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. 16, No. 25 | July 10, 2013 |
Headlines AT&T Comments on Technology Trials Shed Light on Future Plans and Lobbying AT&T's July 8 comments to the FCC's Technology Transitions Policy Task Force indicate that it is pursuing a far more aggressive and comprehensive IP agenda than the potential technical trials for which the Task Force sought industry input. Claiming that more than 70 percent of the residential customers in its 22-state region have "abandoned traditional wireline telecommunications services in favor of next generation alternatives," AT&T continues to support its November 2012 proposal for comprehensive all-IP "trials" rather than the more limited technical trials proposed by the Task Force. AT&T thereby serves notice that it will push the FCC to retire the TDM-based Public Switched Telecommunications Network (PSTN) as early as 2018. AT&T makes it clear that it intends to terminate its rural wireline TDM networks and services, and that it has no intention of deploying rural wireline IP networks or services. It declares that, in the future, "wireless IP services will be the only option for some AT&T consumers who live in hard-to-reach areas where it is no longer economically feasible to maintain existing TDM-based wireline services, much less deploy wireline IP networks and services." AT&T declares that maintaining existing wireline services in "hard to reach areas" (read, rural) is no longer possible absent significant subsidies that neither the FCC nor the states have shown any inclination or ability to provide. AT&T also clarifies that its proposed "geographic area trials" are really mandatory, one-way migrations of wireline TDM customers to wireless LTE (Long Term Evolution) services, and that the wireline TDM services discontinued during a "trial" will not be revived. Conceding that there will be some consumers who do not want to change, AT&T declares that the FCC "cannot allow a small minority of consumers to hold back progress." AT&T carefully words its claim that its proposed rural wireless LTE alternative "generally will be far superior to the TDM services currently available" so as to limit the comparison to existing service quality in AT&T's frequently neglected rural exchanges rather that to the far superior service quality in existing and future RLEC wireline networks. As pointed out previously by the RLEC Associations, AT&T's proposed "trials" are not "trials" in any reasonable sense of that term, but rather constitute a very transparent attempt to present the FCC and state commissions with a fait accompli that a substantial portion of the AT&T network has become an unregulated IP network that no longer provides TDM services (including rural wireline service and, quite possibly, tandem switching). AT&T opposes the FCC's proposed VoIP interconnection trials as too narrow, and points out that there will be no distinction between IP-enabled voice traffic and IP-enabled data traffic on the all-IP network. It also points out that the FCC's proposal to conduct VoIP interconnection trials in specific geographic markets disregards IP network engineering principles, and that interconnection arrangements for the exchange of VoIP traffic in an all-IP environment will be likely to utilize a broad geographic scope similar to the existing peering and transit arrangements for the exchange of Internet traffic. AT&T serves clear notice that it will vigorously oppose the use of Sections 251 and 252 of the Communication Act to resolve IP interconnection disputes. AT&T also opposes VoIP interconnection trials on the ground that the development of an ENUM numbering database needs to be completed first, and opposes NG911 trials on the basis that standards defining the interconnection between originating IP networks and ESInets need to be finalized first. AT&T does recommend two types of trials — first, a limited trial of electronic vouchers to subsidize the purchase of voice or broadband services or bundles by eligible low-income consumers; and, second, a trial of a Just in Time inventory method to distribute telephone numbers on an individual basis rather than in thousand-number blocks. The AT&T proposals need to be carefully studied by RLECs. They may or may not gain traction with the incoming Wheeler FCC and its successors, but they are likely to influence telecommunications policy debate during the next few years. RLECs may decide to reconsider or adjust their business and lobbying strategies to support or oppose AT&T, but their investment and business plans nonetheless will be impacted in myriad ways by what a large industry player like AT&T does or tries to do. These developments also emphasize the need for rural carriers to prepare for a world where IP-based and wireless services dominate. BloostonLaw will continue to monitor the Task Force proceedings, and the various proposals advanced therein by AT&T and others. Acting Chairwoman Clyburn Responds to Congressional Members on Lifeline Reform On June 20, 2013, Acting Chairwoman Mignon Clyburn responded to concerns expressed by Rep. Steve Stockman (R- Texas) with the recent growth and lack of apparent controls on the Lifeline Program. Clyburn also responded to Sen. Charles Grassley (R-Iowa), who had asked the FCC to clarify the factors that caused the Lifeline program to almost double in subscribers from 2008 and the procedures have been implemented to address waste, fraud and abuse in the program. Clyburn provided each congressional member with an individually addressed letter from the Wireline Competition Bureau's Telecommunications Access Policy Division addressing their respective questions. As the BloostonLaw Telecom Update has reported in the past, congressional concern over the Lifeline program has grown considerably in recent years, with some members calling for its outright elimination. The letters from the Chief of the Bureau's Telecommunications Access Policy Division collectively state that the Lifeline Program is on track to save an estimated $2 billion by the end of 2014, and that these savings will be achieved through reform and modernization of all aspects of the program. The letters state that the reforms include: 1) requiring consumers to provide proof of eligibility at enrollment;
2) requiring consumers to certify that they understand key program rules and to re-certify annually their continued eligibility for support;
3) limiting the Lifeline benefit to one per household;
4) eliminating Link Up support for all providers except those that receive high-cost universal support on Tribal lands;
5) establishing a uniform, nationwide floor for consumers' eligibility to participate in the program, which states may supplement;
6) enhanced requirements concerning marketing and advertising practices of supported carriers; and
7) putting in place a robust audit requirement for providers entering the Lifeline program and an ongoing independent audit requirement for providers drawing more than $5 million from the fund.
