-long impasse, and result in new procedures (interim, at least for now) governing the regulation of new tower construction.

The issue here is, for the most part, birds.

Since way back in 2001, conservation groups (including the American Bird Conservancy and the Forest Conservation Council) have been pushing to get the Commission to take steps to help save birds in the Gulf Coast region. They claimed that bird collisions with communications towers kill millions of birds annually – just the kind of thing that the National Environmental Protection Act (and the Endangered Species Act and the Migratory Bird Treaty Act) were designed to address. 

However, the Commission’s relatively loosey-goosey (to use technical avian terminology) approach to tower regulation provided no mechanism for any potential objectors to bring such concerns to the FCC’s attention before any tower was constructed. While many towers are subject to the Commission’s Antenna Structure Registration (ASR) program, the registration process has historically not included any pre-registration public notice of proposed construction. In a 2002 petition, the bird fanciers asked that the Commission start issuing such pre-registration notice; they also argued that the Commission should have undertaken separate environmental assessments for about a gazillion towers already built throughout the Gulf Coast region.

The Commission looked into the claims preliminarily, but ultimately decided to consider bird-related issues on a nation-wide basis (not just in the Gulf Coast). The birder groups were not inclined to wait, and they sought judicial intervention. In 2008, the U.S. Court of Appeals for the D.C. Circuit landed on the side of the avian avengers. The Court concluded that the FCC needed to straighten up and fly right, with more notice to the public and better consultation with the Fish and Wildlife Service, among other things.

The Commission has had the matter under advisement since then.

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Yesterday we reported that the FCC has initiated a couple of proceedings relating to video connection/navigation devices. Both the Notice of Inquiry (NOI) and the Notice of Proposed Rulemaking (NPRM) have now been published in the Federal Register. As a result, the comment period deadlines for both are now set. 

Comments in response to the NOI are due by July 13, 2010 and reply comments are due by August 12, 2010. 

Comments in response to the NPRM are due by June 14, 2010 and reply comments are due by June 28, 2010. You may also file separate comments with respect to the proposed “information collection” aspects of the proposed rules described in the NPRM; those “PRA” (short for Paperwork Reduction Act) comments are due by July 13, 2010.

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FCC looks to shuffle the video navigation deck from CableCARD to AllVid

In recent years, the number of new avenues to connect to the Internet for video programming has grown exponentially. Driving this, of course, is the availability of more and more video-based distribution services out there that will deliver video to the comfort and privacy of your living room. While folks previously watched YouTube only on their computers, recent technological developments have given us internet-accessible DVRs, Blue-Ray disc players, and gaming devices such as Wii and PlayStation that can access and deliver video programming from Netflix, Pandora, and Hulu. Even televisions themselves are being manufactured to access the internet and relay programming to the home viewer.

In this atmosphere of rapid growth, the Commission recently released two notices relating to set-top boxes and their progeny. The basis for the Commission’s interest in this area is the requirement contained in Section 629 of the Communications Act, which gave the Commission authority to develop rules to spur the development of devices used for multichannel video program distribution (MVPD). The over-arching goal was the creation of a free, open and competitive market for video connection devices similar to that which developed for CPE (“customer-provided equipment” or “customer premises equipment”) when the telephone network was thrown open to non-Bell devices.

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Tweaks what?? (We had to look it up, too.)

Another in our continuing series of items that, frankly, some of us here think are pretty obscure, but which are doubtless of vital interest to somebody, somewhere.

Most of the 1.9 GHz PCS spectrum is earmarked for voice and text cell-phone service, and very widely used. But the FCC also set aside 20 MHz at 1910-1930 MHz for unlicensed operation. The sub-band at 1920-1930 MHz, used mostly for cordless telephones, is subject to the rules at issue here.

Unlike most unlicensed bands, 1920-1930 MHz has a “listen before talk” requirement.  A device must monitor a channel before using it, and can transmit when signal levels are below a certain threshold. If the unit has monitored at least 40 channels and found signals to be too high on all of them, it can transmit on the quietest, so long as the activity there is below a second, higher threshold.

The FCC proposes to change these rules.

One change would raise the first threshold that makes a channel available for operation, so that a unit is more likely to find a channel it can use.

Another change would reduce the number of channels that device must check from 40 to 20. This would allow the use of wider channels, and hence make the band more suitable for broadband transmission. (Practitioners’ tip: nowadays every proposal for an FCC rule change should include the word “broadband”.)

The FCC also proposes to: remove a rule section on coordination with the microwave fixed service, which no longer uses the band; drop a corresponding labeling requirement; and make other conforming and administrative changes.

Comment and reply dates have not yet been announced.

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Commissioners signal intent to impose modified Title II common carrier regulation on broadband Internet

This FCC is not letting any grass grow under its feet. Only a month ago, the U.S. Court of Appeals for the D.C. Circuit pulled the rug out from under the FCC's authority to regulate the Internet. In the intervening weeks, there was much speculation about what the Commission should or would do to bring the Good Ship Internet back on course.   Suggestions included turning the entire matter over to the Federal Trade Commission, seeking a change in the Communications Act to expressly grant the FCC the authority to regulate the Internet, appealing to the Circuit Court en banc or the Supreme Court to reverse the Comcast decision, or trying to more solidly justify its ancillary authority over the Internet.  

The most widely discussed option, however, was simply re-classifying broadband Internet access as a telecommunications service. 

While this would require some major backtracking by the Commission (it had previously solemnly declared broadband Internet access to be an “information service” and thus exempt from Title II regulation), it is not uncommon for administrative agencies to change their minds.   The re-classification would deposit broadband Internet access safely back in the nest of common carrier services which no one disputes the Commission has authority to regulate. The only question then would be whether to employ the heavy hammer of full Title II monopoly style regulation or the light feather of minimal regulation applied to wireless carriers, or something in between.

On May 6, the Commission telegraphed which way it’s going, but it did so not by an official order but by a flurry of battling press releases.

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FCC looks to overhaul antenna structure strictures.

You know how people have been telling you for, like, years that you really ought to clean out your refrigerator? And when you finally get around to it, you find (among other things) that those fuzzy things that look like a science experiment sprouting behind the old jar of maraschino cherries at the back of the top shelf have sell-by dates that went by several years ago?

That’s what the FCC is experiencing right now – but instead of its refrigerator, what needs cleaning up are the rules governing antenna structure construction, lighting, marking and maintenance. 

And so the Commission has released a Notice of Proposed Rulemaking (NPRM) looking to overhaul its tower-related rules, which comprise Part 17 of the rules. While the Commission specifies a number of particular changes it has in mind (see below for examples), the proceeding appears to encompass the entire regulatory scheme of Part 17. Anyone who has an antenna structure or expects to build one may want to take the opportunity to offer their suggestions, since history suggests that, once the structure rules are revised, they’re likely to stay that way for a while.

The FCC, of course, has long required all of its regulatees to comply with various non-RF related aspects of their antenna structures.  (Insider tip: While you may want to refer to them as “towers”, don’t; the government prefers the more elegant term “antenna structures”.) And it routinely issues forfeitures for non-compliance with, e.g., lighting and painting specifications. The goal is to keep aviators and aviation passengers from flying into those structures.

But because the focus here is on aviation, the FCC shares antenna structure responsibilities with the Federal Aviation Administration (FAA). Historically, the FAA has set most of the substantive standards (for, e.g., lighting and painting), even though the FCC has the responsibility for enforcing those standards.  But the two agencies apparently don’t coordinate as well as they might – and, as a result, discrepancies between the FAA’s requirements and their FCC equivalents can develop.

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FCC Chairman moves to re-regulate broadband Internet transport function, but network neutrality may fall by the wayside.

Stymied by the Comcast decision in his efforts to impose network neutrality, Chairman Genachowski is asking the FCC to back up and come at the problem again, this time from a different angle. He calls his approach “the Third Way.” The other two Ways, both rejected, consist respectively of too little and too much regulation. So we think instead the Chairman should name his choice the Just Right Way. But the name is not its only problem.

From a regulatory standpoint, Internet service is a combination of two very different things. One is the provision and selection of content, called an “information service” (IS, for brevity). The other is the transport of that content between the Internet provider’s facilities and the customer’s phone or computer, a function termed a “telecommunications service” (TS). Any FCC power to regulate IS comes from Title I of the Communications Act, which provides its somewhat vague authority to regulate wire and radio communications generally.  But when the FCC first drew the IS/TS distinction – in the pre-Internet days of the 1970s – it forbore from regulating IS.

By contrast, the Commission then chose to regulate TS under Title II of the Act, the same statutory regimen that governs telephone service. Title II unquestionably gives the FCC enormous authority over rates and conditions. Among other rules, the Commission required the phone companies to accommodate other Internet service providers on their dial-up phone lines (and still does). The resulting competition effectively prevented any dial-up provider from short-changing its customers on content.

When broadband arrived, the FCC made a drastic change. It treated IS and TS as one combined service subject to the same regulatory approach as IS – i.e., under Title I only. Soon afterwards, Comcast began to selectively interfere with customer content; the FCC ordered it to stop (in the name of net neutrality); and Comcast challenged the order in court. 

In defending against that appeal, the FCC was badly constrained. Having relinquished Title II, it had to argue that the indeterminate language of Title I was enough to support network neutrality rules. And since Title I has no actual words on the subject, the FCC could rely only on the claim that Title I provides it “ancillary” authority. Wrong, said the court, to the joy of cable companies and phone companies everywhere.

Now Chairman Genachowski is looking for some way out of the hole. And that way is the Third Way.

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The aftershocks of Comcast could reach well beyond broadband and net neutrality

While most attention on the aftermath of the Comcast decision has tended to focus on the decision’s impact on net neutrality and the implementation of the National Broadband Plan (NBP), the seismic wave from Comcast and its aftershocks could reach well beyond those obvious targets. Local TV broadcasters, in particular, might want to pay attention to how Comcast might play out in their corner of the regulatory universe.

 For example, the NBP contemplates that spectrum currently in use by TV stations might be re-purposed for broadband. To wrest that spectrum away from the television operators who now hold it, the Commission has suggested that it might work some kind of deal in which: (a) the spectrum would be “voluntarily” relinquished by the broadcasters; (b) the re-captured spectrum would then be auctioned off; and (c) the broadcaster would be entitled to a portion of the auction proceeds.

But the FCC’s authority to cut this kind of deal in any event is far from clear. While the Commission is unquestionably authorized to conduct spectrum auctions, that authority does not obviously extend to cutting deals to kick-back auction proceeds to private parties. And any hope that such deals might be seen as “ancillary” to other authority is dimmed by Comcast.   That in turn means that the FCC’s ability to secure spectrum commitments from broadcasters is likely diminished. Why, after all, would a broadcaster commit to turning in its spectrum if the FCC is not in a position to guarantee any repayment that might be part of the deal? As a result, the Commission should not expect much enthusiasm from broadcasters unless and until the Commission can demonstrate that it will be able to make good on any payment deals it may try to cut.

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A couple of days ago we reported on an FCC order which (a) made changes in the rules regarding “home roaming” and (b) solicited comments on whether automatic roaming for data services should be required. The order (broken out into two separate parts) has now been published in the Federal Register. That publication has two effects. First, it establishes the effective date of the change in the “home roaming” rule. Mark May 28, 2010, on your calendar for that.

And second, it sets the comment and reply comment dates with respect to the data roaming questions. Comments are due by June 14, replies by July 12.

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Looking for net neutrality authority at the FCC? You might be one letter off. 

[Blogmeister’s Note: CommLawBlog.com welcomes back guest blogger Catherine McCullough, principal of Meadowbrook Strategic Government Relations, a D.C. lobbying firm. We are pleased that Catherine has agreed to share with our readers her thoughts on how the Administration might deal with its Comcast problem.]

Across the post-Comcast playing field, the governmental players are staking out their positions on the question of who, if anybody, has the authority to enforce network neutrality. 

A recent hearing before the Senate Commerce Committee provided examples: Chairman Rockefeller, emotionally describing how lack of service affected his constituents during the recent West Virginia coal-mining disaster, said he will put his considerable power behind writing a bill to give the FCC unambiguous authority to protect consumers; Ranking Member Hutchison – who doesn’t have the final say over any majority bill now, but whose party could hold all the cards if elections go Republicans’ way in November – warned the FCC that there would be consequences if it acted to reclassify. 

And in an exercise I’ve seen repeated in that Committee room by other agency leaders, Chairman Genachowski stuck to his written testimony and gently tiptoed around the hard questions (like how the FCC might plan to make the National Broadband Plan a reality given the new hazy regulatory climate).

If you were Mr. Genachowski, how would you deal with the conundrum of network neutrality in the aftermath of Comcast?

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FCC requires reasonable home roaming for voice services, invites comment on mandatory automatic roaming for data services

In an Order/Further Notice of Proposed Rulemaking adopted at its April 21 meeting, the FCC slightly modified its current rules on the obligation to provide automatic roaming to other CMRS carriers, while temporizing on the question of whether to extend automatic roaming privileges to data services.

The modest change concerns the elimination of “home roaming” as an exclusion from the usual automatic roaming rule applicable to voice, SMS and push-to-talk services. In 2007 when the FCC originally declared that the enabling of automatic roaming was a common carrier obligation, it carved out an exception for home roaming.  Home roaming, of course, refers to the situation where a carrier’s customers roam on another carrier’s network while they are in their home carrier’s licensed service area – not at all the circumstance that roaming is usually thought to apply. 

The exclusion of home roaming from the roaming mandate made a certain sense. If carriers could simply have their own customers roam on their competitors’ networks in markets where they themselves had licenses, there would be no incentive for them to build out the portions of the market that would be difficult or expensive to reach or serve. They could simply piggy-back on their competitor by having their subscribers roam in the remote parts of their service areas where the competitor had spent the time, money and effort to erect facilities. This seemed to run counter to the Commission’s policy of fostering facilities-based competition wherever possible.

Nevertheless, a gaggle of Tier II and Tier III carriers sought reversal of this decision, vigorously opposed by AT&T and Verizon. It seemed that the smaller carriers were licensed in many territories where it was infeasible to serve all or part of the territory, at least for the immediate future.  In the meantime, the home roaming exclusion gave AT&T and Verizon the right to forbid roaming altogether in those markets, putting the junior carriers at a significant competitive disadvantage.

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FCC suggests, seeks comments on, harsh new standards for WCS licensees

Of the many, many tasks which the FCC has set for itself in its National Broadband Plan (NBP), attentive readers may have noted one in particular. At page 86 of the NBP, the FCC committed to “accelerat[ing] efforts to ensure that WCS [Wireless Communications Service] spectrum is used productively for the benefit of all Americans.” We had to smile at the use of the word “accelerate” in this context since the FCC has been doing precisely nothing for the last 13 years to bring this spectrum to productive use.   In fact, in contravention of its own rules it has been sitting on applications for almost three years which could already have been providing innovative WCS service. The NBP is striking in that regard, since it repeatedly fails to acknowledge how the Commission’s own inaction and irresolution have often stymied, thwarted or delayed the very objectives which the FCC now claims to be so urgently needed.

Be that as it may, the FCC – while still leaving incumbent WCS licensees and new applicants in limbo – has now requested comment on some very rigorous build-out standards for the 2.3 GHz WCS service.  

Currently, licensees in this service need demonstrate only that they have provided “substantial service” at the end of their ten-year license term.  The term “substantial service” has not been defined with any specificity; instead, the Commission has invoked the ancient formula of “service which is sound, favorable and substantially above a level of mediocre service that just might minimally warrant renewal”. Still, the FCC did deign to identify a few reasonably delineated safe harbors that licensees could rely on: for mobile and point-to-point uses, service to 20% of the population would be deemed “substantial”; for fixed point-to-point uses, service to four links per million of population would do the trick.

But now, apparently determined to bring WCS spectrum to productive use, the FCC is proposing to swing 180 degrees from those relatively liberal build-out requirements and instead impose requirements that are among the harshest ever.

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FCC launches five – uh, make that six – NBP-related items in one day

If you thought the FCC might have been kidding around when it promised quick action on the National Broadband Plan (NBP) agenda items, the FCC is working hard to move you off that thought. In an impressive display of regulatory shock and awe, the FCC has put a substantial dent in its NBP to-do list by launching six separate proceedings covering five discrete subjects. The items include:

•  A notice of inquiry (NOI) and notice of proposed rulemaking (NPRM) on Universal Service Fund reform
• A notice of proposed rulemaking on whether to extend roaming obligations to mobile data services
• A notice of inquiry on the “survivability” of America’s broadband infrastructure
• A notice of inquiry on a proposed “Cyber Security Certification Program” for communications service providers
• A notice of inquiry and a separate further notice of proposed rulemaking on cable and satellite set-top boxes

The six items top out at a total of just over 250 pages in all, so you might want to start reading now.  If you just want to get a quick sense of what each involves, you might want to check out the public notices which recap each: Universal Service Fund; Roaming Obligations; Survivability; Cyber Security Certification; and Set-top Boxes.

 Each of the six items invites comments and reply comments, but don’t get your calendars out yet. The comment deadlines won’t be set until the various notices are published in the Federal Register. And to make it even trickier to start planning your early summer get-away, the Commission appears to contemplate an oddly diverse set of deadlines. For example, comments and replies in response to the Set-top Box NOI will be due a scant 30 days and 45 days, respectively, after that notice makes it into the Federal Register.  By contrast, comments/replies in the Cyber Security Certification proceeding won’t be due until 60/120 days after publication. And in between you’ve got the Set-top Box NPRM and USF combo NOI/NPRM (60/90 days for each), and the Survivability NOI and Roaming NPRM (45/75 days for each).

With this barrage – or is it a salvo? – the Commission is clearly signaling its determination to move forward with the ambitious campaign mapped out in the NBP, despite the major questions which loom large in the wake of the FCC’s setback in the Comcast case.  And don’t get comfortable, because these are just the beginning.  The NBP envisions more than 60 proceedings in the months to come.  Stay tuned . . .

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Cell phone jammer company assessed $25,000 for two Internet sales

We have written elsewhere about the irritations of other people using cell phones in public places. Technology, having caused this problem, also offers a solution: widely available on the Internet are jammers that silence phones nearby, and sometimes at a considerable distance.  We Googled “cell phone jammer” and found dozens of places selling them.

Some outfit calling itself the “Federal Communications Commission” has declared jammers to be illegal. Recently it levied a fine of $25,000 against a company with the unwisely chosen name of “phonejammers.com” that offers them on the Internet. (This is like putting a license plate on your car that says SPEEDER.) The company denied marketing in the United States, but the FCC found two in use that the company had sold. Both were relatively high power, as jammers go – five and eight watts respectively. The five-watter, used by a Texas cosmetology school, resulted in a local cell phone provider lodging interference complaints; the other interfered with calls to and from a sheriff’s office in Florida. One suspects the users had these cranked up a lot higher than was needed to protect the immediate premises.

Ironically, in both Texas and Florida it is legal to openly carry firearms into a Starbucks, say. But not a phone jammer. So when the cell phone at the next table erupts into The William Tell Overture and its owner bellows, “HELLO? HEY! YEAH, IN A STARBUCKS! IT’S RAINING HERE! SO WHERE’RE YOU?” pulling out the jammer is not an option. It’s the firearm or nothing. This may not be good public policy.

Yet the FCC runs roughshod over citizens’ inalienable right to enjoy a cup of coffee in peace. Phone your congressional representative to complain. But please, step outside to make the call. Especially in open-carry states.

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PSHSB invites comments on EAS overhaul to accommodate CAP-based system

Attention, anyone interested in the Emergency Alert System (EAS) – and that would include current EAS participants as well as wannabes. The Next Generation of EAS is in the works – and now’s your chance to influence it. The Public Safety and Homeland Security Bureau (PSHSB) has invited comments on possible changes to any or all of Part 11 of the Commission’s Rules. This invitation comes in anticipation of a rewrite of the EAS rules which will be necessary to accommodate the Common Alerting Protocol (CAP) standard.

