[Federal Register: February 21, 2008 (Volume 73, Number 35)]
[Proposed Rules]
[Page 9507-9515]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21fe08-30]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 52
[WCB: WC Docket Nos. 07-243, 07-244; FCC 07-188]
Telephone Number Requirements for IP-Enabled Services Providers;
Local Number Portability Porting Interval and Validation Requirements
AGENCY: Federal Communications Commission.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Federal Communications Commission (Commission) adopted a
Notice of Proposed Rulemaking seeking comment on whether the Commission
should extend local number portability (LNP) requirements and numbering
related rules, including compliance with N11 code assignments, to
interconnected voice over Internet Protocol (VoIP) providers, and
whether the Commission should adopt rules specifying the length of
porting intervals or other details of the porting process.
DATES: Comments are due on or before March 24, 2008, and reply comments
are due on or before April 21, 2008
ADDRESSES: You may submit comments, identified by WC Docket Nos. 07-243
and 07-244, 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. E-mail: ecfs@fcc.gov., and include the following words in
the body of the message, ``get form.'' A sample form and directions
will be sent in response. Include the docket number(s) in the subject
line of the message.
Mail: Secretary, Federal Communications Commission, 445
12th Street, SW., Washington, DC 20554.
Hand Delivery/Courier: 236 Massachusetts Avenue, NE.,
Suite 110, Washington, DC 20002.
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by e-mail: FCC504@fcc.gov or phone: 202-418-
0530 or TTY: 202-418-0432.
All submissions received must include the agency name and docket
number for this rulemaking, WC Docket Nos. 07-243 and 07-244. All
comments received will be posted without change to http://www.fcc.gov/cgb/ecfs.
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: Melissa Kirkel, Wireline Competition
Bureau, (202) 418-1580.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking (Notice) in WC Docket Nos. 07-243 and 07-244,
FCC 07-188, adopted October 31, 2007, and released November 8, 2007.
The complete text of this document is available for inspection and
copying during normal business hours in the FCC Reference Information
Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC
20554. This document may also be purchased from the Commission's
duplicating contractor, Best Copy and Printing, Inc., 445 12th Street,
SW., Room CY-B402, Washington, DC 20554, telephone (800) 378-3160 or
(202) 863-2893, facsimile (202) 863-2898, or via e-mail at http://www.bcpiweb.com.
It is also available on the Commission's Web site at
http://www.fcc.gov.
Public Participation
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 regarding the Notice on or before the dates indicated on the
first page of this document. All filings related to this Notice of
Proposed Rulemaking should refer to WC Docket No. 07-243 or WC Docket
No. 07-244. All filings made in response to the Notice section on
interconnected VoIP provider numbering obligations should be filed in
WC Docket No. 07-243. All filings made in response to the Notice
sections on port request validation and porting intervals should be
filed in WC Docket No. 07-244. 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).
[[Page 9508]]
Electronic Filers: Comments may be filed electronically
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ or the Federal eRulemaking Portal: http://www.regulations.gov. Filers
should follow the instructions provided on the Web site for submitting
comments.
ECFS filers must transmit one electronic copy of the
comments for WC Docket Nos. 07-243 and 07-244. In completing the
transmittal screen, filers should include their full name, U.S. Postal
Service mailing address, and the applicable docket number. Parties may
also submit an electronic comment by Internet e-mail. To get filing
instructions, filers should send an e-mail to ecfs@fcc.gov, and include
the following words in the body of the message, ``get form.'' A sample
form and directions will be sent in response.
Paper Filers: Parties who choose to file by paper must
file an original and four copies of each filing. Filings can be sent by
hand or messenger delivery, by commercial overnight courier, or by
first-class or overnight U.S. Postal Service mail (although we continue
to experience delays in receiving U.S. Postal Service mail). All
filings must be addressed to the Commission's Secretary, Marlene H.
Dortch, Office of the Secretary, Federal Communications Commission, 445
12th Street, SW., Washington, DC 20554.
The Commission's contractor will receive hand-delivered or
messenger-delivered paper filings for the Commission's Secretary at 236
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing
hours at this location are 8 a.m. to 7 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 should be addressed to 445 12th Street, SW., Washington, DC 20554.
Parties should send a copy of their filings to the Competition
Policy Division, Wireline Competition Bureau, Federal Communications
Commission, Room 5-C140, 445 12th Street, SW., Washington, DC 20554, or
by e-mail to cpdcopies@fcc.gov. Parties shall also serve one copy with
the Commission's copy contractor, Best Copy and Printing, Inc. (BCPI),
Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554,
(202) 488-5300, or via e-mail to fcc@bcpiweb.com.
Documents in WC Docket Nos. 07-243, and 07-244 will be available
for public inspection and copying during business hours at the FCC
Reference Information Center, Portals II, 445 12th Street, SW., Room
CY-A257, Washington, DC 20554. The documents may also be purchased from
BCPI, telephone (202) 488-5300, facsimile (202) 488-5563, TTY (202)
488-5562, e-mail fcc@bcpiweb.com.
