[Federal Register Volume 76, Number 102 (Thursday, May 26, 2011)]
[Proposed Rules]
[Pages 30605-30637]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-12685]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket No. 11-76; FCC 11-68]


Assessment and Collection of Regulatory Fees For Fiscal Year 2011

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission will revise its Schedule of Regulatory Fees in 
order to recover an amount of $335,794,000 that Congress has required 
the Commission to collect for fiscal year 2011. The Communications Act 
of 1934, as amended, provides for the annual assessment and collection 
of regulatory fees for annual ``Mandatory Adjustments'' and ``Permitted 
Amendments'' to the Schedule of Regulatory Fees.

DATES: Submit comments on or before June 2, 2011, and reply comments on 
or before June 9, 2011.

ADDRESSES: You may submit comments, identified by MD Docket No. 11-76, 
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.
     E-mail: [email protected]. Include MD Docket No. 11-76 in the 
subject line of the message.
     Mail: 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 should be addressed to 445 12th 
Street, SW., Washington DC 20554.
    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: Roland Helvajian, Office of Managing 
Director at (202) 418-0444.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking (NPRM), FCC 11-68, MD Docket No. 11-76, adopted 
and released May 3, 2011. The full text of this document is available 
for inspection and copying during normal business hours in the FCC 
Reference Center, 445 Twelfth Street, SW., Room CY-A257, Portals II, 
Washington, DC 20554, and may also be purchased from the Commission's 
copy contractor, BCPI, Inc., Portals II, 445 Twelfth Street, SW., Room 
CY-B402, Washington, DC 20554. Customers may contact BCPI, Inc. via 
their Web site, http://www.bcpi.com, or call 1-800-378-3160. This 
document is available in alternative formats (computer diskette, large 
print, audio record, and braille). Persons with disabilities who need 
documents in these formats may contact the FCC by e-mail: 
[email protected] or phone: 202-418-0530 or TTY: 202-418-0432.

I. Procedural Matters

A. Ex Parte Rules-Permit-But Disclose Proceeding

    1. This is a ``permit-but-disclose'' proceeding subject to the 
requirements under section 1.1206(b) of the Commission's rules.\1\ Ex 
parte presentations are permissible if disclosed in accordance with 
Commission rules, except during the Sunshine Agenda period when 
presentations, ex parte or otherwise, are generally prohibited. Persons 
making oral ex parte presentations are reminded that a memorandum 
summarizing a

[[Page 30606]]

presentation must contain a summary of the substance of the 
presentation and not merely a listing of the subjects discussed. More 
than a one- or two-sentence description of the views and arguments 
presented is generally required.\2\ Additional rules pertaining to oral 
and written presentations are set forth in Section 1.1206(b).
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    \1\ See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 1.1203.
    \2\ See 47 CFR 1.1206(b)(2).
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B. Comment Filing Procedures

    2. Pursuant to sections 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://fjallfoss.fcc.gov/ecfs2/ or the Federal eRulemaking Portal: http://www.regulations.gov.
     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. All filings must be addressed to the Commission's Secretary, 
Office of the Secretary, Federal Communications Commission.
     All hand-delivered or messenger-delivered paper filings 
for the Commission's Secretary must be delivered to FCC Headquarters at 
445 12th St., SW., Room TW-A325, Washington, DC 20554. The filing hours 
are 8 a.m. to 7 p.m. 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).
    3. Documents in MD Docket No. 11-76 will be available for public 
inspection and copying during regular business hours at the FCC 
Reference Information Center, Portals II, 445 12th Street, SW., CY-
A257, Washington, DC 20554. These documents will also be available free 
online, via ECFS. Documents will be available electronically in ASCII, 
Word, and/or Adobe Acrobat.
    4. To request information in accessible formats (computer 
diskettes, large print, audio recording, and Braille), send an e-mail 
to [email protected] or call the Commission's Consumer and Governmental 
Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY). This 
document can also be downloaded in Word and Portable Document Format 
(``PDF'') at: http://www.fcc.gov.

C. Paperwork Reduction Act

    5. This NPRM does not contain proposed or modified information 
collection burden (s) subject to the Paperwork Reduction Act of 1995 
(PRA), Public Law 104-13. In addition, therefore, it does not contain 
any new or modified information collection burden for small business 
concerns with fewer than 25 employees, pursuant to the Small Business 
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 
3506(c)(4).

D. Congressional Review Act Analysis

    6. The Commission will send a copy of this NPRM to Congress and the 
Government Accountability Office pursuant to the Congressional Review 
Act.\3\
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    \3\ See 5 U.S.C. 801(a)(1)(A). The Congressional Review Act is 
contained in Title II, 251, of the CWAAA; see Public Law 104-121, 
Title II, 251, 110 Stat. 868.
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E. Initial Regulatory Flexibility Analysis

    7. An initial regulatory flexibility analysis (``IRFA'') is 
contained herein. Comments to the IRFA must be identified as responses 
to the IRFA and filed by the deadlines for comments on the Notice. The 
Commission will send a copy of the Notice, including the IRFA, to the 
Chief Counsel for Advocacy of the Small Business Administration.

II. Notice of Proposed Rulemaking

Introduction

    8. In this NPRM, we propose to collect $335,794,000 in regulatory 
fees for Fiscal Year (``FY'') 2011, pursuant to Section 9 of the 
Communications Act of 1934, as amended (the ``Act''). Section 9 
regulatory fees are mandated by Congress and are collected to recover 
the regulatory costs associated with the Commission's enforcement, 
policy and rulemaking, user information, and international 
activities.\4\ The annual regulatory fee amount to be collected is 
established each year in the Commission's Annual Appropriations Act 
which is adopted by Congress and signed by the President and which 
funds the Commission.\5\ In this annual regulatory fee proceeding, we 
retain many of the established methods, policies, and procedures for 
collecting Section 9 regulatory fees adopted by the Commission in prior 
years. Consistent with our established practice, we intend to collect 
these regulatory fees during a September 2011 filing window in order to 
collect the required amount by the end of our fiscal year.
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    \4\ 47 U.S.C. 159(a).
    \5\ See Consolidated Appropriations Act, 2010, Public Law 111-
117 for the FY 2010 appropriations act language for the Commission 
establishing the amount of $335,794,000 of offsetting collections to 
be assessed and collected by the Commission pursuant to Section 9 of 
the Communications Act.
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III. Discussion

A. FY 2011 Regulatory Fee Assessment Methodology

    9. In our FY 2011 regulatory fee assessment, we will use the same 
Section 9 regulatory fee assessment methodology adopted in FY 2010 and 
in prior years. Each fiscal year, the Commission proportionally 
allocates the total amount that must be collected via Section 9 
regulatory fees. The results of our FY 2011 regulatory fee assessment 
methodology (including a comparison to the prior year's results) are 
contained in the table below. To collect the $335,794,000 required by 
Congress, we adjusted the FY 2010 amount upward by 4.7 percent and 
allocated this amount across the various fee categories. Consistent 
with past practice, we then divided the FY 2011 amount by the number of 
estimated payment units in each fee category to determine the unit 
fee.\6\ As in prior

[[Page 30607]]

years, for cases involving small fees, e.g., licenses that are renewed 
over a multiyear term, we divided the resulting unit fee by the term of 
the license and then rounded these unit fees consistent with the 
requirements of Section 9(b)(2) of the Act.
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    \6\ In many instances, the regulatory fee amount is a flat fee 
per licensee or regulatee. In some instances, the fee amount 
represents a per-unit fee (such as for International Bearer 
Circuits), a per-unit subscriber fee (such as for Cable, Commercial 
Mobile Radio Service (``CMRS'') Cellular/Mobile and CMRS Messaging), 
or a fee factor per revenue dollar (Interstate Telecommunications 
Service Provider (``ITSP'') fee). The payment unit is the measure 
upon which the fee is based, such as a licensee, regulatee, or 
subscriber fee.
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BILLING CODE 6712-01-P

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BILLING CODE 6712-01-C

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    10. In calculating the FY 2011 regulatory fees listed in (see 
Table--FY 2011 Schedule of Regulatory Fees below), we adjusted the FY 
2011 list of payment units (see Table--Sources of Payment Unit 
Estimates for FY 2011 below) based upon licensee databases, industry 
and trade group projections, as well as prior year payment information. 
In some instances, Commission licensee databases are used; in other 
instances, actual prior year payment records and/or industry and trade 
association projections are used in determining the payment units.\7\ 
Where appropriate, we adjusted and rounded our final estimates to take 
into consideration events that may impact the number of units for which 
regulatees submit payment, such as waivers and exemptions that may be 
filed in FY 2011, and fluctuations in the number of licenses or station 
operators due to economic, technical, or other reasons. Our estimated 
FY 2011 payment units, therefore, are based on several variable factors 
that are relevant to each fee category. The fee rate may also be 
rounded or adjusted slightly to account for these variables.
BILLING CODE 6712-01-P
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    \7\ The databases we consulted are the following: the 
Commission's Universal Licensing System (``ULS''), International 
Bureau Filing System (``IBFS''), Consolidated Database System 
(``CDBS'') and Cable Operations and Licensing System (``COALS''). We 
also consulted reports generated within the Commission such as the 
Wireline Competition Bureau's Trends in Telephone Service and the 
Wireless Telecommunications Bureau's Numbering Resource Utilization 
Forecast and Annual CMRS Competition Report, as well as industry 
sources including, but not limited to, Television & Cable Factbook 
by Warren Publishing, Inc. and the Broadcasting and Cable Yearbook 
by Reed Elsevier, Inc.

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[GRAPHIC] [TIFF OMITTED] TP26MY11.011

BILLING CODE 6712-01-C
TABLE--FY 2011 Schedule of Regulatory Fees (Continued)

                                      FY 2011 Radio Station Regulatory Fees
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                                                                                                     FM Classes
      Population served        AM Class A    AM Class B    AM Class C    AM Class D    FM Classes   B, C, C0, C1
                                                                                       A, B1 & C3       & C2
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<=25,000....................          $700          $575          $525          $600          $675          $850
25,001-75,000...............         1,400         1,150           800           900         1,350         1,500
75,001-150,000..............         2,100         1,450         1,050         1,500         1,850         2,750
150,001-500,000.............         3,150         2,450         1,575         1,800         2,875         3,600
500,001-1,200,000...........         4,550         3,750         2,625         3,000         4,550         5,300
1,200,001-3,000,00..........         7,000         5,750         3,950         4,800         7,425         8,500
>3,000,000..................         8,400         6,900         5,000         6,000         9,450        11,050
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[[Page 30614]]

FY 2011 Schedule of Regulatory Fees (Continued)

                                                     International Bearer Circuits--Submarine Cable
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 Submarine cable systems (capacity as of
            December 31, 2010)              Fee amount                                               Address
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<2.5 Gbps................................      $12,825  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
2.5 Gbps or greater, but less than 5 Gbps       25,650  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
5 Gbps or greater, but less than 10 Gbps.       51,275  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
10 Gbps or greater, but less than 20 Gbps      102,575  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
20 Gbps or greater.......................      205,125  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
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Table--Sources of Payment Unit Estimates for FY 2011

    In order to calculate individual service fees for FY 2011, we 
adjusted FY 2010 payment units for each service to more accurately 
reflect expected FY 2011 payment liabilities. We obtained our updated 
estimates through a variety of means. For example, we used Commission 
licensee data bases, actual prior year payment records and industry and 
trade association projections when available. The databases we 
consulted include our Universal Licensing System (``ULS''), 
International Bureau Filing System (``IBFS''), Consolidated Database 
System (``CDBS'') and Cable Operations and Licensing System 
(``COALS''), as well as reports generated within the Commission such as 
the Wireline Competition Bureau's Trends in Telephone Service and the 
Wireless Telecommunications Bureau's Numbering Resource Utilization 
Forecast.
    We sought verification for these estimates from multiple sources 
and, in all cases; we compared FY 2011 estimates with actual FY 2010 
payment units to ensure that our revised estimates were reasonable. 
Where appropriate, we adjusted and/or rounded our final estimates to 
take into consideration the fact that certain variables that impact on 
the number of payment units cannot yet be estimated with sufficient 
accuracy. These include an unknown number of waivers and/or exemptions 
that may occur in FY 2011 and the fact that, in many services, the 
number of actual licensees or station operators fluctuates from time to 
time due to economic, technical, or other reasons. When we note, for 
example, that our estimated FY 2011 payment units are based on FY 2010 
actual payment units, it does not necessarily mean that our FY 2011 
projection is exactly the same number as in FY 2010. We have either 
rounded the FY 2011 number or adjusted it slightly to account for these 
variables.

    Table--Sources of Payment Unit Estimates for FY 2011 (Continued)
------------------------------------------------------------------------
           Fee Category               Sources of payment unit estimates
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Land Mobile (All), Microwave, 218-  Based on Wireless Telecommunications
 219 MHz, Marine (Ship & Coast),     Bureau (``WTB'') projections of new
 Aviation (Aircraft & Ground),       applications and renewals taking
 GMRS, Amateur Vanity Call Signs,    into consideration existing
 Domestic Public Fixed.              Commission licensee data bases.
                                     Aviation (Aircraft) and Marine
                                     (Ship) estimates have been adjusted
                                     to take into consideration the
                                     licensing of portions of these
                                     services on a voluntary basis.
CMRS Cellular/Mobile Services.....  Based on WTB projection reports, and
                                     FY 10 payment data.
CMRS Messaging Services...........  Based on WTB reports, and FY 10
                                     payment data.
AM/FM Radio Stations..............  Based on CDBS data, adjusted for
                                     exemptions, and actual FY 2010
                                     payment units.
UHF/VHF Television Stations.......  Based on CDBS data, adjusted for
                                     exemptions, and actual FY 2010
                                     payment units.
AM/FM/TV Construction Permits.....  Based on CDBS data, adjusted for
                                     exemptions, and actual FY 2010
                                     payment units.
LPTV, Translators and Boosters,     Based on CDBS data, adjusted for
 Class A Television.                 exemptions, and actual FY 2010
                                     payment units.
Broadcast Auxiliaries.............  Based on actual FY 2010 payment
                                     units.
BRS (formerly MDS/MMDS)...........  Based on WTB reports and actual FY
LMDS..............................   2010 payment units.
                                    Based on WTB reports and actual FY
                                     2010 payment units.
Cable Television Relay Service      Based on data from Media Bureau's
 (``CARS'') Stations.                COALS database and actual FY 2010
                                     payment units.
Cable Television System             Based on publicly available data
 Subscribers.                        sources for estimated subscriber
                                     counts and actual FY 2010 payment
                                     units.
Interstate Telecommunication        Based on FCC Form 499-Q data for the
 Service Providers.                  four quarters of calendar year
                                     2010, the Wireline Competition
                                     Bureau projected the amount of
                                     calendar year 2009 revenue that
                                     will be reported on 2011 FCC Form
                                     499-A worksheets in April, 2011.
Earth Stations....................  Based on International Bureau
                                     (``IB'') licensing data and actual
                                     FY 2010 payment units.
Space Stations (GSOs & NGSOs).....  Based on IB data reports and actual
                                     FY 2010 payment units.
International Bearer Circuits.....  Based on IB reports and submissions
                                     by licensees.
Submarine Cable Licenses..........  Based on IB license information.
------------------------------------------------------------------------

    11. When calculating the fee methodology for AM and FM radio 
stations, we consider many factors, such as facility attributes and the 
population served by each station. The calculation of the population 
served is determined by coupling current United States Census Bureau 
data with technical and engineering data, as detailed in the table 
below. In FY 2011, we will begin to incorporate new Census data that 
was taken in 2010, and this could have an impact in altering the fees 
of some radio stations. Hence, the population served, as well as the 
class and type of service (AM or FM), will continue to be the

[[Page 30615]]

principal variables in determining the amount of regulatory fees to be 
paid.\8\
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    \8\ In addition, beginning in FY 2005, we established a 
procedure by which we set regulatory fees for AM and FM radio and 
VHF and UHF television Construction Permits each year at an amount 
no higher than the lowest regulatory fee for a licensed station in 
that respective service category. For example, in FY 2010 the 
regulatory fee for an AM radio station Construction Permit was no 
higher than the regulatory fee for an AM Class C radio station 
serving a population of less than 25,000.
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Table--Factors, Measurements, and Calculations That Go Into Determining 
Station Signal Contours and Associated Population Coverages

AM Stations

    For stations with nondirectional daytime antennas, the theoretical 
radiation was used at all azimuths. For stations with directional 
daytime antennas, specific information on each day tower, including 
field ratio, phasing, spacing and orientation was retrieved, as well as 
the theoretical pattern root-mean-square of the radiation in all 
directions in the horizontal plane (``RMS'') figure milliVolt per meter 
(mV/m) @ 1 km) for the antenna system. The standard, or modified 
standard if pertinent, horizontal plane radiation pattern was 
calculated using techniques and methods specified in Sections 73.150 
and 73.152 of the Commission's rules (see 47 CFR 73.150 and 73.152). 
Radiation values were calculated for each of 360 radials around the 
transmitter site. Next, estimated soil conductivity data was retrieved 
from a database representing the information in FCC Figure R3 (see Map 
of Estimated Effective Ground Conductivity in the United States, 47 CFR 
73.190 Figure R3). Using the calculated horizontal radiation values, 
and the retrieved soil conductivity data, the distance to the principal 
community (5 mV/m) contour was predicted for each of the 360 radials. 
The resulting distance to principal community contours were used to 
form a geographical polygon. Population counting was accomplished by 
determining which 2000 block centroids were contained in the polygon. 
(A block centroid is the center point of a small area containing 
population as computed by the U.S. Census Bureau.) The sum of the 
population figures for all enclosed blocks represents the total 
population for the predicted principal community coverage area.

FM Stations

    The greater of the horizontal or vertical effective radiated power 
(``ERP'') (kW) and respective height above average terrain (``HAAT'') 
(m) combination was used. Where the antenna height above mean sea level 
(``HAMSL'') was available, it was used in lieu of the average HAAT 
figure to calculate specific HAAT figures for each of 360 radials under 
study. Any available directional pattern information was applied as 
well, to produce a radial-specific ERP figure. The HAAT and ERP figures 
were used in conjunction with the Field Strength (50-50) propagation 
curves specified in 47 CFR 73.313 of the Commission's rules to predict 
the distance to the principal community (70 dBu (decibel above 1 
microVolt per meter) or 3.17 mV/m) contour for each of the 360 radials 
(47 CFR 73.313). The resulting distance to principal community contours 
were used to form a geographical polygon. Population counting was 
accomplished by determining which 2000 block centroids were contained 
in the polygon. The sum of the population figures for all enclosed 
blocks represents the total population for the predicted principal 
community coverage area.

