[Federal Register Volume 68, Number 197 (Friday, October 10, 2003)]
[Rules and Regulations]
[Pages 58629-58631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-25654]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 25

[IB Docket No. 02-30; FCC 03-197]


Licensing Domestic Satellite Earth Stations in the Bush 
Communities of Alaska

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: The Federal Communications Commission (FCC) has adopted a 
Report and Order that discontinue the Alaska Bush Earth Station Policy 
(Alaska Bush Policy), which precludes installing or operating more than 
one satellite earth station in any Alaskan Bush community for 
competitive carriage of interstate Message Telephone Service (MTS) 
communications, i.e., ordinary interstate, interexchange toll telephone 
calls. Alaska Bush communities, as defined for purposes of the policy, 
are rural Alaskan communities of less than 1,000 residents that are 
isolated from larger cities by rugged terrain and harsh weather 
conditions.

DATES: Effective November 10, 2003.

FOR FURTHER INFORMATION CONTACT: JoAnn Lucanik at (202) 418-0873. 
Internet: [email protected], International Bureau, Federal 
Communications Commission, 445 12th Street, SW., Washington, DC 20554.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
in IB Docket No. 02-30, RM No. 7246, FCC 03-197, adopted August 6, 
2003. The complete text of this decision is available for inspection 
and copying during normal business hours in the FCC Reference 
Information Center Portals II, 445 12th Street, SW., Room CY-A257, 
Washington, DC 20554, and also may be purchased from the Commission's 
copy contractor, Qualex International Portals II, 445 12th Street, SW., 
Room CY-B402, Washington, DC 20554, telephone (202) 863-2893, facsimile 
(202) 863-2898, or via e-mail, [email protected].

Summary of the Report and Order

    The Federal Communications Commission has adopted a Report and 
Order that will discontinue the Alaska Bush Policy. This action 
eliminates a long-standing exception to the Commission's general policy 
favoring open entry for facilities-based competition in the provision 
of interstate MTS telecommunications services. We believe that allowing 
facilities-based competition of interstate MTS in Alaska Bush 
communities will encourage improvement in the quality of service 
available in those communities, promote more efficient delivery of 
service, and reduce incentives for overcharging for use of these 
facilities.
    A complete history of the Alaska Bush Policy may be found in the 
Notice of Proposed Rulemaking in this proceeding and will not be 
repeated here. See Policy for Licensing Domestic Satellite Earth 
Stations in the Bush Communities of Alaska, Notice of Proposed 
Rulemaking, 67 FR 37750 (May 30, 2002). Briefly, the policy of 
licensing only one satellite earth station in each Alaska Bush 
community to provide conventional interexchange MTS was formulated in 
the Commission's Tentative Decision in 1982. Pursuant to the Alaska 
Bush Policy, Alascom, Inc. (Alascom), now a wholly owned subsidiary of 
AT&T Corp., alone or in partnership with United Utilities, Inc. 
(United), a local exchange carrier, was authorized to construct and 
operate the earth station facilities in the Alaska Bush communities and 
to provide MTS service. The Alaska Bush Policy was based on the 
principle that duplicative proposals for facilities in the Alaska Bush 
communities are mutually exclusive because one facility could provide 
all the services provided by either party, and there was no public 
interest benefit in the construction of duplicate MTS facilities.
    When the Commission formally adopted the Alaska Bush Policy in 
1984, no MTS competition, in any form, had been authorized in Alaska. 
See Policies Governing the Ownership and Operation of Domestic 
Satellite Earth Stations in the Bush Communities in Alaska, 49 FR 9727 
(March 15, 1984), Final Decision. In 1990, however, the Alaska 
legislature opened most of the State's telecommunications markets to 
facilities-based competition, but not the Alaska Bush communities. See 
Act of June 7, 1990, 1990 Alaska Sess. Laws Ch. 93; see also 
Regulations Governing the Market Structure for Interstate Interexchange 
Telecommunications Services, 10 APUC 407 (1990). Five years later the 
Regulatory Commission of Alaska (RCA) granted General Communication, 
Inc. (GCI), an Alaskan facilities-based interstate long distance 
carrier, a temporary waiver, allowing it to install earth stations in 
50 Alaska Bush communities and to provide intrastate MTS in competition 
with Alascom on an experimental basis. The following year the FCC's 
International Bureau (Bureau) granted GCI's request to waive the Alaska 
Bush Policy in the same 50 Alaska Bush communities, thus allowing GCI 
to use its earth stations to provide both interstate and intrastate MTS 
in these 50 communities. See Petition of General Communication, Inc. 
for a Partial Waiver of the Bush Earth Station Policy, Memorandum 
Opinion and Order, 11 FCC Rcd 2535 (Int'l Bur. 1996) (GCI Waiver). The 
Bureau concluded that the potential public interest benefits of 
providing the 50 Alaska Bush communities with increased service 
options, improved quality, and lower rates outweighed a rigid adherence 
to a policy that does not provide for technological advancements and 
market changes.
    In 2000, the RCA found that allowing GCI to construct duplicate 
earth stations in the 50 Alaska Bush communities had, in fact, led to a 
more efficient use of available satellite resources, resulting in 
consumers benefiting from lower retail rates and improved service 
quality. In view of its finding, the RCA eliminated Alaska's 
restrictions on facilities-based MTS competition in the Alaskan Bush. 
See Consideration of the Reform of Intrastate Interexchange 
Telecommunications Market Structure and Regulations in Alaska, Docket 
R-98-1, Order No. 6 (RCA, Nov. 20, 2000) (not published in the Federal 
Register).

