[Federal Register Volume 63, Number 154 (Tuesday, August 11, 1998)]
[Proposed Rules]
[Pages 43026-43032]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-21258]



[[Page 43025]]

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Part V





Federal Communications Commission





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47 CFR Parts 20 and 64



Commercial Mobile Radio Services and Miscellaneous Rules Relating to 
Common Carriers; Proposed Rule and Final Rule

  Federal Register / Vol. 63, No. 154 / Tuesday, August 11, 1998 / 
Proposed Rules  

[[Page 43026]]



FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 20 and 64

[WT Docket No. 98-100; GN Docket No. 94-33; FCC 98-134]


Commercial Mobile Radio Services and Miscellaneous Rules Relating 
to Common Carriers

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This Notice of Proposed Rulemaking (NPRM) was adopted 
contemporaneously with a Memorandum Opinion and Order that granted in 
part and denied in part a petition for forbearance filed by the 
Personal Communications Industry Association (PCIA). The Memorandum 
Opinion and Order is summarized elsewhere in this edition of the 
Federal Register.
    In this Notice of Proposed Rulemaking, the Commission asks 
questions designed to elicit specific information relevant to 
determining whether, and in what respects, the Commission should 
forbear from applying additional provisions of TOCSIA to CMRS providers 
and aggregators, continue applying these provisions to those parties, 
or modify or eliminate its rules implementing TOCSIA to address the 
different circumstances faced by CMRS providers. The Commission also 
seeks new comments regarding forbearance from regulation in wireless 
telecommunications markets that is responsive to current statutory 
standards and market conditions.

DATES: Comments are due on or before August 18, 1998, and reply 
comments are due on or before September 2, 1998.

FOR FURTHER INFORMATION CONTACT: Jeffrey Steinberg at (202) 418-0620 or 
Kimberly Parker at (202) 418-7240 (Wireless Telecommunications Bureau/
Commercial Wireless Division).

SUPPLEMENTARY INFORMATION: This is a summary of the Notice of Proposed 
Rulemaking in WT Docket No. 98-100, adopted as part of the Memorandum 
Opinion and Order and Notice of Proposed Rulemaking, FCC 98-134, on 
June 23, 1998 and released July 2, 1998. The Memorandum Opinion and 
Order portion of this document is summarized elsewhere in this edition 
of the Federal Register. The complete text of the Memorandum Opinion 
and Order and Notice of Proposed Rulemaking is available for inspection 
and copying during normal business hours in the FCC Reference Center 
(Room 239), 1919 M Street, N.W., Washington, D.C. and also may be 
purchased from the Commission's copy contractor, International 
Transcription Services, (202) 857-3800, 1231 20th St., N.W., 
Washington, D.C. 20037.

Synopsis of the Notice of Proposed Rulemaking

I. Notice of Proposed Rulemaking

A. Application of TOCSIA to CMRS Aggregators and OSPs

    1. In the Memorandum Opinion and Order, with regard to TOCSIA, the 
Commission determined that, except for the provisions relating to 
unblocked access and the filing of informational tariffs, the record 
was inadequate to support forbearance from applying the provisions of 
TOCSIA and the Commission's implementing regulations to CMRS OSPs and 
aggregators. PCIA, however, made several arguments that could, if 
adequately supported, establish grounds for forbearing from enforcing 
some or all of those provisions. Consistent with the deregulatory 
intent of the 1996 Act, and with the more specific forbearance 
directive of section 10 and biennial review requirement of section 11, 
PCIA's arguments merit further inquiry. Accordingly, in this Notice of 
Proposed Rulemaking the Commission asks questions designed to elicit 
specific information relevant to determining whether, and in what 
respects, the Commission should forbear from applying additional 
provisions of TOCSIA to CMRS providers and aggregators, continue 
applying these provisions to those parties, or modify or eliminate its 
rules implementing TOCSIA to address the different circumstances faced 
by CMRS providers.
    2. In this Notice of Proposed Rulemaking the Commission proposes to 
consider applying modified TOCSIA regulations to CMRS providers and 
aggregators as well as eliminating the application of certain 
regulations and statutory provisions. The adoption of any appropriate 
modifications to the regulations implementing the statute should 
promote the public interest both by relieving CMRS providers and 
aggregators of regulatory burdens that are ill-suited to the CMRS 
context and by providing consumers with targeted measures for their 
protection.
    3. The Commission tentatively concludes that any decision to 
forbear arising out of this Notice of Proposed Rulemaking will apply to 
providers and aggregators of all services classified as CMRS. The 
Commission seeks comment on this tentative conclusion.
    4. Before addressing the provisions of TOCSIA and the Commission's 
implementing rules individually, the Commission also seeks comment on a 
few matters that underlie its consideration of many of these 
provisions. PCIA argues that many of the provisions of TOCSIA are 
unduly burdensome as applied to broadband PCS providers because these 
providers may not be able to distinguish users that obtain service 
through an aggregator from other users of their services. The 
Commission seeks comment as to whether all broadband PCS providers, and 
other CMRS providers, are in fact currently unable to identify calls 
that are placed or received through aggregators. If some aggregator 
calls can in fact be identified, the Commission requests specific 
information as to what factors, including the type of CMRS involved, 
technical attributes of the underlying provider's network, or the type 
of aggregator arrangement, permit such identification. The Commission 
also seeks clarification as to whether calls made through aggregators 
cannot be distinguished from all other CMRS calls, or only from certain 
types of calls (e.g., roaming calls). To the extent that some 
aggregator calls cannot be identified, the Commission further seeks 
comment regarding whether it would be feasible for providers to 
introduce the capability to identify these calls and, if so, at what 
cost.
    5. The Commission also seeks comment on the different contexts in 
which CMRS is now or could in the future be offered through 
aggregators. The record includes evidence of a variety of different 
transient uses of mobile telephone service, including air-to-ground 
telephone service on commercial airlines, the leasing of phones along 
with rental cars, mobile phone booths at special events, and the rental 
of phones by hotels and shopping malls. The Commission seeks further 
information on the distinguishing characteristics of each of these 
arrangements, and on any other contexts in which CMRS is aggregated. In 
particular, when addressing particular provisions of TOCSIA, commenters 
should consider whether the statutory provisions and regulations have 
different impacts depending on the type of aggregator arrangement in 
question. In particular, the Commission seeks comment regarding how 
proposed schemes under which the calling party pays for airtime might 
affect the arrangements between CMRS providers and aggregators and the 
impact of TOCSIA and the Commission's implementing rules.