Synopsis of Notice of Proposed Rulemaking
1. Through this Notice, the Commission considers whether there are
additional number administration requirements that the Commission
should adopt to benefit customers of telecommunications and
interconnected VoIP services. First, the Commission seeks comment on
whether it should act to extend other numbering-related obligations to
interconnected VoIP providers. Second, the Commission seeks comment on
whether it should adopt specific rules regarding the LNP validation
process and porting interval lengths.
A. Interconnected VoIP Provider Numbering Obligations
2. The Commission seeks comment on issues associated with the
implementation of LNP for users of interconnected VoIP services. The
Commission also seeks comment on whether any of its numbering
requirements, in addition to LNP, should be extended to interconnected
VoIP providers. For example, the Commission seeks comment on whether it
should require interconnected VoIP providers to comply with N11 code
assignments. The Commission already requires interconnected VoIP
providers to supply 911 emergency calling capabilities to their
customers whose service connects with the PSTN and to offer 711
abbreviated dialing for access to telephone relay services. Commenters
should provide information on the technical feasibility of a
requirement to comply with the other N11 code assignments. The
Commission also seeks comment on the benefits and burdens, including
the burdens on small entities, of requiring interconnected VoIP
providers to comply with N11 code assignments or other numbering
requirements.
B. LNP Process Requirements
3. As the Commission has found, it is critical that customers be
able to port their telephone numbers in an efficient manner in order
for LNP to fulfill its promise of giving ``customers flexibility in the
quality, price, and variety of telecommunications services.'' Although
customers have had the option to port numbers between their telephone
service providers for a number of years, the length of time for ports
to occur and other difficulties with the porting process may hinder
such options. Therefore, the Commission seeks comment on whether it
should take steps to mandate or modify certain elements of the porting
process to ensure the efficiency and effectiveness of LNP for U.S.
telephone consumers.
4. The Commission finds this to be a significant concern both
because of the statutory requirement to ensure ``the ability of users
of telecommunications services to retain, at the same location,
existing telecommunications numbers without impairment of quality,
reliability, or convenience when switching from one telecommunications
carrier to another,'' as well as the important role intermodal
providers play in telecommunications competition. Indeed, incumbent
local exchange carriers (LECs) have sought to rely on the presence of
telephone competition from wireless providers and cable operators when
seeking relief from regulatory obligations. To help enable such
intermodal competition, and the deregulation that can result from such
competition, it thus is important for the Commission to ensure the
efficiency and effectiveness of LNP, which ``eliminates one major
disincentive to switch carriers'' and thus facilitates ``the successful
entrance of new service providers.'' However, the Commission does not
limit its inquiry specifically to intermodal LNP but seeks comment on
the need for Commission requirements on LNP processes in other contexts
as well.
5. The Commission's conclusion that carriers can require no more
than four fields for validation of a simple port, and what information
those fields should contain, addresses the consideration of the
appropriate amount and type of information necessary to effectuate a
port. The Commission seeks comments on how the information required for
validation fields adopted by the Commission affects the validation
process, including any other ways that those validation fields could
minimize the error rates or further reduce the amount of information
that a porting-in entity must request from the porting-out entity prior
to submitting the simple port request. Further, the Commission seeks
comment on any other considerations that it should evaluate in the
simple port validation process.
6. The evidence in the record also shows that delays in the porting
process can arise when the porting-out carrier
[[Page 9509]]
fails to identify all errors in a Local Service Request (LSR) at once.
If a provider identifies errors one at a time, this necessitates
multiple resubmissions of the LSR, and delays the porting process. The
Commission agrees with commenters such as AT&T that it may not be
possible for providers to identify all errors at once, although the
porting process will proceed most efficiently if providers identify as
many errors as possible at a given time. The Commission seeks comment
on whether it should adopt a requirement that carriers identify all
errors possible in a given LSR and describe the basis for rejection
when rejecting a port request.
7. Finally, the Commission seeks comment on the benefits and
burdens, including the burdens on small entities, of the specific
requirements on the validation process proposed above, and any other
such requirements.
8. Porting Intervals. The Commission tentatively concludes that it
should adopt rules reducing the porting interval for simple port
requests. The Commission seeks comment on that tentative conclusion,
and on it should establish time limits on the porting process for all
types of simple port requests (i.e., wireline-to-wireline ports,
wireless-to-wireless ports, and intermodal ports) or just certain types
of ports. The wireless industry has established a voluntary standard of
two and one-half hours for wireless-to-wireless ports. The Commission
seeks comment on whether it should adopt a rule codifying this
standard.
9. The Commission also tentatively concludes that it should adopt
rules reducing the porting interval for wireline-to-wireline and
intermodal simple port requests, specifically, to a 48-hour porting
interval. As noted above, the wireless industry has been successful in
streamlining the validation process for wireless-to-wireless porting,
and the Commission encourages the industry to evaluate whether similar
streamlining measures would work for intermodal or wireline-to-wireline
porting. The Commission notes, moreover, that pending resolution of
this rulemaking proceeding, providers remain free to seek enforcement
action against a porting-out carrier that requests validation
information that appears to obstruct or delay the porting process.
