[Federal Register Volume 67, Number 122 (Tuesday, June 25, 2002)]
[Rules and Regulations]
[Pages 42730-42735]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-15951]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 2 and 15

[ET Docket 99-231; FCC 02-151]


Spread Spectrum Devices

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document amends the Commission's rules to improve 
spectrum sharing by unlicensed devices operating in the 2.4 GHz band 
(2400-2483.5 MHz), to provide for introduction of new digital 
transmission technologies, and eliminate unnecessary regulations for 
spread spectrum systems.

DATES: Effective July 25, 2002.

FOR FURTHER INFORMATION CONTACT: Neal McNeil, Office of Engineering and 
Technology, (202) 418-2408, TTY (202) 418-2989, e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second 
Report and Order, ET Docket 99-231, FCC 02-151, adopted May 16, 2002 
and released May 30, 2002. The full text of this document is available 
for inspection and copying during regular business hours in the FCC 
Reference Center (Room CY-A257), 445 12th Street, SW., Washington, DC 
20554. It is also available on the Commission's internet site at 
www.fcc.gov. The complete text of this document also may be purchased 
from the Commission's duplication contractor Qualex International, 
(202) 863-2893 voice, (202) 863-2898 Fax, [email protected] email, 
Portals II, 445 12th Street, SW, Room CY-B402, Washington, DC 20554.

Summary of Second Report and Order

    1. Digital Systems. In the Further Notice of Proposed Rule Making 
(``FNPRM'') 66 FR 31585, June 12, 2001, in this proceeding, we observed 
that a number of new digital modulation technologies have been 
developed that have spectrum characteristics similar to direct sequence 
spread spectrum systems. The digital systems spread their transmitted 
energy across a wide bandwidth, thereby minimizing the amount of energy 
transmitted in any one portion of the occupied frequency band. 
Therefore, such digital modulation systems may exhibit no more 
potential to cause interference to other devices than direct sequence 
systems. However, because digital modulation systems do not meet the 
Commission's definition of a spread spectrum system, they have not been 
allowed to operate under Sec. 15.247. In the FNPRM, we proposed to 
amend Sec. 15.247 to provide for use of these new digital technologies 
in the 915 MHz, 2.4 GHz, and 5.7 GHz bands. We invited comment on 
whether these technologies should be allowed to operate at the same 
power levels as direct sequence spread spectrum systems, specifically 1 
Watt maximum output power with a maximum power spectral density of 8 
dBm per 3 kHz.
    2. Based on analysis of the record, we conclude that systems using 
digital modulation techniques can operate under the same rules as 
direct sequence spread spectrum devices in the 915 MHz, 2.4 GHz, and 
5.7 GHz band without posing additional risk of interference. Therefore, 
we will remove any regulatory distinction between direct sequence 
spread spectrum systems and systems using other forms of digital 
modulation. We amend part 15 to replace references to ``direct sequence 
spread spectrum'' with the term ``digital modulation'' and permit all 
types of digitally modulated systems to be regulated under Sec. 15.247. 
``Digital modulation'' in the context of 47 CFR 15.247 will have the 
same meaning as defined in 47 CFR 15.403(b). This change will permit 
the authorization of newly developing high data rate technologies. 
Under the new rules, digital modulation systems will be subject to the 
same power output maximum, 1 Watt, and power spectral density limits, 8 
dBm per 3 kHz, as direct sequence spread spectrum systems.
    3. Processing Gain. The rules currently require direct sequence 
spread spectrum devices to have a processing gain of at least 10 dB. 
Processing gain represents the improvement to the received signal-to-
noise ratio, after