[[Page 43027]]

    6. Aggregator Disclosure and OSP Oversight of Aggregators. TOCSIA 
and the Commission's rules require aggregators to post ``on or near the 
telephone instrument, in plain view of consumers'' information designed 
to aid consumers. This information includes, for example, (1) the name, 
address, and toll-free telephone number of the provider of operator 
services; (2) a written disclosure that the rates for all operator-
assisted calls are available on request, and that consumers have a 
right to obtain access to the interstate common carrier of their choice 
and may contact their preferred interstate common carrier for 
information on accessing that carrier's service using that telephone. 
The Commission requires all aggregators to comply with this posting 
requirement, including aggregators in non-equal access areas. 
Responsibility for enforcement of the aggregator posting requirement 
is, in part, placed upon the OSP used by the aggregator. The OSP is 
obligated to ensure, by contract or tariff, that each aggregator for 
which such provider is the presubscribed provider of operator services 
is in compliance with the posting requirements.
    7. The Commission tentatively concludes that it should continue in 
the future to require some form of disclosure by CMRS aggregators 
similar to that prescribed by the Act. In particular, the Commission 
believes customers of CMRS aggregators will benefit from access to the 
same information that is available to direct customers of CMRS 
providers, including the identity of and how to contact the underlying 
service provider, how to obtain information about rates, and how to 
lodge complaints about service. For example, if certain aggregators are 
prone to frequently changing their underlying service provider, might 
it be costly for them to continuously update the disclosure 
information? The Commission also welcomes comment on the benefits of 
disclosure to consumers.
    8. The Commission therefore tentatively concludes that it should 
forbear from requiring CMRS aggregators to post disclosure information 
``on or near the telephone instrument,'' and instead should permit some 
or all CMRS aggregators to use some other reasonable means of 
disclosure. For example, the Commission might permit CMRS aggregators 
to provide the required information to the consumer at the point of 
establishing a contractual relationship, e.g., at the car rental 
counter or concierge desk. The Commission seeks comment regarding this 
tentative conclusion and how it should be implemented.
    9. The Commission also seeks comment on whether certain disclosures 
should be required of CMRS aggregators in addition to those mandated 
under section 226(c) of the Act and section 64.703(b) of the 
Commission's rules. Specifically, CMRS providers typically impose a 
number of charges on end users that are not commonly encountered in the 
wireline context, including roaming charges, charges for airtime, and 
charges for incoming calls. The Commission believes that CMRS 
subscribers are typically aware of these charges, but that transient 
users of CMRS may not be. The Commission therefore seeks comment on 
whether CMRS aggregators should be required to disclose the existence 
of these or other charges. If so, the Commission further seeks comment 
regarding the precise nature of the required disclosure. For example, 
should the aggregator provide information regarding the boundaries of 
the home calling area?
    10. Section 64.703(b)(3) of the Commission's rules requires that in 
the case of a pay telephone, an aggregator must disclose the local coin 
rate for the location. The Commission seeks comment on whether this 
requirement is appropriately applied to CMRS aggregators. Commenters 
should specifically address any relevant differences between CMRS and 
wireline coin-operated phones.
    11. The Commission also tentatively concludes that it should retain 
the requirement that CMRS OSPs ensure by contract or tariff that 
aggregators will comply with the disclosure requirements. PCIA argues, 
however, that compliance with the oversight requirement is problematic 
for CMRS OSPs because, unlike wireline OSPs, they typically do not have 
contracts with aggregators, and indeed may not know who aggregators of 
their services are. The Commission seeks comment regarding the 
prevalence of contractual arrangements between CMRS aggregators and 
OSPs, and how this compares with the wireline context. To the extent 
such contracts do not exist, the Commission seeks comment on the costs 
and benefits of requiring CMRS aggregators and OSPs to enter into 
contracts. The Commission also seeks comment on practical alternatives 
to contractual provisions as a means of effecting OSP oversight, and on 
whether OSPs that do not have contracts with their aggregators, or do 
not know who their aggregators are, should be exempt from the oversight 
requirement. In addition, the Commission welcomes comments on the 
benefits of oversight by CMRS OSPs.
    12. OSP Identification, Disclosure, and Termination at No Charge. 
TOCSIA requires that every OSP audibly and distinctly identify itself 
to every person who uses its operator services before any charge is 
incurred by the consumer, permit the consumer to terminate the 
telephone call at no charge before the call is connected, and disclose 
to the consumer upon request, at no charge, a quotation of its rates or 
charges for the call, the methods by which such rates or charges will 
be collected, and the methods by which complaints concerning such 
rates, charges, or collection practices will be resolved. Our 
regulations reiterate these requirements, and in addition the 
Commission requires that the OSP disclose audibly to the customer how 
to obtain the price of a call before the call is connected.
    13. The Commission seeks additional comments on PCIA's arguments in 
favor of forbearance. First, PCIA and commenters supporting its 
position argue that the OSP disclosure and call termination 
requirements are unnecessary to protect consumers because CMRS 
providers' rates and practices are reasonable, competitive market 
forces motivate CMRS providers to offer services at reasonable rates, 
and CMRS providers generally disclose rate information as a matter of 
sound business practice.
    14. The Commission also seeks comment on the disclosure practices 
of CMRS OSPs, and in particular whether they make relevant information 
available to consumers on each call and inform consumers before each 
call how to obtain such information. In addition, assuming providers 
typically do act reasonably and disclose their rates and practices, the 
Commission seeks comment on whether these circumstances are sufficient 
grounds for forbearing from regulation. The Commission also seeks 
comment on whether continuing to apply disclosure requirements to CMRS 
OSPs on each call is consistent with its decision in the Memorandum 
Opinion and Order to forbear from requiring these providers to file 
informational tariffs.
    15. Second, PCIA argues that enforcement of these requirements is 
not in the public interest because compliance with these requirements 
is unduly costly and burdensome for CMRS OSPs. The Commission seeks 
specific information regarding the costs of compliance for CMRS OSPs. 
To the extent that CMRS providers cannot distinguish calls made through 
aggregators from other calls, the