10. For wireline-to-wireline simple ports, the Commission adopted
the NANC's 1997 recommendation of a four business day porting interval.
This four-day interval also applies to wireline-to-wireless intermodal
simple ports. It has been over ten years since the Commission
reassessed the porting interval for wireline-to-wireline ports, and
commenters suggest that advances in technology allow for the four-day
porting interval to be reduced. For intermodal porting intervals, the
Commission has twice sought comment on whether the porting interval
could be reduced. Most recently, the Commission specifically sought
comment on detailed NANC proposals for shortening the intermodal
porting interval, which included specific timelines for the porting
process.
11. While some commenters advocate retaining the current porting
intervals, other providers assert that shorter intervals are possible.
For example, Comcast asserts that a ``next day'' standard for wireline
ports that, in most cases, would not exceed 36 hours is more
appropriate in light of technological advancements and recent
competitive developments. Other commenters recommend refreshing the
record in the Intermodal Number Portability FNPRM (68 FR 68831, Dec.
10, 2003) and considering the NANC's proposal that would effectively
reduce the porting interval to 53 hours. Commenters seeking shorter
intervals point out the benefits to consumers and competition arising
when ports can occur more quickly.
12. Given that the industry has been unable to reach consensus on
an updated industry standard for wireline-to-wireline and intermodal
simple ports, the Commission tentatively concludes that it should adopt
rules regarding a reduced porting interval and allow the industry to
work through the actual implications of such a timeline. In particular,
the Commission tentatively concludes that it should adopt a 48-hour
porting interval, as it falls between the range of proposed shorter
intervals. In setting this interval, the Commission hopes to encourage
industry discussion and consensus. The Commission seeks comment on its
tentative conclusions, and whether there are any technical impediments
or advances that affect the overall length of the porting interval such
that it should adopt different porting intervals for particular types
of simple ports (e.g., wireline-to-wireline, wireline-to-wireless,
wireless-to-wireline). Further, the Commission seeks comment on how it
should define the various porting interval timelines in terms of
operating hours.
13. Finally, the Commission seeks comment on the benefits and
burdens, including the burdens on small entities, of adopting rules
regarding porting intervals for all types of simple port requests.
14. The Commission encourages interested parties to take into
account the fact that as technologies and business practices evolve, it
expects that the porting interval would decrease in order to provide
consumers as quick and efficient a porting process as possible. The
Commission looks forward to a complete record on the appropriate
porting interval consistent with the shortest reasonable time period.
15. Other LNP Process Issues. Commenters identify a number of other
concerns regarding the LNP process that they assert are hindering the
ability of consumers to take advantage of LNP. For example, Charter
comments that certain carriers' processes result in cancellation of a
subscriber dial tone for port requests that are delayed for operational
reasons. Charter also argues that carriers should be: (1) Required to
provide the basis for rejecting a port request at the time of that
rejection; (2) required to provide affirmative notice of all changes to
their porting requirements and process; and (3) prohibited from making
ad hoc changes to their procedures. Charter also argues that the
Commission should declare that interconnection agreements are not a
necessary precondition to effectuating wireline-to-wireline ports. The
Commission seeks comment on these and any other concerns regarding the
LNP process more generally, including the port validation process and
porting intervals for non-simple ports.
C. New Dockets
16. In this Notice, the Commission opens two new dockets--WC Docket
No. 07-243 and WC Docket No. 07-244. All filings made in response to
the Notice section on interconnected VoIP provider numbering
obligations should be filed in WC Docket No. 07-243. All filings made
in response to the Notice sections on port request validation and
porting intervals should be filed in WC Docket No. 07-244.
Initial Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission has prepared the present Initial
Regulatory Flexibility Analysis (IRFA) of the possible significant
economic impact on small entities that might result from this Notice of
Proposed Rulemaking (Notice). Written public comments are requested on
this IRFA. Comments must be identified as responses to the IRFA and
must be filed by the deadlines for comments on the Notice provided
above. The Commission will send a copy of the Notice, including this
IRFA, to the Chief Counsel for Advocacy of the Small Business
Administration. In
[[Page 9510]]
addition, the Notice and the IRFA (or summaries thereof) will be
published in the Federal Register.
A. Need for, and Objectives of, the Proposed Rules
2. In this Notice, the Commission considers whether there are
additional numbering-related requirements the Commission should adopt
to benefit customers of telecommunications and interconnected VoIP
services. Specifically, the Commission seeks comment on whether it
should extend other LNP requirements and numbering-related rules,
including compliance with N11 code assignments, to interconnected VoIP
providers. The Commission also seeks comment on whether it should adopt
rules specifying the length of the porting intervals or other changes
to the LNP validation process, or other details of the porting process.