[[Page 42731]]

filtering to the information bandwidth, from the spreading/dispreading 
function. The processing gain is also a measure of a direct sequence 
systems ability to withstand interference. In the FNPRM we stated that 
as the spread spectrum industry has matured, it is not clear that the 
processing gain requirement continues to be necessary. Manufacturers 
have an incentive to design their systems to include processing gain in 
order for their device to operate properly when located near other 
radio frequency devices. We further noted that it has become 
increasingly difficult to determine true processing gain of certain 
direct sequence spread spectrum systems due in part to a diversity of 
opinion within the industry as to the definition of processing gain for 
these systems and the proper way to measure it. We also noted that 
uncertainties about the processing gain requirement can be a 
significant impediment to the introduction of new technologies. In 
light of these factors, the FNPRM proposed to eliminate the processing 
gain requirement for direct sequence spread spectrum systems.
    4. Consistent with our decision to allow operation of digital 
modulation systems with spectrum characteristics similar to those of 
spread spectrum systems, we find that it is no longer desirable to 
maintain the processing gain requirement for direct sequence systems. 
The processing gain requirement was incorporated into the rules to 
ensure that systems taking advantage of the higher power levels 
afforded spread spectrum systems were indeed direct sequence spread 
spectrum systems and therefore have some tolerance to interference. We 
believe that manufacturers have a market-driven incentive to design 
their systems with the ability to operate properly when located near 
other radio frequency devices.
    5. Frequency Hopping Spread Spectrum Systems. We will allow 
frequency hopping spread spectrum systems to use as few as fifteen 
hopping channels with bandwidths up to 5 MHz and no minimum band 
occupancy requirements, provided output power is reduced to 125 mW. 
This modification of our regulations for frequency hopping systems will 
provide greater flexibility without significantly increasing the risk 
of interference to other users. In the First Report and Order, 66 FR 
57557, September 25, 2000, in this proceeding, we determined that 
frequency hopping systems with bandwidths between 1 MHz and 5 MHz may 
operate in the 2.4 GHz band with a minimum of 15 hopping channels and 
125 mW output power with minimal interference potential. Nothing in the 
record of this proceeding demonstrates that frequency hopping systems 
with bandwidths of 1 MHz or less cannot also operate effectively with a 
minimum of fifteen hopping channels with a similar power reduction. The 
reduction of maximum peak power from 1 Watt to 125 mW will offset any 
increased potential for interference caused by use of the reduced 
hopset, regardless of channel bandwidth. We find it unnecessary to 
require frequency hopping systems to occupy a minimum percentage of the 
2.4 GHz band. Our primary concern for the operation of devices in the 
2.4 GHz band is interference avoidance. Although a minimum bandwidth 
occupancy requirement may, in some cases, reduce the interference 
potential of frequency hopping systems, it is not the only method by 
which the systems can efficiently share the band. Indeed, such a 
requirement may actually negate the possibility for system designers to 
implement more efficient spectrum sharing techniques as they see fit. 
The simple, unambiguous rules we are adopting in this Second Report and 
Order will allow manufacturers the freedom to design an array of 
frequency hopping systems that effectively share the 2.4 GHz band.
    6. We will not require frequency hopping systems that use a reduced 
hopset to employ adaptive hopping techniques. The power reduction we 
are adopting for these devices is sufficient to mitigate any possible 
increase in interference potential due to the smaller number of hopping 
channels. Furthermore, operation pursuant to the modified rules will 
not pose a greater interference threat than systems authorized under 
our former rules. We note that Sec. 15.247(h) of the rules permits the 
use of intelligent or adaptive hopping techniques in order to avoid 
transmitting on occupied frequencies. We believe that Sec. 15.247(h) 
provides sufficient flexibility for manufacturers to design products 
which incorporate adaptive hopping in circumstances where it would be 
beneficial. The amended rules would permit manufacturers to build 
products that include adaptive techniques such as a product that 
includes both a digital and a frequency hopping transmitter, where the 
frequency hopping transmitter avoids or suppresses its transmissions 
when the digital transmitter is operating.

