BloostonLaw Telecom Update
Published by the Law Offices of Blooston, Mordkofsky, Dickens, Duffy & Prendergast, LLP
[Selected portions reproduced here with the firm's permission.]
| Vol. 11, No. 1|| January 9, 2008 |
CPNI Annual Certification Is Due March 1
Although the rules do not specify when carriers should modify and complete their “Annual Certification of CPNI Compliance” for 2007, we recommend that you do so as soon as possible. The certification must be filed with the FCC by March 1.
Note that the annual certification should include the following three required Exhibits:
(a) A Statement Explaining How The Company’s Operating Procedures Ensure Compliance With The FCC’S CPNI Rules to reflect the Company’s policies and information;
(b) A Statement of Actions Taken Against Data Brokers; and
(c) A Summary of Customer Complaints Regarding Unauthorized Release of CPNI.
A company officer with personal knowledge that the company has established operating procedures adequate to ensure compliance with the rules must execute the Certification, place a copy of the Certification and accompanying Exhibits in the Company’s CPNI Compliance Records, and forward the original to BloostonLaw for filing with the FCC by March 1.
BloostonLaw is prepared to help our clients meet this requirement, which we expect will be strictly enforced, by assisting with preparation of their certification filing; reviewing the filing to make sure that the required showings are made; filing the certification with the FCC, and obtaining a proof-of-filing copy for your records.
Clients interested in obtaining our assistance should contact Gerry Duffy (202-828-5528) or Mary Sisak (202-828-5554).
Frontline Quits 700 MHz Auction; FCC Warns Bidders To Respect Confidentiality
Frontline Wireless has dropped out of the 700 MHz Auction (Auctions 73 and 76) after failing to secure financing to make its upfront payment. Frontline issued a brief statement to the New York Times and other media that it was “closed for business at this time.” Frontline had been a frontrunner for the D-Block “private/public safety network” license. Frontline’s departure adds to speculation about the fate of the anticipated nationwide network that could be used for commercial traffic, but would serve as an interoperability channel for public safety in emergencies.
In the meantime, the FCC’s Wireless Telecommunications Bureau (WTB) has issued a Public Notice to remind applicants for the upcoming auction of 700 MHz Band licenses of the confidential nature of certain information, such as an applicant’s upfront payment amount, license selection, bidding eligibility, actual bids submitted, bidding- related actions (e.g., bid withdrawals, proactive waivers submitted, reductions in eligibility) and other bidding- related information that may indicate the identity or interests of specific applicants. The WTB further reminds applicants that public disclosure of such confidential information may violate the Commission’s anti-collusion rule and subject the applicant to enforcement action, including but not limited to imposition of a monetary fine pursuant to Section 503 of the Communications Act.
The WTB adopted anonymous bidding procedures to withhold from public release until after the close of bidding in both Auctions 73 and 76 any information that may indicate specific applicants’ interests in the auction, including, in addition to the information described above, information on the winning bidders for licenses in blocks for which the reserve price was met in Auction 73. Correspondingly, the WTB recently warned applicants that the direct or indirect communication to other applicants or the public disclosure of such non-public information could violate the Commission’s anonymous bidding procedures and the anti-collusion rule. To the extent an applicant believes that such a disclosure is required by law or regulation, including regulations issued by the U.S. Securities and Exchange Commission, the WTB strongly urges that the applicant consult with the Commission before making such disclosure.
Frontline was founded by former FCC Chairman Reed Hundt and several Silicon Valley venture capitalists. Backers included John Doerr of Kleiner Perkins Caulfield & Byers and former Netscape CEO James Barksdale. Frontline’s CEO is Haynes Griffin, former chief executive of Vanguard Cellular.
Despite these connections, and a year spent lobbying to create a range of frequencies intended specifically for a combination of private service and public safety communications, Frontline failed in frenzied negotiations in recent weeks to find the financial backing it needed, according to the New York Times.
This development may signal lower auction prices than originally anticipated, although it is not clear how much this dynamic will trickle down to the smaller licenses. Of course, for any particular license, the price can be inflated or deflated by individual circumstances, such as a bidding war between two entrenched carriers with interests in the same license area.
BloostonLaw contacts: Hal Mordkofsky, John Prendergast, Cary Mitchell, and Bob Jackson.