Among other things, the Commission tentatively concludes that it should
adopt rules reducing the porting interval for wireline-to-wireline and
intermodal simple port requests, specifically, to a 48-hour porting
interval. The Commission seeks comment on its tentative conclusions and
issues related to its tentative conclusions. For each of these issues,
the Commission also seeks comment on the burdens, including those
placed on small carriers, associated with corresponding Commission
rules related to each issue.
B. Legal Basis
3. The legal basis for any action that may be taken pursuant to
this Notice is contained in sections 1, 4(i), 4(j), 251 and 303(r) of
the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i)
through (j), 251, 303(r).
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules May Apply
4. 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. The RFA generally defines the term
``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A small business concern is one 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 Small Business
Administration (SBA).
5. Small Businesses. Nationwide, there are a total of approximately
22.4 million small businesses, according to SBA data.
6. Small Organizations. Nationwide, there are approximately 1.6
million small organizations.
7. 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.'' Census Bureau data for 2002
indicate that there were 87,525 local governmental jurisdictions in the
United States. The Commission estimates that, of this total, 84,377
entities were ``small governmental jurisdictions.'' Thus, the
Commission estimates that most governmental jurisdictions are small.
1. Telecommunications Service Entities
a. Wireline Carriers and Service Providers
8. The Commission has included small incumbent local exchange
carriers (LECs) 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.'' The SBA's Office of Advocacy contends that, for RFA
purposes, small incumbent LECs are not dominant in their field of
operation because any such dominance is not ``national'' in scope. The
Commission has therefore included small incumbent LECs in this RFA
analysis, although the Commission emphasizes that this RFA action has
no effect on Commission analyses and determinations in other, non-RFA
contexts.
9. Incumbent LECs. Neither the Commission nor the SBA has developed
a small business size standard specifically for incumbent local
exchange services. The appropriate size standard under SBA rules is for
the category Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 1,303 carriers have reported that they
are engaged in the provision of incumbent local exchange services. Of
these 1,303 carriers, an estimated 1,020 have 1,500 or fewer employees
and 283 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 the Commission's action.
10. Competitive LECs, Competitive Access Providers (CAPs),
``Shared-Tenant Service Providers,'' and ``Other Local Service
Providers.'' Neither the Commission nor the SBA has developed a small
business size standard specifically for these service providers. The
appropriate size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business
is small if it has 1,500 or fewer employees. According to Commission
data, 859 carriers have reported that they are engaged in the provision
of either competitive access provider services or competitive LEC
services. Of these 859 carriers, an estimated 741 have 1,500 or fewer
employees and 118 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, 44 carriers have reported that they are ``Other Local
Service Providers.'' Of the 44, an estimated 43 have 1,500 or fewer
employees and one has more than 1,500 employees. Consequently, the
Commission estimates that most providers of competitive local exchange
service, competitive access providers, ``Shared-Tenant Service
Providers,'' and ``Other Local Service Providers'' are small entities.
11. 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. According to Commission data, 184 carriers have reported
that they are engaged in the provision of local resale services. Of
these, an estimated 181 have 1,500 or fewer employees and three have
more than 1,500 employees. Consequently, the Commission estimates that
the majority of local resellers are small entities that may be affected
by the Commission's action.
12. 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. According to Commission data, 881 carriers have reported
that they are engaged in the provision of toll resale services. Of
these, an estimated 853 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
the Commission's action.
13. Payphone Service Providers (PSPs). Neither the Commission nor
the
[[Page 9511]]
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. According to Commission data, 657 carriers have reported
that they are engaged in the provision of payphone services. Of these,
an estimated 653 have 1,500 or fewer employees and four have more than
1,500 employees. Consequently, the Commission estimates that the
majority of payphone service providers are small entities that may be
affected by the Commission's action.
14. 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. According to Commission data, 330 carriers have
reported that they are engaged in the provision of interexchange
service. Of these, an estimated 309 have 1,500 or fewer employees and
21 have more than 1,500 employees. Consequently, the Commission
estimates that the majority of IXCs are small entities that may be
affected by the Commission's action.
15. 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. According to Commission data, 23 carriers have reported that
they are engaged in the provision of operator services. Of these, an
estimated 22 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 the Commission's
action.
16. 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.
According to Commission data, 104 carriers have reported that they are
engaged in the provision of prepaid calling cards. Of these, 102 are
estimated to have 1,500 or fewer employees and two have more than 1,500
employees. Consequently, the Commission estimates that all or the
majority of prepaid calling card providers are small entities that may
be affected by the Commission's action.
