[Federal Register Volume 64, Number 136 (Friday, July 16, 1999)]
[Proposed Rules]
[Pages 38396-38405]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-18232]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 20
[WT Docket No. 97-207; FCC 99-137]
Calling Party Pays Service Offering in the Commercial Mobile
Radio Services
AGENCY: Federal Communications Commission.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This document seeks to remove regulatory obstacles to the
offering to consumers of Calling Party Pays (CPP) services by
Commercial Mobile Radio Services (CMRS) providers. CPP allows a CMRS
provider to make available to its subscribers an offering whereby the
party placing the call to a CMRS subscriber pays at least some of the
charges associated with terminating the call, including most
prominently charges for the CMRS airtime. The Commission is issuing
this document to help facilitate the wider availability of CPP, and to
consider possible actions this Commission could take to address several
key issues associated with the offering of CPP service.
DATES: Comments are due on or before August 18, 1999, and reply
comments are due on or before September 8, 1999.
ADDRESSES: Federal Communications Commission, Office of the Secretary,
445 12th Street, S.W., Washington, D.C. 20554.
FOR FURTHER INFORMATION CONTACT: Legal Information: David Siehl, 202-
418-1310; Economic Information: Joseph Levin, 202-418-1310; [TTY: 202-
418-7233].
SUPPLEMENTARY INFORMATION: The following synopsis concerns only the
Notice of Proposed Rulemaking (NPRM) of the Commission's Declaratory
Ruling and Notice of Proposed Rulemaking in WT Docket No. 97-207, FCC
99-137, adopted June 10, 1999, and released July 7, 1999. The synopsis
of the section of the document containing the Declaratory Ruling is
being published separately in the Federal Register. The complete text
of the entire released document is available for inspection and copying
during normal business hours in the FCC Reference Information Center
(Courtyard level), 445 12th Street, S.W., Washington, D.C. 20554, and
also may be purchased from the Commission's copy contractor,
International Transcription Services (ITS, Inc.), (202) 857-3800, 445
12th Street, S.W., CY-B400, Washington, D.C. 20054.
Synopsis of Notice of Proposed Rulemaking
1. The Commission is initiating this NPRM for two fundamental
reasons. First, the availability of CPP as a service offering for
wireless telephone subscribers has the potential to expand wireless
market penetration and minutes of use and, in so doing, offers an
opportunity to provide a near-term competitive alternative to incumbent
local exchange carriers (ILECs) for residential customers. Second, the
Commission believes that there may be obstacles to the widespread
introduction of CPP, and that market forces alone may not eliminate
these obstacles.
2. The Commission finds that CPP could provide several important
tangible benefits to telecommunications consumers in the United States.
One major benefit envisioned is the possibility that CPP could
ultimately lead to wireless services becoming a true competitive
alternative to the local exchange services offered by ILECs,
particularly for residential customers. Another potential benefit is
that CPP could spur competition within the CMRS market by offering
consumers a different and less expensive wireless service option.
3. Many carrier commenters have argued that subcribership to
wireless services would be expected to increase substantially because,
in no longer paying for incoming calls, consumers would have a much
more, valuable service, even at current prices. Independent market
analysts have indicated that CPP would make prepaid wireless services,
a critically important and growing segment of the CMRS market, more
attractive to consumers by eliminating airtime charges for incoming
calls. Because prepaid wireless telephone service is attracting many
new wireless customers from socioeconomic groups that have not
previously subscribed to wireless service, the broad availability of a
prepaid option, in which the subscriber pays only to make calls, would
reinforce the trend to much greater wireless penetration.
4. Many industry analysts and commentators anticipate that CPP is
the catalyst needed to create a significant increase in wireless usage
by U.S. subscribers. First, CMRS subscribers who select CPP would be
much more likely to leave their wireless phones in an activated mode in
order to receive calls because they would not be responsible for paying
the associated charges. Also, because CPP customers would be expected
to be more willing to give out their wireless phone numbers if they did
not have to pay for incoming calls, they would be much more likely to
receive incoming calls. As a result, it is likely that more calling
parties will place calls to wireless subscribers and take advantage of
the opportunity to reach someone who is not tied to one location. The
calling party will have an increased likelihood of being able to
complete a call to a CPP subscriber, as compared to calling a wireless
subscriber with called party pays service. Second, according to these
analysts, to the extent that subscribers are comfortable with paying a
set amount per month for wireless service, CPP will encourage them to
increase the number of calls they make, up to the amount of their
monthly CMRS budget, since they no longer will need to pay for, or
budget for, incoming calls.