[[Page 43028]]

Commission further seeks information regarding the costs of making the 
required identification and disclosures on a larger universe of calls.
    16. Finally, PCIA argues that the OSP disclosure requirements are 
ill suited to CMRS operator services because, unlike in the wireline 
context, CMRS OSPs typically have no direct relationship with the end 
user and do not set the end user's rates. Rather, according to PCIA, 
the aggregator sets the customer's rates and bills the customer 
directly. The Commission seeks comment on the billing practices that 
prevail in CMRS aggregator contexts, and on the variations that may 
exist in these practices.
    17. Billing for Unanswered Calls. TOCSIA and the Commission's 
regulations forbid OSPs from billing for unanswered telephone calls in 
areas where equal access is available, and from knowingly billing for 
unanswered telephone calls in areas where equal access is not 
available. The Commission seeks comment about CMRS industry practices 
with respect to billing for unanswered calls and any variations in 
those practices. In particular, the Commission seeks information 
regarding what constitutes billable airtime and whether CMRS providers 
calculate airtime differently for customers who obtain service through 
aggregators than for other users of their networks. Commenters should 
further address the cost of implementing and complying with this 
provision for CMRS calls made through aggregators. To the extent that 
CMRS providers cannot distinguish between public and other users of the 
network, commenters should address the costs of forgoing billing for 
unanswered calls for a larger set of users.
    18. Call Splashing. Both TOCSIA and the implementing regulations 
forbid OSPs from engaging in ``call splashing'' or billing for a call 
that does not reflect the originating location of the call without the 
consumer's informed consent.
    19. The Commission seeks comment on the costs and benefits of 
applying the call splashing prohibition to CMRS. In particular, the 
Commission seeks comment on whether CMRS OSPs have any history of call 
splashing to the detriment of consumers, and on whether situations 
exist or could arise where CMRS OSPs could have an incentive to engage 
in call splashing that would harm consumers. In this regard, the 
Commission requests comment on the prevalence of distance-insensitive 
billing in CMRS markets, how this billing practice affects CMRS OSPs' 
incentives to engage in call splashing and the potential for call 
splashing to harm consumers, and how these conditions compare with the 
situation in wireline services. In addition, the Commission seeks 
information on the costs to CMRS OSPs of complying with the call 
splashing prohibition for calls made through aggregators and, to the 
extent that CMRS providers cannot distinguish between customers of 
aggregators and other users, the costs of complying with this 
prohibition on other calls as well.
    20. OSP Publication of Changes in Services. Under TOCSIA, the 
Commission is required to establish a policy for requiring providers of 
operator services to make public information about recent changes in 
operator services available to consumers. Pursuant to that directive, 
the Commission has required OSPs to regularly publish and make 
available at no cost to inquiring consumers written materials that 
describe any recent changes in operator services and in the choices 
available to consumers in that market. The Commission seeks comment on 
the costs and benefits of requiring CMRS OSPs to publish regular 
reports of their changes in service in light of the nature of the 
services provided, the level of abuses, and carriers' customary 
disclosure practices. The Commission is also interested in how this 
cost benefit analysis compares with the analysis for wireline OSPs. 
Commenters should particularly consider whether the benefit of these 
reports to consumers may vary for different CMRS aggregator 
arrangements, and therefore whether it may make sense to modify or 
forbear from enforcing the rule only for certain types of arrangements.
    21. Routing of Emergency Calls. TOCSIA requires the Commission to 
establish minimum standards for OSPs and aggregators to use in the 
routing of emergency telephone calls. Under Sec. 64.706 of the 
Commission's rules, which implements this provision, OSPs and 
aggregators are required to ensure immediate connection of emergency 
telephone calls to the appropriate emergency service of the reported 
location of the emergency, if known, and if not known, of the 
originating location of the call.
    22. The record, however, is almost totally devoid of comments 
addressing the emergency call routing obligation. The Commission seeks 
comment as to whether Sec. 64.706 is appropriately applied to CMRS 
aggregators and OSPs, in light of the Commission's E911 rules. 
Commenters should specifically address the costs and benefits of 
applying Sec. 64.706 in the CMRS context. In addition to addressing the 
impact of Sec. 20.18, commenters should consider whether Sec. 64.706 
remains necessary and appropriate as applied to any CMRS aggregators 
and OSPs that are not covered by the E911 rule, or whether those 
providers that are not covered by the E911 rule should be excluded from 
any emergency call routing obligation because they are incapable of 
handling emergency calls.