17. 800 and 800-Like Service Subscribers. These toll-free services
fall within the broad economic census category of Telecommunications
Resellers. This category ``comprises establishments engaged in
purchasing access and network capacity from owners and operators of
telecommunications networks and reselling wired and wireless
telecommunications services (except satellite) to businesses and
households. Establishments in this industry resell telecommunications;
they do not operate transmission facilities and infrastructure.'' The
SBA has developed a small business size standard for this category,
which is: all such firms having 1,500 or fewer employees. Census Bureau
data for 2002 show that there were 1,646 firms in this category that
operated for the entire year. Of this total, 1,642 firms had employment
of 999 or fewer employees, and four firms had employment of 1,000
employees or more. Thus, the majority of these firms can be considered
small. Additionally, it may be helpful to know the total numbers of
telephone numbers assigned in these services. Commission data show
that, as of June 2006, the total number of 800 numbers assigned was
7,647,941, the total number of 888 numbers assigned was 5,318,667, the
total number of 877 numbers assigned was 4,431,162, and the total
number of 866 numbers assigned was 6,008,976.
b. International Service Providers
18. The Commission has not developed a small business size standard
specifically for providers of international service. The appropriate
size standards under SBA rules are for the two broad census categories
of ``Satellite Telecommunications'' and ``Other Telecommunications.''
Under both categories, such a business is small if it has $13.5 million
or less in average annual receipts.
19. The first category of Satellite Telecommunications ``comprises
establishments primarily engaged in providing point-to-point
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.'' For this category, Census
Bureau data for 2002 show that there were a total of 371 firms that
operated for the entire year. Of this total, 307 firms had annual
receipts of under $10 million, and 26 firms had receipts of $10 million
to $24,999,999. Consequently, the Commission estimates that the
majority of Satellite Telecommunications firms are small entities that
might be affected by the Commission's action.
20. The second category of Other Telecommunications ``comprises
establishments primarily engaged in (1) providing specialized
telecommunications applications, such as satellite tracking,
communications telemetry, and radar station operations; or (2)
providing satellite terminal stations and associated facilities
operationally connected with one or more terrestrial communications
systems and capable of transmitting telecommunications to or receiving
telecommunications from satellite systems.'' For this category, Census
Bureau data for 2002 show that there were a total of 332 firms that
operated for the entire year. Of this total, 259 firms had annual
receipts of under $10 million and 15 firms had annual receipts of $10
million to $24,999,999. Consequently, the Commission estimates that the
majority of Other Telecommunications firms are small entities that
might be affected by the Commission's action.
c. Wireless Telecommunications Service Providers
21. Below, for those services subject to auctions, the Commission
notes that, as a general matter, the number of winning bidders that
qualify as small businesses at the close of 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.
22. Wireless Service Providers. The SBA has developed a small
business size standard for wireless firms within the two broad economic
census categories of ``Paging'' and ``Cellular and Other Wireless
Telecommunications.'' Under both SBA categories, a wireless business is
small if it has 1,500 or fewer employees. For the census category of
Paging, Census Bureau data for 2002 show that there were 807 firms in
this category that operated for the entire year. Of this total, 804
firms had employment of 999 or fewer employees, and three firms had
employment of 1,000 employees or more. Thus, under this category and
associated small business size standard, the majority of
[[Page 9512]]
firms can be considered small. For the census category of Cellular and
Other Wireless Telecommunications, Census Bureau data for 2002 show
that there were 1,397 firms in this category that operated for the
entire year. Of this total, 1,378 firms had employment of 999 or fewer
employees, and 19 firms had employment of 1,000 employees or more.
Thus, under this second category and size standard, the majority of
firms can, again, be considered small.
23. Cellular Licensees. The SBA has developed a small business size
standard for wireless firms within the broad economic census category
``Cellular and Other Wireless Telecommunications.'' Under this SBA
category, a wireless business is small if it has 1,500 or fewer
employees. For the census category of Cellular and Other Wireless
Telecommunications, Census Bureau data for 2002 show that there were
1,397 firms in this category that operated for the entire year. Of this
total, 1,378 firms had employment of 999 or fewer employees, and 19
firms had employment of 1,000 employees or more. Thus, under this
category and size standard, the majority of firms can be considered
small. Also, according to Commission data, 437 carriers reported that
they were engaged in the provision of cellular service, Personal
Communications Service (PCS), or Specialized Mobile Radio (SMR)
Telephony services, which are placed together in the data. The
Commission has estimated that 260 of these are small under the SBA
small business size standard.
24. Paging. The SBA has developed a small business size standard
for the broad economic census category of ``Paging.'' Under this
category, the SBA deems a wireless business to be small if it has 1,500
or fewer employees. Census Bureau data for 2002 show that there were
807 firms in this category that operated for the entire year. Of this
total, 804 firms had employment of 999 or fewer employees, and three
firms had employment of 1,000 employees or more. In addition, according
to Commission data, 365 carriers have reported that they are engaged in
the provision of ``Paging and Messaging Service.'' Of this total, the
Commission estimates that 360 have 1,500 or fewer employees, and five
have more than 1,500 employees. Thus, in this category the majority of
firms can be considered small.