Final Regulatory Flexibility Analysis

    7. As required by the Regulatory Flexibility Act (``RFA''),\1\ an 
Initial Regulatory Flexibility Analysis (``IRFA'') was incorporated in 
the Further Notice of Proposed Rule Making (``FNPRM'') in this 
proceeding, ET Docket 99-231.\2\ The Commission sought written public 
comment on the proposals in the FNPRM, including comment on the IRFA. 
As described more fully below, we find that the rules we adopt in the 
Second Report and Order will not have a significant economic impact on 
a substantial number of small entities.\3\ We have nonetheless provided 
this Final Regulatory Flexibility Analysis (``FRFA'') to provide a 
fuller record in this proceeding. This FRFA conforms to the RFA.\4\
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    \1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601-612, has been 
amended by the Small Business Regulatory Enforcement Fairness Act of 
1996 (SBREFA), Public Law 104-121, Title II, 110 Stat. 857 (1996).
    \2\ See ET Docket 99-231, FCC 01-158, 66 FR 31585, June 12, 
2001.
    \3\ Thus, we could certify that an analysis is not required. See 
5 U.S.C. 605(b).
    \4\ See 5 U.S.C. 604.
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A. Need for and Objective of the Rules

    8. The Commission's spread spectrum rules have been a tremendous 
success. A wide variety of devices have been introduced under these 
rules for business and consumer use including cordless telephones and 
computer local area networks. Moreover, the past few years have 
witnessed the development of industry standards, such as IEEE 802.11b, 
Bluetooth, and Home RF, that promise to greatly expand the number and 
variety of devices that will operate in the 2.4 GHz band. We anticipate 
the introduction of wireless headsets and computer connections for 
cellular and PCS phones, wireless computer peripherals such as printers 
and keyboards, and a host of new wireless Internet appliances that will 
use this band.
    9. The rules adopted in the Second Report and Order provide for the 
introduction of new digital transmission technologies, eliminate 
unnecessary regulations for spread spectrum systems, and improve 
spectrum sharing by unlicensed devices operating in the 915 MHz (902-
928 MHz), 2.4 GHz (2400-2483.5 MHz), and 5.7 GHz (5725-5850 MHz) bands. 
Specifically, the Second Report and Order revises Sec. 15.247 of the 
Commission's rules to allow new digital transmission technologies and 
direct sequence spread spectrum systems to operate under the same rules 
in the 915 MHz, 2.4 GHz,

[[Page 42732]]

and 5.7 GHz bands.\5\ We also remove the requirement that direct 
sequence spread spectrum systems must demonstrate at least 10 dB of 
processing gain. Finally, the Second Report and Order modifies the 
rules for frequency hopping spread spectrum systems operating in the 
2.4 GHz band to reduce the amount of spectrum that must be used with 
certain types of operation. We take these actions to facilitate the 
continued development and deployment of new wireless devices for 
businesses and consumers.
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    \5\ 47 CFR 15.247.
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B. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    10. Only the Information Technology Industry Council (``ITI'') 
filed comments in response to the IRFA.\6\ ITI supports the 
Commission's proposal. They state that the proposals contained in the 
FNPRM will significantly improve sharing of the spectrum by wireless 
devices operating in the 2.4 GHz band.
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    \6\ See Information Technology Industry Council comments.
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    11. ITI supports the proposal to modify Sec. 15.247 of the 
Commission's rules governing frequency hopping spread spectrum devices 
in the 2.4 GHz band to allow as few as fifteen hopping channels. 
However, ITI requests that the Commission consider further 
modifications to permit even fewer than fifteen channels. It states 
that wireless devices using less than fifteen channels can be designed 
not to interfere with other equipment. It further states that adopting 
a minimum limit of hopping channels is contrary to the Commission's 
intent to improve flexibility for manufacturers an does not contribute 
to additional clarifying rulemakings.
    12. ITI also supports the Commission's other proposals. 
Specifically, ITI urges the Commission to modify its rules to 
accommodate new digital modulation systems in the 915 MHz, 2.4 GHz, and 
5.7 GHz bands. It states that the changes will provide manufacturers 
with flexibility to design non-interfering products for these bands 
without the need for frequent rule changes to address each new 
technology. Finally, ITI supports the proposal to remove the 
requirement that direct sequence spread spectrum systems must 
demonstrate at least 10 dB of processing gain. It states that the 
requirement is no longer necessary since manufacturers have an 
incentive to include processing gains to ensure that their devices 
operate properly when located near other radio frequency devices.

