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.

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.