B. Forbearance From Other Statutory and Regulatory Provisions

    23. The Commission received numerous comments and reply comments on 
the Further Forbearance NPRM, 59 FR 25432 (May 16, 1994), but the 
passage of the Telecommunications Act of 1996 made sweeping changes 
which not only affected all consumers and telecommunications service 
providers, but also greatly expanded the Commission's forbearance 
authority. Section 332(c) authorizes the Commission to forbear from 
applying most provisions of Title II to any CMRS ``service or person.'' 
Under section 10, by contrast, the Commission may forbear from applying 
almost any regulation or provision of the Act to any 
``telecommunications carrier or telecommunications service, or class of 
telecommunications carriers or telecommunications services, in any or 
some of their geographic markets.'' The 1996 Act also added section 11, 
which directs the Commission biennially to review all of its 
telecommunications regulations and repeal or modify any regulations 
that the Commission determines are no longer necessary in the public 
interest as the result of meaningful economic competition between 
providers of service. Because these legal changes and changes in the 
telecommunications marketplace have made portions of the record in the 
Further Forbearance NPRM stale, the Commission terminates that 
proceeding and seeks new comments regarding forbearance from applying 
any regulation or provision of the Act to wireless telecommunications 
carriers licensed by the Commission. Such carriers include 
telecommunications carriers licensed under part 21 (domestic public 
fixed radio services), part 22 (public mobile radio services), part 24 
(personal communications services), part 90 (private land mobile radio 
services), and part 101 (fixed microwave services) of the Commission's 
rules.
    24. The Commission believes the goals identified in the CMRS Second 
Report and Order mirror those set for it by Congress in the 1996 Act: 
reduce the regulatory burden upon, and foster

[[Page 43029]]

vigorous and fair competition among, telecommunications providers. The 
Commission is continually striving to meet those goals. For example, 
the Commission's decision to forbear from applying tariffing 
requirements in sections 203, 204, and 205 to CMRS providers 
significantly reduced the filing burdens placed upon such providers. 
Continuing this trend, the Commission recently eliminated in most 
circumstances the requirement that telecommunications carriers licensed 
by the Wireless Telecommunications Bureau obtain prior Commission 
approval before consummating pro forma transactions.
    25. Section 332(c) and section 10 differ in scope, yet set forth 
similar three-pronged tests that must be met in order for the 
Commission to exercise forbearance authority. Since the Further 
Forbearance NPRM was issued prior to the passage of section 10, the 
Commission seeks comment as to whether the differences in language 
between section 332(c) and section 10 necessitate a departure from the 
criteria the Commission enunciated in the Further Forbearance NPRM as a 
test for whether it would use its authority to forbear. The Commission 
further asks, since its authority under section 332(c) was limited to 
deregulation of commercial mobile services, whether it should extend 
any forbearance pursuant to section 10 to wireless carriers other than 
those classified as CMRS, e.g., wireless competitive local exchange 
carriers (CLECs), in order to promote their role in providing 
competition in the local exchange market.
    26. If commenters seek forbearance from particular statutory 
provisions or regulations, the Commission asks them to primarily focus 
their analysis on whether forbearance is warranted under the three-
pronged test of either section 332 or section 10. In connection with 
the third prong of the test, the public interest standard, commenters 
should show whether the costs incurred by carriers to comply with 
particular provisions outweigh the benefits to the public to be gained 
in applying them, as well as whether forbearance from particular 
statutory provisions would enhance future competition from a diversity 
of entities and thus tend to justify a finding that forbearance served 
the public interest.
    27. The Commission also seeks comment on whether there exist, 
within CMRS and other wireless telecommunications markets, types of 
providers for which application of a particular statutory or regulatory 
provision will either pose undue costs or yield no benefits to the 
public. For example, if the costs of regulation are fixed, smaller 
providers could be more likely than other types of providers to be 
burdened by the costs of regulation. The Commission believes two 
factors of the public interest test that it has proposed to apply under 
section 332(c) can serve to guide its determinations in this area. The 
first is whether differential costs of compliance with particular laws 
or regulations make forbearance appropriate for particular types of 
providers. The second is whether the public interest benefits from 
application of particular provisions vary among the different types of 
providers.
    28. In addition, the Commission asks interested parties to comment 
on how forbearance for particular types of providers would comport with 
the goal of regulatory symmetry, bearing in mind that the Commission's 
forbearance authority permits different regulation of different 
providers.
    29. Finally, the Commission asks interested parties to suggest any 
other factors or alternatives that it should consider when evaluating 
forbearance petitions affecting telecommunications services or 
providers licensed or regulated by the Wireless Telecommunications 
Bureau.