Joint Board Staff Releases Latest Universal Service Monitoring Report Stats
The staff of the Federal-State Joint Board on Universal Service has released its most recent Monitoring Report on Universal Service. This report reflects information on the telephone industry filed with the FCC through June 2007, and it reflects data for the year 2006 and prior years. The report addresses the various universal service support mechanisms, which amounted to about $6.6 billion in 2006. In 2006, disbursements among the four categories of universal service mechanisms were: 61.8% for high-cost support; 25.2% for schools and libraries support; 12.4% for low-income support; and 0.6% for rural health care support. The report presents data in 11 categories:
Industry Revenues and Contributions – Total industry revenues for telecommunications services provided to end users in 2006 were about $236 billion, compared to about $235 billion in 2005. Revenues for fixed local service providers decreased to about $81 billion, from about $82 billion, while wireless service providers’ revenues increased to about $110 billion, from about $101 billion, and toll service providers’ revenues decreased to about $45 billion, from about $52 billion.
Low-Income Support – Total low-income support increased to about $808 million in 2006, from about $803 million in 2005.
High-Cost Support – In 2006, total high-cost support amounted to about $4.1 billion, an increase from about $3.8 billion in 2005. This increase is due to support to competitive carriers (CETCs) increasing from $0.6 billion in 2005 to $1.0 billion in 2006.
Schools and Libraries Support – Schools and libraries support disbursements in 2006 decreased to $1.7 billion from $1.9 billion in 2005.
Rural Health Care Support – The demand for rural health care support disbursements increased to $41 million in 2006 from $26 million in 2005.
Subscribership and Penetration – According to the Current Population Survey, the percentage of households subscribing to telephone service increased to an average of 93.6% in 2006, from 93.1% in 2005.
Rates and Price Indices – The price index of overall telephone rates increased 1.7% in 2006, compared to the general rate of inflation of 2.5% for all goods and services.
Network Usage – Interstate toll usage for customers of incumbent local exchange carriers declined to 379 billion minutes in 2006, from 401 billion minutes in 2005.
Quality of Service – The data show noticeable differences in the quality of service among carriers. For example, complaints per million residential access lines in 2006 ranged from 0 to 961 for different carriers.
Infrastructure – The total number of access lines in service for the mandatory price-cap carriers (the regional Bell operating companies) declined to about 118 million in 2006, from about 127 million in 2005. On the other hand, measures of their fiber transmission generally grew in 2006.
Revenues, Expenses and Investment – For the larger local exchange carriers in 2006, 56% percent of net income was interstate, 35% of revenues was interstate, and 32% of expenses was interstate.
A monitoring program was established in the mid-1980's, at the recommendation of the Separations Joint Board, to track trends related to universal service and related matters. Since then, Joint Board staffs have prepared Monitoring Reports at least once a year -- a compendium of hundreds of pages of statistical data on subscribership and penetration, loop costs, separations factors, universal service fund payments, etc. The report is unique in that it is the only document that includes information on every incumbent local telephone company in the nation. In 1998, the publication of this report was moved from the Separations Joint Board staff to the Universal Service Joint Board staff. This is the ninth Monitoring Report from the Universal Service Joint Board staff.
The FCC also released new data on local telephone service competition in the United States. Twice a year, all incumbent local exchange carriers (LECs) and competitive local exchange carriers (CLECs ) are required to report basic information about their local telephone service, and all facilities-based mobile telephony providers are required to provide information about their subscribers, pursuant to the FCC’s local telephone competition and broadband data gathering program (FCC Form 477). Statistics reflect data as of December 31, 2006.
- End-user customers obtained local telephone service by utilizing approximately 138.8 million incumbent LEC switched access lines, 28.7 million CLEC switched access lines, and 229.6 million mobile telephony service subscriptions at the end of December 2006.
- Of the 28.7 million CLEC end-user switched access lines, 6.8 million lines were provided over coaxial cable connections. The 6.8 million lines represent about 61% of the 11.2 million end-user switched access lines that CLECs reported providing over their own local loop facilities.
- Mobile telephony service providers reported 229.6 million subscribers at the end of December 2006, which is 26 million, or 13%, more than a year earlier. About 7% of these subscribers were billed by mobile telephony service resellers.
- There was at least one CLEC serving customers in 82% of the nation’s Zip Codes at the end of December 2006. About 98% of United States households resided in those Zip Codes. Moreover, multiple carriers reported providing local telephone service in the major population centers of the country.
- The 28.7 million lines reported by CLECs is about 17% of the 167.5 million total end-user switched access lines reported for the end of December 2006.
- CLECs reported 12.2 million (or 12%) of the 101.4 million lines that served residential end users and 16.4 million (or 25%) of the 66.1 million lines that served business, institutional, and government customers.
- CLECs reported providing 39% of their end-user switched access lines over their own local loop facilities, 41% by using unbundled network elements (UNEs) that they leased from other carriers, and 20% through resale arrangements with unaffiliated carriers.