5. The Commission would like to update its record on the experience
with CPP and the impacts of it on the use of mobile services in other
countries. The NPRM seeks comment on any recent international
developments, and in addition, on domestic competitive trends that may
be relevant to a CPP service offering in the U.S.
6. In its Notice of Inquiry regarding CPP,\1\ the Commission asked
about possible obstacles to greater availability of this service
option. In summary, the responses indicate three areas that need to be
addressed: (1) technical standards to control leakage; (2) calling
party notification to protect consumers; and (3) arrangements for
reasonably priced billing and collection services. The technical
standards to collect and pass information needed to bill the calling
party for calls to a wireless phone are being developed by an industry
group, based on a working paper developed through Cellular
Telecommunications Industry Association (CTIA) and released in January
1998. There has been no indication in the comments that the Commission
needs to intervene in this process.
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\1\ Calling Party Pays Service Option in the Commercial Mobile
Radio Services, WT Docket No. 97-207, Notice of Inquiry, 62 FR 58700
(Oct. 30, 1997), 12 FCC Rcd 17693 (1997) (Notice of Inquiry).
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7. The NPRM notes based on the record to this point, that it
appears the lack of a nationwide notification has hindered successful
CPP offerings in this country. The record strongly
[[Page 38397]]
supports the conclusion that some effective form of calling party
notification is critically important to avoid consumer confusion with
CMRS provider introduction of CPP offerings. Further, the comments
almost unanimously indicate that without a uniform notification system,
conflicting state notifications would increase consumer confusion about
calls to CPP subscribers if CPP were to be implemented more widely.
Another consequence of conflicting notifications would be increased
costs to wireless carriers in their efforts to provide notifications to
calling parties in different jurisdictions. The Commission believes
that it is essential to develop a uniform notification system, in
cooperation with the states, and seeks comment on what elements that
notification system should contain.
8. A threshold issue concerning notification is whether there
should be a uniform nationwide standard that specifies the manner in
which a CMRS carrier must indicate to a caller that the caller will be
billed for his or her call to the CMRS phone or pager. A second issue
is how to develop and implement such a notification standard,
particularly how we may incorporate the knowledge and concerns of the
states with regard to consumer notification and protection.
9. The Commission agrees with the commenters that a uniform
nationwide notification system is necessary to facilitate the
implementation of CPP. The NPRM finds that such a notification would
significantly alleviate confusion on the part of calling parties by
providing them the capability to make an informed decision on whether
to proceed with completing the call. In addition, as several commenters
submit, a uniform nationwide standard for notification announcement
would likely minimize the cost to wireless carriers of providing a
notification, especially where they service multi-state areas. The NPRM
seeks comment on what additional consumer protection measures states
could take that would be consistent with a uniform notification
announcement and within the scope of their authority to protect
consumers.
10. The NPRM concludes that the Commission has jurisdiction to
implement a uniform nationwide notification under sections 201(b) and
section 332(c)(3)(A) of the Act.\2\ In addition, the Commission
recognizes the traditional role of the states in the areas of consumer
notification and protection. Indeed section 332(c)(3)(A) provides that
States may regulate ``other terms and conditions'' of any CMRS
service.\3\
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\2\ 47 U.S.C. 201(b), 332(c)(3)(A).
\3\ See 47 U.S.C. 332(c)(3)(A); see also House Report at 261
(explaining that other ``terms and conditions'' of CMRS include such
matters as customer billing information and practices, billing
disputes and ``other consumer protection matters.'').
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11. The Communications Act establishes as a primary mission of the
Commission regulation of interstate and foreign communication so as to
make available to all the people of the United States a rapid,
efficient Nation-wide, and world-wide wire and radio communications
service.\4\ The NPRM also notes that section 201(b) declares unlawful
any unjust and unreasonable practices, which clearly governs CMRS calls
that originate and terminate in different states.\5\ Based on its
determination in the Declaratory Ruling that CPP is a form of CMRS, the
Commission believes that it may have authority under section 332 of the
Act to establish uniform rules in furtherance of our statutory mandate
to ``establish a federal regulatory framework to govern the offering of
all [CMRS].'' \6\ In the alternative, the NPRM seeks comment on other
jurisdictional grounds for establishing a nationwide system for CPP
notification, and on the extent to which the Commission should prohibit
inconsistent or conflicting state notification regulations.\7\
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\4\ 47 U.S.C. 151.