Paperwork Reduction Act

    30. The proposals contained herein do not contain any information 
collections requiring approval by the Office of Management and Budget. 
The Commission seeks comments regarding whether, and in what respects, 
it should forbear from applying already established rules.

Initial Regulatory Flexibility Analysis

    31. As required by the Regulatory Flexibility Act (RFA), the 
Commission has prepared this Initial Regulatory Flexibility Analysis 
(IRFA) of the possible impact on small entities of the rules proposed 
in the NPRM (Notice) in WT Docket No. 98-100. Written public comments 
are requested on the IRFA. Comments on the IRFA must have a separate 
and distinct heading designating them as responses to the IRFA and must 
be filed by the deadlines for comments on the Notice. The Commission 
will send a copy of the Notice, including this IRFA, to the Chief 
Counsel for Advocacy of the Small Business Administration.

A. Need for, and Objectives of, the Proposed Rules

    32. In this NPRM, the Commission proposes to consider forbearing 
from applying provisions of section 226 of the Communications Act 
(Telephone Operator Consumer Services Improvement Act or TOCSIA) to 
Commercial Mobile Radio Service (CMRS) providers and aggregators of 
CMRS, as well as modifying its rules applying TOCSIA to those entities. 
Specifically, the Commission proposes to: (1) continue to require some 
form of disclosure to consumers by CMRS aggregators similar to that 
mandated by section 226(b)(1)(D) of the Act, although the precise 
nature of the disclosure may be modified; (2) forbear from requiring 
CMRS aggregators to post disclosure information ``on or near the 
telephone instrument,'' and instead permit all or some CMRS aggregators 
to use some other reasonable means of disclosure; and (3) continue to 
require CMRS providers of operator service (OSPs) to ensure by contract 
or tariff that aggregators will comply with the disclosure 
requirements.
    33. In addition, the Commission requests comment on whether it 
should forbear from applying other provisions of TOCSIA in the CMRS 
context or whether these requirements should be modified as applied to 
CMRS aggregators and OSPs. The Commission's objective is to formulate 
rules that are responsive to the differences between CMRS and fixed 
services provided through aggregators, that avoid imposing unnecessary 
burdens on CMRS OSPs and aggregators, and that provide consumers who 
obtain CMRS through aggregators with protections comparable to those 
enjoyed by other consumers of CMRS.
    34. The Notice also seeks comment on forbearance from applying 
other provisions of the Act to all wireless telecommunications carriers 
licensed by the Commission, including telecommunications carriers 
licensed under part 21 (domestic public fixed radio services), part 22 
(public mobile radio services), part 24 (personal communications 
services), part 90 (private land mobile radio services), and part 101 
(fixed microwave services) of our rules. The Commission's objective is 
to reduce regulatory burdens upon providers of wireless 
telecommunications services where consistent with the public interest, 
and thus to foster vigorous and fair competition among these providers.

B. Legal Basis

    35. The proposed action is authorized under sections 1, 4(i), 10, 
11 and 332(c) of the Communications Act of 1934, as amended, 47 U.S.C. 
Secs. 151, 154(i), 160, 161 and 332(c).

[[Page 43030]]