CAP standard? Surely you remember back in 2007, when the FCC notified all EAS participants that they must be prepared to accept CAP-based EAS alerts 180 days after FEMA publishes the applicable CAP technical standards.  FEMA recently announced its intention to publish those standards as soon as the third quarter of 2010, so time is now of the essence for the FCC to get all of its EAS ducks in a row.

So what is this CAP thing, really?

 According to the FCC, CAP is as “an open, interoperable, data interchange format for collecting and distributing all-hazard safety notifications and emergency warnings to multiple information networks, public safety alerting systems, and personal communications devices.”  It’s part of the federal government’s deployment of the Integrated Public Alert and Warning System (IPAWS). The goal of IPAWS is to allow officials who have to respond to emergencies – think FEMA, the National Weather Service, State Governors, other public safety officials –to get the word out to the public about emergency situations as efficiently and comprehensively as possible. In the old days, such officials generally had to rely on the broadcast EAS system. Now, in addition to EAS, the CAP approach will ideally enable them to send a single, geo-targeted alert simultaneously across multiple platforms, including cellular, internet, satellite and cable television providers.  Instantaneous, ubiquitous notification to everybody, anywhere. The CAP approach will even enable special formatting of alerts for non-English speakers and persons with disabilities.

In other words, it’s EAS all grown up for the digital age.

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Short answer: Yes

According to Comcast v. FCC, the FCC came up short when it tried to show that it has the authority to regulate Comcast’s Internet access traffic management practices. To paraphrase the Vice President, this is a Big Deal – because the FCC’s ability to promulgate net neutrality rules is seriously threatened as a result. (Click here, here and here for analyses of Comcast’s impact on net neutrality.)

But the implications of Comcast go beyond that. They could, for example, gut the Commission’s regulation of Voice over Internet Protocol (VoIP) service.

The focus of Comcast was the scope of the FCC’s “ancillary jurisdiction”. (Check out my colleague Paul Feldman’s post for a cogent explanation of that concept.) The question boils down to this: if Congress hasn’t seen fit to expressly grant the FCC authority to regulate in a particular area, what regulatory actions, if any, can the FCC take in that area? In Comcast the court made clear that the regulation must be “reasonably ancillary to the Commission’s effective performance of its statutorily mandated responsibilities.” Importantly, the court held that mere statements of federal policy in the Communications Act are not “statutorily mandated responsibilities.”

VoIP allows consumers to make and receive telephone calls over the Internet. From the user’s perspective, VoIP is functionally the same as “plain old telephone service” (POTS).  Both allow the user to make and receive calls to and from points otherwise reachable by regular telephone. But the two are technologically different: POTS uses time division multiple access or analog switching to create circuits while VoIP uses session initiated protocol to send and receive messages in packets via the Internet and Internet Protocol. VoIP is basically no more than a software application. So, like any other software application, it isn’t subject to FCC regulation, right?

Not according to the FCC.

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If it’s Spring, it’s time for the FCC to propose new regulatory fees that will be payable in late Summer. And sure enough, the Commission has released its annual Notice of Proposed Rulemaking laying out a tentative fee schedule. The Commission invites comments on its proposals, but if you think you might want to throw in your two cents’ worth, you’ll have to act fast. The deadline for comments on the proposed fees is May 4, 2010; reply comments may be filed through May 11.

The good news is that, unless you’re a UHF TV licensee (or a VHF licensee in certain markets), you’re probably not going to have a problem with the proposed fees. All AM and FM license fees are proposed either to go down or to stay at last year’s levels. All VHF license fees for Markets 11-25 and Markets from 51 on down would also go down (as would the fees for all VHF CPs). No change is proposed for translators/boosters – FM or TV – or LPTVs; ditto for broadcast auxiliary licenses. UHF CPs would go up (but only by $75), as would AM CPs (by $20), while FM CP would go down by $20.

All you full service TV operators – heads up. The Commission has previously exempted digital TV operations from reg fees because the DTV transition was still underway. As we all know, the transition was completed as of June 12, 2009, so we can kiss good-bye to the digital exemption. And while reg fees will be determined by the status of your authorization as of October 1, 2009, note that a special temporary authorization for DTV operation in effect as of that date will count as a “license” for fee calculation purposes this year.

We have prepared a table reflecting the proposed 2010 reg fees here. The numbers in parentheses reflect the amount of the proposed changes from last year’s fees – and as a visual aid, we have indicated proposed fee increases in red, and proposed reductions in cool blue.

The proposed fees are just that – proposals. We won’t know the final fees until sometime this summer, although historically the final fees tend not to stray too far from the initial proposals. We also do not yet know when the fees will be due, although that tends to be in September (or possibly August). Look for an announcement sometime mid- to late Summer.

One last highlight of the NPRM. The Commission is proposing to do away with the postcard notification system by which it has, for several years, alerted broadcast licensees of their primary fees. The postcards will still go out this summer, but starting in 2011, media licensees would be on their own to determine the fees they owe. (This is part of an effort by the FCC to become “more electronic and less paper-oriented”.) If you would like to comment on this particular proposal, the Commission is going to leave the comment/reply comment period open until September 30, 2010 for that limited purpose.

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A look at successes of the past gives the FCC a way to move forward.

(Author’s note: Last November I posted an item here improvidently titled “How to Solve the Network Neutrality Problem.” My solution was overturned, along with the FCC’s efforts at Internet regulation, by the recent court decision in Comcast v. FCC. Below is a revised path to the same goal that still works after Comcast.)

Network neutrality advocates are in despair following the Comcast decision. That case arose when cable company Comcast selectively hindered customers’ access to certain file-sharing services. The FCC told it to stop. Comcast already had stopped, but went to court anyway to protest the FCC’s butting in. The court ruled for Comcast, asserting the FCC lacks authority to regulate Internet service providers. Comcast is free to decide what content to favor, impede, or block entirely. Read our account here. 

Network neutrality – the principle that Internet providers should treat content even-handedly – seems to be dead, waiting only for someone to close its eyes and straighten its tie.   The more desperate among its advocates – including at least one FCC Commissioner – speak openly about the nuclear option: a step called “reclassification.”  This means the FCC would reclassify broadband Internet service as a common carrier “telecommunications service,” thereby exposing it to a wide panoply of regulation. As my colleague Paul Feldman notes, reclassification would generate opposition from several industry segments and possibly Congress, and would certainly lead to protracted court appeals. Also the legality of reclassification is in doubt. Many components of Internet service simply do not fit the definition of telecommunications service (see below), and so are not plausibly subject to regulation.

Reclassification is a sledge-hammer. We need a scalpel. Fortunately, one is available.

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Implementation schedule for FCC actions released

The FCC has released its tentative calendar year 2010 schedule for implementing those aspects of the National Broadband Plan (NBP) that fall under its jurisdiction. We had complained when the NBP first came out that the FCC could usefully have identified those goals that it could achieve on its own and those objectives that require legislation or action by other administrative agencies to accomplish.  Now the FCC has thoughtfully and in detail resolved our complaint. 

The “2010 Broadband Action Agenda” lists more than 60 different rulemakings or other agency actions which are or will soon be in the pipeline in furtherance of the Broadband Plan.   The items are helpfully color-coded and related by cool icons to the FCC office that is responsible for the item.   We especially appreciate the blank box that sits next to each item waiting expectantly to be “checked off” when the item is completed. (For a less glitzy but more colorful PDF version of the agenda, click here.)

While it is wonderful to see the FCC moving aggressively to issue orders and initiate proceedings in furtherance of its Plan, we need to remind ourselves that launching a Notice of Proposed Rulemaking (NPRM) is a far cry from actually reaching a final decision. Some of the rulemakings on the agenda, such as USF Reform and Intercarrier Compensation, have stumped the FCC for nearly a decade. There is no reason to be particularly hopeful that placing them on an agenda – even a color-coded one with actual calendar quarters on it – will cause them to be resolved quickly.  Indeed, the very breadth of the NBP and the major across-the-board restructuring of the telecommunications landscape it contemplates may require starting over from scratch on some industry issues that have proven remarkably intractable in the past.  

It’s especially disheartening to see that some of the most difficult issues will not even be teed up as NPRMs until the 4^th quarter of this year.   If it takes that long to get an NPRM out with a plan already in place to guide you, how much longer will it take to arrive at an actual final decision? Just checking the block on issuance of the NPRM may make people feel good, but nothing will have been accomplished.

Further, the Agenda comes with its own fine-print footnote that reads like a disclaimer for some new medicine. The footnote reminds us that the Agenda reflects “only proposed FCC actions, not those of other government agencies” – a major carve-out, given the significant elements of the NBP which are controlled completely by other government agencies. The footnote also cautions that the timelines described in the Agenda are merely “a series of targets that may be adjusted to respond to changing conditions as appropriate.” It goes on from there, but you get the picture.

So we wish the Commission Godspeed as it embarks on its implementation plan, and we earnestly hope that the effort does not get bogged down in the usual administrative inertia that so often sinks bold new initiatives in this town.

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FCC faces a range of options, none particularly attractive

As my colleague Mitchell Lazarus concisely analyzed here, the D.C. Circuit has vacated the FCC’s 2008 determination that Comcast’s network management practices violated the 2005 Internet Policy Statement. The Court held that the FCC’s attempt to enforce these particular “net neutrality” policies was invalid for lack of jurisdiction.

 Jurisdiction in this context means power or authority. An independent federal agency’s ability to take any action depends on the authority granted that agency by Congress. If Congress has authorized the agency to act, the agency may act; if Congress hasn’t authorized it, the agency may not act. Of course, things are seldom that cut and dried.  Sometimes Congress authorizes the agency to regulate in a general area but doesn’t mention anything about another, related, area.  (For example, prior to 1984 the Communications Act authorized the FCC to regulate broadcasting, but said nothing about regulating the cable TV industry.) The courts have agreed that, in such cases, the FCC may act in the not-specifically-mentioned area if such action is “reasonably ancillary” to the agency’s “statutorily mandated responsibilities”.

 In the Comcast case, the FCC claimed its regulation of Comcast’s practices was “reasonably ancillary” to a number of the Act’s provisions. But the D.C. Circuit concluded that none of the provisions cited by the FCC imposed any “statutorily mandated responsibility” to which the FCC’s regulation of Comcast might be deemed “reasonably ancillary”. And without that essential nexus, the FCC lacked the power, or jurisdiction, to do what it had done. As a result, the Court’s ruling also signaled that the FCC may lack the power to impose network neutrality principles.

 So where does the FCC go from here if it wants to promulgate net neutrality regulations? There appear to be four major options:

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FCC lacks authority from Congress to regulate provision of Internet services

Just three short weeks ago, the FCC took the Nation to the mountaintop and showed us the promised land of broadband – every man, woman, and child among us interconnected by high-speed Internet. Part of the dream foresees an Internet free of any provider’s control, giving everyone access to all of the content on the planet.

That last part – Commission-protected freedom from providers’ control – has now taken a serious hit from the U.S. Court of Appeals for the D.C. Circuit. The Court has concluded that the FCC lacks authority to require providers to treat Internet content even-handedly.

Comcast launched the case back in 2007, when it deliberately hindered its Internet customers’ access to certain file-sharing services (possibly, some critics thought, to protect its parent companies’ on-demand cable services from competition). Comcast stopped the practice after the story came out, and after its claims that it was “just controlling congestion” were shown to be untrue. The FCC subsequently imposed certain reporting and disclosure requirements on Comcast’s traffic management practices.  Comcast took the FCC to court, where we observed that the oral argument did not go well for the FCC.

The court has now ruled squarely for Comcast and against the FCC, holding that the powers granted to the FCC by Congress do not include the power to regulate Comcast’s provision of Internet service.

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FHH’s Paul Feldman will soon be on the road again, speaking on Network Neutrality at OTTcon East in Atlanta on June 17.  OTTcon East is a conference focusing on “over-the-top” (OTT) services which rely on the Internet to deliver video content to the home.  (Think Internet-accessing game consoles, DVRs, disk players and the like, all of which permit content providers and consumers to by-pass traditional video service providers like cable.) 

Paul’s address (title: “Network Neutrality – Friend or Foe?”) will focus on – what else? – Net Neutrality.  In addition to providing an overview of the Commission’s 2005 Internet Policy Statement and its 2008 Comcast/BitTorrent Order, he’ll also address the FCC’s latest Net Neutrality proposals and related questions, including:

• Would Net Neutrality rules help or hurt OTT video providers?
• What impact, if any, will the proposed Comcast/NBCU merger have on Net Neutrality?
• What impact, if any, will the FCC’s proposal to require Internet gateway set top boxes have on Net Neutrality?

The OTTcon event is dedicated to providing in-depth perspectives and critical analysis needed to address the challenges which OTT video pose for a range of traditional business models, such as those of pay TV operators, content owners, consumer equipment manufacturers, and over-the-air broadcasters.  For instance, among the featured speakers on June 16 will be:

• Rick Ducey, Chief Strategy Officer of BIA/Kelsey, providing his take on the role of local broadcast TV in the development of OTT (sample grab: “adding free to air, local digital station into [the OTT] mix is becoming more attractive.”); and
• Richard Yelen, Managing Director of Neulion, looking at the changing landscape of TV consumption and the pressure that is putting on cable, satellite and over-the-air providers to work OTT and IPTV into their distribution strategy.
• Kevin Walsh, VP of Marketing for Zeugma Systems, getting technical about the “curse” of buffering of OTT video streams, which causes playback freeze-up.

More information about OTTcon East, including online registration, is available here.

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FCC envisions broadband-based "Smart Grid" to facilitate energy conservation

Can’t make it out to Disneyland for the 2010 version of “Walt Disney’s Carousel of Progress”? No problem. Just take a quick gander at Chapter 12 of the National Broadband Plan (NBP). A Jetsons-like future is, apparently, just around the corner for all of us.

The NBP, of course, is touted as promoting a wide range of society-improving interpersonal communication uses – like telemedicine and long-distance education. But the elaborate broadband infrastructure necessary for those communications could also be harnessed with innovative technology to enhance energy efficiency and safe transportation. Hence, the “Smart Grid”.

In the NBP’s vision, a national broadband “Smart Grid” would connect to most energy-consuming devices. It would enable the reduction, or at least evening out, of their consumption, and inform consumers of the extent, and cost, of their energy use (thus, ideally, encouraging them to stop being energy hogs).

Smart homes and buildings are the starting point – buildings equipped with devices that provide their occupants with information about their energy consumption, allowing them to make real-time adjustments in consumption patterns. 

Traditionally, consumers have received information about energy consumption only after-the-fact, when they receive their monthly utility bills. The FCC envisions systems that could monitor and report on energy use on a real-time basis, with pricing information included, thereby enabling consumers to avoid or to reduce consumption during peak demand periods. Since a significant portion of energy production plant is needed only during peak hours, less plant would be needed if peaks were leveled out. For example, if the power grid were under strain at a particular time, and you happened to be cooling your home enough to wear a sweater, your TV might flash dollar signs before your eyes to warn you that it is time to let the place warm up a little if you don’t want a rude surprise when your electric bill comes. Or you might receive a warning from your smartphone, leading you to change your thermostat using – yes – your smartphone, even if that thermostat is in your home in Washington and you happen to be surfing in California.

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Users can easily search by frequency, service, many other options

Our friend Andrew Clegg, who knows as much about radio spectrum as anyone, has launched a website to help the rest of us catch up.

Enter a frequency and you find its allocations, services, band plans, channel plans, auction history . . . and a link right to the applicable FCC rules. Learn which frequencies are available for a particular service. Find the bands shared by two particular services. Get background information on usage. Search by ITU footnote. (Okay, that one’s obscure.) Obtain useful engineering data, including band designators and free space loss at various distances.

The website is still in development, but those who use this kind of information on a daily basis, as we do, will find it invaluable. It trumps by far the FCC’s “Spectrum Dashboard” we reported on the other day, both by frequency coverage and by extent of data provided.

Dr. Clegg asked us to stress that the site is still under development. He invites feedback at w4je@w4je.com.

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FCC Plan offers bold suggestions, few details

The FCC's National Broadband Plan (NBP) correctly recognizes that improved broadband to the end-user cannot be achieved without significant changes to certain critical “behind the scenes” elements of the nation’s broadband “ecosystem” – including the resale of facilities to competitors; the cost of “backhaul” (i.e., the radio or wired paths between and among the cell towers and the cellular switching office); availability of “data roaming” (i.e., the ability of a mobile wireless user to receive and transmit data traffic when outside of the data service coverage of its own carrier); and transition of the telephone network away from copper to fiber. While short on details, the NBP (in particular the section titled “Competition in Wholesale Broadband Markets”, in the “Broadband Competition and Innovation Policy” chapter of the NBP) suggests a return to regulatory schemes that, in addition to being troublesome and cumbersome, simply haven’t ever worked in the past.  

Nevertheless, no one can accuse this FCC of lacking boldness.

Resale. Historically, the FCC has attempted to use competition to regulate markets in two ways: (a) by establishing a regulatory environment conducive to competitors who own their own facilities (so-called “facilities-based competition”); or (b) by forcing facilities-based carriers to make their facilities available to non-facilities-based companies at rates that will allow the latter to earn a reasonable profit (a “resale market” approach).  

Facilities-based competition tends to promote a wider diversity of consumer choices, greater responsiveness (in time and substance) to consumer desires, and lower service rates – while avoiding the various downsides of direct regulation. Still, the Commission sees a role for the resale market approach in promoting broadband because, in the agency’s view, “well-functioning wholesale markets can help foster retail competition”, particularly in view of both (a) the economies of scale, scope and density of telecom networks, and (b) the economic and practical infeasibility of building out competitive facilities in all geographic areas.

This may ultimately prove, like third marriages, a triumph of hope over experience.

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OCAS system could reduce collisions, power costs, and avian mortality – what’s not to like?

What would you think about a tower safety device that reduces the number of aircraft collisions with towers, is environmentally friendly, and eliminates the need for towers to be continually lit? Too good to be true? Perhaps, but OCAS, Inc. (a company founded by two former military pilots) has petitioned the FCC for approval of just such a system.

Specifically, OCAS has asked the Commission to add a new Subpart T to Part 87 of its rules in order to allow its Obstacle Collision Avoidance System (OCAS ® – hence the company’s acronymic name) to be widely deployed. The technology at work here is similar to air-to-air collision avoidance systems in use for some time now. In fact, the OCAS system itself has been used in a number of locations worldwide, including at some U.S. government (shh!) installations. In light of its successful operations over a period of time – not to mention marketplace demand for an improved obstacle warning system – OCAS is asking the Commission to make the rule changes necessary for the system to be much more widely-used.

The OCAS system consists of three basic components: a low-powered continuous wave radar; an energy supply source to turn on and control the lighting on the structure; and a VHF radio which can transmit simultaneously on virtually all aviation-band frequencies.

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Procedural fine-tuning, ex parte NPRM comment deadlines set

Two months ago we reported on a couple of Notices of Proposed Rulemaking in which the FCC was looking to fine-tune aspects of its procedural rules and its ex parte rules. Those NPRMs have now appeared in the Federal Register – the procedural rules NPRM here, the ex parte NPRM here. Those publications in turn establish the deadlines for comments and reply comments on the Commission’s proposals. Comments in both proceedings are due by May 10, 2010, reply comments by June 8, 2010.

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Candidate sources include TV and satellite frequencies

Everybody reading this on a wireless device, raise your hand. We thought so! Our readers are unusually up to date. Those old-style Ethernet cables into the wall are so Twentieth Century.

The FCC has noticed all of us using our phones like little laptops and TVs, and our wireless laptops for everything else we do online. All of that data has to ride on radio waves. Other things being equal, more data will require more radio spectrum. As part of its ambitious National Broadband Plan, the FCC is looking to find some.