These reforms were characterized as having "fundamentally altered the course of the program;" noting that disbursements have declined steadily from $185.1 million in December 2012 to $145.8 million in May 2013; and that subscribership has declined steadily since August 2012 from 18.2 million subscribers to 13.2 million in April 2013. In addition to these reforms, the Division Chief stated that the Universal Service Administrative Company (the fund administrator) is building the National Lifeline Accountability Database that will, by the end of 2013, detect and prevent duplicative support before it occurs. The Division Chief also stated that as part of the commitment to fight waste, fraud and abuse in the program, the FCC now requires all non-facilities-based providers seeking to become Lifeline-only Eligible Telecommunications Carriers (which includes prepaid Lifeline-only carriers) to first have a compliance plan approved by the Wireline Competition Bureau before being designated as an ETC by a state or the FCC; and that FCC staff thoroughly reviews these plans to ensure that providers have procedures in place to adhere to the new, stringent program requirements. Rep. Stockman's letter, along with the FCC's response, can be found here ; Sen. Grassley's letter, along with the FCC's response, can be found here . FCC Seeks Comment on Draft Eligible Services List for E-Rate Program The Wireline Competition Bureau released a Public Notice on July 3, 2013, seeking comment on draft eligible services list (ESL) for the schools and libraries universal service support mechanism (a.k.a E-rate program) for funding year 2014. Comments are due August 2; replies due August 19. Specifically, the FCC is seeking comment on: - changes to the organization of the ESL to make it a more useful tool during the application process (i.e., when applicants use the ESL to fill out the FCC Form 470 and FCC Form 471 to seek bids for services and request E-rate discounts on those services);
- clarifying language in the "Fiber or Dark Fiber" entry of the ESL to provide more detail on the differences between the eligible components of a lit fiber service versus a dark fiber service;
- clarification that eligible features available through a hosted web site are not eligible for E-rate support as stand-alone offerings, and that applicants may seek E-rate support for web hosting services purchased from a single provider, but may not seek E-rate support for services purchased from multiple web hosting providers;
- whether the current definition and description of eligible and ineligible web hosting services may be interpreted differently among vendors, and if differing interpretations could inadvertently promote competitive disadvantages; and
- clarification of the definition of "Internet Access" in the ESL Glossary by defining it in accordance with Section 54.5 of the Commission's rules. Section 54.5 states that "Internet access" includes the following elements:
- 1) the transmission of information as common carriage;
- (2) the transmission of information as part of a gateway to an information service, when that transmission does not involve the generation or alteration of the content of information, but may include data transmission, address translation, protocol conversion, billing management, introductory information content, and navigational systems that enable users to access information services, and that do not affect the presentation of such information to users; and
- (3) electronic mail services (e-mail).