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

    13. The RFA directs agencies to provide a description of, and, 
where feasible, an estimate of the number of small entities that may be 
affected by the rules adopted.\7\ The RFA generally defines the term 
``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdictions.''\8\ In addition, the term ``small business'' has the 
same meaning as the term ``small business concern'' under the Small 
Business Act.\9\ A ``small business concern'' is one that: (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'').\10\
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    \7\ 5 U.S.C. 604(a)(3).
    \8\ 5 U.S.C. 601(6).
    \9\ 5 U.S.C. 601(3) (incorporating by reference the definition 
of ``small-business concern'' in the Small Business Act, 15 U.S.C. 
632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a 
small business applies ``unless an agency, after consultation with 
the Office of Advocacy of the Small Business Administration and 
after opportunity for public comment, establishes one or more 
definitions of such term which are appropriate to the activities of 
the agency and publishes such definition(s) in the Federal 
Register.''
    \10\ 15 U.S.C. 632.
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    14. The Commission has not developed a definition of small entities 
specifically directed toward manufacturers of unlicensed communications 
devices. Therefore, we will utilize the SBA definition applicable to 
manufacturers of Radio and Television Broadcasting and Communications 
Equipment. According to the SBA regulations, unlicensed transmitter 
manufacturers must have 750 or fewer employees in order to qualify as a 
small business concern.\11\ Census Bureau data indicates that there are 
858 U.S. companies that manufacture radio and television broadcasting 
and communications equipment, and that 778 of these firms have fewer 
than 750 employees and would be classified as small entities.\12\ This 
action will not have a negative impact on small entities that 
manufacture unlicensed spread spectrum devices.
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    \11\ See 13 CFR 121.201, (NAICS) Code 334220.
    \12\ See U.S. Dept. of Commerce, 1992 Census of Transportation, 
Communications and Utilities (issued May 1995), NAICS Code 334220.
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    15. According to SBA regulations, an electronic computer 
manufacturer must have 1,000 or fewer employees in order to qualify as 
a small entity.\13\ Census Bureau data indicates that there are 716 
firms that manufacture electronic computers. Of those, 659 have fewer 
than 500 employees and qualify as small entities.\14\ The remaining 57 
firms have 500 or more employees; however, we unable to determine how 
many of those have 1,000 or fewer employees and therefore also qualify 
as small entities under the SBA definition.
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    \13\ 13 CFR 121.201, NAICS Code 334111.
    \14\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, NAICS Code 334111. (Bureau 
of the Census data adapted by the Office of Advocacy of the U.S. 
Small Business Administration).
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    16. According to SBA regulations, a computer terminal manufacturer 
must have 1,000 or fewer employees in order to qualify as a small 
entity.\15\ Census Bureau data indicates that there are 757 firms that 
manufacture computer terminals. Of those, 162 have fewer than 500 
employees and qualify as small entities.\16\ The remaining 11 firms 
have 500 or more employees; however, we unable to determine how many of 
those have 1,000 or fewer employees and therefore also qualify as small 
entities under the SBA definition.
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    \15\ 13 CFR 121.201, NAICS Code 334111.
    \16\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, NAICS Code 334111. (Bureau 
of the Census data adapted by the Office of Advocacy of the U.S. 
Small Business Administration).
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    17. According to SBA regulations, a computer peripheral equipment 
manufacturer must have 1,000 or fewer employees in order to qualify as 
a small entity.\17\ Census Bureau data indicates that there are 757 
firms that manufacture computer terminal equipment. Of those, 701 have 
fewer than 500 employees and qualify as small entities.\18\ The 
remaining 56 firms have 500 or more employees; however, we unable to 
determine how many of those have 1,000 or fewer employees and therefore 
also qualify as small entities under the SBA definition.
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    \17\ 13 CFR 121.201, NAIC Code 334119.
    \18\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, NAICS Code 334119. (Bureau 
of the Census data adapted by the Office of Advocacy of the U.S. 
Small Business Administration).
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    18. According to SBA regulations, a manufacturer of household 
appliances must have 500 or fewer employees in order to qualify as a 
small entity.\19\ Census bureau indicates that there are 55 firms that 
manufacture household equipment in the ``catch all'' category for such 
data. Of those, 42 have fewer than 500 employees and qualify as small 
entities.\20\ The remaining 13 firms have