The FCC will have to look hard, because we are going to need a lot of spectrum. Recent increases in demand are impressive. AT&T, with its ubiquitous iPhones, shows an annual growth in service of 268%. The other major carriers are close behind. Analysts expect continued sharp growth over the next several years.

What is driving the demand? The FCC politely calls it “users engag[ing] with data-intensive social networking applications and user-generated video content.” Judging from the people at Starbucks, we think it’s mostly Facebook videos of college kids horsing around. But if people are willing to pay for it, the carriers will try to deliver, and the FCC will work on helping them find enough spectrum.

The goal is 500 MHz, newly available, of which 300 MHz should be between 225 MHz and 3.7 GHz. The FCC does not explain these boundaries, but we will. Lower frequencies need bigger antennas; 225 MHz is around the lower limit for a hand-held device. And frequencies that are too high do not propagate well; anything much above 3.7 GHz is not practical for mobile applications.

The most-discussed proposal – and most reviled, in some circles – would convert 120 MHz of TV broadcast spectrum, 20 channels’ worth, to wireless broadband applications. After all, the FCC may have reasoned, auctioning just 52 MHz of the former 700 MHz TV spectrum brought in $19.6 billion. So let’s do it again, but more so. Only 10% of households still depend on over-the-air TV, so where’s the problem – especially since the broadcasters can all stay in business, once we arrange for them to share whatever channels remain. And those who give up spectrum voluntarily will be in for a cut of the auction revenues. Everybody wins, right?

Such is the gist of the FCC’s thinking.

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New deadline for electronic filings only: March 26, 2010 at 10:00 p.m. EDT

Are you planning on filing an application for a Comprehensive Community Infrastructure (CCI) project in connection with the Second NOFA? NTIA has announced that the deadline for electronically-filed applications for CCI projects has been extended a generous five hours. The old deadline (which we reported here) of 5:00 p.m. on March 26 is now old news; the new deadline is 10:00 p.m. the same day. According to NTIA, “[t]he complexity of preparing an infrastructure application requires applicants to offer proposals that are truly comprehensive in scope”, and so “applicants may need the full business day on Friday, March 26, 2010, to finalize their proposals.” But the previous 5:00 p.m. EDT deadline would have meant that would-be applicants outside the Eastern time zone would be getting less than the full day. To be equitable, NTIA has now tacked on an additional five hours.

Note that this extension does not apply to any applications which are not electronically-filed. That means that if you’re planning on filing the old-fashioned way, on paper, your deadline is still 5:00 p.m. EDT on March 26 – and since electronic filing is the default requirement, any such horse-and-buggy filing will have to be accompanied by a waiver request.

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FCC encourages use of broadband by schools and funding of broadband by government.

Among the array of ills which the FCC’s National Broadband Plan (NBP) addresses is the insufficiency of broadband in our schools.  The NBP therefore devotes considerable attention to Education. It begins by noting studies showing American students lagging far behind their counterparts in other advanced nations in math and science. The NBP’s solution, unsurprisingly, is more broadband. The NBP promotes the use of broadband-enabled resources for students, teachers and educational intuitions and proposes increased investment in broadband infrastructure. Specifically, the NBP recommends a collection of initiatives designed to: (1) support and promote online learning; (2) unlock the value of data and improve transparency; and (3) modernize educational broadband infrastructure.

The NBP strongly embraces online learning tools as both an in-class resource and a means of extending learning beyond the classroom. To promote online learning, the NBP’s recommendations include creating and implementing new standards and formats so that educational content can be more easily located and shared by educators. The plan also urges Congress to consider certain changes to copyright law to “encourage copyright holders to grant educational digital rights of use.” 

On the state and local level, the NBP recommends changes to accreditation programs to allow for more online instruction to count towards primary, secondary and post-secondary programs – allowing students in rural high schools, for instance, to take online AP courses from larger schools or even schools from other states. State and local school systems are also encouraged to include more “digital literacy” elements in their curricula. Finally, the NBP recommends increased funding from the U.S. Department of Education (DOE) and other federal agencies for research and development of online learning systems and teacher training in digital literacy.

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The FCC's much ballyhooed National Broadband Plan (NBP) was finally announced on March 16 after weeks of titillating leaks from the Commissioners and staff about what was in the plan. By any measure, the NBP is an ambitious and far-reaching initiative which places the advent of broadband somewhere between the invention of fire and the Second Coming on the scale of human historical importance. With the postings immediately below, we start a series of blogs on various aspects of American life which the FCC expects will be improved by broadband access.  (Check back for additional such posts in the future.)   With Commissioner Tate's departure from the Commission, there is, sadly, no analysis of how broadband can fight obesity, but that is about the only facet of life that is not potentially touched by broadband.   We address the various thematic elements of the Plan with a view toward assessing where there may be risks and opportunities for the constituencies involved.    

To be sure, the NBP was an enormous undertaking, and the FCC is justly to be commended for completing  it in record time – to the extent it has not already repeatedly commended itself.   The NBP makes findings and bold recommendations in such areas as jobs, telemedicine, healthcare, energy, public policy, and other areas of commerce that will be affected by broadband – with telecommunications being a means to those ends.   While this was all part of the FCC's broad commission from Congress, we and the Commission are now left to sort out how these worthy goals are to be accomplished.  

The NBP is not a proposal per se. It is not even a blueprint.   It is more of a "things to do" list. Scores of actual notices of proposed rulemaking are in the works to implement certain aspects of the plan are that are within the Commission's jurisdiction.   But many important aspects of the plan require new legislation to change existing law, action by other independent states or federal agencies, or even new treaties with foreign countries.   The FCC can only advise as to those actions. In this respect, it would have been very useful for the Commission to explicitly identify those elements which it plans to implement on its own authority and those which require action by others. An undertaking of this magnitude requires a clear division of labor, with all parties having clear marching orders. If the NBP is to have as dramatic an impact as it could, there must be buy-in to the Plan by a broad range of regulators and legislators.   Unfortunately, the Plan is a stirring call to action on pages 1-7, but by page 338, the reader is less likely to be aroused than to be asleep.

None of this is to disparage the Plan. It is full of useful insights and information, and we recommend it to everyone. We also recommend that interested readers review the topical treatments posted below.

[Blogmeister note: This is one in a series of posts describing the range of regulatory and societal areas in which the National Broadband Plan could, and likely will, affect us all. Click here to find other posts in this series.]

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Need a comprehensive approach to broadband-based health care? Take two aspirin and call the FCC, or Congress, or the FDA, or HHS, or the States, or . . .

In the health care chapter of its National Broadband Plan (“NBP”), the FCC envisions nationwide availability and use of electronically gathered, exchanged, and archived medical information to improve individual and public health care. Getting there from here (noting that the United States is at the back of the pack within the developed world when it comes to electronic health care) will require a vast, coordinated effort on the part of many different players. Looking at the big picture, the NBP identifies three major gaps:  adoption, information utilization, and connectivity. It goes on to formulate a comprehensive plan to fix all three before apparently realizing that the FCC only has jurisdiction over one – connectivity.  Undeterred, the NBP creates a “honey do” list for Congress, the States, the Secretary of Health and Human Services, the Centers for Medicare & Medicaid Services, the Food and Drug Administration, and the Office of the National Coordinator for Health Information Technology.

Having put the rest of the government on the right track, the FCC also sets itself a few tasks:

• Establish Health Care Broadband Access and Infrastructure Funds within the Rural Health Care Program. The FCC proposes to establish two health care broadband funds, a “Health Care Broadband Access Fund” and a “Health Care Broadband Infrastructure Fund.” The Health Care Broadband Access Fund would replace the existing Internet Access Fund, supporting bundles of services for eligible health care providers. It would be available to both rural and urban health care providers, based on need.  The Health Care Broadband Infrastructure Fund would subsidize network deployment to health care facilities where existing networks are insufficient. 
• Allow broader participation in the Rural Health Care Program. The FCC plans to authorize participation in both funds by long-term care facilities, off-site administrative offices, data centers and other similar locations. To further expand the reach of the programs, the FCC recommends that Congress make funding accessible to private for-profit institutions that serve particularly vulnerable populations. The FCC also proposes to increase participation by increasing the amount of support and simplifying the application process.
• Establish outcome-based performance measures.  To protect against fraud, waste, and abuse, the FCC proposes that participating institutions will have to meet outcome-based performance measures to qualify for the above funding, on the model of Health and Human Services’ “meaningful use” criteria.  
• Publish a biennial Health Care Broadband Status Report. This report will discuss the state of health care broadband connectivity, review industry trends, describe government programs and make reform recommendations. The FCC will analyze the progress of its own programs and, we hypothesize, give Congress, the States, and other federal agencies letter grades for performance and effort.
• Collaborate with the Food and Drug Administration on regulation for medical devices. The FCC seeks to address and clarify the regulatory approach in areas where communications and medicine converge, such as medical devices that use radio frequencies. Such devices might include wearable sensors for monitoring a patient or smartphone applications that give fetal heartbeat and contraction information to an obstetrician. The FCC proposes, within the 120 days following release of the NBP, to seek formal public input and conduct – wait for it – workshops.

In a similar vein, on Friday, March 19, 2010, the Rural Utilities Service of the Department of Agriculture released a Notice of Funds Availability and Grant Application Deadlines for its annual Distance Learning and Telemedicine grant program application window.  This program primarily funds end-user equipment used for distance learning and telemedicine, such as video conferencing or teleradiology equipment. Therefore, in NBP terms, it addresses the adoption gap.  (The deadline for applications for funding from this NOFA is May 18, 2010.)

[Blogmeister note: This is one in a series of posts describing the range of regulatory and societal areas in which the National Broadband Plan could, and likely will, affect us all. Click here to find other posts in this series.]

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FCC vision stops short of specific reallocation of D Block for public safety broadband use

The National Broadband Plan (NBP) suggests some bold steps to develop a nationwide public safety broadband network. These include new federal grant programs, roaming and priority access on commercial broadband networks to add capacity, a common technology standard, a new federal office within the FCC to address interoperability issues, and incentives for public-private partnerships. However, to the great disappointment of those who have asked Congress to reallocate the 700 MHz D Block for public safety broadband use, the NBP suggests that the D Block auction proceed as required under current law.

The NBP does not recommend any fundamental changes to the current 10 MHz of spectrum in the 700 MHz band already allocated for public safety broadband. However, national public safety organizations and others have argued that additional spectrum (the adjacent D Block currently slated for auction) will also be needed to accommodate future public safety requirements, especially once first responders have the capability to stream live video to and from the field. The NBP suggests instead that public safety have priority access to commercial spectrum when dedicated public safety spectrum is unavailable, for example during a major emergency.

To make priority access and roaming work, the NBP recommends that the Commission mandate use of LTE as the broadband standard for both the D block and the adjacent public safety spectrum (LTE has already been selected by other 700 MHz commercial licensees such as Verizon and AT&T). This will allow devices to roam across the band and, pursuant to rules yet to be proposed, provide the mechanisms for priority access to be implemented. The big question for public safety, however, is whether commercial licensees would be willing to provide first responder agencies with seamless priority access to their networks, potentially disrupting (or at least slowing) their commercial customers’ communications. The NBP does propose that commercial providers be allowed to charge public safety for priority access, and some FCC staff have suggested that charges be limited to something like a “most favored customer” rate.

The federal grant programs are intended in part to provide funding for the deployment of the dedicated public safety spectrum, based on assumptions that existing public safety land mobile radio transmitter sites and, through partnership agreements, existing commercial cellular sites are used for the build-out.   Federal grants could also be used by public safety entities to “harden” shared commercial sites to meet public safety requirements (e.g., to add back-up power and reinforced towers). Part of the money for these grants could come from new commercial broadband fees proposed in the NBP, similar to the Universal Service Fund.

Tying all of this together will be the Emergency Response Interoperability Center (dubbed “ERIC”) that will reside with the FCC’s Public Safety & Homeland Security Bureau, but will also have input from DHS and other federal agencies. There will be some type of advisory body to ERIC consisting of public safety representatives, though its composition and exact role are yet to be defined. Similarly, the NBP does not address how ERIC will interface with the Public Safety Spectrum Trust, which holds the national license for dedicated public safety broadband spectrum.

Finally, the NBP contemplates that the FCC will soon address long-standing petitions for waivers from various state and local governments seeking authority for “early” deployments of 700 MHz public safety broadband systems. On March 17, the FCC issued a Public Notice seeking comment on a set of recommendations as to how to maintain interoperability among those systems and the yet-to-be deployed national broadband network.

As with other parts of the NBP, the public safety issues have already generated debate and will inevitably lead to contentious rulemaking proceedings and perhaps legislation in the months to come.

[Blogmeister note: This is one in a series of posts describing the range of regulatory and societal areas in which the National Broadband Plan could, and likely will, affect us all. Click here to find other posts in this series.]

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NBP identifies on-line privacy as important – but questions abound as to what steps to take and who to take them

The FCC’s National Broadband Plan calls for the extension of broadband into virtually every facet of American life.  While ubiquitous connectivity has many benefits, it also raises questions about how to maintain the privacy of those who enter this brave new world.   The FCC astutely recognized that people’s concerns in this regard could be a significant barrier to adoption and utilization of on-line systems, and it has therefore offered some recommendations on how to create an on-line environment which will provide more consumer protections. But lest you think the FCC has suddenly gone soft and consumer-oriented, the National Broadband Plan (NBP) recommendations for on-line privacy place a hefty emphasis on the need to encourage commercial services which harness “digital identities” to provide customized services (and make a lot of money). These seemingly contradictory goals actually serve the same common purpose, according to the plan: firms with greater access to greater amounts of personal information can offer better targeted services, which in turn increase consumer use and utility.

So how do we reconcile these apparent cross-purposes to reach the FCC’s goal? Generally, the theme seems to hinge on two notions: (1) ensure competition and innovation in the data-collection and data-mining industry, and (2) ensure that individuals can manage their own “digital identities”.

Noting that the “existing regulatory frameworks provide only a partial solution to consumer concern and consist of a patchwork of potentially confusing regulations”, the NBP suggests, but does not outright recommend, that someone (Congress? It is unclear.) should sort out and clarify the roles of the FTC and FCC with respect to on-line privacy.  In a side-bar, the FCC tiptoes around asking Congress to help, but suggests that maybe the legislative branch ought to look into revision of the Privacy Act to, at the very least, grant consumers more control over their personal data.

Whichever branch of government or executive agency actually acts, the FCC makes recommendation is in the following areas:

Federal Framework – First, the FCC calls for laws or regulations that more specifically address the obligations data-collection and data-mining firms have to consumers with respect to use, sharing, collection, and storage of personal data. 

Second, the FCC thinks Congress should help develop trusted “identity providers” to assist consumers in managing their data. Apparently the FCC believes that Congress is the best vehicle for adopting a regime in which safe harbor provisions, guidelines and audits could permit companies to become “trusted” safe-guarders of personal information. The FCC feels that Congress should also ensure that such companies can get insurance for their trouble.

Finally, the FCC recommends that it work with the FTC to develop principles to require consent before broadband service providers share certain personal data with third parties. Why this concept falls under the rubric of “principles” rather than “rules” is not explained, nor are potential enforceability issues.

Identity Theft and Fraud – Given that the FTC is mandated by Congress to act as the identity theft complaint clearinghouse and consumer guidance counselor, the FCC is all too happy to let the FTC continue to bear that burden.  The NBP does recommend some changes: first, the FTC should be given additional resources to battle identity theft and fraud.  These efforts should include amping-up OnGuard Online (an FTC-administered website that provides practical tips to consumers on internet privacy), maintenance of a database sorting out which agency is responsible for what when it comes to consumer protection on-line (back to that hot potato problem), and greater education and outreach.  Finally, the FCC recommends that the FTC coordinate more closely with the national security apparatus.

Child Protection – Citing the lesson that the best way to make swimming pools less dangerous for children is to teach children how to swim, the FCC recommends that the federal government (presumably the White House) create an interagency working group to coordinate child on-line safety and literacy efforts, and to spearhead a national education campaign.

 [Blogmeister note: This is one in a series of posts describing the range of regulatory and societal areas in which the National Broadband Plan could, and likely will, affect us all. Click here to find other posts in this series.]

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NBP envisions overhaul of compensation/distribution schemes to fund $24 billion to close broadband “gap”

One of the problems which has vexed the FCC for more than a decade is how to adapt the Universal Service Fund (USF) and Inter-Carrier Compensation (ICC) regime to the world of the internet.  The USF and ICC were 20^th Century constructs which patched up subsidy and traffic exchange problems arising from the AT&T break-up.  The need for reform in these areas has been stymied by the inability of policy-makers to resolve the competing, but more or less legitimate, demands of all the players.  The advent of broadband offers the FCC an opportunity to break the logjam in the context of a migration to all-digital, all-IP networks.

In this cause, The FCC’s ambitious National Broadband Plan (NBP) to facilitate universal access to broadband is inspiring, but as Rod Tidwell and Jerry McGuire (portrayed by Cuba Gooding, Jr. and Tom Cruise, respectively) famously insisted: “Show me the money!” The NBP asserts that it will cost $24 billion to close the “broadband availability gap” and provide the targeted level of affordable broadband service to currently unserved areas.

Where will this money come from?

The FCC proposes to transform and re-purpose the major source of funding currently used to facilitate the provision of telephony in unserved areas, i.e., the USF, into a new Connect America Fund (CAF) to facilitate provision of broadband services. And because, for historical reasons, the USF programs are deeply connected to the way that telecommunications carriers make payments to each other for carrying telephone traffic, the NBP also proposes revisions to the ICC system. With broad proposals to “comprehensively reform” the complex mechanisms through which billions of dollars per year are collected and disbursed, revisions to USF/ICC will be a hotly contested process that will raise some difficult questions.

Currently, three out of the four federal USF programs are not designed to support broadband services directly, though some carriers that receive USF use that funding to construct facilities that can be used for broadband as well as tradition voice services.  In addition, the largest of the USF programs, the High Cost Fund (HCF), supports only certain components of a network, such as wires and switching equipment, but not other components necessary for broadband. Thus, rather than “tweaking” the existing USF programs, the NBP proposes that the FCC pull $15 billion out of the HCF over the next decade and re-purpose that money into the CAF to facilitate (wireline) broadband development. 

In addition, the FCC would create a Mobility Fund to facilitate the development of broadband mobile wireless networks where the market would not otherwise support such development.  Lastly, between 2012 and 2020, the FCC would beginning phasing down and ultimately eliminating the HCF – first by eliminating payments to competing providers in certain areas (primarily cellular companies) and then by phasing out payments incumbent telcos for traditional voice services. After 2020, the only voice services eligible for federal support would be broadband voice services.    

As noted above, the NBP also proposes broad reform of the ICC system. This is because prior to the deconstruction of the Bell System in 1984, universal service was largely funded by a complex set of internal AT&T price and cost cross-subsidies, shifting costs from rural to urban users, from residential to business users, and from local to long distance users. After the break-up of the Bell System, those cross subsidies were replaced with direct payments between phone companies, with rural and smaller phone companies charging ICC rates designed to reduce the cost of providing service to their residential customers.  

When the Telecommunications Act of 1996 was enacted, it mandated that federal subsidies for universal service be funded explicitly, through USF. Nevertheless, the business structures of many telephone companies still rely heavily on the profits received from ICC, and to the extent their ICC declines, those companies would either have to receive more USF, or raise fees on customers. Thus, ICC still plays an important role in making service affordable for customers, a key universal service policy goal. Nevertheless, the NBP recognizes that due to changes in technology (reduced costs of switching and transport of digital data) and increased competition, the existing ICC regulatory structure does not function well and leads to destructive market and behavioral distortions. Indeed, notwithstanding the huge growth of VoIP, many parties claim that the current ICC regulatory regime does not provide for payment of ICC for carriage of VoIP traffic, leading to extensive litigation and under-recovery of ICC by incumbent carriers.