B. Regulatory Fee Obligations for Digital Low Power, Class A, and TV 
Translators/Boosters

    12. The digital transition to full-service television stations was 
completed on June 12, 2009, but the digital transition for Low Power, 
Class A, and TV Translators/Boosters remains voluntary, and there is 
presently no set date for the completion of this transition. 
Historically, the discussion of digital transition conversion with 
respect to regulatory fees has applied only to full-service television 
stations. As a result, the ``digital only'' exemption does not impact 
this class of regulatees. Because the digital transition in the Low 
Power, Class A, and TV Translators/Booster facilities is still 
voluntary and the transition will occur over a period time, some 
facilities may still be in the process of converting from an analog to 
a digital service. During this transition period, licensees of Low 
Power, Class A, and TV Translator/Booster facilities may be operating 
in analog mode, in digital mode, or in an analog and digital simulcast 
mode. For regulatory fee purposes, a fee will be assessed for each 
facility operating either in an analog or digital mode. In instances in 
which a licensee is operating in both an analog and digital mode as a 
simulcast, a single regulatory fee will be assessed for this analog 
facility that has a digital companion channel. As greater numbers of 
facilities convert to digital mode, the Commission will provide revised 
instructions on how regulatory fees will be assessed.

C. Commercial Mobile Radio Service Messaging Service

    13. Commercial Mobile Radio Service (``CMRS'') Messaging Service, 
which replaced the CMRS One-Way Paging fee category in 1997, includes 
all narrowband services.\9\ Since 1997, the number of subscribers has 
declined from 40.8 million to 4.9 million, and there does not appear to 
be any sign of recovery to the subscriber levels of 1997-1999.\10\ 
Maintaining the fee at the existing level of $.08 per subscriber is the 
minimum reasonable and appropriate action to take under the prevailing 
circumstances in the paging industry. We propose in FY 2011 to continue 
maintaining the regulatory fee rate at $0.08 per subscriber due to the 
declining subscriber base in this industry. We seek comment on this 
proposal.
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    \9\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 1997, MD Docket No. 96-186, Report and Order, 12 FCC Rcd 17161, 
17184-85, para. 60 (1997) (``FY 1997 Report and Order'').
    \10\ Between FY 1997 and FY 2010, the subscriber base in the 
paging industry declined 89 percent from 40.8 million to 4.9 million 
subscribers, according to FY 2010 collections data as of September 
30, 2010.
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D. Interstate Telecommunications Service Provider (ITSP)

    14. In our FY 2010 Regulatory Fee Report and Order,\11\ we 
acknowledged that the revenue base upon which the ITSP fee is 
calculated has been decreasing for several years.\12\ Because of this 
continued decline, we limited the increase in the FY 2010 ITSP fee rate 
from $.00342 to $.00349, and assessed a slightly higher fee across all 
other fee categories. In FY 2011, the ITSP revenue base has experienced 
an even more significant decline. Over the past six months, we note an 
additional decline of nine percent (9%) in the ITSP base revenue, which 
would increase the ITSP

[[Page 30616]]

fee rate for FY 2011 to $.00402,\13\ an increase of 15% from the fee 
rate adopted in FY 2010.\14\ This increase in the FY 2011 ITSP fee rate 
from $.00349 to $.00402 will be detrimental to the operations of many 
small and medium ITSP providers, and will further burden a regulatory 
fee category already bearing the majority of the agency's overall 
regulatory fee burden. Therefore, as we did in FY 2010, we propose to 
limit the increase of the FY 2011 ITSP fee rate to $.00361 per revenue 
dollar, and assess a slightly higher fee across all other regulatory 
fee categories. We seek comment on this proposal.
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    \11\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2010, MD Docket No. 10-87, Report and Order, 25 FCC Rcd 9278 at 
para. 31 (2010) (``FY 2010 Report and Order'').
    \12\ In FY 2010 ITSP, the fee factor in the FY 2010 NPRM of 
$.00351 was based on December 2009 ITSP revenue data. April 2010 
ITSP revenue data, however, reflected revenues 3.4 percent lower 
than projections. This revenue decrease would have resulted in an 
increase in the resulting fee factor from the projected $.00351 to a 
fee factor of $.00364. Thus, based on the proposed methodology of 
the FY 2010 NPRM and the revised revenue numbers, the ITSP fee 
factor would have increased from $.00342 (FY 2009 ITSP fee rate) to 
$.00364. The concerns of these providers, which collectively 
represent 46.82 percent of all regulatory fees paid in any given 
year, resulted in the adoption, as an interim measure, an ITSP fee 
rate at $.00349, which is a 2.1% increase from FY 2009. We find this 
to be a reasonable interim measure pending our review of whether 
part of that 46.82 percent of the regulatory fee burden might be 
moved from ITSP in the context of fundamental reform.
    \13\ If the Commission did not provide any relief or consider 
changes in the ITSP revenue stream, the fee factor rate would be 
$0.00402 per revenue dollar.
    \14\ See FY 2010 Report and Order at Appendix C, Page 28.
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    15. Each year, the Commission downloads 499-A revenue data \15\ 
onto a FCC Form 159-W to establish an ITSP regulatory fee bill. These 
bills are then loaded into the Commission's electronic payment and 
filing system (``Fee Filer'') so that providers can view and pay their 
annual regulatory fee bill. Historically, in creating ITSP regulatory 
fee bills, the Commission separated 499-A filers into two categories: 
(1) Those whose primary revenue stream categorized them as interstate 
telecommunications service providers (ITSP), and (2) those whose 
primary revenue stream was considered to be non-ITSP, such as wireless, 
satellite, and other service providers. Simply stated, the logic here 
was to categorize 499-A filers into two regulatory fee paying 
categories--those that pay ITSP regulatory fees on the basis of a fee 
factor per revenue dollar, and those whose primary revenue stream would 
place them in a category other than ITSP (``non-ITSP providers''), such 
as wireless or satellite carriers, that pay regulatory fees on some 
other basis (e.g. wireless carriers pay regulatory fees on a per 
subscriber basis). By separating 499-A filers into these two categories 
(ITSP providers and non-ITSP providers), the Commission was not 
assessing the ITSP revenues of certain particular entities (non-ITSP 
providers) simply because these entities were paying another form of 
regulatory fee (e.g. wireless or satellite fees). After more careful 
consideration, we realize that this treatment resulted in predominantly 
ITSP providers paying fees on both ITSP revenues and, if they also 
provided other services, a per unit subscriber fee on other services 
(e.g. wireless services), while non-ITSP paid on a per unit basis only 
(e.g. for wireless services), and were not assessed fees on their ITSP 
revenues. There is no basis for this disparate treatment; it is only 
logical that these wireless providers and other non-ITSP providers be 
subject to ITSP fees based on their ITSP revenues, similar to the fees 
that are currently paid by wireline carriers. Therefore, instead of 
separating 499-A filers into these two categories of regulatory fee 
payers, we propose to assess ITSP regulatory fees on all ITSP revenues, 
regardless of the predominant classification of the payor. More 
specifically, we find that a more equitable way of assessing ITSP 
regulatory fees is to assess an ITSP fee on 499-A reported ITSP revenue 
items regardless of whether the payor is predominantly an ITSP or a 
non-ITSP provider. If FCC Form 499-A has revenues identified on lines 
412(e), 420(d), and/or 420(e), the provider would be subject to ITSP 
regulatory fees.\16\
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    \15\ FCC Form 499-A is filed annually with USAC on April 1st, 
but it can be revised many times for up to a year of the April 1st 
filing.
    \16\ See FCC Form 159-W on page 7 of the Commission's Interstate 
Telecommunications Service Provider (ITSP) Fact Sheet, August 2010. 
499-A Form Line 412(e) corresponds with Line 1 of FCC Form 159-W; 
499-A Form Line 420(d) corresponds with Line 2 of FCC Form 159-W; 
and 499-A Form Line 420(e) corresponds with Line 3 of FCC Form 159-
W. However, from FCC Form 159-W revenue Lines 1 through 3, a 
provider can also subtract Lines 5 through 12, resulting in a net 
revenue amount upon which regulatory fees would be due.
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    16. FCC Form 159-W was established in FY 2001 to assist providers 
in transposing revenue information from their FCC Form 499-A to a 
worksheet that would assist them in computing their regulatory fee 
obligation. Initially, the Form 159-W worksheet was left blank for the 
provider to complete and mail it in along with their check. In later 
years, the Commission provided a pre-completed Form 159-W based on 
revenue information directly from FCC Form 499-A. In this Notice of 
Proposed Rulemaking, the Commission proposes to assess a regulatory fee 
on all providers that have subject revenues on Line 14 of Form 159-W, 
which after the fee factor is applied, results in a regulatory fee 
obligation of $10 or greater. By assessing regulatory fees on all 
providers ($10 or greater), we believe we can achieve a more equitable 
assessment of ITSP regulatory fees across all providers, and reduce the 
subjective factor involved in identifying some providers as non-ITSP 
because their primary business is cellular or a satellite provider. If 
ITSP revenues are derived from the service and identified on the 
appropriate lines of Form 499-A (and subsequently transposed to Form 
159-W), then a regulatory fee would be assessed on those revenues. In 
FY 2011, we believe our proposal will add $2.0 billion to the unit base 
estimate, which will help to support maintaining the FY 2011 ITSP fee 
factor rate at $0.00361, reducing the impact of this limitation on all 
other regulatory fee categories. We seek comment on this proposal of 
assessing regulatory fees on ITSP revenues from all providers.

E. Fee Waiver Policies

    17. As our rules expressly provide, petitions for waiver of a 
regulatory fee must be accompanied by the required fee ``unless 
accompanied by a petition to defer payment due to financial hardship, 
supported by documentation of the financial hardship.'' \17\ Similarly, 
petitions for reduction of fees filed with less than the full fee due 
must be accompanied by a request for deferral ``supported by 
documentation of financial hardship.'' \18\ However, citing section 
1.1166(b) of the rules, which states that ``Deferrals of fees will be 
granted for a period of six months following the date that the fee is 
initially due,'' some have argued that, even where supporting 
documentation of financial hardship is not provided, a regulatee can 
delay its payment of the fees owed for up to six months simply by 
requesting the deferral. That argument is inconsistent with sections 
1.1166(c) and (d) of our rules, which provide that petitions for 
waivers or reductions will be dismissed if they are not accompanied by 
the full fee owed, unless the regulatee requests a deferral of payment 
supported by documentation of financial hardship.\19\ A regulatee's 
mere allegation of financial hardship thus does not automatically 
entitle it to a deferral of its obligation to pay regulatory fees; only 
a properly supported claim of financial hardship will entitle the 
regulatee to a deferral. Accordingly, if a request for deferral is not 
supported by documentation of financial hardship, it will be denied, 
and an associated petition for waiver or reduction will be dismissed. A 
regulatee cannot delay payment on the theory that its deferral request 
triggered an automatic six-month extension of its obligation to pay. We 
thus propose to amend section 1.1166(b) of the Rules \20\ to read, 
``Deferrals of fees, if granted, will be for

[[Page 30617]]

a designated period of time not to exceed six months.'' We seek comment 
on this rule clarification.
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    \17\ 47 CFR 1.1166(c).
    \18\ 47 CFR 1.1166(d).
    \19\ 47 CFR 1.1166(c) and (d) (requests for waivers and 
reductions of fees ``that do not include the required fees or forms 
will be dismissed unless accompanied by a petition to defer payment 
due to financial hardship, supported by documentation of the 
financial hardship.''
    \20\ 47 CFR 1.1166(b).
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F. Administrative and Operational Issues

    18. In FY 2009, the Commission implemented several changes in 
procedures which simplified the payment and reconciliation processes of 
FY 2009 regulatory fees. These changes proved to be very helpful to 
both licensees and to the Commission, and we propose in the following 
paragraphs to expand upon these improvements. In FY 2011, the 
Commission will promote greater use of technology (and less use of 
paper) to improve the regulatory fee notification and collection 
process. In addition to seeking comment on the specific initiatives 
discussed in the paragraphs below, we ask whether there are other steps 
we could take to promote greater use of technology in collecting 
regulatory fees.
1. Mandatory Use of Fee Filer
    19. In FY 2009, we instituted a mandatory filing requirement using 
the Commission's electronic filing and payment system (also known as 
``Fee Filer'').\21\ Licensees filing their annual regulatory fee 
payments were required to begin the process by entering the 
Commission's Fee Filer system with a valid FRN and password.\22\ This 
change was beneficial to both licensees and to the Commission. For 
licensees, the mandatory use of Fee Filer eliminates the need to 
manually complete and submit a hardcopy Form 159, and for the 
Commission, the data in electronic format made it much easier to 
process payments more efficiently and effectively. We propose to 
continue to make the use of Fee Filer for filing annual regulatory fees 
mandatory. We seek comment on this proposal. We also request comment on 
ways we might improve the mandatory use of Fee Filer. The mandatory use 
of Fee Filer does not mean that licensees are expected to pay only 
through Fee Filer--it is only mandatory for licensees to begin the 
process of filing their annual regulatory fees using Fee Filer.
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    \21\ FY 2009 Report and Order at paras. 20 and 21.
    \22\ Therefore, it is very important for licensees to have a 
current and valid FRN address on file in the Commission's 
Registration System (CORES).
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2. Notification and Collection of Regulatory Fees
a. Pre-Bills
    20. In prior years, the Commission mailed pre-bills via surface 
mail to licensees in select regulatory fee categories: Interstate 
telecommunications service providers (``ITSPs''), Geostationary 
(``GSO'') and Non-Geostationary (``NGSO'') satellite space station 
licensees,\23\ holders of Cable Television Relay Service (``CARS'') 
licenses, and Earth Station licensees.\24\ The remaining regulatees did 
not receive pre-bills. In our FY 2009 Report and Order, the Commission 
decided to have the attributes of these pre-bills viewed in Fee Filer, 
rather than mailing pre-bills out to licensees via surface mail.\25\ In 
FY 2011, the Commission will continue to reduce its use of hardcopy 
documents by not mailing out annual regulatory fee pre-bills, and 
instead place the pre-bill information on the Commission's Web site for 
licensees to access through the Commission's electronic filing and 
payment system (``Fee Filer''). Regulatees can also look to the 
Commission's Web site for information on upcoming events and deadlines 
relating to regulatory fees. We ask whether further changes to our 
system of electronic notification would serve to more efficiently and 
effectively inform regulatees of information and procedures pertaining 
to regulatory fees.
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    \23\ Geostationary orbit space station (``GSO'') licensees 
received regulatory fee pre-bills for satellites that (1) were 
licensed by the Commission and operational on or before October 1 of 
the respective fiscal year; and (2) were not co-located with and 
technically identical to another operational satellite on that date 
(i.e., were not functioning as a spare satellite). Non-geostationary 
orbit space station (``NGSO'') licensees received regulatory fee 
pre-bills for systems that were licensed by the Commission and 
operational on or before October 1 of the respective fiscal year.
    \24\ A pre-bill is considered an account receivable in the 
Commission's accounting system. Pre-bills reflect the amount owed 
and have a payment due date of the last day of the regulatory fee 
payment window. Consequently, if a pre-bill is not paid by the due 
date, it becomes delinquent and is subject to our debt collection 
procedures. See also 47 CFR 1.1161(c), 1.1164(f)(5), and 1.1910.
    \25\ See FY 2009 Report and Order at paras. 24, 26.
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IV. Procedural Matters

    21. Included below are procedural items as well as our current 
payment and collection methods which we have revised over the past 
several years to expedite the processing of regulatory fee payments. We 
do not propose changes to these procedures. Rather, we include them 
here as a useful way of reminding regulatory fee payers and the public 
about these aspects of the annual regulatory fee collection process.

A. Public Notices and Fact Sheets

    22. Each year we post public notices and fact sheets pertaining to 
regulatory fees on our Web site. These documents contain information 
about the payment due date and relevant regulatory fee payment 
procedures. We will continue to post this information on http://www.fcc.gov/fees/regfees.html, but as in previous years, we will not 
send out public notices and fact sheets to regulatees en masse.

