[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]]
_______________________________________________________________________
Part V
Federal Communications Commission
_______________________________________________________________________
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.
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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
[[Page 43031]]
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