25. The Commission also notes that, in the Paging Second Report and
Order (62 FR 11616, Mar. 12, 1997), 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. In this context, 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. The SBA has approved this definition. An auction of
Metropolitan Economic Area (MEA) licenses commenced on February 24,
2000, and closed on March 2, 2000. Of the 2,499 licenses auctioned, 985
were sold. Fifty-seven companies claiming small business status won 440
licenses. An auction of MEA and Economic Area (EA) licenses commenced
on October 30, 2001, and closed on December 5, 2001. Of the 15,514
licenses auctioned, 5,323 were sold. 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 commenced on May 13, 2003, and
closed on May 28, 2003. Seventy-seven bidders claiming small or very
small business status won 2,093 licenses. The Commission also notes
that, currently, there are approximately 74,000 Common Carrier Paging
licenses.
26. Wireless Telephony. Wireless telephony includes cellular,
personal communications services (PCS), and specialized mobile radio
(SMR) telephony carriers. As noted earlier, the SBA has developed a
small business size standard for ``Cellular and Other Wireless
Telecommunications'' services. Under that SBA small business size
standard, a business is small if it has 1,500 or fewer employees.
According to Commission data, 432 carriers reported that they were
engaged in the provision of wireless telephony. The Commission has
estimated that 221 of these are small under the SBA small business size
standard.
27. Broadband Personal Communications Service. The broadband
Personal Communications Service (PCS) spectrum is divided into six
frequency blocks designated A through F, and the Commission has held
auctions for each block. The Commission defined ``small entity'' for
Blocks C and F as an entity that has average gross revenues of $40
million or less in the three previous calendar years. For Block F, an
additional classification for ``very small business'' was added and is
defined as an entity that, together with its affiliates, has average
gross revenues of not more than $15 million for the preceding three
calendar years.'' These standards defining ``small entity'' in the
context of broadband PCS auctions have been approved by the SBA. 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 licenses for Blocks D, E, and F. On March 23,
1999, the Commission re-auctioned 347 C, D, E, and F Block licenses.
There were 48 small business winning bidders. On January 26, 2001, the
Commission completed the auction of 422 C and F Broadband PCS licenses
in Auction No. 35. Of the 35 winning bidders in this auction, 29
qualified as ``small'' or ``very small'' businesses. 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.
28. Narrowband Personal Communications Services. The Commission
held an auction for Narrowband PCS licenses that commenced on July 25,
1994, and closed on July 29, 1994. A second auction commenced on
October 26, 1994 and closed on November 8, 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. Through these auctions, the Commission awarded a total
of 41 licenses, 11 of which were obtained by four small businesses. 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 (65 FR 35875,
Jun. 6, 2000). A ``small business'' is an entity that, together with
affiliates and controlling interests, has average gross revenues for
the three preceding years of not more than $40 million. A ``very small
business'' is an entity that, together with affiliates and controlling
interests, has average gross revenues for the three preceding years of
not more than $15 million. The SBA has approved these small business
size standards. A third auction commenced on October 3, 2001 and closed
on October 16, 2001. Here, five bidders won 317 (Metropolitan Trading
Areas and nationwide) licenses. Three of these claimed status as a
small or very small entity and won 311 licenses.
29. Rural Radiotelephone Service. The Commission has not adopted a
size standard for small businesses specific to the Rural Radiotelephone
Service. A significant subset of the Rural
[[Page 9513]]
Radiotelephone Service is the Basic Exchange Telephone Radio System
(BETRS). The Commission uses the SBA's small business size standard
applicable to ``Cellular and Other Wireless Telecommunications,'' i.e.,
an entity employing no more than 1,500 persons. 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 the rules and
policies adopted herein.
30. Air-Ground Radiotelephone Service. The Commission has not
adopted a small business size standard specific to the Air-Ground
Radiotelephone Service. The Commission will use SBA's small business
size standard applicable to ``Cellular and Other Wireless
Telecommunications,'' i.e., an entity employing no more than 1,500
persons. There are approximately 100 licensees in the Air-Ground
Radiotelephone Service, and the Commission estimates that almost all of
them qualify as small under the SBA small business size standard.
31. Offshore Radiotelephone Service. This service operates on
several UHF television broadcast channels that are not used for
television broadcasting in the coastal areas of states bordering the
Gulf of Mexico. There are presently approximately 55 licensees in this
service. The Commission is unable to estimate at this time the number
of licensees that would qualify as small under the SBA's small business
size standard for ``Cellular and Other Wireless Telecommunications''
services. Under that SBA small business size standard, a business is
small if it has 1,500 or fewer employees.
2. Cable and OVS Operators
32. 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.'' 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
the Commission 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. 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. 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. Thus, the majority of
these firms can be considered small.
33. Cable Companies and Systems. The Commission has also developed
its own small business size standards, for the purpose of cable rate
regulation. Under the Commission's rules, a ``small cable company'' is
one serving 400,000 or fewer subscribers, nationwide. Industry data
indicate that, of 1,076 cable operators nationwide, all but eleven are
small under this size standard. In addition, under the Commission's
rules, a ``small system'' is a cable system serving 15,000 or fewer
subscribers. Industry data indicate that, of 7,208 systems nationwide,
6,139 systems have under 10,000 subscribers, and an additional 379
systems have 10,000-19,999 subscribers. Thus, under this second size
standard, most cable systems are small.