B. Assessment Notifications

1. Media Services Licensees
    23. Beginning in FY 2003, we sent fee assessment notifications via 
surface mail to media services entities on a per-facility basis.\26\ 
These notifications provided the assessed fee amount for the facility 
in question, as well as the data attributes that determined the fee 
amount. We have since refined this initiative to be more electronic and 
paperless.\27\ In our FY 2010 NPRM, we proposed to discontinue mailing 
the media notifications beginning in FY 2011, relying instead on 
information on the Commission's Web site and the use of the Commission-
authorized Web site at http://www.fccfees.com.\28\ We kept the comment 
and reply comment period open until September 30, 2010 to be receptive 
to the needs of media licensees. We received no comments or reply 
comments on this particular issue. Therefore, beginning in FY 2011, we 
will discontinue mailing hardcopy notification assessment letters to 
media licensees.
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    \26\ As stated previously in a footnote, a pre-bill is 
considered an account receivable in the Commission's accounting 
system. Pre-bills include an amount owed and have a payment due date 
of the last day of the regulatory fee payment window. If a pre-bill 
is not paid by the due date, it becomes delinquent and is subject to 
our debt collection procedures. On the other hand, an assessment is 
a proposed statement of the amount of regulatory fees owed by an 
entity to the Commission (or proposed subscriber count to be 
ascribed for purposes of setting the entity's regulatory fee), but 
it is not entered into the Commission's accounting system as a 
current debt.
    \27\ Some of those refinements have been to provide licensees 
with a Commission-authorized Web site to update or correct any 
information concerning their facilities, and to amend their fee-
exempt status, if need be. The notifications also provide licensees 
with a telephone number to call in the event that they need customer 
assistance.
    \28\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2010, Report and Order, 25 FCC Rcd 9278 at para. 42 (2010) 
(``FY 2010 Report and Order'').
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    24. Every ten years, when the United States Census data is 
released, this data is incorporated into the population counts of AM & 
FM radio stations on a county basis. These population counts, along 
with the station's class and type of service, are the basis for 
determining regulatory fees. Although the 2010 Census data has been 
completed, the data is still subject to revisions. In addition, because 
FY 2011 regulatory fees are determined on the basis of the station's 
attributes as of October 1, 2010, it would be inappropriate to apply 
incomplete 2010 Census data in

[[Page 30618]]

determining FY 2011 regulatory fees for radio stations. Therefore, we 
will apply 2010 Census data in determining the population counts of 
radio stations as of October 1, 2011, as part of our calculations of FY 
2012 regulatory fees.
2. CMRS Cellular and Mobile Services Assessments
    25. As we have done in prior years, our procedures for conveying 
CMRS subscriber counts to providers are as follows. We will mail an 
initial assessment letter to Commercial Mobile Radio Service (CMRS) 
providers using data from the Numbering Resource Utilization Forecast 
(``NRUF'') report that is based on ``assigned'' number counts that have 
been adjusted for porting to net Type 0 ports (``in'' and ``out'').\29\ 
The letter will include a listing of the carrier's Operating Company 
Numbers (``OCNs'') upon which the assessment is based.\30\ The letters 
will not include OCNs with their respective assigned number counts, but 
rather, an aggregate total of assigned numbers for each carrier.
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    \29\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2005 and Assessment and Collection of Regulatory Fees for 
Fiscal Year 2004, MD Docket Nos. 05-59 and 04-73, Report and Order 
and Order on Reconsideration, 20 FCC Rcd 12259, 12264, paras. 38-44 
(2005).
    \30\ Id.
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    26. A carrier wishing to revise their subscriber count can access 
Fee Filer within a designated time frame to revise their count. 
Providers should follow the prompts in Fee Filer to record their 
subscriber revisions, along with any supporting documentation.\31\ The 
Commission will then review the revised count and supporting 
documentation and either approve or disapprove the submission in Fee 
Filer. If the submission is disapproved, the Commission will attempt to 
contact the provider so that the provider will have an opportunity to 
discuss its revised subscriber count and/or provide additional 
supporting documentation. If we receive no response or correction to 
the initial assessment letter, or we do not reverse the disapproval of 
the provider's revised count submission, we will expect the fee payment 
to be based on the number of subscribers listed on the initial 
assessment letter. Once the timeframe for revision has passed, the 
subscriber counts will be finalized. These subscriber counts will then 
be the basis upon which CMRS regulatory fees will be expected. 
Providers will be able to view their final subscriber counts online in 
Fee Filer. A final CMRS assessment letter will not be mailed out.
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    \31\ In the supporting documentation, the provider will need to 
state a reason for the change, such as a purchase or sale of a 
subsidiary, the date of the transaction, and any other pertinent 
information that will help to justify a reason for the change.
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    27. Because some carriers do not file the NRUF report, they may not 
receive an initial letter of assessment. In these instances, the 
carriers should compute their fee payment using the standard 
methodology \32\ that is currently in place for CMRS Wireless services 
(e.g., compute their subscriber counts as of December 31, 2010), and 
submit their fee payment accordingly. Whether a carrier receives an 
assessment letter or not, the Commission reserves the right to audit 
the number of subscribers for which regulatory fees are paid. In the 
event that the Commission determines that the number of subscribers 
paid is inaccurate, the Commission will bill the carrier for the 
difference between what was paid and what should have been paid.
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    \32\ See, e.g., Federal Communications Commission, Regulatory 
Fees Fact Sheet: What You Owe--Commercial Wireless Services for FY 
2010 at 1 (released September 2010).
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3. Submarine Cable Allocation
    28. The Commission collects a revenue amount each year based on a 
Congressional mandate. Because the dollar amount differs each year, a 
revenue apportionment is required each year to determine the projected 
regulatory fee revenue to be collected from submarine cable providers 
and from terrestrial/satellite facilities.\33\ Since FY 2009, the 
Commission has used the 87.4/12.6 percent allocation proposed in the 
Consensus Proposal as the percentage upon which to determine the 
regulatory fee revenue amounts for submarine cable providers and 
terrestrial/satellite facilities, respectively.\34\ Each year, the 
Commission reserves the right to revise this 87.4/12.6 allocation. 
Although we will continue to review this allocation as part of our 
annual regulatory fee proceeding, we do not at this time find any basis 
to alter the 87.4/12.6 percent revenue allocation for 2011 regulatory 
fees.
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    \33\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2008, Second Report and Order, 24 FCC Rcd 4208 at n. 35 (2009) 
(``Submarine Cable Order'').
    \34\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2009, Report and Order, 24 FCC Rcd 10301 at para. 8 (2009) 
(``FY 2009 Report and Order'').
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4. Re-Assessment of Regulatory Fee Issues in a Further Notice of 
Proposed Rulemaking
    29. Since 1994 when the first regulatory fees were collected, the 
communications industry has undergone a rapid transformation. The 
current basis of how regulatory fees are assessed, however, has changed 
only slightly since its inception in 1994.\35\ In FY 2008, the 
Commission released a FNPRM which identified some of the issues raised 
by commenters with regard to the need for fundamental reform of our 
regulatory fee assessment methodology \36\ From this rulemaking, the 
Commission has already acted on three of the issues: 1) a change in the 
bearer circuit methodology for calculating regulatory fees, 2) the 
elimination of two regulatory fee categories, the International Public 
Fixed Radio and International High Frequency Broadcast Stations, and 3) 
the conversion of UHF and VHF Television stations from analog to 
digital television. In our FY 2010 Regulatory Fees Report & Order, we 
stated that in a future proceeding, we will ``further examine the 
nature and extent of all changes that need to be made to our regulatory 
fee schedule and calculations. In a separate and forthcoming action, we 
will call for comment on issues including, but not limited to, how 
changes in the telecommunications marketplace may warrant rebalancing 
of regulatory fees among existing service providers * * *''\37\ As our 
commitment to this ``forthcoming action'', the Commission will by the 
end of 2011, initiate a further rulemaking that will update the record 
on regulatory fee rebalancing, as well as expand this inquiry to 
include new issues and services not covered by the 2008 FNPRM, such as 
whether and how to re-assess the regulatory fee burden of all fee 
categories, whether to incorporate 499-A wireless revenue in the 
calculation of ITSP regulatory fees, and whether to eliminate the 
regulatory fee portion (but not the application fee portion) of General 
Mobile Radio Service (GMRS).
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    \35\ 47 U.S.C. 159(a) and 159(b).
    \36\ Assessment and Collection of Regulatory Fees for Fiscal 
Year 2008, MD Docket No. 08-65, RM-11312, Report and Order and 
Further Notice of Proposed Rulemaking, 73 FR 50201 (August 26, 2008) 
at paras. 38-41.
    \37\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2010, MD Docket No. 10-87, Report and Order, 25 FCC Rcd 9278 
para. 31 (2010).
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C. Streamlined Regulatory Fee Payment Process

1. Cable Television Subscribers
    30. We will continue to permit cable television operators to base 
their regulatory fee payment on their company's aggregate year-end 
subscriber count, rather than requiring them to report cable subscriber 
counts on a per community unit identifier (``CUID'') basis.

[[Page 30619]]

2. CMRS Cellular and Mobile Providers
    31. In FY 2006, we streamlined the CMRS payment process by 
eliminating the requirement for CMRS providers to identify their 
individual call signs when making their regulatory fee payment, instead 
allowing CMRS providers to pay their regulatory fees only at the 
aggregate subscriber level without having to identify their various 
call signs.\38\ We will continue this practice in FY 2011. In FY 2007, 
we consolidated the CMRS cellular and CMRS mobile fee categories into 
one fee category with a single fee code, thereby eliminating the 
requirement for CMRS providers to separate their subscriber counts into 
CMRS cellular and CMRS mobile fee categories during the regulatory fee 
payment process. This consolidation of fee categories enabled the 
Commission to process payments more quickly and accurately. For FY 
2011, we will continue this practice of combining the CMRS cellular and 
CMRS mobile fee categories into one regulatory fee category.
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    \38\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2006, MD Docket No. 06-68, Report and Order, 21 FCC Rcd 8092, 
8105, para. 48 (2006).
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3. Interstate Telecommunications Service Providers (``ITSP'')
    32. In FY 2007, we adopted a proposal to round lines 14 (total 
subject revenues) and 16 (total regulatory fee owed) on FCC Form 159-W 
to the nearest dollar. This revision enabled the Commission to process 
the ITSP regulatory fee payments more quickly because rounding was 
performed in a consistent manner and eliminated processing issues that 
occurred in prior years. In FY 2011, we will continue rounding lines 14 
and 16 when calculating the FY 2011 ITSP fee obligation. In addition, 
we will continue the practice of not mailing out Form 159-W via surface 
mail.

D. Payment of Regulatory Fees

1. Lock Box Bank
    33. All lock box payments to the Commission for FY 2011 will be 
processed by U.S. Bank, St. Louis, Missouri, and payable to the FCC. 
During the regulatory fee season, for those licensees paying by check, 
money order, or by credit card using Form 159-E remittance advice, the 
fee payment and Form 159-E remittance advice should be mailed to the 
following address: Federal Communications Commission, Regulatory Fees, 
P.O. Box 979084, St. Louis, MO 63197-9000. Additional payment options 
and instructions are posted at http://www.fcc.gov/fees/regfees.html.
2. Receiving Bank for Wire Payments
    34. The receiving bank for all wire payments is the Federal Reserve 
Bank, New York, New York (TREAS NYC). When making a wire transfer, 
regulatees must fax a copy of their Fee Filer generated Form 159-E to 
U.S. Bank, St. Louis, Missouri at (314) 418-4232 at least one hour 
before initiating the wire transfer (but on the same business day), so 
as not to delay crediting their account. Regulatees should discuss 
arrangements (including bank closing schedules) with their bankers 
several days before they plan to make the wire transfer to allow 
sufficient time for the transfer to be initiated and completed before 
the deadline. Complete instructions for making wire payments are posted 
at http://www.fcc.gov/fees/wiretran.html.
3. De Minimis Regulatory Fees
    35. Regulatees whose total FY 2011 regulatory fee liability, 
including all categories of fees for which payment is due, is less than 
$10 are exempted from payment of FY 2011 regulatory fees.
4. Standard Fee Calculations and Payment Dates
    36. The Commission will accept fee payments made in advance of the 
window for the payment of regulatory fees. The responsibility for 
payment of fees by service category is as follows:
     Media Services: Regulatory fees must be paid for initial 
construction permits that were granted on or before October 1, 2010 for 
AM/FM radio stations, VHF/UHF full service television stations, and 
satellite television stations. Regulatory fees must be paid for all 
broadcast facility licenses granted on or before October 1, 2010. In 
instances where a permit or license is transferred or assigned after 
October 1, 2010, responsibility for payment rests with the holder of 
the permit or license as of the fee due date.
     Wireline (Common Carrier) Services: Regulatory fees must 
be paid for authorizations that were granted on or before October 1, 
2010. In instances where a permit or license is transferred or assigned 
after October 1, 2010, responsibility for payment rests with the holder 
of the permit or license as of the fee due date. We note that audio 
bridging service providers are included in this category.\39\
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    \39\ Audio bridging services are toll teleconferencing services, 
and audio bridging service providers are required to contribute 
directly to the universal service fund based on revenues from these 
services. On June 30, 2008, the Commission released the InterCall 
Order, in which the Commission stated that InterCall, Inc. and all 
similarly situated audio bridging service providers are required to 
contribute directly to the universal service fund. See Request for 
Review by InterCall, Inc. of Decision of Universal Service 
Administrator, CC Docket No. 96-45, Order, 23 FCC Rcd 10731 (2008) 
(``InterCall Order'').
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     Wireless Services: CMRS cellular, mobile, and messaging 
services (fees based on number of subscribers or telephone number 
count): Regulatory fees must be paid for authorizations that were 
granted on or before October 1, 2010. The number of subscribers, units, 
or telephone numbers on December 31, 2010 will be used as the basis 
from which to calculate the fee payment. In instances where a permit or 
license is transferred or assigned after October 1, 2010, 
responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
     The first eleven regulatory fee categories in our Schedule 
of Regulatory Fees (see Table--Schedule of Regulatory Fees) pay ``small 
multi-year wireless regulatory fees.'' Entities pay these regulatory 
fees in advance for the entire amount of their five-year or ten-year 
term of initial license, and only pay regulatory fees again when the 
license is renewed or a new license is obtained. We include these fee 
categories in our Schedule of Regulatory Fees to publicize our 
estimates of the number of ``small multi-year wireless'' licenses that 
will be renewed or newly obtained in FY 2011.
     Multichannel Video Programming Distributor Services (cable 
television operators and CARS licensees): Regulatory fees must be paid 
for the number of basic cable television subscribers as of December 31, 
2010.\40\ Regulatory fees also must be paid for CARS licenses that were 
granted on or before October 1, 2010. In instances where a permit or 
license is transferred or assigned after October 1, 2010, 
responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
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    \40\ Cable television system operators should compute their 
basic subscribers as follows: Number of single family dwellings + 
number of individual households in multiple dwelling unit 
(apartments, condominiums, mobile home parks, etc.) paying at the 
basic subscriber rate + bulk rate customers + courtesy and free 
service. Note: Bulk-Rate Customers = Total annual bulk-rate charge 
divided by basic annual subscription rate for individual households. 
Operators may base their count on ``a typical day in the last full 
week'' of December 2010, rather than on a count as of December 31, 
2010.
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     International Services: Regulatory fees must be paid for 
earth stations, geostationary orbit space stations and non-
geostationary orbit satellite systems that were licensed and 
operational on or before October 1, 2010. In instances

[[Page 30620]]

where a permit or license is transferred or assigned after October 1, 
2010, responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
     International Services: Submarine Cable Systems: 
Regulatory fees for submarine cable systems are to be paid on a per 
cable landing license basis based on circuit capacity as of December 
31, 2010. In instances where a license is transferred or assigned after 
October 1, 2010, responsibility for payment rests with the holder of 
the license as of the fee due date. For regulatory fee purposes, the 
allocation in FY 2011 will remain at 87.6 percent for submarine cable 
and 12.4 percent for satellite/terrestrial facilities.
     International Services: Terestrial and Satellite Services: 
Finally, regulatory fees for International Bearer Circuits are to be 
paid by facilities-based common carriers that have active (used or 
leased) international bearer circuits as of December 31, 2010 in any 
terrestrial or satellite transmission facility for the provision of 
service to an end user or resale carrier, which includes active 
circuits to themselves or to their affiliates. In addition, non-common 
carrier satellite operators must pay a fee for each circuit sold or 
leased to any customer, including themselves or their affiliates, other 
than an international common carrier authorized by the Commission to 
provide U.S. international common carrier services. ``Active circuits'' 
for these purposes include backup and redundant circuits as of December 
31, 2010. Whether circuits are used specifically for voice or data is 
not relevant for these purposes in determining that they are active 
circuits. In instances where a permit or license is transferred or 
assigned after October 1, 2010, responsibility for payment rests with 
the holder of the permit or license as of the fee due date. For 
regulatory fee purposes, the allocation in FY 2011 will remain at 87.6 
percent for submarine cable and 12.4 percent for satellite/terrestrial 
facilities.

E. Enforcement

    37. To be considered timely, regulatory fee payments must be 
received and stamped at the lockbox bank by the last day of the 
regulatory fee filing window. Section 9(c) of the Act requires us to 
impose a late payment penalty of 25 percent of the unpaid amount to be 
assessed on the first day following the deadline date for filing of 
these fees.\41\ Failure to pay regulatory fees and/or any late penalty 
will subject regulatees to sanctions, including those set forth in 
section 1.1910 of the Commission's rules \42\ and in the Debt 
Collection Improvement Act of 1996 (``DCIA'').\43\ We also assess 
administrative processing charges on delinquent debts to recover 
additional costs incurred in processing and handling the related debt 
pursuant to the DCIA and section 1.1940(d) of the Commission's 
rules.\44\ These administrative processing charges will be assessed on 
any delinquent regulatory fee, in addition to the 25 percent late 
charge penalty. In case of partial payments (underpayments) of 
regulatory fees, the licensee will be given credit for the amount paid, 
but if it is later determined that the fee paid is incorrect or not 
timely paid, then the 25 percent late charge penalty (and other charges 
and/or sanctions, as appropriate) will be assessed on the portion that 
is not paid in a timely manner.
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    \41\ 47 U.S.C. 159(c).
    \42\ See 47 CFR 1.1910.
    \43\ Delinquent debt owed to the Commission triggers application 
of the ``red light rule'' which requires offsets or holds on pending 
disbursements. 47 CFR 1.1910. In 2004, the Commission adopted rules 
implementing the requirements of the DCIA. See Amendment of Parts 0 
and 1 of the Commission's Rules, MD Docket No. 02-339, Report and 
Order, 19 FCC Rcd 6540 (2004); 47 CFR Part 1, Subpart O, Collection 
of Claims Owed the United States.
    \44\ 47 CFR 1.1940(d).
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    38. We will withhold action on any applications or other requests 
for benefits filed by anyone who is delinquent in any non-tax debts 
owed to the Commission (including regulatory fees) and will ultimately 
dismiss those applications or other requests if payment of the 
delinquent debt or other satisfactory arrangement for payment is not 
made.\45\ Failure to pay regulatory fees can also result in the 
initiation of a proceeding to revoke any and all authorizations held by 
the entity responsible for paying the delinquent fee(s).

    \45\ See 47 CFR 1.1161(c), 1.1164(f)(5), and 1.1910.
---------------------------------------------------------------------------

BILLING CODE 6712-01-P

[[Page 30621]]

[GRAPHIC] [TIFF OMITTED] TP26MY11.012


[[Page 30622]]


[GRAPHIC] [TIFF OMITTED] TP26MY11.013

BILLING CODE 6712-01-C

                                                 Table--Reference to FY 2010 Schedule of Regulatory Fees
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          FY 2010 radio station regulatory fees
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           FM Classes A,   FM Classes B,
                    Population served                       AM Class A      AM Class B      AM Class C      AM Class D        B1 & C3     C, C0, C1 & C2
--------------------------------------------------------------------------------------------------------------------------------------------------------
<=25,000................................................            $675            $550            $500            $575            $650            $825
25,001-75,000...........................................           1,350           1,075             750             875           1,325           1,450
75,001-150,000..........................................           2,025           1,350           1,000           1,450           1,825           2,725
150,001-500,000.........................................           3,050           2,300           1,500           1,725           2,800           3,550
500,001-1,200,000.......................................           4,400           3,500           2,500           2,875           4,450           5,225
1,200,001-3,000,000.....................................           6,750           5,400           3,750           4,600           7,250           8,350
>3,000,000..............................................           8,100           6,475           4,750           5,750           9,250          10,850
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 30623]]


                                                 Table--Reference to FY 2010 Schedule of Regulatory Fees
                                                    [International Bearer Circuits--Submarine Cable]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Submarine cable systems (capacity as of
           December 31, 2009)              Fee amount                                                Address
--------------------------------------------------------------------------------------------------------------------------------------------------------
< 2.5 Gbps.............................         $14,625  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
2.5 Gbps or greater, but less than 5             29,250  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
 Gbps.
5 Gbps or greater, but less than 10              58,500  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
 Gbps.
10 Gbps or greater, but less than 20            116,975  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
 Gbps.
20 Gbps or greater.....................         233,950  FCC, International, P.O. Box 979084, St. Louis, MO 63197-9000.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Initial Regulatory Flexibility Analysis

    39. As required by the Regulatory Flexibility Act (``RFA''),\46\ 
the Commission prepared this Initial Regulatory Flexibility Analysis 
(``IRFA'') of the possible significant economic impact on small 
entities by the policies and rules proposed in this NPRM. Written 
public comments are requested on this IRFA. Comments must be identified 
as responses to the IRFA and must be filed on or before the dates 
indicated on the first page of this NPRM. The Commission will send a 
copy of the Notice, including the IRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration.\47\ In addition, the 
Notice and IRFA (or summaries thereof) will be published in the Federal 
Register.\48\
---------------------------------------------------------------------------

    \46\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended by 
the Contract With America Advancement Act of 1996, Public Law 104-
121, 110 Stat. 847 (1996) (``CWAAA''). Title II of the CWAAA is the 
Small Business Regulatory Enforcement Fairness Act of 1996 
(``SBREFA'').
    \47\ 5 U.S.C. 603(a).
    \48\ Id.
---------------------------------------------------------------------------

A. Need for, and Objectives of, the Notice

    40. This rulemaking proceeding was initiated for the Commission to 
obtain comments regarding its proposed amendment to its Schedule of 
Regulatory Fees in the amount of $335,794,000, which is the amount that 
Congress has required the Commission to recover. The Commission seeks 
to collect the necessary amount through its revised Schedule of 
Regulatory Fees in the most efficient manner possible and without undue 
public burden.