[[Page 58630]]

Thus, the FCC's Bush Policy remains the only significant regulatory 
barrier to facilities-based MTS competition throughout Alaska.
    On February 15, 2002, the Commission released the NPRM in this 
proceeding, proposing to discontinue the Alaska Bush Policy. The 
Commission noted in the NPRM that the Alaska Bush Policy is based on 
the proposition that applications for ``duplicative'' Alaska Bush earth 
stations are mutually exclusive. It also noted that the Alaska Bush 
Policy was formulated prior to the advent of MTS competition, and is 
based on a regulatory policy designed to prevent non-dominant carriers 
from investing in facilities at their own expense to compete with a 
carrier with an established facilities monopoly. Finally, the 
Commission pointed to the fact that the RCA has removed the parallel 
intrastate entry barrier. Consequently, the Commission tentatively 
concluded that the time has arrived to remove the barrier against 
facilities-based interstate MTS in the Alaska Bush as well. The 
Commission also tentatively concluded that facilities-based competition 
in the provision of interstate MTS in Alaska Bush communities will 
result in public interest benefits comparable to those that were 
realized in the 50 Alaska Bush communities in which GCI has been 
allowed to provide competitive MTS service. Accordingly, the Commission 
invited comment on its proposal to abolish the Alaska Bush Policy.
    Three parties, Alascom and AT&T, GCI, and the RCA, have filed 
comments in response to the NPRM. All three commenters support the 
Commission's proposal to eliminate its prohibition on the installation 
or operation of more than one satellite earth station in any Alaska 
Bush community for the competitive carriage of interstate MTS.
    The RCA submits that since 1995, when both the RCA and the FCC 
waived applicable Alaska Bush facility restrictions to allow GCI to 
construct duplicate earth stations in Bush communities, consumers have 
benefited from lower retail rates and improved service quality. 
According to the RCA, these benefits are what ultimately motivated it 
to eliminate the State's restrictions on facilities-based intrastate 
MTS competition in Bush Alaska in 2000. Moreover, the RCA says that 
facilities-based MTS competition in Alaska Bush communities will also 
establish an incentive for Alascom to operate more efficiently.
    GCI provides specific examples of how competition between it and 
Alascom has benefited the Alaska Bush communities with improved 
telecommunication efficiency and new service offerings. According to 
GCI, the first and perhaps most significant technological improvement 
was the implementation of its Demand Assigned Multiple Access (DAMA) 
satellite transmission system, which allows bandwidth to be used more 
efficiently. Before DAMA, all channels were assigned exclusively to a 
certain community and could not be used for other communities; DAMA 
also eliminated the need for a ``double hop'' configuration, where two 
satellite hops were needed to complete a call, resulting in signal 
delay and frequency echo, and rendering facsimile transmission 
unreliable and data transmission impossible. GCI states that the 
success it has achieved with DAMA has caused Alascom to upgrade many of 
its Alaska Bush earth station facilities to digital DAMA technology. 
GCI also states that greater facilities efficiency has enabled it to 
offer telemedicine in Alaska Bush communities, as well as reliable 
Internet connection for schools and libraries in nearly all of the 
Alaska Bush communities it serves. In addition, GCI says all customers 
in Alaska have benefited significantly from decreased long-distance 
rates since it entered the market.
    Alascom and AT&T also support repeal of the Alaska Bush Policy, but 
contend that other deregulatory actions, which they requested in a 
March 10, 2000 Petition, ``are indivisible aspects of the [Alaska] Bush 
Policy'' and thus, must be acted upon simultaneously. See Public 
Notice, Pleading Cycle Established for Comments on AT&T and Alascom 
Petition for Structural and Other Regulatory Relief in DA 00-603, 
released March 17, 2000 [not published in the Federal Register]. In 
this Petition, Alascom and AT&T requested, among other relief, that the 
Commission eliminate structural separation and tariffing requirements 
under which Alascom has been providing certain carrier-to-carrier 
services in Alaska. On January 7, 2003, Alascom filed a petition for 
waiver from the requirement that it annually file revised cost-based 
rates for these carrier-to-carrier services. See also Public Notice, 
Pleading Cycle Established for Comments on AT&T and Alascom Petition 
for Structural and Other Regulatory Relief in DA 00-603, released March 
17, 2000 (not published in the Federal Register). Alascom and AT&T 
point out in these petitions that Alascom now must disaggregate all of 
its service costs within Alaska by location, resulting in more than 900 
separate cost points. Alascom and AT&T contend that no other carrier 
has ever been forced to provide a service based upon stand-alone 
location-specific costs. The present tariff requirements, they submit, 
impose unwarranted competitive regulatory burdens that are preventing 
Alascom from providing its customers with improved service. These 
petitions are under consideration in separate dockets.
    The need for the Alaska Bush Policy is over. As was noted in the 
NPRM, the ``Alaska Bush Policy is an isolated exception to the 
Commission's interstate MTS open-entry policy.'' NPRM, 67 FR 37750 (May 
30, 2002). It was based on the assumption that authorizing more than 
one earth station in an Alaska Bush community would be duplicative and 
thus needlessly expensive, since a single earth station is sufficient 
to accommodate all the calls placed to or from the community. The GCI 
experience has demonstrated that the concern underlying the Alaska Bush 
Policy is no longer warranted. GCI has provided us with what we believe 
to be a preview of the public interest benefits that will be realized 
by allowing open-entry, facilities-based competition in the provision 
of interstate MTS in Alaska Bush communities. We believe that by 
eliminating the Alaska Bush Policy, citizens of the Alaska Bush 
communities will benefit from improved telecommunications services 
provided by both Alascom and its competitors at lower prices. For these 
reasons, we eliminate the Alaska Bush Policy.
    Finally, we note that this proceeding was established for the 
limited purpose of considering the elimination of the Alaska Bush 
Policy. Consequently, we decline to address at this time other 
potential changes to our regulatory requirements for Alaska. In 
particular, because, as indicated previously, eliminating the Alaska 
Bush Policy would promote important public interests, we decline to 
defer this deregulatory step pending our consideration of Alascom's and 
AT&T's March 2000 and January 2003 petitions.
    For the reasons set forth on the record in this proceeding, we 
abolish the Alaska Bush Policy, thus eliminating the restriction on 
facilities-based competition in the Alaska Bush.