Accordingly, the NBP proposes a staged transition of ICC between 2012 and 2020.

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Graphic database allows searches by frequency, location, name, or licensee category.

The FCC has released its “Spectrum Dashboard,” a graphic-interface database of frequencies and licensees from 225 MHz to 3700 MHz. (Check out the graphic to the left, which is a partial screen grab of the "Browse Spectrum Bands" function of the Dashboard at work.) You can search by spectrum band, geographic area, licensee name, or FCC licensee category.

Although very much a beta release, and limited in scope of spectrum, it is fun to play with. If you like that sort of thing. And we know some of you do.

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Coalition seeks to share federal frequencies for mobile broadband backhaul

The Fixed Wireless Communications Coalition (FWCC), on the same day that the FCC released its new National Broadband Plan, offers to solve one of the problems identified in the Plan.

We all know about the growth in mobile broadband, driven largely by people watching Internet TV and videos on their phones and laptops. The FCC’s efforts to find more spectrum for these applications – efforts that might involve even auctioning off TV channels – are getting a lot of attention. Less conspicuous is the parallel problem of “backhaul”: moving data back and forth between the network and the cell towers that communicate with all those mobile devices. Today most cell towers connect with copper wire that Alexander Graham Bell would recognize. It works fine for voice calls, but lacks sufficient capacity for broadband. At some locations optic fibers are an option. Other cell towers, though, especially at remote locations or in rugged terrain, are best reached by microwave radio links. And that requires . . . Raise your hands, class . . . anyone? Yes! More spectrum!

Fortunately backhaul signals ride best on higher frequencies than mobile broadband, so the two need not compete. The 4-10 GHz range is the backhaul sweet spot. Below that the antennas are too big; above, radio waves are impeded by rain.

The “fixed service” – an FCC category that includes backhaul – has allocations at 4 and 6 GHz. But their use is severely limited by satellite operations in the same bands, except for a satellite-free slice at 6 GHz. The only other “fixed” allocation below 10 GHz is a huge Government-only swath at 7125-8500 MHz.

With nowhere else to go, the FWCC has now asked the FCC to let non-Government users, including backhaul providers, share the 7125-8500 MHz band with the Government. Also involved in the decision will be the National Telecommunications and Information Administration (NTIA), a part of the Department of Commerce that manages spectrum for all U.S. Government agencies.

There is precedent for the idea. The fixed service band at 21.2-23.6 GHz has been shared between Government and private users for many years, with great success. The one problem, from the private users’ standpoint, is the delay in licensing on most frequencies due to the need for coordination with NTIA. To avert that delay in the 7125-8500 MHz band, the FWCC proposes a database of both Government and private usage so that private frequency coordinators can determine quickly whether a given link can be safely constructed.

It remains to be seen whether NTIA will go along. We all share so much with the Government, it seems only fair to ask the Government to share a little back. Except, of course, for the frequencies that control the Black Helicopters. They can keep those.

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New BIP deadline: March 29; New BTOP deadline for CCI projects: March 26

NTIA and RUS have announced extensions of the deadlines for some, but not all, submissions in response to the Second Notice of Funds Availability (NOFA) issued as part of the Big Money Hand-out made possible by the American Recovery and Reinvestment Act of 2009.  Applications for Broadband Initiatives Program (BIP) funding will now be due at RUS by 5:00 p.m. (ET) on March 29, 2010. Applications for Comprehensive Community Infrastructure (CCI) projects under the Broadband Technology Opportunities Program (BTOP) will now be due at NTIA by 5:00 p.m. (EDT) on March 26, 2010. 

It’s not clear why one agency opted for March 26 while the other opted for March 29, but would-be applicants should be sure to note that the deadlines for NTIA and RUS applications responsive to the Second NOFA are no longer identical.

Also, the extensions do NOT apply to requests for NTIA/BTOP funds for Public Computer Center projects or Sustainable Broadband Adoption projects. The deadline for applications for such projects remains 5:00 p.m. (EDT) on March 15.  Check out our blog post about the Second NOFA for further details about the different types of projects.

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Chairman confirms upcoming effort to re-purpose TV spectrum for mobile broadband

For several months now the question on many TV broadcasters’ minds has been: will they or won’t they take away my spectrum and turn it over to smartphones? And while various FCC higher-ups have dropped conflicting hints about what the answer might be, the fact is that no one has expected to know for sure until the release (currently set for March 16) of the FCC’s National Broadband Plan (NBP).   But late this month Chairman Genachowski tipped the Commission’s hand, albeit without adding much practical detail. 

The FCC’s answer appears to be: TV spectrum is not being used efficiently, and would be better allocated to mobile broadband use, so the FCC plans to devise some mechanism to encourage TV licensees to cough up some or all of their spectrum in return for the prospect of taking home some portion of the proceeds when their spectrum is auctioned off for broadband.

According to the Chairman, the NBP will call for the “freeing up” of 500 MHz of spectrum over the next decade.  And one way the FCC hopes to achieve that, at least in part, will involve “establish[ing] market-based mechanisms that enable spectrum intended for the commercial marketplace to flow to the uses the market values most.” 

Can you spell “a-u-c-t-i-o-n”?

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Proposals are intended to make FCC proceedings more efficient and transparent, and less prone to abuse.

Those of us charged with getting the FCC to do things – issue licenses, grant waivers, cancel fines, all of that – are vitally interested in the fine points of FCC procedures, because understanding them can spell the difference between success and failure.  Just as no one would sensibly sit down to a game of poker without knowing that three of a kind beats two pair, no competent practitioner would take on the FCC without knowing the somewhat more complex rules of that agency’s regulatory game. And, sometimes, part of the job lies in knowing how to navigate those rules most advantageously.

So we take notice when the FCC proposes to change its procedures, as it did in two recent Notices of Proposed Rulemaking (NPRMs).  By and large the amendments are meant to serve laudable goals:  to make FCC proceedings more efficient and transparent, and to forestall some of the more common forms of abuse.

One NPRM proposes internal housekeeping changes which would:

• allow the staff (in place of the full Commission) to dispose of frivolous or repetitive requests for reconsideration;
• allow the FCC to amend  an action (as well as to set it aside) within the first 30 days;
• expand the use of electronic filing and notification;
• close some of the 3,000+ dockets that have become inactive;
• split overly large dockets; and
• clarify the effective date of new rules.

In a separate NPRM, the FCC takes on the always-controversial subject of its ex parte rules.

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Billions in broadband stimulus cash up for grabs – Deadline for applications: March 15, 2010

In the American Recovery and Reinvestment Act of 2009, known to some as the Gravy Train Act, but more generally known as the Stimulus Act, Congress allocated $2.5 billion to the Rural Utilities Service (RUS) and $4.7 billion to the National Telecommunications and Information Administration (NTIA). The money was to be doled out, in the form of grants or loans, to worthy projects designed to bring new or improved broadband service to America. As we reported last year, NTIA and RUS originally planned to make these awards in three tranches beginning in June, 2009 and ending before the September 30, 2010 award deadline imposed by the Stimulus Act.

Unfortunately, it’s harder to give out millions of dollars than you might expect. So far these agencies have managed to open only one application tranche, and have issued only a handful of grants.   Of course, they did get far more applications (2,200) than they had expected, which slowed things down. And the applications themselves required vast amounts of supporting data that was onerous in the extreme (the word “overkill” comes to mind) that had to be generated by the applicants and digested by the agencies. That slowed things down, too.

With the September 30 deadline fast approaching, each of these agencies has issued a second “Notice of Funds Availability” (NOFA) to distribute the remaining Stimulus Act funds for broadband projects.  Given the time constraints and the amounts of money already applied for, the third application window has been eliminated – meaning that this is the last opportunity to make a grab for any of this stimulus cash.    The deadline for filing applications for these funds is March 15, 2010. While applications can be submitted as early as February 16, there is no advantage in filing early other than beating the last minute rush.

Even if you are familiar with the NOFAs issued last year for the first tranche of funding, you still need to study these new NOFAs closely, because substantial changes have been made to the funding programs. Happily, many of these changes simplify what was universally understood to be an unnecessarily complex application process developed for tranche 1. Other changes relate to the prioritization of the awards.

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* (With a two-year contract. Fees may apply.)

You know those pesky penalties the cell phone companies impose when you cancel your service before the contract period has expired?  How they keep you from switching providers even when the service turns lousy or the competition offers a better deal? Or a better phone? To folks in the biz, those are referred to as Early Termination Fees (ETFs), and they’re back under the FCC’s microscope.

Cell phone companies offer deep discounts on the phone du jour, but only if the customer signs up for a one- or two-year contract, during which the company recoups the subsidy (and more) from monthly charges. Locking the customer into the contract is an ETF that can range up to $350. Worse, the ETF often remains at the full amount up to the last day of the contract period. Customers have complained their company charges the fee even when they move to an area the company doesn’t serve.

Back in December, we reported that the FCC had put Verizon’s ETF in its crosshairs after public outcry moved Congress to act, or to at least to threaten action. The FCC asked about Verizon’s customer notification policy on ETFs: what do the customers know and when do they know it?

Recently, the FCC widened its scope to include AT&T, Google, T-Mobile, Sprint, and another letter to Verizon. The first, Verizon-only, round of questions focused on how the consumer learns about the ETFs. Now the FCC is interested in how the ETFs are calculated, how they are applied to various phones and service plans, whether (and how) ETFs are prorated, and whether it possible for consumers to avoid ETFs altogether.

The companies’ responses are due by February 23, 2010.

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FCC formalizes coordination procedures between the birds, the B’s and the C’s

The FCC has issued a Report and Order adopting new rules formalizing frequency coordination requirements between Earth Stations in the Geo- and Non-Geostationary Orbit Satellite Services (GSO/NGSO) and Broadcast Auxiliary and Cable Television Relay Service (BAS/CARS) Stations in the 7, 10 and 13 GHz frequency bands.

Satellite operators use these bands to talk to their “birds” (satellites) through uplink and downlink earth stations. The same bands are used by BAS/CARS stations for fixed and mobile microwave feeds to TV stations and cable systems (such as studio-transmitter links and relays for news and other remote programming). The FCC normally requires interference mitigation through a coordination process prior to filing for a new license. That process involves sending notices to anyone in the FCC’s license database who might be affected, waiting 30 days for responses, and resolving any objections. The process is complicated enough that most applicants farm it out to  an engineering firm (such as Comsearch, Inc.),

Formal procedures have been in effect for some time for coordination between GSO/NGSO applicants and existing GSO/NGSO operations. Ditto for coordination between BAS/CARS applicants and existing BAS/CARS operations. But the Commission has not previously formally adopted any procedure for coordination between the two types of services. The FCC has now decided that the same “notice and response” rules and procedures will be in effect for coordination between as well as within the various services, when BAS/CARS stations are at fixed locations.

While the notice and response system works fine for fixed stations, it is not so simple for stations which move around, because you can’t coordinate if you don’t know where your station will be located at any given time. Therefore, the FCC has permitted mobile or temporary fixed BAS/CARS applicants to coordinate on an ad hoc informal basis, often through a third party like the local chapter of Society of Broadcast Engineers (SBE), which keeps track of who is doing what around town and when they plan to do it. The FCC has decided that all GSO/NGSO earth station applicants must use the notice and response system to coordinate with all BAS/CARS licensees, but temporary fixed and mobile BAS/CARS applicants may choose between notice and response and ad hoc coordination with GSO/NGSO entities.

When responding to a coordination request, temporary fixed and mobile BAS/CARS licensees are expected to seek protection only for frequently used locations and not for the entirety of a wide geographic area. The receive location for a temporary fixed or mobile system may be protected, as may frequently used program origination venues such as arenas, stadiums, and convention centers.

The FCC also looked at coordination in the 10 GHz band, used by terrestrial fixed microwave services and NGSO satellite links.  A while back, terrestrial operators proposed a “Growth Zone” policy, under which they could ask satellite operators to protect not only an existing path but also an anticipated future growth path. The FCC neither accepted nor rejected the idea but declined to adopt it at this time on the ground that the satellite parties who originally supported it are no longer pursuing 10 GHz licenses.   If the issue is raised again in the future, the FCC will take a new look at it.

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FCC adopts new Cuba policy, finally!

Our last report on Cuba ended with a cliffhanger: the Department of the Treasury's Office of Foreign Assets Control (OFAC) and Commerce's Bureau of Industry and Security (BIS) had eased their Cuba regulations with respect to telecommunications, but the FCC was clinging to its 16-year old, highly-restrictive policy. It turns out that the FCC was waiting on word from the State Department—and once that word rolled in, the Commission moved quickly. 

On January 12, 2010, FCC Chairman Genachowski received a letter from the State Department rescinding its 1993 policy letter and setting out new policy guidelines.  Sure enough, a scant nine days later, the Commission issued a Public Notice modifying its process for applications for service to Cuba. While the most burdensome restrictions from the old regime have been removed, applicants looking to serve Cuba should be aware of the following:

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With “Reboot.FCC.Gov”, FCC solicits public input to improve public interaction with agency

Depending on who you ask, 2010 may or may not be the start of a new decade. Depending on who answers, 2010 may or may not be the start of a new FCC. That’s because the FCC is relying on you (and you and you, the guy in the brown shoes reading this during his lunch break) to help decide on the direction in which the agency should be moving. They’ve labeled this process “Reboot.FCC.Gov” and, like all the kids are doing nowadays, they’ have not only set up a website at that domain, but also tied the whole thing together with the Blogging, and the Twittering and the Facebooking and the YouTubing (there’s a bunch of other social media connections as well, including, for some reason MySpace, in case the next big indie band wants to participate).

A more conventional format was used to launch the rebooting process on January 13: a press release (the website does contain a one minute “welcome” video from FCC Chairman Julius Genachowski).  As that release explains, the Commission is “soliciting public input on ways to improve citizen interaction with the FCC.” The Chairman elaborates on this, explaining that the goal is to “get input from all corners of the country on ways to improve usability, accessibility, and transparency across the agency.”

The project’s efforts focus on five key elements:

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It’s that time of year again – no, not tax time (well, not quite), but rather time to file annual Customer Proprietary Network Information (CPNI) certifications with the Commission. And just to make sure that the deadline is clearly highlighted on everybody’s “to do” list, the FCC has released an “Enforcement Advisory” reminding telecommunications carriers and interconnected VoIP providers that their CPNI certifications are due by March 1, 2010 (although they can be filed any time after January 1, 2010). 

CPNI is information relating to the quantity, type, destination, location, amount of use and configuration of service provided to telecom users. While it’s the kind of data that is collected routinely by carriers in the ordinary course of their business, it is nevertheless very private information – as the FCC has recognized in Subpart U of Part 64 of its rules. That subpart requires carriers and interconnected VoIP providers to establish and maintain systems designed to ensure that subscribers’ CPNI is adequately protected. 

And since the FCC is not in a position to inspect each and every company in order to confirm compliance with the rules, the Commission has dumped that particular monkey onto the backs of the companies themselves.  Each year telecommunications carriers must certify that they have established appropriate procedures and processes to protect CPNI. The certificate must include a description of how the procedures ensure that the responding company is or is not in compliance with the CPNI rules and must include a summary of all consumer complaints about unauthorized release of CPNI. It should also explain any actions taken against data brokers. And a detail which is often overlooked: the certification must be signed by a company officer who must affirmatively state that he/she has personal knowledge that the CPNI safeguards which have been established are adequate to ensure compliance.

Who has to file?

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Enforcement Bureau throws the (phone) book at convenience store

On January 14, just beating the expiration of the statute of limitations to punish offenders, the FCC’s Enforcement Bureau issued a spate of fines and citations against companies which had failed to file Hearing Aid Compatibility (HAC) Reports.   While the Bureau’s actions to some extent targeted the usual suspects (equipment vendors and carriers), they also, perhaps unwittingly, threatened a vast new class of businesses with regulation and enforcement actions. And by doing that, the Bureau also may have started a domino effect likely to lead to the elimination of the near-ubiquitous availability of prepaid phones and phone cards.

Despite the dire (and probably unforeseen, at least by the Bureau) consequences of its action, this whole affair started from good intentions. The Commission is rightly sensitive to the needs of the hearing-impaired. Because of that, the FCC’s rules contemplate that telephone equipment manufacturers will produce, and telecommunications service providers will make available to the public, a significant stock of cellphone handsets that are compatible with hearing aid devices. No problem there. And to keep everybody honest (in a “trust but verify” mode), the Commission requires all phone manufacturers and service providers to submit HAC reports on January 15 of each year, detailing their compliance with the handset stocking rules. Since these rules came into effect a few years ago, the FCC has taken an extremely harsh and unforgiving attitude toward carriers who fail in the slightest measure to meet the requirements of the rules.  

That harsh approach was evident in the fact that, among the Bureau’s targets was Firefly Mobile Communications. Firefly is a conventional telecommunications service provider, to be sure, but it was actually exempt from complying with the substantive handset stocking rules because it sold so few of them. Even so, Firefly was not exempt from the requirement to file an HAC report, so the Bureau slapped it with a citation and threatened to impose a fine if it fails to file the report again. (A “citation” is the FCC equivalent of a cop issuing you a warning rather than a speeding ticket; for some categories of offenders, the FCC is required to first issue such a warning before it can impose an actual fine.)

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Agency addresses spread of digital voice technology 

The telephone system formerly relied on the technology called “circuit switching”: by dialing a number, a caller caused the equipment to set up a temporary, private connection with the person being called. This is inherently an analog technology. Now, however, calls are increasingly carried in data packets moving over heavily shared facilities, either the on public Internet or on private networks that operate in much the same way. But the FCC rules are still geared to the old analog circuit-switched system. They are not well suited to handling IP-related innovations like VoIP and Google Voice. Recently we harrumphed that these advances would soon trigger the need for a regulatory overhaul.

Either our harrumphings carried across the Potomac, or else (and more likely) the people at the FCC saw the same facts we did and reached similar conclusions. The FCC has now released a short public notice with the momentous title, “Comment Sought on Transition from Circuit-Switched Network to All-IP Network.” It solicits input on the contents of a possible future Notice of Inquiry. Responses to the NOI in turn would inform a Notice of Proposed Rulemaking. And comments in response to the NPRM would help the FCC to formulate new rules. With three comment cycles planned, and allowing a year or two for each, the rules will take a while. (If you’re inclined to stake out your position early in the process, the deadline for responding to the initial comment invitation is December 21, 2009.)

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Treasury and Commerce Departments relax Cuba rules for telecommunications providers, but FCC not yet on board

Mojitos, plantains and panatelas, here we come! Cuba has been re-opened for telecommunications transactions with U.S. companies . . . at least as far as two important agencies are concerned.

Back in April, President Obama directed the federal agencies that administer the longstanding U.S. embargo against Cuba to “reach out to the Cuban people” by liberalizing the rules governing telecommunications to and from Cuba. And while his directive seemed to suggest that things should change immediatamente, it took until July to get things largely teed up, and even then an unexplained last minute delay added two more months to the process. But in September, two of the federal agencies that have historically administered the U.S. embargo against Cuba – Treasury’s Office of Foreign Assets Control (OFAC) and Commerce’s Bureau of Industry and Security (BIS)—relaxed their regulations. As a result, U.S. companies may now: enter into transactions for telecommunications service to and from Cuba; build telecommunications facilities to Cuba; and export telecommunications-related goods to Cuba – all without the need to obtain specific approval in advance. And get this – the new rules authorize travel to Cuba that is incidental to these approved activities. Vamonos, amigos!!

Heads up, though. One communications-related agency has taken a more, er, languid approach to El Presidente’s directive.

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One of the things that gripes an awful lot of people is the so-called early termination fee, or ETF, which you have to pay if you try to cancel your cellphone contract before two years are up. It is usually about $200, so if you are a Verizon customer drooling to get an iPhone, you are out of luck and can’t move over to AT&T unless you are willing to pay the piper’s penalty.