B. Legal Basis

    41. This action, including publication of proposed rules, is 
authorized under Sections (4)(i) and (j), 9, and 303(r) of the 
Communications Act of 1934, as amended.\49\
---------------------------------------------------------------------------

    \49\ 47 U.S.C. 154(i) and (j), 159, and 303(r).
---------------------------------------------------------------------------

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

    42. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules and policies, if adopted.\50\ The RFA 
generally defines the term ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' \51\ In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act.\52\ A ``small business concern'' is one 
which: (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.\53\
---------------------------------------------------------------------------

    \50\ 5 U.S.C. 603(b)(3).
    \51\ 5 U.S.C. 601(6).
    \52\ 5 U.S.C. 601(3) (incorporating by reference the definition 
of ``small-business concern'' in the Small Business Act, 15 U.S.C. 
632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a 
small business applies ``unless an agency, after consultation with 
the Office of Advocacy of the Small Business Administration and 
after opportunity for public comment, establishes one or more 
definitions of such term which are appropriate to the activities of 
the agency and publishes such definition(s) in the Federal 
Register.''
    \53\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    43. Small Businesses. Nationwide, there are a total of 
approximately 29.6 million small businesses, according to the SBA.\54\
---------------------------------------------------------------------------

    \54\ See SBA, Office of Advocacy, ``Frequently Asked 
Questions,'' http://web.sba.gov/faqs (accessed Jan. 2009).
---------------------------------------------------------------------------

    44. Small Organizations. Nationwide, as of 2002, there are 
approximately 1.6 million small organizations.\55\ A ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.'' 
\56\
---------------------------------------------------------------------------

    \55\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
    \56\ 5 U.S.C. 601(4).
---------------------------------------------------------------------------

    45. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, towns, 
townships, villages, school districts, or special districts, with a 
population of less than fifty thousand.'' \57\ Census Bureau data for 
2002 indicate that there were 87,525 local governmental jurisdictions 
in the United States.\58\ We estimate that, of this total, 84,377 
entities were ``small governmental jurisdictions.'' \59\ Thus, we 
estimate that most governmental jurisdictions are small.
---------------------------------------------------------------------------

    \57\ 5 U.S.C. 601(5).
    \58\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2006, Section 8, p. 272, Table 415.
    \59\ We assume that the villages, school districts, and special 
districts are small, and total 48,558. See U.S. Census Bureau, 
Statistical Abstract of the United States: 2006, Section 8, p. 273, 
Table 417. For 2002, Census Bureau data indicate that the total 
number of county, municipal, and township governments nationwide was 
38,967, of which 35,819 were small. Id.
---------------------------------------------------------------------------

    46. We have included small incumbent local exchange carriers in 
this present RFA analysis. As noted above, a ``small business'' under 
the RFA is one that, inter alia, meets the pertinent small business 
size standard (e.g., a telephone communications business having 1,500 
or fewer employees), and ``is not dominant in its field of operation.'' 
\60\ The SBA's Office of Advocacy contends that, for RFA purposes, 
small incumbent local exchange carriers are not dominant in their field 
of operation because any such dominance is not ``national'' in 
scope.\61\ We have therefore included small incumbent local exchange 
carriers in this RFA analysis, although we emphasize that this RFA 
action has no effect on Commission analyses and determinations in 
other, non-RFA contexts.
---------------------------------------------------------------------------

    \60\ 15 U.S.C. 632.
    \61\ Letter from Jere W. Glover, Chief Counsel for Advocacy, 
SBA, to William E. Kennard, Chairman, FCC (May 27, 1999). The Small 
Business Act contains a definition of ``small-business concern,'' 
which the RFA incorporates into its own definition of ``small 
business.'' See 15 U.S.C. 632(a) (``Small Business Act''); 5 U.S.C. 
601(3) (``RFA''). SBA regulations interpret ``small business 
concern'' to include the concept of dominance on a national basis. 
See 13 CFR 121.102(b).
---------------------------------------------------------------------------

    47. Incumbent Local Exchange Carriers (``ILECs''). Neither the 
Commission nor the SBA has developed a small business size standard 
specifically for incumbent local

[[Page 30624]]

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.\62\ According to Commission data,\63\ 1,311 carriers have 
reported that they are engaged in the provision of incumbent local 
exchange services. Of these 1,311 carriers, an estimated 1,024 have 
1,500 or fewer employees and 287 have more than 1,500 employees. 
Consequently, the Commission estimates that most providers of incumbent 
local exchange service are small businesses that may be affected by our 
action.
---------------------------------------------------------------------------

    \62\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110.
    \63\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
Page 5-5 (Aug. 2008) (``Trends in Telephone Service''). This source 
uses data that are current as of November 1, 2006.
---------------------------------------------------------------------------

    48. Competitive Local Exchange Carriers (``CLECs''), 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.\64\ According to Commission data,\65\ 1,005 carriers have 
reported that they are engaged in the provision of either competitive 
access provider services or competitive local exchange carrier 
services. Of these 1,005 carriers, an estimated 918 have 1,500 or fewer 
employees and 87 have more than 1,500 employees. In addition, 16 
carriers have reported that they are ``Shared-Tenant Service 
Providers,'' and all 16 are estimated to have 1,500 or fewer employees. 
In addition, 89 carriers have reported that they are ``Other Local 
Service Providers.'' Of the 89, all have 1,500 or fewer 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 our action.
---------------------------------------------------------------------------

    \64\ 13 CFR 121.201, NAICS code 517110.
    \65\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    49. 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.\66\ According to Commission data,\67\ 151 carriers have 
reported that they are engaged in the provision of local resale 
services. Of these, an estimated 149 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 our action.
---------------------------------------------------------------------------

    \66\ 13 CFR 121.201, NAICS code 517310.
    \67\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    50. 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.\68\ According to Commission data,\69\ 815 carriers have 
reported that they are engaged in the provision of toll resale 
services. Of these, an estimated 787 have 1,500 or fewer employees and 
28 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 action.
---------------------------------------------------------------------------

    \68\ 13 CFR 121.201, NAICS code 517310.
    \69\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    51. 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.\70\ According to Commission data,\71\ 526 carriers have 
reported that they are engaged in the provision of payphone services. 
Of these, an estimated 524 have 1,500 or fewer employees and two 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.
---------------------------------------------------------------------------

    \70\ 3 CFR 121.201, NAICS code 517110.
    \71\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    52. Interexchange Carriers (``IXCs''). 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.\72\ According to Commission data,\73\ 300 carriers 
have reported that they are engaged in the provision of interexchange 
service. Of these, an estimated 268 have 1,500 or fewer employees and 
32 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of IXCs are small entities that may be 
affected by our action.
---------------------------------------------------------------------------

    \72\ 13 CFR 121.201, NAICS code 517110.
    \73\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    53. 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.\74\ According to Commission data,\75\ 28 carriers have 
reported that they are engaged in the provision of operator services. 
Of these, an estimated 27 have 1,500 or fewer employees and one has 
more than 1,500 employees. Consequently, the Commission estimates that 
the majority of OSPs are small entities that may be affected by our 
action.
---------------------------------------------------------------------------

    \74\ 13 CFR 121.201, NAICS code 517110.
    \75\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    54. 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.\76\ According to Commission data,\77\ 88 carriers have 
reported that they are engaged in the provision of prepaid calling 
cards. Of these, an estimated 85 have 1,500 or fewer employees and 
three 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 our action.
---------------------------------------------------------------------------

    \76\ 13 CFR 121.201, NAICS code 517310.
    \77\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    55. 800 and 800-Like Service Subscribers.\78\ 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.\79\ The most reliable 
source of information regarding the number of these service subscribers 
appears to be data the Commission receives from Database Service 
Management on the 800, 866, 877, and 888 numbers in

[[Page 30625]]

use.\80\ According to our data, at the end of December 2007, the number 
of 800 numbers assigned was 7,860,000; the number of 888 numbers 
assigned was 5,210,184; the number of 877 numbers assigned was 
4,388,682; and the number of 866 numbers assigned was 7,029,116. We do 
not have data specifying the number of these subscribers that are 
independently owned and operated or have 1,500 or fewer 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, we estimate that there are 
7,860,000 or fewer small entity 800 subscribers; 5,210,184 or fewer 
small entity 888 subscribers; 4,388,682 or fewer small entity 877 
subscribers, and 7,029,116 or fewer entity 866 subscribers.
---------------------------------------------------------------------------

    \78\ We include all toll-free number subscribers in this 
category.
    \79\ 13 CFR 121.201, NAICS code 517310.
    \80\ ``Trends in Telephone Service'' at Tables 18.4, 18.5, 18.6, 
and 18.7.
---------------------------------------------------------------------------

    56. Satellite Telecommunications and All Other Telecommunications. 
These 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.\81\ The second has a 
size standard of $25 million or less in annual receipts.\82\ The most 
current Census Bureau data in this context, however, are from the 
(last) economic census of 2002, and we will use those figures to gauge 
the prevalence of small businesses in these categories.\83\
---------------------------------------------------------------------------

    \81\ 13 CFR 121.201, NAICS code 517410.
    \82\ 13 CFR 121.201, NAICS code 517919.
    \83\ 13 CFR 121.201, NAICS codes 517410 and 517910 (2002).
---------------------------------------------------------------------------

    57. 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.'' \84\ For this category, Census Bureau data for 
2002 show that there were a total of 371 firms that operated for the 
entire year.\85\ Of this total, 307 firms had annual receipts of under 
$10 million, and 26 firms had receipts of $10 million to 
$24,999,999.\86\ Consequently, we estimate that the majority of 
Satellite Telecommunications firms are small entities that might be 
affected by our action.
---------------------------------------------------------------------------

    \84\ U.S. Census Bureau, 2007 NAICS Definitions, ``517410 
Satellite Telecommunications''; http://www.census.gov/naics/2007/def/ND517410.HTM.
    \85\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517410 (issued Nov. 2005).
    \86\ Id. An additional 38 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    58. The second category of All Other Telecommunications comprises, 
inter alia, ``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.'' \87\ For 
this category, Census Bureau data for 2002 show that there were a total 
of 332 firms that operated for the entire year.\88\ Of this total, 303 
firms had annual receipts of under $10 million and 15 firms had annual 
receipts of $10 million to $24,999,999.\89\ Consequently, we estimate 
that the majority of All Other Telecommunications firms are small 
entities that might be affected by our action.
---------------------------------------------------------------------------

    \87\ U.S. Census Bureau, 2007 NAICS Definitions, ``517919 All 
Other Telecommunications''; http://www.census.gov/naics/2007/def/ND517919.HTM#N517919.
    \88\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517910 (issued Nov. 2005).
    \89\ Id. An additional 14 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    59. Wireless Telecommunications Carriers (except Satellite). Since 
2007, the Census Bureau has placed wireless firms within this new, 
broad, economic census category.\90\ Prior to that time, such firms 
were within the now-superseded categories of ``Paging'' and ``Cellular 
and Other Wireless Telecommunications.'' \91\ Under the present and 
prior categories, the SBA has deemed a wireless business to be small if 
it has 1,500 or fewer employees.\92\ Because Census Bureau data are not 
yet available for the new category, we will estimate small business 
prevalence using the prior categories and associated data. For the 
category of Paging, data for 2002 show that there were 807 firms that 
operated for the entire year.\93\ Of this total, 804 firms had 
employment of 999 or fewer employees, and three firms had employment of 
1,000 employees or more.\94\ For the category of Cellular and Other 
Wireless Telecommunications, data for 2002 show that there were 1,397 
firms that operated for the entire year.\95\ Of this total, 1,378 firms 
had employment of 999 or fewer employees, and 19 firms had employment 
of 1,000 employees or more.\96\ Thus, we estimate that the majority of 
wireless firms are small.
---------------------------------------------------------------------------

    \90\ U.S. Census Bureau, 2007 NAICS Definitions, ``517210 
Wireless Telecommunications Categories (Except Satellite)''; http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
    \91\ U.S. Census Bureau, 2002 NAICS Definitions, ``517211 
Paging''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. 
Census Bureau, 2002 NAICS Definitions, ``517212 Cellular and Other 
Wireless Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \92\ 13 CFR 121.201, NAICS code 517210 (2007 NAICS). The now-
superseded, pre-2007 CFR citations were 13 CFR 121.201, NAICS codes 
517211 and 517212 (referring to the 2002 NAICS).
    \93\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211 (issued Nov. 2005).
    \94\ Id. The census data do not provide a more precise estimate 
of the number of firms that have employment of 1,500 or fewer 
employees; the largest category provided is for firms with ``1000 
employees or more.''
    \95\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212 (issued Nov. 2005).
    \96\ Id. The census data do not provide a more precise estimate 
of the number of firms that have employment of 1,500 or fewer 
employees; the largest category provided is for firms with ``1000 
employees or more.''
---------------------------------------------------------------------------

    60. Auctions. Initially, we note that, as a general matter, the 
number of winning bidders that qualify as small businesses at the close 
of an 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.
    61. Common Carrier Paging. As noted, the SBA has developed a small 
business size standard for Wireless Telecommunications Carriers (except 
Satellite) firms within the broad economic census categories of 
``Cellular and Other Wireless Telecommunications.'' \97\ Since 2007, 
the Census Bureau has placed wireless firms within this new, broad, 
economic census category.\98\ Prior to that time, such firms were 
within the now-superseded categories of ``Paging'' and ``Cellular and 
Other Wireless Telecommunications.'' \99\ Under the present and prior 
categories, the SBA has deemed a wireless business to be small if it 
has 1,500 or fewer

[[Page 30626]]

employees.\100\ Because Census Bureau data are not yet available for 
the new category, we will estimate small business prevalence using the 
prior categories and associated data. For the category of Paging, data 
for 2002 show that there were 807 firms that operated for the entire 
year.\101\ Of this total, 804 firms had employment of 999 or fewer 
employees, and three firms had employment of 1,000 employees or 
more.\102\ For the category of Cellular and Other Wireless 
Telecommunications, data for 2002 show that there were 1,397 firms that 
operated for the entire year.\103\ Of this total, 1,378 firms had 
employment of 999 or fewer employees, and 19 firms had employment of 
1,000 employees or more.\104\ Thus, we estimate that the majority of 
wireless firms are small.
---------------------------------------------------------------------------

    \97\ 13 CFR 121.201, NAICS code 517212.
    \98\ U.S. Census Bureau, 2007 NAICS Definitions, ``517210 
Wireless Telecommunications Categories (Except Satellite)''; http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
    \99\ U.S. Census Bureau, 2002 NAICS Definitions, ``517211 
Paging''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. 
Census Bureau, 2002 NAICS Definitions, ``517212 Cellular and Other 
Wireless Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \100\ 13 CFR 121.201, NAICS code 517210 (2007 NAICS). The now-
superseded, pre-2007 CFR citations were 13 CFR 121.201, NAICS codes 
517211 and 517212 (referring to the 2002 NAICS).
    \101\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211 (issued Nov. 2005).
    \102\ Id. The census data do not provide a more precise estimate 
of the number of firms that have employment of 1,500 or fewer 
employees; the largest category provided is for firms with ``1000 
employees or more.''
    \103\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212 (issued Nov. 2005).
    \104\ Id. The census data do not provide a more precise estimate 
of the number of firms that have employment of 1,500 or fewer 
employees; the largest category provided is for firms with ``1000 
employees or more.''
---------------------------------------------------------------------------

    62. In addition, in the Paging Second Report and Order, the 
Commission adopted a size standard for ``small businesses'' for 
purposes of determining their eligibility for special provisions such 
as bidding credits and installment payments.\105\ 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.\106\ The SBA has approved this 
definition.\107\ An initial auction of Metropolitan Economic Area 
(``MEA'') licenses was conducted in the year 2000. Of the 2,499 
licenses auctioned, 985 were sold.\108\ Fifty-seven companies claiming 
small business status won 440 licenses.\109\ A subsequent auction of 
MEA and Economic Area (``EA'') licenses was held in the year 2001. Of 
the 15,514 licenses auctioned, 5,323 were sold.\110\ One hundred 
thirty-two companies claiming small business status purchased 3,724 
licenses. A third auction, consisting of 8,874 licenses in each of 175 
EAs and 1,328 licenses in all but three of the 51 MEAs, was held in 
2003. Seventy-seven bidders claiming small or very small business 
status won 2,093 licenses.\111\
---------------------------------------------------------------------------

    \105\ Revision of Part 22 and Part 90 of the Commission's Rules 
to Facilitate Future Development of Paging Systems, Second Report 
and Order, 12 FCC Rcd 2732, 2811-2812, paras. 178-181 (``Paging 
Second Report and Order''); see also Revision of Part 22 and Part 90 
of the Commission's Rules to Facilitate Future Development of Paging 
Systems, Memorandum Opinion and Order on Reconsideration, 14 FCC Rcd 
10030, 10085-10088, paras. 98-107 (1999).
    \106\ Paging Second Report and Order, 12 FCC Rcd at 2811, para. 
179.
    \107\ See Letter from Aida Alvarez, Administrator, SBA, to Amy 
Zoslov, Chief, Auctions and Industry Analysis Division, Wireless 
Telecommunications Bureau (``WTB''), FCC (Dec. 2, 1998) (``Alvarez 
Letter 1998'').
    \108\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \109\ See id.
    \110\ See ``Lower and Upper Paging Band Auction Closes,'' Public 
Notice, 16 FCC Rcd 21821 (WTB 2002).
    \111\ See ``Lower and Upper Paging Bands Auction Closes,'' 
Public Notice, 18 FCC Rcd 11154 (WTB 2003). The current number of 
small or very small business entities that hold wireless licenses 
may differ significantly from the number of such entities that won 
in spectrum auctions due to assignments and transfers of licenses in 
the secondary market over time. In addition, some of the same small 
business entities may have won licenses in more than one auction.
---------------------------------------------------------------------------