\5\ 47 U.S.C. 201(b).
\6\ H.R. Conf. Rep. No. 103-213 at 490 (1993). See CTIA Comments
to NOI at 20, n. 42 (referring to this report in arguing for a
nationwide notification, and also, referring to the Senate version,
Sec. 402(13)).
\7\ For example, CITA contends that ``the Commission retains
jurisdiction to ensure that inconsistent State regulation does not
thwart uniformity of nationwide CPP notification mechanisms.'' See
CTIA Comments at NOI at 17-18 n.37 (citing Louisiana Public Service
Commission v. FCC, 476 U.S. 355 (1986)).
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12. The Commission further recognizes, however, as the record
reflects, that the states have a legitimate interest, pursuant to the
``other terms and conditions'' exception provided by section
332(c)(3)(A),\8\ to regulate matters concerning aspects of consumer
protection involved, e.g., in customer billing practices.\9\
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\8\ See 47 U.S.C. 332(C)(3)(A).
\9\ See House Report at 261.
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13. The Commission believes that a process should be initiated that
considers the role and interest of the states in consumer protection.
The NPRM invites comment on how the Commission might tailor a
nationwide notification system that would provide the states a way,
consistent with statutory authority, to protect intrastate interests in
a manner that would not conflict with the nationwide benefits of a
uniform notification system for CPP. The NPRM directs the Wireless
Telecommunication Bureau to work actively with the states, through the
National Association of Regulatory Utility Commissioners (NARUC), as
well as with interested wireless industry and consumer representatives,
to seek to develop a consensus implementation of our calling party
notification proposal.
14. The Commission seeks to ensure calling party notification that
protects all consumers, including those with disabilities, that
reflects the knowledge and experience of the states, and that can be
implemented on a cost-effective basis.
15. The NPRM proposes that the calling party notification for CPP
should consist of a verbal message provided by the CMRS provider to the
calling party. Because CPP will represent a significant change to
consumers calling a wireless telephone or pager, the Commission
believes that initially it is important that notification include the
following elements:
(1) Notice that the calling party is making a call to a wireless
phone subscriber that has chosen the CPP option, and that the calling
party therefore will be responsible for payment of airtime charges.
(2) Identification of the CMRS provider.
(3) The per minute rate, or other rates, that the caller will be
charged by the CMRS provider.
(4) An opportunity to terminate the call prior to incurring any
charges.
16. Although the Commission acknowledges that specific rate
information may be superfluous in certain situations, the Commission
tentatively concludes that rate information would be considered
relevant by a substantial majority of calling parties. The rate
information would have to include all of the additional charges billed
by the CMRS provider to the calling party for the call. For example the
Commission understands that CPP offerings envisioned by CMRS providers
would include per minute charges for terminating airtime. It is
possible that a CMRS providers may also include other charges now paid
by the CMRS subscriber receiving the call, for instance, for roaming or
for long-distance service. If so, the notification must include all of
the per minute and other charges to be billed to the calling party. The
NPRM seeks comment on this element in a proposed notification system.
17. The Commission seeks comment on the desirability of moving to a
simpler, more streamlined notification
[[Page 38398]]
system that would not include rate information, after consumers have
become accustomed to CPP and are aware of the additional charges
involved. The NPRM in addition seeks comment on whether our proposed
method of notification, as well as the simpler version described above,
will be accessible to people with disabilities. The NPRM also requests
proposed solutions to any problems that are identified.
18. The NPRM also seeks comment on other options for ensuring that
calling parties have adequate notification. There are a number of
notification options being used in states, such as Arizona, where CPP
is now being offered. Some carriers rely on 1+ dialing as the means to
indicate to the caller that a toll is involved. Other options include
the use of dedicated NXX \10\ codes for CPP subscribers and the use of
special numbers with a 500 Service Area Code (SAC) to identify the
number as a CPP call. The Commission seeks comment on what additional
notification measures states might be able to adopt that would not
conflict with uniform nationwide notification.