C. Description and Estimate of the Number of Small Entities to Which 
Rules Will Apply

    36. The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that will be 
affected by our rules. The RFA generally defines the term ``small 
entity'' as having the same meaning as the terms ``small business,'' 
``small organization,'' and ``small governmental jurisdiction.'' A 
small organization is generally ``any not-for-profit enterprise which 
is independently owned and operated and is not dominant in its field.'' 
Nationwide, there are 275,801 small organizations. ``Small governmental 
jurisdiction'' generally means ``governments of cities, counties, 
towns, townships, villages, school districts, or special districts, 
with a population of less than 50,000.'' As of 1992, there were 85,006 
such jurisdictions in the United States.
    37. In addition, the term ``small business'' has the same meaning 
as the term ``small business concern'' under Section 3 of the Small 
Business Act. Under the Small Business Act, a ``small business 
concern'' is one which: (1) is independently owned and operated; (2) is 
not dominant in its field of operation; and (3) meets any additional 
criteria established by the Small Business Administration (SBA).
    38. The Notice could result in rule changes that, if adopted, would 
affect all small businesses that are aggregators or providers of CMRS 
operator services as well as all small business that are wireless 
telecommunications carriers. To assist the Commission in analyzing the 
total number of affected small entities, commenters are requested to 
provide estimates of the number of small entities that may be affected 
by any rule changes resulting from the Notice. The Commission estimates 
the following number of small entities may be affected by the proposed 
rule changes:
    39. Cellular Radiotelephone Service. The Commission has not 
developed a definition of small entities applicable to cellular 
licensees. Therefore, the applicable definition of small entity is the 
definition under the SBA rules applicable to radiotelephone companies. 
This definition provides that a small entity is a radiotelephone 
company employing no more than 1,500 persons. The size data provided by 
the SBA does not enable us to make a meaningful estimate of the number 
of cellular providers which are small entities because it combines all 
radiotelephone companies with 1,000 or more employees. The 1992 Census 
of Transportation, Communications, and Utilities, conducted by the 
Bureau of the Census, is the most recent information available. This 
document shows that only twelve radiotelephone firms out of a total of 
1,178 such firms which operated during 1992 had 1,000 or more 
employees. Therefore, even if all twelve of these firms were cellular 
telephone companies, nearly all cellular carriers were small businesses 
under the SBA's definition. The Commission assumes, for purposes of 
this IRFA, that all of the current cellular licensees are small 
entities, as that term is defined by the SBA. In addition, the 
Commission notes that there are 1,758 cellular licenses; however, a 
cellular licensee may own several licenses. The most reliable source of 
information regarding the number of cellular service providers 
nationwide appears to be data the Commission publishes annually in its 
Telecommunications Industry Revenue report, regarding the 
Telecommunications Relay Service (TRS). The report places cellular 
licensees and Personal Communications Service (PCS) licensees in one 
group. According to the data released in November 1997, there are 804 
companies reporting that they engage in cellular or PCS service. It 
seems certain that some of these carriers are not independently owned 
and operated, or have more than 1,500 employees; however, the 
Commission is unable at this time to estimate with greater precision 
the number of cellular service carriers qualifying as small business 
concerns under the SBA's definition. For purposes of this IRFA, the 
Commission estimates that there are fewer than 804 small cellular 
service carriers.
    40. Broadband PCS. The broadband PCS spectrum is divided into six 
frequency blocks designated A through F. The Commission has defined 
``small entity'' in the auctions for Blocks C and F as a firm that had 
average gross revenues of less than $40 million in the three previous 
calendar years. This definition of ``small entity'' in the context of 
broadband PCS auctions has been approved by the SBA. The Commission has 
auctioned broadband PCS licenses in blocks A through F. Of the 
qualified bidders in the C and F block auctions, all were 
entrepreneurs. Entrepreneurs was defined for these auctions as 
entities, together with affiliates, having gross revenues of less than 
$125 million and total assets of less than $500 million at the time the 
FCC Form 175 application was filed. Ninety bidders, including C block 
auction winners, won 493 C block licenses and 88 bidders won 491 F 
block licenses. For purposes of this IRFA, the Commission assumes that 
all of the 90 C block broadband PCS licensees and 88 F block broadband 
PCS licensees, a total of 178 licensees, are small entities.
    41. Narrowband PCS. The Commission has auctioned nationwide and 
regional licenses for narrowband PCS. There are 11 nationwide and 30 
regional licensees for narrowband PCS. The Commission does not have 
sufficient information to determine whether any of these licensees are 
small businesses within the SBA-approved definition for radiotelephone 
companies. At present, there have been no auctions held for the major 
trading area (MTA) and basic trading area (BTA) narrowband PCS 
licenses. The Commission anticipates a total of 561 MTA licenses and 
2,958 BTA licenses will be awarded in the auctions. Given that nearly 
all radiotelephone companies have no more than 1,500 employees, and 
that no reliable estimate of the number of prospective MTA and BTA 
narrowband licensees can be made, the Commission assumes, for purposes 
of this IRFA, that all of the licenses will be awarded to small 
entities, as that term is defined by the SBA.
    42. 220 MHz Radio Services. Commercial licenses in the 220-222 MHz 
band are divided into two categories. Phase I licensees are licensees 
granted initial authorizations from among applications filed on or 
before May 24, 1991. The Commission has not adopted a definition of 
small business specific to Phase I 220 MHz licensees. Accordingly, the 
Commission will use the SBA definition applicable to radiotelephone 
companies, i.e., an entity employing no more than 1,500 persons. 
Approximately 1,515 non-nationwide Phase I licenses and four nationwide 
Phase I licenses have been awarded. The Commission estimates that 
almost all of the holders of these licenses are small entities under 
the SBA definition.
    43. Phase II licensees are licensees granted initial authorizations 
from among applications filed after May 24, 1991. The Commission has 
adopted a two-tiered definition of small businesses in the context of 
auctioning Phase II licenses in the 220-222 MHz band. A small business 
is defined as either (1) an entity that, together with its affiliates 
and controlling principals, has average gross revenue for the three 
preceding years of not more than $3 million; or (2) an entity that, 
together with affiliates and controlling principals, has average gross 
revenue for the three preceding years of not more than $15 million. 
This definition of small business has been