34. Cable System Operators. The Communications Act of 1934, as
amended, also contains a size standard for small cable system
operators, which is ``a cable operator that, directly or through an
affiliate, serves in the aggregate fewer than 1 percent of all
subscribers in the United States and is not affiliated with any entity
or entities whose gross annual revenues in the aggregate exceed
$250,000,000.'' The Commission has determined that an operator serving
fewer than 677,000 subscribers shall be deemed a small operator, if its
annual revenues, when combined with the total annual revenues of all
its affiliates, do not exceed $250 million in the aggregate. Industry
data indicate that, of 1,076 cable operators nationwide, all but ten
are small under this size standard. The Commission notes that it
neither requests nor collects information on whether cable system
operators are affiliated with entities whose gross annual revenues
exceed $250 million, and therefore it is unable to estimate more
accurately the number of cable system operators that would qualify as
small under this size standard.
35. Open Video Systems (OVS). In 1996, Congress established the
open video system (OVS) framework, one of four statutorily recognized
options for the provision of video programming services by local
exchange carriers (LECs). The OVS framework provides opportunities for
the distribution of video programming other than through cable systems.
Because OVS operators provide subscription services, OVS falls within
the SBA small business size standard of Cable and Other Program
Distribution Services, which consists of such entities having $13.5
million or less in annual receipts. The Commission has certified 25 OVS
operators, with some now providing service. Broadband service providers
(BSPs) are currently the only significant holders of OVS certifications
or local OVS franchises. As of June, 2005, BSPs served approximately
1.4 million subscribers, representing 1.5 percent of all MVPD
households. Affiliates of Residential Communications Network, Inc.
(RCN), which serves about 371,000 subscribers as of June, 2005, is
currently the largest BSP and 14th largest MVPD. RCN received approval
to operate OVS systems in New York City, Boston, Washington, DC and
other areas. The Commission does not have financial information
regarding the entities authorized to provide OVS, some of which may not
yet be operational. The Commission thus believes that at least some of
the OVS operators may qualify as small entities.
3. Internet Service Providers
36. Internet Service Providers. The SBA has developed a small
business size standard for Internet Service Providers (ISPs). ISPs
``provide clients access to the Internet and generally provide related
services such as web hosting, web page designing, and hardware or
software consulting related to Internet connectivity.'' Under the SBA
size standard, such a business is small if it has average annual
receipts of $23 million or less. According to Census Bureau data for
2002, there were 2,529 firms in this category that operated for the
entire year. Of these, 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. Consequently, the Commission estimates that the
majority of these firms are small entities that may be affected by the
Commission's action.
37. All Other Information Services. ``This industry comprises
establishments primarily engaged in providing other information
services (except new syndicates and libraries and archives).'' The SBA
has developed a small business size standard for this category; that
size standard is $6.5 million or less in average annual receipts.
According to Census Bureau
[[Page 9514]]
data for 2002, there were 155 firms in this category that operated for
the entire year. Of these, 138 had annual receipts of under $5 million,
and an additional four firms had receipts of between $5 million and
$9,999,999. Consequently, the Commission estimates that the majority of
these firms are small entities that may be affected by the Commission's
action.
4. Equipment Manufacturers
38. SBA small business size standards are given in terms of
``firms.'' Census Bureau data concerning computer manufacturers, on the
other hand, are given in terms of ``establishments.'' The Commission
notes that the number of ``establishments'' is a less helpful indicator
of small business prevalence in this context than would be the number
of ``firms'' or ``companies,'' because the latter take into account the
concept of common ownership or control. Any single physical location
for an entity is an establishment, even though that location may be
owned by a different establishment. Thus, the census numbers provided
below may reflect inflated numbers of businesses in the given category,
including the numbers of small businesses.
39. Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. The Census Bureau defines this category as
follows: ``This industry comprises establishments primarily engaged in
manufacturing radio and television broadcast and wireless
communications equipment. Examples of products made by these
establishments are: Transmitting and receiving antennas, cable
television equipment, GPS equipment, pagers, cellular phones, mobile
communications equipment, and radio and television studio and
broadcasting equipment.'' The SBA has developed a small business size
standard for Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing, which is: All such firms having
750 or fewer employees. According to Census Bureau data for 2002, there
were a total of 1,041 establishments in this category that operated for
the entire year. Of this total, 1,010 had employment of under 500, and
an additional 13 had employment of 500 to 999. Thus, under this size
standard, the majority of firms can be considered small.
