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

But the technical solution ran into an economic problem. While people with hearing aids could easily put hearing aid compatible telephones in their homes, those telephones were scarce elsewhere. The institutions responsible for putting phones into places like hotels, workplaces, public libraries, etc., had little incentive to spend more for hearing aid compatible equipment.

This kind of stand-off rarely goes away without regulation. In 1988 Congress duly stepped in, and passed a statute instructing the FCC to address the problem. The next year the FCC launched a sequence of rules that required a specified fraction of the telephones accessible to the public to be hearing aid compatible. That fraction has gradually increased since. Today, hearing aid compatibility is required for every wireline telephone manufactured – or imported for use – in the United States, including cordless phones.

The initial rules exempted cellphones, which were not all that common anyway in 1988. But in 2003, with wireless phones well on the way to ubiquity, the FCC reversed course. It required manufacturers of wireless phones to make available a certain number or percentage of models that are hearing aid compatible.

By 2003, though, the vast preponderance of wireless phones were digital. Adding hearing aid compatibility to a digital cell phone is technically difficult, at least compared to a traditional wireline analog phone. Stray low-level signals from digital circuits in the phone tend to produce audible interference in the hearing aid, particularly with GSM phones used by AT&T and T-Mobile. Another problem is a simple shortage of space. A modern smartphone contains a lot of components: up to six two-way radios (for 3G and 4G data, 800 MHz and 1.9 GHz voice, Wi-Fi, and Bluetooth), receivers for GPS and sometimes FM, antennas, display, camera and flash, tilt sensors, microphone and speaker, processor and memory, and a battery. All of this fits into a case a little bigger than a playing card and less than half an inch thick. Designers understandably resist having to configure components to minimize interference to hearing aids.

Under the post-2003 FCC rules, a wireless phone has two separate ratings for hearing aid compatibility. The “T” rating, from one to four, measures the effectiveness of communications using a coil. The “M” rating, also from one to four, assesses interference when the hearing aid does not use a coil, but instead picks up sound from the telephone earpiece.

To complicate matters, the hearing aid itself also receives an “M” rating. This denotes the hearing aid’s ability to suppress incoming interference, including the stray signals from a wireless phone. An M1 rating indicates the least resistance to interference, and M4 the most. To determine whether a particular digital wireless telephone is likely to interfere with a particular hearing aid, one adds the M ratings of both devices. A sum of four or above means the combination is usable; a sum of six or greater predicts excellent performance.

The FCC requires manufacturers and wireless service providers to ensure that some, but not necessarily all, of the handsets they offer carry at least T3 and M3 ratings. Very approximately, about a third of a manufacturer’s handsets, and half of a nationwide carrier’s handsets, must meet the requirements. The hearing aid compatible handsets cannot all be “plain vanilla,” but must span a range of features and functionality. Carriers must allow customers to test compatibility with their own hearing aids in the store prior to purchase.

Manufacturers and wireless carriers alike – even companies like Circle-K and 7-Eleven that carry prepaid phone cards and cellphones – must file annual reports with the FCC that list their hearing aid compatible handsets. And somebody at the FCC reads the reports. A small regional carrier in Northwest Alaska recently agreed to write a check for $13,000 to settle a claim that it offered too few hearing aid compatible models. To its credit, though, the FCC has a proceeding underway to assess whether the rules are accomplishing their intended purpose.

The engineering procedures for arriving at T and M ratings are highly complex. The FCC has outsourced the details to the American National Standards Institute (ANSI), a non-profit organization that sets standards for everything from (literally) the threads on nuts and bolts to interconnections in the national energy grid. Instead of devoting many pages of the FCC rulebook to the technical specifics, the FCC simply cites to the relevant ANSI standard. Unfortunately, when ANSI updates its standards, as it does periodically, the FCC must update the references in its rules. That requires a full-dress rulemaking proceeding. One such is underway now, a 25-page Notice of Proposed Rulemaking that basically just adds a newer ANSI standard. 

Updating to the new standard is important. It will improve testing procedures, and also expand the standard to cover frequencies (including the new 700 MHz band, which some wireless carriers have recently begun using to provide 4G data service) beyond basic cellphone bands. Without the update, new technology products soon expected on the market might be exempt from compatibility requirements. (The FCC allowed the iPhone to be exempt when it first appeared.) Issues in the rulemaking include a cut-off date after which the current standard may no longer be used, and whether manufacturers must apply one standard or the other, rather than cherry-picking parts of each.

Comments and reply comments on the ANSI update are due 30 and 45 days, respectively, after publication in the Federal Register, which has not yet occurred. We will post the due dates here when they are announced.

While no one can argue with the goal of helping hearing-impaired folks get access to cell phones, a question certainly arises as to whether the market itself would address that problem more directly by simply meeting the needs of customers. The handset market is highly competitive, and in a well-functioning marketplace, the addition of HAC features should win consumers who need that capability. The heavy hand of Soviet-type market intervention may not necessarily deliver what the people need or want. 

We have seen situations, for example, where customers actually preferred not to buy an HAC phone, but rather to use an adapting device that works in conjunction with their hearing aid and their existing handset. Since that device promotes precisely the goal the FCC is targeting – i.e., affording the hearing-impaired easier access to mobile telecommunications – you might think that the Commission’s rules would encourage the development and marketing of such devices. Yet according to the FCC, such a device – standing alone or when used in connection with an otherwise non-HAC unit – doesn’t count for HAC compliance. So even though a carrier may be giving the consumer what he actually wants and needs in the way of HAC capability, it gets no credit under the FCC's rules.