Final Regulatory Flexibility Certification

    The Regulatory Flexibility Act of 1980, as amended (RFA), See 5 
U.S.C. 603. The RFA, see 5 U.S.C. 601 et seq., has been amended by the 
Contract With America Advancement Act of 1996, Public Law 104-121, 110 
Stat. 847 (1996) (CWAA). Title II of the CWAAA is the Small Business 
Regulatory

[[Page 58631]]

Enforcement Fairness Act of 1996, (SBREFA) requires that a regulatory 
flexibility analysis be prepared for rulemaking proceedings, unless the 
agency certifies that ``the rule will not have a significant economic 
impact on a substantial number of small entities.'' 5 U.S.C. 605(b). 
The RFA generally defines ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' 5 U.S.C. 605(6). In addition, the term 
``small business'' has the same meaning as ``small business concern'' 
under the Small Business Act. [See 5 U.S.C. 605(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 the opportunity for public comment, 
establishes one or more definitions of such term that are appropriate 
to the activities of the agency and publishes such definition(s) in the 
Federal Register.] A small business concern is one that: (1) Is 
independently owned and operated; (2) is not dominant in its field or 
operation; and (3) satisfies any additional criteria established by the 
Small Business Administration (SBA). Small Business Act, 15 U.S.C. 632 
(1996).
    The Report and Order repeals a regulatory policy that prevented 
companies from obtaining licenses to operate earth stations in rural 
Alaska that would carry telephone calls between users in certain 
Alaskan communities and users in other states if such service was 
already available in those communities via facilities provided by an 
established carrier. Because the Report and Order does not impose any 
regulatory burden, we certify that it will not have a significant 
economic impact on a substantial number of small businesses. The 
Commission will send a copy of the Report and Order, including a copy 
of this final certification, in a report to Congress pursuant to the 
Small Business Regulatory Enforcement Fairness Act of 1996. See 5 
U.S.C. 801(a)(1)(A). In addition, the Report and Order and this final 
certification will be sent to the Chief Counsel for Advocacy of the SBA 
and will be published in the Federal Register.
    The Alaska Bush Earth Station Policy, formally adopted by the 
Commission in Policies Governing the Ownership and Operation of 
Domestic Satellite Earth Stations in the Bush Communities in Alaska, 
Final Decision, 49 FR 9727 (March 15, 1984) is discontinued.
    The Commission's Consumer and Government Bureau, Reference 
Information Center, shall send a copy of this Report and Order, 
including the Final Regulatory Flexibility Certification, to the Chief 
Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Parts 1 and 25

    Satellites.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 03-25654 Filed 10-9-03; 8:45 am]
BILLING CODE 6712-01-P