[Federal Register Volume 76, Number 49 (Monday, March 14, 2011)]
[Proposed Rules]
[Pages 13799-13849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-5348]



[[Page 13799]]

Vol. 76

Monday,

No. 49

March 14, 2011

Part IV





Federal Communications Commission





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47 CFR Parts 1, 6, 7 et al.



Implementing the Provisions of the Communications Act of 1934, as 
Enacted by the Twenty-First Century Communications and Video 
Accessibility Act of 2010; Proposed Rule

Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / 
Proposed Rules

[[Page 13800]]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1, 6, 7, and 8

[CG Docket No. 10-213; WT Docket No. 96-198; CG Docket No. 10-145; FCC 
11-37]


Implementing the Provisions of the Communications Act of 1934, as 
Enacted by the Twenty-First Century Communications and Video 
Accessibility Act of 2010

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Commission proposes to adopt rules that 
implement provisions in section 104 of the Twenty-First Century 
Communications and Video Accessibility Act of 2010 (CVAA), the most 
significant piece of accessibility legislation since the passage of the 
Americans with Disabilities Act in 1990. This proceeding would update 
and amend the Commission's rules to ensure that individuals with 
disabilities are able to fully utilize advanced communications services 
(ACS) and equipment and networks used for such services. Specifically, 
we seek comment on ways to implement the CVAA's requirements on 
providers of ACS and manufacturers of equipment used for ACS to make 
their services and products accessible to people with disabilities. The 
intended effect is to promote rapid deployment of and universal access 
to broadband services for all Americans across the country, because 
broadband technology can stimulate economic growth and provide 
opportunity for all Americans.

DATES: Submit comments on or before April 13, 2011. Submit reply 
comments on or before May 13, 2011.

ADDRESSES: Federal Communications Commission, 445 12th Street, SW., 
Washington, DC 20554. A copy of any comments on the Paperwork Reduction 
Act information collection requirements contained herein should be 
submitted to the Federal Communications Commission via e-mail to 
[email protected]. You may submit comments, identified by FCC 11-37, or by CG 
Docket No. 10-213, WT Docket No. 96-198, CG Docket No. 10-145, by any 
of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
     People with Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by e-mail: [email protected] or phone: (202) 
418-0530 or TTY: (202) 418-0432.
    For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: David Hu, Broadband Division, Wireless 
Telecommunications Bureau, FCC at (202) 418-7120 or via the Internet to 
[email protected], or Rosaline Crawford, Disability Rights Office, 
Consumer and Governmental Affairs Bureau, FCC at (202) 418-2075 or via 
the Internet to [email protected]. For additional information 
concerning the Paperwork Reduction Act information collection 
requirements contained in this document, contact Judith B. Herman at 
(202) 418-0214, or submit your PRA comments via the Internet at 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking, FCC 11-37, adopted on March 2, 2011, and 
released on March 3, 2011. The full text of this document is available 
for inspection and copying during normal business hours in the FCC 
Reference Information Center, Room CY-A257, 445 12th Street, SW., 
Washington, DC 20554. The complete text may be purchased from the 
Commission's duplicating contractor, Best Copy and Printing, Inc. 
(BCPI), Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 
20554, (202) 488-5300, facsimile (202) 488-5563, or via e-mail at 
[email protected]. The complete text is also available on the 
Commission's Web site at http://wireless.fcc.gov/edocs_public/attachment/FCC-11-37A1doc. This full text may also be downloaded at: 
http://wireless.fcc.gov/releases.html. Alternative formats (computer 
diskette, large print, audio cassette, and Braille) are available by 
contacting Brian Millin at (202) 418-7426, TTY (202) 418-7365, or via 
e-mail to [email protected].

Summary

I. Introduction and Overview

    1. This Notice of Proposed Rulemaking (``NPRM'') initiates a 
proceeding to update the Commission's rules to ensure that the 54 
million individuals with disabilities are able to fully utilize 
advanced communications services and equipment and networks used for 
such services. Also, this NPRM proposes to adopt rules that implement 
provisions in section 104 of the ``Twenty-First Century Communications 
and Video Accessibility Act of 2010'' (hereinafter referred to as the 
``CVAA''), Public Law 111-260, 124 Stat. 2751 (2010), the most 
significant piece of accessibility legislation since the passage of the 
Americans with Disabilities Act in 1990 (``ADA''). (See also Public Law 
111-265, 124 Stat. 2795 (2010) (making technical corrections to the 
CVAA)).
    2. In explaining the need for the CVAA, Congress noted that the 
communications marketplace has undergone a ``fundamental 
transformation'' since Congress acted to ensure access to 
telecommunications services and equipment by people with disabilities 
as part of the Telecommunications Act of 1996. See S. Rep. No. 111-386 
(2010) and H.R. Rep. No. 111-563 (2010). Specifically, Congress stated 
that since it added section 255 to the Communications Act of 1934, as 
amended (hereinafter referred to as ``the Communications Act'' or ``the 
Act''), ``Internet-based and digital technologies * * * driven by 
growth in broadband * * * are now pervasive, offering innovative and 
exciting ways to communicate and share information.'' Congress found, 
however, that people with disabilities often have not shared in the 
benefits of this rapid technological advancement and that they face 
disproportionately higher rates of unemployment and poverty than those 
without disabilities. Recent surveys confirmed this finding, showing a 
gap of 38 percentage points in the rates of employment of working-age 
people with disabilities and those without disabilities (21% v. 59%) 
and a gap of 27 percentage points in the rates of Internet access (54% 
v. 81%).
    3. These trends are even more troubling when one considers the pace 
at which the communications marketplace is changing and how we as a 
society are becoming more dependent on such technologies to succeed in 
the workplace and to manage our daily lives. Statistics show, for 
example, that more than ever, Americans rely on their mobile phones for 
much more than phone service. Increasingly, wireless handsets have 
evolved into multi-media devices capable of accessing the Internet, 
sending e-mails or text messages, downloading music, and viewing 
streaming video programming that can, for example, enable distance 
education and telemedicine. As described in the National Broadband 
Plan, one of the Commission's most important policy objectives is the 
rapid deployment of and universal access to

[[Page 13801]]

broadband services for all Americans across the country, because 
broadband technology can stimulate economic growth and provide 
opportunity for all Americans. To that end, the recommendations in the 
National Broadband Plan were consistent with the objectives set forth 
in the CVAA. This law will bring existing communication laws protecting 
people with disabilities in line with 21st Century technologies by 
ensuring that people with disabilities are not left behind and that 
they will be able to share fully in the economic, social, and civic 
benefits of broadband.
    4. This NPRM seeks comment on the way in which we should implement 
the requirements of sections 716 and 717, which were added by section 
104 of Title I of the CVAA. The statute requires the Commission to 
adopt rules within one year of enactment. section 716 requires that 
providers of ``advanced communications services'' (or ``ACS'') and 
manufacturers of equipment used for ACS make their services and 
products accessible to people with disabilities, unless it is not 
achievable to do so. The CVAA provides flexibility to the industry by 
allowing covered entities to comply with section 716 by either building 
access features into their equipment or services or relying on third 
party applications, peripheral devices, software, hardware, or customer 
premises equipment (or ``CPE'') that is available to individuals with 
disabilities at nominal cost. If such compliance is not achievable, 
covered entities must ensure that their equipment and services are 
compatible with ``existing peripheral devices or specialized customer 
premises equipment'' commonly used by persons with disabilities to 
achieve access, unless it is not achievable to do so. Section 717 
requires that the Commission establish new recordkeeping and 
enforcement procedures for manufacturers and providers subject to 
section 255 and section 716. Appendix D contains the full text of the 
CVAA as enacted (Pub. L. 111-260 and Pub. L. 111-265).
    5. While section 255 of the Act will be the starting point for our 
implementation of these sections, our proposed approach reflects 
several important differences between section 255 and section 716. 
First, section 716 covers a broader scope of services and related 
equipment than section 255. In addition, relative to section 255, 
section 716 requires a higher standard of achievement for covered 
entities but also allows for greater flexibility in how to accomplish 
these requirements. In the NPRM, we propose to adopt a new rule part to 
implement sections 716 and 717 of the Act and to amend the rules 
implementing section 255 of the Act to incorporate any relevant 
definitional changes in section 716 and establish the new recordkeeping 
and enforcement procedures set forth in section 717. The regulatory 
oversight we propose in this proceeding is not intended to prejudge the 
scope of the Commission's authority in other proceedings that derive 
from different statutory grants of authority.
    6. The NPRM also seeks comment on section 718, which is effective 
three years after the date of enactment of the CVAA and requires 
manufacturers and service providers to make Internet browsers built 
into mobile phones accessible to people who are blind or have visual 
impairments. Specifically, the NPRM seeks input on what steps the 
Commission and stakeholders can take to ensure that manufacturers and 
service providers can meet their obligations when section 718 goes into 
effect in 2013.

II. Background

    7. Section 255 of the Act, which was added by the 
Telecommunications Act of 1996, requires manufacturers of 
telecommunications equipment and providers of telecommunications 
services to ensure that their equipment and services are accessible to 
and usable by people with disabilities, if readily achievable. When the 
accessibility requirements of section 255 are not readily achievable, 
manufacturers and service providers must ensure compatibility with 
existing peripheral devices or specialized CPE commonly used by 
individuals with disabilities, if readily achievable. A related 
provision in section 251(a)(2) of the Act prohibits a 
telecommunications carrier from installing network features, functions 
or capabilities that do not comply with the guidelines and standards 
established pursuant to section 255.
    8. Section 255 directed the United States Access Board (``Access 
Board'') to work with the Commission to establish guidelines for the 
accessibility of telecommunications equipment and CPE within 18 months 
of enactment. In June 1996, the Access Board convened the 
Telecommunications Access Advisory Committee (TAAC), a federal advisory 
committee consisting of consumer, industry, and government 
stakeholders, for this purpose. The TAAC delivered its final report to 
the Access Board in January 1997, which the Access Board then used to 
develop its section 255 guidelines. In September 1999, the Commission 
adopted a Report and Order adding parts 6 and 7 to its rules to 
implement section 255, in large part incorporating the Access Board's 
guidelines for telecommunications equipment and customer premises 
equipment (``CPE''). In addition to drawing heavily on these guidelines 
for its rules implementing section 255 of the Act on telecommunications 
equipment and CPE (in part 6 of its rules), the Commission utilized the 
general principles contained in these guidelines to outline the general 
obligations of telecommunications service providers. In part 7 of these 
rules, the Commission also used its ancillary jurisdiction to adopt 
rules relating to voicemail and interactive voice response providers 
and equipment manufacturers. In 2007, the Commission extended its 
section 255 accessibility rules to interconnected Voice-over-Internet 
Protocol (``VoIP'') service providers and equipment manufacturers.
    9. The rules adopted to implement section 255 require that where 
readily achievable, manufacturers and service providers must evaluate 
the accessibility, usability, and compatibility features of covered 
services and equipment; incorporate such evaluation throughout product 
design, development, and fabrication, as early and consistently as 
possible; and identify barriers to accessibility and usability as part 
of the product design and development process. The rules also provide 
that where readily achievable, manufacturers and service providers must 
ensure that product and service information and documentation provided 
to customers is accessible to customers with disabilities. In addition, 
under the rules, equipment manufacturers must pass through cross-
manufacturer, nonproprietary, industry-standard codes, translation 
protocols, formats or other information necessary to provide 
telecommunications in an accessible format, where readily achievable. 
The rules also contain an informal complaint procedure by which 
manufacturers and service providers must attempt to resolve the 
complainant's concerns and respond to the Commission within 30 days.
    10. In 2006, the Access Board initiated a review of its 
accessibility guidelines for telecommunications equipment and CPE 
covered under section 255 of the Act and its standards for electronic 
and information technology covered under section 508 of the 
Rehabilitation Act. Under section 508, federal agencies must ``develop, 
procure, maintain, and use'' electronic and information technologies 
that are accessible to people with disabilities, unless doing so would 
cause an undue burden. The goal of this review was to

[[Page 13802]]

bring the section 255 and section 508 guidelines and standards up to 
date and to harmonize them with each other and international 
accessibility standards. Again, the Access Board established an 
advisory board of interested stakeholders for this purpose, and in 
April 2008, the Telecommunications and Electronic and Information 
Technology Advisory Committee (``TEITAC'') issued its final report, 
containing a set of recommended updates to these guidelines and 
standards. In March 2010, the Access Board released for public comment 
draft information and communication technology (``ICT'') guidelines and 
standards, which were based on these stakeholder recommendations.
    11. During the spring of 2010, the Consumer and Governmental 
Affairs Bureau (``CGB'') and the Wireless Telecommunications Bureau 
(``WTB'') (``the Bureaus'') held two workshops to explore the 
telecommunications access needs of people with disabilities, along with 
solutions to address these barriers. At the first of these, held on May 
13, 2010, the Commission received feedback on expanding disability 
access to wireless telecommunications; at the second, held on June 15, 
2010, young adults who are deaf-blind discussed the barriers they 
experience in accessing telecommunications and in obtaining information 
about accessible technologies.
    12. Building on those workshops, on July 19, 2010, the Bureaus 
issued a public notice in DA 10-1324, in CG Docket No. 10-145 
expressing the concerns ``that people who are blind or have other 
vision disabilities have few accessible and affordable wireless phone 
options'' and ``that many wireless technologies may not be compatible 
with Braille displays needed by individuals who are deaf-blind.'' The 
July public notice sought comment on, among other things, the barriers 
faced by these populations, the cost and feasibility of technical 
solutions, and the actions that the agency should take to address the 
current lack of access. The Bureaus received over 200 submissions in 
the record from consumers, consumer groups, trade associations, and 
individual companies, many of whom provided details about the lack of 
access to basic and smart phones. While staff continues to consider the 
steps the agency should take to address those concerns, we have 
incorporated the record from the July public notice into the record of 
this proceeding because the record in CG Docket No. 10-145 is 
particularly relevant and may inform our understanding of the issues 
raised here, including the difficulties that people with disabilities 
face in finding accessible products and getting the technical and 
customer support that they need in today's marketplace.
    13. On October 21, 2010, CGB and WTB issued a public notice in DA 
10-2029, seeking input on key provisions in sections 716, 717, and 718 
of the Communications Act, as amended by the CVAA. The Bureaus received 
24 comments and 25 reply comments, which have helped to shape the 
development of this NPRM.

III. Statutory Definitions

A. Scope of Coverage

1. Background
    14. Section 716 of the Act covers a broad array of manufacturers of 
equipment and providers of services that are not covered under section 
255. As discussed in more detail below, the requirements of section 716 
apply to the manufacturers of equipment used for non-interconnected 
VoIP services, electronic messaging services, and interoperable video 
conferencing services (all of which are ``advanced communications 
services'' as defined in section 3(1) of the Act) and the providers of 
those services. (Although interconnected VoIP service also constitutes 
an ACS, such service is subject to section 255 of the Act and thus need 
not comply with the requirements of section 716.) We agree with AT&T's 
statement that ``section 716 reflects the reality that ACS is delivered 
in a complex Internet ecosystem'' and that ``[a]ccessibility 
obligations must be shared by all entities in that ecosystem for 
consumers to have an accessible experience.'' We discuss the evolution 
of the ``complex Internet ecosystem'' below and seek further comment on 
how we should interpret section 716 requirements, in light of this 
evolution and the statute's broader purposes of ensuring that ACS and 
equipment used for ACS is accessible to and usable by people with 
disabilities.
    15. Since section 255 was first enacted, communication technology 
has changed significantly, both in terms of its usage of the Internet 
and packet-switched networks instead of circuit-switched networks and 
in its common architecture. In many cases, communication devices had a 
single function, and were created by a single manufacturer and often 
closely tied to a specific communication service or network. As the 
fixed and mobile Internet has evolved, mass-market communication 
devices are now often general-purpose computers or devices such as 
smart phones incorporating aspects of general-purpose computers, with 
an architecture reflecting the evolution of computer technology. This 
architecture has been common for personal computers since the 1980s, 
but has more recently also made its way into mobile devices such as 
smart phones and tablets, and into entertainment devices such as game 
consoles and set-top boxes. In all of these cases, systems can be 
divided into at least five components that can be pictured, roughly, as 
layers, with the hardware at the bottom and the application and 
services at the top:
     Hardware (commonly referred to as the ``device''): Every 
advanced communications service relies on hardware with general-purpose 
computing functionality. It typically includes a computing component 
(``CPU''), several kinds of memory, one or more network interfaces 
(cellular, IEEE 802.11 ``WiFi,'' Ethernet, Bluetooth, etc.), built-in 
peripherals such as keyboards and displays, and both generic and 
dedicated-purpose interfaces to external peripherals. A common example 
of a generic interface is a USB interface, as it can support just about 
any input or output technology, from audio to keyboards and cameras. A 
dedicated-purpose interface can only support one media type, such as 
audio.
     Operating system (``OS''): The OS manages the system 
resources enumerated above and provides common functionality, such as 
network protocols, to applications. Almost all devices with a CPU have 
an OS.
     User interface layer: Most modern devices have a separate 
user interface (``UI'') layer upon which almost all applications rely 
to create their graphical user interface. Currently, the OS and user 
interface layer are typically provided as a package and are often 
referred to collectively as the OS, but this is not always the case. 
For example, at least one common OS allows users to replace the user 
interface layer. In many cases, web browsers are considered to be part 
of the UI layer although they themselves are also an application.
     Application (commonly referred to as an ``app''): Software 
is used to implement the actual advanced communications functionality. 
The software may be embedded into the device and non-removable, 
installed by the system integrator or user, or reside in the cloud.
     Network services: Advanced communication applications, 
such as VoIP, rely on network services to interconnect users. These 
networks perform many functions, ranging from user authentication and 
authorization to call routing and media storage. In many

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cases, such network services simply route the call signaling 
information and do not touch the actual media exchanged. In these 
cases, the service itself may not know or care what kind of media 
(audio, video, text) is exchanged between communicating end systems. In 
other cases, the network services may perform more than transport 
functions and offer video, voice, and other data capabilities.
    While the particulars of the above components have evolved, the 
basic architecture has remained stable for several decades and there 
are no obvious successors under development in the research community. 
Thus, it appears reasonably safe to assume that this division will 
continue for the immediate future, although we note that the components 
listed above overlap with each other.
    16. Because each of the above components may be created by a 
different manufacturer and sold separately, this division has three 
major consequences. First, a manufacturer or provider of one component 
may have limited ability to know which other components are being used 
to deliver an advanced communications service. For example, a PC- and 
web-based collaboration service can run on most personal computers, 
using an almost infinite set of combinations of hardware, operating 
systems and web browsers. Second, components of the service can change 
over time. Users can often upgrade their hardware, OS, or application, 
without consulting with the manufacturer or provider of the other 
components. Third, the accessibility features of each component are 
likely to evolve over time. Manufacturers of hardware, OS, and user 
interface layers may not know whether the components they produce will 
be used for advanced communications services in the future and for 
which ones.
    17. In order to enable individuals with disabilities to use an 
advanced communications service, all of the components may have to 
support accessibility features and capabilities. Conversely, if one 
component does not offer a particular function, it is often impossible 
for another component to compensate for that omission. For example, 
only the hardware component can support an audio jack or a connection 
to an external Braille device, while only the OS and user interface 
layer can enable screen readers. In addition, it should be noted that 
while upper layers cannot make up for the lack of accessibility 
features at the lower layers, they can impede their use. For example, 
an application could render text in such a way that screen readers or 
Braille devices cannot function, e.g., to protect content against 
extraction as part of digital rights management functionality. While 
this environment complicates the ability to implement capabilities that 
support people with disabilities, we also recognize that these 
challenges are inherent in the design of any mass market application or 
hardware device. At the same time, we recognize that this environment 
also has the potential to provide new solutions for people with 
disabilities which were not previously possible.
    18. We seek comment on whether the above description accurately 
reflects the basic architecture and components involved in the delivery 
of ACS. Below, we seek comment on how we should interpret the statute's 
directives, in light of the architecture and components discussed 
above.
2. Manufacturers of Equipment Used for Advanced Communications Services
    19. Section 716(a) of the Act provides that, with respect to 
equipment manufactured after the effective date of applicable 
regulations established by the Commission and subject to those 
regulations, the accessibility obligations apply to a ``manufacturer of 
equipment used for advanced communications services, including end user 
equipment, network equipment, and software * * * that such manufacturer 
offers for sale or otherwise distributes in interstate commerce.''
    20. We first seek comment on the meaning of the term 
``manufacturer.'' We note that in our rules implementing section 255 of 
the Act we define ``manufacturer'' as ``an entity that makes or 
produces a product.'' In the Section 255 Report and Order, we found 
that ``[t]his definition puts responsibility on those who have direct 
control over the products produced, and provides a ready point of 
contact for consumers and the Commission in getting answers to 
accessibility questions and resolving complaints.'' We propose to adopt 
the same definition of ``manufacturer'' in our rules implementing 
section 716 and seek comment on this proposal.
    21. We also seek comment on the meaning of ``end user equipment,'' 
``network equipment'' and ``software,'' as those terms are used in 
section 716(a). We propose to define ``end user equipment'' as 
including hardware as described above; ``software'' includes the OS, 
the user interface layer, and applications, as described above, that 
are installed or embedded in the end user equipment by the manufacturer 
of the end user equipment or by the user; and ``network equipment'' 
includes equipment used for network services, as described above. We 
seek comment on whether upgrades to the software (OS, user interfaces, 
or applications) by manufacturers are encompassed in these definitions. 
We also seek comment on whether there are any circumstances in which a 
manufacturer of end user equipment would be responsible for the 
accessibility of software that is installed or downloaded by the user. 
In particular, we seek comment on commenters' assertions that the 
limitations on liability in section 2(a) of the CVAA generally preclude 
manufacturers from being liable for third party applications that are 
installed or downloaded by the consumer.
    22. In addition, we seek comment on the meaning of the phrase 
``used for advanced communications services,'' in section 716(a), for 
the purposes of determining a manufacturer's obligations under this 
section. As a general matter, must equipment subject to section 716(a) 
be capable of offering ACS on a standalone basis or merely support ACS 
in some way? If the former, then how should this standard be applied, 
for example, to Internet-enabled ACS intended to run on separately 
distributed general computing platforms?
    23. We also seek comment on the meaning of ``offers for sale or 
otherwise distributes in interstate commerce'' by ``such 
manufacturer.'' Hardware, as described above, commonly meets this 
definition. We seek comment on whether other components that are used 
for advanced communications services are offered for sale or otherwise 
distributed in interstate commerce by the manufacturer when installed 
or embedded by the manufacturer. We propose to treat generally the act 
of a manufacturer's making software available for download as a form of 
distribution. We seek comment, however, for purposes of the CVAA, on 
what should constitute making software available for download.
    24. We propose to hold manufacturers of end user equipment 
responsible for the accessibility of their products, including the 
software, such as the OS, the user interface layer, and the 
applications that they install. We also propose to find manufacturers 
of software used for advanced communications services that is offered 
for sale or otherwise distributed in interstate commerce by such 
manufacturers and that is downloaded or installed by the user as being 
covered by section 716(a).

[[Page 13804]]

3. Providers of Advanced Communications Services
    25. Section 716(b)(1) of the Act provides that, with respect to 
service providers, after the effective date of applicable regulations 
established by the Commission and subject to those regulations, a 
``provider of advanced communications services shall ensure that such 
services offered by such provider in or affecting interstate commerce 
are accessible to and usable by individuals with disabilities,'' unless 
these requirements are ``not achievable.''
    26. In the Section 255 Report and Order, the Commission found that 
providers of telecommunications services include resellers and 
aggregators. The Commission's decision was based on its interpretation 
of the statutory definition of ``telecommunications carrier'' as 
defined in section 3(51) of the Act. Specifically, the Commission noted 
that ``[section 3(51)] states that a `telecommunications carrier' means 
any `provider of telecommunications services' with the exception of 
aggregators, thus indicating that a `provider of telecommunications 
services' would otherwise include aggregators.'' While the CVAA does 
not provide similar guidance with respect to the definition of provider 
of ACS, we believe that the general principle that the Commission 
adopted in the Section 255 Report and Order--that ``Congress intended 
to use the term ``provider'' broadly * * * to include all entities that 
make telecommunications services available''--has applicability here. 
Accordingly, we propose to find providers of ACS to include all 
entities that make ACS available in or affecting interstate commerce, 
including resellers and aggregators. We seek comment on this proposal.
    27. We also seek comment on additional issues relating to the 
meaning of ``providers of advanced communications services.'' We 
propose to find such providers to include entities that provide ACS 
over their own networks as well as providers of applications or 
services accessed (i.e., downloaded and run) by users over other 
service providers' networks, as long as these providers make advanced 
communications services available in or affecting interstate commerce. 
We also seek comment on whether there are any circumstances in which a 
service provider would be responsible for the accessibility of third 
party services and applications or whether the liability provisions in 
section 2(a) of the CVAA would generally preclude such a result. We 
seek comment on these proposed approaches and on whether the fact that 
we are required under section 716(e)(1)(C) to ``determine the 
obligations under this section of manufacturers, service providers, and 
providers of applications or services accessed over service provider 
networks'' should have any bearing on how we interpret the meaning of 
providers of ACS. Specifically, we seek comment on the meaning of 
``providers of applications or services accessed over service provider 
networks'' and how this term differs from ``providers of advanced 
communications services.'' Finally, we also seek comment on the meaning 
of ``in or affecting interstate commerce.'' Are there any circumstances 
in which advanced communications services that are downloaded or run by 
the user would not meet this definition?
4. Advanced Communications Services
    28. Section 3(1) of the Act defines ``advanced communications 
services'' to mean (A) Interconnected VoIP service; (B) non-
interconnected VoIP service; (C) electronic messaging service; and (D) 
interoperable video conferencing service. That provision sets forth 
definitions for each of these terms.
a. Interconnected VoIP Service
    29. Section 3(25) of the Act, as added by the CVAA, provides that 
the term ``interconnected VoIP service'' has the meaning given in Sec.  
9.3 of the Commission's rules, as such section may be amended. Sec.  
9.3 of the Commission's rules, in turn, defines interconnected VoIP as 
a service that (1) enables real-time, two-way voice communications; (2) 
requires a broadband connection from the user's location; (3) requires 
Internet protocol-compatible CPE; and (4) permits users generally to 
receive calls that originate on the public switched telephone network 
(``PSTN'') and to terminate calls to the PSTN. We propose to continue 
to define interconnected VoIP in accordance with Sec.  9.3 of the 
Commission's rules. We seek comment on this proposal.
    30. Section 716(f) of the Act provides that ``the requirements of 
this section shall not apply to any equipment or services, including 
interconnected VoIP service, that are subject to the requirements of 
section 255 on the day before the date of enactment of the Twenty-First 
Century Communications and Video Accessibility Act of 2010.'' In the 
October Public Notice, the Bureaus sought comment on how to address the 
accessibility obligations of equipment that is used to provide both 
telecommunications and advanced communications services and how to 
treat interconnected VoIP. In its comments, AT&T states that ``the 
Commission should subject multi-purpose devices to section 255 to the 
extent that the device provides a service that is already subject to 
section 255 and apply section 716 solely to the extent that the device 
provides ACS that is not otherwise subject to section 255.'' We seek 
comment on AT&T's interpretation and also seek comment on alternative 
interpretations of section 716(f).
b. Non-interconnected VoIP Service
    31. Section 3(36) of the Act, as added by the CVAA, states that the 
term ``non-interconnected VoIP service'' means a service that ``(i) 
enables real-time voice communications that originate from or terminate 
to the user's location using Internet protocol or any successor 
protocol; and (ii) requires Internet protocol compatible customer 
premises equipment'' and that ``does not include any service that is an 
interconnected VoIP service.'' We propose to define ``non-
interconnected VoIP service'' in our rules in the same way and seek 
comment on this proposal.
    32. We propose to treat any offering that meets the criteria of the 
statutory definition set forth above as a ``non-interconnected VoIP 
service,'' and note that the statutory definition of non-interconnected 
VoIP does not exclude offerings with a purely incidental VoIP 
component. We seek comment on this proposal. We also note that, as 
discussed below, the statute allows the Commission to waive the 
requirements of section 716 for equipment or services ``designed 
primarily for purposes other than using advanced communications 
service.'' In addition, as discussed below, section 716(i) provides 
that the requirements of this Section do not apply to ``customized 
equipment or services that are not offered directly to the public.''
c. Electronic Messaging Service
    33. Section 3(19) of the Act, as added by the CVAA, states that the 
term ``electronic messaging service'' means a service that provides 
real-time or near real-time non-voice messages in text form between 
individuals over communications networks. In accordance with this 
definition, we propose to define this term in the Commission's rules as 
``a service that provides real-time or near real-time non-voice 
messages in text form between individuals over communications 
networks.'' Consistent with language of the Senate and House Reports, 
we also propose that electronic messaging service includes ``more 
traditional, two-way interactive services such as text messaging, 
instant messaging, and

[[Page 13805]]

electronic mail, rather than * * * blog posts, online publishing, or 
messages posted on social networking websites.'' We seek comment on 
these proposed definitions. For reasons similar to those discussed 
below in the section on interoperable video conferencing services, we 
believe that Internet protocol relay (``IP Relay'') services that 
otherwise fit the definition of ``electronic messaging services'' are 
services subject to the requirements of section 716.
    34. We also seek comment on the assertion of several commenters 
that the phrase ``between individuals'' in the above definition 
precludes the application of the accessibility requirements to 
communications in which no human is involved, such as automatic 
software updates or other device-to-device or machine-to-machine 
communications. In addition, we seek comment on TIA's assertion that 
``services and applications that merely provide access to an electronic 
messaging service, such as a broadband platform that provides an end 
user access to an HTML-based e-mail service, are not covered.''
d. Interoperable Video Conferencing Service
    35. Section 3(1) of the Act, as added by the CVAA, defines the term 
``advanced communications services'' to include ``interoperable video 
conferencing service,'' which, in turn, is defined in section 3(27) as 
``a service that provides real-time video communications, including 
audio, to enable users to share information of the user's choosing.'' 
We note that while earlier versions of the legislation did not include 
the word ``interoperable'' in the definition of the term ``advanced 
communications services,'' the definition of ``interoperable video 
conferencing services'' in the enacted legislation is identical to the 
definition of ``video conferencing services'' found in earlier 
versions. In addition, language in the Senate Report regarding 
``interoperable video conferencing services'' is identical to language 
in the House Report regarding ``video conferencing services.'' Both the 
Senate Report and the House Report state, for example, that ``[t]he 
inclusion * * * of these services within the scope of the requirements 
of this act is to ensure, in part, that individuals with disabilities 
are able to access and control these services'' and that ``such 
services may, by themselves, be accessibility solutions.'' In light of 
the above symmetries between the earlier and later versions of this 
definition, as well as the reports prepared by each chamber of 
Congress, we will first seek comment on the meaning of ``video 
conferencing service'' and then on the meaning of ``interoperable'' in 
this context.
i. Video Conferencing Service
    36. We first seek comment on what services meet the statutory 
definition of ``providing * * * real-time video communications, 
including audio, to enable users to share information of the user's 
choosing'' and what end user equipment, network equipment, and software 
are used for these services. We propose to classify a range of services 
and end user equipment under this statutory definition, including, but 
not limited to videophones and software applications used for 
conversation between and among users. Such end user equipment includes 
smart phones and computers with the capability of using interactive 
video, text and audio conferencing applications such as the Apple 
iPhone 4.0, Motorola Droid X and computers and videophones such as ASUS 
Skype, Grandstream, Ojo, and Polycom. Examples of video conferencing 
software applications include, for example, Google Voice & Video Chat, 
ooVoo, AOL Instant Message (``AIM'') Chat, WebEx, and Skype. We seek 
comment on this proposal.
    37. We also seek comment on whether video relay services (``VRS'') 
meet the above definition. VRS is a form of TRS under section 225 of 
the Act that enables individuals who are deaf or hard of hearing and 
who use American Sign Language to communicate over distances with voice 
telephone users through a remotely located sign language interpreter 
called a CA. The person who is deaf or hard of hearing makes a VRS call 
using video equipment (a television or a computer with a video camera 
device) that connects such individual with the CA over a broadband 
connection. The CA then relays the conversation between the parties--in 
sign language with the VRS user (the ``video leg''), and by voice with 
the telephone user (the ``telephone leg''). Voice telephone users can 
also initiate VRS calls by simply dialing the telephone number of the 
person who uses sign language. The call is then automatically connected 
to a CA, who then relays the conversation.
    38. Commenters disagree about whether the CVAA covers the video 
conferencing service and equipment used in the provision of VRS. 
Sorenson cites to the legislative history and submits that ``Section 
716 was intended to cover mass market services and equipment (such as 
personal computers and smart phones) that have not been designed for 
use by people with disabilities, not services and equipment (such as 
VRS and point-to-point) that have been designed specifically to be 
accessible to and usable by persons with disabilities.'' Consumer 
Groups disagree, stating that ``VRS equipment and [video conferencing] 
services * * * should be made accessible in accordance with the 
Accessibility Act, if achievable.'' Sorenson also asserts that the 
phrase ``including audio'' in the definition suggests the exclusion of 
VRS ``video conferencing service'' or equipment. Consumer Groups reject 
Sorenson's assertion because widely distributed VRS equipment includes 
audio functions that ``benefit users who engage in voice carryover 
(`VCO') and hearing carryover (`HCO').''
    39. We agree with Consumer Groups and believe that the ``video 
leg'' of a VRS call meets the statutory definition of ``provid[ing] * * 
* real-time video communications, including audio, to enable users to 
share information of the user's choosing.'' Just as a voice telephone 
user uses telecommunications services and equipment to communicate with 
the VRS CA (the ``telephone leg'' of a VRS call), we propose to find 
that a VRS consumer uses video conferencing services and equipment to 
communicate with the VRS CA (the ``video leg'' of a VRS call). We find 
nothing in the statute or the legislative history to suggest that 
providers of video conferencing services and manufacturers of equipment 
used for VRS who otherwise are covered under the CVAA should be 
excluded from its requirements simply because their services are a kind 
of TRS provided pursuant to section 225 of the Act. While VRS equipment 
and services are specifically designed for people who are deaf or hard 
of hearing and use sign language, they are not necessarily designed for 
those who have additional disabilities as well (e.g., individuals who 
are deaf and have low vision, a mobility, or dexterity disability). We 
do not believe this interpretation will in any way diminish or change 
the obligations of VRS providers that are contained in part 64 of the 
Commission's rules. We seek further comment on this issue and on 
whether such an interpretation would create any difficulties or 
conflicts in our implementation of the VRS program.
    40. We note that consumers who are deaf or hard of hearing also use 
video equipment distributed by VRS providers for point-to-point calls 
with other users of this equipment. We believe that such point-to-point 
calling also meets the CVAA's statutory definition of ``providing * * * 
real-time video communications, including audio, to