Also questionable is the severity of the penalties imposed by the FCC. We have seen cases where carriers have been fined $15,000 dollars for each handset that they are short in meeting the requisite HAC percentages. By contrast, a carrier who fails to light and mark a tower structure properly – thus creating a direct hazard to human life – may be fined significantly less. Query whether, on our scale of penal values, a risk to human life should be rated as less reprehensible than a small diminution in the variety of cellular handsets available to consumers.  

So there appears to be merit to taking a step back at this juncture and taking a hard look at how the system is working.   Carriers and manufacturers who are subject to these rules may wish to weigh in to let the Commission know what’s good and bad about the current regulatory framework.

Here are some of the specific questions the FCC is posing:

• Are the FCC's HAC rules effectively and efficiently resulting in improved HAC handset availability with a wide range of features?
• Are the special compliance circumstances of smaller carriers being appropriately handled?
• Is the system effectively and efficiently gathering needed HAC information and disseminating it to those who need it?
• Are point of sale disclosure and testing requirements effective and useful?
• Do wireless headsets create any special problems?
• Are the Commission’s rules stimulating innovation and investment in HAC technology?

Comments in response to the Bureau’s inquiry are due by February 14, 2011; reply comments are due by March 1, 2011.

The new rules are widely seen as addressing the “iPhone exemption” from the HAC obligations.    The previous rules included a de minimis exemption from the HAC requirements for handset manufacturers who made only one or two handset models per air interface. This seemingly tiny loophole was intended to avoid overburdening small manufacturers. A major beneficiary of the exemption, however, turned out to be none other than Apple, which was able to manufacture millions and millions of iPhones without complying with the HAC standards. The reason? Apple made only one model and so fit comfortably under the exemption.

No longer.

The FCC has now plugged that loophole by jiggering with the eligibility requirements for the de minimis exemption. Among other changes, the exemption is now limited to “small” manufacturers, i.e., those with 750 or fewer employees. Non-exempt manufacturers must make at least one HAC phone using acoustic coupling and at least one inductive compliant device if it makes three or fewer devices. Apple had argued that the imposition of this requirement would stifle innovation of the type that produced the popular iPhone in the first place, but the FCC concluded that access for the hard of hearing was more important. The revised de minimis provisions go into place two years after the Order is published in the Federal Register.

The FCC has also adopted a forward-looking plan to facilitate the integration of multi-band phones – including even phones using frequency bands for which standards haven’t yet been developed – into the overall HAC regulatory scheme. It did so by delegating to its staff the authority to impose rules with respect to frequencies for which new standards are adopted in the future by the American National Standards Institute (ANSI). (ANSI will be adopting HAC standards for more frequencies regularly in the years ahead.)   Once a technical standard has been adopted, the staff is to make the requirement applicable on 12 months’ notice to Tier I carriers and 15 months’ notice to others.   Heretofore there had been some question about how to handle phones which worked on multiple frequencies only some of which were subject to ANSI standards.

In another future-oriented move, the FCC has clarified that its HAC rules apply only to “handsets operating in a normal voice mode and typically held to the ear.”   As smart phones converge more and more with computers, it could become difficult to distinguish a small laptop computer with a microphone and speakers from a large telephone handset, since both may have the capability to initiate and conduct voice calls. The FCC’s clarification relieves computer manufacturers of concern on this score.   

The FCC has also changed its rules to lasso in handset manufacturers who do not sell their products through cell phone service providers. Previously, the rule applied only to manufacturers whose equipment was sold through the normal carrier distribution channel (i.e., through service providers). Now, however, manufacturers who distribute through big box stores like Best Buy, online, at their own stores or even directly to businesses for distribution to their employees will be covered.  (Manufacturers will have 12 months from Federal Register publication of the Order to bring themselves into compliance.)

In the Order, the Commission tabled a few suggestions such as display screen and volume controls pending its next annual review of the field. At the same time, it has proposed several additional rule changes. 

First, the Commission has proposed extending the HAC rules to emerging technologies such as VoIP over WiFi.  Such Internet-based voice services are expected to grow rapidly as broadband becomes a substitute for voice telephony.   While it would be consistent to apply the HAC rules to devices serving functionally identical purposes, there is still some question about the permissible scope of the FCC’s authority. The Hearing Aid Compatibility Act (which compels the FCC to regulate in this area) directs the FCC to ensure access to “telephone service”. But does a voice communication which passes entirely outside the traditional phone network truly involve access to “telephone service”?

The Commission’s initial proposal is to write itself a blank check on that score: it would define the term “telephone” to “encompass anything that is commonly understood to be a telephone or to provide telephone service, as that understanding may evolve over time, regardless of regulatory classifications evoked elsewhere in the Communications Act”. Under that definition, obviously VoIP and its kin would clearly be subject to the FCC’s jurisdiction. Still, having been slapped down recently on its authority to regulate the Internet, the Commission may be feeling a little skittish about asserting jurisdiction without public input. Accordingly, it has asked for comment on this interpretation.

The Commission has further sought comment on whether it could extend its “in-store” testing requirement to non-service providers.  The current rules require stores operated by carriers to permit in-store testing of HAC devices. The FCC presumably has authority over common carriers to require such testing in connection with their licensed activities, but it is far from clear that such authority extends to independent stores that merely happen to sell telecom handsets. The Commission thinks that the Communications Act gives it authority to regulate “retail operations that have become enmeshed in the provision of wireless service.”  But the FCC gets to that result by relying on precisely the stretching kind of argument that was soundly rejected by the court when the FCC claimed jurisdiction over the Internet, so this particular proposal may need some re-thinking. Finally, the FCC has asked for comment on how to handle the special problem of GSM-based 1900 MHz band handsets which can be made compliant by operating at lower power levels. Comments on this phase of the inquiry will be due 45 days after the Commission’s order is published in the Federal Register.