    63. Currently, there are approximately 74,000 Common Carrier Paging 
licenses. According to the most recent Trends in Telephone Service, 281 
carriers reported that they were engaged in the provision of ``paging 
and messaging'' services.\112\ Of these, an estimated 279 have 1,500 or 
fewer employees and two have more than 1,500 employees.\113\ We 
estimate that the majority of common carrier paging providers would 
qualify as small entities under the SBA definition.
---------------------------------------------------------------------------

    \112\ ``Trends in Telephone Service'' at Table 5.3.
    \113\ Id.
---------------------------------------------------------------------------

    64. 2.3 GHz 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.\114\ The 
SBA has approved these definitions.\115\ The Commission auctioned 
geographic area licenses in the WCS service. In the auction, which was 
conducted in 1997, there were seven bidders that won 31 licenses that 
qualified as very small business entities, and one bidder that won one 
license that qualified as a small business entity.
---------------------------------------------------------------------------

    \114\ Amendment of the Commission's Rules to Establish Part 27, 
the Wireless Communications Service (WCS), Report and Order, 12 FCC 
Rcd 10785, 10879, para. 194 (1997).
    \115\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    65. 1670-1675 MHz Services. An auction for one license in the 1670-
1675 MHz band was conducted in 2003. One license was awarded. The 
winning bidder was not a small entity.
    66. 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).\116\ Under the SBA small business size standard, a business 
is small if it has 1,500 or fewer employees.\117\ According to Trends 
in Telephone Service data, 434 carriers reported that they were engaged 
in wireless telephony.\118\ Of these, an estimated 222 have 1,500 or 
fewer employees and 212 have more than 1,500 employees.\119\ We have 
estimated that 222 of these are small under the SBA small business size 
standard.
---------------------------------------------------------------------------

    \116\ 13 CFR 121.201, NAICS code 517210.
    \117\ Id.
    \118\ ``Trends in Telephone Service'' at Table 5.3.
    \119\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    67. 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 has created a small business 
size standard for Blocks C and F as an entity that has average gross 
revenues of less than $40 million in the three previous calendar 
years.\120\ For Block F, 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.\121\ These 
small business size standards, in the context of broadband PCS 
auctions, have been approved by the SBA.\122\ No small businesses 
within the SBA-approved small business size standards bid successfully 
for licenses in Blocks A and B. There were 90 winning bidders that 
qualified as small entities in the Block C auctions. A total of 93 
``small'' and ``very small'' business bidders won approximately 40 
percent of the 1,479

[[Page 30627]]

licenses for Blocks D, E, and F.\123\ In 1999, the Commission 
reauctioned 155 C, D, E, and F Block licenses; there were 113 small 
business winning bidders.\124\
---------------------------------------------------------------------------

    \120\ See Amendment of Parts 20 and 24 of the Commission's 
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile 
Radio Service Spectrum Cap, Report and Order, 11 FCC Rcd 7824, 7850-
7852, paras. 57-60 (1996) (``PCS Report and Order''); see also 47 
CFR 24.720(b).
    \121\ See PCS Report and Order, 11 FCC Rcd at 7852, para. 60.
    \122\ See Alvarez Letter 1998.
    \123\ FCC News, ``Broadband PCS, D, E and F Block Auction 
Closes,'' No. 71744 (rel. Jan. 14, 1997).
    \124\ See ``C, D, E, and F Block Broadband PCS Auction Closes,'' 
Public Notice, 14 FCC Rcd 6688 (WTB 1999).
---------------------------------------------------------------------------

    68. In 2001, the Commission completed the auction of 422 C and F 
Broadband PCS licenses in Auction 35. Of the 35 winning bidders in this 
auction, 29 qualified as ``small'' or ``very small'' businesses.\125\ 
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. In 2005, the Commission completed an auction of 
188 C block licenses and 21 F block licenses in Auction 58. There were 
24 winning bidders for 217 licenses.\126\ Of the 24 winning bidders, 16 
claimed small business status and won 156 licenses. In 2007, the 
Commission completed an auction of 33 licenses in the A, C, and F 
Blocks in Auction 71.\127\ Of the 14 winning bidders, six were 
designated entities.\128\ In 2008, the Commission completed an auction 
of 20 Broadband PCS licenses in the C, D, E and F block licenses in 
Auction 78.\129\
---------------------------------------------------------------------------

    \125\ See ``C and F Block Broadband PCS Auction Closes; Winning 
Bidders Announced,'' Public Notice, 16 FCC Rcd 2339 (2001).
    \126\ See ``Broadband PCS Spectrum Auction Closes; Winning 
Bidders Announced for Auction No. 58,'' Public Notice, 20 FCC Rcd 
3703 (2005).
    \127\ See ``Auction of Broadband PCS Spectrum Licenses Closes; 
Winning Bidders Announced for Auction No. 71,'' Public Notice, 22 
FCC Rcd 9247 (2007).
    \128\ Id.
    \129\ See Auction of AWS-1 and Broadband PCS Licenses 
Rescheduled For August 13, 2008, Notice of Filing Requirements, 
Minimum Opening Bids, Upfront Payments and Other Procedures For 
Auction 78, Public Notice, 23 FCC Rcd 7496 (2008) (``AWS-1 and 
Broadband PCS Procedures Public Notice'').
---------------------------------------------------------------------------

    69. Advanced Wireless Services. In 2006, the Commission conducted 
its first auction of Advanced Wireless Services licenses in the 1710-
1755 MHz and 2110-2155 MHz bands (``AWS-1''), designated as Auction 
66.\130\ The Commission defined ``small business'' as an entity with 
attributed average annual gross revenues that exceeded $15 million and 
did not exceed $40 million for the preceding three years.\131\ A small 
business received a 15 percent discount on its winning bid.\132\ A 
``very small business'' is defined as an entity with attributed average 
annual gross revenues that did not exceed $15 million for the preceding 
three years.\133\ A very small business received a 25 percent discount 
on its winning bid.\134\ In Auction 66, thirty-one winning bidders 
identified themselves as very small businesses and won 142 
licenses.\135\ Twenty-six of the winning bidders identified themselves 
as small businesses and won 73 licenses.\136\ In 2008, the Commission 
conducted an auction of AWS-1 licenses, designated as Auction 78, which 
offered 35 licenses for which there were no winning bids in Auction 
66.\137\ Four winning bidders that identified themselves as very small 
businesses won 17 AWS-1 licenses.\138\ Three of the winning bidders 
that identified themselves as a small business won five AWS-1 licenses.
---------------------------------------------------------------------------

    \130\ See Auction of Advanced Wireless Services Licenses 
Scheduled for June 29, 2006; Notice and Filing Requirements, Minimum 
Opening Bids, Upfront Payments and Other Procedures for Auction No. 
66, AU Docket No. 06-30, Public Notice, 21 FCC Rcd 4562 (2006) 
(``Auction 66 Procedures Public Notice'');
    \131\ 47 CFR 27.1102(a)(1).
    \132\ See 47 CFR 1.2110(f)(2).
    \133\ 47 CFR 27.1102(a)(2)
    \134\ See 47 CFR 1.2110(f)(2).
    \135\ See Auction of Advanced Wireless Services Licenses Closes; 
Winning Bidders Announced for Auction No. 66, Public Notice, 21 FCC 
Rcd 10,521 (2006) (``Auction 66 Closing Public Notice'')
    \136\ See id.
    \137\ See AWS-1 and Broadband PCS Procedures Public Notice, 23 
FCC Rcd 7496. Auction 78 also included an auction of Broadband PCS 
licenses.
    \138\ See ``Auction of AWS-1 and Broadband PCS Licenses Closes, 
Winning Bidders Announced for Auction 78, Down Payments Due 
September 9, 2008, FCC Forms 601 and 602 Due September 9, 2008, 
Final Payments Due September 23, 2008, Ten-Day Petition to Deny 
Period'', Public Notice, 23 FCC Rcd 12749-65 (2008).
---------------------------------------------------------------------------

    70. Narrowband Personal Communications Services. In 1994, the 
Commission conducted an auction for Narrowband PCS licenses. A second 
auction was also conducted later in 1994. For purposes of the first two 
Narrowband PCS auctions, ``small businesses'' were entities with 
average gross revenues for the prior three calendar years of $40 
million or less.\139\ Through these auctions, the Commission awarded a 
total of 41 licenses, 11 of which were obtained by four small 
businesses.\140\ To ensure meaningful participation by small business 
entities in future auctions, the Commission adopted a two-tiered small 
business size standard in the Narrowband PCS Second Report and 
Order.\141\ 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.\142\ 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.\143\ The SBA has approved 
these small business size standards.\144\ A third auction was conducted 
in 2001. Here, five bidders won 317 (Metropolitan Trading Areas and 
nationwide) licenses.\145\ Three of these claimed status as a small or 
very small entity and won 311 licenses.
---------------------------------------------------------------------------

    \139\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding Narrowband PCS, Third Memorandum Opinion 
and Order and Further Notice of Proposed Rulemaking, 10 FCC Rcd 175, 
196, para. 46 (1994).
    \140\ See ``Announcing the High Bidders in the Auction of ten 
Nationwide Narrowband PCS Licenses, Winning Bids Total 
$617,006,674,'' Public Notice, PNWL 94-004 (released Aug. 2, 1994); 
``Announcing the High Bidders in the Auction of 30 Regional 
Narrowband PCS Licenses; Winning Bids Total $490,901,787,'' Public 
Notice, PNWL 94-27 (released Nov. 9, 1994).
    \141\ Amendment of the Commission's Rules to Establish New 
Personal Communications Services, Narrowband PCS, Second Report and 
Order and Second Further Notice of Proposed Rule Making, 15 FCC Rcd 
10456, 10476, para. 40 (2000) (``Narrowband PCS Second Report and 
Order'').
    \142\ Narrowband PCS Second Report and Order, 15 FCC Rcd at 
10476, para. 40.
    \143\ Id.
    \144\ See Alvarez Letter 1998.
    \145\ See ``Narrowband PCS Auction Closes,'' Public Notice, 16 
FCC Rcd 18663 (WTB 2001).
---------------------------------------------------------------------------

    71. 700 MHz Band Licenses. The Commission previously adopted 
criteria for defining three groups of small businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits.\146\ The Commission defined a ``small business'' as an entity 
that, together with its affiliates and controlling principals, has 
average gross revenues not exceeding $40 million for the preceding 
three years.\147\ A ``very small business'' is defined as 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.\148\ Additionally, the lower 700 MHz Service had 
a third category of small business status for Metropolitan/Rural 
Service Area (``MSA/RSA'') licenses. The third category is 
``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.\149\ The 
SBA approved these small size standards.\150\ The Commission conducted 
an auction in 2002 of 740 licenses (one license in each of the 734 
MSAs/RSAs and one license in each of

[[Page 30628]]

the six Economic Area Groupings (EAGs)). 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.\151\ The 
Commission conducted a second auction in 2003 that included 256 
licenses: 5 EAG licenses and 476 Cellular Market Area licenses.\152\ 
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.\153\ In 2005, the Commission completed an 
auction of 5 licenses in the lower 700 MHz band (Auction 60). There 
were three winning bidders for five licenses. All three winning bidders 
claimed small business status.
---------------------------------------------------------------------------

    \146\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022 (2002) (``Channels 52-59 Report and Order'').
    \147\ See Channels 52-59 Report and Order, 17 FCC Rcd at 1087-
88, para. 172.
    \148\ See id.
    \149\ See id, 17 FCC Rcd at 1088, para. 173.
    \150\ See Letter from Aida Alvarez, Administrator, SBA, to 
Thomas Sugrue, Chief, WTB, FCC (Aug. 10, 1999) (``Alvarez Letter 
1999'').
    \151\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
17 FCC Rcd 17272 (WTB 2002).
    \152\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
18 FCC Rcd 11873 (WTB 2003).
    \153\ See id.
---------------------------------------------------------------------------

    72. In 2007, the Commission adopted the 700 MHz Second Report and 
Order.\154\ The Order revised the band plan for the commercial 
(including Guard Band) and public safety spectrum, adopted services 
rules, including stringent build-out requirements, an open platform 
requirement on the C Block, and a requirement on the D Block licensee 
to construct and operate a nationwide, interoperable wireless broadband 
network for public safety users. In 2008, the Commission conducted 
Auction 73 which offered all available, commercial 700 MHz Band 
licenses (1,099 licenses) for bidding using the Commission's standard 
simultaneous multiple-round (``SMR'') auction format for the A, B, D, 
and E block licenses and an SMR auction design with hierarchical 
package bidding (``HPB'') for the C Block licenses. A bidder with 
attributed average annual gross revenues that did not exceed $15 
million for the preceding three years (very small business) qualified 
for a 25 percent discount on its winning bids. A bidder with attributed 
average annual gross revenues that exceeded $15 million, but did not 
exceed $40 million for the preceding three years, qualified for a 15 
percent discount on its winning bids. At the conclusion of Auction 73, 
there were 36 winning bidders (who won 330 of the 1,090 licenses won) 
that identified themselves as very small businesses.\155\ There were 20 
winning bidders that identified themselves as a small business that won 
49 of the 1,090 licenses won.\156\ The provisionally winning bids for 
the A, B, C, and E Block licenses exceeded the aggregate reserve prices 
for those blocks. However, the provisionally winning bid for the D 
Block license did not meet the applicable reserve price and thus did 
not become a winning bid.\157\
---------------------------------------------------------------------------

    \154\ Service Rules for the 698-746, 747-762 and 777-792 MHz 
Band, WT Docket No. 06-150, Revision of the Commission's Rules to 
Ensure Compatibility with Enhanced 911 Emergency Calling Systems, CC 
Docket No. 94-102, Section 68.4(a) of the Commission's Rules 
Governing Hearing Aid-Compatible Telephone, WT Docket No. 01-309, 
Biennial Regulatory Review--Amendment of Parts 1, 22, 24, 27, and 90 
to Streamline and Harmonize Various Rules Affecting Wireless Radio 
Services, WT Docket No. 03-264, Former Nextel Communications, Inc. 
Upper 700 MHz Guard Band Licenses and Revisions to Part 27 of the 
Commission's Rules, WT Docket No. 06-169, Implementing a Nationwide, 
Broadband Interoperable Public Safety Network in the 700 MHz Band, 
PS Docket No. 06-229, Development of Operational, Technical and 
Spectrum Requirements for Meeting Federal, State, and Local Public 
Safety Communications Requirements Through the Year 2010, WT Docket 
No. 96-86, Second Report and Order, FCC 07-132 (2007) (``700 MHz 
Second Report and Order''), 22 FCC Rcd 15289 (2007).
    \155\ See Auction of 700 MHz Band Licenses Closes, Winning 
Bidders Announced for Auction 73, Down Payments Due April 3, 2008, 
FCC Forms 601 and 602 April 3, 2008, Final Payment Due April 17, 
2008, Ten-Day Petition to Deny Period, Public Notice, 23 FCC Rcd 
4572 (2008).
    \156\ Id. 23 FCC Rcd at 4572-73.
    \157\ Id.
---------------------------------------------------------------------------

    73. 700 MHz Guard Band Licenses. 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.\158\ 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.\159\ 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.\160\ SBA approval of these definitions is not 
required.\161\ In 2000, the Commission conducted an auction of 52 Major 
Economic Area (``MEA'') licenses.\162\ 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 eight 
700 MHz Guard Band licenses commenced and closed in 2001. Of the three 
winning bidders, one was a small business that won two of the eight 
licenses.\163\
---------------------------------------------------------------------------

    \158\ See Service Rules for the 746-764 MHz Bands, and Revisions 
to Part 27 of the Commission's Rules, Second Report and Order, 15 
FCC Rcd 5299 (2000) (``746-764 MHz Band Second Report and Order'').
    \159\ See 746-764 MHz Band Second Report and Order, 15 FCC Rcd 
at 5343, para. 108.
    \160\ See id.
    \161\ See id., 15 FCC Rcd 5299, 5343, para. 108 n.246 (for the 
746-764 MHz and 776-794 MHz bands, the Commission is exempt from 15 
U.S.C. Sec.  632, which requires Federal agencies to obtain SBA 
approval before adopting small business size standards).
    \162\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 15 FCC Rcd 18026 (2000).
    \163\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 16 FCC Rcd 4590 (WTB 2001).
---------------------------------------------------------------------------

    74. Specialized Mobile Radio. 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.\164\ 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.\165\ The SBA has 
approved these small business size standards for the 800 MHz and 900 
MHz SMR Service.\166\ 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.\167\ 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.\168\
---------------------------------------------------------------------------

    \164\ 47 CFR 90.810, 90.814(b), 90.912.
    \165\ 47 CFR 90.810, 90.814(b), 90.912.
    \166\ See Alvarez Letter 1999.
    \167\ See ``Correction to Public Notice DA 96-586 `FCC Announces 
Winning Bidders in the Auction of 1020 Licenses to Provide 900 MHz 
SMR in Major Trading Areas,''' Public Notice, 18 FCC Rcd 18367 (WTB 
1996).
    \168\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    75. 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.\169\ In an auction completed in

[[Page 30629]]

2000, a total of 2,800 Economic Area licenses in the lower 80 channels 
of the 800 MHz SMR service were awarded.\170\ 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.
---------------------------------------------------------------------------

    \169\ See ``800 MHz Specialized Mobile Radio (SMR) Service 
General Category (851-854 MHz) and Upper Band (861-865 MHz) Auction 
Closes; Winning Bidders Announced,'' Public Notice, 15 FCC Rcd 17162 
(2000).
    \170\ See, ``800 MHz SMR Service Lower 80 Channels Auction 
Closes; Winning Bidders Announced,'' Public Notice, 16 FCC Rcd 1736 
(2000).
---------------------------------------------------------------------------

    76. 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 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 1500 or fewer 
employees.\171\ 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.
---------------------------------------------------------------------------

    \171\ See generally 13 CFR 121.201, NAICS code 517210.
---------------------------------------------------------------------------

