Selected portions of the BloostonLaw Telecom Update, and/or the BloostonLaw Private Users Update — newsletters from the Law Offices of Blooston, Mordkofsky, Dickens, Duffy & Prendergast, LLP — are reproduced in this section with the firm’s permission.
|BloostonLaw Telecom Update||Vol. 18, No. 39||October 7, 2015|
FCC Reminds Providers to File a Complete and Accurate Form 477 Every Six Months
The Enforcement Bureau has released a reminder that providers of voice and broadband Internet services must file timely, complete, and accurate FCC Form 477 reports twice each year, by March 1 (reporting data collected as of December 31 of the previous year), and September 1 (reporting data collected as of June 30 of the current year).
Please see the article in this week’s edition of the BloostonLaw Telecom Update for more information.
FCC Reminds Providers to File a Complete and Accurate Form 477 Every Six Months
The Enforcement Bureau has released a reminder that providers of voice and broadband Internet services must file timely, complete, and accurate FCC Form 477 reports twice each year, by March 1 (reporting data collected as of December 31 of the previous year), and September 1 (reporting data collected as of June 30 of the current year). According to the Bureau, the data reported on Form 477 "is used by the Commission to assess and promote nationwide broadband deployment, to appropriately target universal service funds, to ensure access to emergency communications in disaster scenarios, and to help meet other public service goals." In rural and underserved areas, data from providers is used to assess local competition and broadband availability.
The Bureau lists the following entities that are required to file Form 477:
- Common carriers and their affiliates providing telephone exchange or exchange access service;
- Facilities-based Commercial Mobile Radio Service (CMRS) providers offering mobile phone service;
- Interconnected Voice over Internet Protocol (VoIP) providers;
- Facilities-based broadband Internet service providers (including, but not limited to Wireless Internet Service Providers (WISPs)).
The Bureau reminds entities that Form 477 filing requirements apply to providers regardless of size.
The Bureau also states that it is prepared to take enforcement action against providers who violate this reporting requirement. The Bureau states that "Providers, including WISPs and other rural entities, are on notice that failure to timely file Form 477 reports may result in enforcement action, including monetary penalties."
FCC Form 477 must be submitted electronically through the FCC website. For additional information about Form 477, please contact the firm.
Associations Propose Processes for Implementing Model-Based Support for Rural Carriers
ITTA, NTCA, USTelecom and WTA (the Associations) filed an ex parte letter on October 2, 2015, proposing consensus recommendations for allocating Connect America Fund (CAF) reserve dollars for rate of return (ROR) carriers voluntarily electing the model-based plan for universal service support. (Docket No10-90) The ex parte letter can be found here. According to the Associations, the proposal would allocate reserve dollars based on: (a) the amount of model-based support received by each electing company; and (b) study areas with the lowest current build out percentages of 10/1 service. Companies with a current build-out percentage of greater than 85% would be precluded from receiving CAF reserve dollars in accordance with the Commission's objectives of directing funding to study areas with the lowest current build out percentages.
The ex parte letter also revised the proposed build-out milestones, including proposed non-compliance measures, for ROR carriers electing model-based support. Under the proposal, carriers would have no specific build-out milestone requirement during years 1-4 (although they would be expected to be extending and upgrading their networks during this time). At year 5, carriers would be required to have extended service to 50% of the additional locations they were required to serve as a condition of receiving model-based support. This milestone would increase 10 percentage points a year during each of the following years until it reached 100% of the required additional locations in Year 10.
CTIA and Wireless Industry Update Measures to Curb Smartphone Theft and Protect Personal Data
CTIA and a group of participating wireless carriers and device manufacturers last Friday announced an update to the Smartphone Anti-Theft Voluntary Commitment to encourage industry-wide adoption of anti-theft measures that will be made available on all smartphones by July of 2016. This latest effort to deter smartphone theft and protect personal data comes in response to a request from FCC Chairman Tom Wheeler to update the Commitment.
According to CTIA, the Commitment promotes the widest possible adoption of anti-theft tools while respecting the importance of consumer choice and privacy. In addition, the industry has developed a list of apps to locate, erase and/or lock, many of which are free, for the various operating systems, and a video with step-by-step video instructions on how to set up a PIN/password on various mobile devices. Clients with wireless operations may want to include links to these CTIA resources on their own web sites as a resource for their own customers.
“Today's announcement of the new Commitment is the latest example of how America's wireless industry takes on tough issues and works together to develop the best solutions for their customers that balances the needs of users while still providing the flexibility for companies to innovate,” said CTIA President and CEO Meredith Attwell Baker.