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approved by the SBA. There have not been any auctions to date of 220 
MHz licenses, and it is therefore impossible accurately to predict how 
many eventual licensees out of the auctions process will be small 
entities. Based on its experience with auctions of SMR licenses in the 
900 MHz band, however, the Commission estimates that for the 908 
auctionable licenses in the 220 MHz band, there will be approximately 
120 applicants, of which approximately 92 will be small entities within 
either prong of the definition approved by the SBA.
    44. Paging. The Commission has proposed a two-tier definition of 
small businesses in the context of auctioning geographic area paging 
licenses in the Common Carrier Paging and exclusive Private Carrier 
Paging services. Under the proposal, a small business will be defined 
as either (1) an entity that, together with its affiliates and 
controlling principals, has average gross revenues for the three 
preceding years of not more than $3 million; or (2) an entity that, 
together with affiliates and controlling principals, has average gross 
revenues for the three preceding calendar years of not more than $15 
million. Since the SBA has not yet approved this definition for paging 
services, the Commission will utilize the SBA definition applicable to 
radiotelephone companies, i.e., an entity employing no more than 1,500 
persons. At present, there are approximately 24,000 Private Paging 
licenses and 74,000 Common Carrier Paging licenses.
    45. Air-Ground Radiotelephone Service. The Commission has not 
adopted a definition of small business specific to the Air-Ground 
Radiotelephone Service. Accordingly, the Commission will use the SBA 
definition applicable to radiotelephone companies, i.e., an entity 
employing no more than 1,500 persons. There are approximately 100 
licensees in the Air-Ground Radiotelephone Service, and the Commission 
estimates that almost all of them qualify as small entities under the 
SBA definition.
    46. Specialized Mobile Radio (SMR). The Commission awards bidding 
credits in auctions for geographic area 800 MHz and 900 MHz SMR 
licenses to firms that had revenues of no more than $15 million in each 
of the three previous calendar years. This regulation defining ``small 
entity'' in the context of 800 MHz and 900 MHz SMR has been approved by 
the SBA. The Commission does not know how many firms provide 800 MHz or 
900 MHz geographic area SMR service pursuant to extended implementation 
authorizations, nor how many of these providers have annual revenues of 
no more than $15 million. One firm has over $15 million in revenues. 
The Commission assumes for purposes of this IRFA that all of the 
remaining existing extended implementation authorizations are held by 
small entities, as that term is defined by the SBA. The Commission has 
held auctions for geographic area licenses in the 900 MHz SMR band, and 
recently completed an auction for geographic area 800 MHz SMR licenses. 
There were 60 winning bidders who qualified as small entities in the 
900 MHz auction. There were 10 winning bidders who qualified as small 
entities in the 800 MHz auction.
    47. Offshore Radiotelephone Service. This service operates on 
several ultra high frequency (UHF) TV broadcast channels that are not 
used for TV broadcasting in the coastal area of the states bordering 
the Gulf of Mexico. At present, there are approximately 55 licensees in 
this service. The Commission is unable at this time to estimate the 
number of licensees that would qualify as small entities under the SBA 
definition for radiotelephone communications. The Commission assumes, 
for purposes of this IRFA, that all of the 55 licensees are small 
entities, as that term is defined by the SBA.
    48. General Wireless Communications Service. This service was 
created by the Commission on July 31, 1995 by transferring 25 MHz of 
spectrum in the 4660-4685 MHz band from the federal government to 
private sector use. The Commission is unable at this time to estimate 
the number of licensees that would qualify as small entities under the 
SBA definition for radiotelephone communications.
    49. Common Carrier Fixed Microwave Services. Microwave services 
include common carrier fixed, private operational-fixed, and broadcast 
auxiliary radio services. Of these, only operators in the common 
carrier fixed microwave service are telecommunications carriers that 
could be affected by the adoption of rules pursuant to this Notice. At 
present, there are 22,015 common carrier fixed microwave licensees. The 
Commission has not yet defined a small business with respect to 
microwave services. For purposes of this IRFA, the Commission will 
utilize the SBA definition applicable to radiotelephone companies, 
i.e., an entity employing no more than 1,500 persons. The Commission 
estimates that for purposes of this IRFA all of the common carrier 
fixed microwave licensees would qualify as small entities under the SBA 
definition for radiotelephone communications.
    50. Rural Radiotelephone Service. The Commission has not adopted a 
definition of small entity specific to the Rural Radiotelephone 
Service. A significant subset of the Rural Radiotelephone Service is 
the Basic Exchange Telephone Radio Systems (BETRS). The Commission will 
use the SBA definition applicable to radiotelephone companies; i.e., an 
entity employing no more than 1,500 persons. There are approximately 
1,000 licensees in the Rural Radiotelephone Service, and the Commission 
estimates that almost all of them qualify as small entities under the 
SBA definition.
    51. Marine Coast Service. The Commission has not adopted a 
definition of small business specific to the marine coast service. The 
Commission will use the SBA definition applicable to radiotelephone 
companies; i.e., an entity employing no more than 1,500 persons. There 
are approximately 10,500 licensees in the marine coast service, and the 
Commission estimates that almost all of them qualify as small under the 
SBA definition.
    52. Wireless Communications Services (WCS). WCS is a wireless 
service which can be used for fixed, mobile, radiolocation, and digital 
audio broadcasting satellite uses. The Commission will use the SBA 
definition applicable to radiotelephone companies, i.e., an entity 
employing no more than 1,500 persons, while it seeks SBA approval of a 
more refined definition. The Commission auctioned geographic area 
licenses in the WCS service. Based upon the information obtained in the 
auctions process, the Commission concludes that eight WCS licensees are 
small entities.
    53. In addition to the above estimates, new licensees in the 
wireless radio services will be affected by these rules, if adopted. 
CMRS aggregators will also be affected by these rules, if adopted. The 
Commission does not have any basis for estimating the number of CMRS 
aggregators that may be small entities. To assist the Commission in 
analyzing the numbers of potentially affected small entities, 
commenters are requested to provide information regarding how many 
small business entities may be affected by the proposed rules.