    77. 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 
definition of small entities specifically applicable to such incumbent 
220 MHz Phase I licensees. To estimate the number of such licensees 
that are small businesses, we apply the small business size standard 
under the SBA rules applicable to Wireless Telecommunications Carriers 
(except Satellite).\172\ This category provides that a small business 
is a wireless company employing no more than 1,500 persons.\173\ The 
Commission estimates that most such licensees are small businesses 
under the SBA's small business standard.
---------------------------------------------------------------------------

    \172\ Id.
    \173\ Id.
---------------------------------------------------------------------------

    78. 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 
licenses are assigned by auction, where mutually exclusive applications 
are accepted. In the 220 MHz Third Report and Order, the Commission 
adopted a small business size standard for defining ``small'' and 
``very small'' businesses for purposes of determining their eligibility 
for special provisions such as bidding credits and installment 
payments.\174\ This small business 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.\175\ A ``very small business'' 
is defined as 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.\176\ The SBA has approved 
these small size standards.\177\ A small business is eligible for a 25 
percent discount on its winning bid. A very small business is eligible 
for a 35 percent discount on its winning bid. The first auction of 
Phase II licenses was conducted in 1998.\178\ In the first auction, 908 
licenses were offered 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.\179\ Thirty-nine small businesses won 373 
licenses in the first 220 MHz auction. A second auction in 1999 
included 225 licenses: 216 EA licenses and 9 EAG licenses. Fourteen 
companies claiming small business status won 158 licenses.\180\ A third 
auction included four licenses: 2 BEA licenses and 2 EAG licenses in 
the 220 MHz Service. No small or very small business won any of these 
licenses.\181\ In 2007, the Commission conducted a fourth auction of 
the 220 MHz licenses, designated as Auction 72.\182\ Auction 72 offered 
94 Phase II 220 MHz Service licenses.\183\ In this auction, five 
winning bidders won a total of 76 licenses.\184\ Two winning bidders 
identified themselves as very small businesses won 56 of the 76 
licenses. One of the winning bidders that identified itself as a small 
business won 5 of the 76 licenses won.
---------------------------------------------------------------------------

    \174\ Amendment of Part 90 of the Commission's Rules to Provide 
For the Use of the 220-222 MHz Band by the Private Land Mobile Radio 
Service, Third Report and Order, 12 FCC Rcd 10943, 11068-70, paras. 
291-295 (1997).
    \175\ Id. at 11068, para. 291.
    \176\ Id.
    \177\ See Letter from Aida Alvarez, Administrator, SBA, to 
Daniel Phythyon, Chief, WTB, FCC (Jan. 6, 1998) (``Alvarez to 
Phythyon Letter 1998'').
    \178\ See generally ``220 MHz Service Auction Closes,'' Public 
Notice, 14 FCC Rcd 605 (1998).
    \179\ See ``FCC Announces It is Prepared to Grant 654 Phase II 
220 MHz Licenses After Final Payment is Made,'' Public Notice, 14 
FCC Rcd 1085 (1999).
    \180\ See ``Phase II 220 MHz Service Spectrum Auction Closes,'' 
Public Notice, 14 FCC Rcd 11218 (1999).
    \181\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (2002).
    \182\ See ``Auction of Phase II 220 MHz Service Spectrum 
Scheduled for June 20, 2007, Notice and Filing Requirements, Minimum 
Opening Bids, Upfront Payments and Other Procedures for Auction 
72,'' Public Notice, 22 FCC Rcd 3404 (2007).
    \183\ Id.
    \184\ See ``Auction of Phase II 220 MHz Service Spectrum 
Licenses Closes, Winning Bidders Announced for Auction 72, Down 
Payments due July 18, 2007, FCC Forms 601 and 602 due July 18, 2007, 
Final Payments due August 1, 2007, Ten-Day Petition to Deny 
Period,'' Public Notice, 22 FCC Rcd 11573 (2007).
---------------------------------------------------------------------------

    79. Cellular Radiotelephone Service. Auction 77 was held to resolve 
one group of mutually exclusive applications for Cellular 
Radiotelephone Service licenses for unserved areas in New Mexico.\185\ 
Bidding credits for designated entities were not available in Auction 
77.\186\ In 2008, the Commission completed the closed auction of one 
unserved service area in the Cellular Radiotelephone Service, 
designated as Auction 77. Auction 77 concluded with one provisionally 
winning bid for the unserved area totaling $25,002.\187\
---------------------------------------------------------------------------

    \185\ See Closed Auction of Licenses for Cellular Unserved 
Service Area Scheduled for June 17, 2008, Notice and Filing 
Requirements, Minimum Opening Bids, Upfront Payments, and Other 
Procedures for Auction 77, Public Notice, 23 FCC Rcd 6670 (2008).
    \186\ Id. at 6685.
    \187\ See Auction of Cellular Unserved Service Area License 
Closes, Winning Bidder Announced for Auction 77, Down Payment due 
July 2, 2008, Final Payment due July 17, 2008, Public Notice, 23 FCC 
Rcd 9501 (2008).
---------------------------------------------------------------------------

    80. Private Land Mobile Radio (``PLMR''). PLMR systems serve an 
essential role in a range of industrial, business, land transportation, 
and public safety activities. These radios are used by companies of all 
sizes operating in all U.S. business categories, and are often used in 
support of the licensee's primary (non-telecommunications) business 
operations. For the purpose of determining whether a licensee of a PLMR 
system is a small business as defined by the SBA, we use the broad 
census category, Wireless Telecommunications Carriers (except 
Satellite). This definition provides that a small entity is any such 
entity employing no more than 1,500 persons.\188\ The Commission does 
not require PLMR licensees to disclose information about number of 
employees, so the Commission does not have information that could be 
used to determine how many PLMR licensees constitute small entities 
under this definition. We note that PLMR licensees generally use the 
licensed facilities in support of other business activities, and 
therefore, it would also be helpful to

[[Page 30630]]

assess PLMR licensees under the standards applied to the particular 
industry subsector to which the licensee belongs.\189\
---------------------------------------------------------------------------

    \188\ See 13 CFR 121.201, NAICS code 517210.
    \189\ See generally 13 CFR 121.201.
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    81. As of March 2010, there were 424,162 PLMR licensees operating 
921,909 transmitters in the PLMR bands below 512 MHz. We note that any 
entity engaged in a commercial activity is eligible to hold a PLMR 
license, and that any revised rules in this context could therefore 
potentially impact small entities covering a great variety of 
industries.
    82. Fixed Microwave Services. Fixed microwave services include 
common carrier,\190\ private operational-fixed,\191\ and broadcast 
auxiliary radio services.\192\ At present, there are approximately 
22,015 common carrier fixed licensees and 61,670 private operational-
fixed licensees and broadcast auxiliary radio licensees in the 
microwave services. The Commission has not created a size standard for 
a small business specifically with respect to fixed microwave services. 
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.\193\ 
The Commission does not have data specifying the number of these 
licensees that have no more than 1,500 employees, and thus are unable 
at this time to estimate with greater precision the number of fixed 
microwave service licensees that would qualify as small business 
concerns under the SBA's small business size standard. Consequently, 
the Commission estimates that there are 22,015 or fewer common carrier 
fixed licensees and 61,670 or fewer private operational-fixed licensees 
and broadcast auxiliary radio licensees in the microwave services that 
may be small and may be affected by the rules and policies proposed 
herein. We note, however, that the common carrier microwave fixed 
licensee category includes some large entities.
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    \190\ See 47 CFR 101 et seq. for common carrier fixed microwave 
services (except Multipoint Distribution Service).
    \191\ Persons eligible under parts 80 and 90 of the Commission's 
Rules can use Private Operational-Fixed Microwave services. See 47 
CFR Parts 80 and 90. Stations in this service are called 
operational-fixed to distinguish them from common carrier and public 
fixed stations. Only the licensee may use the operational-fixed 
station, and only for communications related to the licensee's 
commercial, industrial, or safety operations.
    \192\ Auxiliary Microwave Service is governed by Part 74 of 
Title 47 of the Commission's Rules. See 47 CFR Part 74. This service 
is available to licensees of broadcast stations and to broadcast and 
cable network entities. Broadcast auxiliary microwave stations are 
used for relaying broadcast television signals from the studio to 
the transmitter, or between two points such as a main studio and an 
auxiliary studio. The service also includes mobile television 
pickups, which relay signals from a remote location back to the 
studio.
    \193\ 13 CFR 121.201, NAICS code 517210.
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    83. 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.\194\ 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.\195\ 
The SBA has approved these small business size standards.\196\ The 
auction of the 2,173, 39 GHz licenses was conducted in 2000. The 18 
bidders who claimed small business status won 849 licenses.
---------------------------------------------------------------------------

    \194\ See Amendment of the Commission's Rules Regarding the 
37.0-38.6 GHz and 38.6-40.0 GHz Bands, ET Docket No. 95-183, Report 
and Order, 12 FCC Rcd 18600 (1997).
    \195\ Id.
    \196\ See Letter from Aida Alvarez, Administrator, SBA, to 
Kathleen O'Brien Ham, Chief, Auctions and Industry Analysis 
Division, WTB, FCC (Feb. 4, 1998); see Letter from Hector Barreto, 
Administrator, SBA, to Margaret Wiener, Chief, Auctions and Industry 
Analysis Division, WTB, FCC (Jan. 18, 2002).
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    84. Local Multipoint Distribution Service. Local Multipoint 
Distribution Service (``LMDS'') is a fixed broadband point-to-
multipoint microwave service that provides for two-way video 
telecommunications.\197\ The auction of the 986 LMDS licenses began and 
closed in 1998. The Commission established a small business size 
standard for LMDS licenses as an entity that has average gross revenues 
of less than $40 million in the three previous calendar years.\198\ An 
additional small business size standard for ``very small business'' was 
added as an entity that, together with its affiliates, has average 
gross revenues of not more than $15 million for the preceding three 
calendar years.\199\ The SBA has approved these small business size 
standards in the context of LMDS auctions.\200\ There were 93 winning 
bidders that qualified as small entities in the LMDS auctions. A total 
of 93 small and very small business bidders won approximately 277 A 
Block licenses and 387 B Block licenses. In 1999, the Commission re-
auctioned 161 licenses; there were 32 small and very small businesses 
that won 119 licenses.
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    \197\ See Rulemaking to Amend Parts 1, 2, 21, 25, of the 
Commission's Rules to Redesignate the 27.5-29.5 GHz Frequency Band, 
Reallocate the 29.5-30.5 Frequency Band, to Establish Rules and 
Policies for Local Multipoint Distribution Service and for Fixed 
Satellite Services, Second Report and Order, Order on 
Reconsideration, and Fifth Notice of Proposed Rule Making, 12 FCC 
Rcd 12545, 12689-90, para. 348 (1997) (``LMDS Second Report and 
Order'').
    \198\ See LMDS Second Report and Order, 12 FCC Rcd at 12689-90, 
para. 348.
    \199\ See id.
    \200\ See Alvarez to Phythyon Letter 1998.
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    85. 218-219 MHz Service. The first auction of 218-219 MHz 
(previously referred to as the Interactive and Video Data Service or 
IVDS) spectrum resulted in 178 entities winning licenses for 594 
Metropolitan Statistical Areas (``MSAs'').\201\ Of the 594 licenses, 
567 were won by 167 entities qualifying as a small business. For that 
auction, the Commission defined a small business as 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.\202\ In the 218-219 MHz Report and Order and Memorandum 
Opinion and Order, we defined 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 exceeding $15 million for the preceding three 
years.\203\ 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 exceeding $3 million for the preceding three 
years.\204\ The SBA has approved of these definitions.\205\
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    \201\ See ``Interactive Video and Data Service (IVDS) 
Applications Accepted for Filing,'' Public Notice, 9 FCC Rcd 6227 
(1994).
    \202\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding, Fourth Report and Order, 9 FCC Rcd 2330 
(1994).
    \203\ Amendment of Part 95 of the Commission's Rules to Provide 
Regulatory Flexibility in the 218-219 MHz Service, Report and Order 
and Memorandum Opinion and Order, 15 FCC Rcd 1497 (1999).
    \204\ Id.
    \205\ See Alvarez to Phythyon Letter 1998.
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    86. Location and Monitoring Service (``LMS''). Multilateration LMS 
systems use non-voice radio techniques to determine the location and 
status of mobile radio units. For purposes of auctioning LMS licenses, 
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 $15 
million.\206\ A ``very small business'' is defined as an entity that, 
together with controlling interests and affiliates, has average annual 
gross revenues for the

[[Page 30631]]

preceding three years not exceeding $3 million.\207\ These definitions 
have been approved by the SBA.\208\ An auction for LMS licenses was 
conducted in 1999. Of the 528 licenses auctioned, 289 licenses were 
sold to four small businesses.
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    \206\ Amendment of Part 90 of the Commission's Rules to Adopt 
Regulations for Automatic Vehicle Monitoring Systems, Second Report 
and Order, 13 FCC Rcd 15182, 15192, para. 20 (1998) (``Automatic 
Vehicle Monitoring Systems Second Report and Order''); see also 47 
CFR 90.1103.
    \207\ Automatic Vehicle Monitoring Systems Second Report and 
Order, 13 FCC Rcd at 15192, para. 20; see also 47 CFR 90.1103.
    \208\ See Alvarez Letter 1998.
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    87. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service.\209\ A significant subset of the Rural Radiotelephone Service 
is the Basic Exchange Telephone Radio System (``BETRS'').\210\ In the 
present context, we will use 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.\211\ There are 
approximately 1,000 licensees in the Rural Radiotelephone Service, and 
the Commission estimates that there are 1,000 or fewer small entity 
licensees in the Rural Radiotelephone Service that may be affected by 
our action.
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    \209\ The service is defined in Section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \210\ BETRS is defined in Sections 22.757 and 22.759 of the 
Commission's rules, 47 CFR 22.757 and 22.759.
    \211\ 13 CFR 121.201, NAICS code 517210.
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    88. Air-Ground Radiotelephone Service.\212\ The Commission has 
previously used the SBA's small business definition applicable to 
Wireless Telecommunications Carriers (except Satellite), i.e., an 
entity employing no more than 1,500 persons.\213\ There are 
approximately 100 licensees in the Air-Ground Radiotelephone Service, 
and under that definition, we estimate 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.\214\ 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.\215\ These definitions were approved by the SBA.\216\ In 2006, 
the Commission completed an auction of nationwide commercial Air-Ground 
Radiotelephone Service licenses in the 800 MHz band (Auction 65). The 
auction closed with two winning bidders winning two Air-Ground 
Radiotelephone Services licenses. Neither of the winning bidders 
claimed small business status.
---------------------------------------------------------------------------

    \212\ The service is defined in Section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \213\ 13 CFR 121.201, NAICS codes 517210.
    \214\ Amendment of Part 22 of the Commission's Rules to Benefit 
the Consumers of Air-Ground Telecommunications Services, Biennial 
Regulatory Review--Amendment of Parts 1, 22, and 90 of the 
Commission's Rules, Amendment of Parts 1 and 22 of the Commission's 
Rules to Adopt Competitive Bidding Rules for Commercial and General 
Aviation Air-Ground Radiotelephone Service, WT Docket Nos. 03-103 
and 05-42, Order on Reconsideration and Report and Order, 20 FCC Rcd 
19663, paras. 28-42 (2005).
    \215\ Id.
    \216\ See Letter from Hector V. Barreto, Administrator, SBA, to 
Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access 
Division, WTB, FCC (Sept. 19, 2005).
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    89. Aviation and Marine Radio Services. There are approximately 
26,162 aviation, 34,555 marine (ship), and 3,296 marine (coast) 
licensees.\217\ The Commission has not developed a small business size 
standard specifically applicable to all licensees. For purposes of this 
analysis, we will use the SBA small business size standard for the 
category Wireless Telecommunications Carriers (except Satellite), which 
is 1,500 or fewer employees.\218\ We are unable to determine how many 
of those licensed fall under this standard. For purposes of our 
evaluations in this analysis, we estimate that there are up to 
approximately 62,969 licensees that are small businesses under the SBA 
standard.\219\ In 1998, the Commission held an auction of 42 VHF Public 
Coast licenses in the 157.1875-157.4500 MHz (ship transmit) and 
161.775-162.0125 MHz (coast transmit) bands. For this auction, the 
Commission defined a ``small'' business as an entity that, together 
with controlling interests and affiliates, has average gross revenues 
for the preceding three years not to exceed $15 million dollars. In 
addition, a ``very small'' business is one that, together with 
controlling interests and affiliates, has average gross revenues for 
the preceding three years not to exceed $3 million dollars.\220\ 
Further, the Commission made available Automated Maritime 
Telecommunications System (``AMTS'') licenses in Auctions 57 and 
61.\221\ Winning bidders could claim status as a very small business or 
a very small business. A very small business for this service is 
defined as an entity with attributed average annual gross revenues that 
do not exceed $3 million for the preceding three years, and a small 
business is defined as an entity with attributed average annual gross 
revenues of more than $3 million but less than $15 million for the 
preceding three years.\222\ Three of the winning bidders in Auction 57 
qualified as small or very small businesses, while three winning 
entities in Auction 61 qualified as very small businesses.
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    \217\ Vessels that are not required by law to carry a radio and 
do not make international voyages or communications are not required 
to obtain an individual license. See Amendment of Parts 80 and 87 of 
the Commission's Rules to Permit Operation of Certain Domestic Ship 
and Aircraft Radio Stations Without Individual Licenses, Report and 
Order, WT Docket No. 96-82, 11 FCC Rcd 14849 (1996).
    \218\ 13 CFR 121.201, NAICS code 517210.
    \219\ A licensee may have a license in more than one category.
    \220\ Amendment of the Commission's Rules Concerning Maritime 
Communications, PR Docket No. 92-257, Third Report and Order and 
Memorandum Opinion and Order, 13 FCC Rcd 19853 (1998).
    \221\ See ``Automated Maritime Telecommunications System 
Spectrum Auction Scheduled for September 15, 2004, Notice and Filing 
Requirements, Minimum Opening Bids, Upfront Payments and Other 
Auction Procedures,'' Public Notice, 19 FCC Rcd 9518 (WTB 2004); 
``Auction of Automated Maritime Telecommunications System Licenses 
Scheduled for August 3, 2005, Notice and Filing Requirements, 
Minimum Opening Bids, Upfront Payments and Other Auction Procedures 
for Auction No. 61,'' Public Notice, 20 FCC Rcd 7811 (WTB 2005).
    \222\ 47 CFR 80.1252.
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    90. Offshore Radiotelephone Service. This service operates on 
several ultra high frequencies (``UHF'') television broadcast channels 
that are not used for television broadcasting in the coastal areas of 
states bordering the Gulf of Mexico.\223\ There is presently 1 licensee 
in this service. We do not have information whether that licensee would 
qualify as small under the SBA's small business size standard for 
Wireless Telecommunications Carriers (except Satellite) services.\224\ 
Under that SBA small business size standard, a business is small if it 
has 1,500 or fewer employees.\225\
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    \223\ This service is governed by Subpart I of Part 22 of the 
Commission's rules. See 47 CFR 22.1001-22.1037.
    \224\ 13 CFR 121.201, NAICS code 517210.
    \225\ Id.
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    91. Multiple Address Systems (``MAS''). Entities using MAS 
spectrum, in general, fall into two categories: (1) Those using the 
spectrum for profit-based uses, and (2) those using the spectrum for 
private internal uses. The Commission defines a small business for MAS 
licenses as an entity that has average gross revenues of less than $15 
million in the three previous calendar years.\226\ A very small 
business is defined as an entity that, together with its affiliates, 
has average gross revenues of not more than $3 million for the 
preceding three calendar years.\227\ The