Terms of the voluntary Commitment are as follows:
Smartphone Anti-Theft Voluntary Commitment
Each device manufacturer and operating system signatory of Part I of this "Smartphone Anti-Theft Voluntary Commitment" agrees that:
- New models of smartphones first manufactured after July 2015 for retail sale in the United States will offer, at no cost to consumers, a baseline anti-theft tool that is preloaded or downloadable on wireless smartphones that provides the connected capability to:
- Remote wipe the authorized user's data (i.e., erase personal info that is added after purchase such as contacts, photos, e-mails, etc.) that is on the smartphone in the event it is lost or stolen.
- Render the smartphone inoperable to an unauthorized user (e.g., locking the smartphone so it cannot be used without a password or PIN), except in accordance with FCC rules for 911 emergency communications, and if available, emergency numbers programmed by the authorized user (e.g., “phone home”).
- Prevent reactivation without authorized user's permission (including unauthorized factory reset attempts) to the extent technologically feasible (e.g., locking the smartphone as in 2 above).
- Reverse the inoperability if the smartphone is recovered by the authorized user and restore user data on the smartphone to the extent feasible (e.g., restored from the cloud).
- In order to be effective, the anti-theft tools need to be widely adopted while still respecting the importance of consumer choices and privacy. New models of smartphones first manufactured after July 2016 for retail sale in the United States will, if technically necessary, make readily available to the authorized user an option that allows the authorized user to enable or disable the anti-theft solution at any time that the smartphone is connected and is in the authorized user's possession.
In addition to this baseline anti-theft tool, consumers may use other technological solutions, if available for their smartphones.
Each network operator signatory of Part II to the "Smartphone Anti-Theft Voluntary Commitment" commits to permit the availability and full usability of a baseline anti-theft tool to be preloaded or downloadable on smartphones as specified in this commitment.
These voluntary measures appear to be working since reports of smartphone thefts are on the decline in cities across the country. According to CTIA, there has been a more than 20 percent increase in PIN and password usage by consumers to proactively protect their personal information and their mobile devices in case of theft.
FCC Chairman Wheeler applauded the industry efforts in a written statement, and said the FCC would remain vigilant in this area by pushing for further improvements to the theft-prevention toolbox, and by monitoring closely whether the efforts of industry and others are producing meaningful results.
In related news, last week the FCC and the Ministry of Information and Technology of Columbia (a country that has become a hub for the stolen cell phone market) announced they had entered a Memorandum of Understanding aimed at curbing wireless device theft. The joint MOU states both the U.S. and Colombia will continue to work with mobile device and service providers to block activation of stolen devices and actively work to reduce theft of stolen devices.
The following network operators, device manufacturers and operating system companies are participating in the voluntary commitment: Apple Inc.; Assurant; Asurion; AT&T; BlackBerry; Google Inc.; HTC America Inc.; Huawei Device USA, Inc.; LGE Mobile Research U. S. A., LLC; Microsoft Corporation; Motorola Mobility LLC; Samsung Electronics America, Inc.; Sprint Corporation; T-Mobile USA; U.S. Cellular; Verizon and ZTE USA Inc.
Dish DEs Elect to “Selectively Default” on AWS-3 Licenses
The other shoe has fallen on DISH Network Corporation and the “DEs” that it used to bid in the AWS-3 (Auction 97) auction that finished earlier this year. The FCC on October 1st issued letters providing notice to Northstar Wireless LLC (Northstar) and SNR Wireless LIcenseCo, LLC (SNR) of their interim default payment obligations arising from Auction 97. Copies of these letters can be found here (Northstar) and here (SNR).
The FCC letters, and related letters that counsel for Northstar and SNR filed with the FCC also on October 1st, indicate that the DISH DEs have each elected not to pay any additional money to the FCC as a result of being found ineligible for “small business” status. Instead, each has elected to use the monies they had already paid the FCC for their winning bids and to “selectively default” on some of the licenses that it won. Selective default (electing to keep certain licenses that are paid in full while being “let off the hook” for payment obligations associated with returned licenses) is a controversial remedy that the FCC has allowed previous auction winners to use when faced with a potential default. The Dish DEs each escape a significant additional payment obligation associated with the loss of their claimed small business status, but they don’t get all the licenses they won, and they are required to make a “default” payment based on the licenses they return. The fact that the FCC’s interim default letters were already drafted and released on the very same day that the DISH DEs each filed their selective default letters suggests that the election was no surprise to the Commission’s staff, and instead was a carefully scripted arrangement.
Northstar has already paid the FCC approximately $5.9 billion. The difference between Northstar’s gross winning bids and net winning bids in the AWS-3 auction is $1.96 billion. Similarly, SNR has paid the FCC approximately $4.1 billion. The difference between SNR’s gross winning bids and net winning bids in the AWS-3 auction is $1.37 billion.