There is another side of the story, of course. Cellphone companies offer handsets at subsidized prices – below what they really cost – to woo customers. If you accept the subsidy, you should at least keep buying the service for a while, so that the carrier can recoup its investment in your whiz-bang phone toy. If you prefer not to subject yourself to an ETF, you can usually do so, but then getting the phone you want will cost you more. Because the cellphone companies make the deep discount on the phones so attractive, most people go for the ETF, which is, of course, exactly what the phone companies hope to accomplish: they get their hooks into you as a customer.

So many people got stressed out about ETFs, though, that Congress finally threatened to pass a law about them. Exactly how that would have shaken out we can’t say, because the cellphone companies made a pre-emptive strike by pro-rating their ETFs. In many cases, the fee goes down a little each month and is smaller in the final few months of your contract. Congress quieted down after that, even though the ETF stays high enough to cause indigestion when you have only a month or two to go before true freedom is yours.

However, quiet rarely endures.

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Commission seeks comment on “uses of spectrum”

If you’ve got a TV license, you’ve got a problem. After a couple of months’ of crescendoing news reports, rumors, indirect proposals, and other non-official murmurings, the Commission has issued a formal request for comments on “uses of spectrum”. But don’t let that hopelessly vague title fool you. The focus of the inquiry is the possible repurposing of TV spectrum for wireless broadband services.

Yikes! Talk about an inquiry of staggering scope and complexity, with vast implications for the economy and the very cultural fabric of our society! Not to worry, though – you have a grand total of 19 days, to December 21, 2009 (oops - make that 18 days now), within which to gather your thoughts, bundle them up coherently and ship them off to the FCC.

The motivation here is the notion that there’s just not enough spectrum currently available to “meet the demand for wireless broadband services in the near future”. Since the arrival last summer of Chairman Genachowski (motto: “Mmmm, Broadband – Is there anything it can’t do?”), the Commission has been on an All-Broadband-All-The-Time juggernaut. With Congress adding to the frenzy through its multi-billion dollar broadband stimulus give-away program, the expansion of broadband into every nook and cranny of the USofA has become a regulatory obsession. And pushed by that obsession, the Commission has set out on a quest for a modern Philosopher’s Stone that might turn base spectrum into wireless broadband-worthy gold. Some helpful (if not entirely disinterested) observers, including the wireless industry and the Consumer Electronics Association, have suggested that TV spectrum would be a good place to look.

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Comment deadlines set in “parental empowerment” inquiry

Last month we reported on the FCC’s Notice of Inquiry into parental empowerment. That notice has now made it into the Federal Register, which in turn establishes the comment and reply comment deadlines. If you’re moved for whatever reason to chime in on any or all of the questions posed in the notice – sample question: Is there “a minimum level of media literacy that parents, teachers, and children must have to ensure that children can participate effectively in modern society and enjoy the benefits of electronic media while avoiding the potential harms” – you have until January 25, 2010. Reply comments are due on February 22, 2010.

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“Permanent” discontinuation of PCS operation is the trigger – but when is discontinuation “permanent”? 

Late last month the FCC’s Wireless Bureau issued an interesting order which should have sent a chill down the spines of all Personal Communications Service (PCS) licensees who, for whatever reason, have failed to use their spectrum for a significant period of time. The Bureau declared that one poor licensee – who had voluntarily acknowledged to the FCC that it hadn’t operated its system for at least two years – had “permanently discontinued” operation. From that the Bureau concluded that the licenses had been automatically canceled.

Ouch.

The hapless licensee, Northstar Technology, LLC, had defaulted on debts to a number of Federal agencies, including the Commission (for an unpaid auction bid).   Nevertheless, it managed to negotiate a settlement with the Feds pursuant to which it would sell the PCS licenses it held and assign the proceeds over to the US of A.

A swell plan it was, but for one slight snag: because Northstar hadn’t operated its system for more than two years, Northstar’s licenses had cancelled automatically, according to the Bureau. As a result, there was nothing to sell and no proceeds to pay over to the government . . . unless, that is, the Commission was willing to waive its automatic cancellation rule. Since such a waiver would result in a payment of up to $10 million into the Federal coffers, it should surprise nobody that the rule was cheerfully waived in this particular case.

But that waiver is not the real story here. Rather, the real story is the remarkable new standard (and we’re using that term very loosely here) which the Bureau has now established as a trigger for automatic cancellation of PCS licenses.

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Another step closer to mobile spam?

Back in September we wrote about a petition for declaratory ruling filed by Club Texting, Inc., which appeared to be anticipatorily seeking a Get Out Of FCC Jail Free card for itself and others engaging in “text broadcasting”.   Deadline alert!!!  The FCC has just invited the public to comment on that petition. In a public notice issued November 9, the Commission summarizes Club Texting’s petition, and then opens the door for the Great Unwashed to chip in their two cents’ worth. Comments on the proposal are due by November 30, reply comments by December 7.

Curiously, the FCC’s public notice does not provide a link to Club Texting’s petition. Such a link would certainly come in handy to anybody who might want to take the Commission up on its invitation to submit comments. Even more curiously, when we went out to the FCC’s ECFS to try to track down the petition, we couldn’t find it – even using the spiffy new ECFS interface. No problem – we tracked down a copy of the petition  and are providing the link, above, as a public service.

The Commission’s notice tersely echoes the general points advanced by Club Texting in its petition. What the notice doesn’t emphasize is that “text broadcasting” is pretty much the same as (or, as Club Texting describes it, the “functional equivalent” of) that scourge of the late 20th Century, junk faxing. (Not surprisingly, Club Texting prefers the more benign term, “fax broadcasting”.) Nor does the public notice mention that Club Texting is touting, on its website, the fact that it has over 60 million cellphone numbers that it can make available to its customers who might want to text their important messages to some, or all, of those 60,000,000 phones. The Commission probably didn’t mention that factoid because Club Texting didn’t mention it in its petition.

Anyway, if you feel moved to comment on Club Texting’s petition, you’ve got until November 30.

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FCC solicits comments, information on interplay of broadband deployment and education at all levels

As part of its ongoing efforts to get a handle on All Things Broadband before the FCC’s homework (i.e., the National Broadband Plan, a/k/a the NBP) is due in February, the Commission has released yet another Public Notice, this time seeking comments on issues relating to the educational use of broadband. 

To ensure that the information is thoughtfully prepared and presented in a manner that will maximally assist the Commission to draft the NBP in the next three months, the Commission generously gave parties 17 days to prepare their submissions. Initial comments are due to be filed by November 20, so you can get that project off your desk before Thanksgiving. No such luck with reply comments: they’re due by December 11.

The latest Public Notice invites comments on virtually every aspect of the educational use of broadband technology.  By “educational”, it means everything from pre-K to grad school, including both institutions and students. The kind of input it’s looking for? Pretty much anything and everything, including “implementation strategies, budgets/expenses, financing strategies, programmatic goals, measured outcomes, and other detailed operational and strategic information about the programs using broadband for educational purposes.” Again, this information is to be presented by November 20.

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Trouble in River City?

If you’re looking for a good example of your tax dollars being spent – spent, yes, but not necessarily being put to work – you should check out the Notice of Inquiry (NOI) issued by the Commission on October 23. Entitled “Empowering Parents and Protecting Children in an Evolving Media Landscape”, it reads like a cross between an undergraduate course in child psychology and a weekend program on “modern parenting” that might be offered at the local community center. 

While no one can fault the Good Intentions presumably underlying the NOI – after all, Looking Out For The Kids ranks right up there with apple pie, the flag and motherhood in the pantheon of unassailable motivations – the NOI is grossly flawed in numerous ways. It lacks legislative authority, raises the specter of unconstitutionality, largely duplicates an inquiry just completed by the Commission, inserts the FCC into a regulatory area which other, presumably better suited, agencies are already working, and asks questions which are unanswerable.

If this is how the Genachowski Commission plans to deploy its resources, we’d all better fasten our seatbelts – it could be a bumpy night.

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Regular readers of the CommLawBlog who know a lot about Network Neutrality (see, e.g., recent posts here, here and here) also knew the FCC planned to open a proceeding to adopt formal Net Neutrality rules. True to its word, on October 22 it issued a Notice of Proposed Rulemaking (NPRM) that did just that.

In 61 pages of detailed legal, economic, technical and policy analysis, the FCC proposed:

• to codify the four principles the Commission previously articulated in its 2005 Internet Policy Statement;
• to codify a fifth principle that would require a broadband Internet access service provider (IASP) to treat lawful content, applications, and services in a nondiscriminatory manner;
• to codify a sixth principle that would require an IASP to disclose information concerning network management and other practices reasonably required for users and providers of content, applications and services to enjoy the protections specified in this rulemaking; and
• to make clear that the principles are subject to reasonable network management, and would not limit an IASP in delivering emergency communications or addressing the needs of law enforcement, public safety, or national or homeland security.

The NPRM also requests comments on:

• a category of “managed” or “specialized” services, how to define them, and what principles or rules, if any, should apply;
• how the new rules should govern non-wireline forms of Internet access, such as mobile wireless (an especially fertile ground for dispute), unlicensed wireless, licensed fixed wireless, and satellite; and
• enforcement procedures that the Commission should use to ensure compliance.

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An FCC letter shows why new phone services like Google Voice must soon trigger a regulatory overhaul.

An innocuous-looking letter from the FCC to Google marks the beginning of the end of the telephone system we have known for the past 130 years.

The old phone system, the one started by A.G. Bell and still in use today, has a dedicated connection between each pair of people talking to each other. Whether plugged in by a switchboard operator, in the early days, or dialed by the user, later on, whether carried by copper wire, microwave radio, satellite signal, or fiber-optic cable, every individual phone conversation has its own separate circuit which is (a) set up for just that one call and (b) taken down when the parties hang up. This is called a “circuit-switched” system.

The FCC has regulated this set-up since 1935. The details evolved over the decades. But the FCC rules, then and now, have always been geared specifically to a circuit-switched system.

One element of these rules recently became controversial. When you place a long-distance call to your Aunt Mildred in Boston, say, you pay the long-distance carrier, and it in turn pays the Boston phone company to accept the call and ring Aunt Mildred’s phone. In telephone-speak, the money changing hands is called an access charge for terminating the call. It is an important source of revenue for local phone companies. If Mildred lives in rural South Succotash, the access charges are higher, because it costs more to run a phone system where the customers are farther apart.

The differences in access charges present an opportunity for abuse. Some companies that generate a lot of inbound long-distance traffic, like conference-call bridges and sex-call services, deliberately locate in rural areas. The incoming calls then generate high access-charge revenues for the local phone company, which may split the take with the conference-call or sex-call provider. The practice is called traffic pumping. For now, at least, it is legal.

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A good slogan perhaps, but NOT the law

As the FCC prepares to impose its version of net neutrality upon wireless and wired Internet service providers (ISPs), the Internet is buzzing with comments on how such governmental intervention may affect the future development of the Internet. 

On the one hand are the application service providers (with Google leading the charge) who promote net neutrality as necessary for the preservation of the Internet. These folks did not invest in any of the transmission facilities that comprise the hardware pipeline of the Internet – but they are happy to rely on that pipeline to distribute their services.

On the other side are the ISPs (including folks who DID invest in the hardware) and technical experts who believe net neutrality is a solution in search of a problem and a dangerous overlay of regulation upon a dynamic, constantly evolving set of relationships.

This battle presents a range of legal issues. The question mentioned perhaps most often involves the FCC’s authority to regulate at all here:  the Commission (with a thumbs-up from the Supreme Court in the Brand X case) has held Internet data transmission to be an “information service” that cannot be regulated – well, at least not as common carriage. But if that’s the case, how can the Commission now try to impose common carrier-like obligations on ISPs?

Then there is the First Amendment of the U.S. Constitution.

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Abrupt reversal precedes FCC announcement of network neutrality proposals

Here is one of those little coincidences that make Washington such an interesting place to work.

Regular readers know about the friction among Apple, maker of the iPhone; AT&T, the iPhone’s broadband provider; and Google Voice, a VoIP service (among other things) that seeks to carry the calls of iPhone users.

The iPhone and its close competitors, like the Palm Pre, have two ways to access broadband: a “3G” channel provided by the carrier and paid for as part of the subscriber’s data plan; and Wi-Fi, much like that in a laptop, which of course works only at Wi-Fi-equipped locations. Apple has long allowed VoIP on the iPhone's Wi-Fi link, but never on the 3G channel. This matters to users, because relatively few of the locations where a person might want to place or receive a call have Wi-Fi service. AT&T, in responding to an FCC inquiry, was blunt about why it (and Apple) block VoIP from 3G: VoIP is a much cheaper substitute for minutes of voice service. Its use thus cuts into carrier revenues, including the revenues needed to recover the subsidy that lets Apple price the iPhone at far below its actual cost. Read more here.

But now AT&T has abruptly reversed course.

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Two weeks ago we reported that the FCC has proposed some changes in the Broadband Radio Service/Educational Broadband Service (BRS/EBS). Those proposals have now made it to the Federal Register, which in turn establishes the deadlines for comments and replies on the proposals. As we observed in our initial post, the comment periods are short: comments are due by October 13, replies by October 23. You can find the full text of the FCC’s proposal here.

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Those who think network neutrality is the answer might be asking the wrong question

The recent announcement by the FCC Chairman of impending rules on network neutrality caused a lot of stir in the press, including our own coverage here. On the whole, we think network neutrality is a good idea. But it may not achieve the Chairman's stated goal: to preserve the open character of the Internet that fostered so much creativity and innovation in its early days. Those times are slipping away. No set of FCC rules, however well intentioned, will bring them back.

We quickly forget how the Internet used to be. Early technologies of other kinds – 8-track tape players, manual typewriters, tail-finned cars – are easy to remember because we have still examples to look at. But the early Internet has vanished without a trace, save in the reminiscences of the one-time early adopters.

Ah, The Good Old Days

Before the Internet was the precursor ArpaNet, which linked a few dozen major universities and Government facilities. Mainly it was a way to transmit research data, with a pasted-on afterthought called “email” to help researchers coordinate their exchanges.

As students and employees left the ArpaNet sites, they worked out ways to stay linked to the system over ordinary phone lines. Some set up connections their friends and colleagues could dial into, thus becoming the first Internet service providers (ISPs). Using the Internet in those days took technical know-how. Conveniences like URLs and clickable links had yet to be invented. There were few graphics, mostly just text. Access was by typing into command lines. Needed functions like “finger” and “Archie” and “Telnet” were complex and hard to use. Also we walked five miles to school in the snow.

Then, in 1991, came the World Wide Web.

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With Chairman Genachowski's regime now firmly in place, the Broadband Planning Team headed by Blair Levin is moving at a furious pace to gather the information needed to develop a broadband strategy for the United States.   To its credit, the Levin team appears to be taking the task seriously as a real blueprint for action: not just another report to be sent up to Capitol Hill to gather dust on a shelf, but rather a master plan that will guide this country's transition into the new broadband age. To that end, the Commission has been holding workshops, issuing Notices of Inquiry, and generally calling for all the information and ideas it can get its hands on from all segments of the industry. All of this is being done on an expedited basis unusual for FCC proceedings which underscores both the importance of the issues being considered and the early 2010 timetable for having a finished product.   Everything seems to be open for discussion, including some of the most sacred cows in the regulatory pasture.

As we have previously reported, comments on the Notice of Inquiry on Innovation and Investment in Wireless Communications are due no later than September 30. A companion notice was issued this week in light of the comments already received in the larger National Broadband Plan NOI.  Those comments suggested very forcefully that the spectrum needed to deliver high quality 4G broadband is just not available.  Since, like beachfront property, they’re not making any more spectrum, the Commission needs to come up with a way to free up spectrum from Federal sources, re-farm spectrum currently allocated to non-broadband uses, or require more effective use of existing spectrum by incumbent licensees. Most of these alternatives send a shiver down the spine of incumbents, but folks looking to get their hands on spectrum can take hope.

Interested parties can and should file comments in response to the September 23 companion notice no later than October 23, 2009 in this latest Public Notice since it has far-reaching implications for many industry players. Reply comments may also be filed until November 13.

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FCC public notice attempts to squelch Internet rumor, but recent request for declaratory order sends a different message

Responding to a rumor that has already been circulating on the Internet for five years or more, the Commission has issued a public notice which – you should probably be sitting down for this one – denies the accuracy of the rumor! It’s charming, in a kind of down-home-folksy way, that the FCC thinks that, with the issuance of a one-page notice, it may be able to Set the Record Straight, freeing countless naifs from misinformation which the Internet-fanned rumor has forced them to embrace.

According to the notice, the “rumor”, circulated “mostly by e-mail”, warns that “a nationwide directory of cell phone numbers will be made available to telemarketers, and that consumers will start receiving telemarketing calls on their cell phones.” The Commission assures us that “[t]here is no truth to this rumor”.

But as it turns out, the “rumor” may not be too far from the truth.

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EBS leases grandfathered, other loose ends tied down, new build-out terms proposed

The status of hoary Educational Broadband Service leases has been up in the air ever since the FCC made EBS leases subject to the secondary market rules that govern most other spectrum leasing arrangements. But now, thanks to a long-awaited ruling on (among other things) an uncontested compromise proposal, things may start moving again.

The principal issue has been: how long can these EBS leases extend? Originally, such leases were limited to ten years . . . then 15 . . . then there was no limit . . . then (in 2008) the Commission re-imposed the 15-year limit, grandfathering pre-existing leases from the date of execution of the leases.  

In the FCC’s back-and-forth flip-flopping, it was that latter flip (or was it a flop?) that raised the dander of many EBS lessees – particularly those with leases which (a) may have been “executed” many years ago but (b) have not gone into effect because the start date on the leases was triggered by some other event.   The FCC’s casual ruling – perhaps inadvertently –served to severely limit the term of some such leases.

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The FCC is bracing itself for an onslaught of  comments under the heading “Fostering Innovation and Investment in the Wireless Communications Market.” The recent Notice of Inquiry (NOI) on that subject is here.

The NOI praises innovation (as do we all), and points to wireless technology as an important driver of innovation. No argument there – just count the people on the street hunched over their BlackBerrys. But that is innovation of the past, while the FCC very much looks to the future.

The NOI casts a wide net, seemingly asking every question that anyone at the FCC could think of related to the terms “wireless” or “innovation.” A complete list would run almost as long as the NOI itself. Below we provide just a sampling to convey the flavor.

First on the FCC’s list – and we heartily commend them for raising it – is the issue of regulatory delay as an obstacle to innovation. Perhaps this is an idea whose time has finally come. We ourselves had thoughts on it just last week. The NOI frankly acknowledges that FCC processes can hinder the progress of innovation and investment. “At times,” it says, “we have seen innovators subjected to lengthy regulatory processes . . . that can be an obstacle to progress in the wireless arena.” No kidding. To its credit, though, the FCC seeks a dialogue with interested parties on how to remove unnecessary impediments.

Some of the other issues raised:

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Apple, AT&T answer FCC inquiry about rejection of Google Voice

We reported here on the FCC’s requests to Apple and AT&T, the iPhone maker and service provider, asking why Apple had rejected an iPhone App called Google Voice. This provides access to a range of advanced voice features free of charge, in some instances bypassing services that AT&T charges for. The FCC also wanted to hear Google’s side of the story.

The answers came in several days ago, and we have been mulling them over ever since. (Okay, we did some of our mulling at the beach.)

Apple has not actually rejected Google Voice, it says. But neither has it accepted Google Voice. Rather, Apple continues to study the application.

Over 95% of applications are approved within 14 days of submission, so this one must fall in the other five percent. Most non-approvals occur because the program crashes or fails to function properly, according to Apple, but somehow we doubt Google submitted buggy code. Other submissions are rejected for sexual or violent content, also not a factor here. Apple’s problem with Google Voice, rather, is that the application “appears to alter the iPhone’s distinctive user experience” by, for example, handling voice mail and contact lists differently.