- Incumbent LECs reported providing about 16% fewer UNE loops with switching (referred to as the UNE-Platform) to unaffiliated carriers at the
end of December 2006 than they reported six months earlier (7.1 million compared to 8.4 million) and about the same number of UNE loops without switching (4.4 million).
- Incumbent LECs were the pre-subscribed interstate long distance carrier for 58% of the switched access lines they provided to end users, while CLECs were the interstate long distance carrier for 76% of their switched access lines.
BloostonLaw contacts: Ben Dickens, Gerry Duffy, and Mary Sisak.
FCC Spells Out Rules, Dates For 2009 DTV Transition
The FCC has adopted an Report and Order in its third periodic review regarding the conversion to digital television (DTV) by February 17, 2009, that (1) provides a progress report on the transition; (2) describes the status and readiness of stations to complete their transition; (3) adopts procedures and rule changes necessary to ensure that broadcasters meet the statutory transition deadline and complete construction of their final, post-transition facilities while maintaining the best possible television service to their viewers; and (4) addresses other issues related to the transition. In the Report and Order, the FCC took the following actions to facilitate the completion of the transition for full-power television stations:
- It established February 17, 2009, as the construction deadline for stations building digital facilities based on a new channel allotment in the post-transition DTV Table of Allotments and stations that will be returning to their analog channel or moving to a new digital channel for post-transition operations. These stations will not be required to construct a digital facility on their pre-transition DTV channel and will be permitted to forgo further construction to the extent such a facility has been partially built.
- It established May 18, 2008, as the construction deadline for stations that will use their pre-transition DTV channel for post-transition operations and already have a construction permit that matches their post-transition facilities.
- It established August 18, 2008, as the construction deadline for stations that will use their pre-transition DTV channel for post-transition operations, but which do not have a construction permit that matches their post-transition facilities.
- It established February 17, 2009, as the construction deadline for stations demonstrating that a unique technical challenge, such as the need to reposition a side-mounted antenna, prevents them from completing construction of their final DTV facilities.
- It established stricter standards for granting extensions of time to construct digital facilities for all construction deadlines on or before February 17, 2009. In addition, for construction deadlines occurring February 18, 2009, or later, it will consider such requests under the tolling standard set forth in Section 73.3598(b) of the rules. It will adopt its revised FCC Form 337, as proposed.
- It adopted FCC Form 387 and required all full-power television stations to file it by February 18, 2008, detailing their current transition status, additional steps necessary for digital-only operation upon expiration of the February 17, 2009 transition deadline, and a timeline for making those steps. Stations must update the form as events warrant, and by October 20, 2008, if they have not completed construction.
- It will permit stations that are moving to a different DTV channel for post-transition operations to temporarily remain on their pre-transition DTV channel while they complete construction of their final digital facilities, provided: (1) They build facilities that serve at least the same population that receives their current analog TV and DTV service so that over-the-air viewers will not lose TV service; and (2) They do not cause impermissible interference to other stations or prevent other stations from making their transition.
- It will permit stations to operate their post-transition facilities, pursuant to special temporary authority (STA), at less than their full, authorized facilities, provided: (1) They demonstrate a unique technical challenge and they can serve at least 85 percent of the same population that receives their current analog TV and DTV service; or (2) A significant technical impediment to the construction of their full, authorized facilities that would not otherwise qualify for an extension of time to construct facilities under the new, stricter standard adopted herein and they serve at least 100 percent of the same population that receives their current analog TV and DTV service so that over-the-air viewers will not lose TV service. In addition, stations must demonstrate that they do not cause impermissible interference to other stations or prevent other stations from making their transition. Finally, stations that cannot serve at least 100 percent of the same population that receives their current analog TV and DTV service must comply with a viewer notification requirement.
- It clarified that, under existing rules, a station may temporarily reduce or cease service on their pre-transition analog or digital channel for a period of 30 days or less, upon notification to the Commission and without prior approval, when necessary to complete construction of the post-transition digital facility.
- It will provide stations with the flexibility to permanently reduce or terminate their analog or pre-transition digital service before the transition date, provided the station satisfies the following two requirements: (1) The station demonstrates that its service reduction or termination is directly related to the construction and operation of its, or another station’s, post-transition facilities; and (2) The station notifies viewers on its pre-transition channel(s) about the planned service reduction or termination and informs them about how they can continue to receive the station.
- To provide additional flexibility within 90 days of the February 17, 2009 transition date (i.e., beginning on or after November 19, 2008), the FCC will allow stations to permanently reduce or terminate their analog or pre-transition digital service without prior approval upon notification to the Commission 30 days prior to the planned permanent service reduction or termination. The station must still comply with a viewer notification requirement.