[[Page 42733]]

500 or more employees, and therefore, unless one or more has exactly 
500 employees do not qualify as small entities under the SBA 
definition.
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    \19\ 13 CFR 121.201, NAICS Code 333298.
    \20\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, NAICS 333298 (Bureau of the 
Census data adapted by the Office of Advocacy of the U.S. Small 
Business Administration).
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D. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements

    19. Part 15 transmitters are already required to be authorized 
under the Commission's certification procedure as a prerequisite to 
marketing and importation. See 47 CFR 15.101, 15.201, 15.305, and 
15.405. The new regulations will add permissible methods of operation 
for frequency hopping spread spectrum systems and permit systems that 
use digital modulation techniques to operate in the bands formerly 
reserved for spread spectrum operation. No new reporting or 
recordkeeping requirements will be required for the manufacturers of 
frequency hopping spread spectrum devices or systems using digital 
modulation.
    20. This Second Report and Order removes the requirement that 
direct sequence spread spectrum systems exhibit a minimum 10 db of 
processing gain. Therefore, manufacturers will no longer be required to 
test products and submit confirmation of compliance with this 
regulation.

E. Steps Taken To Minimize Significant Economic Impact on Small 
Entities and Significant Alternatives Considered

    21. The rule modifications made in this Second Report and Order 
will facilitate the continued development and deployment of new 
wireless devices for business and consumers. These actions will benefit 
manufacturers of digitally modulated unlicensed devices and direct 
sequence and frequency hopping spread spectrum devices, including small 
entities.
    24. In the FNPRM, we proposed to amend Sec. 15.247 of the 
Commission's rules to provide for the use of systems which use new 
digital modulation technologies. Specifically, we proposed to allow 
these devices to operate in the 915 MHz, 2.4 GHz, and 5.7 GHz bands 
under the same technical requirement as spread spectrum systems. We 
invited comment on whether these technologies should be allowed to 
operate at the same power levels as direct sequence spread spectrum 
systems, specifically 1 Watt maximum output power with a maximum power 
spectral density of 8 dBm per 3 kHz. We also noted that the proposals 
for new digital devices are similar to the rules for Unlicensed 
National Information Infrastructure (U-NII) devices contained in 
Subpart E of part 15, and sought comment on whether these new digital 
technologies could be accommodated under those rules.
    25. Based on analysis of the record, including comments from small 
business concerns, we have concluded that systems using digital 
modulation technologies may operate in the 915 MHz, 2.4 GHz, and 5.7 
GHz bands under the same rules as direct sequence spread spectrum 
devices without posing a risk of creating additional interference. We 
declined to regulate these devices under an alternative set of rules.
    26. The FNPRM also proposed to remove the requirement that direct 
sequence spread spectrum systems demonstrate a minimum of 10 dB of 
processing gain. One alternative the Commission considered was to 
decline to remove the requirement. However, we determined that 
retaining the requirement would unnecessarily hinder the introduction 
of new non-interfering devices in the bands.
    27. The First Report and Order (``First R&O'') in this proceeding 
amended the spread spectrum rules to allow frequency hopping spread 
spectrum systems in the 2.4 GHz band to use bandwidths greater than 1 
MHz but less than 5 MHz at a reduced power output of up to 125 mW.\21\ 
These wideband frequency hopping systems are allowed to use as few as 
fifteen non-overlapping channels provided that the total span of 
hopping channels is at least 75 MHz. Frequency hopping systems with a 