Pursuant to the Commission’s auction rules, and based on the election made in its Selective Default Letter, Northstar owes the FCC an interim default payment of $333,919,350, which is fifteen percent (15%) of the aggregate amount of all gross winning bids for the licenses it is returning to the FCC. SNR has similar default obligations and owes the FCC an interim default payment of $181,635,840. In addition to these payments, both of the DISH DEs will be obligated to pay the FCC, with respect to each license returned, the difference between the amount of its bid and the amount of the winning bid for the license in the FCC re-auction of AWS-3 spectrum, when that takes place in the future. The FCC has required DISH to act as guarantor in favor of the FCC with respect to these potential future payment obligations.
An analyst from Jeffries & Company has suggested that the strategic return of AWS-3 spectrum may suggest a potential deal between DISH and Verizon, because most of the licenses returned to the FCC are adjacent to AWS-1 spectrum blocks owned by AT&T and T-Mobile.
“It is possible that the selected licenses were chosen in such a fashion as to not impact a potential future sale of the portfolio to Verizon,” said Jeffries analyst Mike McCormack in a research report.
FCC Grants AT&T Request for Waiver of TTY Rules for Wi-Fi Calling
On October 6, the FCC granted the petition for waiver filed by AT&T, in which the company asked for a waiver of the FCC’s requirement to support text telephony (TTY) technology on wireless networks to the extent that they use Internet Protocol (IP) technologies. This waiver expires December 31, 2017, or upon the effective date of rules providing for alternative IP-based wireless accessibility solutions, whichever is earlier.
On June 12, 2015, AT&T filed a petition requesting that the Commission initiate a rulemaking proceeding to authorize the substitution of a newer form of text communication, real-time text (RTT), as an alternative accessibility solution to TTY technology for use in the IP-based environment. AT&T simultaneously filed a petition requesting that the Commission temporarily waive the Commission’s requirements to support TTY technology for wireless devices and services on Voice over Internet Protocol (VoIP) networks “during the pendency of the rulemaking and until RTT is fully deployed to allow [AT&T] to offer VoIP services that do not reliably support TTY.”
In granting the waiver, the FCC found that there “are major technical barriers to reliably supporting TTY transmissions over IP networks,” and that “overall use of TTYs has declined greatly, and that TTYs are seldom used on wireless networks.” As a condition of the waiver, the FCC is requiring AT&T to apprise its customers, through effective and accessible channels of communication, including via AT&T’s website, billing statements, promotional materials, communications with national consumer organizations, and other effective means of communications, that (1) TTY technology will not be supported for calls to 911 services over IP-based wireless services; and (2) there are alternative PSTN- based and IP-based accessibility solutions for people with communication disabilities for such calls. As part of meeting clause (2) of this condition, to the extent that AT&T begins to make RTT available, it must ensure that all 911 calls made by persons seeking emergency assistance using this technology are delivered in accordance with the obligations of all telecommunications carriers, including wireless carriers, to transmit 911 calls to the appropriate PSAP or local emergency authority. Additionally, once every six months, AT&T will file a report with the Commission, and also inform its customers, through the same channels set forth above, regarding its progress toward and the status of the availability of new IP-based accessibility solutions.
Law & Regulation
Comments on Totality of the Circumstances Test Due December 1
On October 2, the FCC published its Notice of Proposed Rulemaking on the “totality of the circumstances” test for evaluating whether broadcast stations and multichannel video programming distributors are negotiating for retransmission consent in good faith. Comments are due December 1, 2015, and reply comments are due December 31.
In the NPRM, the FCC seeks comment on whether it should make any updates to the “totality of the circumstances” test itself to ensure that the conduct of broadcasters and MVPDs during negotiations for retransmission consent, and after such negotiations have broken down, meet the good faith standard. The FCC also seeks comment on whether there are specific practices that it should identify as evidencing bad faith under the totality of the circumstances test.
RUS Seeks Comment on New Equipment Contract Process
On October 1, the Rural Utilities Service published a request for comments in the Federal Register regarding the streamlining of its contractual process for equipment procurement. Comments are due November 30.
Specifically, RUS is seeking to replace type-specific Equipment Contracts, RUS Forms 397, 398, 525, 545, and the associated documents (Forms 231, 396, 396a, 397b, 397c, 397d, 397f, 397g, 397h, 517, 525a, 744, 752a, 754, and addenda) with a new, unified Equipment Contract, RUS Form 395, and the associated close-out documents (Forms 395a, 395b, 395c and 395d).
FCC Issues Tentative Agenda for October 22 Open Meeting
On October 1, the FCC issued the tentative agenda for its October 22, 2015 Open Meeting. At the meeting, the FCC will consider:
- a Report and Order and Third FNPRM on reforming intrastate, interstate and international inmate calling services to ensure just, reasonable and fair ICS rates;an NPRM on streamlining the foreign ownership review process for broadcast licensees and applicants, and standardizing the review process for broadcast, common carrier and aeronautical licensees and applicants; and
- an NPRM on new flexible use service rules in certain bands above 24 GHz to support multiple uses, including mobile wireless.