D. Description of Reporting, Record Keeping and Other Compliance 
Requirements

    54. The Notice proposes no additional reporting, recordkeeping or 
other compliance measures and seeks to minimize such burdens for CMRS 
aggregators and OSPs. As noted, the Commission proposes to forbear from

[[Page 43032]]

requiring CMRS aggregators to post disclosure information ``on or near 
the telephone instrument,'' and instead permit all or some CMRS 
aggregators to use some other reasonable means of disclosure.

E. Steps Taken to Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    55. The NPRM proposes to reduce the administrative burdens and cost 
of compliance with TOCSIA and the Commission's implementing regulations 
for CMRS aggregators and OSPs generally. This reduction of burden will 
economically benefit small entities within these categories. In 
addition, the Commission seeks comment on ways of reducing regulatory 
burdens by forbearing from applying any provisions of the 
Communications Act to wireless telecommunications carriers, including 
those carriers that are small business entities. The Commission 
specifically requests comment on whether forbearance from applying any 
statutory provision is appropriate with respect to smaller CMRS 
providers.

F. Federal Rules Which Overlap, Duplicate, or Conflict With These 
Proposed Rules

    56. None.

V. Ordering Clauses

    57. It Is Ordered that, pursuant to sections 1, 4(i), 10, 11, 
303(g), 303(r) and 332 of the Communications Act of 1934, as amended, 
47 U.S.C. 151, 154(i), 160, 161, 303(g), 303(r) and 332, a Notice of 
Proposed Rulemaking is hereby adopted.
    58. It Is Further Ordered that, pursuant to applicable procedures 
set forth in Secs. 1.415 and 1.419 of the Commission's Rules, 47 CFR 
1.415 and 1.419, interested parties may file comments on the Notice of 
Proposed Rulemaking on or before August 3, 1998, and reply comments on 
or before August 18, 1998. Comments and reply comments should be filed 
in WT Docket No. 98-100. To file formally in this proceeding, you must 
file an original plus four copies of all comments, reply comments, and 
supporting comments. For each Commissioner to receive a personal copy 
of your comments, you must file an original plus nine copies. Send 
comments and reply comments to Office of the Secretary, Federal 
Communications Commission, Washington D.C. 20554. Comments and reply 
comments will be available for public inspection during regular 
business hours in the FCC Reference Center (Room 239), 1919 M Street, 
N.W., Washington, D.C. For further information contact Jeffrey 
Steinberg at 202-418-0620 or Kimberly Parker at 202-418-7240.
    59. This is a permit-but-disclose notice and comment rulemaking 
proceeding. Ex parte presentations are permitted except during the 
Sunshine Agenda period, provided they are disclosed as provided in the 
Commission's rules. See generally 47 CFR 1.1202, 1.203, and 1.206(a).
    60. As required by Section 603 of the Regulatory Flexibility Act, 5 
U.S.C. Sec. 603, the Commission has prepared an Initial Regulatory 
Flexibility Analysis (IRFA) of the expected impact on small entities of 
the proposals suggested in this document. The IRFA is set forth herein. 
Written public comments are requested on the IRFA. These comments must 
be filed in accordance with the same filing deadlines as comments on 
the rest of the NPRM, but they must have a separate and distinct 
heading designating them as responses to the Initial Regulatory 
Flexibility Analysis. The Commission's Office of Public Affairs, 
Reference Operations Division, shall send a copy of this NPRM, 
including the Initial Regulatory Flexibility Analysis, to the Chief 
Counsel for Advocacy of the Small Business Administration.

List of Subjects

47 CFR Part 20

    Communications common carriers, Communications equipment.

47 CFR Part 64

    Communications common carriers, Telephone.

Federal Communications Commission,
Magalie Roman Salas,
Secretary.
[FR Doc. 98-21258 Filed 8-10-98; 8:45 am]
BILLING CODE 6712-01-P