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(Alternate title: Jammin’ With The Cell Boys)

We have previously reported (here and here) on various aborted efforts of a company called CellAntenna to conduct tests of cell phone jamming technology around the country, including here in Washington, D.C. CellAntenna seems to have gotten the support of many state correctional officials to test its method of jamming cell phone calls made from prisons – that is, calls made on cellular phones, not calls from prison cells.   Such calls are a continuing headache to the corrections communities, who would dearly love to jam them. The problem is that the jamming technology tends to interfere with spectrum licensed to cellular and PCS carriers who are gravely concerned that other legitimate cell phone calls in the vicinity of prisons will be interrupted. More broadly, the cellular community is worried that this jamming technology could spread like the swine flu to concert halls, schools, libraries, etc., resulting in general disruption of cell phone traffic over their networks. So they have vigorously opposed real world testing of the CellAntenna equipment, even when the FCC has been somewhat willing to accommodate the tests.

Now a company called Telcore Networks seems to have gotten all parties on board. On September 1 the FCC gave Telcore an experimental authorization to test its jamming technology at the Maryland State Correctional Facility in Jessup, Maryland.  Telcore’s device apparently jams only the bad calls (those from prisoners) while letting the good, legitimate calls go through. Telcore worked with the prevailing cellular carriers in the vicinity to ensure that no interference to normal traffic would occur, and the carriers’ consent and cooperation with the test was no doubt key in getting FCC approval. It was not clear from publicly available material how the good will be separated from the bad (this side of Judgment Day, anyway), but the technology – if it works – may provide a means of dealing with a problem weighty enough to earn Congressional hand-wringing and proposed legislation. The frequencies on which the experiment are authorized include 824 -829 MHz, 869-894 MHz, 1850-1910 MHz, and 1930-1990 MHz. The test will be conducted on September 3, so interested parties expecting phone calls from prisoners in the Jessup facility on that day may be disappointed.

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We posted a blog by Paul Feldman last week, describing an FCC workshop on the relationship between economic growth and broadband deployment. Paul was surprised that four of the six presenters – primarily economists from respected academic institutions – advanced positions at odds with the Conventional Wisdom. That is, while just about everybody in Washington seems to believe that More Broadband in Rural Areas necessarily equals Greater Economic Growth, the economists’ studies indicate that the available evidence, when analyzed critically, does not completely support that belief.

Think of the economists as the kid in “The Emperor’s New Clothes”.

As Blogmeister, I get to come up with many of the headlines here. For example, the headline for Paul’s post: “Broadband Workshop: Contrarians at the Gate”. I thought it captured the essence of Paul’s observations in an attention-getting way.

Well, it did manage to get the attention of Northwestern University’s Shane Greenstein, who (with colleague Ryan McDevitt) was responsible for one of the workshop presentations.

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Everyone knows at this point about Congress’s decision to defibrillate the economy (at least for the short term) by making billions of dollars available for broadband deployment through the much-vaunted Stimulus legislation.  But in passing the Stimulus legislation, Congress also perceived a need for long-term broadband planning, and thus required the FCC to create (by February 17, 2010) a National Broadband Plan that seeks to ensure that every American has access to broadband capability. As part of the process for creating that Plan, the FCC has been holding workshops with various interested parties to seek data and ideas.

On July 26, I attended the webcast of one of those workshops. From its title (“Economic Growth, Job Creation, and Private Investment”), I expected the workshop’s participants to repeat what has been the conventional wisdom about broadband, i.e., that expansion of broadband is core to economic growth and job creation. 

I was in for a surprise.

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It’s official! The FCC has formally announced that the deadline for reg fees this year will be 11:59 p.m. (ET) on (drum roll . . . fanfare) September 22, 2009. But why wait until then? The teller windows are now open at Fee Filer, so why not avoid the late September rush and check this chore off your to-do list right now.

The newly-officialized deadline is indeed the same as was reflected in the reminder letters received by many a week or two ago. While we had informally heard from a Commission staffer that that date might get moved a tad, that plan apparently got nixed – possibly because of the potential for confusion that it reeked of.

When you do pay your reg fees – and, given the penalities for non-payment, there really is no option here – don’t forget to include payments for all your auxiliary licenses. The reminder letter sent out by the Commission lists only your main channel(s), and leaves it to you to track down those pesky auxiliaries (the fee for which is $10 each). While the 25% late charge on a $10 fee may not look bad, the other, non-cash, penalities – including possible red-lighting – should be scary enough to get you into ULS tout de suite to doublecheck your list of auxiliaries against what the FCC thinks you have.

We here at Fletcher Heald will be happy to assist in getting reg fees paid. Let us know if we can help.

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BUT applications must be “pending” in Easygrants® System by August 14

RUS and NTIA have announced that the deadline for submitting BIP and/or BTOP applications electronically has been extended from August 14 to 5:00 p.m. (Eastern time) on August 20, provided that such applications were already “pending” in the on-line “Easygrants® System” by August 14.

According to RUS/NTIA, the volume of activity by prospective applicants has caused “service delays” on the Easygrants® System. To make sure that everybody gets a chance to complete applications that they’ve started, the agencies have beefed up their own infrastructure by adding servers, and have extended the submission deadline.

In order to be eligible for the extended August 20 deadline, an applicant must have its application “pending” in the system as of 5:00 p.m. on August 14. That means that the applicant must have taken the following steps by then:

            1.         Log into the Easygrants® System at www.broadbandusa.gov;

            2.         Select “Start a new application” under “Apply for a new grant/loan;”

            3.         Select one of the two choices for available funding opportunities;

            4.         Select “Continue;” and

            5.         Select “ok” when prompted “Are you sure you want to apply for the program.”

All other requirements for electronic filings remain the same as set out in the NOFA. No changes have been made to any instructions, requirements or deadlines relative to paper submissions.

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You may be getting a letter from the FCC in the next couple of days (if you haven’t already) alerting you to the deadline for this year’s regulatory fees.  That letter – which will not bear any signature of any FCC official or identify any originating office within the FCC – will probably say that the deadline is September 22. 

Don’t necessarily believe it.

 We have been informally advised by the Commission’s staff that the letters were prepared and shipped out by an outside company to which the FCC had given the September 22 date some time ago.  But in the meantime, the Commission’s staff has apparently determined that either September 23 or 24 might be a better date.  We are told that an official notification – including a banner to be prominently displayed on the FCC’s website – is in the works.  Of course, the final date may turn out to be September 22 after all, just like the letter says.  Sometimes you never know about these things.

Needless to say, whatever the final deadline might be, you are not required to wait until the very last minute to file your fees.  Au contraire.  You should feel free to file your fees at your earliest convenience.  As far as we can tell, the fees specified in the letter notifications that got sent out may be correct (although, as we have previously warned everyone, those notifications do not include fees for any auxiliary stations).  In other words, with the letter in hand you should be able to figure out what you owe.  So you might even be in a position to file your fees today.

Not. 

Unfortunately, as it turns out, the Commission’s Fee Filer system has not yet been set up to accept this year’s reg fees.  And, as we have previously reported, all reg fee filers this year must start the payment process through Fee Filer.

When will you be able to file your fees?  When will you have to file your fees?  At this point nobody seems to know for sure.  We expect all of these questions to be cleared up reasonably quickly.  Check back here to CommLawBlog for updates on getting your reg fees filed.

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DTV-only as of October 1, 2008? This is your lucky fiscal year!

While pre-October 1, 2008, termination of analog operation was clearly the exception rather than the rule, it appears that stations which did shut down their analogs before October 1 are getting a free reg fee ride this year. In looking through the Commission’s recent reg fee order, we noted the following statement relative to DTV operation: “[S]tations that were broadcasting in digital only on October 1, 2008 would not be assessed regulatory fees for their digital license for FY 2009.”  (Stations that were broadcasting in both analog and digital modes as of October 1, 2008, however, will be required to pay regulatory fees, but those fees relate only to the analog operation.)

This exemption is limited: it does not get eligible stations off the hook for other regulatory fees that may be due, such as those for studio-transmitter links, remote pick-ups, satellite earth stations, and the like. Rather, the exemption relates only to the reg fee for the main broadcast license. (Of course, the payment for that license normally represents the lion’s share of the amount due.)

The FCC’s largesse is consistent with its treatment of DTV for the past several years.

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Letters sent to Apple, AT&T in expansion of “network neutrality” inquiry

The FCC recently expanded its “network neutrality” inquiries into an ongoing contretemps among three giants of consumer technology: Google, Apple, and AT&T. The dispute follows Apple’s disallowing Google Voice service on its iPhone handsets, possibly at the request of AT&T, the carrier having exclusive rights to the iPhone.

Network neutrality is the idea that communications customers, such as Internet and cell phone subscribers, should be able to use all lawful services and hardware without interference from the provider. It sounds simple enough, but in practice the issues get a little complicated. See here and here and here. Back in 2005, the FCC enunciated four “principles” of network neutrality, but has not adopted actual rules on the subject.

Wireless phone providers have traditionally favored the opposite of neutrality: a “closed” model in which the same company supplies over-the-air service, sells the handsets, and picks the services users can access. If you obtain cell phone service through one of the major carriers – Sprint, AT&T, Verizon, or T-Mobile – you probably bought your phone from them, too. And if you use the phone for on-line banking and certain other lucrative services, chances are the company you’re dealing with pays the carrier for the privilege of having your business.

The FCC has two proceedings underway that could eventually challenge this kind of arrangement.

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Filing deadline still unannounced

The Commission has adopted its final schedule of Regulatory Fees for 2009. You can find the new fees listed in Appendix C of this Report and Order. (Since the R&O – including its nine appendices – runs to 68 pages, it may be helpful to point out that Appendix C appears at pages 21-23 in the PDF version you will find when you click on the link.)

The new fees are, with one exception, the same as the Commission proposed last May. We described those proposed fees here. The sole exception is the fee associated with AM CPs. Here’s a surprise: the final fee ($400) turns out to be $80 less than the FCC had originally proposed!

The only real change this year is that electronic payment of all reg fees must be started through the FCC’s Fee Filer system as of this year. The Commission recognizes that some folks may not be able actually to pay through the Fee Filer system. (For example, the fees for some licensees may exceed $100,000, and credit card payments in such amounts may not be a happening thing.) But at a minimum, everybody is supposed to start at Fee Filer because that will enable them to generate a voucher Form 159-E which, the Commission assures us, “will have important electronic attributes associated with this regulatory fee payment.” With very limited exceptions, anyone not paying their fees through Fee Filer will need a voucher Form 159-E to accompany their payments.

Accessing the Fee Filer system requires you to have a current FCC Registration Number (FRN) and associated password. If you don’t have an FRN, we would be happy to help you work through the CORES system to get one.

As it has done for the past five years, the Commission will again send out “assessment notifications” to all broadcast licensees, advising them of the reg fees associated with their primary licenses. But, also as in past years, those notifications will NOT include any necessary fees for auxiliary licenses. This is important to remember, because even though auxiliary fees don’t show up on the FCC’s notifications, such fees are still required to be filed – and a failure to file even the weeny little $10 fee for, say, a remote pickup unit can result in “red light status” affecting all your licenses.

We expect the deadline for reg fees to be announced shortly.  Check back here to CommLawBlog.com for updates.

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Feds clarify frequent questions about stimulus programs, including application of “net neutrality” considerations

You think you’re the only one with questions about the broadband stimulus programs? Guess again. There are enough questions flying around that the Feds have posted, with a minimum of fanfare, a 13-page set of Frequently Asked Questions regarding the BTOP and BIP programs. Check them out here. 

We have been concerned with a question about the reach of the net neutrality requirements imposed on BTOP and BIP awardees. 

FAQs to the rescue! 

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There’s no such thing as a free lunch

With $4 billion ready to fly out of the government’s till and into the hands of private businesses, it’s easy to understand the enthusiasm which the government’s Broadband Stimulus programs (i.e., the RUS/NTIA BIP and BTOP, about which much has been written here on CommLawBlog.com) has generated. But hold on a minute. Sure, the thought of “free” money for building broadband facilities is nigh on irresistible – but let’s not forget that there’s no such thing as a free lunch.

In fact, the strings that are attached to BTOP grants may be more like thick steel cables, or even chains. Potential applicants should weigh the benefits of receiving a BTOP award against the obligations that accompany such awards.

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While our Broadband Stimulus 101 series has focused mainly on the BIP and BTOP, the Recovery Act also funded another, more esoteric program: the State Broadband Data and Development Grant Program (Broadband Mapping Program). The goal of that program is to develop a reliable database reflecting the actual deployment and adoption of broadband services nation-wide. Basically, the government wants a clear picture of what kind of broadband service is available where, and who’s using it. Each state is responsible for coming up with a data gathering and mapping plan the results of which will be fed into a national “broadband map” which Congress has directed NTIA to prepare by February, 2011.

Funds from the Broadband Mapping Program are intended for states or their designees – which means that, if you’re a private individual, company or organization and you have your eye on any of this cash, you should start getting close with the relevant folks in your state government ASAP. Compared with the billions of bucks flooding the BIP and BTOP, the $240 million available for the Broadband Mapping Program may look like a paltry drop in the bucket, but $240 million is, well, $240 million.

If you have any interest in the Broadband Mapping Program, NTIA is presenting an “on-line workshop” on the program tomorrow, July 24, from 1:00-3:00 p.m. (EDT). You have to sign up at least two hours before start time. You can do so (at no cost!) at  https://www2.gotomeeting.com/register/538335482 or just click on this link and complete the registration form. Don’t worry if you miss the live version, though –  NTIA will be recording the festivities, which will be available at www.broadbandusa.gov. (And if you’re really into the program, you can even email questions in to NTIA at broadbandmapping@ntia.doc.gov before the workshop.)

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Elaborate scoring systems to be applied by RUS, NTIA

Having set aside $7.2 billion to fund broadband-related projects, the government is now working on getting that cash flowing – but in ways that achieve the goals identified by Congress as efficiently and effectively as possible. In other words, simply dumping 72 million $100 bills out of the back of a cargo plane, while certainly a way to get the cash out fast, won’t do the trick.  Instead, the agencies tasked with doling out broadband stimulus funds have attempted to set up objective criteria against which proposed projects will be judged. Applicants seeking broadband funding must understand these criteria and the scoring methods to be used to determine which projects are worthy of funding.

The following is a detailed summary of the scoring systems that will be used to rank applications for stimulus funding.

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“Proposed funded service areas”: what they are, what differences they make

The RUS/NTIA Notice of Funds Availability (NOFA) – about which much has already been written (like here and here) – puts an end to months of speculation about how, exactly, the government plans to allocate the billions of dollars earmarked for broadband development.

Now we know . . . or at least we have a better idea.

The Feds are doling out the stimulus cash based both on geographical/demographic considerations and on the level of broadband service already available in the areas proposed to be served. And to complicate matters, the funds are being distributed through two separate but partially overlapping programs – the Broadband Initiatives Program (BIP), administered by the Rural Utilities Service (RUS), and the Broadband Technology Opportunities Program (BTOP), run by the National Telecommunications and Information Administration (NTIA). And while the BIP is directed to facilitating broadband deployment in rural areas, the BTOP includes three different types of projects – infrastructure in unserved/underserved areas, enhanced broadband capacity at public computer centers, and “promoting sustainable broadband adoption projects.”

The fun comes in trying to figure out who gets what under which program. The following is a primer on factors to be aware of in crafting infrastructure-related proposals for either the BIP or BTOP. (Check back to CommLawBlog.com later for further information on the non-infrastructure aspects.)

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It looks like the Obama Administration’s effort to open the door for U.S. companies to provide telecom services in Cuba has taken a step forward, and then a step (or maybe just half a step) back. But either way, there appears to have been movement recently – enough to justify this reminder to keep on your toes if you’re thinking about moving into the Cuba market.

Last April the Administration announced its intent to lift many of the longstanding U.S. sanctions against Cuba.  On the telecom side, the Secretaries of State, Treasury and Commerce were directed to enable providers to: enter agreements to establish fiber-optic and satellite links between the U.S. and Cuba; enter roaming service agreements with Cuban telecom providers; provide and pay for telecom, satellite radio and television services for Cuban customers; and export certain donated communications devices.

The Office of Foreign Assets Control (OFAC) began crafting new regulations immediately to effectuate the President’s directive.  We spoke with an official in OFAC’s Licensing Division on July 17, 2009, and were told that those rules have been finalized and delivered to the White House. 

That’s the good news.

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Funding tied to expanded principles of “neutrality”

Network neutrality, still in a long gestation, is gradually finding its way into the law – most recently, as a condition of participating in the broadband stimulus program.

Though lacking a widely-accepted definition, the term “network neutrality” generally refers to the concept that Internet users should have unfettered access to content and services – in other words, that service providers should not be allowed either to impede or to favor access to particular sites. Most proponents agree on two exceptions: for legitimate law enforcement (to block, say, child pornography), and for “reasonable network management.” The latter, in practice, usually amounts to finding ways of throttling back the small percentage of people who take up a large percentage of the available bandwidth. CommLawBlog.com has featured several posts about developing issues in network neutrality, including here and here.

Service providers by and large dislike the whole idea. Some want the option of charging sites extra money for delivering their content faster to consumers, or of offering consumers content that is not available through competitors. None wants the government probing into its network management practices. If the country decides it wants network neutrality, as a matter of policy, regulation will be necessary.

The FCC made a start in 2005, when it adopted four “principles” of neutrality. These declare that consumers are entitled to:

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August 14 deadline for the first $4 billion looms

As we previously reported, on July 1 the Rural Utilities Service (RUS) and the National Telecommunications and Information Administration (NTIA) released the long and eagerly awaited rules governing the distribution of billions of dollars in stimulus funds to expand broadband service in the United States. The 121-page tome, dubbed a Notice of Funds Availability (NOFA), lays out in detail how much money is to be distributed in the first funding round, adopts critical definitions of "rural," "unserved" and "underserved" areas, specifies how the applications will be "scored" to determine who gets the money, and prescribes the elements that must be included in each application on pain of dismissal. We will address these elements below, but be warned: some of the provisions will be so difficult to comply with that anguished outcries from prospective applicants have already been heard on Capitol Hill.

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Expanded conditional license opportunities, greater tolerance for adaptive modulation in the works

Microwave radio serves as the nation's nervous system. (Microwave ovens, a different technology, take care of the stomach.) These radios operate through the ubiquitous sideways-facing dishes and domes on radio towers, water towers, and tall buildings. Their signals regulate the movements of railroad trains, control the electric grid and natural gas and oil pipelines, carry long-distance telephone calls and Internet traffic, transport TV programming to cable systems, send 911 messages to the local police station, deliver cell phone calls to the towers, tell the ATM your bank balance, and carry vast amounts of data that fuel ordinary businesses nationwide.

Many of these systems operate at availability levels in excess of 99.9999% (“six nines,” in industry parlance). This allows for outages adding up to no more than 30 seconds per year – not bad for systems that sit high up outdoors, exposed to the weather year round.

The FCC is considering three changes that would help improve the operation of these systems.

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$4 billion in broadband stimulus funding available for the asking, with more on the way

On July 1 the National Telecommunications and Information Administration (NTIA) and the Rural Utilities Service (RUS) of the Department of Agriculture released their initial “Notice of Funds Availability” (NOFA) with respect to two broadband-related programs funded through the American Recovery and Reinvestment Act of 2009 – what many have dubbed simply the Stimulus Package.  Applications for funding in this first round will be accepted from July 14, 2009 at 8:00 a.m. (ET) until August 14, 2009 at 5:00 p.m.   

In other words, the teller’s window is about to open, the “Free Money – Come and Get It” sign is about to go up, and the line is getting ready to form. So come on down, but first be sure to familiarize yourself with the separate and distinct programs through which funds are being made available, the various eligibility requirements associated with each program, the conditions, limitations, expections, etc. germane to each, and the extensive application requirements. All this and more is contained in the 121-page NOFA.    