[[Page 13806]]

enable users to share information of the user's choosing,'' and seek 
comment on this analysis.
    41. We also seek further comment on whether webinars are a covered 
service. TIA states that ``a service that enables users to share 
information necessarily implies a two-way service, not a broadcast-
style webinar video.'' The IT and Telecom RERCs disagree, however, 
asserting that webinar systems should be subject to Section 716 because 
these systems are ``not designed to broadcast information but rather to 
provide user interaction in the form of chat, voting, and hand-raising, 
etc.''
    42. Next, we seek comment on Consumer Groups' assertion that ``the 
scope of the [CVAA] should not be limited by the type of communication 
conveyed by the video conferencing service (i.e., uni-, bi-, or multi-
directional), but by the fact that the service is capable of providing 
real-time communications that enable users to share information.'' 
Consumer Groups suggest, for example, that the fact that ``video 
conferencing services may be used to leave a `video mail' (similar to a 
`voice mail') message,'' does not preclude the service's coverage under 
the CVAA. Consistent with our seeking comment on how to treat multi-
purpose devices above we seek comment on Consumer Groups' suggestion. 
We also seek comment more generally on whether services that otherwise 
meet the definition of ``provid[ing] * * * real-time video 
communications, including audio, to enable users to share information 
of the user's choosing'' but that also provide non-real-time functions 
(such as video mail) are covered under the CVAA. If so, are the non-
real-time functions or near-real-time functions of such a service (such 
as video mail) subject to the requirements of section 716? If such 
functions are not covered, should we, similar to what we did in the 
section 255 context, assert our ancillary jurisdiction to cover video 
mail? Specifically, the Commission employed its ancillary jurisdiction 
to extend the scope of section 255 to both voicemail and interactive 
menu services under part 7 of the Commission's rules because ``the 
failure to ensure accessibility of voicemail and interactive menu 
services, and the related equipment that performs these functions, 
would [have] seriously undermined the accessibility and usability of 
telecommunications services required by sections 255 and 251(a)(2).'' 
Similarly, we seek comment on whether the exclusion of video mail from 
our rules governing section 716 would hinder our ability to ensure the 
accessibility and usability of advanced communications services.
    43. TIA also asserts, similar to the argument that it made with 
respect to the scope of VoIP services covered under the CVAA, that 
``products that offer a video connection that is incidental to the 
principal purpose and nature of the end user offering fall outside the 
definition as well,'' we believe the same analysis that we propose to 
apply to the scope of non-interconnected VoIP should apply here. We 
therefore propose to classify any offering that meets the criteria of 
the statutory definition set forth above as a ``video conferencing 
service'' and note that the statutory definition does not exclude 
``products that offer a video connection that is incidental to the 
principal purpose and nature of the end user offering.'' Again, we note 
that this issue may be relevant to our waiver authority set forth in 
section 716(h), or the exclusion of customized equipment or services 
pursuant to section 716(i). We seek comment on this proposed 
classification.
ii. Interoperable
    44. We seek further comment on the meaning of ``interoperable'' in 
the term ``interoperable video conferencing service,'' again noting the 
symmetries of the definition and interpretation of this term in the 
various drafts of the CVAA and the legislative history of this law. 
Commenters appear to be divided on the significance of this term. ITI 
asserts that the inclusion of the modifier ``interoperable'' after 
earlier versions of the legislation did not include the word ``strongly 
suggests that Congress consciously decided to target only a subset of 
all video conferencing services.'' TIA urges an interpretation of the 
word ``interoperable'' to mean that a video conferencing service must 
operate ``inter-platform, inter-network, and inter-provider'' before it 
is subject to the accessibility provisions of the CVAA. Similarly, CEA 
concludes that ``most nascent two-way video services and applications 
commercially available in the marketplace have not yet reached true 
interoperability and are not covered by the statute.'' However, 
Consumer Groups believe that ``interoperable'' should be interpreted to 
achieve a broad application of the requirements of the CVAA. Similarly, 
the RERC-IT urges that the inclusion of the word ``interoperable'' 
suggests a broad application of the CVAA so that ``all video 
conferencing services are covered and that they should be made 
interoperable.'' Other commenters express concerns about the current 
lack of interoperability of video conferencing services, i.e., that 
consumers are not able to make point-to-point calls using different 
video conferencing programs.
    45. We are concerned that limiting coverage of this provision to 
only currently available video conferencing services that are ``inter-
platform, inter-network, and inter-provider'' may undermine the 
statute's intent to the extent the definition results in little or no 
video conferencing service or equipment being ``interoperable.'' We 
note that ``video conferencing service'' in the legislative history and 
``interoperable video conferencing service'' in the statute have the 
exact same definitions.
    46. We seek comment on how to define ``interoperable'' in a manner 
that is faithful to both the statutory language and the broader 
purposes of the CVAA. Specifically, we seek comment on how the 
Commission should define interoperable video conferencing services 
within the scope of covered services to ensure that ``such services 
may, by themselves, be accessibility solutions'' and ``that individuals 
with disabilities are able to access and control these services'' as 
Congress intended. For example, which characteristics of video 
conferencing services and equipment, including software, should 
determine ``interoperability''?
    47. The Commission requires VRS services and equipment to be 
``interoperable'' for the provision of VRS under section 225 of the 
Act. The Commission also requires video conferencing services and 
equipment used for point-to-point calls between VRS equipment users to 
be ``interoperable'' under the authority of ancillary jurisdiction. 
These interoperability requirements pertain only to VRS providers and 
equipment used by registered VRS users for VRS and point-to-point 
communications and do not require interoperability among VRS and other 
platforms, networks, or providers. We seek comment on whether how we 
define interoperability in the context of VRS should have any bearing 
on how we define ``interoperable'' in the term ``interoperable video 
conferencing service.''
5. Customized Equipment or Services
    48. Section 716(i) states that the provisions of this section 
``shall not apply to customized equipment or services that are not 
offered directly to the public, or to such classes of users as to be 
effectively available directly to the public, regardless of the 
facilities used.'' While the Senate Report did not discuss this 
provision, the House Report explains that section 716(i) is a ``narrow

[[Page 13807]]

exemption'' that encompasses ``equipment and services [that] are 
customized to the unique specifications requested by an enterprise 
customer.'' It goes on to state that this provision ``permit[s] 
manufacturers and service providers to respond to requests from 
businesses that require specialized and sometimes innovative equipment 
to provide their services efficiently'' and is ``not intended to create 
an exemption for equipment and services designed for and used by 
members of the general public.''
    49. Several other commenters urge us to find that manufacturers and 
service providers are subject to Section 716 only to the extent that 
they are offering their equipment and services directly to the public. 
In contrast, the RERC-IT urges us to ``carefully limit the exception 
for customized equipment and services'' and to cover equipment and 
services that have been customized in ``minor ways'' and ``that are 
made available to the public indirectly through employers, schools, or 
other institutions.'' The RERC-IT also urges that we define ``public'' 
in this context to ``include public institutions, such as educational 
institutions and government agencies.''
    50. We believe that the guidance offered by the House Report 
evinces Congress's intent that section 716(i) be narrow in scope and 
applicable only to customized equipment and services offered to 
business or other enterprise customers, rather than to equipment and 
services ``used by members of the general public.'' We seek comment on 
this analysis, as well as on the extent to which the equipment and 
services used by private institutions but made available to the public, 
such as communications equipment and services used by libraries and 
schools, should be covered by the CVAA. More specifically, we seek 
comment on what additional guidance by the Commission is needed to 
define equipment and services that are ``used by members of the general 
public.'' Finally, we seek comment on the extent to which section 716 
covers products and services that are offered to the general public, 
but which have been customized in minor ways to meet the needs of 
private entities.
    51. Consistent with Motorola's assertions, we propose to find 
section 716's definition of advanced communications services not to 
extend to public safety communications networks and devices and find 
that these networks and devices are ``equipment and services that are 
not offered directly to the public.'' We agree that the Commission's 
recent proposal not to apply its hearing aid compatibility requirements 
to public safety equipment is instructive here. We note, however, that 
employers still have obligations under the ADA, and agree with CSD that 
``to the extent possible, public safety systems should be designed to 
accommodate the needs of deaf [and] hard-of-hearing employees and 
employees with other disabilities.'' We seek comment on this analysis.
6. Waivers for Services or Equipment Designed for Purposes Other Than 
Using ACS
    52. Section 716(h)(1) of the Act states: The Commission shall have 
the authority, on its own motion or in response to a petition by a 
manufacturer or provider of [ACS] or any interested party, to waive the 
requirements of [section 716] for any feature or function of equipment 
used to provide or access [ACS], or for any class of such equipment, 
for any provider of [ACS], or for any class of such services that --(A) 
is capable of accessing an [ACS]; and (B) is designed for multiple 
purposes but is designed primarily for purposes other than using [ACS]. 
We note that, in making waiver decisions, the Commission generally 
considers whether special circumstances exist that warrant deviation 
from the general rule, and whether the waiver will serve the public 
interest. In the October public notice, the Bureaus asked what factors 
would be relevant to determining whether a product or service is 
eligible for a waiver and whether there are any specific classes of 
products or services that warrant the establishment of a categorical or 
blanket waiver.
    53. Both the Senate and House Reports state that section 716(h) 
``provides the Commission with the flexibility to waive the 
accessibility requirements for any feature or function of a device that 
is capable of accessing advanced communications services but is, in the 
judgment of the Commission, designed primarily for purposes other than 
accessing advanced communications.'' Consistent with the statutory 
language and legislative history, we propose to focus our inquiry on 
determining whether the offering is designed primarily for purposes 
other than using ACS.
    54. In making our waiver assessment, we agree with commenters that 
the ``core'' function of an offering is an issue relevant to our 
analysis, we also agree with the IT and Telecom RERCs's suggestion that 
the ``primary feature of a multi-feature device or service [may] vary 
from person to person.'' Furthermore, we do not believe the fact that a 
``core'' function of a device is to play games to be dispositive of the 
issue whether such device is entitled to waiver under section 716(h). 
As the IT and Telecom RERCs note, ``[g]aming is used for education, 
rehabilitation, and social interaction [and] * * * should not be 
exempted simply because the basic feature is a game.'' We seek comment 
on this analysis. We also seek comment on AFB's contentions that ``how 
[a product] is marketed'' and ``[how] most people think of the device'' 
should not be relevant to our analysis; rather, ``[t]he issue is 
whether the advanced communications features and functions can be 
operated apart from the device's [primary] functions.''
    55. ESA also suggests that why consumers access the gaming products 
is an important consideration: ``Consumers do not play an online game, 
[for example], as a means of accessing chat--a consumer in search of a 
general purpose messaging service will find simpler, more direct 
alternatives than navigating through the various features of a gaming 
device or online game service.'' We seek comment on this assertion and 
on whether how consumers actually use the communications component of a 
multi-purpose device or service is relevant to our assessment of the 
primary purpose for which a device or service was designed. In 
addition, we seek comment on ESA's proposal that we consider as part of 
our waiver determination whether the offering is designed for a 
``specific class of users who are using the ACS features in support of 
another task.''
    56. We also seek comment on the process that we should adopt for 
determining whether to waive the requirements of section 716 and 
specifically on the extent to which we need to adopt any procedures to 
ensure that such process is efficient and effective. Alternatively, we 
seek comment on whether we should handle waivers as we have in the 
normal course pursuant to Sec.  1.3 of the Commission's rules. We agree 
with commenters who state that we should ``incorporate protections for 
confidential information'' and propose that parties seeking waivers be 
able to request confidential treatment of information pursuant to Sec.  
0.459 of the Commission's rules. At the same time, we agree with AAPD 
that, to the extent possible, the process should be ``transparent and 
public,'' and propose to seek comment on any waiver petition that we 
receive pursuant to section 716(h). We seek comment on these proposals.
    57. We also recognize the need, after appropriate consideration, 
for making waiver determinations in an ``expeditious manner,'' although 
we

[[Page 13808]]

propose not to ``incorporate an automatic grant date for waiver 
requests'' as TIA urges. We note that TIA requests that ``if the 
Commission fails to timely act on a good faith waiver request, the 
company in question [should] be able to initiate the product or service 
without penalty, and incorporate accessibility features in a reasonable 
time frame prospectively.'' Given that such a ``deemed granted'' 
provision is not contemplated by the statute, we do not intend to 
propose the framework outlined by TIA. We seek comment on this 
analysis.
    58. In addition, in light of the fact that, as the NFB observes, 
``[t]echnology is ever changing and the `primary purpose' of multi-
purpose products is always evolving,'' we seek comment on AAPD's 
assertion that ``there should be no permanent waivers.'' Should waivers 
be temporary, and, if so, what should the duration of the waivers be? 
If we decide that waivers should only be temporary, should we establish 
a process for renewing waivers, and, if so, should the factors we 
consider for renewal vary from the factors we consider for the original 
waiver grant?
    59. We also seek comment on whether we should consider waivers for 
a ``class'' of services or equipment under this section and what 
specific showing is needed to justify such waivers. Several commenters 
suggest that we should grant blanket waivers in order to support 
innovation and competition. For example, Microsoft states that 
``[g]ranting prospective categorical waivers is essential to encourage 
manufacturers and service providers to build communication features 
into services and equipment devices that do not have as their core 
purpose advanced communications * * * [f]ostering this innovation will 
enrich the communications choices and solutions available to all 
consumers, including those with disabilities.'' In contrast, many 
consumer commenters suggest that blanket waivers are never appropriate, 
given rapid technological advancement and the belief that ``much 
accessibility and usability will be accomplished through software and 
related changes.''
    60. We seek further comment on the specific factors that we should 
consider in determining whether a particular ``class'' of services or 
equipment should be granted a waiver. How can we determine what 
services or equipment are similarly situated enough to be designated a 
``class''? Is it possible to structure a blanket waiver in such a way 
as to address consumers' concerns that any such waiver could quickly 
become outdated? Are there specific classes of services or equipment 
that we should consider waiving in our final rules on section 716? If 
we do decide to grant waivers for an entire class of services or 
equipment, should such waivers be permanent or temporary? As discussed 
above (for individual waivers), should we establish a renewal and/or 
revocation process for categorical waivers?
7. Exemptions for Small Entities
    61. Section 716(h)(2) states that ``the Commission may exempt small 
entities from the requirements of this section.'' While the Senate 
Report did not discuss this provision, the House Report notes that 
under this section, the Commission may ``waive the accessibility 
requirements for certain small businesses and entrepreneurial 
organizations'' because they ``may not have the legal, financial, or 
technical capability to incorporate accessibility features.'' 
Otherwise, the Report notes, the ``application of these requirements in 
this limited case may slow the pace of technological innovation.'' It 
also states that ``the Commission is best suited to evaluate and 
determine which entities may qualify for this exemption,'' and that it 
expects we will consult with the Small Business Administration 
(``SBA'') when defining the small entities to be exempted.
    62. NTCA asks the Commission to exercise its authority under 
section 716(h)(2) to exempt small businesses from section 716 and to 
define ``small businesses,'' as such term is defined in the Regulatory 
Flexibility Act, thereby enabling small, rural local exchange carriers 
(``RLECs'') and their affiliates to deploy and offer ACS ``without 
facing outsized or unachievable regulatory burdens.'' Similarly, 
Blooston Rural Carriers request that small RLECs, RLEC affiliates, and 
other similarly situated small entities be exempted under section 
716(h)(2) from both section 716, and the related enforcement and 
recordkeeping requirements of section 717. In the alternative, they 
request that the Commission adopt ``streamlined procedures and 
simplified criteria'' that make ``appropriate waivers reasonably 
available to qualifying entities in a timely, predictable, and 
economically reasonable manner.''
    63. Consumer Groups, however, urge that ``[i]ndividuals with 
disabilities should not be denied accessible advanced communications 
equipment and services simply because they happen to live in 
underserved or rural areas,'' and assert that ``RLECs can ensure their 
own compliance with the [CVAA] through contracts with larger providers 
and mass market vendors * * * who must also comply with the [CVAA].'' 
ACB opposes small entity waivers ``without such entities having done 
due diligence on whether or not product accessibility is `achievable'* 
* * [contending] a case-by-case approach to granting waivers would 
better serve the needs of consumers.'' Moreover, ACB recommends that, 
if the Commission grants categorical waivers for small entities, any 
such waivers only be granted for a year or less, subject to renewal at 
the Commission's discretion. Similarly, AAPD urges the FCC Commission 
to utilize caution when reviewing circumstances that would allow small 
entities an exemption from these requirements. AAPD does not favor 
``permanent exemptions or waivers.''
    64. In considering the proper scope of possible exemptions from the 
provisions of section 716 for small entities, we note that other 
provisions of that section also recognize the need to consider the 
circumstances of such entities in applying the accessibility 
requirements. As discussed in section III.B.1 infra, section 716 
provides that service providers and manufacturers must meet the 
accessibility requirements of section 716 ``unless [those requirements] 
are not achievable.'' Section 716(g) defines ``achievable'' as ``with 
reasonable effort or expense,'' and requires the Commission to consider 
four factors in determining whether meeting a requirement of section 
716 is ``achievable.'' Two of those four factors necessarily 
incorporate consideration of the size and capabilities of an entity: 
``[t]he technical and economic impact on the operation of the 
manufacturer or provider and on the operation of the specific equipment 
or service in question, including on the development and deployment of 
new communications technologies;'' and ``[t]he type of operations of 
the manufacturer or provider.''
    65. The discretionary authority to exempt one or more groups of 
small entities in section 716(h)(2) supplements the protections that 
are built into the section 716(g) achievability analysis with an 
additional tool to ensure that our rules do not unduly burden such 
entities. We acknowledge that certain small entities may lack the 
legal, financial, or technical capability to incorporate the 
accessibility features required by the CVAA, and that in certain 
instances this may warrant an exemption from our accessibility 
requirements for certain small entities that provide ACS as well as 
some of those small entities that manufacture equipment used for ACS.

[[Page 13809]]

We agree with consumers that any such exemptions should be carefully 
tailored to ensure that individuals with disabilities are not denied 
access to advanced communications equipment and services in rural and 
other underserved areas.
    66. In light of these competing concerns, we seek comment on 
whether we should exercise our exemption authority, and if so, how we 
should structure the exemption. For example, should we base the 
exemption on the number of employees or the annual revenues of the 
entity or a combination of the two? Are there other criteria that we 
should consider? We also seek input on the impact of any exemption that 
commenters urge us to make. In particular, we request information on 
the percentage of manufacturers and service providers that would be 
exempted from our section 716 requirements for any specific criteria 
proposed. We also seek comment on the percentage of equipment 
(including software) and services in the ACS marketplace that would be 
exempted from the requirements of section 716 if we exempted entities 
based these proposed criteria. In addition, we seek comment on how use 
of any recommended criteria would affect the availability of ACS and 
equipment used for ACS, especially in rural and underserved areas. 
Finally, if we adopt criteria to exempt small entities, should we 
consider limiting the time period of any exemption that may be granted 
under these criteria? We also propose to review periodically any basis 
that we adopt for granting exemptions to small entities to ensure that 
they reflect the current state of the industry.

B. Nature of Statutory Requirements

1. Achievable Standard
a. General Approach
    67. Service providers and manufacturers must meet the accessibility 
requirements of section 716 ``unless [those requirements] are not 
achievable.'' Section 716(g) of the Act defines the term ``achievable'' 
to mean ``with reasonable effort or expense, as determined by the 
Commission.'' As noted above, section 716 requires a higher standard of 
achievement than section 255. Under section 255, covered entities must 
ensure the accessibility of their products if it is ``readily 
achievable'' to do so, which the statute defines by cross reference to 
the ADA to mean ``easily accomplishable and able to be carried out 
without much difficulty or expense.''
    68. Specifically, section 716(g) requires the Commission to 
consider the following factors in making determinations about what 
``constitutes reasonable effort or expense'': (1) The nature and cost 
of the steps needed to meet the requirements of this [s]ection with 
respect to the specific equipment or service in question; (2) the 
technical and economic impact on the operation of the manufacturer or 
provider and on the operation of the specific equipment or service in 
question, including on the development and deployment of new 
communications technologies; (3) the type of operations of the 
manufacturer or provider; and (4) the extent to which the service 
provider or manufacturer in question offers accessible services or 
equipment containing varying degrees of functionality and features, and 
offered at differing price points.
    69. We seek comment on each of these factors. At the outset, we 
note that the Senate and House Reports state that we should ``weigh 
each factor equally when making an achievability determination.'' The 
House Report also states that in implementing section 716, the 
Commission should ``afford manufacturers and service providers as much 
flexibility as possible, so long as each does everything that is 
achievable in accordance with the achievability factors.'' Consistent 
with this legislative history, we generally agree with AT&T that an 
assessment of what is achievable should be ``fact-based, flexible, and 
applied on a case-by-case basis,'' but also agree with NFB that 
flexibility should not be so paramount that ``accessibility is never 
achieved.'' The House Report also states that ``the Commission [should] 
interpret the accessibility requirements in this provision the same way 
as it did for [s]ection 255, such that if the inclusion of a feature in 
a product or service results in a fundamental alteration of that 
service that it is per se not achievable to include that function.'' 
Accordingly, we agree with commenters who urge us to interpret the 
achievability requirements consistent with this directive. We seek 
comment on this analysis.
    70. We also seek comment on whether or to what extent we have the 
discretion to weigh other factors not specified in the statute in 
making an achievability determination. ITI urges us to do so, and 
specifically asks us to consider ``how the lack of economies of scale 
and scope can sometimes hinder the development and deployment of 
accessibility solutions.'' We note that Congress specifically set forth 
in section 716 the factors that we must consider in determining whether 
accessibility is achievable, and directed us to weigh these factors 
equally. In light of the statute and this legislative history, we 
propose to only consider the factors enumerated in the statute in 
making our achievability determinations. We would note, however, that 
we propose to construe the factors broadly and weigh any relevant 
considerations in determining their meaning. We believe, for example, 
that the ``lack of economies of scale and scope'' could be a relevant 
consideration in determining the meaning of the second factor, ``the 
technical and economic impact on the operation of the manufacturer or 
provider and on the operation of the specific equipment or service in 
question, including on the development and deployment of new 
communications technologies.'' We seek comment on this analysis.
b. Specific Factors
(i) Nature and Cost of Steps Needed With Respect to Specific Equipment 
or Service
    71. Section 716(g)(1) of the Act states that in determining whether 
the statutory requirements are achievable, the Commission must consider 
``[t]he nature and cost of the steps needed to meet the requirements of 
[716(g)] with respect to the specific equipment or service in 
question.'' The Senate Report requires the Commission to consider ``the 
nature and cost of the steps needed to make the specific equipment or 
service in question accessible'' and states that ``[t]he Committee 
intends for the Commission to consider how such steps, if required, 
would impact the specific equipment or service in question.'' The House 
Report reiterates the need for the Commission to focus on the 
``specific product or service in question'' when conducting this 
analysis. We believe that it is appropriate for us to consider whether 
accessibility has been achieved by competing products, but agree with 
T-Mobile that, in doing so, we must also consider the unique 
circumstances of each covered entity. We seek comments on this analysis 
and also seek comment on whether we should define this standard with 
more specificity in order to make sure that our standards are fully 
enforceable. We further request input on ACB's suggestion that we 
consider the totality of the steps that a company needs to take in our 
achievability analysis, as well as the need to compare the cost of 
making a product accessible with the organization's entire budget.
(ii) Technical and Economic Impact on the Operation
    72. The second factor in determining whether compliance with 
section 716 is

[[Page 13810]]

``achievable'' requires the Commission to consider the ``technical and 
economic impact of making a product or service accessible on the 
operations of the manufacturer or provider, and on the operation of the 
specific equipment or service in question, including on the development 
and deployment of new communications technologies.'' We seek comment on 
how we should assess this factor and how our analysis should take into 
account the development and deployment of new communications 
technologies.
(iii) Type of Operations
    73. The third factor in determining whether compliance with section 
716 is ``achievable'' requires the Commission to consider ``[t]he type 
of operations of the manufacturer or provider.'' The Senate and House 
Reports state that this factor permits ``the Commission to consider 
whether the entity offering the product or service has a history of 
offering advanced communications services or equipment or whether the 
entity has just begun to do so.'' We seek comment on the extent to 
which we should consider an entity's status as a new entrant in the ACS 
market in conducting our achievability analysis. How should a 
manufacturer or service provider's recent entry into this market affect 
our analysis if such entity has significant resources or otherwise 
appears capable of achieving accessibility? What other criteria should 
we use in assessing this factor as part of our achievability analysis?
(iv) Extent to Which Offering Has Varied Functions, Features, and 
Prices
    74. The fourth factor in determining whether compliance with 
section 716 is ``achievable'' requires the Commission to consider 
``[t]he extent to which the service provider or manufacturer in 
question offers accessible services or equipment containing varying 
degrees of functionality and features, and offered at differing price 
points.'' The Senate and House Reports state that ``the Commission 
[should] interpret this factor in a similar manner to the way that it 
has implemented its hearing aid compatibility rules.'' The Commission's 
rules governing hearing aid compatibility (``HAC'') obligations for 
wireless devices require manufacturers and service providers to ensure 
that a range of phones comply with the HAC standards. Specifically, 
those rules direct such companies to ensure that hearing aid users are 
able to select ``from a variety of compliant handset models with 
varying features and prices.''
    75. Several industry commenters read Congress's directive to 
incorporate this criteria into the achievability analysis, in 
conjunction with the legislative history and Section 716(j), as an 
outright rejection of the finding in the Section 255 Report and Order 
to require covered entities to consider the accessibility of every 
product. On the other hand, the RERC-IT states that ``if every function 
of a particular device can achievably be made accessible to every 
disability, every function should be made accessible.'' We question 
whether any of these proposed interpretations appropriately take into 
account the more balanced approach contemplated by Congress, which 
gives equal weight to each of the four achievability factors and 
applies them on a flexible, case-by-case basis. We do, however, 
generally agree with TIA that this factor should be interpreted to 
``give individuals with disabilities meaningful choices in accessible 
products, and to reward those companies who provide such choices.'' 
While section 716's flexible approach is not amenable to the fixed 
number or percentage approach the Commission has employed in the HAC 
context, section 716(g)(4) seems to require that where a company has 
made a good faith effort to incorporate accessibility features in 
different products across multiple product lines, this should count 
favorably toward a determination that the company is in compliance with 
section 716 for the product in question. Where companies offer a range 
of accessible products that perform different functions at varied price 
points, consumers with disabilities will have a range of devices from 
which to make their purchases. In those instances, so long as other 
criteria under the achievability analysis are met, a company charged 
with having an inaccessible product might not have to make that 
specific product accessible. This approach would appropriately reward 
companies that make substantial investments in accessible products, 
while allowing flexibility to account for marketplace realities.
    76. Accordingly, we seek comment on whether covered entities 
generally should not have to consider what is achievable with respect 
to every product, if the entity offers consumers with the full range of 
disabilities meaningful choices through a range of accessible products 
with varying degrees of functionality and features, at differing price 
points. At the same time, we also seek comment on whether there are 
some accessibility features that are so important or easy to include 
(like a ``nib'' on the 5 key) that they should be deployed on every 
product, unless it is not achievable to do so. If so, we seek comment 
on whether we should identify in our rules some of these specific 
accessibility features that are currently available, to provide clarity 
on what accessibility features should be universally deployed, if 
achievable. We further express our general belief that section 716(j), 
does not preclude our identifying ``easy'' accessibility features that 
must be included on every product, if achievable. While the Senate 
Report did not address this specific provision, our belief is confirmed 
by the House Report, which states that the Commission's approach to 
section 255 is consistent with section 716(j). Finally, we seek comment 
on whether we should define with more specificity the meaning of 
``varying degrees of functionality and features'' and ``differing price 
points.'' In particular, we seek comment on ACB's assertion that ``[i]t 
is essential that manufacturers and service providers make available a 
range of devices that fit various price ranges along with corresponding 
accessible features * * * this may be accomplished by dividing devices 
into classes and making certain that each class has at least one option 
that is fully accessible.''
2. Industry Flexibility
    77. Sections 716(a)(2) and (b)(2) of the Act provide manufacturers 
and service providers, respectively, flexibility on how to ensure 
compliance with the accessibility requirements of the CVAA. 
Specifically, a manufacturer or service provider may comply with these 
requirements either by building accessibility features into the 
equipment or service or ``by relying on third party applications, 
peripheral devices, software, hardware, or [CPE] that is available to 
consumers at nominal cost and that can be accessed by people with 
disabilities.'' While the Senate Report did not discuss these 
provisions, the House Report makes clear that the choice between these 
two options ``rests solely with the provider or manufacturer.'' We 
believe that the statutory language and legislative history preclude us 
from preferring built-in accessibility over third party accessibility 
solutions, as some consumer commenters urge us to do. We acknowledge 
the integral role that universal design has played in ensuring that 
mainstream products and services are accessible to people with 
disabilities, and we believe that universal design will continue to 
play an important role in providing accessibility to people with 
disabilities. We believe, however, that the industry flexibility 
provisions of the CVAA reflect the fact that there are new ways

[[Page 13811]]

to meet the needs of people with disabilities that were not envisioned 
when Congress passed section 255, which relied primarily on universal 
design principles. With new and innovative technologies, in some cases, 
personalized services and products may now be able to more efficiently 
and effectively meet individual needs than products built to perform in 
the same way for every person. Sometimes called ``auto-
personalization,'' where available, this allows devices to adapt to 
individual needs based on the user's preferences, according to the 
device's capabilities. In a growing and increasingly mobile computing 
environment, for example, consumers may be able to set their 
preferences so that the interfaces on a device or the content produced 
by that device automatically become accessible for that individual's 
disability needs.
    78. We do, however, seek comment on what actions we should take to 
ensure that third party accessibility solutions meet the needs of 
consumers in a manner comparable to solutions that are built into the 
equipment. First, we seek comment on the meaning of the requirement 
that the third party accessibility solutions ``must be available to the 
consumer at nominal cost.'' Some commenters assert that ``nominal 
cost'' cannot be a static definition or constitute a set amount or 
percentage of total cost, but rather should be determined on a case-by-
case basis. In contrast, the RERC-IT, noting that people with 
disabilities are ``poor at alarming rates,'' urges the Commission to 
limit ``nominal cost'' at to one percent (1%) of the total cost of the 
device or service, or the total cost of the device plus service, as 
applicable. AFB notes further that ongoing costs to keep third party 
software and hardware up to date and in good working order should be 
included, such that the total cost to the consumer cannot be more than 
nominal. While Congress did not prescribe a percentage or amount, it 
did intend that any fee for third-party software or hardware 
accessibility solutions be ``small enough so as to generally not be a 
factor in the consumer's decision to acquire a product or service that 
the consumer otherwise desires.'' We propose to adopt this definition 
of ``nominal cost'' and seek comment on this proposed definition. We 
are concerned, however, that this definition, by itself, might not 
ensure that the cost of accessibility for the consumer is truly 
nominal, and we seek comment on whether we need to provide further 
guidance on the issue.
    79. We believe that manufacturers and service providers can rely on 
a range of third party solutions, subject to the requirements that we 
discuss further below, including the use of third party applications, 
peripheral devices, software, hardware, and CPE. We propose to adopt 
the following definitions of these potential third party accessibility 
solutions:

    (a) ``Applications'' means ``computer software designed to 
perform or to help the user perform a specific task or specific 
tasks, such as communicating by voice, electronic text messaging, or 
video conferencing'';
    (b) ``Peripheral devices'' means ``devices employed in 
connection with equipment covered by this [proceeding] to translate, 
enhance, or otherwise transfer advanced communications services into 
a form accessible to individuals with disabilities'';
    (c) ``Software'' means ``computer programs, procedures, rules, 
and related data and documentation that direct the use and operation 
of a computer or a related device and instruct it to perform a given 
task or function'';
    (d) ``Hardware'' means ``a tangible communications device, 
equipment, or physical component of communications technology, 
including peripheral devices, such as a smart phone, a laptop 
computer, a desk top computer, a screen, a keyboard, a speaker, or 
an amplifier''; and
    (e) ``Customer premises equipment'' means ``equipment employed 
on the premises of a person (other than a carrier) to originate, 
route, or terminate telecommunications.''