The Public Notice also includes as an attachment a draft ESL for 2014. FCC Seeks Paperwork Reduction Act Comments on E-Rate Forms A Request for Comments appeared in the Federal Register on July 5, 2013 seeking Paperwork Reduction Act (PRA) comments on FCC Forms 470 and 471 (and instructions), which are used in the E-Rate program. Comments are due September 3. According to the Request, the FCC is reviewing this collection "in an effort to simplify the application process and to better collect information related to the broadband services being ordered by schools and libraries under the E-rate program." Specific revisions include proposals to collapse the telecommunications services and Internet access categories into one category of service on the FCC Form 470; eliminate Block 2 of the FCC Form 471 (Impact of Service Ordered for Schools and Libraries) and add questions asking about broadband and other connectivity services will be added to Block 5 for each funding request; and further revision to Form 471 to allow applicants to indicate whether they are a federal entity. The FCC indicates that it expects these revisions to increase the hourly burden associated with the Forms. PRA comments must focus on whether the proposed collection of information is necessary for the proper performance of the functions of the Commission; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents; and ways to further reduce the information burden for small business concerns with fewer than 25 employees.
Law & Regulation Senate Hearing on Stopping Fraudulent Robocalls The U.S. Senate Subcommittee on Consumer Protection, Product Safety and Insurance will hold a hearing on Wednesday, July 10, 2013 at 10:00 a.m. titled, "Stopping Fraudulent Robocall Scams: Can More Be Done?" The hearing will examine the consumer harm associated with fraudulent robocalls; the effectiveness of regulations and law enforcement in stopping these calls; and the feasibility of technological solutions aimed at preventing fraudulent robocalls from reaching vulnerable consumers. Two panels of witnesses will testify, including Lois Greisman, Associate Director, Division of Marketing Practices, Bureau of Consumer Protection, Federal Trade Commission; Eric Bash, Associated Bureau Chief, Enforcement Bureau, Federal Communications Commission; Kevin G. Rupy, Senior Director, Law and Policy, United States Telecom Association; Michael F. Altschul, Senior Vice President and General Counsel, CTIA – The Wireless Association; Matthew Stein, Chief Technology Officer, Primus Telecommunications, Inc. and Aaron Foss, Freelance Software Developer, Nomorobo. The hearing will be webcast live via the Senate Commerce Committee website . House Hearing on Improving FCC Process The Subcommittee on Communications and Technology has scheduled a hearing on Thursday, July 11, 2013 at 10:30 a.m. in 2123 Rayburn House Office Building entitled "Improving FCC Process." One panel of witnesses will testify, including Stuart M. Benjamin, Douglas B. Maggs Chair in Law and Associate Dean for Research, Duke Law; Larry Downes, Internet industry analyst and author , including The FCC's Unstructured Role in Transaction Reviews ; Robert M. McDowell, Former FCC Commissioner and Visiting Fellow, Hudson Institute; Randolph J. May, President, Free State Foundation; Richard J. Pierce Jr., Lyle T. Alverson Professor of Law, George Washington University Law School; and James Bradford Ramsay, General Counsel, National Association of Regulatory Utility Commissioners. In announcing the hearing, the Subcommittee noted that poor procedures at the FCC can produce flawed decisions and chill the vibrancy of the current telecommunications marketplace, particularly in the present economy. For that reason, the Subcommittee plans to reintroduce two bills that passed the House last Congress: H.R. 3309, the Federal Communications Commission Process Reform Act, and H.R. 3310, the Federal Communications Commission Consolidated Reporting Act. These bills attempt to "minimize the potential for procedural failings and abuse, and to improve the Commission's transparency, efficiency, and accountability." The hearing will focus on discussion drafts of the two bills in expectation of reintroduction of the bills. To summarize the proposed bills, the Federal Communications Process Reform Act passed the House in March 2012 by a 247-174 vote. The legislation was modeled on principles included in the President's January 2011 Executive Order 13563 – Improving Regulation and Regulatory Review, which applies only to executive agencies and does not compel the Commission to action. Many of the provisions in the bill simply require the Commission to set its own process rules and then abide by them. Among other things, the bill asks the FCC review the state of technology and the marketplace and conduct cost-benefit analyses before regulating; to publish the text of proposed rules; to provide Commissioners, parties, and the public with sufficient opportunity to review proposals; to publish its decisions promptly; and to assess whether adopted rules are meeting their purpose. It requests that the FCC create "shot clocks" so parties and the public have a sense of when issues will be resolved. To minimize the potential for abuse of transaction reviews, the bill would require any conditions to be narrowly adapted to transaction-specific harms and otherwise within the agency's jurisdiction. To facilitate negotiation, the bill would reform the "Sunshine Act" to allow three or more Commissioners to gather on a bipartisan basis. The Federal Communications Consolidated Reporting Act passed the House in May 2012 on a voice vote. It seeks to ease burdens on the agency and to make reports more meaningful. By eliminating outdated studies and consolidating the ones that remain into a biennial release, the Commission will be more efficient and can provide more constructive information to the public. The draft also proposes a "State of the Industry" report, concentrated on the challenges and opportunities in the marketplace as well as the Chairperson's plan of action. The hearing will be webcast live via the House Energy & Commerce Committee website .