[[Page 30632]]

SBA has approved these definitions.\228\ The majority of these entities 
will most likely be licensed in bands where the Commission has 
implemented a geographic area licensing approach that would require the 
use of competitive bidding procedures to resolve mutually exclusive 
applications. The Commission's licensing database indicates that, as of 
March 5, 2010, there were over 11,500 MAS station authorizations. In 
addition, an auction for 5,104 MAS licenses in 176 EAs was conducted in 
2001.\229\ Seven winning bidders claimed status as small or very small 
businesses and won 611 licenses. In 2005, the Commission completed an 
auction (Auction 59) of 4,226 MAS licenses in the Fixed Microwave 
Services from the 928/959 and 932/941 MHz bands. Twenty-six winning 
bidders won a total of 2,323 licenses. Of the 26 winning bidders in 
this auction, five claimed small business status and won 1,891 
licenses.
---------------------------------------------------------------------------

    \226\ See Amendment of the Commission's Rules Regarding Multiple 
Address Systems, Report and Order, 15 FCC Rcd 11956, 12008, para. 
123 (2000).
    \227\ Id.
    \228\ See Alvarez Letter 1999.
    \229\ See ``Multiple Address Systems Spectrum Auction Closes,'' 
Public Notice, 16 FCC Rcd 21011 (2001).
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    92. With respect to entities that use, or seek to use, MAS spectrum 
to accommodate internal communications needs, we note that MAS serves 
an essential role in a range of industrial, safety, business, and land 
transportation activities. MAS radios are used by companies of all 
sizes, operating in virtually all U.S. business categories, and by all 
types of public safety entities. For the majority of private internal 
users, the small business size standard developed by the SBA would be 
more appropriate. The applicable size standard in this instance appears 
to be that of Wireless Telecommunications Carriers (except Satellite). 
This definition provides that a small entity is any such entity 
employing no more than 1,500 persons.\230\ The Commission's licensing 
database indicates that, as of January 20, 1999, of the 8,670 total MAS 
station authorizations, 8,410 authorizations were for private radio 
service, and of these, 1,433 were for private land mobile radio 
service.
---------------------------------------------------------------------------

    \230\ See 13 CFR 121.201, NAICS code 517210.
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    93. 1.4 GHz Band Licensees. The Commission conducted an auction of 
64 1.4 GHz band licenses \231\ in 2007.\232\ In that auction, the 
Commission defined ``small business'' as an entity that, together with 
its affiliates and controlling interests, had average gross revenues 
that exceed $15 million but do not exceed $40 million for the preceding 
three years, and a ``very small business'' as an entity that, together 
with its affiliates and controlling interests, has had average annual 
gross revenues not exceeding $15 million for the preceding three 
years.\233\ Neither of the two winning bidders sought designated entity 
status.\234\
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    \231\ See ``Auction of 1.4 GHz Bands Licenses Scheduled for 
February 7, 2007,'' Public Notice, 21 FCC Rcd 12393 (WTB 2006).
    \232\ See ``Auction of 1.4 GHz Band Licenses Closes; Winning 
Bidders Announced for Auction No. 69,'' Public Notice, 22 FCC Rcd 
4714 (2007) (``Auction No. 69 Closing PN'').
    \233\ Auction No. 69 Closing PN, Attachment C.
    \234\ See Auction No. 69 Closing PN.
---------------------------------------------------------------------------

    94. Incumbent 24 GHz 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. The 
applicable SBA small business size standard is that of Wireless 
Telecommunications Carriers (except Satellite). This category provides 
that such a company is small if it employs no more than 1,500 
persons.\235\ The broader census data notwithstanding, we believe that 
there are only two licensees in the 24 GHz band that were relocated 
from the 18 GHz band, Teligent\236\ and TRW, Inc. It is our 
understanding that Teligent and its related companies have fewer than 
1,500 employees, though this may change in the future. TRW is not a 
small entity. There are approximately 122 licensees in the Rural 
Radiotelephone Service, and the Commission estimates that there are 122 
or fewer small entity licensees in the Rural Radiotelephone Service 
that may be affected by our action.
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    \235\ 13 CFR 121.201, NAICS code 517210.
    \236\ Teligent acquired the DEMS licenses of FirstMark, the only 
licensee other than TRW in the 24 GHz band whose license has been 
modified to require relocation to the 24 GHz band.
---------------------------------------------------------------------------

    95. Future 24 GHz Licensees. With respect to new applicants in the 
24 GHz band, we have defined ``small business'' as an entity that, 
together with controlling interests and affiliates, has average annual 
gross revenues for the three preceding years not exceeding $15 
million.\237\ ``Very small business'' in the 24 GHz band is defined as 
an entity that, together with controlling interests and affiliates, has 
average gross revenues not exceeding $3 million for the preceding three 
years.\238\ The SBA has approved these definitions.\239\ In a 2004 
auction of 24 GHz licenses, three winning bidders won seven licenses. 
Two of the winning bidders were very small businesses that won five 
licenses.
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    \237\ Amendments to Parts 1, 2, 87 and 101 of the Commission's 
Rules To License Fixed Services at 24 GHz, Report and Order, 15 FCC 
Rcd 16934, 16967, para. 77 (2000) (``24 GHz Report and Order''); see 
also 47 CFR 101.538(a)(2).
    \238\ 24 GHz Report and Order, 15 FCC Rcd at 16967, para. 77; 
see also 47 CFR 101.538(a)(1).
    \239\ See Letter from Gary M. Jackson, Assistant Administrator, 
SBA, to Margaret W. Wiener, Deputy Chief, Auctions and Industry 
Analysis Division, WTB, FCC (July 28, 2000).
---------------------------------------------------------------------------

    96. 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'')).\240\ 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.\241\ 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.\242\ 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. The Commission has adopted three levels of 
bidding credits for BRS: (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

[[Page 30633]]

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.\243\ In 2009, the 
Commission conducted Auction 86, which offered 78 BRS licenses.\244\ 
Auction 86 concluded with the sale of 61 licenses.\245\ Of the ten 
winning bidders, three bidders that claimed small business status won 7 
licenses, and two bidders that claimed entrepreneur status won six 
licenses.
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    \240\ Amendment of Parts 21 and 74 of the Commission's Rules 
with Regard to Filing Procedures in the Multipoint Distribution 
Service and in the Instructional Television Fixed Service and 
Implementation of Section 309(j) of the Communications Act--
Competitive Bidding, MM Docket No. 94-131 and PP Docket No. 93-253, 
Report and Order, 10 FCC Rcd 9589, 9593, para. 7 (1995) (``MDS 
Auction R&O'').
    \241\ 47 CFR 21.961(b)(1).
    \242\ 47 U.S.C. 309(j). Hundreds of stations were licensed to 
incumbent MDS licensees prior to implementation of Section 309(j) of 
the Communications Act of 1934, 47 U.S.C. 309(j). For these pre-
auction licenses, the applicable standard is SBA's small business 
size standard.
    \243\ Id. at 8296.
    \244\ Auction of Broadband Radio Service (BRS) Licenses, 
Scheduled for October 27, 2009, Notice and Filing Requirements, 
Minimum Opening Bids, Upfront Payments, and Other Procedures for 
Auction 86, Public Notice, 24 FCC Rcd 8277 (2009).
    \245\ Auction of Broadband Radio Service Licenses Closes, 
Winning Bidders Announced for Auction 86, Down Payments Due November 
23, 2009, Final Payments Due December 8, 2009, Ten-Day Petition to 
Deny Period, Public Notice, 24 FCC Rcd 13572 (2009).
---------------------------------------------------------------------------

    97. 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.\246\ 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.'' \247\ 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 
these cable services we must, however, use current census data that are 
based on the previous category of Cable and Other Program Distribution 
and its associated size standard; that size standard was: all such 
firms having $13.5 million or less in annual receipts.\248\ According 
to Census Bureau data for 2002, there were a total of 1,191 firms in 
this previous category that operated for the entire year.\249\ Of this 
total, 1,087 firms had annual receipts of under $10 million, and 43 
firms had receipts of $10 million or more but less than $25 
million.\250\ Thus, the majority of these firms can be considered 
small.
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    \246\ The term ``small entity'' within SBREFA applies to small 
organizations (nonprofits) and to small governmental jurisdictions 
(cities, counties, towns, townships, villages, school districts, and 
special districts with populations of less than 50,000). 5 U.S.C. 
601(4)-(6). We do not collect annual revenue data on EBS licensees.
    \247\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \248\ 13 CFR 121.201, NAICS code 517110.
    \249\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \250\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    98. Television Broadcasting. This Economic Census category 
``comprises establishments primarily engaged in broadcasting images 
together with sound. These establishments operate television 
broadcasting studios and facilities for the programming and 
transmission of programs to the public.'' \251\ The SBA has created the 
following small business size standard for Television Broadcasting 
firms: those having $14 million or less in annual receipts.\252\ The 
Commission has estimated the number of licensed commercial television 
stations to be 1,392.\253\ In addition, according to Commission staff 
review of the BIA Publications, Inc., Master Access Television Analyzer 
Database (BIA) on March 30, 2007, about 986 of an estimated 1,395 
commercial television stations (or approximately 72 percent) had 
revenues of $13 million or less.\254\ We therefore estimate that the 
majority of commercial television broadcasters are small entities.
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    \251\ U.S. Census Bureau, 2007 NAICS Definitions, ``515120 
Television Broadcasting'' (partial definition); http://www.census.gov/naics/2007/def/ND515120.HTM#N515120.
    \252\ 13 CFR 121.201, NAICS code 515120 (updated for inflation 
in 2008).
    \253\ See FCC News Release, ``Broadcast Station Totals as of 
September 30, 2010,'' dated October 22, 2010; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
    \254\ We recognize that BIA's estimate differs slightly from the 
FCC total given supra.
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    99. We note, however, that in assessing whether a business concern 
qualifies as small under the above definition, business (control) 
affiliations \255\ must be included. Our estimate, therefore, likely 
overstates the number of small entities that might be affected by our 
action, because the revenue figure on which it is based does not 
include or aggregate revenues from affiliated companies. In addition, 
an element of the definition of ``small business'' is that the entity 
not be dominant in its field of operation. We are unable at this time 
to define or quantify the criteria that would establish whether a 
specific television station is dominant in its field of operation. 
Accordingly, the estimate of small businesses to which rules may apply 
does not exclude any television station from the definition of a small 
business on this basis and is therefore possibly over-inclusive to that 
extent.
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    \255\ ``[Business concerns] are affiliates of each other when 
one concern controls or has the power to control the other or a 
third party or parties controls or has the power to control both.'' 
13 CFR 21.103(a)(1).
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    100. In addition, the Commission has estimated the number of 
licensed noncommercial educational (NCE) television stations to be 
391.\256\ These stations are non-profit, and therefore considered to be 
small entities.\257\
---------------------------------------------------------------------------

    \256\ See FCC News Release, ``Broadcast Station Totals as of 
September 30, 2010,'' dated October 22, 2010; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
    \257\ See generally 5 U.S.C. 601(4), (6).
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    101. In addition, there are also 2,387 low power television 
stations (LPTV).\258\ Given the nature of this service, we will presume 
that all LPTV licensees qualify as small entities under the above SBA 
small business size standard.
---------------------------------------------------------------------------

    \258\ See FCC News Release, ``Broadcast Station Totals as of 
September 30, 2010,'' dated October 22, 2010; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
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    102. Radio Broadcasting. This Economic Census category ``comprises 
establishments primarily engaged in broadcasting aural programs by 
radio to the public. Programming may originate in their own studio, 
from an affiliated network, or from external sources.''\259\ The SBA 
has established a small business size standard for this category, which 
is: such firms having $7 million or less in annual receipts.\260\ 
According to Commission staff review of BIA Publications, Inc.'s Master 
Access Radio Analyzer Database on March 31, 2005, about 10,840 (95%) of 
11,410 commercial radio stations had revenues of $6 million or less. 
Therefore, the majority of such entities are small entities.
---------------------------------------------------------------------------

    \259\ U.S. Census Bureau, 2007 NAICS Definitions, ``515112 Radio 
Stations''; http://www.census.gov/naics/2007/def/ND515112.HTM#N515112.
    \260\ 13 CFR 121.201, NAICS code 515112 (updated for inflation 
in 2008).
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    103. We note, however, that in assessing whether a business concern 
qualifies as small under the above size standard, business affiliations 
must be included.\261\ In addition, to be

[[Page 30634]]

determined to be a ``small business,'' the entity may not be dominant 
in its field of operation.\262\ We note that it is difficult at times 
to assess these criteria in the context of media entities, and our 
estimate of small businesses may therefore be over-inclusive.
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    \261\ ``Concerns and entities are affiliates of each other when 
one controls or has the power to control the other, or a third party 
or parties controls or has the power to control both. It does not 
matter whether control is exercised, so long as the power to control 
exists.'' 13 CFR 121.103(a)(1) (an SBA regulation).
    \262\ 13 CFR 121.102(b) (an SBA regulation).
---------------------------------------------------------------------------

    104. Auxiliary, Special Broadcast and Other Program Distribution 
Services. This service involves a variety of transmitters, generally 
used to relay broadcast programming to the public (through translator 
and booster stations) or within the program distribution chain (from a 
remote news gathering unit back to the station). The Commission has not 
developed a definition of small entities applicable to broadcast 
auxiliary licensees. The applicable definitions of small entities are 
those, noted previously, under the SBA rules applicable to radio 
broadcasting stations and television broadcasting stations.\263\
---------------------------------------------------------------------------

    \263\ 13 CFR 121.201, NAICS codes 515112 and 515120.
---------------------------------------------------------------------------

    105. The Commission estimates that there are approximately 5,618 FM 
translators and boosters.\264\ The Commission does not collect 
financial information on any broadcast facility, and the Department of 
Commerce does not collect financial information on these auxiliary 
broadcast facilities. We believe that most, if not all, of these 
auxiliary facilities could be classified as small businesses by 
themselves. We also recognize that most commercial translators and 
boosters are owned by a parent station which, in some cases, would be 
covered by the revenue definition of small business entity discussed 
above. These stations would likely have annual revenues that exceed the 
SBA maximum to be designated as a small business ($7.0 million for a 
radio station or $14.0 million for a TV station). Furthermore, they do 
not meet the Small Business Act's definition of a ``small business 
concern'' because they are not independently owned and operated. \265\
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    \264\ See supra note 242.
    \265\ See 15 U.S.C. 632.
---------------------------------------------------------------------------

    106. Cable Television Distribution Services. 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.'' \266\ 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 these cable 
services we must, however, use current census data that are based on 
the previous category of Cable and Other Program Distribution and its 
associated size standard; that size standard was: all such firms having 
$13.5 million or less in annual receipts.\267\ According to Census 
Bureau data for 2002, there were a total of 1,191 firms in this 
previous category that operated for the entire year.\268\ Of this 
total, 1,087 firms had annual receipts of under $10 million, and 43 
firms had receipts of $10 million or more but less than $25 
million.\269\ Thus, the majority of these firms can be considered 
small.
---------------------------------------------------------------------------

    \266\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \267\ 13 CFR 121.201, NAICS code 517110.
    \268\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \269\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    107. 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.\270\ Industry 
data indicate that, of 1,076 cable operators nationwide, all but eleven 
are small under this size standard.\271\ In addition, under the 
Commission's rules, a ``small system'' is a cable system serving 15,000 
or fewer subscribers.\272\ Industry data indicate that, of 6,635 
systems nationwide, 5,802 systems have under 10,000 subscribers, and an 
additional 302 systems have 10,000-19,999 subscribers.\273\ Thus, under 
this second size standard, most cable systems are small.
---------------------------------------------------------------------------

    \270\ 47 CFR 76.901(e). The Commission determined that this size 
standard equates approximately to a size standard of $100 million or 
less in annual revenues. Implementation of Sections of the 1992 
Cable Act: Rate Regulation, Sixth Report and Order and Eleventh 
Order on Reconsideration, 10 FCC Rcd 7393, 7408 (1995).
    \271\ These data are derived from: R.R. Bowker, Broadcasting & 
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8 
& C-2 (data current as of June 30, 2005); Warren Communications 
News, Television & Cable Factbook 2006, ``Ownership of Cable Systems 
in the United States,'' pages D-1805 to D-1857.
    \272\ 47 CFR 76.901(c).
    \273\ Warren Communications News, Television & Cable Factbook 
2008, ``U.S. Cable Systems by Subscriber Size,'' page F-2 (data 
current as of Oct. 2007). The data do not include 851 systems for 
which classifying data were not available.
---------------------------------------------------------------------------

    108. 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.'' \274\ 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.\275\ Industry data indicate that, of 1,076 cable operators 
nationwide, all but ten are small under this size standard.\276\ 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,\277\ and therefore we are unable 
to estimate more accurately the number of cable system operators that 
would qualify as small under this size standard.
---------------------------------------------------------------------------

    \274\ 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn. 1-3.
    \275\ 47 CFR 76.901(f); see Public Notice, FCC Announces New 
Subscriber Count for the Definition of Small Cable Operator, DA 01-
158 (Cable Services Bureau, Jan. 24, 2001).
    \276\ These data are derived from: R.R. Bowker, Broadcasting & 
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8 
& C-2 (data current as of June 30, 2005); Warren Communications 
News, Television & Cable Factbook 2006, ``Ownership of Cable Systems 
in the United States,'' pages D-1805 to D-1857.
    \277\ The Commission does receive such information on a case-by-
case basis if a cable operator appeals a local franchise authority's 
finding that the operator does not qualify as a small cable operator 
pursuant to Section 76.901(f) of the Commission's rules. See 47 CFR 
76.909(b).
---------------------------------------------------------------------------