    We seek comment on these definitions and whether they are 
sufficiently inclusive of third party solutions available to 
manufacturers and service providers.
    80. Second, we seek comment on the requirement that individuals 
with disabilities must be able to ``access'' the third-party solutions. 
Specifically, we seek comment on ACB's assertions that the third party 
solutions (i) ``cannot be an after-market sale for which the user must 
perform additional steps to obtain;'' (ii) ``must be fully operable by 
a person with a disability without having to turn to people without 
disabilities in order to perform setup or maintenance;'' and (iii) 
``must be fully documented and supported.'' We believe that for covered 
entities to meet the ``access'' requirement of this provision, they 
must ensure that the third party solution not be more burdensome to a 
consumer than a built-in solution. In that vein, should a service 
provider or manufacturer relying on third party solutions be 
responsible for finding and installing the solution, and supporting the 
solution over the life of the product? We seek comment on this 
analysis, on what a company must do to achieve such parity with built-
in solutions, and on whether it is necessary to require that covered 
entities bundle the third party solutions with its products in order to 
meet the requirements of the statute.
3. Accessible to and Usable by
    81. Under sections 716(a) and (b) of the Act, covered service 
providers and equipment manufacturers must make their products 
``accessible to and usable by'' people with disabilities, unless it is 
not achievable. In this section, we seek comment on the extent to which 
we should continue to define ``accessible to and usable by'' as we have 
for our implementation of section 255, which requires 
telecommunications service providers and equipment manufacturers to 
make their products ``accessible to and usable by'' people with 
disabilities, if readily achievable.
    82. In the Section 255 Report and Order, the Commission adopted a 
definition of ``accessible'' in Sec.  6.3(a) of the Commission's rules 
which incorporated the functional definition of this term from the 
Access Board guidelines and includes various input, control, and 
mechanical functions, output, display, and control functions. The 
Section 255 Report and Order also adopted a definition of ``usable'' in 
Sec.  6.3 that incorporated the Access Board's definition of this term. 
Specifically, Sec.  6.3(l) provides that usable ``mean[s] that 
individuals with disabilities have access to the full functionality and 
documentation for the product, including instructions, product 
information (including accessible feature information), documentation, 
and technical support functionally equivalent to that provided to 
individuals without disabilities.''
    83. We seek comment on whether we should adopt these definitions 
for purposes of section 716 or whether we should take this opportunity 
to make changes to these definitions that would apply to both our 
section 255 of the Communications Act and our section 716 of the CVAA 
based on the Access Board Draft Guidelines that were released for 
public comment in March 2010. While we note that there is a great deal 
of overlap between section 255's definition of ``accessible'' and the 
Access Board's proposed updated functional criteria for ICT, there are 
some differences. To the extent that there are differences between 
these definitions and criteria, should we work to reconcile those 
differences? For example, the rules implementing section 255 of the Act 
address cognitive disabilities whereas the draft ICT guidelines do not; 
and the draft ICT guidelines address photosensitive seizures, whereas 
the rules implementing section 255 of the Act do not. In addition, we 
note that the Access

[[Page 13812]]

Board Draft Guidelines on ``usability'' are broader and more detailed 
than the rules implementing section 255 of the Act. The Access Board 
Draft Guidelines, for example, cover training and alternate methods of 
communication.
4. Disability
    84. Section 3(18) of the Act states that the term ``disability'' 
has the meaning given such term under section 3 of the ADA. The ADA 
defines ``disability'' as with respect to an individual: ``(A) A 
physical or mental impairment that substantially limits one or more 
major life activities of such individual; (B) a record of such an 
impairment; or (C) being regarded as having such an impairment * * *.'' 
Our current rules incorporate this definition of disability, and we 
propose to use that definition in our section 716 rules.
5. Compatibility
    85. Under section 716(c) of the Act, whenever accessibility is not 
achievable either by building in access features or using third party 
accessibility solutions as set forth in sections 716(a) and (b), a 
manufacturer or service provider must ``ensure that its equipment or 
service is compatible with existing peripheral devices or specialized 
customer premises equipment commonly used by individuals with 
disabilities to achieve access,'' unless that is not achievable. 
Section 255 of the Act contains a similar compatibility requirement for 
telecommunications service providers and manufacturers if it is readily 
achievable to do so, in cases where built-in accessibility is not 
readily achievable.
    86. Our rules implementing section 255 of the Act define peripheral 
devices to mean ``devices employed in connection with equipment covered 
by this part to translate, enhance or otherwise transform 
telecommunications into a form accessible to individuals with 
disabilities.'' We stated in the Section 255 Report and Order that 
these might include ``audio amplifiers, ring signal lights, some TTYs, 
refreshable Braille translators, [and] text-to-speech synthesizers.'' 
Our rules implementing section 255 of the Act define specialized CPE as 
customer premises equipment that is commonly used by individuals with 
disabilities to achieve access.
    87. For purposes of section 716, we propose to define peripheral 
devices to mean ``devices employed in connection with equipment, 
including software, covered under this part to translate, enhance, or 
otherwise transform advanced communications services into a form 
accessible to individuals with disabilities.'' This definition is based 
on our section 255 definition, with some refinements to reflect the 
statutory language in section 716. We also propose to define 
specialized CPE, as we do in our rules implementing section 255 of the 
Act, as ``customer premises equipment which is commonly used by 
individuals with disabilities to achieve access.'' We agree with the 
vast majority of commenters that peripheral devices can include 
mainstream devices and software, as long as they can be used to 
``translate, enhance, or otherwise transform advanced communications 
services into a form accessible to individuals with disabilities'' and 
the devices and software are ``commonly used by individuals with 
disabilities to achieve access.'' As we found in the Section 255 Report 
and Order, we do not believe that it would be feasible for the 
Commission to maintain a list of peripheral devices and specialized CPE 
commonly used by individuals with disabilities, given how quickly 
technology is evolving. For the same reason, we also believe that 
covered entities do not have a duty to maintain a list of all 
peripheral devices and specialized CPE used by people with 
disabilities. We do believe, however, that covered entities have an 
ongoing duty to consider how to make their products compatible with the 
software and hardware components and devices that people with 
disabilities use to achieve access and to include this information in 
their records required under section 717(a)(5). We seek comment on 
these proposed definitions.
    88. We also seek additional comment on what should be required to 
ensure compatibility in the context of advanced communications 
services. Under our rules implementing section 255 of the Act, we use 
four criteria for determining compatibility: (i) External access to all 
information and control mechanisms; (ii) existence of a connection 
point for external audio processing devices; (iii) TTY connectability; 
and (iv) TTY signal compatibility. We seek comment on whether the four 
criteria listed above remain relevant in the context of advanced 
communications services. For example, we understand that a sizeable 
majority of consumers who previously relied on TTYs for communication 
are transitioning to more mainstream forms of text and video 
communications. If we want to encourage an efficient transition, should 
we phase out the third and fourth criteria as compatibility components 
in our section 716 rules? Should we phase out the criteria from our 
rules implementing section 255 of the Act as well? If so, should we 
ensure that these requirements are phased out only after alternative 
forms of communication, such as real-time text, are in place?
    89. While the Access Board Draft Guidelines address compatibility 
primarily with content providers in mind, they may still be helpful in 
defining what ``compatible'' should mean as we update our accessibility 
rules. The Access Board Draft Guidelines define compatibility to be the 
``interaction between assistive technology, other applications, 
content, and the platform,'' as well as the preservation of 
accessibility in alternate formats. We seek further comment on whether 
and how we should use the Access Board Draft Guidelines to help us 
define compatibility for purposes of section 716.
    90. We also seek comment on whether we should adopt additional 
criteria for determining compatibility under section 716 and section 
255. The Access Board Draft Guidelines note that accessibility 
programming interfaces (``APIs'') enable interoperability with 
assistive technology. Code Factory explains, for example, that it is 
better able to develop a screen reader application if ``manufacturers 
and operating system developers develop an Accessibility API, which is 
essentially a layer between the device user interface and the screen 
reader that can be used to pull information that must be spoken to the 
user.'' The Access Board Draft Guidelines direct platforms, 
applications, and interactive content to comply with World Wide Web 
Consortium's Web Content Accessibility Guidelines (WCAG) 2.0 Level AA 
Success Criteria and Conformance Requirements or to comply with 
specific accessibility criteria in Chapter 4 of the Access Board Draft 
Guidelines. Are there aspects of the WCAG guidelines or Access Board 
criteria that we should incorporate into our definition of 
compatibility? We also seek comment on the status of industry 
development of APIs and whether incorporating criteria related to APIs 
into our definition of compatibility could promote the development of 
APIs.
6. Network Features
    91. Under section 716(d) of the Act, ``[e]ach provider of advanced 
communications services has the duty not to install network features, 
functions, or capabilities that impede accessibility or usability.'' In 
the October public notice, the Bureaus sought comment on how this 
provision compares to a similar provision in section 251(a)(2) of the 
Act (relating to section 255) and whether the

[[Page 13813]]

requirement has a different meaning in the context of advanced 
communications services networks.
    92. We agree with commenters who generally believe that this duty 
not to impede accessibility is comparable to the duty set forth in 
section 251(a)(2) of the Act. We propose that our rules should include 
the requirements set forth in section 716(d), just as our rules 
implementing section 255 of the Act reflect the language in section 
251(a)(2). We also agree with Verizon and AAPD, who stress that section 
716(d) applies to a much broader range of providers, and seek comment 
on how we can best reach out to newly covered entities and ensure that 
they are aware of their new responsibilities.
    93. We note that both the Senate and House Reports state that the 
obligations imposed by section 716(d) ``apply where the accessibility 
or usability of advanced communications services were incorporated in 
accordance with recognized industry standards.'' CTIA states that until 
the Commission identifies and requires the use of industry-recognized 
standards, it should ``refrain from enforcing these obligations on 
network providers.'' We seek comment on CTIA's assertion and on what 
industry standards currently exist that can be used to incorporate 
accessibility or usability in advanced communications services. We also 
seek comment on what, if any, industry standards should be developed to 
incorporate accessibility or usability in advanced communications 
services and how these standards should be developed.
    94. In addition, we seek comment on assertions by the RERC-IT that 
our rules should prohibit ``passive inaction or setting of options * * 
* that impede access.'' We also seek comment on AFB's statement that 
under this provision ``digital rights management or network security 
features or functions must * * * be installed so as not to impede 
accessibility.'' Finally, we seek comment on CTIA's assertion that 
``any rules seeking to limit the incorporation of any network features 
or functions recognize the need for covered entities to manage all 
network traffic, including advanced communications services.''
7. Accessibility of Information Content
    95. Section 716(e)(1)(B) of the Act states that the Commission's 
regulations shall ``provide that advanced communications services, the 
equipment used for advanced communications services, and networks used 
to provide [such services] may not impair or impede the accessibility 
of information content when accessibility has been incorporated into 
that content for transmission through [such services, equipment or 
networks].'' In the October public notice, the Bureaus sought comment 
on how this provision should be implemented and the types and nature of 
information content that should be addressed. We note that the 
legislative history of the CVAA makes clear that the requirements apply 
``where the accessibility of such content has been incorporated in 
accordance with recognized industry standards.''
    96. We seek further comment on what these standards should be and 
how they should be developed and reflected in the Commission's rules, 
subject to the limitation on mandating technical standards in section 
716(1)(D). In particular, we seek comment on the RERC-IT proposal that 
our regulations need to ensure that (i) ``the accessibility information 
(e.g., captions or descriptions) are not stripped off when information 
is transitioned from one medium to another;'' (ii) ``parallel and 
associated media channels are not disconnected or blocked;'' and (iii) 
``consumers * * * have the ability to combine text, video, and audio 
streaming from different origins.'' We also seek comment on how we can 
best ensure that encryption and other security measures do not thwart 
accessibility, while at the same time ensuring that we ``promot[e] 
network security, reliability, and survivability in broadband 
networks.''
    97. We also note that the Access Board Draft Guidelines require 
content, which includes ``information and sensory experience 
communicated to the user and encoding that defines the structure, 
presentation, and interactions associated with those elements'' to be 
accessible. The Draft Guidelines provide text, images, sounds, videos, 
controls, and animations as examples of content and encourage, as a 
best practice, the maximization of compatibility of content with 
existing and future technologies, including assistive technology. The 
Draft Guidelines also require user interfaces and their functions to be 
accessible. For example, under these Draft Guidelines, advanced 
communications services, equipment, and networks cannot strip captions 
that make content accessible to people who are deaf or hard of hearing 
from content that provides closed captioning. We seek comment on 
whether all or some of these Draft Guidelines would be appropriate for 
industry-recognized standards or inclusion in the Commission's rules.
    98. Finally, we agree with CEA that, consistent with the 
legislation's liability limitations, that manufacturers and service 
providers are not liable for content or embedded accessibility content 
(such as captioning or video description) that they do not create or 
control. We seek comment on this assessment.

IV. Implementation Requirements

A. Obligations

    99. Section 716(e)(1)(C) of the Act requires the Commission to 
``determine the obligations * * * of manufacturers, service providers, 
and providers of applications or services accessed over service 
provider networks.'' Below, we seek comment and make proposals relating 
to the obligations of manufacturers and service providers and ask 
further questions about the obligations of providers of applications or 
services accessed over service provider networks.
1. Manufacturers and Service Providers
    100. With respect to equipment manufacturers and service providers 
of ACS, we propose to adopt general obligations that mirror the 
language of the statute, similar to the approach taken in Sec. Sec.  
6.5 and 7.5 of our rules and section 255 of the Communications Act. 
Specifically, we propose that the Commission's rules set forth the 
following ``General Obligations'':
    [cir] With respect to equipment manufactured after the effective 
date of the regulations, a manufacturer of equipment used for advanced 
communications services, including end user equipment, network 
equipment, and software, must ensure that the equipment and software 
that such manufacturer offers for sale or otherwise distributes in 
interstate commerce shall be accessible to and usable by individuals 
with disabilities, unless such requirements are not achievable.
    [cir] With respect to services provided after the effective date of 
the regulations, a provider of advanced communications services must 
ensure that services offered by such provider in or affecting 
interstate commerce are accessible to and usable by individuals with 
disabilities, unless such requirements are not achievable.
    [cir] If accessibility is not achievable either by building it in 
or using third party accessibility solutions, then a manufacturer or 
service provider shall ensure that its equipment or service is 
compatible with existing peripheral devices or specialized customer 
premises equipment commonly used by individuals with disabilities to 
achieve access unless such compatibility is not achievable.
    [cir] Providers of advanced communications services shall not

[[Page 13814]]

install network features, functions, or capabilities that impede 
accessibility or usability.
    [cir] Advanced communications services and the equipment and 
networks used to provide such services may not impair or impede the 
accessibility of information content when accessibility has been 
incorporated into that content for transmission through such services, 
equipment or networks.
    101. In addition, we propose to adopt requirements similar to those 
in our rules implementing section 255 of the Act regarding product 
design, development, and evaluation (Sec. Sec.  6.7 and 7.7); 
information pass through (Sec. Sec.  6.9 and 7.9); and information, 
documentation and training (Sec. Sec.  6.11 and 7.11), modified to 
reflect the statutory requirements of section 716. Consistent with the 
Section 255 Report and Order, we find that adoption of the functional 
approach reflected in such requirements will provide clear guidance to 
covered entities regarding their obligation to ensure accessibility and 
usability. Some key requirements of these proposed rules include the 
following:
    [cir] Manufacturers and service providers must consider performance 
objectives at the design stage as early and as consistently as possible 
and must implement such evaluation to the extent that it is achievable.
    [cir] Manufacturers and service providers must identify barriers to 
accessibility and usability as part of such evaluation.
    [cir] Equipment used for advanced communications services, 
including end user equipment, network equipment, and software must pass 
through cross-manufacturer, nonproprietary, industry-standard codes, 
translation protocols, formats or other information necessary to 
provide advanced communications services in an accessible format, if 
achievable. Signal compression technologies shall not remove 
information needed for access or shall restore it upon decompression.
    [cir] Such information and documentation includes user guides, 
bills, installation guides for end user devices, and product support 
communications, in alternate formats, as needed. The requirement to 
provide access to information also includes ensuring that individuals 
with disabilities can access, at no extra cost, call centers and 
customer support regarding both the product generally and the 
accessibility features of the product.
    102. We seek comment on these proposed obligations for equipment 
manufacturers and service providers of ACS. In particular, we seek 
comment on whether we should adopt additional obligations or make 
modifications to our proposals.
2. Providers of Applications or Services Accessed Over Service Provider 
Networks
    103. We also seek comment on what, if any, obligations we should 
impose on ``providers of applications or services accessed over service 
provider networks.'' Are there any requirements that we should impose 
on these providers in order to ensure that the statutory mandates of 
section 716 are carried out? We also seek comment on the meaning of 
``accessed over service provider networks.'' How does this apply to 
applications and services that are downloaded and then run as either 
native or web applications on the device? How does this apply to 
applications and services accessed through cloud computing?

B. Performance Objectives

    104. Section 716(e)(1)(A) of the Act provides that in prescribing 
regulations for this section, the Commission shall ``include 
performance objectives to ensure the accessibility, usability, and 
compatibility of advanced communications services and the equipment 
used for advanced communications services by individuals with 
disabilities.'' In the October public notice, the Bureaus sought 
comment on how to interpret this provision, including the extent to 
which these objectives should be specific or general. The October 
public notice also sought comment on the usefulness of the Access 
Board's March 2010 draft standards and guidelines on section 508 of the 
Rehabilitation Act.
    105. We agree with the broad range of commenters who stress the 
importance of having performance objectives that would clearly define 
the outcome needed to be achieved without specifying how these ends 
should be accomplished. More specifically, we agree with those 
commenters who suggest that we incorporate into the performance 
objectives the outcome-oriented definitions of ``accessible,'' 
``compatibility,'' and ``usable'' from Sec. Sec.  6.3 and 7.3 of the 
Commission's rules. We propose to adopt these definitions as 
performance objectives subject to any changes that we make to these 
definitions as part of this proceeding. We also agree with the IT and 
Telecom RERCs that ``performance standards must * * * be testable, 
concrete, and enforceable'' and seek further comment about how we can 
accomplish these objectives. We disagree with ITI's suggestion that 
performance objectives be merely ``aspirational.''
    106. We seek additional comment on whether to adopt more specific 
performance objectives, and on the procedures and timelines that we 
should use to develop these objectives. While as a general matter it 
may be desirable to harmonize the Commission's rules with the Access 
Board Guidelines after the Access Board finalizes its Guidelines, we 
seek comment on what parts of the Access Board Draft Guidelines may be 
useful to us if we develop specific performance objectives in the 
interim. We also seek comment on AT&T's assertion that ``the specific 
functionalities and standards mandated by section 508 [for government 
purchases of technology] * * * may not be appropriate in all 
circumstances for industry wide, mass market application contemplated 
by section 716.'' In which instances would the Access Board standards 
not be appropriate for mass market application? In which areas might 
they be particularly instructive?
    107. We also propose to update our performance objectives, as 
appropriate, after the Emergency Access Advisory Committee (``EAAC''), 
which was established pursuant to section 106 of the CVAA, provides its 
recommendations to the Commission in December 2011. The EAAC, among 
other things, is considering ``what actions are necessary as part of 
the migration to a national Internet protocol-enabled network to 
achieve reliable, interoperable communication transmitted over such 
network that will ensure access to emergency services by individuals 
with disabilities.'' We express our general belief that achieving 
reliable, interoperable communication over IP-enabled networks will 
have applicability outside the emergency access context and may be 
relevant to developing performance objectives under section 716 for 
advanced communications services and equipment used for these services. 
We note as well that the Access Board Draft Guidelines contain a 
proposal for real time text requirements for hardware and software 
whenever real-time voice is supported, further supporting the need to 
move forward with the recommendation in our National Broadband Plan to 
consider a standard for reliable and interoperable real-time text any 
time that VoIP is available and supported.
    108. With respect to interoperable video conferencing services, we 
seek input on what performance objectives or rules need to be 
established to ensure that, where achievable, interoperable

[[Page 13815]]

video conferencing services and equipment are accessible to and usable 
by, individuals with disabilities, such as individuals who are blind, 
have a visual impairment, have limited manual dexterity, or who are 
deaf, hard of hearing, or deaf-blind. We also seek comment on whether 
and to what extent we have the authority to adopt industry-wide 
performance objectives that would set objectives for covered entities 
collectively. We recognize, for example, that no single entity working 
alone, can ensure that video conferencing services (or other advanced 
communications services) are interoperable. If we were to interpret 
section 716 to require interoperability among all video conferencing 
services, what industry-wide performance objectives are needed to 
achieve and ensure such interoperability so that consumers are able to 
make point-to-point calls using different video conferencing services 
and equipment? We also seek comments on what performance objectives are 
needed to address concerns expressed by consumers about the general 
inability of current video conferencing services to connect to VRS in a 
manner that achieves functional equivalency with conventional voice 
telephone services. In this regard, Consumer Groups urge that 
mainstream video conferencing equipment and services be required to 
``comply with standards, such as requisite resolution and frame-rate, 
to support real-time video conferencing used for VRS, remote video 
interpreting, and point-to-point communication.'' We note that the 
Access Board Draft Guidelines on section 508 propose that products used 
to transmit video conversations provide sufficient quality and fluidity 
for real-time video conversation in which at least one party is using a 
visual method of communication, such as sign language.
    109. It appears that video conferencing equipment now available 
off-the-shelf to the general public does not match the capabilities of 
proprietary equipment offered by VRS providers in other ways as well. 
First, although our VRS rules require ten-digit numbering capability on 
VRS-provided video equipment--to enable the owners of such equipment to 
make point-to-point calls to one another--this capability does not 
presently exist in video conferencing equipment such as off-the-shelf 
videophones. Consumer Groups urge that the North American Numbering 
Plan (``NANP'') 10-digit telephone number system be ``adopted and/or 
adapted by [mainstream] video conferencing equipment and service 
providers to make their systems interoperable with other systems and 
users, including VRS users.'' Finally, we note, that while not yet 
universal, Consumer Groups envision multipoint control unit (MCU) 
capability in video conferencing services when VRS is provided so that 
all parties to the call can see the VRS communications assistant and 
each other simultaneously. We therefore seek comment on performance 
objectives for mainstream interoperable video conferencing services and 
equipment to address multiple video conferencing needs by people with 
disabilities, including the need for point-to-point calls where at 
least one party is using a visual method of communication, such as sign 
language; for functionally equivalent VRS; for multi-party conferencing 
via MCUs; for ten-digit numbering (or an alternative means of 
identifying and contacting one another); for effective emergency 
access; and for the delivery of video remote interpreting services.
    110. We also seek comment on whether industry or the Commission 
should establish a working group of diverse stakeholders to address the 
interoperability issues relating to video conferencing services and 
equipment. If so, should the goals be focused on ensuring 
interoperability among the largest service providers and equipment 
manufacturers? How can we ensure that new entrants and software 
application developers would be fully represented in such a process? We 
ask commenters to set forth in detail the goals of such a group, which 
stakeholders should be included, the specific issues that such a 
working group should consider, and a timeline for completion of its 
work. We further ask whether such group should be part of the 
Commission's Consumer Advisory Committee, or be a stand-alone entity. 
Finally, we seek comment on what industry efforts are ongoing to 
address interoperability challenges and the degree to which such 
efforts have been effective.
    111. Finally, we note that the comments to the October public 
notice contain relatively little discussion of ``electronic messaging 
services'' and ``non-interconnected VoIP services.'' We seek further 
comment about the specific accessibility concerns relating to these 
services and whether we should adopt specific performance objectives to 
address these concerns. We also seek comment on whether it would be 
appropriate to establish a working group of diverse stakeholders to 
provide recommendations related to such performance objectives.

V. Industry Guidance

A. Safe Harbors

    112. Section 716(e)(1)(D) of the Act provides that the Commission 
``shall * * * not mandate technical standards, except that the 
Commission may adopt technical standards as a safe harbor for such 
compliance if necessary to facilitate the manufacturers' and service 
providers' compliance'' with the accessibility and compatibility 
requirements in section 716. In the October public notice, we sought 
comment on whether we should adopt safe harbor technical standards.
    113. The vast majority of commenters oppose establishing technical 
standards as safe harbors. CTIA and AT&T assert that safe harbors will 
result in de facto standards being imposed that will limit the 
flexibility of covered entities seeking to provide accessibility. The 
IT and Telecom RERCs state that the Commission's rules should not 
include safe harbors because ``technology, including accessibility 
technology, will develop faster than law can keep up.'' AFB asserts 
that it is too early in the CVAA's implementation ``to make informed 
judgments * * * about whether and which safe harbors should be 
available.'' While ITI supports safe harbors, noting they provide 
clarity and predictability, it warns against using safe harbors ``to 
establish implicit mandates [that] * * * lock in particular 
solutions.'' In light of the concerns raised in the record, we agree 
with AFB that it is too early in the implementation of the CVAA to make 
informed judgments about whether safe harbor technical standards should 
be established. Therefore, we propose not to adopt any technical 
standards as safe harbors at this time. We seek comment on this 
proposal.

B. Prospective Guidelines

    114. Section 716(e)(2) of the Act requires the Commission to issue 
prospective guidelines concerning the new accessibility requirements. 
While the Senate Report did not discuss this provision, the House 
Report notes that such guidance ``makes it easier for industry to gauge 
what is necessary to fulfill the requirements'' by providing industry 
with ``as much certainty as possible regarding how the Commission will 
determine compliance with any new obligations.''
    115. We agree with CTIA that the prospective guidelines that we 
adopt must be clear and understandable and provide service providers 
and manufacturers as much flexibility as possible, so long as 
achievable accessibility requirements are satisfied.

[[Page 13816]]

We seek comment on a proposal by the RERC-IT, endorsed by ACB, that we 
use ``an approach to the guidelines similar to that used by the World 
Wide Web Consortium's Web Content Accessibility Guidelines (WCAG), 
which provide mandatory performance-based standards and non-mandatory 
technology-specific techniques for meeting them.'' We also seek comment 
on whether any parts of the Access Board's Draft Guidelines on section 
508 of the Rehabilitation Act should be adopted as prospective 
guidelines. In addition, we seek comment on the process that should be 
used to develop prospective guidelines and to ensure that a diverse and 
broadly-based group of stakeholders participate in such an effort. 
Should the Commission, for example, establish a consumer-industry 
advisory group to prepare these?

VI. Section 717 Recordkeeping and Enforcement

A. Overview

    116. Section 717(a) of the Act requires the Commission to establish 
new recordkeeping and enforcement procedures for ``manufacturers and 
providers subject to [sections 255, 716, and 718.]'' In the October 
public notice, the Bureaus sought comment on these requirements, 
including the types of records that should be maintained and the 
possible enforcement procedures that should be imposed. We will discuss 
the recordkeeping and enforcement requirements in further detail below, 
including a proposal to amend the existing rules implementing section 
255 of the Act and to add a new rule subpart to implement the 
requirements of section 717. For purposes of our discussion below, we 
propose to apply the section 717 requirements to manufacturers of 
equipment used for telecommunications services, interconnected VoIP, 
voicemail and interactive menu services subject to section 255 of the 
Act; manufacturers of equipment used for ACS subject to section 716; 
and manufacturers of telephones used with public mobile services which 
include an Internet browser, subject to section 718. We also propose to 
apply the section 717 requirements to providers of telecommunications 
services, interconnected VoIP services, voicemail or interactive menu 
services subject to section 255 of the Act; providers of ACS subject to 
section 716; and providers of mobile services who arrange for the 
inclusion of a browser in telephones, subject to section 718. Finally, 
we reiterate our proposal to subject providers of applications and 
services that can be used for ACS and that can be accessed (i.e., 
downloaded or run) by users over other service provider networks to the 
requirements of section 716 and thus by extension cover them under 
section 717. We seek comment on these proposals.

B. Recordkeeping

    117. Beginning one year after the effective date of regulations 
promulgated pursuant to section 716(e), each manufacturer and provider 
subject to sections 255, 716, and 718 must maintain, in the ordinary 
course of business and for a reasonable period, records of the efforts 
taken by such manufacturer or provider to implement sections 255, 716, 
and 718, including: (1) Information about the manufacturer's or 
provider's efforts to consult with individuals with disabilities; (2) 
descriptions of the accessibility features of its products and 
services; and (3) information about the compatibility of such products 
and services with peripheral devices or specialized customer premise 
equipment commonly used by individuals with disabilities to achieve 
access. Section 717 also requires an officer of a manufacturer or 
provider to submit to the Commission an annual certification that 
records are being kept in accordance with this provision. Section 717 
also states that ``[a]fter the filing of a formal or informal complaint 
against a manufacturer or provider, the Commission may request, and 
shall keep confidential, a copy of the records maintained by such 
manufacturer or provider pursuant to [this section] that are directly 
relevant to the equipment or service that is the subject of such 
complaint.'' We seek comment on how to implement these statutory 
requirements and solicit specific input below.
    118. Some commenter urge the Commission to refrain from making the 
recordkeeping requirements overly burdensome, unnecessarily expensive, 
or repetitive of the information required by existing reports. Motorola 
notes that it and some covered entities already publicly provide some 
of the information required by Section 717, including information 
regarding accessibility features, consultations with individuals with 
disabilities, and compatibility with third party peripherals submitted 
in existing Commission reports, such as those required for compliance 
with our HAC rules. CEA also states that ``outreach to individuals with 
disabilities either directly or indirectly through standards 
development organizations'' should be sufficient to demonstrate a 
company's compliance with Section 717's requirement to document efforts 
to consult with individuals with disabilities. Additionally, CEA points 
out that some of the required information may be reflected in 
information provided to the clearinghouse that will be established 
under the CVAA.
    119. We note, however, that section 717 requires the Commission to 
establish uniform recordkeeping and enforcement procedures for entities 
subject to sections 255, 716, and 718. While some of these records that 
section 717 requires to be kept and, potentially, produced may be 
available publicly, in other reports or submissions made to the 
Commission or Bureau, or in information submitted to a clearinghouse, 
most of the information required by this section is not required in 
existing Commission reports and it is not clear to what extent this 
will be available in public information.
    120. While we agree that we should avoid imposing excessive burdens 
or requiring the same information multiple times, we also seek to 
ensure that specific and relevant records required by the statute are 
appropriately maintained by manufacturers and providers. In light of 
the range of potential complaints that may be filed against covered 
entities under the CVAA and section 255, we seek comment on how the 
Commission should effectively implement section 717's recordkeeping 
requirements without imposing excessive burden or expense on covered 
entities or requiring multiple submissions of the same records to the 
Commission.
    121. Section 717 appears to give the Commission the discretion to 
expand the recordkeeping requirements beyond the three categories 
specifically set forth in subsection (a)(5)(A) to ``records of the 
efforts taken by such manufacturer or provider to implement'' these 
Sections. We seek comment on whether the Commission should require 
covered entities to maintain and, potentially, produce records to 
demonstrate their compliance with the provisions of section 255 and 
similarly structured requirements in section 716. We also seek comment 
on what constitutes a ``reasonable time period'' during which covered 
entities will be required to maintain these records. Should we require 
covered entities to create and maintain records showing their 
compliance with the general obligation requirements as well as the 
requirements of product design, development, and evaluation, 
information pass through, and information, documentation, and training? 
For example, should we

[[Page 13817]]

require covered entities to create and maintain records demonstrating 
the process they have used to assess whether it is achievable to make 
particular products and services accessible and usable by persons with 
disabilities? What kinds of records would be sufficient to demonstrate 
such compliance? We also seek comment on whether the Commission should 
require these or any other types of records to demonstrate covered 
entities' compliance with section 255.
    122. Many comments on the recordkeeping requirement request that 
the Commission adopt a flexible approach to section 717's recordkeeping 
requirement that recognizes the differences in size and scope of 
covered entities and their communications services or manufacturing 
operations, instead of requiring a specific form of documentation. 
Verizon recommends that the Alliance for Telecommunications Industry 
Solutions (ATIS) or a similar organization develop a standard 
recordkeeping form that could be used to satisfy this requirement. 
While ATIS, on behalf of AISP.4-HAC, expresses a preference for 
flexible recordkeeping requirements, ATIS also supports Verizon's 
suggestion that industry and consumers should work together to develop 
a mutually agreeable form in the event the Commission decides to adopt 
a standardized approach. CTIA specifically requests that the Commission 
allow records to be kept electronically. TIA suggests that the 
Commission should ``provide some non-exclusive guidance concerning the 
type of information that would be responsive to the statutory 
recordkeeping criteria'' without precluding flexibility in the form in 
which those records may be kept. We seek comment on these 
recommendations.
    123. We recognize that section 717 applies to a broad range of 
entities that have widely ranging business models and modes of 
operation. Therefore, consistent with some commenters' suggestions, we 
propose that we should not mandate any one form in which records must 
be kept in order to comply with section 717. We also propose that if a 
record (that the Commission requires be produced after receipt of a 
complaint) is not readily available, the covered entity must provide it 
no later than the date of its response to the complaint. We seek 
comment on these proposals and on whether there is any reason for the 
Commission to mandate a standard form of recordkeeping to comply with 
section 717(a)(5) or to require covered entities to submit publicly 
available records or those the Commission already has in another report 
or submission. While we cannot predict what the nature of consumers' 
complaints will be or provide specific guidance as to what information 
will be responsive to those complaints, we propose, as discussed more 
fully below, to require each response to a filed complaint to 
sufficiently describe how each record submitted is relevant to the 
complaint and the alleged violation, and how the provided record 
establishes the covered entity's compliance with the Act. Finally, 
given that the statute provides that recordkeeping requirements do not 
take effect until one year after the effective date of regulations 
promulgated pursuant to section 716(e), we seek comment regarding 
whether, and if so, in what fashion, the Commission should address this 
transition period, particularly for the purposes of enforcement.

C. Enforcement

1. Background
    124. Section 717 requires the Commission to adopt rules that 
facilitate the filing of formal and informal complaints that allege a 
violation of section 255, 716, or 718 and to establish procedures for 
enforcement actions by the Commission with respect to such violations, 
within one year of enactment of the law. In this section, we seek 
comment on specific procedures to implement these requirements and 
propose rules to consolidate the existing enforcement provisions for 
section 255 with the newly proposed enforcement rules for alleged 
violations of sections 716 and 718.
a. Enforcement of Section 255
    125. In the rules adopted in the Section 255 Report and Order, the 
Commission provided form and content requirements for informal and 
formal complaints alleging a violation of section 255, as well as 
review and disposition procedures. In particular, the Commission 
established specific elements to be included in any informal complaint 
alleging a violation of section 255 of the Act as well as the form and 
content for answers to such complaints. These rules provide that if the 
Commission determines that an informal complaint has been satisfied 
based on the defendant's answer, or from other communications with the 
parties, the Commission may, at its discretion, consider the informal 
complaint closed, without providing a response to the complainant or 
defendant. Additionally, the Commission may close the informal 
complaint if it determines that no further action is necessary based on 
the complaint and answer, and will then duly inform the complainant and 
the defendant of the reasons stated above. If, however, the Commission, 
based on the pleadings, determines that a material and substantial 
question remains as to a defendant's compliance with the section 255 
requirements and the Commission's implementing rules, the Commission 
may conduct further investigation or proceedings as necessary to 
determine whether the defendant has violated any legal requirements, as 
well as whether any remedial actions and/or sanctions are warranted. If 
the Commission determines that a defendant has failed to comply with 
section 255 and its implementing rules, the Commission can order such 
remedial action or sanctions as are authorized by the Act and the rules 
as it deems appropriate. Aside from its complaint procedures, the 
Commission may, on its own motion, conduct inquiries and initiate 
proceedings as necessary to enforce the relevant requirements.
b. Section 717 Enforcement Requirements
    126. As discussed above, section 717 requires the Commission within 
one year after the date of enactment of the CVAA to establish 
regulations that facilitate the filing of formal and informal 
complaints that allege a violation of section 255, 716, or 718, and to 
establish procedures for enforcement actions.
    127. Specifically, the CVAA requires the Commission to establish 
separate and identifiable electronic, telephonic, and physical 
receptacles for the receipt of complaints filed under section 255, 716 
or 718 as well as establish a process for filing and receiving formal 
or informal complaints. Further, the CVAA requires the Commission to 
investigate the allegations in an informal complaint and, within 180 
days after the date on which such complaint was filed with the 
Commission, issue an order concluding the investigation and provide an 
explanation for its conclusion, unless such complaint is resolved 
before such time. If the Commission determines that a violation has 
occurred, the Commission may, in the order or in a subsequent order, 
direct the manufacturer or service provider to bring the service, or in 
the case of a manufacturer, the next generation of the equipment or 
device, into compliance with requirements of those sections within a 
reasonable time established by the Commission in its order. If a 
determination is made that a violation has not occurred, the Commission 
must provide the basis for