bandwidth of up to 1 MHz were still required to use at least 75 non-
overlapping hopping channels. In response to the First R&O, thirteen 
parties filed a Joint Petition for Clarification or, in the 
Alternative, Partial Reconsideration (``Joint Petition'').\22\ The 
Joint Petition requested that the Commission clarify the rules adopted 
in the First R&O to specify a minimum of 15 hopping channels for any 
system that uses adaptive hopping techniques to avoid operating on 
occupied frequencies and limits its output power to 125 mW, regardless 
of hopping channel bandwidth.\23\ In the FNPRM, we proposed to adopt 
the changes requested in the Joint Petition.
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    \21\ First Report and Order in ET Docket 99-231, 15 FCC Rcd 
16244 (2000), 65 FR 57557, September 25, 2000.
    \22\ Joint Petition For Clarification or, in the Alternative, 
Partial Reconsideration, submitted on October 25, 2000, by 3Comm, 
Apple Computer, Cisco Systems, Dell Computer, IBM, Intel 
Corporation, Intersil, Lucent Technologies, Microsoft, Nokia Inc., 
Silicon Wave, Toshiba America Information Systems, and Texas 
Instruments.
    \23\ Adaptive hopping is accomplished by the incorporation of 
intelligence within a frequency hopping spread spectrum system that 
permits the system to recognize other users within the band so that 
it individually and independently chooses and adapts its hopset to 
avoid occupied channels.
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    28. The majority of the commenters support the proposal to allow 
frequency hopping systems to use as few as fifteen hopping channels 
with output power not exceeding 125 mW.\24\ The commenters generally 
agree that a reduction in maximum allowed power from 1 Watt to 125 mW 
is an acceptable compromise in exchange for using fewer hopping 
channels.
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    \24\ See, e.g., comments of Adtran, Inc.; The Wireless 
Communications Association International; Silicon Wave, Inc.; Wi-
LAN, Inc.; WIDCOMM; Agere; Intel Corporation; Bluetooth SIG; Intel 
Corporation; and Apple Computers. See also reply comments of 
Telecommunications Industry Association.
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    29. Proxim objects to allowing as few as fifteen hopping channels 
for systems in the 2.4 GHz band. Proxim believes that this proposal 
could lead to frequency hopping systems that do not spread their energy 
through a wide portion of the band, and therefore increase interference 
potential to other receivers. It points to the 5.7 GHz band and notes 
that systems operating in that band use up to 60% of the available 
bandwidth.\25\ Proxim proposes that frequency hopping systems in the 
2.4 GHz band also be required to use at least 60% of the available 
band. It contends that the 60% threshold would serve the needs of 
manufacturers while preserving the underlying sharing philosophy of the 
part 15 rules. Ademco also proposes that a minimum amount of bandwidth 
be used. Although Ademco does support the proposed reduction in the 
minimum number of hopping channels, it states that the fifteen channels 
should be required to be spread over a minimum of 90% of the band.\26\ 
It submits that such a requirement would prevent any segment of the 2.4 
GHz band from being over used.
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    \25\ 125 MHz of spectrum is available at 5.7 GHz. A system using 
maximum a hopping channel bandwidth of 1 MHz would be required to 
use 75 MHz, or 60%, of the available spectrum.
    \26\ See Ademco comments at page 1.
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    30. We will allow frequency hopping spread spectrum systems to use 
as few as fifteen hopping channels with bandwidths up to 5 MHz and no 
minimum band occupancy requirements, provided output power is reduced 
to 125 mW. This modification of our regulations for frequency hopping 
systems will provide greater flexibility without significantly 
increasing the risk