If you want to be first in the door, you should start reading the NOFA right away: the complex and detailed directions are, at least at first glance, daunting.

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Christmas comes early for late-filing applicants

After sitting on a host of late-filed Educational Broadband Service (EBS) and Broadband Radio Service (BRS) renewal applications for more than two years, the Wireless Bureau's Broadband Division (Division) finally decided on June 16 to accept the filings and process the applications.   More than 116 EBS licensees had for various reasons neglected to file their last renewal application by the prescribed deadline. 

In many cases, the affected licensees were confused about whether a renewal application was fileable when the underlying station had not yet been constructed. Such confusion was understandable because, when responsibility for such applications moved from the Mass Media Bureau to the Wireless Bureau, there was a change of policy on this issue. (Old Media Bureau policy: if you hadn’t constructed your station, don’t bother to file for renewal; New Wireless Bureau policy: even if you hadn’t constructed, you have to file for renewal.) But the Wireless Bureau never bothered to issue any public notice of that change of policy.The Division decided that it was unfair to administer the administrative death penalty to licensees who had failed to comply with the unannounced policy since that policy, well, hadn’t been announced.

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The Commission may have only three sitting Commissioners, but that didn’t stop them from unanimously adopting new number portability provisions in a Report and Order and Further Notice of Proposed Rulemaking (R&O/FNPRM) released May 13, 2009.  In the R&O portion of the decision, the Commission reduced the porting interval for simple wireline and simple intermodal port requests. Under the new rules, all entities subject to local number portability rules must complete simple wireline-to-wireline and simple intermodal port requests within one business day. (“Intermodal ports” here include wireline-to-wireless ports, wireless-to-wireline ports, and ports involving interconnected Voice over Internet Protocol (VoIP) service.)

Previously, such simple wireline port requests had to be completed within four business days. However, the wireless industry has established a voluntary standard of two and one-half hours for wireless-to-wireless ports, and the Commission saw no good reason why wireline-to-wireline requests could not also be completed within one business day for most carriers. Furthermore, a shorter porting requirement would help consumers by shortening wait times and increasing the benefits of local number portability provisions.

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The Commission has released its Notice of Proposed Rulemaking (NPRM) laying out its proposed 2009 regulatory fees. To no one’s great surprise, for the second year in a row all but one of the 61 categories of broadcast-related fees are proposed to go up. (The lone exception is the fee for a broadcast auxiliary license, which – also for the second year in a row – is proposed to remain at $10.) The proposed fees are listed in Appendix I to the NPRM.

And when we say “up” we mean “UP”. Reg fees for all full-service TV licenses in the Top 100 markets would increase by more than 9%, with UHF stations in the Top 10 going up by more than 14% and VHF’s in Markets 11-25 up by more than 13%. 

On the radio side, Class C AM’s in all markets are looking at double digit surges mainly in the 13%-14% range (and as much as 15.4% for stations serving populations of 25,001-75,000). Class D AM’s would fare only slightly better, with increases in the 11%-12% range (except for those serving fewer than 25,000 listeners – they’d only get whacked for a 9.5% increase). All FM stations are looking at reg fees that would be 5%-9% higher than last year.

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It appears that the Commission’s technical team has successfully resolved the problem reported in our last update. Recent anecdotal observations indicate that the “new” application filing fees – you know, the ones which were adopted by the Commission last September, and which officially went into effect on April 28 – are finally being automatically generated by the Commission’s CDBS on-line application filing/fee payment systems.  (No word yet on whether the problem has been resolved on the Commission’s IBFS database.)

As recently as May 11, a glitch in the system was resulting in licensees being prompted to pay the old, lower, fees.  But as we reported then, the Commission will not be giving a free pass to those who paid the incorrect fees during this time.  The Commission may approach each licensee individually to request the difference in fees, or may announce a set of procedures for licensees to submit the additional fees.

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FCC invites comments on birders’ proposals regarding tower approvals

If you think you might be needing to build a tower in the next several years, listen up. The birding lobby has opened a new offensive in its long-running effort to force the FCC to give greater consideration to bird-related concerns when it authorizes tower construction.

Recently, the Commission invited comments on the following proposals advanced by the birders:

• Amend the Commission’s environmental regulations so that exclusions from those rules are available only for FCC actions that have no significant environmental effects individually or cumulatively;
• Prepare a programmatic environmental impact statement addressing the environmental consequences of the Antenna Structure Registration (ASR) program on migratory birds, their habitats, and the environment;
• Promulgate rules to clarify the roles, responsibilities and obligations of the Commission, applicants, and non-federal representatives in complying with the Endanger Species Act (ESA); and
• Consult with the U.S. Fish and Wildlife Service on the ASR program regarding all effects of towers and antenna structures on endangered and threatened species; and
• Complete the proposed rulemaking in the Migratory Birds Proceeding to adopt measures to reduce migratory bird deaths in compliance with the MBTA.

Oh, and did we mention that all of these proposals are supposed to be implemented on an expedited basis?

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Faithful readers will recall that we titled the last installment of our “Pursestrings Updates” series the “final chapter”. We spoke too soon. 

On April 28, the Commission’s new application filing fees finally went into effect, after a series of delays about which we dutifully reported here . . . and here . . . and here  . . . and, well, you get the point.  We figured that, with its formal announcement of the April 28 date, the FCC had things under control.

We should have known better.

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Court chides FCC for delay on intercarrier compensation proceeding.

Swatting aside claims that the FCC had, again, violated the Regulatory Flexibility Act (RFA), the U.S. Court of Appeals for the D.C. Circuit has upheld the Commission’s Intermodal Number Portability order. That order was initially adopted by the agency in 2003, but then set aside by the Court in 2005 because of RFA problems. A couple of  years later, the Commission finally got around to addressing those RFA problems, and the Court has now approved that second effort.

But in so doing, the Court has signaled its impatience with the FCC’s slow-motion deliberations in the related intercarrier compensation (ICC) proceeding.

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First reaction to the Big Decision

[Blogmeister's note: Our crack team covered the oral argument in Fox last November, and will be providing additional coverage of the Court's decision released April 28.  The following is one commentator's view of the landscape.]

The Supreme Court has issued its long-awaited decision in FCC v. Fox Television Stations, Inc., the case involving the application of the FCC’s indecency policy to “fleeting expletives”. By a 5-4 vote, the Justices concluded that the FCC’s action was consistent with its statutory obligations under the Administrative Procedure Act. Accordingly, they reversed the contrary decision of the U.S. Court of Appeals for the Second Circuit and remanded the case back to the Second Circuit. Score one for the Commission.

While any decision favoring the Commission’s indecency policy in any way is troubling, the good news here is that the Supreme Court’s ruling changes very little on the indecency front. To the contrary, its primary effect in the indecency area is to set the stage for the next, and far more important, act in this long-running drama.

But the news is not all good. Lurking behind the high profile “celebrities talking dirty on TV” allure of the case is a major shift in a seemingly mundane legal doctrine, a shift that could affect FCC regulatory activity in all respects for years to come. So while many commentators may choose to dwell on the obvious “indecency” aspects of the ruling, the real importance of this decision lies elsewhere.

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New application fee schedule still set to take effect April 28, 2009.

For those procrastinating on filing applications with the Commission, now is the time to act if you want to save a few bucks.

As we reported on March 26, the Commission’s new broadcast application fee schedule will go into effect on April 28. (Application fee schedules for other services also kick in next Tuesday, April 28. You can find a collection of 2009 Fee Filing Guides for all services here.) The current fees have been in effect far longer than the Commission originally contemplated, as faithful readers of the first five or six installments of our “Pursestrings Update” series know.  But the fun ends on Monday night: all the new fee schedules will become effective at 12:01 a.m. on Tuesday morning.

Please let us know if we can help you pull together any last-minute filings to beat the deadline.

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Whistleblowers can challenge bidding credit claims, reap big rewards

With the public issuance of letters (DA 09-822, DA 09-823 and DA 09-824) to certain winners in Auctions 58 (PCS licenses), 66 (AWS licenses) and 73 (700 MHz licenses), the Commission has lifted the curtain ever so slightly on a melodrama that has been playing out in the Federal District Court since 2007. While we still don’t know the entire cast of players, much less how the melodrama will be resolved, we can say one thing for sure: it is NOT a good idea to try to play cute with the FCC’s bidding rules in an effort to secure undeserved bidding credits. Even if the FCC doesn’t catch you, a little-known provision of Federal law provides private parties both a major league financial incentive to blow the whistle on such misconduct and a non-FCC forum in which to blow that whistle.

The source of the somewhat obscure process is the False Claims Act. Usually invoked by “whistleblowers” eager to call attention to waste in the government procurement process (think hammers bought by Uncle Sam for $5,000 a pop), the FCA permits anyone to file a complaint “on behalf of the U.S. Government” to recover ill-gotten gains. (The cognoscenti refer to such actions as “qui tam” suits – don’t ask why.)  To sweeten the deal, another provision of the law also permits the person making the claim to skim off up to 30% of any settlement or damages award that might result. And since the Act also provides for treble damages, the potential payday can easily reach into the eight digits.

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A CommLawBlog scoop: Agency brainstorming on possible "consolidated licensing system"

Word on the street (actually, word around the FCC) is that the Commission is embarking on a quest for what some might view as the bureaucratic equivalent of the Impossible Dream: an Uber-consolidated on-line licensing system to unify the balkanized collection of existing systems currently in use. This would mean “hello” to a new “Consolidated Licensing System” and “see ya” to the Universal Licensing System (ULS), OET’s Experimental Licensing System, the International Bureau’s “MyIBFS”, and the Media Bureau’s (apparently mis-named, or at least prematurely named) “Consolidated Database System” (CDBS). At this point, it’s not clear whether any other systems – such as the FCC’s tower registration operation – would also be included.

On-line filing – whether it’s used for license applications, routine reporting, or other requests or notifications – is obviously a Good Idea. It streamlines processes, permits easy on-line access to filed materials, facilitates cross-checking and searching, pushes the initial inputting burden onto the applicant (rather than the FCC’s staff), saves paper, and generally makes life better. Oh sure, there have been the occasional complaints about the user-friendliness of, say, ULS (née 1998) and CDBS (née 2000). And yes, some users have carped about how you can’t simultaneously search the various databases for information about a particular entity, or a particular location, etc.

But maybe, just maybe, the FCC has heard those cries of despair and frustration.

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Pesky strings from Dillon’s Rule may complicate formation of public/private partnerships

As interest in snagging a piece of the broadband stimulus builds to fever pitch, it may be a good idea to sound a cautionary note with respect to one obscure, but potentially important, quirk in U.S. law that could mess up a lot of plans. (We have previously reported – here, here, and here – both on the American Recovery and Reinvestment Act of 2009, a/k/a the Stimulus Package, and on the various administrative efforts being made by the FCC, NTIA and RUS to flesh out the skeletal details provided by Congress in the Act itself.) 

I’m talking about Dillon’s Rule. Never heard of it? Not surprising. Despite its importance, it’s easy to overlook, unless you happen to have an interest in the jurisprudence of state and local governments. But overlook it at your peril. Dillon’s Rule could effectively bar, or at least seriously complicate, efforts by private entities to successfully dip into the deep pool of stimulus funds through the device of public/private partnerships (a device recommended by a number of supposed gurus).

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20-minute ex parte meetings may be scheduled from March 20 – April 3

As we have previously reported, the FCC has no direct role in doling out the $6.8 billion available for broadband stimulus under the American Recovery and Reinvestment Act (what we know as the Stimulus Act). However, the FCC is charged with consulting with the Department of Commerce’s NTIA and the Department of Agriculture’s RUS in setting some of the basic criteria for deciding who gets the funds.  Among the most important issues facing the money-meisters in the next month are: coming up with basic definitions for “unserved” and “underserved” areas and “broadband” (how fast a speed must you provide to qualify and should different criteria apply to wired vs. wireless systems); what constitutes “non-discrimination” in the provision of broadband; and what network interconnection obligations (including net neutrality) should apply to program recipients. These are questions that the FCC has struggled with for years, but it and its friends at NTIA and RUS must now come up with answers in a matter of weeks. 

The FCC is therefore accepting written comments until April 13 on these issues – lightning speed for any administrative agency. It is also scheduling ex parte meetings with the staff limited to 20 minutes from March 30 to April 3. (Imagine a sort of administrative speed dating with a bell ringing every 20 minutes and parties running from one meeting room to the next.)    Although the FCC’s role is consultative, we do expect the FCC ‘s recommendations to carry some heavy weight in the final outcome of these definitions – particularly since current FCC Commissioner Adelstein has recently been nominated to become head honcho at RUS – so interested parties may want to weigh in. Read all about it here.

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Senate bill calls for “inventory of airwaves” to identify spectrum for more broadband, advanced communications use

With several trillion dollars’ worth of bills stacking up on the kitchen table, the Senate is thinking about searching for quarters under the sofa cushions.

When times get tough around the household, what’s a tried and true way of generating some quick cash? A yard sale, of course. So in these dire economic times, some Senators have proposed – in S. 649, a bill introduced on March 19 – that Congress get ready for a Federal spectrum yard sale by making a list of all the spectrum controlled by NTIA and the FCC.   (The Senators in question are former presidential wannabe John Kerry and co-sponsors Olympia Snowe, Roger Wicker and Bill Nelson.) 

After all, the public picked up $20 billion in pin money from the 700 MHz auction. Maybe lightning can strike twice.

In fairness to the bill’s sponsors, their goal supposedly is to assure that we will all be able to find “additional spectrum” to “meet the growing demands and needs of consumers and businesses alike.”   The bill’s sponsors seem particularly interested in opening up space for more broadband and advanced communications services. But in her statement in the Congressional Record, Snowe correctly observed that “there is no new spectrum to allocate, only redistribute”, which would seem to put the kibosh on the notion of finding “additional” spectrum. So it appears that the sponsors contemplate that spectrum already in use is going to be changing hands – a process which has in the recent past tended to result in payments to the guv’mint.

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The sharp-eyed policy wonks here inside the Beltway spotted a line item in President Obama’s budget proposal called a “spectrum license user fee.” This tax – sorry, fee – would be assessed against users of spectrum blocks that are licensed but not auctioned. These include most AM, FM, and TV, most two-way mobile radio and fixed microwave, and all satellite, amateur radio, and several other categories. Unlicensed spectrum, such as that used for Wi-Fi and Bluetooth, would be exempt. Even so, the new fee is projected to bring in $200 million in 2010, increasing steadily to $550 million by 2019.

Outraged at this extra dip into the pockets of hard-working Americans? We don’t blame you. But don’t call your congressman quite yet. The chances of anybody ever actually paying this fee are small. The reasons have to do with the annual Washington ritual of budget politics.

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The joint NTIA/RUS “request for information and notice of public meetings” we described here yesterday has been published in the Federal Register on March 12. That publication establishes the deadline for written comments as April 13, 2009. Instructions for submission of comments are set out at the end of the Federal Register notice. A couple of tips: if your comments are longer than five pages, you’re supposed to include a one-page executive summary; if they’re 10 pages or more, you also need a table of contents. You can file electronically. In fact, NTIA/RUS would prefer you do so, especially if your comments are 10 pages or longer. One disincentive for paper filers: if you go the paper route, you also have to include a CD or DVD with an electronic version of your submission, properly identified on the label. Let us know if we can be of any help in preparing any submissions you might want to make.

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Lots of questions, not a lot of answers as agencies gear up broadband funding programs

As we previously observed, the newly-enacted-but-still-to-be-implemented Stimulus Package leaves a lot of questions unanswered. Having earmarked billions of dollars for expansion of the country’s broadband Internet facilities and services, Congress dumped into the laps of various agencies the chore of building the Federal systems – essentially, a bureaucratic ATM – necessary to dole out the Big Bucks. But Congress didn’t bother to include any helpful assembly instructions.  

On March 10, in their first joint public appearance to address the issues, the agencies in charge confirmed the existence of questions, but provided precious few answers – which is not surprising, given the inchoate and largely undefined responsibility which Congress handed to them.  The agencies are, of course, doing their diligent best to tackle that responsibility by raising all of these questions as early as possible. But the fact remains that at this point, the questions far outnumber the answers.

The agencies in question are the Department of Commerce’s National Telecommunications and Information Administration (NTIA), the Department of Agriculture’s Rural Utilities Service (RUS), and our pals at the FCC. The Stimulus Package assigns NTIA and RUS – in consultation with the FCC – the task of devising detailed regulations for the funding of proposals to construct and provide broadband service in “unserved”, “underserved” and “rural” areas. So far we’ve seen two steps taken in that process.

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Editors' Note: Let’s be honest. The first day on a new job usually stinks. Everything’s new and different. Everybody’s trying to weasel up to your good side. Big and Important Stuff definitely needs to get done, but right out of the box it can be hard to tell the Big and Important Stuff from the Totally Unnecessary and Possibly Counterproductive Stuff.

As a public service, we here at CommLawBlog have put together a "To Do" List for Julius Genachowski when he arrives on the Eighth Floor of the FCC. (We know he hasn’t been confirmed yet, but who really believes that that’s going to be a problem?)  

But what do we know? The Chairman-Designate would probably benefit even more from suggestions from CommLawBlog readers. We down here in the CommLawBlog bunker merely have our fingers on the pulse of the Regulated Nation; you ARE the pulse of the Regulated Nation.

We’re sure Mr. Genachowski would welcome additional input from the blogosphere for his To Do list. Check out our initial thoughts below, then post your own using the comment box at the end of our list.

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More fines on the way as FCC ramps up CPNI enforcement

Look out below! The Commission has lowered the boom on telecommunications carriers who apparently didn’t file their Customer Proprietary Network Information (CPNI) certifications when they were supposed to last March. An “Omnibus Notice of Apparent Liability” (ONAL) was issued late on February 24 directed against some 600 carriers.   At $20,000 per violation, the FCC’s take could run upwards of $12,000,000.

As we reminded one and all a couple of weeks ago, in 2007 the Commission began requiring each carrier to submit (by March 1 of each year, starting in 2008) to the Commission a compliance certificate, signed by a company official, stating that he or she has personal knowledge that the company has established operating procedures that are adequate to ensure compliance with the CPNI rules. The seriousness of this requirement apparently didn’t sink in fully with a large number of carriers, all of whom seem simply to have ignored it. That’ll be $20,000, please – payable to Uncle Sam. (Of course, each carrier identified in the ONAL will have the opportunity to explain why it should not be liable for a forfeiture – but since they have all already had an opportunity to demonstrate that they did in fact comply with the certification rule, and since they all apparently came up short in that department, it’s difficult to be optimistic about their chances at avoiding a fine at this stage.)

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Is there really a free lunch?

The ink had not even dried on the American Recovery and Reinvestment Act of 2009 (what you and I would call the Stimulus Package) before troubled industries began feverishly scanning the hundreds of pages of legislation to see if there were any goodies in there for them. Telecommunications had not seemed like a particularly troubled sector, at least compared to the manufacturing, financial, retail and other sectors which have been swimming in ever-deepening red ink for the last few months. There was nevertheless a perception that America is falling behind other countries in broadband penetration, and something needed to be done about it – pronto.  Congress therefore graciously set aside $6.8 billion for distribution to the teeming masses yearning to provide, or get access to, broadband.

And teeming masses is right. It seems there is no one remotely connected to the broadband industry who does not feel deserving of his or her fair share of the billions to be distributed. As NTIA and RUS – the two federal agencies primarily charged with administering the program – frantically gear up to distribute vast sums of money in the bureaucratic equivalent of a nanosecond, one naturally asks: how can I get my hands on some of that money? When the cannon sounds and all the buckboards race off to lay claim to great swathes of free money, how can I get there first?