[[Page 13818]]

such determination. The statute also provides that before the 
Commission makes a determination, the party that is the subject of the 
complaint shall have a reasonable opportunity to respond to such 
complaint, and may include in its response any factors that are 
relevant to such determination. Before issuing a final order, the 
Commission is required to provide the responding party a reasonable 
opportunity to comment on any proposed remedial action.
2. General Requirements
    128. Pre-Filing Notice. We seek comment on whether the Commission 
should require potential complainants to first notify the defendant 
manufacturer or provider that it intends to file a complaint based on 
an alleged violation of one or more provisions of section 255, 716, or 
718. We note that some parties have suggested that such a pre-filing 
notice can potentially foster greater communication among parties. 
While we agree that such a requirement could lead to a more efficient 
resolution in advance of a complaint in some instances, we are also 
concerned that in other cases, such a requirement could prove 
burdensome to consumers and delay resolution of complaints. In the 
Section 255 Report and Order, consistent with an Access Board 
recommendation, we encouraged consumers to express their concerns 
informally to the manufacturer or service provider before filing a 
complaint with the Commission. We declined, however, to adopt a rule 
requiring consumers to contact manufacturers and service providers 
before they could file a complaint with the Commission, finding that 
our informal complaint process is ``geared toward cooperative 
efforts.'' We seek comment on whether such an approach is sufficient or 
whether a specific requirement is necessary. To the extent that 
commenters advocate that we require that consumers notify manufacturers 
or providers before they file a complaint, we seek comment on specific 
safeguards that we should adopt to ensure that this requirement does 
not prove onerous to the consumers.
    129. Receipt and Filing of Complaints. We seek comment on how the 
Commission should establish separate and identifiable electronic, 
telephonic, and physical receptacles for the receipt of complaints, 
both formal and informal. We note that the Commission's Disability 
Rights Office has already established a new phone number (202-418-
2517(V); (202-418-2922 (TTY) and e-mail address ([email protected]) for this 
purpose. We also note that currently, informal complaints alleging a 
violation of section 255 may be transmitted to the Commission via any 
reasonable means, e.g., letter, facsimile transmission, telephone 
(voice/TRS/TTY), Internet e-mail, audio-cassette recording, and 
Braille. We propose to retain these vehicles as means for transmission 
and receipt of informal complaints by the Commission under sections 
255, 716 and 718 and ask commenters to consider whether additional 
methods are necessary to meet this statutory requirement. Similarly, as 
discussed more fully below, we seek comment on the extent to which we 
should retain or revise our current requirements under section 255 
governing formal complaints that are filed for alleged violations by 
manufacturers and providers under sections 255, as well as sections 716 
and 718, in the future. At present, these procedures are consistent 
with Sec. Sec.  1.720-1.736 of the Commission's rules. If we make 
changes to facilitate the filing of informal complaints, but continue 
to apply our procedures for formal complaints largely in their current 
form to the new ACS sections (as well as maintain these procedures for 
section 255), will this be enough to fulfill Congress's intent to 
facilitate the filing of complaints under these sections? We note that 
since our rules implementing section 255 of the Act went into effect in 
1999, the Commission has received only three formal complaints alleging 
violations of that section.
    130. Standing to File. We received comments requesting that the 
Commission establish ``reasonable'' standing requirements. We note that 
the CVAA allows ``any person alleging a violation'' of the CVAA or the 
implementing rules to file a formal or informal complaint under section 
255, 716, or 718. Given that there is no standing requirement under 
these sections, and there is no standing requirement under either 
section 208 of the Act and our existing complaint rules, we decline to 
propose a standing requirement and believe the minimum content 
requirements we propose infra in sections VI.C.3 and VI.C.4 will 
effectively deter frivolous complaint filings.
    131. Sua sponte actions by the Commission. As noted above, the 
Commission's implementing rules for section 255 explicitly state that 
the agency may, on its own motion, conduct inquiries and proceedings as 
necessary to enforce the requirements of its implementing rules and 
that section of the Act. We intend for the Commission and its staff to 
continue to investigate and take action on our own motion when 
compliance issues or problems involving sections 255, 716 and 718 come 
to our attention through an accessibility-related complaint or 
otherwise. Rather than establishing specific guidelines for initiating 
investigations and other enforcement actions on the Commission's own 
motion, we propose to continue to follow existing protocols, and use 
procedures that in the opinion of the Commission best serve the 
purposes of Commission- and staff-initiated inquiries and proceedings. 
We seek comment on this approach.
    132. Remedies and Sanctions. We seek comment on what remedies and 
other sanctions the Commission should consider for violations found to 
have occurred under section 255, 716 or 718. As a preliminary matter, 
as noted above, we observe that section 717(a)(3)(B) specifically 
authorizes the Commission to impose as a remedy for any violation an 
order directing a manufacturer to bring the next generation of its 
equipment or device, and a service provider to bring its service, into 
compliance within a reasonable period of time. We also observe that 
section 718(c) envisions that we will continue to use our existing 
enforcement authority under section 503 of the Act, but specifically 
adds that (subject to section 503(b)(5)) manufacturers and service 
providers subject to the requirements of sections 255, 716, and 718 are 
liable for forfeitures of up to $100,000 per violation or each day of a 
continuing violation, with the maximum amount for a continuing 
violation set at $1 million. We intend to use these statutorily 
directed remedies and sanctions as well as other remedies and sanctions 
authorized in the Act. We propose a change to section 1.80 of the 
Commission's rules to reflect the modifications of section 718(c) to 
the Act.
    133. We seek comment on whether there are additional remedies that 
the Commission should consider when a violation is determined to have 
occurred. The Senate and House Reports make clear that we should not 
consider remedies that require retrofitting of equipment, and 
accordingly, we agree with CEA that we should not employ those remedies 
for violations of these provisions. We also note that AFB suggests that 
when a complaint is filed and a given product is not accessible, but 
the company nevertheless offers an array of accessible options, ``the 
Commission should require the company to demonstrate that it can offer 
the complainant at least one other of its products that satisfies the 
[CVAA's] requirements and that would provide the complainant at least 
the same

[[Page 13819]]

features and level of functionality as the product that is the subject 
of the complaint'' and at a comparable cost to the inaccessible 
product. While we agree that this may be a potential defense, we 
clarify that the issue of whether a subject entity satisfies its 
accessibility obligations is a fact-specific determination that will be 
decided in the context of a complaint proceeding based on the record. 
More specifically, we believe our determination about what is 
achievable must take into account all four factors enumerated under 
section 716(g), not just the fourth factor that considers ``the extent 
to which the service provider or manufacturer in question offers 
accessible services or equipment containing varying degrees of 
functionality and features, and offered at differing price points.''
3. Informal Complaints
    134. As described above, within one year after the date of 
enactment of the CVAA, the Commission is required to establish 
regulations that facilitate the filing of an informal complaint that 
alleges a violation of section 255, 716 or 718, as well as establish 
procedures for enforcement actions by the Commission for any 
violations.
    135. We note that commenters suggest that any enforcement 
procedures should provide clarity regarding culpability, given that a 
product or service may potentially involve several different entities 
such as a device manufacturer, a broadband provider, or an application 
developer. We acknowledge that it may be difficult for a consumer to 
determine where the responsibility of one covered entity ends and 
another begins. We seek comment on what additional procedures the 
Commission might adopt to clarify which entity is ``culpable'' for 
noncompliance and further ask to what extent the Commission should be 
available to assist consumers in determining which entities are 
appropriately targeted by specific complaints? We also seek comment on 
what additional elements should be included in complaints that are 
filed under these sections, beyond what is proposed below.
    136. We propose the following minimum requirements that 
complainants should include in their informal complaints, which are 
consistent with section 255 requirements as well as existing 
enforcement rules that have been adopted in other contexts. 
Specifically, we propose to include the following in any informal 
complaint: (1) The name, address, e-mail address and telephone number 
of the complainant, and the manufacturer or service provider defendant 
against whom the complaint is made; (2) a complete statement of facts 
explaining why the complainant contends that the defendant manufacturer 
or provider is in violation of section 255, 716 or 718, including 
details regarding the service or equipment and the relief requested, 
and all documentation that supports the complainant's contention; (3) 
the date or dates on which the complainant or person on whose behalf 
the complaint is being filed either purchased, acquired, or used (or 
attempted to purchase, acquire, or use) the equipment or service about 
which the complaint is being made; (4) the complainant's preferred 
format or method of response to the complaint by the Commission and 
defendant (e.g., letter, facsimile transmission, telephone (voice/TRS/
TTY), Internet e-mail, audio-cassette recording, Braille; or some other 
method that will best accommodate the complainant's disability); and 
(5) any other information that is required by the Commission's 
accessibility complaint form. We seek comment on this proposal and 
request parties to consider what additional or modified requirements 
are necessary. Complaints that do not satisfy the pleading requirements 
will be dismissed without prejudice to refile. (The CVAA requirement 
for the Commission to issue an order concluding an investigation that 
is triggered by informal complaint, within 180 days of the filing 
complaint, will be tied to the Commission's receipt of complaint that 
satisfies its pleading requirements.)
    137. We also recognize that the CVAA's recordkeeping requirements 
will allow the Commission to obtain records of the efforts taken by 
manufacturers or providers to implement sections 255, 716, and 718 and 
the Commission may use these records as necessary to determine whether 
a covered entity has complied with its legal obligations. Additionally, 
consistent with our rules implementing section 255 of the Act, we 
propose to maintain our current rule that the Commission will promptly 
forward any informal complaint meeting the appropriate filing 
requirements to each defendant named or determined to be implicated by 
the complaint. Also, consistent with our approach taken in our rules 
implementing section 255 of the Act, we propose to require 
manufacturers and service providers to establish points of contact for 
complaints and inquiries under section 255, 716 or 718. We continue to 
believe that this requirement will facilitate the ability of consumers 
to contact manufacturers and service providers directly about 
accessibility issues or concerns and ensure prompt and effective 
service of complaints on defendant manufacturers and service providers 
by Commission staff. We seek comment on this proposal.
    138. As discussed above, the CVAA provides a party that is the 
subject of a complaint a reasonable opportunity to respond to such a 
complaint. Consistent with this requirement, we propose that answers to 
informal complaints must: (1) Be filed with the Commission and served 
on the complainant within twenty days of service of the complaint, 
unless the Commission or its staff specifies another time period; (2) 
respond specifically to each material allegation in the complaint; (3) 
set forth the steps taken by the manufacturer or service provider to 
make the product or service accessible and usable; (4) set forth the 
procedures and processes used by the manufacturer or service provider 
to evaluate whether it was achievable to make the product or service 
accessible and usable; (5) set forth the names, titles, and 
responsibilities of each decisionmaker in the evaluation process; (6) 
set forth the manufacturer's basis for determining that it was not 
achievable to make the product or service accessible and usable; (7) 
provide all documents supporting the manufacturer's or service 
provider's conclusion that it was not achievable to make the product or 
service accessible and usable; (8) include a certification by an 
officer of the manufacturer or service provider that it was not 
achievable to make the product or service accessible and usable; (9) 
set forth any claimed defenses; (10) set forth any remedial actions 
already taken or proposed alternative relief without any prejudice to 
any denials or defenses raised; (11) provide any other information or 
materials specified by the Commission as relevant to its consideration 
of the complaint; and (12) be prepared or formatted in the manner 
requested by the Commission and the complainant, unless otherwise 
permitted by the Commission for good cause shown. We seek comment on 
this proposal. We further propose that within ten (10) days after 
service of an answer, unless otherwise directed by the Commission, the 
complainant may file and serve a reply, which shall be responsive to 
matters contained in the answer and shall not contain new matters. We 
seek comment on this proposal as well. Given the statutory requirement 
for the Commission to issue an order concluding an investigation of an

[[Page 13820]]

informal complaint within 180 days of the filing of the complaint, are 
there other pleading requirements we should impose, and, if so, what 
should these be?
    139. As noted above, the CVAA requires the Commission to issue an 
order that finds whether a violation has occurred within the time 
limits required by the Act, and to provide an explanation for its 
conclusion. Also, as we have noted, the statute provides that if the 
Commission determines that a violation has occurred, the Commission may 
direct the manufacturer or service provider to bring the service, or in 
the case of a manufacturer, the next generation of the equipment or 
device, into compliance with requirements of those sections within a 
reasonable time established by the Commission in its order. In 
addition, as also previously mentioned, before issuing a final order, 
the Commission is required to provide the responding party a reasonable 
opportunity to comment on any proposed remedial action. We would 
further note that the CVAA authorizes the Commission to direct 
manufacturers and service providers of ACS to bring their equipment and 
services into compliance either in the order concluding an 
investigation based on an informal complaint or ``in a subsequent 
order.'' Recognizing the importance of the rapid implementation of 
remedies to achieving the CVAA's broader goals, however, we will 
endeavor to issue a determination regarding remedies within 180 days 
after an informal complaint is filed, or shortly thereafter in a 
subsequent order, whenever feasible. (The Commission must, however, 
conclude the investigation and include a determination whether any 
violation occurred within 180 days.) We seek comment on this approach.
    140. We recognize that the Commission must exercise any remedial 
authority selectively and carefully, based on legislative history, 
particularly for consumer and wireless devices, clarifying that ``the 
Commission shall provide [service providers and manufacturers] a 
reasonable time to bring the service or equipment at issue into 
compliance * * * [and should not] require retrofitting of such 
equipment that is already in the market.'' We seek comment on what we 
should consider a reasonable time in which to bring inaccessible 
devices or services into compliance and how best to impose compliance 
in this context consistent with our proposals for remedies and 
sanctions discussed above. We also seek input on what constitutes 
``reasonable opportunity'' to comment on any proposed remedial action.
4. Formal Complaints
    141. Applicability of sections 1.720-1.736. In addition to allowing 
aggrieved parties an opportunity to file informal complaints, section 
717 states that such parties may use our more formal adjudicative 
procedures to pursue accessibility claims against manufacturers or 
service providers under sections 255, 716 and 718. This section further 
directs the Commission to establish regulations that facilitate the 
filing of such formal claims. To date, section 255 claims have been 
subject to the procedures laid out in Sec. Sec.  1.720-1.736 of the 
Commission's rules. Under these rules, both complainants and defendants 
are required to (1) certify in their respective complaints and answers 
that they attempted in good faith to settle the dispute before the 
complaint was filed with the Commission; and (2) submit detailed, 
factual and legal support, accompanied by affidavits and documentation, 
for their respective positions in the initial complaint and answer. The 
rules also place strict limits on the availability of discovery and 
subsequent pleading opportunities to present and defend against claims 
of misconduct. Additionally, the rules include additional procedural 
and pleading requirements designed to expedite resolution of any formal 
complaint. We propose to require aggrieved parties to follow our 
existing formal complaint procedures, as modified in our proposed 
rules. These modifications include deleting references to provisions 
that are not relevant to consumer-filed complaints in the accessibility 
context (e.g., provisions relating to complaints filed under section 
271 of the Act), as well as to ``rocket docket'' procedures. Because 
the CVAA requires the Commission to address informal complaints within 
180 days of filing, and because our accelerated docket procedures were 
designed to adjudicate disputes between carriers that satisfy certain 
criteria, we are inclined not to extend these procedures to formal 
complaints in the accessibility context. We seek comment on whether we 
should consider additional modifications to these rules in order to 
facilitate the filing of such formal complaints.
    142. Additionally, we propose not to require parties to obtain 
Commission approval in order to file a formal complaint; we also 
propose not to require parties to invoke our informal complaint 
processes as a prerequisite to filing a formal complaint. No such 
requirements exist in the statute or our formal complaint rules and we 
find no basis in the existing record to conclude that such requirements 
are needed for complaints filed under section 255, 716 or 718. We seek 
comment on this proposal and ask parties to describe whether there are 
any circumstances that warrant such requirements.

VII. Section 718 Internet Browsers Built Into Telephones Used With 
Public Mobile Services

    143. We seek further comment on the upcoming obligations imposed by 
section 718 which generally provides that ``[i]f a manufacturer of a 
telephone used with public mobile services * * * includes an Internet 
browser in such telephone, or if a provider of mobile service arranges 
for the inclusion of a browser in telephones to sell to customers, the 
manufacturer or provider shall ensure that the functions of the 
included browser (including the ability to launch the browser) are 
accessible to and usable by individuals who are blind or have a visual 
impairment, unless doing so is not achievable.''
    144. While section 718's requirements will not take effect for 
three years, we agree with ACB that the accessibility of mobile Web 
access technologies is critical and seek comment on the best way(s) to 
implement section 718, so as to afford affected manufacturers and 
service providers an opportunity to provide input at the outset, as 
well as to make the necessary arrangements to achieve compliance by the 
time the provisions go into effect. We would particularly welcome input 
on how the Commission can best inform and assist covered entities on 
the means by which they can meet their obligation to provide access to 
Internet browsers in mobile phones. Specifically, we seek comment on 
Verizon's proposal that we ``encourage industry forums and working 
groups to develop accessibility standards for mobile browsers'' because 
a ``cooperative effort'' will be needed to ensure compliance. To what 
extent should the Commission help to facilitate this discussion, for 
example through an advisory committee or a working group that is part 
of the Commission's Consumer Advisory Committee? We also seek comment 
on Code Factory's recommendation that manufacturers and operating 
system developers develop an accessibility API to foster the 
incorporation of screen readers into mobile platforms across different 
phones which would render the Web browser and other mobile phone 
functions accessible to individuals who are blind or visually impaired.

[[Page 13821]]

VIII. Procedural Matters

Comment Period and Procedures

    145. Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's 
rules, 47 CFR 1.415, 1.419, interested parties may file comments and 
reply comments on or before the dates indicated on the first page of 
this document. Comments may be filed using: (1) The Commission's 
Electronic Comment Filing system (ECFS), (2) the Federal Government's 
eRulemaking Portal, or (3) by filing paper copies. See Electronic 
Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ 
or the Federal eRulemaking Portal: http://www.regulations.gov. Filers 
should follow the instructions provided on the Web site for submitting 
comments.
     For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Comments shall be sent 
as an electronic file via the Internet to http://www.fcc.gov/e-file/ecfs.html. In completing the transmittal screen, commenters should 
include their full name, Postal Service mailing address, and the 
applicable docket number. Parties may also submit an electronic comment 
by Internet e-mail. To get filing instructions for e-mail comments, 
commenters should send an e-mail to [email protected], and include the 
following words in the body of the message, ``get form.'' A sample form 
and directions will be sent in response.
     Paper filers: Parties who choose to file by paper must 
file an original and four copies of each filing. If more than one 
docket or rulemaking number appears in the caption of this proceeding, 
filers must submit two additional copies for each additional docket or 
rulemaking number. Filings can be sent by hand or messenger delivery, 
by commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail (although we continue to experience delays in 
receiving U.S. Postal Service mail). All filings must be addressed to 
the Commission's Secretary, Office of the Secretary, Federal 
Communications Commission. The Commission's contractor will receive 
hand-delivered or messenger-delivered paper filings for the 
Commission's Secretary at 236 Massachusetts Avenue, NE., Suite 110, 
Washington, DC 20002. The filing hours at this location are 8 a.m. to 7 
pm All hand deliveries must be held together with rubber bands or 
fasteners. Any envelopes must be disposed of before entering the 
building. Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743. U.S. Postal Service first-class, 
Express, and Priority mail must be addressed to 445 12th Street, SW., 
Washington, DC 20554.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an e-mail to [email protected] or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).
     Availability of Documents: The public may view the 
documents filed in this proceeding during regular business hours in the 
FCC Reference Information Center, Federal Communications Commission, 
445 12th Street, SW., Room CY-A257, Washington, DC 20554, and on the 
Commission's Internet Home Page: http://www.fcc.gov. Copies of comments 
and reply comments are also available through the Commission's 
duplicating contractor: Best Copy and Printing, Inc., 445 12th Street, 
SW., Room CY-B402, Washington, DC 20554, 1-800-378-3160.

Initial Regulatory Flexibility Analysis

    146. As required by the Regulatory Flexibility Act of 1980, as 
amended (``RFA''), the Commission has prepared this present Initial 
Regulatory Flexibility Analysis (``IRFA'') of the possible significant 
economic impact on a substantial number of small entities that might 
result from adoption of the rules proposed in the Notice of Proposed 
Rulemaking (``NPRM''). Written public comments are requested on this 
IRFA. Comments must be identified as responses to the IRFA and must be 
filed by the applicable deadlines for initial comments, or reply 
comments, as specified in the NPRM. The Commission will send a copy of 
the NPRM, including this IRFA, to the Chief Counsel for Advocacy of the 
Small Business Administration (``SBA''). In addition, the NPRM and this 
IRFA (or summaries thereof) will be published in the Federal Register.

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

    147. The purpose of these proposed rules is to implement Congress' 
mandate that people with disabilities have access to advanced 
communications services and equipment. Specifically, these rules are 
proposed to implement sections 716 and 717 of the Communications Act of 
1934, as amended, which were added by the ``Twenty-First Century 
Communications and Video Accessibility Act of 2010'' (``CVAA''). Given 
the fundamental role that advanced communications services have come to 
play in today's world, the Commission believes that the CVAA represents 
the most significant governmental action for people with disabilities 
since the passage of the Americans with Disabilities Act of 1990 
(``ADA''). The inability to access communications equipment and 
services can be life-threatening in emergency situations, can severely 
limit educational and employment opportunities, and can otherwise 
interfere with full participation in business, family, social, and 
other activities. Many of these proposals build on our rules 
implementing section 255 of the Communications Act, which was added by 
the Telecommunications Act of 1996 and provides for the accessibility 
of telecommunications services and equipment.
    148. The NPRM makes proposals to implement the requirements of 
section 716, which requires that providers of advanced communications 
services and manufacturers of equipment used for such services make 
their products accessible to people with disabilities, unless it is not 
achievable to do so. It also proposes rules relating to section 717, 
which requires the Commission to establish new recordkeeping and 
enforcement procedures for manufacturers and providers subject to 
section 716 and section 255.
    149. The Commission proposes that manufacturers and service 
providers comply with the requirements of section 716 either by 
building accessibility features into their equipment or service or by 
relying on third party applications or other accessibility solutions. 
The Commission also proposes that if it is not achievable for 
manufacturers and service providers to make their products accessible 
to people with disabilities, then they must make their products 
compatible with specialized devices commonly used by people with 
disabilities.
    150. Furthermore, the Commission proposes that manufacturers and 
service providers consider performance objectives at the design stage 
as early and consistently as possible and implement such evaluation to 
the extent that it is achievable. The Commission proposes to 
incorporate into its

[[Page 13822]]

performance objectives the outcome-oriented definitions of 
``accessible,'' ``compatibility,'' and ``usable'' contained in its 
rules regarding the accessibility of telecommunications services and 
equipment. It seeks comment on whether it should adopt more specific 
performance objectives and the procedures and timelines that it should 
use to develop these objectives.
    151. The Commission also proposes to issue prospective guidelines 
concerning the new accessibility requirements. In addition, the 
Commission seeks comment on its proposal not to adopt any technical 
standards as safe harbors at this time.
    152. The Commission proposes that the accessibility requirements 
generally should apply to a wide range of manufacturers and service 
providers, including applications developers and providers of 
applications or services downloaded and run by users over service 
providers' networks. It proposes, however, to consider exemptions for 
small entities and, if one or more such exemptions is adopted, further 
proposes to consider various criteria in setting standards for such 
exemptions. The Commission also proposes to consider waivers, both 
individual and blanket, for offerings which are designed for multiple 
purposes but are designed primarily for purposes other than using 
advanced communications services.
    153. The Commission proposes to define ``achievable'' to mean 
``with reasonable effort and expense.'' In making determination about 
what is achievable under section 716, the Commission proposes to 
consider the following four factors and give them equal weight:
     ``The nature and cost of the steps needed to meet the 
requirements of this section with respect to the specific equipment or 
service in question;''
     ``The technical and economic impact on the operation of 
the manufacturer or provider and on the operation of the specific 
equipment or service in question * * *; ''
     ``The type of operations of the manufacturer or 
provider;'' and
     ``The extent to which the service provider or manufacturer 
in question offers accessible services or equipment containing varying 
degrees of functionality and features, and offered at differing price 
points.''
    154. The Commission proposes procedures to facilitate the filing of 
complaints and proposes a 180-day deadline to issue an order resolving 
informal complaints concerning the accessibility of products. In 
addition, the Commission proposes that manufacturers and providers 
subject to section 716 and section 255 maintain records of the (1) 
efforts to consult with people with disabilities; (2) accessibility 
features of their products; and (3) compatibility of their products 
with specialized devices.
    155. Moreover, in light of the range of potential complaints that 
may be filed against covered entities (including small entities) under 
the CVAA and section 255, the NPRM seeks comment on how we should 
effectively implement section 717's recordkeeping requirements without 
imposing excessive burden or expense on covered entities or requiring 
multiple submissions of the same records to the Commission. The NPRM 
seeks input on what constitutes a ``reasonable time period'' during 
which covered entities will be required to maintain these records.
    156. The NPRM also recognizes the variety of business models and 
operations of entities covered under its proposed rules and, therefore, 
proposes that the Commission not mandate any one form in which records 
must be kept in order to comply with section 717. The NPRM, however, 
seeks comment on whether there is any reason for the Commission to 
mandate a standard form of recordkeeping to comply with section 
717(a)(5) or to require covered entities to submit publicly available 
records or to re-submit records that the Commission already has 
received through a separate submission. Finally, given that the statute 
provides that these mandatory recordkeeping requirements do not take 
effect until one year after the effective date of regulations 
promulgated by the Commission pursuant to section 716(e), the NPRM 
seeks input regarding whether, and if so, in what fashion, the 
Commission should address this transition period, particularly for the 
purposes of enforcement.

B. Legal Basis

    157. The legal basis for any action that may be taken pursuant to 
the NPRM is contained in sections 1-4, 255, 303(r), 403, 503, 716, 717, 
718 of the Communications Act of 1934, as Amended, 47 U.S.C. 151-154, 
255, 303(r), 403, 503, 617, 618, 619.

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

    158. The RFA directs agencies to provide a description of, and 
where feasible, an estimate of the number of small entities that face 
possible significant economic impact by the adoption of proposed 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.'' In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act. A ``small business concern'' is one that: 
(1) Is independently owned and operated; (2) is not dominant in its 
field of operation; and (3) satisfies any additional criteria 
established by the SBA.
    159. To assist the Commission in analyzing the total number of 
small entities potentially affected by the rules proposed in the NPRM, 
we ask commenters to estimate the number of small entities that may be 
affected by those rules. To assist in assessing the nature and number 
of small entities that face possible significant economic impact by 
adoption of our proposed rules, we seek comment on the industry 
categories below and our estimates of the entities in each category 
that can, under relevant SBA standards or standards previously approved 
by the SBA for small businesses, be classified as small. Where a 
commenter proposes an exemption from the requirements of section 716, 
we also seek estimates from that commenter on the number of small 
entities in each category that would be exempted from compliance with 
section 716 under the proposed exemption, the percentage of market 
share for the service or product that would be exempted, and the 
economic impact, if any, on those entities that are not covered by the 
proposed exemption. While the NPRM and this IRFA seek comment on 
whether and how the Commission should exempt small entities from the 
requirements of section 716 for the purposes of building a record on 
that issue, we will assume, for the narrow purpose of including a 
thorough regulatory impact analysis in this IRFA, that no such 
exemptions will be provided.
    160. We divide the remainder of this section into three parts. In 
the first two, we identify those equipment manufacturers and those 
service providers that will be subject to our proposed rules and the 
industry categories within which they are classified. Within each 
category where possible, we estimate the total number of establishments 
or firms and the number of small entities (or the percentage) among 
them that face possible significant economic impact under the rules 
proposed in the NPRM. Where possible, we provide Census data on the 
number of ``firms'' in a given industrial category but, where that data 
is not available, we provide data on the number of ``establishments.'' 
The number of ``establishments'' is a less

[[Page 13823]]

helpful indicator of the number of businesses in a given category than 
the number of ``firms,'' because the latter term takes into account the 
concept of common ownership or control. Each single physical location 
counts as an ``establishment,'' even though several ``establishments'' 
may be owned or controlled by one ``firm.'' Thus, the data given in a 
category for ``establishments'' may reflect an inflated number of 
businesses in that category, including an inflated number of small 
businesses. In the third part, we identify additional industry 
categories in which small entities face possible significant economic 
impact by the adoption of those proposed rules. In the third part, as 
in the first two parts, we estimate, where possible, the number of 
establishments or firms and the number of small entities (or the 
percentages) that would face such possible impact by adoption of our 
proposed rules.
    161. Small Businesses. Nationwide, there are a total of 
approximately 29.6 million small businesses, according to the SBA.
1. Equipment Manufacturers
a. Manufacturers of Equipment To Provide VoIP
    162. Entities manufacturing equipment used to provide 
interconnected Voice Over Internet Protocol (``VoIP''), non-
interconnected VoIP, or both are generally found in one of two Census 
Bureau categories, ``Electronic Computer Manufacturing'' or ``Telephone 
Apparatus Manufacturing.'' While we recognize, as noted in the NPRM, 
that the manufacturers of equipment used to provide interconnected VoIP 
will continue to be regulated under section 255 rather than under 
section 716, we include here an analysis of the possible significant 
economic impact of our proposed rules on manufacturers of equipment 
used to provide both interconnected and non-interconnected VoIP because 
it was not possible to separate available data on these two 
manufacturing categories for VoIP equipment. In light of this 
situation, our estimates below are in all likelihood overstating the 
number of small entities that manufacture equipment used to provide 
interconnected VoIP and which are subject to our proposed section 716 
rules. However, in the absence of more accurate data, we present these 
figures to provide as thorough an analysis of the impact on small 
entities as we can at this time, with the understanding that we will 
modify our analysis as more accurate data becomes available in this 
proceeding.
    163. Electronic Computer Manufacturing. The Census Bureau defines 
this category to include ``* * * establishments primarily engaged in 
manufacturing and/or assembling electronic computers, such as 
mainframes, personal computers, workstations, laptops, and computer 
servers. Computers can be analog, digital, or hybrid * * * The 
manufacture of computers includes the assembly or integration of 
processors, coprocessors, memory, storage, and input/output devices 
into a user-programmable final product.''
    164. In this category, the SBA has deemed an electronic computer 
manufacturing business to be small if it has fewer than 1,000 
employees. For this category of manufacturers, Census data for 2007, 
which supersede similar data from the 2002 Census, show that there were 
421 such establishments that operated that year. Of those 421 
establishments, 384 (approximately 91%) had fewer than 100 employees 
and only 37 had 100 employees or more, thus, while we cannot provide a 
more precise estimate, it is clear that a great majority of these 
establishments would be deemed small under the applicable SBA size 
standard. Accordingly, the majority of establishments in this category 
can be considered small under that standard. On this basis, we estimate 
that approximately 91% or more of the manufacturers of equipment used 
to provide VoIP in this category are small and, thus, face possible 
significant economic impact from adoption of the rules proposed in the 
NPRM.
    165. Telephone Apparatus Manufacturing. The Census Bureau defines 
this category to comprise ``* * * establishments primarily engaged in 
manufacturing wire telephone and data communications equipment. These 
products may be standalone or board-level components of a larger 
system. Examples of products made by these establishments are central 
office switching equipment, cordless telephones (except cellular), PBX 
equipment, telephones, telephone answering machines, LAN modems, multi-
user modems, and other data communications equipment, such as bridges, 
routers, and gateways.''
    166. In this category, the SBA has deemed a telephone apparatus 
manufacturing business to be small if it has fewer than 1,000 
employees. For this category of manufacturers, Census data for 2007, 
which supersede similar data from the 2002 Census, show that there were 
398 such establishments that operated that year. Of those 398 
establishments, 393 (approximately 99%) had fewer than 1,000 employees 
and, thus, would be deemed small under the applicable SBA size 
standard. Accordingly, the majority of establishments in this category 
can be considered small under that standard. On this basis, the 
Commission continues to estimate that approximately 99% or more of the 
manufacturers of equipment used to provide VoIP in this category are 
small and, thus, face possible significant economic impact from 
adoption of the rules proposed in the NPRM.
b. Manufacturers of Equipment To Provide Electronic Messaging
    167. Entities that manufacture equipment (other than software) used 
to provide electronic messaging services are generally found in one of 
three Census Bureau categories: ``Radio and Television Broadcasting and 
Wireless Communications Equipment Manufacturing,'' ``Electronic 
Computer Manufacturing,'' or ``Telephone Apparatus Manufacturing.''
    168. Radio and Television Broadcasting and Wireless Communications 
Equipment Manufacturing. The Census Bureau defines this category as 
follows: ``This industry comprises establishments primarily engaged in 
manufacturing radio and television broadcast and wireless 
communications equipment. Examples of products made by these 
establishments are: ``transmitting and receiving antennas, cable 
television equipment, GPS equipment, pagers, cellular phones, mobile 
communications equipment, and radio and television studio and 
broadcasting equipment.''
    169. In this category, the SBA has deemed a business manufacturing 
radio and television broadcasting equipment, wireless communications 
equipment, or both, to be small if it has fewer than 750 employees. For 
this category of manufacturers, Census data for 2007, which supersede 
similar data from the 2002 Census, show that there were 398 such 
establishments that operated that year. Of those 398 establishments, 
393 (approximately 99%) had fewer than 1,000 employees and 912 
(approximately 97%) had fewer than 500 employees. Between these two 
figures, the Commission estimates that about 915 establishments 
(approximately 97%) had fewer than 750 employees and, thus, would be 
considered small under the applicable SBA size standard. Accordingly, 
the majority of establishments in this category can be considered small 
under that standard. On this basis, Commission estimates that 
approximately 97% or more of the

[[Page 13824]]

manufacturers of equipment used to provide electronic messaging 
services in this category are small and, thus, face possible 
significant economic impact from adoption of the rules proposed in the 
NPRM.
    170. Electronic Computer Manufacturing. The Census Bureau defines 
this category, as noted above, to include ``* * * establishments 
primarily engaged in manufacturing and/or assembling electronic 
computers, such as mainframes, personal computers, workstations, 
laptops, and computer servers. Computers can be analog, digital, or 
hybrid * * * The manufacture of computers includes the assembly or 
integration of processors, coprocessors, memory, storage, and input/
output devices into a user-programmable final product.''
    171. In this category, as noted above, the SBA has deemed an 
electronic computer manufacturing business to be small if it has fewer 
than 1,000 employees. For this category of manufacturers, Census data 
for 2007, which supersede similar data from the 2002 Census, show that 
there were 421 such establishments that operated that year. Of those 
421 establishments, 384 (approximately 91%) had fewer than 100 
employees and 37 had 100 employees or more, thus, while we cannot 
provide a more precise estimate, it is clear that a great majority of 
these establishments would be deemed small under the applicable SBA 
size standard. Accordingly, the majority of establishments in this 
category can be considered small under that standard. On this basis, we 
estimate that approximately 91% or more of the manufacturers of 
equipment used to provide electronic messaging services in this 
category are small and, thus, face possible significant economic impact 
from adoption of the rules proposed in the NPRM.
    172. Telephone Apparatus Manufacturing. The Census Bureau, as noted 
above, defines this category to comprise ``* * * establishments 
primarily engaged in manufacturing wire telephone and data 
communications equipment. These products may be standalone or board-
level components of a larger system. Examples of products made by these 
establishments are central office switching equipment, cordless 
telephones (except cellular), PBX equipment, telephones, telephone 
answering machines, LAN modems, multi-user modems, and other data 
communications equipment, such as bridges, routers, and gateways.''
    173. In this category, as noted above, the SBA has deemed a 
telephone apparatus manufacturing business to be small if it has fewer 
than 1,000 employees. For this category of manufacturers, Census data 
for 2007, which supersede similar data from the 2002 Census, show that 
there were 398 such establishments that operated that year. Of those 
398 establishments, 393 (approximately 99%) had fewer than 1,000 
employees and, thus, would be deemed small under the applicable SBA 
size standard. Accordingly, the majority of establishments in this 
category can be considered small under that standard. On this basis, 
the Commission estimates that approximately 99% or more of the 
manufacturers of equipment used to provide electronic messaging 
services in this category are small and, thus, face possible 
significant economic impact from adoption of the rules proposed in the 
NPRM.
c. Manufacturers of Equipment To Provide Interoperable Video 
Conferencing Services
    174. Entities that manufacture equipment used to provide 
interoperable and other video conferencing services are generally found 
in the Census Bureau category: ``Other Communications Equipment 
Manufacturing.'' The Census Bureau defines this category to include: 
``* * * establishments primarily engaged in manufacturing 
communications equipment (except telephone apparatus, and radio and 
television broadcast, and wireless communications equipment).''
    175. Other Communications Equipment Manufacturing. In this 
category, the SBA has deemed a business manufacturing other 
communications equipment to be small if it has fewer than 750 
employees. For this category of manufacturers, Census data for 2007, 
which supersede similar data from the 2002 Census, show that there were 
452 such establishments that operated that year. Of those 452 
establishments, all 452 (100%) had fewer than 1,000 employees and 448 
of those 452 (approximately 99%) had fewer than 500 employees. Between 
these two figures, the Commission estimates that about 450 
establishments (approximately 99.6%) had fewer than 750 employees and, 
thus, would be considered small under the applicable SBA size standard. 
Accordingly, the majority of establishments in this category can be 
considered small under that standard. On this basis, Commission 
estimates that approximately 99.6% or more of the manufacturers of 
equipment used to provide interoperable and other video conferencing 
services are small and, thus, face possible significant economic impact 
from adoption of the rules proposed in the NPRM.
d. Manufacturers of Software
    176. Entities that publish software used to provide interconnected 
VoIP, non-interconnected VoIP, electronic messaging services, or 
interoperable video conferencing services are found in the Census 
Bureau category ``Software Publishers.''
    177. Software Publishers. The Census Bureau defines this category 
to include ``* * * establishments primarily engaged in computer 
software publishing or publishing and reproduction. Establishments in 
this industry carry out operations necessary for producing and 
distributing computer software, such as designing, providing 
documentation, assisting in installation, and providing support 
services to software purchasers. These establishments may design, 
develop, and publish, or publish only.''
    178. In this category, the SBA has deemed a publisher of software 
(or manufacturer of software under the CVAA) to be small if it has $25 
million or less in average annual receipts. For this category of 
manufacturers, Census data for 2007, which supersede similar data from 
the 2002 Census, show that there were 5,313 such firms that operated 
that year. Of those 5,313 firms, 4,956 (approximately 93%) had $25 
million or less in average annual receipts and, thus, would be deemed 
small under the applicable SBA size standard. Accordingly, the majority 
of establishments in this category can be considered small under that 
standard. On this basis, Commission estimates that approximately 93% or 
more of the manufacturers of software used to provide interconnected 
VoIP, non-interconnected VoIP, electronic messaging services, and 
interoperable video conferencing services in this category are small 
and, thus, face possible significant economic impact from adoption of 
the rules proposed in the NPRM.
2. Service Providers
a. Providers of VoIP
    179. Entities that provide interconnected or non-interconnected 
VoIP or both are generally found in one of two Census Bureau 
categories, ``Wired Telecommunications Carriers'' or ``All Other 
Telecommunications.''
    180. Wired Telecommunications Carriers. The Census Bureau defines 
this category as follows: ``This industry comprises establishments 
primarily engaged in operating and/or providing access to transmission 
facilities and