[[Page 42734]]

of interference to other users. The reduction of maximum peak power 
from 1 Watt to 125 mW will offset any increased potential for 
interference caused by use of the reduced hopset, regardless of channel 
bandwidth. In addition, we find it unnecessary to require frequency 
hopping systems to occupy a minimum percentage of the 2.4 GHz band as 
Proxim and Ademco suggest. Our primarily concern for the operation of 
devices in the 2.4 GHz band is interference avoidance. Although a 
minimum bandwidth occupancy requirement may, in some cases, reduce the 
interference potential of frequency hopping systems, it is not the only 
method by which the systems can efficiently share the band. Indeed, 
such a requirement may actually negate the possibility for system 
designers to implement more efficient spectrum sharing techniques as 
they see fit. The simple, unambiguous rules we are adopting in this 
Second Report and Order will allow manufacturers the freedom to design 
an array of frequency hopping systems that effectively share the 2.4 
GHz band.
    31. We will not require frequency hopping systems that use a 
reduced hopset to employ adaptive hopping techniques. We agree with 
those parties who contend that the power reduction we are adopting for 
these devices is sufficient to mitigate any possible increase in 
interference potential due to the smaller number of hopping channels. 
Furthermore, operation pursuant to the modified rules will not pose a 
greater interference threat than systems already authorized under our 
rules.\27\ We also note that Sec. 15.247(h) of the rules permits the 
use of intelligent or adaptive hopping techniques in order to avoid 
transmitting on occupied frequencies.\28\ We believe that 
Sec. 15.247(h) provides sufficient flexibility for manufacturers to 
design products which incorporate adaptive hopping in circumstances 
where it would be beneficial. In accordance with the rules, 
manufacturers may design devices that incorporate both a frequency 
hopping spread spectrum transmitter and a digital modulation 
transmitter. Each transmitter must individually comply with applicable 
rules. However, the frequency hopping transmitter may adapt its hopset 
in order to avoid causing interference to the digital modulation 
transmitter.
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    \27\ See 47 CFR 15.247(a)(1)(iii). The rules allow frequency 
hopping systems to use as few as fifteen hopping channels provided 
the total span of hopping channels is at least 75 MHz. These systems 
are not required to incorporate adaptive hopping techniques.
    \28\ 47 CFR 15.247(h).
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    32. Report to Congress. The Commission will send a copy of the 
Second Report and Order, including this FRFA, in a report to Congress 
pursuant to the Congressional Review Act.\29\ In addition, the 
Commission will send a copy of the Second Report and Order, including 
the FRFA, to the Chief Counsel for Advocacy of the SBA.\30\
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    \29\ See 5 U.S.C. 801(a)(1)(A).
    \30\ See 5 U.S.C. 605(b).
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    33. Pursuant to the authority contained in Sections 4(i), 301, 302, 
303(e), 303(f), and 303(r) of the Communications Act of 1934, as 
amended, 47 U.S.C. Sections 154(i), 301, 302, 303(e), 303(f), and 
303(r), parts 2 and 15 of the Commission's rule are amended.
    34. The Commission's Consumer and Governmental Affairs Bureau, 
Reference Information Center, shall send a copy of this Second Report 
and Order, including the Final Regulatory Flexibility Act, to the 
Chief, Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Parts 2 and 15

    Communications equipment.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Rule Changes

    For the reasons set forth in the preamble, the Federal 
Communications Commission amends 47 CFR parts 2 and 15 as follows:

PART 2--FREQUENCY ALLOCATIONS AND RADIO TREATY MATTERS; GENERAL 
RULES AND REGULATIONS

    1. The authority citation for part 2 continues to read as follows:

    Authority: 47 U.S.C. 154, 302a, 303, and 336, unless otherwise 
noted.


Sec. 2.1033  [Amended]

    2. Section 2.1033 is amended by removing paragraph (b)(10) and 
redesignating paragraphs (b)(11) and (b)(12) as paragraphs (b)(10) and 
(b)(11), respectively.

PART 15--RADIO FREQEUNCY DEVICES

    3. The authority citation for part 15 continues to read as follows:

    Authority: 47 U.S.C. 154, 302, 303, 304, 307, 336, and 544A.