40. Telephone Apparatus Manufacturing. The Census Bureau defines
this category as follows: ``This industry comprises establishments
primarily engaged in manufacturing wire telephone and data
communications equipment. These products may be standalone or board-
level components of a larger system. Examples of products made by these
establishments are central office switching equipment, cordless
telephones (except cellular), PBX equipment, telephones, telephone
answering machines, LAN modems, multi-user modems, and other data
communications equipment, such as bridges, routers, and gateways.'' The
SBA has developed a small business size standard for Telephone
Apparatus Manufacturing, which is: All such firms having 1,000 or fewer
employees. According to Census Bureau data for 2002, there were a total
of 518 establishments in this category that operated for the entire
year. Of this total, 511 had employment of under 1,000, and an
additional 7 had employment of 1,000 to 2,499. Thus, under this size
standard, the majority of firms can be considered small.
41. Semiconductor and Related Device Manufacturing. Examples of
manufactured devices in this category include ``integrated circuits,
memory chips, microprocessors, diodes, transistors, solar cells and
other optoelectronic devices.'' The SBA has developed a small business
size standard for this category of manufacturing; that size standard is
500 or fewer employees. According to Census Bureau data, there were
1,032 establishments in this category that operated with payroll during
2002. Of these, 950 had employment of under 500, and 42 establishments
had employment of 500 to 999. Consequently, the Commission estimates
that the majority of these establishments are small entities.
42. Computer Storage Device Manufacturing. These establishments
manufacture ``computer storage devices that allow the storage and
retrieval of data from a phase change, magnetic, optical, or magnetic/
optical media.'' The SBA has developed a small business size standard
for this category of manufacturing; that size standard is 1,000 or
fewer employees. According to Census Bureau data, there were 170
establishments in this category that operated with payroll during 2002.
Of these, 164 had employment of under 500, and five establishments had
employment of 500 to 999. Consequently, the Commission estimates that
the majority of these establishments are small entities.
D. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
43. Should the Commission decide to adopt any further numbering
requirements to benefit customers of telecommunications and
interconnected VoIP service, the associated rules potentially could
modify the reporting and recordkeeping requirements of certain
telecommunications providers and interconnected VoIP service providers.
For example, the Commission seeks comment on whether it should require
interconnected VoIP providers to comply with N11 code assignments.
Additionally, the Commission seeks comment on whether it should adopt a
requirement that carriers identify all errors possible in a given LSR
and describe the basis for rejection when rejecting a port request. The
Commission also tentatively concludes that it should adopt rules
reducing the porting interval for wireline-to-wireline and intermodal
simple port requests, specifically to a 48-hour porting interval, and
seeks comment on whether the Commission should establish time limits on
the porting process for all types of simple port requests or just
certain types of ports. Further, the Commission seeks comment on
whether there are any technical impediments or advances that affect the
overall length of the porting interval such that it should adopt
different porting intervals for particular types of simple ports. These
proposals may impose additional reporting and recordkeeping
requirements on entities. Also, the Commission seeks comment on whether
any of these proposals place burdens on small entities, and whether
alternatives might lessen such burdens while still achieving the goals
of this proceeding. Entities, especially small businesses, are
encouraged to quantify the costs and benefits or any reporting
requirement that may be established in this proceeding.
E. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
44. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include (among others) the following four alternatives: (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
[[Page 9515]]
use of performance, rather than design, standards; and (4) an exemption
from coverage of the rule, or any part thereof, for small entities.
45. The Commission's primary objective is to ensure that that
consumers benefit from LNP. The Commission seeks comment on the
burdens, including those placed on small carriers, associated with
related Commission rules and whether the Commission should adopt
different requirements for small businesses. Specifically, the
Commission seeks comment on the benefits and burdens, including the
burdens on small entities, of requiring interconnected VoIP providers
to comply with N11 code assignments and other numbering requirements.
The Commission also seeks comment on the benefits and burdens,
including the burdens on small entities, of the specific requirements
on the validation process proposed in the Notice and any other such
requirements. Further, the Commission seeks comment on the benefits and
burdens, including the burdens on small entities, of adopting rules
regarding porting intervals for all types of simple port requests.
F. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
46. None.
Initial Paperwork Reduction Act of 1995 Analysis
47. This document does not contain proposed information collection
requirements subject to the Paperwork Reduction Act of 1995, Public Law
104-13. In addition, therefore, it does not contain any proposed
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).
Ordering Clauses
It is ordered that pursuant to the authority contained in sections
1, 4(i), 4(j), 251, and 303(r) of the Communications Act of 1934, as
amended, 47 U.S.C. 151, 154(i)-(j), 251, 303(r), the Notice of Proposed
Rulemaking in WC Docket Nos. 07-243 and 07-244 is adopted.
It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Report and Order, Declaratory Ruling, Order on Remand, and
Notice of Proposed Rulemaking, including the two Final Regulatory
Flexibility Analyses and the Initial Regulatory Flexibility Analysis,
to the Chief Counsel for Advocacy of the Small Business Administration.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E8-3129 Filed 2-20-08; 8:45 am]
BILLING CODE 6712-01-P