[[Page 13825]]

infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired telecommunications 
networks. Transmission facilities may be based on a single technology 
or a combination of technologies. Establishments in this industry use 
the wired telecommunications network facilities that they operate to 
provide a variety of services, such as wired telephony services, 
including VoIP services; wired (cable) audio and video programming 
distribution; and wired broadband Internet services. By exception, 
establishments providing satellite television distribution services 
using facilities and infrastructure that they operate are included in 
this industry.''
    181. In this category, the SBA has deemed a wired 
telecommunications carrier to be small if it has fewer than 1,500 
employees. For this category of carriers, Census data for 2007, which 
supersede similar data from the 2002 Census, shows 3,188 firms in this 
category. Of these 3,188 firms, only 44 (approximately 1%) had 1,000 or 
more employees. While we could not find precise Census data on the 
number of firms in the group with fewer than 1,500 employees, it is 
clear that at least the 3,188 firms with fewer than 1,000 employees 
would be in that group. Thus, at least 3,144 of these 3,188 firms 
(approximately 99%) had fewer than 1,500 employees. Accordingly, the 
Commission estimates that at least 3,144 (approximately 99%) had fewer 
than 1,500 employees and thus, would be considered small under the 
applicable SBA size standard. On this basis, the Commission estimates 
that approximately 99% or more of the providers of interconnected VoIP, 
non-interconnected VoIP, or both in this category are small and, thus, 
face possible significant economic impact from adoption of the rules 
proposed in the NPRM. Our estimates of the number of providers on non-
interconnected VoIP (and the number of small entities within that 
group) are in all likelihood overstated because we could not draw in 
the data a distinction between such providers and those who provide 
interconnected VoIP. However, in the absence of more accurate data, we 
present these figures to provide as thorough an analysis of the impact 
on small entities as we can at this time, with the understanding that 
we will modify our analysis as more accurate data becomes available in 
this proceeding.
    182. All Other Telecommunications. Under the 2007 U.S. Census 
definition of firms included in the category ``All Other 
Telecommunications (NAICS Code 517919)'' comprises ``establishments 
primarily engaged in providing specialized telecommunications services, 
such as satellite tracking, communications telemetry, and radar station 
operation. This industry also includes establishments primarily engaged 
in providing satellite terminal stations and associated facilities 
connected with one or more terrestrial systems and capable of 
transmitting telecommunications to, and receiving telecommunications 
from, satellite systems. Establishments providing Internet services or 
voice over Internet protocol (VoIP) services via client-supplied 
telecommunications connections are also included in this industry.''
    183. In this category, the SBA has deemed a provider of ``all other 
telecommunications'' services to be small if it has $25 million or less 
in average annual receipts. For this category of service providers, 
Census data for 2007, which supersede similar data from the 2002 
Census, show that there were 2,383 such firms that operated that year. 
Of those 2,383 firms, 2,346 (approximately 98%) had $25 million or less 
in average annual receipts and, thus, would be deemed small under the 
applicable SBA size standard. Accordingly, the majority of 
establishments in this category can be considered small under that 
standard. On this basis, Commission estimates that approximately 98% or 
more of the providers of interconnected VoIP, non-interconnected VoIP, 
or both in this category are small and, thus, face possible significant 
economic impact from adoption of the rules proposed in the NPRM. As 
stated above, our estimates of the number of providers of non-
interconnected VoIP (and the number of small entities within that 
group) are in all likelihood overstated because we could not draw in 
the data a distinction between such providers and those who provide 
interconnected VoIP. However, in the absence of more accurate data, we 
present these figures to provide as thorough an analysis of the impact 
on small entities as we can at this time, with the understanding that 
we will modify our analysis as more accurate data becomes available in 
this proceeding.
b. Providers of Electronic Messaging Services
    184. Entities that provide electronic messaging services are 
generally found in one of the following Census Bureau categories, 
``Wireless Telecommunications Carriers (except Satellites),'' ``Wired 
Telecommunications,'' or ``Internet Publishing and Broadcasting and Web 
Search Portals.''
    185. Wireless Telecommunications Carriers (except Satellites). The 
Census Bureau defines this category to include ``* * * establishments 
engaged in operating and maintaining switching and transmission 
facilities to provide communications via the airwaves. Establishments 
in this industry have spectrum licenses and provide services using that 
spectrum, such as cellular phone services, paging services, wireless 
Internet access, and wireless video services.''
    186. In this category, the SBA has deemed a wireless 
telecommunications carrier to be small if it has fewer than 1,500 
employees. For this category of carriers, Census data for 2007, which 
supersede similar data from the 2002 Census, shows 1,383 firms in this 
category. Of these 1,383 firms, only 15 (approximately 1%) had 1,000 or 
more employees. While there is no precise Census data on the number of 
firms in the group with fewer than 1,500 employees, it is clear that at 
least the 1,368 firms with fewer than 1,000 employees would be found in 
that group. Thus, at least 1,368 of these 1,383 firms (approximately 
99%) had fewer than 1,500 employees. Accordingly, the Commission 
estimates that at least 1,368 (approximately 99%) had fewer than 1,500 
employees and, thus, would be considered small under the applicable SBA 
size standard. On this basis, Commission estimates that approximately 
99% or more of the providers of electronic messaging services in this 
category are small and, thus, face possible significant economic impact 
from adoption of the rules proposed in the NPRM.
    187. Wired Telecommunications Carriers. For the 2007 U.S. Census 
definition of firms included in the category, ``Wired 
Telecommunications Carriers (NAICS Code 517110),'' see paragraph 35 
above.
    188. In this category, the SBA has deemed a wired 
telecommunications carrier to be small if it has fewer than 1,500 
employees. For this category of carriers, Census data for 2007, which 
supersede similar data from the 2002 Census, shows 3,188 firms in this 
category. Of these 3,188 firms, only 44 (approximately 1%) had 1,000 or 
more employees. While we could not find precise Census data on the 
number of firms in the group with fewer than 1,500 employees, it is 
clear that at least the 3,188 firms with fewer than 1,000 employees 
would be in that group. Thus, at least 3,144 of these 3,188 firms 
(approximately 99%) had fewer than 1,500 employees. Accordingly, the

[[Page 13826]]

Commission estimates that of these 3,188 at least 3,144 (approximately 
99%) had fewer than 1,500 employees and, thus, would be considered 
small under the applicable SBA size standard. On this basis, the 
Commission estimates that approximately 99% or more of the providers of 
electronic messaging services in this category are small and, thus, 
face possible significant economic impact from adoption of the rules 
proposed in the NPRM.
    189. Internet Publishing and Broadcasting and Web Search Portals. 
The Census Bureau defines this category to include ``* * * 
establishments primarily engaged in 1) publishing and/or broadcasting 
content on the Internet exclusively or 2) operating Web sites that use 
a search engine to generate and maintain extensive databases of 
Internet addresses and content in an easily searchable format (and 
known as Web search portals). The publishing and broadcasting 
establishments in this industry do not provide traditional (non-
Internet) versions of the content that they publish or broadcast. They 
provide textual, audio, and/or video content of general or specific 
interest on the Internet exclusively. Establishments known as Web 
search portals often provide additional Internet services, such as e-
mail, connections to other Web sites, auctions, news, and other limited 
content, and serve as a home base for Internet users.''
    190. In this category, the SBA has deemed an Internet publisher or 
Internet broadcaster or the provider of a Web search portal on the 
Internet to be small if it has fewer than 500 employees. For this 
category of manufacturers, Census data for 2007, which supersede 
similar data from the 2002 Census, show that there were 2,705 such 
firms that operated that year. Of those 2,705 firms, 2,682 
(approximately 99%) had fewer than 500 employees and, thus, would be 
deemed small under the applicable SBA size standard. Accordingly, the 
majority of establishments in this category can be considered small 
under that standard. On this basis, Commission estimates that 
approximately 99% or more of the providers of electronic messaging 
services in this category are small and, thus, face possible 
significant economic impact from adoption of the rules proposed in the 
NPRM.
c. Providers of Interoperable Video Conferencing Services
    191. Entities that provide interoperable video conferencing 
services are found in the Census Bureau Category ``All Other 
Telecommunications.''
    192. All Other Telecommunications. For the 2007 U.S. Census 
definition of firms included in the category ``All Other 
Telecommunications (NAICS Code 517919),'' see paragraph 37 above.
    193. In this category, the SBA has deemed a provider of ``all other 
telecommunications'' services to be small if it has $25 million or less 
in average annual receipts. For this category of service providers, 
Census data for 2007, which supersede similar data from the 2002 
Census, show that there were 2,383 such firms that operated that year. 
Of those 2,383 firms, 2,346 (approximately 98%) had $25 million or less 
in average annual receipts and, thus, would be deemed small under the 
applicable SBA size standard. Accordingly, the majority of 
establishments in this category can be considered small under that 
standard. On this basis, Commission estimates that approximately 98% or 
more of the providers of interoperable video conferencing services are 
small and, thus, face possible significant economic impact from 
adoption of the rules proposed in the NPRM.
3. Additional Industry Categories
a. Certain Wireless Carriers and Service Providers
    194. Cellular Licensees. The SBA has developed a small business 
size standard for small businesses in the category ``Wireless 
Telecommunications Carriers (except satellite).'' Under that SBA 
category, a business is small if it has 1,500 or fewer employees. The 
census category of ``Cellular and Other Wireless Telecommunications'' 
is no longer used and has been superseded by the larger category 
``Wireless Telecommunications Carriers (except satellite).'' The Census 
Bureau defines this larger category to include ``* * * establishments 
engaged in operating and maintaining switching and transmission 
facilities to provide communications via the airwaves. Establishments 
in this industry have spectrum licenses and provide services using that 
spectrum, such as cellular phone services, paging services, wireless 
Internet access, and wireless video services.''
    195. In this category, the SBA has deemed a wireless 
telecommunications carrier to be small if it has fewer than 1,500 
employees. For this category of carriers, Census data for 2007, which 
supersede similar data from the 2002 Census, shows 1,383 firms in this 
category. Of these 1,383 firms, only 15 (approximately 1%) had 1,000 or 
more employees. While there is no precise Census data on the number of 
firms in the group with fewer than 1,500 employees, it is clear that at 
least the 1,368 firms with fewer than 1,000 employees would be found in 
that group. Thus, at least 1,368 of these 1,383 firms (approximately 
99%) had fewer than 1,500 employees. Accordingly, the Commission 
estimates that at least 1,368 (approximately 99%) had fewer than 1,500 
employees and, thus, would be considered small under the applicable SBA 
size standard. On this basis, Commission estimates that approximately 
99% or more of the providers of electronic messaging services in this 
category are small and, thus, face possible significant economic impact 
from adoption of the rules proposed in the NPRM.
    196. Specialized Mobile Radio. The Commission awards ``small 
entity'' bidding credits in auctions for Specialized Mobile Radio (SMR) 
geographic area licenses in the 800 MHz and 900 MHz bands to firms that 
had revenues of no more than $15 million in each of the three previous 
calendar years. The Commission awards ``very small entity'' bidding 
credits to firms that had revenues of no more than $3 million in each 
of the three previous calendar years. The SBA has approved these small 
business size standards for the 900 MHz Service. The Commission has 
held auctions for geographic area licenses in the 800 MHz and 900 MHz 
bands. The 900 MHz SMR auction began on December 5, 1995, and closed on 
April 15, 1996. Sixty bidders claiming that they qualified as small 
businesses under the $15 million size standard won 263 geographic area 
licenses in the 900 MHz SMR band. The 800 MHz SMR auction for the upper 
200 channels began on October 28, 1997, and was completed on December 
8, 1997. Ten bidders claiming that they qualified as small businesses 
under the $15 million size standard won 38 geographic area licenses for 
the upper 200 channels in the 800 MHz SMR band. A second auction for 
the 800 MHz band was held on January 10, 2002 and closed on January 17, 
2002 and included 23 licenses. One bidder claiming small business 
status won five licenses.
    197. The auction of the 1,053 800 MHz SMR geographic area licenses 
for the General Category channels began on August 16, 2000, and was 
completed on September 1, 2000. Eleven bidders that won 108 geographic 
area licenses for the General Category channels in the 800 MHz SMR band 
qualified as small businesses under the $15 million size standard. In 
an auction completed on December 5, 2000, a total of 2,800 Economic 
Area licenses in the lower 80 channels of the 800 MHz SMR service were 
sold. Of the 22 winning bidders,

[[Page 13827]]

19 claimed ``small business'' status and won 129 licenses. Thus, 
combining all three auctions, 40 winning bidders for geographic 
licenses in the 800 MHz SMR band claimed status as small business.
    198. In addition, there are numerous incumbent site-by-site SMR 
licensees and licensees with extended implementation authorizations in 
the 800 and 900 MHz bands. The Commission does not know how many firms 
provide 800 MHz or 900 MHz geographic area SMR services 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. In addition, we do not know how many of these 
firms have 1,500 or fewer employees. The Commission assumes, for 
purposes of this analysis, that all of the remaining existing extended 
implementation authorizations are held by small entities.
    199. Advanced Wireless Services. In 2008, the Commission conducted 
the auction of Advanced Wireless Services (``AWS'') licenses. This 
auction, which was designated as Auction 78, offered 35 licenses in the 
AWS 1710-1755 MHz and 2110-2155 MHz bands (``AWS-1''). The AWS-1 
licenses were licenses for which there were no winning bids in Auction 
66. That same year, the Commission completed Auction 78. A bidder with 
attributed average annual gross revenues that exceeded $15 million and 
did not exceed $40 million for the preceding three years (``small 
business'') received a 15 percent discount on its winning bid. A bidder 
with attributed average annual gross revenues that did not exceed $15 
million for the preceding three years (``very small business'') 
received a 25 percent discount on its winning bid. A bidder that had a 
combined total assets of less than $500 million and combined gross 
revenues of less than $125 million in each of the last two years 
qualified for entrepreneur status. Four winning bidders that identified 
themselves as very small businesses won 17 licenses. Three of the 
winning bidders that identified themselves as small business won five 
licenses. Additionally, one other winning bidder that qualified for 
entrepreneur status won 2 licenses.
    200. 700 MHz Band Commercial Licensees. There is 80 megahertz of 
non-Guard Band spectrum in the 700 MHz Band that is designated for 
commercial use: 698-757, 758-763, 776-787, and 788-793 MHz Bands. With 
one exception, the Commission adopted criteria for defining two groups 
of small businesses for purposes of determining their eligibility for 
bidding credits at auction. These two categories are: (1) ``Small 
business,'' which is defined as an entity with attributed average 
annual gross revenues that exceed $15 million and do not exceed $40 
million for the preceding three years; and (2) ``very small business,'' 
which is defined as an entity with attributed average annual gross 
revenues that do not exceed $15 million for the preceding three years. 
In Block C of the Lower 700 MHz Band (710-716 MHz and 740-746 MHz), 
which was licensed on the basis of 734 Cellular Market Areas, the 
Commission adopted a third criterion for determining eligibility for 
bidding credits: An ``entrepreneur,'' which is defined as an entity 
that, together with its affiliates and controlling principals, has 
average gross revenues that are not more than $3 million for the 
preceding three years. The SBA has approved these small size standards.
    201. An auction of 740 licenses for Blocks C (710-716 MHz and 740-
746 MHz) and D (716-722 MHz) of the Lower 700 MHz Band commenced on 
August 27, 2002, and closed on September 18, 2002. Of the 740 licenses 
available for auction, 484 licenses were sold to 102 winning bidders. 
Seventy-two of the winning bidders claimed small business, very small 
business, or entrepreneur status and won a total of 329 licenses. A 
second auction commenced on May 28, 2003, and closed on June 13, 2003, 
and included 256 licenses: Five EAG licenses and 251 CMA licenses. 
Seventeen winning bidders claimed small or very small business status 
and won 60 licenses, and nine winning bidders claimed entrepreneur 
status and won 154 licenses.
    202. The remaining 62 megahertz of commercial spectrum was 
auctioned on January 24 through March 18, 2008. As explained above, 
bidding credits for all of these licenses were available to ``small 
businesses'' and ``very small businesses.'' Auction 73 concluded with 
1,090 provisionally winning bids covering 1,091 licenses and totaling 
$19,592,420,000. The provisionally winning bids for the A, B, C, and E 
Block licenses exceeded the aggregate reserve prices for those blocks. 
The provisionally winning bid for the D Block license, however, did not 
meet the applicable reserve price and thus did not become a winning 
bid. Approximately 55 small businesses had winning bids. Currently, the 
10 remaining megahertz associated with the D block have not yet been 
assigned.
    203. Offshore Radiotelephone Service. This service operates on 
several UHF television broadcast channels that are not used for 
television broadcasting in the coastal areas of states bordering the 
Gulf of Mexico. There are presently approximately 55 licensees in this 
service. The Commission is unable to estimate at this time the number 
of licensees that would qualify as small under the SBA's small business 
size standard for the category of Wireless Telecommunications Carriers 
(except Satellite). Under that SBA small business size standard, a 
business is small if it has 1,500 or fewer employees. Census data for 
2007, which supersede data from the 2002 Census, show that there were 
1,383 firms that operated that year. Of those 1,383, 1,368 had fewer 
than 100 employees, and 15 firms had more than 100 employees. Thus 
under this category and the associated small business size standard, 
the majority of firms can be considered small.
    204. Government Transfer Bands. The Commission adopted small 
business size standards for the unpaired 1390-1392 MHz, 1670-1675 MHz, 
and the paired 1392-1395 MHz and 1432-1435 MHz bands. Specifically, 
with respect to these bands, the Commission defined an entity with 
average annual gross revenues for the three preceding years not 
exceeding $40 million as a ``small business,'' and an entity with 
average annual gross revenues for the three preceding years not 
exceeding $15 million as a ``very small business.'' SBA has approved 
these small business size standards for the aforementioned bands. 
Correspondingly, the Commission adopted a bidding credit of 15 percent 
for ``small businesses'' and a bidding credit of 25 percent for ``very 
small businesses.'' This bidding credit structure was found to have 
been consistent with the Commission's schedule of bidding credits, 
which may be found at Sec.  1.2110(f)(2) of the Commission's rules. The 
Commission found that these two definitions will provide a variety of 
businesses seeking to provide a variety of services with opportunities 
to participate in the auction of licenses for this spectrum and will 
afford such licensees, who may have varying capital costs, substantial 
flexibility for the provision of services. The Commission noted that it 
had long recognized that bidding preferences for qualifying bidders 
provide such bidders with an opportunity to compete successfully 
against large, well-financed entities. The Commission also noted that 
it had found that the use of tiered or graduated small business 
definitions is useful in furthering its mandate under section 309(j) of 
the Act to promote opportunities for and disseminate licenses to a wide 
variety of applicants.

[[Page 13828]]

An auction for one license in the 1670-1674 MHz band commenced on April 
30, 2003 and closed the same day. One license was awarded. The winning 
bidder was not a small entity.
b. Certain Equipment Manufacturers and Stores
    205. Part 15 Handset Manufacturers. Manufacturers of unlicensed 
wireless handsets may also become subject to requirements in this 
proceeding for their handsets used to provide VoIP applications. The 
Commission has not developed a definition of small entities applicable 
to unlicensed communications handset manufacturers. Therefore, we will 
utilize the SBA definition applicable to Radio and Television 
Broadcasting and Wireless Communications Equipment Manufacturing. The 
Census Bureau defines this category as follows: ``This industry 
comprises establishments primarily engaged in manufacturing radio and 
television broadcast and wireless communications equipment. Examples of 
products made by these establishments are: Transmitting and receiving 
antennas, cable television equipment, GPS equipment, pagers, cellular 
phones, mobile communications equipment, and radio and television 
studio and broadcasting equipment.'' The SBA has developed a small 
business size standard for Radio and Television Broadcasting and 
Wireless Communications Equipment Manufacturing, which is: All such 
firms having 750 or fewer employees. According to Census Bureau data 
for 2002, there were a total of 1,041 establishments in this category 
that operated for the entire year. Of this total, 1,010 had employment 
of under 500, and an additional 13 had employment of 500 to 999. Thus, 
under this size standard, the majority of firms can be considered 
small.
    206. Radio and Television Broadcasting and Wireless Communications 
Equipment Manufacturing. The Census Bureau defines this category as 
follows: ``This industry comprises establishments primarily engaged in 
manufacturing radio and television broadcast and wireless 
communications equipment. Examples of products made by these 
establishments are: Transmitting and receiving antennas, cable 
television equipment, GPS equipment, pagers, cellular phones, mobile 
communications equipment, and radio and television studio and 
broadcasting equipment.'' The SBA has developed a small business size 
standard for firms in this category, which is: all such firms having 
750 or fewer employees. According to Census Bureau data for 2007, there 
were a total of 919 firms in this category that operated for the entire 
year. Of this total, 777 had less than 100 employees, and an additional 
148 had over 100 employees. Thus, while we can provide a more precise 
estimate, under this size standard, the large majority of these firms 
can be considered small.
    207. Radio, Television, and Other Electronics Stores. The Census 
Bureau defines this economic census category as follows: ``This U.S. 
industry comprises: (1) Establishments known as consumer electronics 
stores primarily engaged in retailing a general line of new consumer-
type electronic products; (2) establishments specializing in retailing 
a single line of consumer-type electronic products (except computers); 
or (3) establishments primarily engaged in retailing these new 
electronic products in combination with repair services.'' The SBA has 
developed a small business size standard for Radio, Television, and 
Other Electronics Stores, which is: All such firms having $9 million or 
less in annual receipts. According to Census Bureau data for 2007, 
there were 18,291 firms in this category that operated for the entire 
year. Of this total, 17,369 firms had annual sales of under $5 million, 
and 533 firms had sales of $5 million or more but less than $10 
million. Thus, the majority of firms in this category can be considered 
small.
c. Wireline Carriers and Service Providers
    208. Incumbent Local Exchange Carriers (Incumbent LECs). Neither 
the Commission nor the SBA has developed a small business size standard 
specifically for incumbent local exchange services. The appropriate 
size standard under SBA rules is for the category Wired 
Telecommunications Carriers. Under that size standard, such a business 
is small if it has 1,500 or fewer employees. Census Bureau data for 
2007, which now supersede data from the 2002 Census, show that there 
were 3,188 firms in this category that operated for the entire year. Of 
this total, 3,144 had employment of 999 or fewer, and 44 firms had 
employment of 1000 or more. According to Commission data, 1,307 
carriers reported that they were incumbent local exchange service 
providers. Of these 1,307 carriers, an estimated 1,006 have 1,500 or 
fewer employees and 301 have more than 1,500 employees. Consequently, 
the Commission estimates that most providers of local exchange service 
are small entities that may be affected by the rules proposed in the 
NPRM. Thus under this category, the majority of these incumbent local 
exchange service providers can be considered small.
    209. Competitive Local Exchange Carriers (Competitive LECs), 
Competitive Access Providers (CAPs), Shared-Tenant Service Providers, 
and Other Local Service Providers. Neither the Commission nor the SBA 
has developed a small business size standard specifically for these 
service providers. The appropriate size standard under SBA rules is for 
the category Wired Telecommunications Carriers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
Census Bureau data for 2007, which now supersede data from the 2002 
Census, show that there were 3,188 firms in this category that operated 
for the entire year. Of this total, 3,144 had employment of 999 or 
fewer, and 44 firms had had employment of 1,000 employees or more. Thus 
under this category and the associated small business size standard, 
the majority of these Competitive LECs, CAPs, Shared-Tenant Service 
Providers, and Other Local Service Providers can be considered small 
entities. According to Commission data, 1,442 carriers reported that 
they were engaged in the provision of either competitive local exchange 
services or competitive access provider services. Of these 1,442 
carriers, an estimated 1,256 have 1,500 or fewer employees and 186 have 
more than 1,500 employees. In addition, 17 carriers have reported that 
they are Shared-Tenant Service Providers, and all 17 are estimated to 
have 1,500 or fewer employees. In addition, 72 carriers have reported 
that they are Other Local Service Providers. Of the 72, seventy have 
1,500 or fewer employees and two have more than 1,500 employees. 
Consequently, the Commission estimates that most providers of 
competitive local exchange service, competitive access providers, 
Shared-Tenant Service Providers, and Other Local Service Providers are 
small entities that may be affected by rules adopted pursuant to the 
NPRM.
    210. Interexchange Carriers. Neither the Commission nor the SBA has 
developed a small business size standard specifically for providers of 
interexchange services. The appropriate size standard under SBA rules 
is for the category Wired Telecommunications Carriers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
Census Bureau data for 2007, which now supersede data from the 2002 
Census, show that there were 3,188 firms in this category that operated 
for the entire year. Of this total, 3,144 had employment of 999 or 
fewer, and 44 firms had had

[[Page 13829]]

employment of 1,000 employees or more. Thus under this category and the 
associated small business size standard, the majority of these 
Interexchange carriers can be considered small entities. According to 
Commission data, 359 companies reported that their primary 
telecommunications service activity was the provision of interexchange 
services. Of these 359 companies, an estimated 317 have 1,500 or fewer 
employees and 42 have more than 1,500 employees. Consequently, the 
Commission estimates that the majority of interexchange service 
providers are small entities that may be affected by rules adopted 
pursuant to the NPRM.
    211. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. Census Bureau data for 2007, which now supersede data from 
the 2002 Census, show that there were 3,188 firms in this category that 
operated for the entire year. Of this total, 3,144 had employment of 
999 or fewer, and 44 firms had had employment of 1,000 employees or 
more. Thus under this category and the associated small business size 
standard, the majority of these Interexchange carriers can be 
considered small entities. According to Commission data, 33 carriers 
have reported that they are engaged in the provision of operator 
services. Of these, an estimated 31 have 1,500 or fewer employees and 2 
have more than 1,500 employees. Consequently, the Commission estimates 
that the majority of OSPs are small entities that may be affected by 
our proposed rules.
    212. Local Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. Census data for 2007 show that 1,523 firms provided resale 
services during that year. Of that number, 1,522 operated with fewer 
than 1000 employees and one operated with more than 1,000. Thus under 
this category and the associated small business size standard, the 
majority of these local resellers can be considered small entities. 
According to Commission data, 213 carriers have reported that they are 
engaged in the provision of local resale services. Of these, an 
estimated 211 have 1,500 or fewer employees and two have more than 
1,500 employees. Consequently, the Commission estimates that the 
majority of local resellers are small entities that may be affected by 
rules adopted pursuant to the Notice.
    213. Toll Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. Census data for 2007 show that 1,523 firms provided resale 
services during that year. Of that number, 1,522 operated with fewer 
than 1000 employees and one operated with more than 1,000. Thus under 
this category and the associated small business size standard, the 
majority of these resellers can be considered small entities. According 
to Commission data, 881 carriers have reported that they are engaged in 
the provision of toll resale services. Of these, an estimated 857 have 
1,500 or fewer employees and 24 have more than 1,500 employees. 
Consequently, the Commission estimates that the majority of toll 
resellers are small entities that may be affected by our proposed 
rules.
    214. Payphone Service Providers (PSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
payphone services providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. Census Bureau data for 2007, which now supersede data from 
the 2002 Census, show that there were 3,188 firms in this category that 
operated for the entire year. Of this total, 3,144 had employment of 
999 or fewer, and 44 firms had had employment of 1,000 employees or 
more. Thus under this category and the associated small business size 
standard, the majority of these PSPs can be considered small entities. 
According to Commission data, 657 carriers have reported that they are 
engaged in the provision of payphone services. Of these, an estimated 
653 have 1,500 or fewer employees and four have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
payphone service providers are small entities that may be affected by 
our action.
    215. Prepaid Calling Card Providers. Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
prepaid calling card providers. The appropriate size standard under SBA 
rules is for the category Telecommunications Resellers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
Census data for 2007 show that 1,523 firms provided resale services 
during that year. Of that number, 1,522 operated with fewer than 1000 
employees and one operated with more than 1,000. Thus under this 
category and the associated small business size standard, the majority 
of these prepaid calling card providers can be considered small 
entities. According to Commission data, 193 carriers have reported that 
they are engaged in the provision of prepaid calling cards. Of these, 
all 193 have 1,500 or fewer employees and none have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
prepaid calling card providers are small entities that may be affected 
by rules adopted pursuant to the NPRM.
    216. 800 and 800-Like Service Subscribers. Neither the Commission 
nor the SBA has developed a small business size standard specifically 
for 800 and 800-like service (``toll free'') subscribers. The 
appropriate size standard under SBA rules is for the category 
Telecommunications Resellers. Under that size standard, such a business 
is small if it has 1,500 or fewer employees. Census data for 2007 show 
that 1,523 firms provided resale services during that year. Of that 
number, 1,522 operated with fewer than 1000 employees and one operated 
with more than 1,000. Thus under this category and the associated small 
business size standard, the majority of resellers in this 
classification can be considered small entities. To focus specifically 
on the number of subscribers than on those firms which make 
subscription service available, the most reliable source of information 
regarding the number of these service subscribers appears to be data 
the Commission collects on the 800, 888, 877, and 866 numbers in use. 
According to our data for September 2009, the number of 800 numbers 
assigned was 7,860,000; the number of 888 numbers assigned was 
5,888,687; the number of 877 numbers assigned was 4,721,866; and the 
number of 866 numbers assigned was 7,867,736. The Commission does not 
have data specifying the number of these subscribers that are not 
independently owned and operated or have more than 1,500 employees, and 
thus are unable at this time to estimate with greater precision the 
number of toll free subscribers that would qualify as small businesses 
under the SBA size standard. Consequently, the Commission estimates 
that there are 7,860,000 or fewer small entity 800 subscribers;

[[Page 13830]]

5,888,687 or fewer small entity 888 subscribers; 4,721,866 or fewer 
small entity 877 subscribers; and 7,867,736 or fewer small entity 866 
subscribers.
d. Wireless Carriers and Service Providers
    217. Below, for those services where licenses are subject to 
auctions, the Commission notes that, as a general matter, the number of 
winning bidders that qualify as small businesses at the close of a 
given auction does not necessarily represent the number of small 
businesses currently in service. Also, the Commission does not 
generally track subsequent business size unless, in the context of 
assignments or transfers, unjust enrichment issues are implicated.
    218. Wireless Telecommunications Carriers (except Satellite). Since 
2007, the Census Bureau has placed wireless firms within this new, 
broad, economic census category. Prior to that time, such firms were 
within the now-superseded categories of ``Paging'' and ``Cellular and 
Other Wireless Telecommunications.'' Under the present and prior 
categories, the SBA has deemed a wireless business to be small if it 
has 1,500 or fewer employees. For the category of Wireless 
Telecommunications Carriers (except Satellite), Census data for 2007, 
which supersede data from the 2002 Census, show that there were 1,383 
firms that operated that year. Of those 1,383, 1,368 had fewer than 100 
employees, and 15 firms had more than 100 employees. Thus under this 
category and the associated small business size standard, the majority 
of firms can be considered small. Similarly, according to Commission 
data, 413 carriers reported that they were engaged in the provision of 
wireless telephony, including cellular service, Personal Communications 
Service (PCS), and Specialized Mobile Radio (SMR) Telephony services. 
Of these, an estimated 261 have 1,500 or fewer employees and 152 have 
more than 1,500 employees. Consequently, the Commission estimates that 
approximately half or more of these firms can be considered small. 
Thus, using available data, we estimate that the majority of wireless 
firms can be considered small.
    219. Wireless Communications Services. This service can be used for 
fixed, mobile, radiolocation, and digital audio broadcasting satellite 
uses. The Commission defined ``small business'' for the wireless 
communications services (WCS) auction as an entity with average gross 
revenues of $40 million for each of the three preceding years, and a 
``very small business'' as an entity with average gross revenues of $15 
million for each of the three preceding years. The SBA has approved 
these definitions. The Commission auctioned geographic area licenses in 
the WCS service. In the auction, which commenced on April 15, 1997 and 
closed on April 25, 1997, seven bidders won 31 licenses that qualified 
as very small business entities, and one bidder won one license that 
qualified as a small business entity.
    220. Common Carrier Paging. The SBA considers paging to be a 
wireless telecommunications service and classifies it under the 
industry classification Wireless Telecommunications Carriers (except 
satellite). Under that classification, the applicable size standard is 
that a business is small if it has 1,500 or fewer employees. For the 
general category of Wireless Telecommunications Carriers (except 
Satellite), Census data for 2007, which supersede data from the 2002 
Census, show that there were 1,383 firms that operated that year. Of 
those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more 
than 100 employees. Thus under this category and the associated small 
business size standard, the majority of firms can be considered small. 
The 2007 census also contains data for the specific category of 
``Paging'' ``that is classified under the seven-number NAICS code 
5172101. According to Commission data, 291 carriers have reported that 
they are engaged in Paging or Messaging Service. Of these, an estimated 
289 have 1,500 or fewer employees, and 2 have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
paging providers are small entities that may be affected by our action. 
In addition, in the 220 MHz Third Report and Order, the Commission 
developed a small business size standard for ``small businesses'' and 
``very small businesses'' for purposes of determining their eligibility 
for special provisions such as bidding credits and installment 
payments. A ``small business'' is an entity that, together with its 
affiliates and controlling principals, has average gross revenues not 
exceeding $15 million for the preceding three years. Additionally, a 
``very small business'' is an entity that, together with its affiliates 
and controlling principals, has average gross revenues that are not 
more than $3 million for the preceding three years. The SBA has 
approved these small business size standards. An auction of 
Metropolitan Economic Area licenses commenced on February 24, 2000, and 
closed on March 2, 2000. Of the 985 licenses auctioned, 440 were sold. 
Fifty-seven companies claiming small business status won.
    221. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. As noted, the SBA has developed a small business 
size standard for Wireless Telecommunications Carriers (except 
Satellite). Under the SBA small business size standard, a business is 
small if it has 1,500 or fewer employees. Census data for 2007, which 
supersede data from the 2002 Census, show that there were 1,383 firms 
that operated that year. Of those 1,383, 1,368 had fewer than 100 
employees, and 15 firms had more than 100 employees. Thus under this 
category and the associated small business size standard, the majority 
of firms can be considered small. According to Trends in Telephone 
Service data, 434 carriers reported that they were engaged in wireless 
telephony. Of these, an estimated 222 have 1,500 or fewer employees and 
212 have more than 1,500 employees. Therefore, approximately half of 
these entities can be considered small. Similarly, according to 
Commission data, 413 carriers reported that they were engaged in the 
provision of wireless telephony, including cellular service, Personal 
Communications Service (PCS), and Specialized Mobile Radio (SMR) 
Telephony services. Of these, an estimated 261 have 1,500 or fewer 
employees and 152 have more than 1,500 employees. Consequently, the 
Commission estimates that approximately half or more of these firms can 
be considered small. Thus, using available data, we estimate that the 
majority of wireless firms can be considered small.
    222. Broadband Personal Communications Service. The broadband 
personal communications services (PCS) spectrum is divided into six 
frequency blocks designated A through F, and the Commission has held 
auctions for each block. The Commission initially defined a ``small 
business'' for C- and F-Block licenses as an entity that has average 
gross revenues of $40 million or less in the three previous calendar 
years. For F-Block licenses, an additional small business size standard 
for ``very small business'' was added and is defined as an entity that, 
together with its affiliates, has average gross revenues of not more 
than $15 million for the preceding three calendar years. These small 
business size standards, in the context of broadband PCS auctions, have 
been approved by the SBA. No small businesses within the SBA-approved