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WTB nixes prison test of cell phone jamming technology

Never mind the personal jet packs. We just want a little gadget in our pocket with a pushbutton on it, so when the teenager behind us in line at the post office – or worse, sitting next to us on a long and crowded commuter train ride – whips out her cell phone and starts in, "And I was like, No! Really? And he was like, Well, yeah. And I was like, No!. . .", we can push the button. And she's like, "Hello? Hello?" while her cell phone flashes "Out of Service Area."

Wouldn't that be great?

Not according to the FCC.

Last month we reported that the FCC had okayed a January 8 demo of wireless phone jammers in the District of Columbia jail. The authorities argued that prisoners with cell phones can cause trouble even while incarcerated, and saw jammers as a solution. The wireless phone industry vigorously opposed. The January demo never happened. The prison authorities renewed their request early in February. Late on February 18 the FCC's Wireless Telecommunications Bureau (WTB) reversed course and turned them down.

Notwithstanding our own frustration – in the post office, train, and elsewhere – we can think of some good reasons why the WTB is right to disallow even temporary and limited use of jammers.

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Commission compels carriers to conclusively tie down customer’s consent

The U.S. Court of Appeals for the D.C. Circuit has issued a decision upholding the Commission’s 2007 Order relating to the necessary mechanism for obtaining customer approval for release of customer proprietary network information (“CPNI”). That mechanism imposes greater burdens on carriers than had been the case prior to 2007.

Under the Communications Act, certain customer information – including the customer’s specific calling plans, special features, pricing and terms, and details about whom they call and when – is deemed “proprietary” and is supposed to be kept confidential.  Still, that information is useful for carriers’ marketing purposes: some carriers directly market new or different services to their customers based on CPNI, while others contract with joint venturers or outside third parties to use this information to market for them. 

Before using CPNI for marketing, carriers must have the customer’s approval. The big question in this case is how that approval is supposed to be obtained.

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The U.S. Court of Appeals for the D.C. Circuit has held that “retention marketing” practices used by Verizon violate Section 222(b) of the Communications Act. As a result, it may be more difficult for Verizon – and other incumbent carriers – to avoid losing customers in the competitive telephone market.

Telephone customers can move from one carrier to another, and they can take their telephone numbers with them. But when they do so, somebody’s got to tell the old phone company to release the customer’s number to the new phone company. That chore generally falls on the new phone company (in this particular case, the new company happened to be cable operators providing phone service), which sends the old company a local service request (LSR) to “port” the number.

Of course, when it receives an LSR, the old phone company learns that that customer is looking to defect to the competition. Attempting to make lemonade out of that particular lemon, Verizon took the opportunity to contact defecting customers (identified through incoming LSRs) and offered them incentives to stay with Verizon. This is a practice known as “retention marketing”.

But Section 222(b) of the Act prohibits a carrier from using for its own marketing efforts any proprietary information that it receives from another carrier "for purposes of providing any telecommunications service." The Big Question, then, was whether Verizon’s use of information from the LSRs ran afoul of that prohibition.

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The concept of “harmful interference” is central to FCC spectrum policy. The FCC has never said just what the term means. Oddly, though, that might be a good thing.

Nearly every band of the radio spectrum is shared among two or more categories of users. If we think of the spectrum as being spread out horizontally, the users of each band are stacked vertically. To see how this looks, click here.

Each band has a predetermined pecking order among its users: primary, secondary, and unlicensed. The relationships among all of these turn on harmful interference. Specifically:

• “Primary” users are protected against harmful interference from all other users.
• “Co-primary” users – services in the same band jointly designated as primary – may not cause harmful interference to each other.
• "Secondary” users may not cause harmful interference to primary users, and must accept harmful interference from primary users.
• Unlicensed users may not cause harmful interference to primary or secondary users, and must accept harmful interference from everybody.

The notion of harmful interference being key to the whole enterprise, we might expect to find a crisp and objective definition in the FCC rules. But when we look, we find something else. It comes in two parts:

In the case of a radio-navigation service (like GPS) or a safety service (police, fire, distress beacons, etc.), harmful interference is anything that “endangers” its functioning.

In the case of any other licensed service, harmful interference is whatever “seriously degrades, obstructs, or repeatedly interrupts” the service.

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On January 22, President Obama elevated Commissioner Michael Copps to the position of Acting Chairman of the Commission. Copps, who has been a Commissioner since 2001, will preside over the slimmed-down three-person Commission until a permanent Chairman takes over. Former Commissioner Tate left the agency in December  when her term ended, and former Chairman Martin bailed out as of Inauguration Day – leaving Acting Chairman Copps to rule the roost over remaining Commissioners Adelstein (D) and McDowell (R). No word yet on how long it may be before the Commission returns to full five-member strength (or who might be filling at least one of the two empty seats). Repeated media reports have indicated that President Obama intends to nominate Julius Genachowski – an Obama Harvard Law School chum and Chief Counsel to Former FCC Chairman Reed Hundt – to be permanent Chairman, but until the President makes a nomination and that nominee is confirmed by the Senate, Copps is The Man.

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If you’re a telecommunications carrier (and FYI – we’re not just talking about POTS and cellular here – think VoIP operators, satellite operators, international resellers and others as well), the FCC wants to be sure that you don’t forget that your annual CPNI certifications are due between January 1 and March 1.  The Commission has issued a public notice reminding everyone about those certifications, and also helpfully providing a suggested template to be used. CPNI – which stands for Customer Proprietary Network Information – is information relating to the quantity, type, destination, location, amount of use and configuration of service.

CPNI is inherently private information, and the FCC’s CPNI rules are designed to protect customers’ CPNI against unauthorized access and disclosure. (While the CPNI rules have been on the books since the late 1990s, the FCC’s interest in enforcing them increased dramatically in 2007 after media disclosures of “pretexting” practices used to obtain CPNI surreptitiously. For further background on CPNI, see the May and September, 2007 issues of FHH Telecom Law.)

One measure adopted by the Commission in 2007 is the annual certification requirement. Each year, telecommunications carriers must have an officer sign and file with the Commission a compliance certificate stating that he or she has personal knowledge that the company has established operating procedures that are adequate to ensure compliance with the rules. The carrier must provide a statement accompanying the certification explaining how its operating procedures ensure that it is or is not in compliance with the rules. Additionally, the carrier must include an explanation of any actions taken against data brokers and a summary of all customer complaints received in the past year concerning the unauthorized release of CPNI.

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On Friday, December 12, we told you that the Commission had released the agenda for their final hurrah of 2008 (scheduled for December 18) - remember? Well, that was sooo yesterday’s news. 

Late that same day, the Commission announced that the December 18^th meeting was cancelled. After the Agenda was released Thursday evening, Chairman Martin received a letter from Representative Waxman and Senator Rockefeller asking the Commission to cancel the meeting and expend the Commission’s resources on the DTV Transition. Apparently, there were items on the agenda, including the AWS-3 Auction, that had raised substantial controversy and the members of Congress did not want the Commission to be distracted from the DTV Transition. According to the FCC spokesman, after receiving the letter, Chairman Martin determined that it did “not appear that there [was] consensus to move forward and the agenda meeting has been canceled.”

The public notice indicated that the Commissioners will resolve the seven items that were on the agenda via circulation. So, just like the weather in Washington, if you don’t like what's on the FCC Agenda, wait ten minutes, and it may change…

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The FCC has announced its official agenda for its final meeting of 2008, to be held Thursday, December 18, 2008 in Room TW-C305 at the Commission with a tentative start time of 10 a.m.  At the meeting, the Commission is currently planning to consider seven items:

1. A spectrum auction rules/free broadband proposal
2. Wireless license renewal
3. DTV translator service
4. Cable carriage rules
5. Violations of the Commission’s DTV consumer education requirements
6. Wireless, enhanced 911 location requirements; and
7. Satellite Digital Audio Radio Service.

Admission is free and open to the general public.  For those who cannot make it in person, audio/video coverage of the meeting will be broadcast live with open captioning over the Internet at www.fcc.gov/realaudio.

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 For almost three years now, the FCC has been struggling mightily to devise rules to govern both the auctioning and regulatory framework for the 700 MHz D Block.   This spectrum block has the unique distinction of being a Public Private Partnership -- a concept never before tried by the FCC and one which has proved elusive to nail down. As most folks in this galaxy are aware, the FCC earlier this year auctioned off most of the 700 MHz band which had been freed up by the relocation of UHF broadcast stations. It netted a tidy $20 billion or so, but failed to get any takers for the D Block at the reserve price which had been set.    The problem, the industry said, was that there were too many uncertainties surrounding the Public Private Partnership. Not only would the winning bidder have had to pay at least $1.33 billion for the license, but then it would have had to negotiate a sharing agreement with the public safety licensee. An auction bidder who failed to successfully negotiate a deal -- a negotiation in which it had limited leverage -- would then have been faced with a massive default payment. If the negotiations were successful, the winner would have the privilege of building out a vast nationwide public safety radio system at its own expense. It is no wonder that bidders were skittish about racing to place their bids.

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On August 7, 2008, the FCC released new rules (FCC 08-148), implementing the Warning Alert and Response Network ("WARN") Act, under which the Commercial Mobile Alert System ("CMAS") will be implemented by cellular telephone, PCS, and other Commercial Mobile Radio Service providers.  The CMAS will allow local, regional, and national emergency alert messages to be delivered to cellphone and other mobile radio terminals.

Carriers may opt in or out of the CMAS.  Those who decline to partipate at all or who choose to participate in only part of their service area must give clear and conspicuous notice to all new customers at the point of sale, including where sales are made by third-party agencies.  A carrier must notify existing customers of an election not to participate by amending the terms and conditions of their service contracts, giving notice in the same way they notify subscribers of other contract changes.  Prepaid service providers are included in the notice requirement; but because they often do not know the identity of their customers, they may give notice through text messaging and other electronic means if they choose not to use paper mail.  Carriers who participate fully may give notice or not, as they choose.  Carriers that elect to participate but later change their mind must notify their subscribers of their changed plans 60 days before curtailing or discontinuing service

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On July 3, 2008, the U.S. Court of Appeals for the 8th Circuit upheld the application of telephone gross receipts taxes on cellphone companies (Cities of Jefferson City and Springfield, Missouri vs. Cingular Wireless et al., case No.  7-2884).  The cellphone companies claimed that they were providing "Commercial Mobile Radio Services," and that term does not appear in ordinances imposing a tax on "telephone" and "telephonic" services.

After dodging numerous procedural obstacles, the Court said that cellphones are used to make telephone calls, the cellphone companies market them for use in making telephone calls, and most users think that their cellphones are intended to be used to make telephone calls.  In other words, it if looks like a telephone, walks like a telephone, and quacks like a telephone, it must be a telephone.  The fact that CMRS services may be treated differently from wireline services in other regulatory areas does not mean that cellphone service is not subject to taxes on telephone services.

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By Robert M. Gurss

For years, the FCC has been working to encourage Part 90, private land mobile radio licensees to convert to more efficient, narrowband radio equipment.  The original equipment required 25 kHz channels.  As of January 1, 2013, licensees in bands below 512 MHz must operate on 12.5 kHz channels (or with equivalent efficiency).  That will require some licensees to replace very old radios, but equipment deployed since the late 1990s should already have 12.5 kHz capability.

The FCC recently clarified what it expects for the next step, conversion to 6.25 kHz channels.  There is currently no date by which such a conversion is required, and the FCC has said that it will monitor technology to determine when it may mandate such further "narrowbanding."  Last year, the FCC had seemed to suggest that licensees now using 25kHz equipment might be required to go directly to 6.25 kHz.  This alarmed some licensees and equipment vendors who feared that users would hold off on the "immediate" step of going to 12.5 kHz capability.

In response, the FCC released a order this week indicating that it had "not intended to dissuade migration to 12.5 kHz technology by licensees that have already begun the process."  Nevertheless, the FCC reiterated that licensees who do not intend to convert from 25 kHz until shortly before the 2013 deadline "should consider the feasibility of migrating directly to 6.25 kHz technology."   This continues to raise concerns, as it remains to be seen how 6.25 kHz technology will develop and whether it will meet the needs of all land mobile radio users.

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In November, the Commission issued a Second Report and Order and Notice of Proposed Rulemaking regarding its ongoing initiative to ensure that those with hearing disabilities will have access to digital wireless communications. 

This action comes on the heels of the Joint Consensus Plan that was submitted in June 2007 by parties representing the deaf and hard of hearing community, along with major wireless service providers and equipment manufacturers.  The Joint Consensus Plan proposed new requirements for the technical capabilities of new wireless devices, and new deadlines for the wireless industry to meet the benchmarks.  It also sought to modify the rapidly approaching  February 18, 2008 deadline for wireless carriers to offer hearing aid-compatibility in at least 50% of their products.

In the "Order" portion of the Commission's piece, the Commission declined requests to expand to independent retailers the FCC requirement that customers be able to test the devices at the point of purchase.  The Commission also declined to require manufacturers with small product lines to come into compliance with the hearing aid requirements.  In both cases, the Commission did not find that the public record supported these requests, but agreed to seek additional comment in the NPRM stage of this proceeding.

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The FCC recently issued an NPRM seeking comments on whether it should implement procedural rules for petitions for forbearance under Section 10 of the Communications Act as part of the Telecommunications Act of 1996. The NPRM can be found here. It looks as though the Commission will try to act quickly on this reform agenda as there are several petitions for forbearance queued up on the docket.

Forbearance from enforcing a regulation is warranted when the Commission determines the regulation is not needed to protect consumers or to ensure just and reasonable rates and practices by carriers or when it would otherwise promote the public interest. As it is now, if the Commission does not act on a petition for forbearance within a year (plus a potential, one-time 90 day extension) it is deemed granted.

The NPRM signals that the Commission wants to take a hard look at the procedures for granting forbearance in general and specifically:

• Whether new rules should govern the format and content of forbearance petitions,
• Whether new notice and comment rules, such as default comment periods and time limits on ex parte filings, should be adopted, and
• Whether other rules would facilitate the participation of state commissions, as well as other parties, in forbearance proceedings.

The Democratic Commissioner's Copps and Adelstein issued statements that signaled their intent to rein in the practice of forbearance, with Commissioner Copps lamenting that the FCC was becoming the "Forbearance Communications Commission."

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The U.S. Court of Appeals for the D.C. Circuit has affirmed in part and vacated in part the Commission's 2006 decision classifying IP-transport prepaid telephone calling cards and menu-driven calling cards as "telecommunications services." The decision may be found here.

"IP-transport cards" use internet protocol technology to transport part or all of a phone call. Because part of the call utilizes IP technology, AT&T argued to the FCC that IP-transport cards constitute an "information service", as opposed to a "telecommunications service" -- this despite the fact that the Commission had previously ruled that similar so-called "IP-in-the-Middle" calls were NOT information services.

"Menu driven cards" use a menu-driven interface through which users can either make a call or access several types of information. AT&T had argued to the FCC that the offering of information (such as weather or news) through either a menu or an operator qualified it is an "information service."

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We have been reporting that the conditions which the FCC has attached to the D Block in the upcoming 700 MHz auction have made the block less attractive to potential bidders. 

The D Block is the nationwide 10 MHz band which gets shared with the public safety licensee in emergencies and also must build out the public safety network at its own expense, in exchange for non-priority access to that band.) 

Frontline had argued that the FCC should permit the D Block to be resold without regard to the "material relationship" rules that would normally preclude a Designated Entity from reselling or sharing more than 50% of its spectrum.

Although it claimed to be acting "on its own motion" rather than in response toFrontline's petition for reconsideration, the Commission granted Frontline partial relief by allowing resales and other bulk arrangements to exceed 50% without violating the rule.  However, they also stressed that the 25% material relationship rule would continue to apply.  That is, if the D Block licensee resells or has bulk arrangements with a single entity for more than 25% of its spectrum, that entity's revenues are counted in determining whether the D Block licensee remains entitled to a Designated Entity discount. 

The full text of the order can be found here.

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The FCC has changed the rules for 10.7-11.7 GHz fixed microwave antennas, allowing service providers to install dishes that are only two feet in diameter, instead of the mostly four foot units heretofore required. 

The band in question is well suited to "backhaul" of wireless services -- i.e., the delivery of signals to and from the familiar cell towers dotting the landscape. As the wireless phone companies roll out mobile broadband and other data-hungry services, they need more capacity -- not only from tower to customer, usually carried on auctioned spectrum, but also from their own distribution facilities to the towers. Some of that traffic moves over fiber, but microwave is easier to install at many locations. 

Until now, FCC rules required large antennas at both ends of the link. Some towers and rooftop mountings cannot accommodate the weight and wind-induced forces. Big antennas are expensive. And many zoning authorities try to ban them as being unsightly.

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In a little-noticed Report and Order issued in June, the FCC addressed a number of issues regarding international telecommunications services which had been pending for some years.  One of the more interesting items was the FCC's determination that when customers of US-based CMRS carriers roam abroad, their calls back to the US over foreign carriers' facilities are an international call subject to US law.

The status of roaming has been very cloudy at the FCC -- some view it as merely a billing arrangement among carriers while others view it as a common carrier service subject to the full panoply of Title II regulation under the Communications Act.  In the June Order, the FCC ruled that roaming is indeed a common carrier service, which means that a CMRS carrier must have a so-called Section 214 certificate in order to offer international roaming  to its customers while abroad.

This may stimulate a run for such certificates since the need for them had not been clear prior to this Order.  In addition, although the FCC did not address this issue, the logic of its reasoning would suggest that foreign CMRS carriers whose customers roam in the US must also have a Section 214 authorization from the FCC - something most foreign carriers have never bothered to acquire.  More business for the International Bureau.

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The FCC has granted Corr Wireless Communications, LLC's request to be relieved of the obligation to provide analog service over its cellular facilities.   Corr demonstrated that it had very few remaining analog-only customers and that the need to continuing serving these customers until the spring of 2008 was actually impeding its ability to improve and expand service to its far more numerous digital customers.    The FCC did require Corr to offer to transition the remaining analog customers to digital service at no cost and to certify that there would be no diminution of its coverage area as a result of the conversion to all-digital operation.

While in a digital mood, the FCC shortly thereafter, in a separate action, denied the alarm industry's bid to extend the analog service requirement for two years.  The Commission seems to have gotten the message that there are really some benefits to all-digital operation, and the seven years that customers have had to say goodbye to their analog phones is more than enough.

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The FCC today required providers of "interconnected VOIP" service -- essentially, voice-over-Internet service to and from ordinary telephone numbers -- to contribute to the Telecommunications Relay Service (TRS) Fund and to make TRS available to subscribers. Dialing 711 on a TRS-equipped system connects the caller to a live operator equipped with a TTY device, thus enabling communications between a person using an ordinary telephone and a speech- or hearing-impaired person using TTY.

This step continues the FCC's ongoing process of bringing interconnected VOIP under the same regulations as conventional landline telephone service, on the theory that the two are largely interchangeable. Interconnected VOIP was earlier made subject to regulations relating to CALEA (for law enforcement wiretaps), E-911 (to locate emergency callers), Customer Proprietary Network Information (for privacy), and the Universal Service Fund.

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Skype, a voice-over-Internet provider, wants the FCC to break the cell companies' stranglehold over customer handsets, reprising the liberation of wireline customers forty years ago.

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The FCC today clarified a point which had long been a source of confusion for those engaged in the E-911 distribution chain: over what geographic area must a carrier measure compliance with the Commission's accuracy requirements? Some carriers had argued that their compliance level should be measured over their entire national network, a yardstick that would effectively boost their accuracy levels because of the overwhelming proportion of compliant calls in urban areas. Others had argued more narrowly for a BTA- or individual license- based measure. At the far extreme was the public safety community, who argued for measurements by each individual Public Safety Answering Point territory - an area often as small as a county and the hardest to demonstrate compliance over.

The FCC tentatively came down, as it so often does, on the side of the public safety community. The issue is now up for public comment, with many of the details still to be worked out.

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