    4. Section 15.247 is amended as by:
    A. Revising paragraphs (a) introductory text, (a)(1)(ii), 
(a)(1)(iii), (a)(2), (b)(1), (c), and (d).
    B. Redesignating paragraphs (b)(3) and (b)(4) as paragraphs (b)(4) 
and (b)(5).
    C. Adding a new paragraph (b)(3).
    D. Removing and reserving paragraph (e).
    F. Revising paragraph (f).
    The additions and revisions read as follows:


Sec. 15.247  Operation within the bands 902-928 MHz, 2400-2483.5 MHz, 
and 5725-5850 MHz.

    (a) Operation under the provisions of this section is limited to 
frequency hopping and digitally modulated intentional radiators that 
comply with the following provisions:
    (1) * * *
    (ii) Frequency hopping systems operating in the 5725-5850 MHz band 
shall use at least 75 hopping frequencies. The maximum 20 dB bandwidth 
of the hopping channel is 1 MHz. The average time of occupancy on any 
frequency shall not be greater than 0.4 seconds within a 30 second 
period.
    (iii) Frequency hopping systems in the 2400-2483.5 MHz band shall 
use at least 15 non-overlapping channels. The average time of occupancy 
on any channel shall not be greater than 0.4 seconds within a period of 
0.4 seconds multiplied by the number of hopping channels employed. 
Frequency hopping systems which use fewer than 75 hopping frequencies 
may employ intelligent hopping techniques to avoid interference to 
other transmissions. Frequency hopping systems may avoid or suppress 
transmissions on a particular hopping frequency provided that a minimum 
of 15 non-overlapping channels are used.
    (2) Systems using digital modulation techniques may operate in the 
902-928 MHz, 2400-2483.5 MHz, and 5725-5850 MHz bands. The minimum 6 dB 
bandwidth shall be at least 500 kHz.
    (b) * * *
    (1) For frequency hopping systems in the 2400-2483.5 MHz band 
employing at least 75 hopping channels, and all frequency hopping 
systems in the 5725-5850 MHz band: 1 Watt. For all other frequency 
hopping systems in the 2400-2483.5 band: 0.125 Watt.
* * * * *
    (3) For systems using digital modulation in the 902-928 MHz, 2400-
2483.5 MHz, and 5725-5850 MHz bands: 1 Watt.
* * * * *
    (c) In any 100 kHz bandwidth outside the frequency band in which 
the spread spectrum or digitally modulated

[[Page 42735]]

intentional radiator is operating, the radio frequency power that is 
produced by the intentional radiator shall be at least 20 dB below that 
in the 100 kHz bandwidth within the band that contains the highest 
level of the desired power, based on either an RF conducted or a 
radiated measurement. Attenuation below the general limits specified in 
Sec. 15.209(a) is not required. In addition, radiated emissions which 
fall in the restricted bands, as defined in Sec. 15.205(a), must also 
comply with the radiated emission limits specified in Sec. 15.209(a) 
(see Sec. 15.205(c)).
    (d) For digitally modulated systems, the peak power spectral 
density conducted from the intentional radiator to the antenna shall 
not be greater than 8 dBm in any 3 kHz band during any time interval of 
continuous transmission.
* * * * *
    (f) For the purposes of this section, hybrid systems are those that 
employ a combination of both frequency hopping and digital modulation 
techniques. The frequency hopping operation of the hybrid system, with 
the direct sequence or digital modulation operation turned off, shall 
have an average time of occupancy on any frequency not to exceed 0.4 
seconds within a time period in seconds equal to the number of hopping 
frequencies employed multiplied by 0.4. The digital modulation 
operation of the hybrid system, with the frequency hopping operation 
turned off, shall comply with the power density requirements of 
paragraph (d) of this section.
* * * * *
[FR Doc. 02-15951 Filed 6-24-02; 8:45 am]
BILLING CODE 6712-01-P