[[Page 13831]]

small business size standards bid successfully for licenses in Blocks A 
and B. There were 90 winning bidders that claimed small business status 
in the first two C-Block auctions. A total of 93 bidders that claimed 
small business status won approximately 40 percent of the 1,479 
licenses in the first auction for the D, E, and F Blocks. On April 15, 
1999, the Commission completed the reauction of 347 C-, D-, E-, and F-
Block licenses in Auction No. 22. Of the 57 winning bidders in that 
auction, 48 claimed small business status and won 277 licenses.
    223. On January 26, 2001, the Commission completed the auction of 
422 C and F Block Broadband PCS licenses in Auction No. 35. Of the 35 
winning bidders in that auction, 29 claimed small business status. 
Subsequent events concerning Auction 35, including judicial and agency 
determinations, resulted in a total of 163 C and F Block licenses being 
available for grant. On February 15, 2005, the Commission completed an 
auction of 242 C-, D-, E-, and F-Block licenses in Auction No. 58. Of 
the 24 winning bidders in that auction, 16 claimed small business 
status and won 156 licenses. On May 21, 2007, the Commission completed 
an auction of 33 licenses in the A, C, and F Blocks in Auction No. 71. 
Of the 12 winning bidders in that auction, five claimed small business 
status and won 18 licenses. On August 20, 2008, the Commission 
completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS 
licenses in Auction No. 78. Of the eight winning bidders for Broadband 
PCS licenses in that auction, six claimed small business status and won 
14 licenses.
    224. Narrowband Personal Communications Services. To date, two 
auctions of narrowband personal communications services (PCS) licenses 
have been conducted. For purposes of the two auctions that have already 
been held, ``small businesses'' were entities with average gross 
revenues for the prior three calendar years of $40 million or less. 
Through these auctions, the Commission has awarded a total of 41 
licenses, out of which 11 were obtained by small businesses. To ensure 
meaningful participation of small business entities in future auctions, 
the Commission has adopted a two-tiered small business size standard in 
the Narrowband PCS Second Report and Order. A ``small business'' is an 
entity that, together with affiliates and controlling interests, has 
average gross revenues for the three preceding years of not more than 
$40 million. A ``very small business'' is an entity that, together with 
affiliates and controlling interests, has average gross revenues for 
the three preceding years of not more than $15 million. The SBA has 
approved these small business size standards.
    225. 220 MHz Radio Service--Phase I Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. Phase I licensing was conducted 
by lotteries in 1992 and 1993. There are approximately 1,515 such non-
nationwide licensees and four nationwide licensees currently authorized 
to operate in the 220 MHz band. The Commission has not developed a 
small business size standard for small entities specifically applicable 
to such incumbent 220 MHz Phase I licensees. To estimate the number of 
such licensees that are small businesses, the Commission applies the 
small business size standard under the SBA rules applicable. The SBA 
has deemed a wireless business to be small if it has 1,500 or fewer 
employees. For this service, the SBA uses the category of Wireless 
Telecommunications Carriers (except Satellite). Census data for 2007, 
which supersede data from the 2002 Census, show that there were 1,383 
firms that operated that year. Of those 1,383, 1,368 had fewer than 100 
employees, and 15 firms had more than 100 employees. Thus under this 
category and the associated small business size standard, the majority 
of firms can be considered small.
    226. 220 MHz Radio Service--Phase II Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. The Phase II 220 MHz service is 
a new service, and is subject to spectrum auctions. In the 220 MHz 
Third Report and Order, the Commission adopted a small business size 
standard for ``small'' and ``very small'' businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits and installment payments. This small business size standard 
indicates that a ``small business'' is an entity that, together with 
its affiliates and controlling principals, has average gross revenues 
not exceeding $15 million for the preceding three years. A ``very small 
business'' is an entity that, together with its affiliates and 
controlling principals, has average gross revenues that do not exceed 
$3 million for the preceding three years. The SBA has approved these 
small business size standards. Auctions of Phase II licenses commenced 
on September 15, 1998, and closed on October 22, 1998. In the first 
auction, 908 licenses were auctioned in three different-sized 
geographic areas: Three nationwide licenses, 30 Regional Economic Area 
Group (EAG) Licenses, and 875 Economic Area (EA) Licenses. Of the 908 
licenses auctioned, 693 were sold. Thirty-nine small businesses won 
licenses in the first 220 MHz auction. The second auction included 225 
licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies 
claiming small business status won 158 licenses.
    227. 800 MHz and 900 MHz Specialized Mobile Radio Licenses. The 
Commission awards small business bidding credits in auctions for 
Specialized Mobile Radio (``SMR'') geographic area licenses in the 800 
MHz and 900 MHz bands to entities that had revenues of no more than $15 
million in each of the three previous calendar years. The Commission 
awards very small business bidding credits to entities that had 
revenues of no more than $3 million in each of the three previous 
calendar years. The SBA has approved these small business size 
standards for the 800 MHz and 900 MHz SMR Services. The Commission has 
held auctions for geographic area licenses in the 800 MHz and 900 MHz 
bands. The 900 MHz SMR auction was completed in 1996. Sixty bidders 
claiming that they qualified as small businesses under the $15 million 
size standard won 263 geographic area licenses in the 900 MHz SMR band. 
The 800 MHz SMR auction for the upper 200 channels was conducted in 
1997. Ten bidders claiming that they qualified as small businesses 
under the $15 million size standard won 38 geographic area licenses for 
the upper 200 channels in the 800 MHz SMR band. A second auction for 
the 800 MHz band was conducted in 2002 and included 23 BEA licenses. 
One bidder claiming small business status won five licenses.
    228. The auction of the 1,053 800 MHz SMR geographic area licenses 
for the General Category channels was conducted in 2000. Eleven bidders 
won 108 geographic area licenses for the General Category channels in 
the 800 MHz SMR band qualified as small businesses under the $15 
million size standard. In an auction completed in 2000, a total of 
2,800 Economic Area licenses in the lower 80 channels of the 800 MHz 
SMR service were awarded. Of the 22 winning bidders, 19 claimed small 
business status and won 129 licenses. Thus, combining all three 
auctions, 40 winning bidders for geographic licenses in the 800 MHz SMR 
band claimed status as small business.
    229. In addition, there are numerous incumbent site-by-site SMR 
licensees and licensees with extended implementation authorizations in 
the 800 and 900 MHz bands. We do not know how many firms provide 800 
MHz or 900 MHz geographic area SMR

[[Page 13832]]

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. In addition, we do not know how 
many of these firms have 1,500 or fewer employees. We assume, for 
purposes of this analysis, that all of the remaining existing extended 
implementation authorizations are held by small entities, as that small 
business size standard is approved by the SBA.
    230. 700 MHz Guard Band Licensees. In 2000, in the 700 MHz Guard 
Band Order, the Commission adopted size standards for ``small 
businesses'' and ``very small businesses'' for purposes of determining 
their eligibility for special provisions such as bidding credits and 
installment payments. A small business in this service is an entity 
that, together with its affiliates and controlling principals, has 
average gross revenues not exceeding $40 million for the preceding 
three years. Additionally, a very small business is an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues that are not more than $15 million for the preceding 
three years. SBA approval of these definitions is not required. An 
auction of 52 Major Economic Area licenses commenced on September 6, 
2000, and closed on September 21, 2000. Of the 104 licenses auctioned, 
96 licenses were sold to nine bidders. Five of these bidders were small 
businesses that won a total of 26 licenses. A second auction of 700 MHz 
Guard Band licenses commenced on February 13, 2001, and closed on 
February 21, 2001. All eight of the licenses auctioned were sold to 
three bidders. One of these bidders was a small business that won a 
total of two licenses.
    231. Air-Ground Radiotelephone Service. The Commission has 
previously used the SBA's small business size standard applicable to 
Wireless Telecommunications Carriers (except Satellite), i.e., an 
entity employing no more than 1,500 persons. There are approximately 
100 licensees in the Air-Ground Radiotelephone Service, and under that 
definition, the Commission estimates that almost all of them qualify as 
small entities under the SBA definition. For purposes of assigning Air-
Ground Radiotelephone Service licenses through competitive bidding, the 
Commission has defined ``small business'' as an entity that, together 
with controlling interests and affiliates, has average annual gross 
revenues for the preceding three years not exceeding $40 million. A 
``very small business'' is defined as an entity that, together with 
controlling interests and affiliates, has average annual gross revenues 
for the preceding three years not exceeding $15 million. These 
definitions were approved by the SBA. In May 2006, the Commission 
completed an auction of nationwide commercial Air-Ground Radiotelephone 
Service licenses in the 800 MHz band (Auction No. 65). On June 2, 2006, 
the auction closed with two winning bidders winning two Air-Ground 
Radiotelephone Services licenses. Neither of the winning bidders 
claimed small business status.
    232. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service. A significant subset of the Rural Radiotelephone Service is 
the Basic Exchange Telephone Radio System (BETRS). For purposes of its 
analysis of the Rural Radiotelephone Service, the Commission uses the 
SBA small business size standard for the category Wireless 
Telecommunications Carriers (except satellite), which is 1,500 or fewer 
employees. Census data for 2007, which supersede data from the 2002 
Census, show that there were 1,383 firms that operated that year. Of 
those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more 
than 100 employees. Thus under this category and the associated small 
business size standard, the majority of firms in the Rural 
Radiotelephone Service can be considered small.
    233. Aviation and Marine Radio Services. Small businesses in the 
aviation and marine radio services use a very high frequency (VHF) 
marine or aircraft radio and, as appropriate, an emergency position-
indicating radio beacon (and/or radar) or an emergency locator 
transmitter. The Commission has not developed a small business size 
standard specifically applicable to these small businesses. For 
purposes of this analysis, the Commission uses the SBA small business 
size standard for the category Wireless Telecommunications Carriers 
(except satellite), which is 1,500 or fewer employees. Census data for 
2007, which supersede data from the 2002 Census, show that there were 
1,383 firms that operated that year. Of those 1,383, 1,368 had fewer 
than 100 employees, and 15 firms had more than 100 employees. Thus 
under this category and the associated small business size standard, 
the majority of firms can be considered small.
    234. Fixed Microwave Services. Microwave services include common 
carrier, private-operational fixed, and broadcast auxiliary radio 
services. They also include the Local Multipoint Distribution Service 
(LMDS), the Digital Electronic Message Service (DEMS), and the 24 GHz 
Service, where licensees can choose between common carrier and non-
common carrier status. The Commission has not yet defined a small 
business with respect to microwave services. For purposes of this IRFA, 
the Commission will use the SBA's definition applicable to Wireless 
Telecommunications Carriers (except satellite)--i.e., an entity with no 
more than 1,500 persons is considered small. For the category of 
Wireless Telecommunications Carriers (except satellite), Census data 
for 2007, which supersede data from the 2002 Census, show that there 
were 1,383 firms that operated that year. Of those 1,383, 1,368 had 
fewer than 100 employees, and 15 firms had more than 100 employees. 
Thus under this category and the associated small business size 
standard, the majority of firms can be considered small. The Commission 
notes that the number of firms does not necessarily track the number of 
licensees. The Commission estimates that virtually all of the Fixed 
Microwave licensees (excluding broadcast auxiliary licensees) would 
qualify as small entities under the SBA definition.
    235. Offshore Radiotelephone Service. This service operates on 
several UHF television broadcast channels that are not used for 
television broadcasting in the coastal areas of states bordering the 
Gulf of Mexico. There are presently approximately 55 licensees in this 
service. The Commission is unable to estimate at this time the number 
of licensees that would qualify as small under the SBA's small business 
size standard for the category of Wireless Telecommunications Carriers 
(except satellite). Under that SBA small business size standard, a 
business is small if it has 1,500 or fewer employees. Census data for 
2007, which supersede data from the 2002 Census, show that there were 
1,383 firms that operated that year. Of those 1,383, 1,368 had fewer 
than 100 employees, and 15 firms had more than 100 employees. Thus 
under this category and the associated small business size standard, 
the majority of firms can be considered small.
    236. 39 GHz Service. The Commission created a special small 
business size standard for 39 GHz licenses--an entity that has average 
gross revenues of $40 million or less in the three previous calendar 
years. An additional size standard for ``very small business'' is: An 
entity that, together with affiliates, has average gross revenues of 
not more than $15 million for the preceding three calendar years. The 
SBA has approved these small business size standards. The

[[Page 13833]]

auction of the 2,173 39 GHz licenses began on April 12, 2000 and closed 
on May 8, 2000. The 18 bidders who claimed small business status won 
849 licenses. Consequently, the Commission estimates that 18 or fewer 
39 GHz licensees are small entities that may be affected by our action.
    237. Wireless Cable Systems. Broadband Radio Service and 
Educational Broadband Service. Broadband Radio Service systems, 
previously referred to as Multipoint Distribution Service (MDS) and 
Multichannel Multipoint Distribution Service (MMDS) systems, and 
``wireless cable,'' transmit video programming to subscribers and 
provide two-way high speed data operations using the microwave 
frequencies of the Broadband Radio Service (BRS) and Educational 
Broadband Service (EBS) (previously referred to as the Instructional 
Television Fixed Service (ITFS)). In connection with the 1996 BRS 
auction, the Commission established a small business size standard as 
an entity that had annual average gross revenues of no more than $40 
million in the previous three calendar years. The BRS auctions resulted 
in 67 successful bidders obtaining licensing opportunities for 493 
Basic Trading Areas (BTAs). Of the 67 auction winners, 61 met the 
definition of a small business. BRS also includes licensees of stations 
authorized prior to the auction. At this time, we estimate that of the 
61 small business BRS auction winners, 48 remain small business 
licensees. In addition to the 48 small businesses that hold BTA 
authorizations, there are approximately 392 incumbent BRS licensees 
that are considered small entities. After adding the number of small 
business auction licensees to the number of incumbent licensees not 
already counted, we find that there are currently approximately 440 BRS 
licensees that are defined as small businesses under either the SBA or 
the Commission's rules. In 2009, the Commission conducted Auction 86, 
the sale of 78 licenses in the BRS areas. The Commission offered three 
levels of bidding credits: (i) A bidder with attributed average annual 
gross revenues that exceed $15 million and do not exceed $40 million 
for the preceding three years (small business) will receive a 15 
percent discount on its winning bid; (ii) a bidder with attributed 
average annual gross revenues that exceed $3 million and do not exceed 
$15 million for the preceding three years (very small business) will 
receive a 25 percent discount on its winning bid; and (iii) a bidder 
with attributed average annual gross revenues that do not exceed $3 
million for the preceding three years (entrepreneur) will receive a 35 
percent discount on its winning bid. Auction 86 concluded in 2009 with 
the sale of 61 licenses. Of the ten winning bidders, two bidders that 
claimed small business status won 4 licenses; one bidder that claimed 
very small business status won three licenses; and two bidders that 
claimed entrepreneur status won six licenses.
    238. In addition, the SBA's Cable Television Distribution Services 
small business size standard is applicable to EBS. There are presently 
2,032 EBS licensees. All but 100 of these licenses are held by 
educational institutions. Educational institutions are included in this 
analysis as small entities. Thus, we estimate that at least 1,932 
licensees are small businesses. Since 2007, Cable Television 
Distribution Services have been defined within the broad economic 
census category of Wired Telecommunications Carriers; that category is 
defined as follows: ``This industry comprises establishments primarily 
engaged in operating and/or providing access to transmission facilities 
and infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired telecommunications 
networks. Transmission facilities may be based on a single technology 
or a combination of technologies.'' For these services, the Commission 
uses the SBA small business size standard for the category ``Wireless 
Telecommunications Carriers (except satellite),'' which is 1,500 or 
fewer employees. To gauge small business prevalence for these cable 
services we must, however, use the most current census data. Census 
data for 2007, which supersede data from the 2002 Census, show that 
there were 1,383 firms that operated that year. Of those 1,383, 1,368 
had fewer than 100 employees, and 15 firms had more than 100 employees. 
Thus under this category and the associated small business size 
standard, the majority of firms can be considered small. The Commission 
notes that the Census' use the classifications ``firms'' does not track 
the number of ``licenses''.
    239. In the 1998 and 1999 LMDS auctions, the Commission defined a 
small business as an entity that has annual average gross revenues of 
less than $40 million in the previous three calendar years. Moreover, 
the Commission added an additional classification for a ``very small 
business,'' which was defined as an entity that had annual average 
gross revenues of less than $15 million in the previous three calendar 
years. These definitions of ``small business'' and ``very small 
business'' in the context of the LMDS auctions have been approved by 
the SBA. In the first LMDS auction, 104 bidders won 864 licenses. Of 
the 104 auction winners, 93 claimed status as small or very small 
businesses. In the LMDS re-auction, 40 bidders won 161 licenses. Based 
on this information, the Commission believes that the number of small 
LMDS licenses will include the 93 winning bidders in the first auction 
and the 40 winning bidders in the re-auction, for a total of 133 small 
entity LMDS providers as defined by the SBA and the Commission's 
auction rules.
    240. 218-219 MHz Service. The first auction of 218-219 MHz spectrum 
resulted in 170 entities winning licenses for 594 Metropolitan 
Statistical Area (MSA) licenses. Of the 594 licenses, 557 were won by 
entities qualifying as a small business. For that auction, the small 
business size standard was an entity that, together with its 
affiliates, has no more than a $6 million net worth and, after federal 
income taxes (excluding any carry over losses), has no more than $2 
million in annual profits each year for the previous two years. In the 
218-219 MHz Report and Order and Memorandum Opinion and Order, the 
Commission established a small business size standard for a ``small 
business'' as an entity that, together with its affiliates and persons 
or entities that hold interests in such an entity and their affiliates, 
has average annual gross revenues not to exceed $15 million for the 
preceding three years. A ``very small business'' is defined as an 
entity that, together with its affiliates and persons or entities that 
hold interests in such an entity and its affiliates, has average annual 
gross revenues not to exceed $3 million for the preceding three years. 
These size standards will be used in future auctions of 218-219 MHz 
spectrum.
    241. 24 GHz--Incumbent Licensees. This analysis may affect 
incumbent licensees who were relocated to the 24 GHz band from the 18 
GHz band, and applicants who wish to provide services in the 24 GHz 
band. For this service, the Commission uses the SBA small business size 
standard for the category ``Wireless Telecommunications Carriers 
(except satellite),'' which is 1,500 or fewer employees. To gauge small 
business prevalence for these cable services we must, however, use the 
most current census data. Census data for 2007, which supersede data 
from the 2002 Census, show that there were 1,383 firms that operated 
that year. Of those 1,383, 1,368 had fewer than 100 employees, and 15 
firms had more than 100 employees. Thus under this

[[Page 13834]]

category and the associated small business size standard, the majority 
of firms can be considered small. The Commission notes that the Census' 
use of the classifications ``firms'' does not track the number of 
``licenses''. The Commission believes that there are only two licensees 
in the 24 GHz band that were relocated from the 18 GHz band, Teligent 
and TRW, Inc. It is our understanding that Teligent and its related 
companies have less than 1,500 employees, though this may change in the 
future. TRW is not a small entity. Thus, only one incumbent licensee in 
the 24 GHz band is a small business entity.
    242. 24 GHz--Future Licensees. With respect to new applicants in 
the 24 GHz band, the small business size standard for ``small 
business'' is an entity that, together with controlling interests and 
affiliates, has average annual gross revenues for the three preceding 
years not in excess of $15 million. ``Very small business'' in the 24 
GHz band is an entity that, together with controlling interests and 
affiliates, has average gross revenues not exceeding $3 million for the 
preceding three years. The SBA has approved these small business size 
standards. These size standards will apply to the future auction, if 
held.
    243. Satellite Telecommunications Providers. Two economic census 
categories address the satellite industry. The first category has a 
small business size standard of $15 million or less in average annual 
receipts, under SBA rules. The second has a size standard of $25 
million or less in annual receipts.
    244. The category of Satellite Telecommunications ``comprises 
establishments primarily engaged in providing telecommunications 
services to other establishments in the telecommunications and 
broadcasting industries by forwarding and receiving communications 
signals via a system of satellites or reselling satellite 
telecommunications.'' Census Bureau data for 2007 show that 512 
Satellite Telecommunications firms that operated for that entire year. 
Of this total, 464 firms had annual receipts of under $10 million, and 
18 firms had receipts of $10 million to $24,999,999. Consequently, the 
Commission estimates that the majority of Satellite Telecommunications 
firms are small entities that might be affected by our action.
    245. The second category, i.e. ``All Other Telecommunications'' 
comprises ``establishments primarily engaged in providing specialized 
telecommunications services, such as satellite tracking, communications 
telemetry, and radar station operation. This industry also includes 
establishments primarily engaged in providing satellite terminal 
stations and associated facilities connected with one or more 
terrestrial systems and capable of transmitting telecommunications to, 
and receiving telecommunications from, satellite systems. 
Establishments providing Internet services or voice over Internet 
protocol (VoIP) services via client-supplied telecommunications 
connections are also included in this industry.'' For this category, 
Census Bureau data for 2007 show that there were a total of 2,383 firms 
that operated for the entire year. Of this total, 2,347 firms had 
annual receipts of under $25 million and 12 firms had annual receipts 
of $25 million to $49, 999,999. Consequently, the Commission estimates 
that the majority of All Other Telecommunications firms are small 
entities that might be affected by our action.
e. Cable and OVS Operators
    246. Because section 706 requires us to monitor the deployment of 
broadband regardless of technology or transmission media employed, the 
Commission anticipates that some broadband service providers may not 
provide telephone service. Accordingly, the Commission describes below 
other types of firms that may provide broadband services, including 
cable companies, MDS providers, and utilities, among others.
    247. Cable and Other Program Distributors. Since 2007, these 
services have been defined within the broad economic census category of 
Wired Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.'' The SBA has developed a small business size standard 
for this category, which is: all such firms having 1,500 or fewer 
employees. Census data for 2007, which supersede data from the 2002 
Census, show that there were 1,383 firms that operated that year. Of 
those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more 
than 100 employees. Thus under this category and the associated small 
business size standard, the majority of such firms can be considered 
small.
    248. Cable Companies and Systems. The Commission has also developed 
its own small business size standards, for the purpose of cable rate 
regulation. Under the Commission's rules, a ``small cable company'' is 
one serving 400,000 or fewer subscribers, nationwide. Industry data 
indicate that, of 1,076 cable operators nationwide, all but eleven are 
small under this size standard. In addition, under the Commission's 
rules, a ``small system'' is a cable system serving 15,000 or fewer 
subscribers. Industry data indicate that, of 7,208 systems nationwide, 
6,139 systems have under 10,000 subscribers, and an additional 379 
systems have 10,000-19,999 subscribers. Thus, under this second size 
standard, most cable systems are small.
    249. Cable System Operators. The Communications Act of 1934, as 
amended, also contains a size standard for small cable system 
operators, which is ``a cable operator that, directly or through an 
affiliate, serves in the aggregate fewer than 1 percent of all 
subscribers in the United States and is not affiliated with any entity 
or entities whose gross annual revenues in the aggregate exceed 
$250,000,000.'' The Commission has determined that an operator serving 
fewer than 677,000 subscribers shall be deemed a small operator, if its 
annual revenues, when combined with the total annual revenues of all 
its affiliates, do not exceed $250 million in the aggregate. Industry 
data indicate that, of 1,076 cable operators nationwide, all but ten 
are small under this size standard. We note that the Commission neither 
requests nor collects information on whether cable system operators are 
affiliated with entities whose gross annual revenues exceed $250 
million, and therefore we are unable to estimate more accurately the 
number of cable system operators that would qualify as small under this 
size standard.
    250. Open Video Services. Open Video Service (OVS) systems provide 
subscription services. The open video system (``OVS'') framework was 
established in 1996, and is one of four statutorily recognized options 
for the provision of video programming services by local exchange 
carriers. The OVS framework provides opportunities for the distribution 
of video programming other than through cable systems. Because OVS 
operators provide subscription services, OVS falls within the SBA small 
business size standard covering cable services, which is ``Wired 
Telecommunications Carriers.'' The SBA has developed a small business 
size standard for this category, which is: all such firms having 1,500 
or fewer employees. To gauge small business prevalence for the OVS 
service, the Commission relies on data currently available from the 
U.S. Census for the

[[Page 13835]]

year 2007. According to that source, there were 3,188 firms that in 
2007 were Wired Telecommunications Carriers. Of these, 3,144 operated 
with less than 1,000 employees, and 44 operated with more than 1,000 
employees. However, as to the latter 44 there is no data available that 
shows how many operated with more than 1,500 employees. Based on this 
data, the majority of these firms can be considered small. In addition, 
we note that the Commission has certified some OVS operators, with some 
now providing service. Broadband service providers (``BSPs'') are 
currently the only significant holders of OVS certifications or local 
OVS franchises. The Commission does not have financial or employment 
information regarding the entities authorized to provide OVS, some of 
which may not yet be operational. Thus, at least some of the OVS 
operators may qualify as small entities. The Commission further notes 
that it has certified approximately 45 OVS operators to serve 75 areas, 
and some of these are currently providing service. Affiliates of 
Residential Communications Network, Inc. (RCN) received approval to 
operate OVS systems in New York City, Boston, Washington, DC, and other 
areas. RCN has sufficient revenues to assure that they do not qualify 
as a small business entity. Little financial information is available 
for the other entities that are authorized to provide OVS and are not 
yet operational. Given that some entities authorized to provide OVS 
service have not yet begun to generate revenues, the Commission 
concludes that up to 44 OVS operators (those remaining) might qualify 
as small businesses that may be affected by the rules and policies 
adopted herein.
f. Internet Service Providers, Web Portals and Other Information 
Services
    251. Internet Service Providers, Web Portals and Other Information 
Services. In 2007, the SBA recognized two new small business, economic 
census categories. They are (1) Internet Publishing and Broadcasting 
and Web Search Portals, and (2) All Other Information Services.
    252. Internet Service Providers. The 2007 Economic Census places 
these firms, whose services might include voice over Internet protocol 
(VoIP), in either of two categories, depending on whether the service 
is provided over the provider's own telecommunications facilities 
(e.g., cable and DSL ISPs), or over client-supplied telecommunications 
connections (e.g., dial-up ISPs). The former are within the category of 
Wired Telecommunications Carriers, which has an SBA small business size 
standard of 1,500 or fewer employees. These are also labeled 
``broadband.'' The latter are within the category of All Other 
Telecommunications, which has a size standard of annual receipts of $25 
million or less. These are labeled non-broadband.
    253. The most current Economic Census data for all such firms are 
2007 data, which are detailed specifically for ISPs within the 
categories above. For the first category, the data show that 396 firms 
operated for the entire year, of which 159 had nine or fewer employees. 
For the second category, the data show that 1,682 firms operated for 
the entire year. Of those, 1,675 had annual receipts below $25 million 
per year, and an additional two had receipts of between $25 million and 
$ 49,999,999. Consequently, we estimate that the majority of ISP firms 
are small entities.
    254. Internet Publishing and Broadcasting and Web Search Portals. 
This industry comprises establishments primarily engaged in (1) 
publishing and/or broadcasting content on the Internet exclusively or 
(2) operating Web sites that use a search engine to generate and 
maintain extensive databases of Internet addresses and content in an 
easily searchable format (and known as Web search portals). The 
publishing and broadcasting establishments in this industry do not 
provide traditional (non-Internet) versions of the content that they 
publish or broadcast. They provide textual, audio, and/or video content 
of general or specific interest on the Internet exclusively. 
Establishments known as Web search portals often provide additional 
Internet services, such as e-mail, connections to other web sites, 
auctions, news, and other limited content, and serve as a home base for 
Internet users. The SBA has developed a small business size standard 
for this category; that size standard is fewer than 500 employees. 
Thus, a firm in this category with less than 500 employees is 
considered a small business. According to Census Bureau data for 2007, 
there were 2,705 firms that provided one or more of these services for 
that entire year. Of these, 2,682 operated with less than 500 employees 
and 13 operated with 500 to 999 employees. Consequently, we estimate 
the majority of these firms are small entities that may be affected by 
our proposed actions.
    255. Data Processing, Hosting, and Related Services. This industry 
comprises establishments primarily engaged in providing infrastructure 
for hosting or data processing services. These establishments may 
provide specialized hosting activities, such as web hosting, streaming 
services or application hosting; provide application service 
provisioning; or may provide general time-share mainframe facilities to 
clients. Data processing establishments provide complete processing and 
specialized reports from data supplied by clients or provide automated 
data processing and data entry services. The SBA has developed a small 
business size standard for this category; that size standard is $25 
million or less in average annual receipts. According to Census Bureau 
data for 2007, there were 8,060 firms in this category that operated 
for the entire year. Of these, 6,726 had annual receipts of under $25 
million, and 155 had receipts between $25 million and $49,999,999 
million. Consequently, we estimate that the majority of these firms are 
small entities that may be affected by our proposed actions.
    256. All Other Information Services. ``This industry comprises 
establishments primarily engaged in providing other information 
services (except new syndicates and libraries and archives).'' Our 
action pertains to interconnected VoIP services, which could be 
provided by entities that provide other services such as e-mail, online 
gaming, web browsing, video conferencing, instant messaging, and other, 
similar IP-enabled services. The SBA has developed a small business 
size standard for this category; that size standard is $7.0 million or 
less in average annual receipts. According to Census Bureau data for 
2007, there were 367 firms in this category that operated for the 
entire year. Of these, 334 had annual receipts of under $5 million, and 
an additional 11 firms had receipts of between $5 million and 
$9,999,999. Consequently, we estimate that the majority of these firms 
are small entities that may be affected by our action.

D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements

    257. We summarize below the requirements in the NPRM and proposed 
rules regarding compliance with sections 716 and 717, including 
recordkeeping and reporting obligations. Additional information on each 
of these requirements can be found in the NPRM.
    258. Recordkeeping. The NPRM proposes, beginning one year after the 
effective date of regulations promulgated by the Commission pursuant to 
section 716(e), to require that each manufacturer of equipment 
(including software) used to provide ACS and each provider of such 
services

[[Page 13836]]

subject to sections 255, 716, and 718, not exempted under rules 
proposed in that NPRM, maintain, in the ordinary course of business and 
for a reasonable period, certain records. These records are to document 
the efforts taken by such manufacturer or service provider to implement 
sections 255, 716, and 718, including: (1) Information about the 
manufacturer's or provider's efforts to consult with individuals with 
disabilities; (2) descriptions of the accessibility features of its 
products and services; and (3) information about the compatibility of 
such products and services with peripheral devices or specialized 
customer premise equipment commonly used by individuals with 
disabilities to achieve access.
    259. Reporting Obligations. The CVAA and the Commission's proposed 
rules require that an officer of each manufacturer of equipment 
(including software) used to provide ACS and an officer of each 
provider of such services submit to the Commission an annual 
certificate that records are being kept in accordance with the above 
recordkeeping requirements, unless such manufacturer or provider has 
been exempted from compliance with section 716 under applicable rules.
    260. Costs of Compliance. Because of the diverse manufacturers of 
equipment used to provide ACS and diverse providers of ACS that may be 
subject to section 716, the possible exemption of certain small 
entities from compliance with that section, the multiple general and 
entity-specific factors used in determining, whether for a given 
manufacturer (or service provider) accessibility for a particular item 
of ACS equipment (or a particular service) is achievable, and the 
various provisions of section 716 and the proposed rules on when and to 
what extent accessibility must be incorporated into a given item of ACS 
equipment or service, it is difficult to estimate the costs of 
compliance for those small entities that may not be covered by an 
exemption or waiver, should the Commission choose to adopt any such 
exemptions or waivers. Accordingly, the NPRM seeks comment on the costs 
of compliance with these proposed rules.

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

    261. The RFA requires an agency to describe any significant 
alternatives that it has considered in developing its approach, which 
may include the following four alternatives (among others): ``(1) The 
establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance and reporting requirements under the rule for such small 
entities; (3) the use of performance rather than design standards; and 
(4) an exemption from coverage of the rule, or any part thereof, for 
such small entities.''
    262. In addition to the factors in the RFA identified above, the 
achievability factors in the CVAA also serve to mitigate adverse 
impacts and reduce burdens on small entities. In the NPRM, the 
Commission proposes to make determinations about what is achievable by 
giving four factors equal weight. Two of these factors take into 
account the resources available to covered entities and may have a 
direct impact on small entities and the obligations they face under the 
CVAA: the second factor, the technical and economic impact on the 
operation of the manufacturer or provider and on the operation of the 
specific equipment or service in question, and the third factor, the 
type of operations of the manufacturer or provider. In addition, 
consideration of the first factor (the nature and cost of the steps 
needed to meet the requirements with respect to the specific equipment 
or service in question) and the fourth factor (the extent to which the 
service provider or manufacturer in question offers accessibility 
services or equipment containing varying degrees of functionality and 
features, and offered at different price points) would benefit all 
entities subject to section 716, including small entities.
    263. The Commission proposes not to consider additional factors and 
only to consider the factors enumerated in the statute, in light of 
legislative history directing the Commission to weigh the factors 
equally. While adoption of this proposal would prevent the Commission 
from considering additional factors that may benefit small entities, it 
would also require that the Commission consider only the factors listed 
above, which clearly serve to reduce the burden on small entities. The 
Commission does, however, seek comment on whether it might have the 
discretion to weigh other factors not specified in the statute. In 
addition, the Commission proposes to construe the factors broadly and 
to weigh any relevant considerations in determining their meaning.
    264. The Commission also proposes to consider exemptions from 
section 716 for small entities and, if one or more such exemptions were 
adopted, further proposes to consider various criteria in setting 
standards for such exemptions. The Commission could have proposed not 
to exercise its discretionary authority to exempt small entities or 
could have proposed one or more specific size standards for any such 
exemptions but determined that it was necessary to build a more 
complete factual record on what factors it should consider in making 
this determination. Specifically, before making a specific proposal, 
the Commission seeks to understand the impact any such proposal would 
have on small entities, the marketplace of ACS services and equipment, 
and on people with disabilities.
    265. In addition, the Commission proposes consideration of specific 
performance objectives and seeks comment on alternative ways to develop 
procedures and timelines to develop these objectives. Such alternatives 
could be structured to reduce the burdens on small entities of 
compliance with section 716.
    266. The Commission also proposes not to adopt technical standards 
as safe harbors at this time. It determined that it needed to develop a 
more complete record on this issue before taking action.
    267. Finally, the Commission does not propose separate 
recordkeeping and reporting obligations for small entities. The 
Commission, however, has proposed that it will not mandate any one form 
in which records must be kept, to take into account that covered 
entities have a variety of business models and modes of operation.