Industry FCC Approves SoftBank/Sprint/Clearwire Transaction On Friday, July 5, 2013, the FCC approved SoftBank's proposed acquisition of a 78 percent indirect ownership interest in Sprint Nextel and Sprint Nextel's acquisition of the remaining interests in Clearwire. The decision, while not surprising in light of recent developments, is significant because Sprint Nextel will become majority-owned by a Japanese publicly-traded holding company with telecommunications and Internet-based investments throughout the world, including Japan's third largest wireless carrier. The Sprint Nextel/Clearwire acquisition will give SoftBank its first inroads into the US wireless marketplace. SoftBank's status as a new entrant into the US marketplace is significant since it eliminated any concerns regarding spectrum aggregation. Like all transactions, the FCC must determine whether the transaction will serve the public interest. In making this determination, the FCC considers various factors related to the applicant's legal, financial and technical qualifications as well as the potential impact on the competitive marketplace, including spectrum aggregation. The Sprint Nextel/SoftBank transaction was unique since it brought two unusual factors to a single transaction — majority indirect foreign ownership and a new entrant into the US wireless market place. And, unlike most large transactions that have involved the merger of US carriers or the sale of significant assets from one carrier to another, this transaction did not have the typical competitive and spectrum aggregation issues since SoftBank had no prior wireless presence in the US. Nonetheless, the Commission concluded that further inquiry with respect to Clearwire's 2.5 GHz holdings was required. Based upon this more detailed review, the Commission concluded that the transaction was "not likely to result in any competitive or other public interest harm in the provision of mobile wireless services." In this proceeding, Verizon Wireless, Taran, DISH and others urged the Commission to expand its spectrum screen to include the remaining Broadband Radio Service (BRS) spectrum and nearly all of the Educational Broadband Service (EBS) spectrum in the spectrum screen since these frequency bands are "suitable and available for mobile telephony/broadband services." Verizon Wireless noted that Clearwire is currently using substantial portions of its BRS and EBS holdings to provide mobile broadband service and that because the Commission has included 20 MHz of WCS spectrum in the 2.3 GHz band as part of the spectrum screen, it would be appropriate to include this additional BRS and EBS spectrum as well. The Commission declined Verizon Wireless' request to expand the spectrum screen to include more than 55.5 MHz of 2.5 GHz spectrum, since the SoftBank/Sprint Nextel/Clearwire deal did not raise any spectrum aggregation issues. The FCC found that the same amount of spectrum would be attributable to Sprint Nextel before and after the transaction. Competitive concerns were also raised that the acquisition of Clearwire could have an adverse impact on wholesale prices. The Commission noted that these concerns were unfounded since Sprint Nextel was Clearwire's primary wholesale customer and that any loss of Clearwire's sales to other customers would have a minimal impact on the market place. The Commission also cleared SoftBank's foreign ownership of Sprint Nextel and Clearwire even though it would have a greater than 75 percent indirect foreign ownership interest, since Japan is a WTO Member country. SoftBank sought FCC approval in connection with the commercial wireless/common carrier licenses that it would acquire from Sprint Nextel. Approval for the non-common carrier licenses held by Clearwire was unnecessary since there is no foreign ownership limitation for non-common carrier licenses, and as the FCC noted, the Clearwire licenses are not being used to provide broadcast services. Because the licenses that were the subject of the Declaratory Ruling Petition were common carrier licenses, the FCC determined that the favorable presumption afforded to foreign investors from WTO member countries such as Japan, under the FCC's Foreign Participation Order, would apply. In approving this transaction, Commissioner Pai noted in a separate statement that this transaction should be an important precedent for other transactions that do not result in a change in attributable spectrum. Additionally, Commissioner Pai pointed out that the FCC's informal 180-day shot clock for transactions should be made part of the FCC's Rules, rather than an informal policy, in order to ensure that parties to transactions will have "confidence that the [FCC] is acting with dispatch." Report: U.S. Cable Companies to Deploy More than 250,000 Wi-Fi Hotspots by Mid-2014 Fierce Wireless and others are reporting that, according to a report from an independent research firm, U.S. cable companies are expected to deploy more than 250,000 Wi-Fi hotspots by mid-2014, an increase of more than 60 percent on the current installed base. "Wi-Fi has given cable a vital entry point into wireless," said Craig Leddy, a Heavy Reading contributing analyst who authored the report, From Wired to Wireless: Cable Uses Wi-Fi to Extend Its Reach. "We found that the major MSOs are aggressively deploying hotspots and we expect that their role in wireless will continue to grow. For wired service providers, wireless has become an imperative." Over the past few months, major cable companies like Time Warner Cable, Comcast and Cox have all made announcements about plans to deploy Wi-Fi in their service areas. Coupled with Passpoint Hotspot 2.0 technology that supports cellular-Wi-Fi roaming, some analysts believe this could allow cable companies to cut into a wireless industry currently dominated by the likes of AT&T Mobility and Verizon Wireless as early as next year.