Senate Commerce Holds Hearing on Wireless Broadband Deployment
Earlier today, the Senate Commerce Committee held a hearing Oct. 7 on how to help pave the way for more wireless broadband. Witnesses included: Douglas Kinkoph, Associate Administrator at the Office of Telecommunications and Information Applications of the National Telecommunications and Information Administration; The Honorable Jonathan Adelstein, President & CEO of PCIA – The Wireless Infrastructure Association; The Honorable Gary Resnick, Mayor of Wilton Manors; Mr. Cory Reed, Senior Vice President of Intelligent Solutions at Deere & Company; and Mr. Bruce Morrison, Vice President of Operations and Network Build for the North America region at Ericsson.
Full testimony for each of the witnesses can be found here .
Experian Discloses Massive Data Breach of T-Mobile Customers
On October 1, Experian Plc (Experian), one of the world’s leading consumer credit monitoring firms, announced a data breach that exposed the data of approximately 15 million individuals who had applied for wireless service from T-Mobile.
According to Experian, it discovered the breach on September 15. The data reportedly included names, addresses, birth dates, Social Security numbers, driver’s license numbers and passport numbers.
In a statement, T-Mobile Chief Executive John Legere said, “Obviously I am incredibly angry about this data breach and we will institute a thorough review of our relationship with Experian,” T-Mobile Chief Executive John Legere said in a note to customers posted on the company's website. “But right now my top concern and first focus is assisting any and all consumers affected.”
The attorney general of Connecticut has announced that he will launch an investigation into the breach.
OCTOBER 15: INITIAL 911 RELIABILITY CERTIFICATION . The Commission’s rules require Covered 911 Service Providers to take “reasonable measures” to provide reliable service with respect to 911 circuit diversity, central office backup power, and diverse network monitoring, as evidenced by an annual certification of compliance with specified best practices or reasonable alternative measures. The Initial Reliability Certification requires covered providers to demonstrate “substantial progress” toward meeting the requirements of the full Annual Reliability Certification, which is defined as compliance with standards of the full certification in at least 50 percent of the Covered 911 Service Provider’s critical 911 circuits, central offices that directly serve public safety answering points (PSAPs), and independently monitored 911 service areas.
OCTOBER 26: COMMENTS DUE ON SECTION 214 DISCONTINUANCE CRITERIA AND PROCESS. The FCC is seeking comments on a Further Notice of Proposed Rulemaking (FNPRM) which asks whether the Commission should revise its rules concerning the 214 application process and proposes specific criteria for use in evaluating applications to discontinue retail services pursuant to section 214 of the Act.
OCTOBER 29: COMMENTS DUE ON APPLICABLITY OF TELEMARKETING RULES TO GOVERNMENTS. A petition for declaratory ruling (CG Docket No. 02-278) asks the FCC to find that the Telephone Consumer Protection Act (TCPA) and the Commission’s implementing rules do not apply to calls made by or on behalf of federal, state, and local governments, including calls made by legislative, judicial, and executive bodies, and those who act on behalf of such government entities, when such calls are made for official purposes. BloostonLaw contacts: Ben Dickens, Gerry Duffy and Mary Sisak.
NOVEMBER 1: FCC FORM 499-Q, TELECOMMUNICATIONS REPORTING WORKSHEET. All telecommunications common carriers that expect to contribute more than $10,000 to federal Universal Service Fund (USF) support mechanisms must file this quarterly form. The FCC has modified this form in light of its decision to establish interim measures for USF contribution assessments. The form contains revenue information from the prior quarter plus projections for the next quarter. Form 499-Q relates only to USF contributions. It does not relate to the cost recovery mechanisms for the Telecommunications Relay Service (TRS) Fund, the North American Numbering Plan Administration (NANPA), and the shared costs of local number portability (LNP), which are covered in the annual Form 499-A that is due April 1.
Oct. 15 – 911 Reliability Certification.
Oct. 26 – Comments on Section 214 Discontinuance Criteria and Process.
Oct. 29 – Comments on Applicability of Telemarketing Rules to Government Calls
Oct. 30 – PRA Comments on the 2015 Lifeline Second Reform Order are due.
Nov. 1 – FCC Form 499-Q (Quarterly Telecommunications Reporting Worksheet) is due.
Nov. 13 – Reply Comments on Applicability of Telemarketing Rules to Government Calls
Nov. 24 – Reply Comments on Section 214 Discontinuance Criteria and Process.
Nov. 30 – Comments are due on RUS New Equipment Contract process.
Dec. 1 – Comments are due on the “Totality of the Circumstances” test.
Dec. 20 – Form 323 (Biennial Ownership Report) is due.
Dec. 31 – Reply comments are due on the “Totality of the Circumstances” test.