F. Federal Rules That May Duplicate, Overlap, or Conflict With Proposed 
Rules

    268. Section 255(e) of the Communications Act, as amended, 47 
U.S.C. 255(e), directs the United States Access Board (Access Board) to 
develop equipment accessibility guidelines ``in conjunction with'' the 
Commission, and periodically to review and update those guidelines. We 
view the Board's current guidelines as well as its draft guidelines as 
starting points for our interpretation and implementation of sections 
716 and 717 of the Communications Act, as amended, 47 U.S.C. 617, 618, 
as well as section 255, but because they do not currently cover ACS or 
equipment used to provide or access ACS, we must necessarily adapt 
these guidelines in our comprehensive implementation scheme. As such, 
it is our tentative view that our proposed rules do not overlap, 
duplicate, or conflict with either Access Board Final Rules, or (if 
later adopted) the Access Board Draft Guidelines.

[[Page 13837]]

Paperwork Reduction Act of 1995
    269. Initial Paperwork Reduction Analysis. The Notice of Proposed 
Rulemaking contains proposed new or modified information collection 
requirements. The Commission, as part of its continuing effort to 
reduce paperwork burdens, invites the general public and the Office of 
Management and Budget (OMB) to comment on the information collection 
requirements contained in this document, as required by the Paperwork 
Reduction Act of 1995, Public Law 104-13. Public and agency comments 
are due 60 days after the date of publication in the Federal Register. 
Comments should address: (a) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the Commission, including whether the information shall have practical 
utility; (b) the accuracy of the Commission's burden estimates; (c) 
ways to enhance the quality, utility, and clarity of the information 
collected; and (d) ways to minimize the burden of the collection of 
information on the respondents, including the use of automated 
collection techniques or other forms of information technology. In 
addition, pursuant to the Small Business Paperwork Relief Act of 2002, 
Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment 
on how we might ``further reduce the information collection burden for 
small business concerns with fewer than 25 employees.'' We note that we 
have described impacts that might affect small businesses, which 
includes most businesses with fewer than 25 employees, in the IRFA.

IX. Ordering Clauses

    270. Accordingly, it is ordered that pursuant to sections 1-4, 255, 
303(r), 403, 503, 716, and 717 of the Communications Act of 1934, as 
amended, 47 U.S.C. 151-154, 255, 303(r), 403, 503, 617, 618, this 
Notice of Proposed Rulemaking in CG Docket No. 10-145, WT Docket No. 
96-198, and CG Docket No. 10-213 is adopted.
    271. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Notice of Proposed Rulemaking, including the Initial 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of 
the Small Business Administration.

List of Subjects

47 CFR Part 1

    Administrative practice and procedure, Communications common 
carriers, Individuals with disabilities, Radio, Reporting and 
recordkeeping requirements, Satellites, Telecommunications.

47 CFR Parts 6 and 7

    Communications equipment, Individuals with disabilities, 
Telecommunications.

47 CFR Part 8

    Advanced communications services equipment, Manufacturers of 
equipment used for advanced communications services, Providers of 
advanced communications services, Individuals with disabilities, 
Recordkeeping and enforcement requirements.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Proposed Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission proposes to amend 47 parts 1, 6, 7, and 8 as 
follows:

PART 1--PRACTICE AND PROCEDURE

    1. The authority citation for part 1 reads as follows:

    Authority:  15 U.S.C. 79 et seq.; 47 U.S.C. 151, 154, 160, 201, 
225, 303, 617 and 618.

    2. Amend Sec.  1.80 by redesignating paragraphs (b)(3), (4) and (5) 
as paragraphs (b)(4), (5) and (6) and by adding new paragraph (b)(3) 
and revising newly redesignated paragraph (b)(4) to read as follows:


Sec.  1.80  Forfeiture proceedings.

* * * * *
    (b) * * *
    (3) If the violator is a manufacturer or service provider subject 
to the requirements of section 255, 716 or 718 of the Communications 
Act, and is determined by the Commission to have violated any such 
requirement, the manufacturer or service provider shall be liable to 
the United States for a forfeiture penalty of not more than $100,000 
for each violation or each day of a continuing violation, except that 
the amount assessed for any continuing violation shall not exceed a 
total of $1,000,000 for any single act or failure to act.
    (4) In any case not covered in paragraphs (b)(1), (2), or (3) of 
this section, the amount of any forfeiture penalty determined under 
this section shall not exceed $16,000 for each violation or each day of 
a continuing violation, except that the amount assessed for any 
continuing violation shall not exceed a total of $112,500 for any 
single act or failure to act described in paragraph (a) of this 
section.
* * * * *

PART 6--ACCESS TO TELECOMMUNICATIONS SERVICE, TELECOMMUNICATIONS 
EQUIPMENT AND CUSTOMER PREMISES EQUIPMENT BY PERSONS WITH 
DISABILITIES

    3. The authority citation for part 6 reads as follows:

    Authority:  47 U.S.C. 151-154, 251, 255, 303(r), 617, 618.

Subpart D--[Removed]

    4. Remove Subpart D, consisting of Sec. Sec.  6.15 through 6.23.

PART 7--ACCESS TO VOICEMAIL AND INTERACTIVE MENU SERVICES AND 
EQUIPMENT BY PEOPLE WITH DISABILITIES

    5. The authority citation for part 7 reads as follows:

    Authority:  47 U.S.C. 151, 154(i), 154(j), 208, 255, 617, 618.

Subpart D--[Removed]

    6. Remove Subpart D, consisting of Sec. Sec.  7.17 through 7.23.
    7. Add part 8 to read as follows:

PART 8--ACCESS TO ADVANCED COMMUNICATIONS SERVICES AND EQUIPMENT BY 
PEOPLE WITH DISABILITIES

Subpart A--Scope
Sec.
8.1 Applicability.
8.2 Exclusions.
8.3 Waivers.
Subpart B--Definitions
8.4 Definitions.
Subpart C--Implementation Requirements--What Must Covered Entities Do?
8.5 Obligations
8.6 Performance objectives.
8.7 through 8.15 [Reserved]
Subpart D--Recordkeeping and Enforcement
8.16 Generally.
8.17 Recordkeeping.
8.18 Informal or formal complaints.
8.19 Informal complaints; form and content.
8.20 Procedure; designation of agents for service.
8.21 Answers and replies to informal complaints.
8.22 Review and disposition of informal complaints.
8.23 General pleading requirements.
8.24 Format and content of formal complaints.
8.25 Damages.

[[Page 13838]]

8.26 Joinder of complainants and causes of action.
8.27 Answers.
8.28 Cross-complaints and counterclaims.
8.29 Replies.
8.30 Motions.
8.31 Formal complaints not stating a cause of action; defective 
pleadings.
8.32 Discovery.
8.33 Confidentiality of information produced or exchanged by the 
parties.
8.34 Other required written submissions.
8.35 Status conference.
8.36 Specifications as to pleadings, briefs, and other documents; 
subscription.
8.37 Copies; service; separate filings against multiple defendants.

    Authority:  47 U.S.C. 151-154, 255, 303, 403, 503, 617, 618 
unless otherwise noted.

Subpart A--Scope


Sec.  8.1  Applicability.

    Subject to the exclusions described in this part, the rules in this 
part apply to:
    (a) Any provider of advanced communications services, as that term 
is defined in this part, offering such services in or affecting 
interstate commerce;
    (b) Any manufacturer of equipment used for advanced communications 
services, including but not limited to end user equipment, network 
equipment, and software, that such manufacturer offers for sale or 
otherwise distributes in interstate commerce.


Sec.  8.2  Exclusions.

    (a) Subject to the exception in paragraph (c) of this section, no 
person shall be subject to the requirements of the rules in this part 
with respect to advanced communications services or the equipment used 
to provide or access such services to the extent such person transmits, 
routes, or stores in intermediate or transient storage the 
communications made available through the provision of advanced 
communications services by a third party.
    (b) Subject to the exception in paragraph (c) of this section, no 
person shall be subject to the requirements of the rules in this part 
with respect to advanced communications services or the equipment used 
to provide or access such services to the extent such person provides 
an information location tool, such as a directory, index, reference, 
pointer, menu, guide, user interface, or hypertext link, through which 
an end user obtains access to such video programming, online content, 
applications, services, advanced communications services, or equipment 
used to provide or access advanced communications services.
    (c) The exclusions in paragraphs (a) and (b) of this section shall 
not apply to any person who relies on third party applications, 
services, software, hardware, or equipment to comply with the 
requirements of this part with respect to the provision of advanced 
communications services or the manufacture of equipment used to provide 
such services.
    (d) The requirements of this part shall not apply to any equipment 
or services, including interconnected VoIP service, that were subject 
to the requirements of section 255 of the Act on October 7, 2010, which 
remain subject to section 255 of the Act, as amended, and subject to 
the rules in parts 6 and 7 of this chapter.
    (e) None of the rules in this part shall apply to customized 
equipment or services that are not offered directly to the public 
regardless of the facilities used. Also, none of the rules in this part 
shall apply to customized equipment or services that are not offered to 
such classes of users as to be effectively available to the public 
regardless of the facilities used. However, this paragraph shall not be 
construed to create an exemption for equipment or for services designed 
for and used by members of the general public.


Sec.  8.3  Waivers.

    Multi-purpose Services and Equipment:
    (a) Manufacturer. On its own motion or in response to a petition by 
a manufacturer of equipment used to provide or access advanced 
communications service or by any interested party, the Commission may 
waive the requirements of this part for a feature or function of 
equipment used to provide or access advanced communications services, 
or for any class of such equipment that:
    (1) Is capable of accessing advanced communications services and;
    (2) Is designed for multiple purposes, but is designed primarily 
for purposes other than providing or accessing advanced communications 
services.
    (b) Service Provider. On its own motion or in response to a 
petition by a provider of advanced communications services or by any 
interested party, the Commission may waive the requirements of this 
part for a feature or function of equipment used to provide or access 
advanced communications services, or for any class of such equipment 
that:
    (1) Is capable of accessing advanced communications services and;
    (2) Is designed for multiple purposes, but is designed primarily 
for purposes other than providing or accessing advanced communications 
services.

Subpart B--Definitions


Sec.  8.4  Definitions.

    (a) The term accessible shall have the meaning provided in Sec.  
8.6(b).
    (b) The term achievable shall mean with reasonable effort or 
expense, as determined by the Commission. In making such a 
determination, the Commission shall consider:
    (1) The nature and cost of the steps needed to meet the 
requirements of section 716 of the Act and this part with respect to 
the specific equipment or service in question, such that if 
accessibility to and usability by individuals with disabilities can be 
achieved only by a fundamental alteration to the specific equipment or 
service in question, then such accessibility and usability is not 
achievable;
    (2) The technical and economic impact on the operation of the 
manufacturer or provider and on the operation of the specific equipment 
or service in question, including on the development and deployment of 
new communications technologies;
    (3) The type and operations of the manufacturer or provider; and
    (4) The extent to which the service provider or manufacturer in 
question offers accessible services or equipment containing varying 
degrees of functionality and features, and offered at differing price 
points.
    (c) The term advanced communications services shall mean:
    (1) Interconnected VoIP service, as that term is defined in this 
section;
    (2) Non-interconnected VoIP service, as that term is defined in 
this section;
    (3) Electronic messaging service, as that term is defined in this 
section; and
    (4) Interoperable video conferencing service, as that term is 
defined in this section.
    (d) The term application shall mean software designed to perform or 
to help the user perform a specific task or specific tasks, such as 
communicating by voice, electronic text messaging, or video 
conferencing.
    (e) The term compatible shall have the meaning provided in Sec.  
8.6(d).
    (f) The term customer premises equipment shall mean equipment 
employed on the premises of a person (other than a carrier) to 
originate, route, or terminate telecommunications.
    (g) The term customized equipment or services shall mean equipment 
and services that are customized to unique specifications requested by 
a consumer and not otherwise available to the general public, including 
public safety networks and devices, but shall not apply to equipment 
distributed to and

[[Page 13839]]

services used by public or private sector employees, including public 
safety employees.
    (h) The term disability shall mean a physical or mental impairment 
that substantially limits one or more of the major life activities of 
an individual; a record of such an impairment; or being regarded as 
having such an impairment.
    (i) The term electronic messaging service means a service that 
provides real-time or near real-time non-voice messages in text form 
between individuals over communications networks.
    (j) The term end user equipment shall mean equipment designed for 
consumer use, including equipment designed for use by individuals with 
disabilities.
    (k) The term hardware shall mean a tangible communications device, 
equipment, or physical component of communications technology, 
including peripheral devices, such as a smart phone, a laptop computer, 
a desk top computer, a screen, a keyboard, a speaker, or an amplifier.
    (l) The term interconnected VoIP service shall have the same 
meaning as in Sec.  9.3 of this chapter.
    (m) An interoperable video conferencing service means a service 
that provides real-time video communications, including audio, to 
enable users to share information of the user's choosing.
    (n) The term manufacturer shall mean an entity that makes or 
produces a product, including equipment used for advanced 
communications services, including end user equipment, network 
equipment, and software.
    (o) The term network equipment shall mean equipment facilitating 
the use of a computer network, including routers, network interface 
cards, networking cables, modems, and other related hardware.
    (p) The term nominal cost in regard to accessibility and usability 
solutions shall mean small enough so as to generally not be a factor in 
the consumer's decision to acquire a product or service that the 
consumer otherwise desires.
    (q) A non-interconnected VoIP service is a service that:
    (1) Enables real-time voice communications that originate from or 
terminate to the user's location using Internet protocol or any 
successor protocol; and
    (2) Requires Internet protocol-compatible customer premises 
equipment (CPE); and
    (3) Is not an interconnected VoIP service.
    (r) The term peripheral devices shall mean devices employed in 
connection with equipment, including software, covered by this part to 
translate, enhance, or otherwise transform advanced communications 
services into a form accessible to individuals with disabilities.
    (s) The term proprietary technology shall mean hardware, software, 
and services such as devices, Internet service, and software 
applications, that are unique and legally owned, or for which a 
copyright or license is held, by an entity that does not offer such 
technology free or on an open source basis.
    (t) The term service provider shall mean a provider of advanced 
communications services that are offered in or affecting interstate 
commerce, including a provider of applications and services that can be 
used for advanced communications services and that can be accessed 
(i.e., downloaded or run) by users over a service provider's network.
    (u) The term software shall mean computer programs, procedures, 
rules, and related data and documentation that direct the use and 
operation of a computer or related device and instruct it to perform a 
given task or function.
    (v) The term specialized customer premises equipment shall mean 
customer premise equipment which is commonly used by individuals with 
disabilities to achieve access.
    (w) The term usable shall have the meaning provided in Sec.  
8.6(c).

Subpart C--Implementation Requirements--What Must Covered Entities 
Do?


Sec.  8.5  Obligations.

    (a) General Obligations. (1) With respect to equipment manufactured 
after the effective date of the regulations, a manufacturer of 
equipment used for advanced communications services, including end user 
equipment, network equipment, and software, must ensure that the 
equipment and software that such manufacturer offers for sale or 
otherwise distributes in interstate commerce shall be accessible to and 
usable by individuals with disabilities, unless such requirements are 
not achievable
    (2) With respect to services provided after the effective date of 
the regulations, a provider of advanced communications services must 
ensure that services offered by such provider in or affecting 
interstate commerce are accessible to and usable by individuals with 
disabilities, unless such requirements are not achievable.
    (3) If accessibility is not achievable either by building it in or 
by using third party accessibility solutions, then a manufacturer or 
service provider shall ensure that its equipment or service is 
compatible with existing peripheral devices or specialized customer 
premises equipment.
    (4) Providers of advanced communications services shall not install 
network features, functions, or capabilities that impede accessibility 
or usability.
    (5) Advanced communications services and the equipment and networks 
used with these services may not impair or impede the accessibility of 
information content when accessibility has been incorporated into that 
content for transmission through such services, equipment or networks.
    (b) Product design, development, and evaluation. (1) Manufacturers 
and service providers must consider performance objectives set forth in 
Sec.  8.7 at the design stage as early and as consistently as possible 
and must implement such evaluation to the extent that it is achievable.
    (2) Manufacturers and service providers must identify barriers to 
accessibility and usability as part of such evaluation.
    (c) Information Pass Through. Equipment used for advanced 
communications services, including end user equipment, network 
equipment, and software must pass through cross-manufacturer, 
nonproprietary, industry-standard codes, translation protocols, formats 
or other information necessary to provide advanced communications 
services in an accessible format, if achievable. Signal compression 
technologies shall not remove information needed for access or shall 
restore it upon decompression.
    (d) Information, documentation, and training. Manufacturers and 
service providers must ensure access to information and documentation 
they provide to customers, if achievable. Such information and 
documentation includes user guides, bills, installation guides for end 
user devices, and product support communications, in alternate formats, 
as needed. The requirement to provide access to information also 
includes ensuring that individuals with disabilities can access, at no 
extra cost, call centers and customer support regarding both the 
product generally and the accessibility features of the product.


Sec.  8.6  Performance objectives.

    (a) Generally--Manufacturers and service providers shall ensure 
that equipment and services covered by this part are accessible, 
usable, and compatible as those terms are defined in

[[Page 13840]]

paragraphs (b) through (d) of this section.
    (b) Accessible--The term accessible shall mean that:
    (1) Input, control, and mechanical functions shall be locatable, 
identifiable, and operable in accordance with each of the following, 
assessed independently:
    (i) Operable without vision. Provide at least one mode that does 
not require user vision.
    (ii) Operable with low vision and limited or no hearing. Provide at 
least one mode that permits operation by users with visual acuity 
between 20/70 and 20/200, without relying on audio output.
    (iii) Operable with little or no color perception. Provide at least 
one mode that does not require user color perception.
    (iv) Operable without hearing. Provide at least one mode that does 
not require user auditory perception.
    (v) Operable with limited manual dexterity. Provide at least one 
mode that does not require user fine motor control or simultaneous 
actions.
    (vi) Operable with limited reach and strength. Provide at least one 
mode that is operable with user limited reach and strength.
    (vii) Operable with a Prosthetic Device. Controls shall be operable 
without requiring body contact or close body proximity.
    (viii) Operable without time-dependent controls. Provide at least 
one mode that does not require a response time or allows response time 
to be by-passed or adjusted by the user over a wide range.
    (ix) Operable without speech. Provide at least one mode that does 
not require user speech.
    (x) Operable with limited cognitive skills. Provide at least one 
mode that minimizes the cognitive, memory, language, and learning 
skills required of the user.
    (2) All information necessary to operate and use the product, 
including but not limited to, text, static or dynamic images, icons, 
labels, sounds, or incidental operating cues, [shall] comply with each 
of the following, assessed independently:
    (i) Availability of visual information. Provide visual information 
through at least one mode in auditory form.
    (ii) Availability of visual information for low vision users. 
Provide visual information through at least one mode to users with 
visual acuity between 20/70 and 20/200 without relying on audio.
    (iii) Access to moving text. Provide moving text in at least one 
static presentation mode at the option of the user.
    (iv) Availability of auditory information. Provide auditory 
information through at least one mode in visual form and, where 
appropriate, in tactile form.
    (v) Availability of auditory information for people who are hard of 
hearing. Provide audio or acoustic information, including any auditory 
feedback tones that are important for the use of the product, through 
at least one mode in enhanced auditory fashion (i.e., increased 
amplification, increased signal-to-noise ratio, or combination).
    (vi) Prevention of visually-induced seizures. Visual displays and 
indicators shall minimize visual flicker that might induce seizures in 
people with photosensitive epilepsy.
    (vii) Availability of audio cutoff. Where a product delivers audio 
output through an external speaker, provide an industry standard 
connector for headphones or personal listening devices (e.g., phone-
like handset or earcup) which cuts off the speaker(s) when used.
    (viii) Non-interference with hearing technologies. Reduce 
interference to hearing technologies (including hearing aids, cochlear 
implants, and assistive listening devices) to the lowest possible level 
that allows a user to utilize the product.
    (ix) Hearing aid coupling. Where a product delivers output by an 
audio transducer which is normally held up to the ear, provide a means 
for effective wireless coupling to hearing aids.
    (c) Usable: The term usable shall mean that individuals with 
disabilities have access to the full functionality and documentation 
for the product, including instructions, product information (including 
accessible feature information), documentation and technical support 
functionally equivalent to that provided to individuals without 
disabilities.
    (d) Compatible: The term compatible shall mean compatible with 
peripheral devices and specialized customer premises equipment, and in 
compliance with the following provisions, as applicable:
    (1) External electronic access to all information and control 
mechanisms. Information needed for the operation of products (including 
output, alerts, icons, on-line help, and documentation) shall be 
available in a standard electronic text format on a cross-industry 
standard port and all input to and control of a product shall allow for 
real time operation by electronic text input into a cross-industry 
standard external port and in cross-industry standard format. The 
cross-industry standard port shall not require manipulation of a 
connector by the user.
    (2) Connection point for external audio processing devices. 
Products providing auditory output shall provide the auditory signal at 
a standard signal level through an industry standard connector.
    (3) TTY connectability. Products that provide a function allowing 
voice communication and which do not themselves provide a TTY 
functionality shall provide a standard non-acoustic connection point 
for TTYs. It shall also be possible for the user to easily turn any 
microphone on and off to allow the user to intermix speech with TTY 
use.
    (4) TTY signal compatibility. Products, including those providing 
voice communication functionality, shall support use of all cross-
manufacturer non-proprietary standard signals used by TTYs.


Sec. Sec.  8.7-8.15  [Reserved]

Subpart D--Recordkeeping and Enforcement


Sec.  8.16  Generally.

    (a) The rules in this subpart regarding recordkeeping and 
enforcement are applicable to all manufacturers and service providers 
that are subject to the requirements of sections 255, 716, and 718 of 
the Act.
    (b) The requirements set forth in Sec.  8.17 of this subpart shall 
be effective [DATE ONE YEAR AFTER THE EFFECTIVE DATE OF THE FINAL 
RULE].


Sec.  8.17  Recordkeeping.

    (a) Each manufacturer and service provider subject to sections 255, 
716, or 718 of the Act, must maintain, in the ordinary course of 
business and for a reasonable period, records of the efforts taken by 
such manufacturer or provider to implement sections 255, 716, and 718, 
as applicable, including:
    (1) Information about the manufacturer's or service provider's 
efforts to consult with individuals with disabilities;
    (2) Descriptions of the accessibility features of its products and 
services; and
    (3) Information about the compatibility of its products and 
services with peripheral devices or specialized customer premise 
equipment commonly used by individuals with disabilities to achieve 
access.
    (b) An officer of each manufacturer and service provider subject to 
section 255, 716, or 718 of the Act, must sign and file an annual 
compliance certificate with the Commission. The

[[Page 13841]]

officer must state in the certificate that he or she has personal 
knowledge that the manufacturer or service provider has established 
operating procedures that are adequate to ensure compliance with the 
rules in this subpart and that records are being kept in accordance 
with this section. The certificate shall identify the agent designated 
for service pursuant to Sec.  8.20(b) of this subpart and provide 
contact information for this agent.
    (c) Upon the service of a complaint, formal or informal, on a 
manufacturer or service provider under this section, a copy of the 
records maintained by the manufacturer or service provider that are 
directly relevant to the equipment or service that is the subject of 
the complaint shall be provided to the Commission in accordance with 
Sec.  8.21(a) of this subpart. Requests for confidential treatment of 
documents or information submitted under this section may be filed in 
accordance with Sec.  0.459 of this chapter.
    (d) In response to a filed formal or informal complaint, a 
manufacturer or service provider may, instead of providing a duplicate 
document, record or other information directly related to the equipment 
or service that is the subject of the complaint, direct the Commission 
to documents or records already in the Commission's possession by 
providing sufficient specificity for Commission staff to locate the 
relevant record or document or portion thereof, including (title of 
proceeding or report, date, page/para. s, etc.).


Sec.  8.18  Informal or formal complaints.

    Complaints against manufacturers or service providers, as defined 
under this subpart, for alleged violations of this subpart may be 
either informal or formal.


Sec.  8.19  Informal complaints; form and content.

    (a) An informal complaint alleging a violation of sections 255, 716 
or 718 of the Act or this chapter may be transmitted to the Commission 
via any reasonable means, e.g., letter, facsimile transmission, 
telephone (202-418-2517 (voice); 202-418-2922 (TTY)), Internet-e-mail 
([email protected]), audio-cassette recording, and Braille.
    (b) An informal complaint shall include:
    (1) The name, address, e-mail address, and telephone number of the 
complainant;
    (2) The name and address of the manufacturer or service provider 
defendant against whom the complaint is made;
    (3) The date or dates on which the complainant or person on whose 
behalf the complaint is being filed either purchased, acquired, or used 
or attempted to purchase, acquire, or use the equipment or service 
about which the complaint is being made;
    (4) A complete statement of fact explaining why the complainant 
contends that the defendant manufacturer or provider is in violation of 
section 255, 716 or 718 of the Act or this chapter, including details 
regarding the service or equipment and the relief requested, and all 
documentation that supports the complainant's contention;
    (5) The complainant's preferred format or method of response to the 
complaint by the Commission and defendant (e.g., letter, facsimile 
transmission, telephone (voice/TRS/TTY), Internet e-mail, audio-
cassette recording, Braille; or some other method that will best 
accommodate the complainant's disability, if any; and
    (6) Any other information that is required by the Commission's 
accessibility complaint form.


Sec.  8.20  Procedure; designation of agents for service.

    (a) The Commission shall promptly forward any informal complaint 
meeting the requirements of Sec.  8.19 of this subpart to each 
manufacturer and service provider named in or determined by the staff 
to be implicated by the complaint.
    (b) To ensure prompt and effective service of informal and formal 
complaints filed under this subpart, every manufacturer and service 
provider subject to the requirements of section 255, 716, or 718 of the 
Act and this subpart, shall designate an agent, and may designate 
additional agents if it so chooses, upon whom service may be made of 
all notices, inquiries, orders, decisions, and other pronouncements of 
the Commission in any matter before the Commission. Such designation 
shall include, for the manufacturer or the service provider, a name or 
department designation, business address, telephone number, and, if 
available TTY number, facsimile number, and Internet e-mail address.


Sec.  8.21  Answers and replies to informal complaints.

    (a) Any manufacturer or service provider to whom an informal 
complaint is directed by the Commission under this subpart shall file 
and serve an answer. The answer shall:
    (1) Be filed with the Commission and served on the complainant 
within twenty days of service of the complaint, unless the Commission 
or its staff specifies another time period;
    (2) Respond specifically to each material allegation in the 
complaint;
    (3) Set forth the steps taken by the manufacturer or service 
provider to make the product or service accessible and usable;
    (4) Set forth the procedures and processes used by the manufacturer 
or service provider to evaluate whether it was achievable to make the 
product or service accessible and usable;
    (5) Set forth the names, titles, and responsibilities of each 
decision maker in the evaluation process;
    (6) Set forth the manufacturer's basis for determining that it was 
not achievable to make the product or service accessible and usable;
    (7) Provide all documents supporting the manufacturer's or service 
provider's conclusion that it was not achievable to make the product or 
service accessible and usable;
    (8) Include a certification by an officer of the manufacturer or 
service provider that it was not achievable to make the product or 
service accessible and usable;
    (9) Set forth any claimed defenses;
    (10) Set forth any remedial actions already taken or proposed 
alternative relief without any prejudice to any denials or defenses 
raised;
    (11) Provide any other information or materials specified by the 
Commission as relevant to its consideration of the complaint; and
    (12) Must be prepared or formatted in the manner requested by the 
Commission and the complainant, unless otherwise permitted by the 
Commission for good cause shown.
    (b) The complainant may file and serve a reply. The reply shall:
    (1) Be served on the Commission and the complainant within ten days 
after service of answer, unless otherwise directed by the Commission;
    (2) Be responsive to matters contained in the answer and shall not 
contain new matters.


Sec.  8.22  Review and disposition of informal complaints.

    (a) The Commission will investigate the allegations in any informal 
complaint filed that satisfies the requirements of Sec.  8.18(b) of 
this subpart, and, within 180 days after the date on which such 
complaint was filed with the Commission, issue an order finding whether 
the manufacturer or service provider that is the subject of the 
complaint violated section 255, 716, or 718 of the Act, or the 
Commission's implementing rules, and provide a basis therefor, unless 
such complaint is resolved before that time.
    (b) If the Commission determines in an order issued pursuant to 
paragraph

[[Page 13842]]

(a) of this section that the manufacturer or service provider violated 
section 255, 716, or 718 of the Act, or the Commission's implementing 
rules, the Commission may, in such order, or in a subsequent order:
    (1) Direct the manufacturer or service provider to bring the 
service, or in the case of a manufacturer, the next generation of the 
equipment or device, into compliance with the requirements of sections 
255, 716, or 718 of the Act, and the Commission's rules, within a 
reasonable period of time; and
    (2) Take such other enforcement action as the Commission is 
authorized and as it deems appropriate.
    (c) Any manufacturer or service provider that is the subject of an 
order issued pursuant to paragraph (b)(1) of this section shall have a 
reasonable opportunity, as established by the Commission, to comment on 
the Commission's proposed remedial action before the Commission issues 
a final order with respect to that action.


Sec.  8.23  General pleading requirements.

    Formal complaint proceedings are generally resolved on a written 
record consisting of a complaint, answer, and joint statement of 
stipulated facts, disputed facts and key legal issues, along with all 
associated affidavits, exhibits and other attachments. Commission 
proceedings may also require or permit other written submissions such 
as briefs, written interrogatories, and other supplementary documents 
or pleadings.
    (a) Pleadings must be clear, concise, and explicit. All matters 
concerning a claim, defense or requested remedy, including damages, 
should be pleaded fully and with specificity.
    (b) Pleadings must contain facts which, if true, are sufficient to 
constitute a violation of the Act or Commission order or regulation, or 
a defense to such alleged violation.
    (c) Facts must be supported by relevant documentation or affidavit.
    (d) Legal arguments must be supported by appropriate judicial, 
Commission, or statutory authority.
    (e) Opposing authorities must be distinguished.
    (f) Copies must be provided of all non-Commission authorities 
relied upon which are not routinely available in national reporting 
systems, such as unpublished decisions or slip opinions of courts or 
administrative agencies.
    (g) Parties are responsible for the continuing accuracy and 
completeness of all information and supporting authority furnished in a 
pending complaint proceeding. Information submitted, as well as 
relevant legal authorities, must be current and updated as necessary 
and in a timely manner at any time before a decision is rendered on the 
merits of the complaint.
    (h) All statements purporting to summarize or explain Commission 
orders or policies must cite, in standard legal form, the Commission 
ruling upon which such statements are based.
    (i) Pleadings shall identify the name, address, telephone number, 
and facsimile transmission number for either the filing party's 
attorney or, where a party is not represented by an attorney, the 
filing party.


Sec.  8.24  Format and content of formal complaints.

    (a) Subject to paragraph (e) of this section governing supplemental 
complaints filed pursuant to Sec.  8.25 of this subpart, a formal 
complaint shall contain:
    (1) The name of each complainant and defendant;
    (2) The occupation, address and telephone number of each 
complainant and, to the extent known, each defendant;
    (3) The name, address, and telephone number of complainant's 
attorney, if represented by counsel;
    (4) Citation to the section of the Communications Act and/or order 
and/or regulation of the Commission alleged to have been violated.
    (5) A complete statement of facts which, if proven true, would 
constitute such a violation. All material facts must be supported, 
pursuant to the requirements of Sec.  8.30(c) of this subpart and 
paragraph (a)(11) of this section, by relevant affidavits and 
documentation, including copies of relevant written agreements, offers, 
counter-offers, denials, or other related correspondence. The statement 
of facts shall include a detailed explanation of the manner and time 
period in which a defendant has allegedly violated the Act, Commission 
order, or Commission rule in question, including a full identification 
or description of the communications, transmissions, services, or other 
carrier conduct complained of and the nature of any injury allegedly 
sustained by the complainant. Assertions based on information and 
belief are expressly prohibited unless made in good faith and 
accompanied by an affidavit explaining the basis for the plaintiff's 
belief and why the complainant could not reasonably ascertain the facts 
from the defendant or any other source;
    (6) Proposed findings of fact, conclusions of law, and legal 
analysis relevant to the claims and arguments set forth in the 
complaint;
    (7) The relief sought, including recovery of damages and the amount 
of damages claimed, if known;
    (8) Certification that the complainant has, in good faith, 
discussed or attempted to discuss the possibility of settlement with 
each defendant prior to the filing of the formal complaint. Such 
certification shall include a statement that, prior to the filing of 
the complaint, the complainant mailed a certified letter outlining the 
allegations that form the basis of the complaint it anticipated filing 
with the Commission to the defendant carrier or one of the defendant's 
registered agents for service of process that invited a response within 
a reasonable period of time and a brief summary of all additional steps 
taken to resolve the dispute prior to the filing of the formal 
complaint. If no additional steps were taken, such certificate shall 
state the reason(s) why the complainant believed such steps would be 
fruitless;
    (9) Whether a separate action has been filed with the Commission, 
any court, or other government agency that is based on the same claim 
or same set of facts, in whole or in part, or whether the complaint 
seeks prospective relief identical to the relief proposed or at issue 
in a notice-and-comment proceeding that is concurrently before the 
Commission;
    (10) An information designation containing:
    (i) The name, address, and position of each individual believed to 
have firsthand knowledge of the facts alleged with particularity in the 
complaint, along with a description of the facts within any such 
individual's knowledge;
    (ii) A description of all documents, data compilations and tangible 
things in the complainant's possession, custody, or control, that are 
relevant to the facts alleged with particularity in the complaint. Such 
description shall include for each document:
    (A) The date it was prepared, mailed, transmitted, or otherwise 
disseminated;
    (B) The author, preparer, or other source;
    (C) The recipient(s) or intended recipient(s);
    (D) Its physical location; and
    (E) A description of its relevance to the matters contained in the 
complaint; and
    (iii) A complete description of the manner in which the complainant 
identified all persons with information and designated all documents, 
data compilations and tangible things as being relevant to the dispute, 
including, but not limited to, identifying the individual(s) that 
conducted the information search and the criteria used

[[Page 13843]]

to identify such persons, documents, data compilations, tangible 
things, and information;
    (11) Copies of all affidavits, documents, data compilations and 
tangible things in the complainant's possession, custody, or control, 
upon which the complainant relies or intends to rely to support the 
facts alleged and legal arguments made in the complaint;
    (12) A completed Formal Complaint Intake Form;
    (13) A declaration, under penalty of perjury, by the complainant or 
complainant's counsel describing the amount, method, and the 
complainant's 10-digit FCC Registration Number, if any;
    (14) A certificate of service; and
    (15) A FCC Registration Number is required under part 1, subpart W. 
Submission of a complaint without the FCC Registration Number as 
required by part 1, subpart W will result in dismissal of the 
complaint.
    (b) The following format may be used in cases to which it is 
applicable, with such modifications as the circumstances may render 
necessary:

Before the Federal Communications Commission, Washington, DC 20554

In the matter of
Complainant,
v.
Defendant.
File No. (To be inserted by the Enforcement Bureau)

Complaint

To: The Commission.
The complainant (here insert full name of each complainant and, if a 
corporation, the corporate title of such complainant) shows that:
(1) (Here state post office address, and telephone number of each 
complainant).
(2) (Here insert the name, and, to the extent known, address and 
telephone number of defendants).
(3) (Here insert fully and clearly the specific act or thing 
complained of, together with such facts as are necessary to give a 
full understanding of the matter, including relevant legal and 
documentary support).
Wherefore, complainant asks (here state specifically the relief 
desired).
(Date)
(Name of each complainant)
(Name, address, and telephone number of attorney, if any)

    (c) The complainant may petition the staff, pursuant to Sec.  1.3 
of this chapter, for a waiver of any of the requirements of this 
section. Such waiver may be granted for good cause shown.
    (d) Supplemental complaints:
    (1) Supplemental complaints filed pursuant to Sec.  8.25 shall 
conform to the requirements set out in this section and Sec.  8.23 of 
this subpart, except that the requirements in Sec. Sec.  8.23(b), 
8.24(a)(4), (a)(5), (a)(8), (a)(9), (a)(12), and (a)(13) of this 
subpart shall not apply to such supplemental complaints;
    (2) In addition, supplemental complaints filed pursuant to Sec.  
8.25 of this subpart shall contain a complete statement of facts which, 
if proven true, would support complainant's calculation of damages for 
each category of damages for which recovery is sought. All material 
facts must be supported, pursuant to the requirements of Sec.  8.23(c) 
of this subpart and paragraph (a)(11) of this section, by relevant 
affidavits and other documentation. The statement of facts shall 
include a detailed explanation of the matters relied upon, including a 
full identification or description of the communications, 
transmissions, services, or other matters relevant to the calculation 
of damages and the nature of any injury allegedly sustained by the 
complainant. Assertions based on information and belief are expressly 
prohibited unless made in good faith and accompanied by an affidavit 
explaining the basis for the complainant's belief and why the 
complainant could not reasonably ascertain the facts from the defendant 
or any other source;
    (3) Supplemental complaints filed pursuant to Sec.  8.25 of this 
subpart shall contain a certification that the complainant has, in good 
faith, discussed or attempted to discuss the possibility of settlement 
with respect to damages for which recovery is sought with each 
defendant prior to the filing of the supplemental complaint. Such 
certification shall include a statement that, no later than 30 days 
after the release of the liability order, the complainant mailed a 
certified letter to the primary individual who represented the 
defendant carrier during the initial complaint proceeding outlining the 
allegations that form the basis of the supplemental complaint it 
anticipates filing with the Commission and inviting a response from the 
carrier within a reasonable period of time. The certification shall 
also contain a brief summary of all additional steps taken to resolve 
the dispute prior to the filing of the supplemental complaint. If no 
additional steps were taken, such certification shall state the 
reason(s) why the complainant believed such steps would be fruitless.