Deadlines AUGUST 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 August 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. 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.
Calendar At-A-Glance Jul. 10 – U.S. Senate Subcommittee on Consumer Protection, Product Safety and Insurance "Stopping Fraudulent Robocall Scams: Can More Be Done?" Hearing.
Jul. 11 – U.S. House Subcommittee on Communications and Technology "Improving FCC Process" Hearing.
Jul. 12 – Comments on Separate Affiliate Requirements for Rate of Return Carriers are due.
Jul. 14 – Reply comments in response to the FCC's Notice of Proposed Rulemaking to revise Part 15 of the Rules to permit Unlicensed National Information Infrastructure devices in the 5 GHz band are due. This deadline has been extended from June 24 to July 14.
Jul. 16 – Paperwork Reduction Act Comments on Proposed Collection of Urban Rates Survey Information are due.
Jul. 18 – Comments are due in the FCC's Contraband Wireless Device proceeding.
Jul. 19 – Comments are due on VoIP Direct Access to Numbering NPRM.
Jul. 24 – Deadline for reply comments on revision of Part 15 Rules to Permit U-NII Devices in 5GHz Band.
Jul. 25 – Comments are due on the FCC Staff Report on Rate of Return Re-Prescription.
Jul. 29 – Comments due on Verizon Petition to Discontinue Service to Fire Island.
Jul. 31 – Comments are due on the ONA/CEI Further Notice of Proposed Rulemaking.
Jul. 31 – FCC Form 507 due (Universal Service Quarterly Line Count Update).
Aug. 1 – FCC Form 502 due (North American Numbering Plan Utilization and Forecast Report).
Aug. 1 – Reply comments are due on VoIP Direct Access to Numbering NPRM.
Aug. 2 – Comments are due on E-Rate Draft Eligible Services list.
Aug. 8 – Electronic filing deadline for Form 497 for carriers seeking support for the preceding month and wishing to receive reimbursement by month's end.
Aug. 12 – Reply comments on Separate Affiliate Requirements for Rate of Return Carriers are due.
Aug. 19 – Comments on reforms to protect VRS program are due.
Aug. 19 – Reply comments are due on E-Rate Draft Eligible Services list.
Sep. 3 – Comments are due on FCC's guidelines for human exposure to RF electromagnetic fields.
Sep. 3 – Paperwork Reduction Act comments are due on E-Rate Forms 470 and 471.
Sep. 8 – Electronic filing deadline for Form 497 for carriers seeking support for the preceding month and wishing to receive reimbursement by month's end.
Sep. 18 – Reply Comments on reforms to protect VRS program are due.
Oct. 14 – Deadline to seek extension of CALM Act small provider grace period.
Oct. 8 – Electronic filing deadline for Form 497 for carriers seeking support for the preceding month and wishing to receive reimbursement by month's end.
Nov. 1 – Reply Comments are due on FCC's guidelines for human exposure to RF electromagnetic fields. |
CLICK HERE
Jon Blacker/Reuters
Apple has been granted a patent today (via 
David George and Bill Noyes