- It will permit stations that are moving to a different DTV channel for post-transition operations to cease operations on their pre-transition digital channels and begin operating on their new channels before the transition date, provided: (1) The early transitioning stations will not cause impermissible interference to another station; and (2) The early transitioning stations continue to serve their existing viewers for the remainder of the transition and commence their full, authorized post-transition operations upon expiration of the February 17, 2009 transition deadline.
- It announced its intent to lift the freeze on the filing of maximization applications on August 17, 2008, the date by which it expects to have completed processing stations’ applications to build their post-transition facilities. Until this date, the FCC will maintain its freeze and will not accept maximization applications to expand facilities.
- It adopted a waiver policy that will permit rapid approval of minor (i.e., not exceeding 5 miles) expansion applications filed by stations that will not use their pre-transition DTV channel for post-transition operation. This policy will allow added flexibility for stations that wish to use their existing analog channel antenna, which provides benefits for the successful completion of the transition by reducing the demands on equipment suppliers and installation crews during a critical time as the transition date nears.
The Commission also adopted several technical rules with respect to interference and station identification requirements.
In a separate statement, Commissioner Michael Copps said: “Pulling the switch on stations all across the land at one and the same time in February 2009 is going to be a real throw of the dice. It is unfathomable to me that we are planning to turn off every analog signal in the country on a single day without running at least one test market first. Other countries are transitioning over time, with phased schedules. The United Kingdom, for example, is transitioning between 2007 and 2012, region-by-region, learning at every step along the way and making the necessary adjustments. The UK recently transitioned the small town of Whitehaven as the first step in a multi-year transition plan; a few years ago, Germany took a similar step in Berlin.
“The lessons learned from those initial test markets doubtless will prove invaluable to those countries’ broader transition efforts. We need some of that real-world experience here. Why in the world aren't we doing that? I am encouraged that the Chairman and my colleagues are willing to sit down now and begin exploring the idea of one or more DTV demonstration projects around the country. I recognize there may be legal, technical, and practical challenges with planning and conducting such a test this close to the national transition date. But I believe it can be done. At least—for the sake of a successful DTV transition—let’s hope it can.”
BloostonLaw contacts: Hal Mordkofsky, Ben Dickens, Gerry Duffy, and John Prendergast.
FCC SETS COMMENT CYCLE FOR NPRM ON COMMERCIAL MOBILE ALERT SYSTEM: The FCC has established a comment cycle for its Notice of Proposed Rulemaking (NPRM) to establish a Commercial Mobile Alert System (CMAS). In particular, the Commission seeks comment on the recommendations of the Commercial Mobile Services Alert Advisory Committee (CMSAAC). The Commission convened the CMSAAC in compliance with the Warning Alert and Response Network (WARN) Act, which requires that the FCC adopt technical standards, protocols, procedures, and other technical requirements for the CMAS based on the recommendations of the CMSAAC. The purpose of this rulemaking is to create a mechanism under which CMS providers may elect to transmit emergency alerts to the public. The Commission has initiated this proceeding to comply with the WARN Act and to satisfy the Commission's mandate to promote the safety of life and property through the use of wire and radio communication (BloostonLaw Telecom Update, December 19, 2007). Comments in this PSHSB Docket No. 07-287 proceeding are due Feb. 4, and replies are due Feb. 19. Written comments on the Paperwork Reduction Act proposed information collection requirement must be submitted by the public, Office of Management and Budget (OMB), and other interested parties on or before March 3. BloostonLaw contacts: Hal Mordkofsky, John Prendergast, and Richard Rubino.
FEBRUARY 1: FCC FORM 502, NUMBER UTILIZATION AND FORECAST REPORT: Any wireless or wireline carrier (including paging companies) that have received number blocks--including 100, 1,000, or 10,000 number blocks--from the North American Numbering Plan Administrator (NANPA), a Pooling Administrator, or from another carrier, must file Form 502 by February 1. Carriers porting numbers for the purpose of transferring an established customer’s service to another service provider must also report, but the carrier receiving numbers through porting does not. Resold services should also be treated like ported numbers, meaning the carrier transferring the resold service to another carrier is required to report those numbers but the carrier receiving such numbers should not report them. New this year is that reporting carriers are required to include their FCC Registration Number (FRN). Reporting carriers file utilization and forecast reports semiannually on or before February 1 for the preceding six-month reporting period ending December 31, and on or before August 1 for the preceding six-month reporting period ending June 30. BloostonLaw contacts: Ben Dickens, Gerry Duffy, and Mary Sisak.