Sec.  8.25  Damages.

    (a) A complaint against a common carrier may seek damages. If a 
complainant wishes to recover damages, the complaint must contain a 
clear and unequivocal request for damages.
    (b) If a complainant wishes a determination of damages to be made 
in the same proceeding as the determinations of liability and 
prospective relief, the complaint must contain the allegations and 
information required by paragraph (h) of this section.
    (c) Notwithstanding paragraph (b) of this section, in any 
proceeding to which no statutory deadline applies, if the Commission 
decides that a determination of damages would best be made in a 
proceeding that is separate from and subsequent to the proceeding in 
which the determinations of liability and prospective relief are made, 
the Commission may at any time order that the initial proceeding will 
determine only liability and prospective relief, and that a separate, 
subsequent proceeding initiated in accordance with paragraph (e) of 
this section will determine damages.
    (d) If a complainant wishes a determination of damages to be made 
in a proceeding that is separate from and subsequent to the proceeding 
in which the determinations of liability and prospective relief are 
made, the complainant must:
    (1) Comply with paragraph (a) of this section, and
    (2) State clearly and unequivocally that the complainant wishes a 
determination of damages to be made in a proceeding that is separate 
from and subsequent to the proceeding in which the determinations of 
liability and prospective relief will be made.
    (e) If a complainant proceeds pursuant to paragraph (d) of this 
section, or if the Commission invokes its authority under paragraph (c) 
of this section, the complainant may initiate a separate proceeding to 
obtain a determination of damages by filing a supplemental complaint 
that complies with Sec.  8.24(d) of this subpart and paragraph (h) of 
this section within sixty days after public notice (as defined in Sec.  
1.4(b) of this chapter) of a decision that contains a finding of 
liability on the merits of the original complaint.
    (f) If a complainant files a supplemental complaint for damages in 
accordance with paragraph (e) of this section, the supplemental 
complaint shall be deemed, for statutory limitations purposes, to 
relate back to the date of the original complaint.
    (g) Where a complainant chooses to seek the recovery of damages 
upon a supplemental complaint in accordance with the requirements of 
paragraph (e) of this section, the Commission will resolve the 
separate, preceding liability complaint within any applicable

[[Page 13844]]

complaint resolution deadlines contained in the Act.
    (h) In all cases in which recovery of damages is sought, it shall 
be the responsibility of the complainant to include, within either the 
complaint or supplemental complaint for damages filed in accordance 
with paragraph (e) of this section, either:
    (1) A computation of each and every category of damages for which 
recovery is sought, along with an identification of all relevant 
documents and materials or such other evidence to be used by the 
complainant to determine the amount of such damages; or
    (2) An explanation of:
    (i) The information not in the possession of the complaining party 
that is necessary to develop a detailed computation of damages;
    (ii) Why such information is unavailable to the complaining party;
    (iii) The factual basis the complainant has for believing that such 
evidence of damages exists;
    (iv) A detailed outline of the methodology that would be used to 
create a computation of damages with such evidence.
    (i) Where a complainant files a supplemental complaint for damages 
in accordance with paragraph (e) of this section, the following 
procedures may apply:
    (1) Issues concerning the amount, if any, of damages may be either 
designated by the Enforcement Bureau for hearing before, or, if the 
parties agree, submitted for mediation to, a Commission Administrative 
Law Judge. Such Administrative Law Judge shall be chosen in the 
following manner:
    (i) By agreement of the parties and the Chief Administrative Law 
Judge; or
    (ii) In the absence of such agreement, the Chief Administrative Law 
Judge shall designate the Administrative Law Judge.
    (2) The Commission may, in its discretion, order the defendant 
either to post a bond for, or deposit into an interest bearing escrow 
account, a sum equal to the amount of damages which the Commission 
finds, upon preliminary investigation, is likely to be ordered after 
the issue of damages is fully litigated, or some lesser sum which may 
be appropriate, provided the Commission finds that the grant of this 
relief is favored on balance upon consideration of the following 
factors:
    (i) The complainant's potential irreparable injury in the absence 
of such deposit;
    (ii) The extent to which damages can be accurately calculated;
    (iii) The balance of the hardships between the complainant and the 
defendant; and
    (iv) Whether public interest considerations favor the posting of 
the bond or ordering of the deposit.
    (3) The Commission may, in its discretion, suspend ongoing damages 
proceedings for fourteen days, to provide the parties with a time 
within which to pursue settlement negotiations and/or alternative 
dispute resolution procedures.
    (4) The Commission may, in its discretion, end adjudication of 
damages with a determination of the sufficiency of a damages 
computation method or formula. No such method or formula shall contain 
a provision to offset any claim of the defendant against the 
complainant. The parties shall negotiate in good faith to reach an 
agreement on the exact amount of damages pursuant to the Commission-
mandated method or formula. Within thirty days of the release date of 
the damages order, parties shall submit jointly to the Commission 
either:
    (i) A statement detailing the parties' agreement as to the amount 
of damages;
    (ii) A statement that the parties are continuing to negotiate in 
good faith and a request that the parties be given an extension of time 
to continue negotiations; or
    (iii) A statement detailing the bases for the continuing dispute 
and the reasons why no agreement can be reached.
    (j) Except where otherwise indicated, the rules governing initial 
formal complaint proceedings govern supplemental formal complaint 
proceedings, as well.


Sec.  8.26  Joinder of complainants and causes of action.

    (a) Two or more complainants may join in one complaint if their 
respective causes of action are against the same defendant and concern 
substantially the same facts and alleged violation of the 
Communications Act.
    (b) Two or more grounds of complaint involving the same principle, 
subject, or statement of facts may be included in one complaint, but 
should be separately stated and numbered.


Sec.  8.27  Answers.

    (a) Any defendant upon whom copy of a formal complaint is served 
shall answer such complaint in the manner prescribed under this section 
within twenty days of service of the formal complaint by the 
complainant, unless otherwise directed by the Commission.
    (b) The answer shall advise the complainant and the Commission 
fully and completely of the nature of any defense, and shall respond 
specifically to all material allegations of the complaint. Every effort 
shall be made to narrow the issues in the answer. The defendant shall 
state concisely its defense to each claim asserted, admit or deny the 
averments on which the complainant relies, and state in detail the 
basis for admitting or denying such averment. General denials are 
prohibited. Denials based on information and belief are expressly 
prohibited unless made in good faith and accompanied by an affidavit 
explaining the basis for the defendant's belief and why the defendant 
could not reasonably ascertain the facts from the complainant or any 
other source. If the defendant is without knowledge or information 
sufficient to form a belief as to the truth of an averment, the 
defendant shall so state and this has the effect of a denial. When a 
defendant intends in good faith to deny only part of an averment, the 
defendant shall specify so much of it as is true and shall deny only 
the remainder. The defendant may deny the allegations of the complaint 
as specific denials of either designated averments or paragraphs.
    (c) The answer shall contain proposed findings of fact, conclusions 
of law, and legal analysis relevant to the claims and arguments set 
forth in the answer.
    (d) Averments in a complaint or supplemental complaint filed 
pursuant to Sec.  8.25 of this subpart are deemed to be admitted when 
not denied in the answer.
    (e) Affirmative defenses to allegations contained in the complaint 
shall be specifically captioned as such and presented separately from 
any denials made in accordance with paragraph (c) of this section.
    (f) The answer shall include an information designation containing:
    (1) The name, address, and position of each individual believed to 
have firsthand knowledge of the facts alleged with particularity in the 
answer, along with a description of the facts within any such 
individual's knowledge;
    (2) A description of all documents, data compilations and tangible 
things in the defendant's possession, custody, or control, that are 
relevant to the facts alleged with particularity in the answer. Such 
description shall include for each document:
    (i) The date it was prepared, mailed, transmitted, or otherwise 
disseminated;
    (ii) The author, preparer, or other source;
    (iii) The recipient(s) or intended recipient(s);
    (iv) Its physical location; and

[[Page 13845]]

    (v) A description of its relevance to the matters in dispute.
    (3) A complete description of the manner in which the defendant 
identified all persons with information and designated all documents, 
data compilations and tangible things as being relevant to the dispute, 
including, but not limited to, identifying the individual(s) that 
conducted the information search and the criteria used to identify such 
persons, documents, data compilations, tangible things, and 
information.
    (g) The answer shall attach copies of all affidavits, documents, 
data compilations and tangible things in the defendant's possession, 
custody, or control, upon which the defendant relies or intends to rely 
to support the facts alleged and legal arguments made in the answer.
    (h) The answer shall contain certification that the defendant has, 
in good faith, discussed or attempted to discuss, the possibility of 
settlement with the complainant prior to the filing of the formal 
complaint. Such certification shall include a brief summary of all 
steps taken to resolve the dispute prior to the filing of the formal 
complaint. If no such steps were taken, such certificate shall state 
the reason(s) why the defendant believed such steps would be fruitless;
    (i) The defendant may petition the staff, pursuant to Sec.  1.3 of 
this chapter, for a waiver of any of the requirements of this section. 
Such waiver may be granted for good cause shown.


Sec.  8.28  Cross-complaints and counterclaims.

    Cross-complaints seeking any relief within the jurisdiction of the 
Commission against any party (complainant or defendant) to that 
proceeding are expressly prohibited. Any claim that might otherwise 
meet the requirements of a cross-complaint may be filed as a separate 
complaint in accordance with Sec. Sec.  8.23 through 8.37 of this 
subpart. For purposes of this subpart, the term ``cross-complaint'' 
shall include counterclaims.


Sec.  8.29  Replies.

    (a) Within three days after service of an answer containing 
affirmative defenses presented in accordance with the requirements of 
Sec.  8.27(e) of this subpart, a complainant may file and serve a reply 
containing statements of relevant, material facts and legal arguments 
that shall be responsive to only those specific factual allegations and 
legal arguments made by the defendant in support of its affirmative 
defenses. Replies which contain other allegations or arguments will not 
be accepted or considered by the Commission.
    (b) Failure to reply to an affirmative defense shall be deemed an 
admission of such affirmative defense and of any facts supporting such 
affirmative defense that are not specifically contradicted in the 
complaint.
    (c) The reply shall contain proposed findings of fact, conclusions 
of law, and legal analysis relevant to the claims and arguments set 
forth in the reply.
    (d) The reply shall include an information designation containing:
    (1) The name, address and position of each individual believed to 
have firsthand knowledge about the facts alleged with particularity in 
the reply, along with a description of the facts within any such 
individual's knowledge.
    (2) A description of all documents, data compilations and tangible 
things in the complainant's possession, custody, or control that are 
relevant to the facts alleged with particularity in the reply. Such 
description shall include for each document:
    (i) The date prepared, mailed, transmitted, or otherwise 
disseminated;
    (ii) The author, preparer, or other source;
    (iii) The recipient(s) or intended recipient(s);
    (iv) Its physical location; and
    (v) A description of its relevance to the matters in dispute.
    (3) A complete description of the manner in which the complainant 
identified all persons with information and designated all documents, 
data compilations and tangible things as being relevant to the dispute, 
including, but not limited to, identifying the individual(s) that 
conducted the information search and the criteria used to identify such 
persons, documents, data compilations, tangible things, and 
information;
    (e) The reply shall attach copies of all affidavits, documents, 
data compilations and tangible things in the complainant's possession, 
custody, or control upon which the complainant relies or intends to 
rely to support the facts alleged and legal arguments made in the 
reply.
    (f) The complainant may petition the staff, pursuant to Sec.  1.3 
of this chapter, for a waiver of any of the requirements of this 
section. Such waiver may be granted for good cause shown.


Sec.  8.30  Motions.

    (a) A request to the Commission for an order shall be by written 
motion, stating with particularity the grounds and authority therefor, 
and setting forth the relief or order sought.
    (b) All dispositive motions shall contain proposed findings of fact 
and conclusions of law, with supporting legal analysis, relevant to the 
contents of the pleading. Motions to compel discovery must contain a 
certification by the moving party that a good faith attempt to resolve 
the dispute was made prior to filing the motion. All facts relied upon 
in motions must be supported by documentation or affidavits pursuant to 
the requirements of Sec.  8.23(c) of this subpart, except for those 
facts of which official notice may be taken.
    (c) The moving party shall provide a proposed order for adoption, 
which appropriately incorporates the basis therefor, including proposed 
findings of fact and conclusions of law relevant to the pleading. The 
proposed order shall be clearly marked as a ``Proposed Order.'' The 
proposed order shall be submitted both as a hard copy and on computer 
disk in accordance with the requirements of Sec.  8.36(d) of this 
subpart. Where appropriate, the proposed order format should conform to 
that of a reported FCC order.
    (d) Oppositions to any motion shall be accompanied by a proposed 
order for adoption, which appropriately incorporates the basis 
therefor, including proposed findings of fact and conclusions of law 
relevant to the pleading. The proposed order shall be clearly captioned 
as a ``Proposed Order.'' The proposed order shall be submitted both as 
a hard copy and on computer disk in accordance with the requirements of 
Sec.  8.36(d) of this subpart. Where appropriate, the proposed order 
format should conform to that of a reported FCC order.
    (e) Oppositions to motions may be filed and served within five 
business days after the motion is filed and served and not after. 
Oppositions shall be limited to the specific issues and allegations 
contained in such motion; when a motion is incorporated in an answer to 
a complaint, the opposition to such motion shall not address any issues 
presented in the answer that are not also specifically raised in the 
motion. Failure to oppose any motion may constitute grounds for 
granting of the motion.
    (f) No reply may be filed to an opposition to a motion.
    (g) Motions seeking an order that the allegations in the complaint 
be made more definite and certain are prohibited.
    (h) Amendments or supplements to complaints to add new claims or 
requests for relief are prohibited. Parties are responsible, however, 
for the continuing accuracy and completeness of all information and 
supporting

[[Page 13846]]

authority furnished in a pending complaint proceeding as required under 
Sec.  8.23(g) of this subpart.


Sec.  8.31  Formal complaints not stating a cause of action; defective 
pleadings.

    (a) Any document purporting to be a formal complaint which does not 
state a cause of action under the Communications Act or a Commission 
rule or order will be dismissed. In such case, any amendment or 
supplement to such document will be considered a new filing which must 
be made within the statutory periods of limitations of actions 
contained in section 415 of the Communications Act.
    (b) Any other pleading filed in a formal complaint proceeding not 
in conformity with the requirements of the applicable rules in this 
part may be deemed defective. In such case the Commission may strike 
the pleading or request that specified defects be corrected and that 
proper pleadings be filed with the Commission and served on all parties 
within a prescribed time as a condition to being made a part of the 
record in the proceeding.


Sec.  8.32  Discovery.

    (a) A complainant may file with the Commission and serve on a 
defendant, concurrently with its complaint, a request for up to ten 
written interrogatories. A defendant may file with the Commission and 
serve on a complainant, during the period starting with the service of 
the complaint and ending with the service of its answer, a request for 
up to ten written interrogatories. A complainant may file with the 
Commission and serve on a defendant, within three calendar days of 
service of the defendant's answer, a request for up to five written 
interrogatories. Subparts of any interrogatory will be counted as 
separate interrogatories for purposes of compliance with this limit. 
Requests for interrogatories filed and served pursuant to this 
procedure may be used to seek discovery of any non-privileged matter 
that is relevant to the material facts in dispute in the pending 
proceeding, provided, however, that requests for interrogatories filed 
and served by a complainant after service of the defendant's answer 
shall be limited in scope to specific factual allegations made by the 
defendant in support of its affirmative defenses. This procedure may 
not be employed for the purpose of delay, harassment or obtaining 
information that is beyond the scope of permissible inquiry related to 
the material facts in dispute in the pending proceeding.
    (b) Requests for interrogatories filed and served pursuant to 
paragraph (a) of this section shall contain a listing of the 
interrogatories requested and an explanation of why the information 
sought in each interrogatory is both necessary to the resolution of the 
dispute and not available from any other source.
    (c) A responding party shall file with the Commission and serve on 
the propounding party any opposition and objections to the requests for 
interrogatories as follows:
    (1) By the defendant, within ten calendar days of service of the 
requests for interrogatories served simultaneously with the complaint 
and within five calendar days of the requests for interrogatories 
served following service of the answer;
    (2) By the complainant, within five calendar days of service of the 
requests for interrogatories; and
    (3) In no event less than three calendar days prior to the initial 
status conference as provided for in Sec.  8.35(a) of this subpart.
    (d) Commission staff will consider the requests for 
interrogatories, properly filed and served pursuant to paragraph (a) of 
this section, along with any objections or oppositions thereto, 
properly filed and served pursuant to paragraph (b) of this section, at 
the initial status conference, as provided for in Sec.  8.35(a)(5) of 
this subpart, and at that time determine the interrogatories, if any, 
to which parties shall respond, and set the schedule of such response.
    (e) The interrogatories ordered to be answered pursuant to 
paragraph (d) of this section are to be answered separately and fully 
in writing under oath or affirmation by the party served, or if such 
party is a public or private corporation or partnership or association, 
by any officer or agent who shall furnish such information as is 
available to the party. The answers shall be signed by the person 
making them. The answers shall be filed with the Commission and served 
on the propounding party.
    (f) A propounding party asserting that a responding party has 
provided an inadequate or insufficient response to a Commission-ordered 
discovery request may file a motion to compel within ten days of the 
service of such response, or as otherwise directed by Commission staff, 
pursuant to the requirements of Sec.  8.30 of this subpart.
    (g) The Commission may, in its discretion, require parties to 
provide documents to the Commission in a scanned or other electronic 
format that provides:
    (1) Indexing by useful identifying information about the documents; 
and
    (2) Technology that allows staff to annotate the index so as to 
make the format an efficient means of reviewing the documents.
    (h) The Commission may allow additional discovery, including, but 
not limited to, document production, depositions and/or additional 
interrogatories. In its discretion, the Commission may modify the 
scope, means and scheduling of discovery in light of the needs of a 
particular case and the requirements of applicable statutory deadlines.


Sec.  8.33  Confidentiality of information produced or exchanged by the 
parties.

    (a) Any materials generated in the course of a formal complaint 
proceeding may be designated as proprietary by that party if the party 
believes in good faith that the materials fall within an exemption to 
disclosure contained in the Freedom of Information Act (FOIA), 5 U.S.C. 
552(b)(1) through (9). Any party asserting confidentiality for such 
materials shall so indicate by clearly marking each page, or portion 
thereof, for which a proprietary designation is claimed. If a 
proprietary designation is challenged, the party claiming 
confidentiality shall have the burden of demonstrating, by a 
preponderance of the evidence, that the material designated as 
proprietary falls under the standards for nondisclosure enunciated in 
the FOIA.
    (b) Materials marked as proprietary may be disclosed solely to the 
following persons, only for use in prosecuting or defending a party to 
the complaint action, and only to the extent necessary to assist in the 
prosecution or defense of the case:
    (1) Counsel of record representing the parties in the complaint 
action and any support personnel employed by such attorneys;
    (2) Officers or employees of the opposing party who are named by 
the opposing party as being directly involved in the prosecution or 
defense of the case;
    (3) Consultants or expert witnesses retained by the parties;
    (4) The Commission and its staff; and
    (5) Court reporters and stenographers in accordance with the terms 
and conditions of this section.
    (c) These individuals shall not disclose information designated as 
proprietary to any person who is not authorized under this section to 
receive such information, and shall not use the information in any 
activity or function other than the prosecution or defense in the case 
before the Commission. Each

[[Page 13847]]

individual who is provided access to the information shall sign a 
notarized statement affirmatively stating that the individual has 
personally reviewed the Commission's rules and understands the 
limitations they impose on the signing party.
    (d) No copies of materials marked proprietary may be made except 
copies to be used by persons designated in paragraph (b) of this 
section. Each party shall maintain a log recording the number of copies 
made of all proprietary material and the persons to whom the copies 
have been provided.
    (e) Upon termination of a formal complaint proceeding, including 
all appeals and petitions, all originals and reproductions of any 
proprietary materials, along with the log recording persons who 
received copies of such materials, shall be provided to the producing 
party. In addition, upon final termination of the complaint proceeding, 
any notes or other work product derived in whole or in part from the 
proprietary materials of an opposing or third party shall be destroyed.


Sec.  8.34  Other required written submissions.

    (a) The Commission may, in its discretion, or upon a party's motion 
showing good cause, require the parties to file briefs summarizing the 
facts and issues presented in the pleadings and other record evidence.
    (b) Unless otherwise directed by the Commission, all briefs shall 
include all legal and factual claims and defenses previously set forth 
in the complaint, answer, or any other pleading submitted in the 
proceeding. Claims and defenses previously made but not reflected in 
the briefs will be deemed abandoned. The Commission may, in its 
discretion, limit the scope of any briefs to certain subjects or 
issues. A party shall attach to its brief copies of all documents, data 
compilations, tangible things, and affidavits upon which such party 
relies or intends to rely to support the facts alleged and legal 
arguments made in its brief and such brief shall contain a full 
explanation of how each attachment is relevant to the issues and 
matters in dispute. All such attachments to a brief shall be documents, 
data compilations or tangible things, or affidavits made by persons, 
that were identified by any party in its information designations filed 
pursuant to Sec. Sec.  8.24(a)(10)(i), (a)(10)(ii), 8.27(f)(1), (f)(2), 
and 8.29(d)(1), (d)(2) of this subpart. Any other supporting 
documentation or affidavits that is attached to a brief must be 
accompanied by a full explanation of the relevance of such materials 
and why such materials were not identified in the information 
designations. These briefs shall contain the proposed findings of fact 
and conclusions of law which the filing party is urging the Commission 
to adopt, with specific citation to the record, and supporting relevant 
authority and analysis.
    (c) In cases in which discovery is not conducted, absent an order 
by the Commission that briefs be filed, parties may not submit briefs. 
If the Commission does authorize the filing of briefs in cases in which 
discovery is not conducted, briefs shall be filed concurrently by both 
the complainant and defendant at such time as designated by the 
Commission staff and in accordance with the provisions of this section.
    (d) In cases in which discovery is conducted, briefs shall be filed 
concurrently by both the complainant and defendant at such time 
designated by the Commission staff.
    (e) Briefs containing information which is claimed by an opposing 
or third party to be proprietary under Sec.  8.33 of this subpart shall 
be submitted to the Commission in confidence pursuant to the 
requirements of Sec.  0.459 of this chapter and clearly marked ``Not 
for Public Inspection.'' An edited version removing all proprietary 
data shall also be filed with the Commission for inclusion in the 
public file. Edited versions shall be filed within five days from the 
date the unedited brief is submitted, and served on opposing parties.
    (f) Initial briefs shall be no longer than twenty-five pages. Reply 
briefs shall be no longer than ten pages. Either on its own motion or 
upon proper motion by a party, the Commission staff may establish other 
page limits for briefs.
    (g) The Commission may require the parties to submit any additional 
information it deems appropriate for a full, fair, and expeditious 
resolution of the proceeding, including affidavits and exhibits.
    (h) The parties shall submit a joint statement of stipulated facts, 
disputed facts, and key legal issues no later than two business days 
prior to the initial status conference, scheduled in accordance with 
the provisions of Sec.  8.35(a) of this subpart.


Sec.  8.35  Status conference.

    (a) In any complaint proceeding, the Commission may, in its 
discretion, direct the attorneys and/or the parties to appear before it 
for a status conference. Unless otherwise ordered by the Commission, an 
initial status conference shall take place, at the time and place 
designated by the Commission staff, ten business days after the date 
the answer is due to be filed. A status conference may include 
discussion of:
    (1) Simplification or narrowing of the issues;
    (2) The necessity for or desirability of additional pleadings or 
evidentiary submissions;
    (3) Obtaining admissions of fact or stipulations between the 
parties as to any or all of the matters in controversy;
    (4) Settlement of all or some of the matters in controversy by 
agreement of the parties;
    (5) Whether discovery is necessary and, if so, the scope, type and 
schedule for such discovery;
    (6) The schedule for the remainder of the case and the dates for 
any further status conferences; and
    (7) Such other matters that may aid in the disposition of the 
complaint.
    (b)(1) Parties shall meet and confer prior to the initial status 
conference to discuss:
    (i) Settlement prospects;
    (ii) Discovery;
    (iii) Issues in dispute;
    (iv) Schedules for pleadings;
    (v) Joint statement of stipulated facts, disputed facts, and key 
legal issues; and
    (2) Parties shall submit a joint statement of all proposals agreed 
to and disputes remaining as a result of such meeting to Commission 
staff at least two business days prior to the scheduled initial status 
conference.
    (c) In addition to the initial status conference referenced in 
paragraph (a) of this section, any party may also request that a 
conference be held at any time after the complaint has been filed.
    (d) During a status conference, the Commission staff may issue oral 
rulings pertaining to a variety of interlocutory matters relevant to 
the conduct of a formal complaint proceeding including, inter alia, 
procedural matters, discovery, and the submission of briefs or other 
evidentiary materials.
    (e) Parties may make, upon written notice to the Commission and all 
attending parties at least three business days prior to the status 
conference, an audio recording of the Commission staff's summary of its 
oral rulings. Alternatively, upon agreement among all attending parties 
and written notice to the Commission at least three business days prior 
to the status conference, the parties may make an audio recording of, 
or use a stenographer to transcribe, the oral presentations and 
exchanges between and among the participating parties, insofar as such 
communications are ``on-the-record'' as determined by the Commission 
staff, as well as the Commission staff's summary of its oral rulings. A 
complete transcript of any

[[Page 13848]]

audio recording or stenographic transcription shall be filed with the 
Commission as part of the record, pursuant to the provisions of 
paragraph (f)(2) of this section. The parties shall make all necessary 
arrangements for the use of a stenographer and the cost of 
transcription, absent agreement to the contrary, will be shared equally 
by all parties that agree to make the record of the status conference.
    (f) The parties in attendance, unless otherwise directed, shall 
either:
    (1) Submit a joint proposed order memorializing the oral rulings 
made during the conference to the Commission by 5:30 p.m., Eastern 
Time, on the business day following the date of the status conference, 
or as otherwise directed by Commission staff. In the event the parties 
in attendance cannot reach agreement as to the rulings that were made, 
the joint proposed order shall include the rulings on which the parties 
agree, and each party's alternative proposed rulings for those rulings 
on which they cannot agree. Commission staff will review and make 
revisions, if necessary, prior to signing and filing the submission as 
part of the record. The proposed order shall be submitted both as hard 
copy and on computer disk in accordance with the requirements of Sec.  
8.36(d) of this subpart; or
    (2) Pursuant to the requirements of paragraph (e) of this section, 
submit to the Commission by 5:30 p.m., Eastern Time, on the third 
business day following the status conference or as otherwise directed 
by Commission staff either:
    (i) A transcript of the audio recording of the Commission staff's 
summary of its oral rulings;
    (ii) A transcript of the audio recording of the oral presentations 
and exchanges between and among the participating parties, insofar as 
such communications are ``on-the-record'' as determined by the 
Commission staff, and the Commission staff's summary of its oral 
rulings; or
    (iii) A stenographic transcript of the oral presentations and 
exchanges between and among the participating parties, insofar as such 
communications are ``on-the-record'' as determined by the Commission 
staff, and the Commission staff's summary of its oral rulings.
    (g) Status conferences will be scheduled by the Commission staff at 
such time and place as it may designate to be conducted in person or by 
telephone conference call.
    (h) The failure of any attorney or party, following reasonable 
notice, to appear at a scheduled conference will be deemed a waiver by 
that party and will not preclude the Commission staff from conferring 
with those parties and/or counsel present.


Sec.  8.36  Specifications as to pleadings, briefs, and other 
documents; subscription.

    (a) All papers filed in any formal complaint proceeding must be 
drawn in conformity with the requirements of Sec. Sec.  1.49 and 1.50 
of this chapter.
    (b) All averments of claims or defenses in complaints and answers 
shall be made in numbered paragraphs. The contents of each paragraph 
shall be limited as far as practicable to a statement of a single set 
of circumstances. Each claim founded on a separate transaction or 
occurrence and each affirmative defense shall be separately stated to 
facilitate the clear presentation of the matters set forth.
    (c) The original of all pleadings and other submissions filed by 
any party shall be signed by the party, or by the party's attorney. The 
signing party shall include in the document his or her address, 
telephone number, facsimile number and the date on which the document 
was signed. Copies should be conformed to the original. Unless 
specifically required by rule or statute, pleadings need not be 
verified. The signature of an attorney or party shall be a certificate 
that the attorney or party has read the pleading, motion, or other 
paper; that to the best of his or her knowledge, information, and 
belief formed after reasonable inquiry, it is well grounded in fact and 
is warranted by existing law or a good faith argument for the 
extension, modification, or reversal of existing law; and that it is 
not interposed solely for purposes of delay or for any other improper 
purpose.
    (d) All proposed orders shall be submitted both as hard copies and 
on computer disk formatted to be compatible with the Commission's 
computer system and using the Commission's current word processing 
software. Each disk should be submitted in ``read only'' mode. Each 
disk should be clearly labeled with the party's name, proceeding, type 
of pleading, and date of submission. Each disk should be accompanied by 
a cover letter. Parties who have submitted copies of tariffs or reports 
with their hard copies need not include such tariffs or reports on the 
disk. Upon showing of good cause, the Commission may waive the 
requirements of this paragraph.


Sec.  8.37  Copies; service; separate filings against multiple 
defendants.

    (a) Complaints may generally be brought against only one named 
defendant; such actions may not be brought against multiple defendants 
unless the defendants are commonly owned or controlled, are alleged to 
have acted in concert, are alleged to be jointly liable to complainant, 
or the complaint concerns common questions of law or fact. Complaints 
may, however, be consolidated by the Commission for disposition.
    (b) The complainant shall file an original copy of the complaint 
and, on the same day:
    (1) File three copies of the complaint with the Office of the 
Commission Secretary;
    (2) Serve two copies on the Enforcement Bureau; and
    (3) If a complaint is addressed against multiple defendants, file 
three copies of the complaint with the Office of the Commission 
Secretary for each additional defendant.
    (c) Generally, a separate file is set up for each defendant. An 
original plus two copies shall be filed of all pleadings and documents, 
other than the complaint, for each file number assigned.
    (d) The complainant shall serve the complaint by hand delivery on 
either the named defendant or one of the named defendant's registered 
agents for service of process on the same date that the complaint is 
filed with the Commission in accordance with the requirements of 
paragraph (b) of this section.
    (e) Upon receipt of the complaint by the Commission, the Commission 
shall promptly send, by facsimile transmission to each defendant named 
in the complaint, notice of the filing of the complaint. The Commission 
shall send, by regular U.S. mail delivery, to each defendant named in 
the complaint, a copy of the complaint. The Commission shall 
additionally send, by regular U.S. mail to all parties, a schedule 
detailing the date the answer will be due and the date, time and 
location of the initial status conference.
    (f) All subsequent pleadings and briefs filed in any formal 
complaint proceeding, as well as all letters, documents or other 
written submissions, shall be served by the filing party on the 
attorney of record for each party to the proceeding, or, where a party 
is not represented by an attorney, each party to the proceeding either 
by hand delivery, overnight delivery, or by facsimile transmission 
followed by regular U.S. mail delivery, together with a proof of such 
service in accordance with the requirements of Sec.  1.47(g) of this 
chapter. Service is deemed effective as follows:
    (1) Service by hand delivery that is delivered to the office of the 
recipient by 5:30 p.m., local time of the recipient, on a business day 
will be deemed

[[Page 13849]]

served that day. Service by hand delivery that is delivered to the 
office of the recipient after 5:30 p.m., local time of the recipient, 
on a business day will be deemed served on the following business day;
    (2) Service by overnight delivery will be deemed served the 
business day following the day it is accepted for overnight delivery by 
a reputable overnight delivery service such as, or comparable to, the 
US Postal Service Express Mail, United Parcel Service or Federal 
Express; or
    (3) Service by facsimile transmission that is fully transmitted to 
the office of the recipient by 5:30 p.m., local time of the recipient, 
on a business day will be deemed served that day. Service by facsimile 
transmission that is fully transmitted to the office of the recipient 
after 5:30 p.m., local time of the recipient, on a business day will be 
deemed served on the following business day.
    (g) Supplemental complaint proceedings. Supplemental complaints 
filed pursuant to Sec.  8.25 of this subpart shall conform to the 
requirements set out in this section, except that the complainant need 
not submit a filing fee, and the complainant may effect service 
pursuant to paragraph (f) of this section rather than paragraph (d) of 
this section numerals.

[FR Doc. 2011-5348 Filed 3-11-11; 8:45 am]
BILLING CODE 6712-01-P