    109. Open Video Systems. 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.\278\ The OVS framework provides opportunities for 
the distribution of video programming other than through cable systems. 
Because OVS operators provide subscription services,\279\ OVS falls 
within the SBA small business size standard covering cable services, 
which

[[Page 30635]]

is ``Wired Telecommunications Carriers.'' \280\ 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 such services we must, however, use current census data 
that are based on the previous category of Cable and Other Program 
Distribution and its associated size standard; that size standard was: 
all such firms having $13.5 million or less in annual receipts.\281\ 
According to Census Bureau data for 2002, there were a total of 1,191 
firms in this previous category that operated for the entire year.\282\ 
Of this total, 1,087 firms had annual receipts of under $10 million, 
and 43 firms had receipts of $10 million or more but less than $25 
million.\283\ Thus, the majority of cable firms can be considered 
small. In addition, we note that the Commission has certified some OVS 
operators, with some now providing service.\284\ Broadband service 
providers (``BSPs'') are currently the only significant holders of OVS 
certifications or local OVS franchises.\285\ 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, again, at least some of the OVS operators may qualify as small 
entities.
---------------------------------------------------------------------------

    \278\ 47 U.S.C. 571(a)(3)-(4). See Annual Assessment of the 
Status of Competition in the Market for the Delivery of Video 
Programming, Thirteenth Annual Report, 24 FCC Rcd 542, 606 para. 135 
(2009) (``Thirteenth Annual Cable Competition Report'').
    \279\ See 47 U.S.C. 573.
    \280\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers''; http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \281\ 13 CFR 121.201, NAICS code 517110.
    \282\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \283\ Id. An additional 61 firms had annual receipts of $25 
million or more.
    \284\ A list of OVS certifications may be found at http://www.fcc.gov/mb/ovs/csovscer.html.
    \285\ See Thirteenth Annual Cable Competition Report, 24 FCC Rcd 
at 606-07 para. 135. BSPs are newer firms that are building state-
of-the-art, facilities-based networks to provide video, voice, and 
data services over a single network.
---------------------------------------------------------------------------

    110. Cable Television Relay Service. This service includes 
transmitters generally used to relay cable programming within cable 
television system distribution systems. This cable service is 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.'' \286\ 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 cable services 
we must, however, use current census data that are based on the 
previous category of Cable and Other Program Distribution and its 
associated size standard; that size standard was: All such firms having 
$13.5 million or less in annual receipts.\287\ According to Census 
Bureau data for 2002, there were a total of 1,191 firms in this 
previous category that operated for the entire year.\288\ Of this 
total, 1,087 firms had annual receipts of under $10 million, and 43 
firms had receipts of $10 million or more but less than $25 
million.\289\ Thus, the majority of these firms can be considered 
small.
---------------------------------------------------------------------------

    \286\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \287\ 13 CFR 121.201, NAICS code 517110.
    \288\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \289\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    111. Multichannel Video Distribution and Data Service. MVDDS is a 
terrestrial fixed microwave service operating in the 12.2-12.7 GHz 
band. The Commission adopted criteria for defining three groups of 
small businesses for purposes of determining their eligibility for 
special provisions such as bidding credits. It defined a very small 
business as an entity with average annual gross revenues not exceeding 
$3 million for the preceding three years; a small business as an entity 
with average annual gross revenues not exceeding $15 million for the 
preceding three years; and an entrepreneur as an entity with average 
annual gross revenues not exceeding $40 million for the preceding three 
years.\290\ These definitions were approved by the SBA.\291\ On January 
27, 2004, the Commission completed an auction of 214 MVDDS licenses 
(Auction No. 53). In this auction, ten winning bidders won a total of 
192 MVDDS licenses.\292\ Eight of the ten winning bidders claimed small 
business status and won 144 of the licenses. The Commission also held 
an auction of MVDDS licenses on December 7, 2005 (Auction 63). Of the 
three winning bidders who won 22 licenses, two winning bidders, winning 
21 of the licenses, claimed small business status.\293\
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    \290\ Amendment of Parts 2 and 25 of the Commission's Rules to 
Permit Operation of NGSO FSS Systems Co-Frequency with GSO and 
Terrestrial Systems in the Ku-Band Frequency Range; Amendment of the 
Commission's Rules to Authorize Subsidiary Terrestrial Use of the 
12.2-12.7 GHz Band by Direct Broadcast Satellite Licenses and their 
Affiliates; and Applications of Broadwave USA, PDC Broadband 
Corporation, and Satellite Receivers, Ltd. to provide A Fixed 
Service in the 12.2-12.7 GHz Band, ET Docket No. 98-206, Memorandum 
Opinion and Order and Second Report and Order, 17 FCC Rcd 9614, 
9711, para. 252 (2002).
    \291\ See Letter from Hector V. Barreto, Administrator, U.S. 
Small Business Administration, to Margaret W. Wiener, Chief, 
Auctions and Industry Analysis Division, WTB, FCC (Feb. 13, 2002).
    \292\ See ``Multichannel Video Distribution and Data Service 
Auction Closes,'' Public Notice, 19 FCC Rcd 1834 (2004).
    \293\ See ``Auction of Multichannel Video Distribution and Data 
Service Licenses Closes; Winning Bidders Announced for Auction No. 
63,'' Public Notice, 20 FCC Rcd 19807 (2005).
---------------------------------------------------------------------------

    112. Amateur Radio Service. These licensees are held by individuals 
in a noncommercial capacity; these licensees are not small entities.
    113. Aviation and Marine 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.\294\ Most applicants for 
recreational licenses are individuals. Approximately 581,000 ship 
station licensees and 131,000 aircraft station licensees operate 
domestically and are not subject to the radio carriage requirements of 
any statute or treaty. For purposes of our evaluations in this 
analysis, we estimate that there are up to approximately 712,000 
licensees that are small businesses (or individuals) under the SBA 
standard. In addition, between December 3, 1998 and December 14, 1998, 
the Commission held an auction of 42 VHF Public Coast licenses in the 
157.1875-157.4500 MHz (ship transmit) and 161.775-162.0125 MHz (coast 
transmit) bands. For purposes of the auction, the Commission defined a 
``small'' business as an entity that, together with controlling 
interests and affiliates, has average gross revenues for the preceding 
three years not to exceed $15 million dollars. In addition, a ``very 
small'' business is one that, together with controlling interests and 
affiliates, has average gross revenues for the preceding three years 
not to exceed $3

[[Page 30636]]

million dollars.\295\ There are approximately 10,672 licensees in the 
Marine Coast Service, and the Commission estimates that almost all of 
them qualify as ``small'' businesses under the above special small 
business size standards.
---------------------------------------------------------------------------

    \294\ 13 CFR 121.201, NAICS code 517210.
    \295\ Amendment of the Commission's Rules Concerning Maritime 
Communications, Third Report and Order and Memorandum Opinion and 
Order, 13 FCC Rcd 19853 (1998).
---------------------------------------------------------------------------

    114. Personal Radio Services. Personal radio services provide 
short-range, low power radio for personal communications, radio 
signaling, and business communications not provided for in other 
services. The Personal Radio Services include spectrum licensed under 
Part 95 of our rules.\296\ These services include Citizen Band Radio 
Service (``CB''), General Mobile Radio Service (``GMRS''), Radio 
Control Radio Service (``R/C''), Family Radio Service (``FRS''), 
Wireless Medical Telemetry Service (``WMTS''), Medical Implant 
Communications Service (``MICS''), Low Power Radio Service (``LPRS''), 
and Multi-Use Radio Service (``MURS'').\297\ There are a variety of 
methods used to license the spectrum in these rule parts, from 
licensing by rule, to conditioning operation on successful completion 
of a required test, to site-based licensing, to geographic area 
licensing. Under the RFA, the Commission is required to make a 
determination of which small entities are directly affected by the 
rules being proposed. Since all such entities are wireless, we apply 
the definition of Wireless Telecommunications Carriers (except 
Satellite), pursuant to which a small entity is defined as employing 
1,500 or fewer persons.\298\ Many of the licensees in these services 
are individuals, and thus are not small entities. In addition, due to 
the mostly unlicensed and shared nature of the spectrum utilized in 
many of these services, the Commission lacks direct information upon 
which to base an estimation of the number of small entities under an 
SBA definition that might be directly affected by our action.
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    \296\ 47 CFR Part 90.
    \297\ The Citizens Band Radio Service, General Mobile Radio 
Service, Radio Control Radio Service, Family Radio Service, Wireless 
Medical Telemetry Service, Medical Implant Communications Service, 
Low Power Radio Service, and Multi-Use Radio Service are governed by 
Subpart D, Subpart A, Subpart C, Subpart B, Subpart H, Subpart I, 
Subpart G, and Subpart J, respectively, of Part 95 of the 
Commission's rules. See generally 47 CFR Part 95.
    \298\ 13 CFR 121.201, NAICS Code 517210.
---------------------------------------------------------------------------

    115. Public Safety Radio Services. Public Safety radio services 
include police, fire, local government, forestry conservation, highway 
maintenance, and emergency medical services.\299\ There are a total of 
approximately 127,540 licensees in these services. Governmental 
entities\300\ as well as private businesses comprise the licensees for 
these services. All governmental entities with populations of less than 
50,000 fall within the definition of a small entity.\301\
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    \299\ With the exception of the special emergency service, these 
services are governed by Subpart B of part 90 of the Commission's 
rules, 47 CFR 90.15-90.27. The police service includes approximately 
27,000 licensees that serve state, county, and municipal enforcement 
through telephony (voice), telegraphy (code) and teletype and 
facsimile (printed material). The fire radio service includes 
approximately 23,000 licensees comprised of private volunteer or 
professional fire companies as well as units under governmental 
control. The local government service that is presently comprised of 
approximately 41,000 licensees that are state, county, or municipal 
entities that use the radio for official purposes not covered by 
other public safety services. There are approximately 7,000 
licensees within the forestry service which is comprised of 
licensees from state departments of conservation and private forest 
organizations who set up communications networks among fire lookout 
towers and ground crews. The approximately 9,000 state and local 
governments are licensed to highway maintenance service provide 
emergency and routine communications to aid other public safety 
services to keep main roads safe for vehicular traffic. The 
approximately 1,000 licensees in the Emergency Medical Radio Service 
(``EMRS'') use the 39 channels allocated to this service for 
emergency medical service communications related to the delivery of 
emergency medical treatment. 47 CFR 90.15-90.27. The approximately 
20,000 licensees in the special emergency service include medical 
services, rescue organizations, veterinarians, handicapped persons, 
disaster relief organizations, school buses, beach patrols, 
establishments in isolated areas, communications standby facilities, 
and emergency repair of public communications facilities. 47 CFR 
90.33-90.55.
    \300\ 47 CFR 1.1162.
    \301\ 5 U.S.C. 601(5).
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    116. 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 connections 
(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,\302\ which has an SBA small business 
size standard of 1,500 or fewer employees.\303\ The latter are within 
the category of All Other Telecommunications,\304\ which has a size 
standard of annual receipts of $25 million or less.\305\ The most 
current Census Bureau data for all such firms, however, are the 2002 
data for the previous census category called Internet Service 
Providers.\306\ That category had a small business size standard of $21 
million or less in annual receipts, which was revised in late 2005 to 
$23 million. The 2002 data show that there were 2,529 such firms that 
operated for the entire year.\307\ Of those, 2,437 firms had annual 
receipts of under $10 million, and an additional 47 firms had receipts 
of between $10 million and $24,999,999.\308\ Consequently, we estimate 
that the majority of ISP firms are small entities.
---------------------------------------------------------------------------

    \302\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'', http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \303\ 13 CFR 121.201, NAICS code 517110 (updated for inflation 
in 2008).
    \304\ U.S. Census Bureau, 2007 NAICS Definitions, ``517919 All 
Other Telecommunications''; http://www.census.gov/naics/2007/def/ND517919.HTM#N517919.
    \305\ 13 CFR 121.201, NAICS code 517919 (updated for inflation 
in 2008).
    \306\ U.S. Census Bureau, ``2002 NAICS Definitions, ``518111 
Internet Service Providers''; http://www.census.gov/eped/naics02/def/NDEF518.HTM.
    \307\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 518111 (issued Nov. 2005).
    \308\ An additional 45 firms had receipts of $25 million or 
more.
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    117. The ISP industry has changed dramatically since 2002. The 2002 
data cited above may therefore include entities that no longer provide 
Internet access service and may exclude entities that now provide such 
service. To ensure that this (IRFA/FRFA) describes the universe of 
small entities that our action might affect, we discuss in turn several 
different types of entities that might be providing Internet access 
service.
    118. We note that, although we have no specific information on the 
number of small entities that provide Internet access service over 
unlicensed spectrum, we include these entities in our IRFA/FRFA.

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

    119. With certain exceptions, the Commission's Schedule of 
Regulatory Fees applies to all Commission licensees and regulatees. 
Most licensees will be required to count the number of licenses or call 
signs authorized, and pay a regulatory fee based on the number of 
licenses or call signs.\309\ In

[[Page 30637]]

some instances, licensees may decide to submit an FCC Form 159 
Remittance Advice. Interstate telephone service providers must compute 
their annual regulatory fee based on their interstate and international 
end-user revenue using information they already supply to the 
Commission in compliance with the Form 499-A, Telecommunications 
Reporting Worksheet. Compliance with the fee schedule will require some 
licensees to tabulate the number of units (e.g., cellular telephones, 
pagers, cable TV subscribers) they have in service. Licensees 
ordinarily will keep a list of the number of units they have in service 
as part of their normal business practices. No additional outside 
professional skills are required to submit a regulatory fee payment, 
and it can be completed by the employees responsible for an entity's 
business records.
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    \309\ See 47 CFR 1.1162 for the general exemptions from 
regulatory fees. E.g., Amateur radio licensees (except applicants 
for vanity call signs) and operators in other non-licensed services 
(e.g., Personal Radio, part 15, ship and aircraft). Governments and 
non-profit (exempt under section 501(c) of the Internal Revenue 
Code) entities are exempt from payment of regulatory fees and need 
not submit payment. Non-commercial educational broadcast licensees 
are exempt from regulatory fees as are licensees of auxiliary 
broadcast services such as low power auxiliary stations, television 
auxiliary service stations, remote pickup stations and aural 
broadcast auxiliary stations where such licenses are used in 
conjunction with commonly owned non-commercial educational stations. 
Emergency Alert System licenses for auxiliary service facilities are 
also exempt as are instructional television fixed service licensees. 
Regulatory fees are automatically waived for the licensee of any 
translator station that: (1) Is not licensed to, in whole or in 
part, and does not have common ownership with, the licensee of a 
commercial broadcast station; (2) does not derive income from 
advertising; and (3) is dependent on subscriptions or contributions 
from members of the community served for support. Receive only earth 
station permittees are exempt from payment of regulatory fees. A 
regulatee will be relieved of its fee payment requirement if its 
total fee due, including all categories of fees for which payment is 
due by the entity, amounts to less than $10.
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    120. As discussed previously in this Notice of Proposed Rulemaking, 
the Commission concluded in its FY 2009 regulatory fee cycle that 
licensees filing their annual regulatory fee payments must begin the 
process by entering the Commission's Fee Filer system with a valid FRN 
and password. In some instances, it will be necessary to use a specific 
FRN and password that is linked to a particular regulatory fee bill. 
Going forward, the submission of hardcopy Form 159 documents will not 
be permitted for making a regulatory fee payment during the regulatory 
fee cycle. By requiring licensees to use Fee Filer to begin the 
regulatory fee payment process, errors resulting from illegible 
handwriting on hardcopy Form 159's will be reduced, and the Commission 
will be able to create an electronic record of licensee payment 
attributes that are more easily traceable than payments that were 
previously mailed in with a hardcopy Form 159.
    121. Licensees and regulatees are advised that failure to submit 
the required regulatory fee in a timely manner will subject the 
licensee or regulatee to a late payment penalty of 25 percent in 
addition to the required fee.\310\ If payment is not received, new or 
pending applications may be dismissed, and existing authorizations may 
be subject to rescission.\311\ Further, in accordance with the DCIA, 
Federal agencies may bar a person or entity from obtaining a Federal 
loan or loan insurance guarantee if that person or entity fails to pay 
a delinquent debt owed to any Federal agency.\312\ Nonpayment of 
regulatory fees is a debt owed to the United States pursuant to 31 
U.S.C. 3711 et seq., and the DCIA. Appropriate enforcement measures, as 
well as administrative and judicial remedies, may be exercised by the 
Commission. Debts owed to the Commission may result in a person or 
entity being denied a Federal loan or loan guarantee pending before 
another Federal agency until such obligations are paid.\313\
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    \310\ 47 CFR 1.1164.
    \311\ 47 CFR 1.1164(c).
    \312\ Public Law 104-134, 110 Stat. 1321 (1996).
    \313\ 31 U.S.C. 7701(c)(2)(B).
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    122. The Commission's rules currently provide for relief in 
exceptional circumstances. Persons or entities may request a waiver, 
reduction or deferment of payment of the regulatory fee.\314\ However, 
timely submission of the required regulatory fee must accompany 
requests for waivers or reductions. This will avoid any late payment 
penalty if the request is denied. The fee will be refunded if the 
request is granted. In exceptional and compelling instances (e.g. where 
payment of the regulatory fee along with the waiver or reduction 
request could result in reduction of service to a community or other 
financial hardship to the licensee), the Commission will defer payment 
in response to a request filed with the appropriate supporting 
documentation.
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    \314\ 47 CFR 1.1166.
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E. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    123. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching 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 or reporting requirements under the rule for 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 small 
entities.\315\ In our NPRM, we sought comment on alternatives that 
might simplify our fee procedures or otherwise benefit filers, 
including small entities, while remaining consistent with our statutory 
responsibilities in this proceeding. We received no comments 
specifically in response to the IRFA.
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    \315\ 5 U.S.C. 603.
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    124. Several categories of licensees and regulatees are exempt from 
payment of regulatory fees. Also, waiver procedures provide regulatees, 
including small entity regulatees, relief in exceptional circumstances. 
We note that small entities should be assisted by our implementation of 
the Fee Filer program, and that we have continued our practice of 
exempting fees whose total sum owed is less than $10.00.

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

    125. None.

V. Ordering Clauses

    126. Accordingly, it is ordered that, pursuant to Sections 4(i) and 
(j), 9, and 303(r) of the Communications Act of 1934, as amended, 47 
U.S.C. 154(i), 154(j), 159, and 303(r), this NPRM is hereby adopted.
    127. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this NPRM including the Initial Regulatory Flexibility Analysis 
in Appendix E, to the Chief Counsel for Advocacy of the U.S. Small 
Business Administration.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 2011-12685 Filed 5-25-11; 8:45 am]
BILLING CODE 6712-01-P