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\10\ NXX is the three-digit number identifying the central
office. See 47 CFR 52.7(c).
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19. The Commission recognizes that businesses need to restrict the
ability of telephone users to make various types of billable calls from
certain lines (e.g., toll restricted lines on private branch exchanges
(PBXs)). The NPRM asks for comment on the number of companies and other
organizations that use PBXs or Centrex and could be adversely affected
by the broader implementation of CPP, as well as projections of the
magnitude of potential losses they might incur because of the inability
to identify calls beings placed from their systems to CPP subscribers.
20. The NPRM also seeks comment on the ways businesses and other
organizations can meet the need for restricted access, particularly if
the telecommunications industry moves to more widespread number
portability. In light of the number portability, number pooling, and
other signaling system based solutions, the NPRM seeks comments on the
viability of signaling solutions, perhaps combined with line class
codes.\11\ Commenters should address the viability of proposed
solutions and whether the solutions can be implemented with current
network capabilities. The NPRM seeks comment on whether establishing
service codes would sufficiently address these issues. The Commission
also seeks comment on the impact on business users, who use restricted
access, if dedicated service codes were not established.
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\11\ A line class code is a code used at the PBX or Centrex
switch to restrict a specific number within the PBX or Centrex
system from making a particular type of call.
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21. The NPRM seeks comment on the desirability of establishing a
dedicated service code or codes to assign to CPP subscribers so that
callers may more readily identify a CPP call. The NPRM also seeks
comment on whether it is necessary or desirable to treat the
notification for paging the same as mobile telephony. In particular,
the use of a distinct code would appear to be unworkable in the context
of the Source One approach to CPP. Therefore, the NPRM solicits
comments that address the best ways of balancing the need for a uniform
CPP notification approach using special numbering codes, with the need
to work within the special operating constraints of paging carriers.
Although such specially assigned telephone numbers could be used as the
sole means of notifying consumers that they are calling a CPP number,
the Commission tentatively concludes that if special numbers are to be
established, they should serve to supplement the above notification
system, not replace it. Comment is sought on this tentative conclusion.
Finally, the NPRM seeks comment on the effect of calling party
notification through assignment of numbering codes on number exhaust
and number portability, and on possible means to mitigate any
significant negative effects.
22. The NPRM finds that the Commission has jurisdiction to
establish calling party notification through dedicated numbering codes
pursuant to section 251(e)(1), which confers exclusive jurisdiction on
the Commission over the North American Numbering Plan as it pertains to
the United States, along with the power to delegate to the states
certain portions of this jurisdiction.\12\ The Notice of Inquiry record
indicates that the Commission could rely on this provision if it were
to implement a CPP notification scheme based on ``1+dialing'' or use of
specialized area codes. The NPRM tentatively concludes that section 251
of the Act does provide a jurisdictional basis to implement such a
method and seeks comment on this tentative conclusion.
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\12\ Section 251(e)(1) states that ``[t]he Commission shall have
exclusive jurisdiction over those portions of the North American
Numbering Plan that pertains to the United States. * * *'' 47 U.S.C.
251(e)(1).
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23. The Commission notes that in a 1997 decision regarding ``casual
calling'' it suggested that carriers have reasonable options other than
tariffs to establish contractual relationships with casual callers that
would legally obligate such callers to pay for their services, and that
providing the caller the rates, terms, and conditions prior to the
completion of a call would establish an enforceable contract between
the caller and the carrier.\13\ The Commission believes that these same
principles should apply in the context of CPP.
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\13\ See Policy and Rules Concerning the Interstate,
Interexchange Marketplace, CC Docket No. 96-61, Order on
Reconsideration, 62 FR 59583 (Nov. 4, 1997), 12 FCC Rcd 15014,
15026-27 n. 74 (para. 18) (1997).
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24. The NPRM seeks comment on whether the proposed notification
method ought to be sufficient to establish an ``implied in fact''
contractual arrangement between the CMRS provider and the calling
party, and, if not, what else may be necessary.
25. Furthermore, the NPRM urges commenters to discuss whether
market conditions exist or are likely to develop in the United States
that would exert competitive pressure on CPP rates to be charged a
calling party by a CMRS carrier. Under this approach, the Commission
would defer regulatory intervention until there is clear evidence that
Commission action is necessary to resolve rate issues. In addition, the
NPRM seeks comment on any other approaches that would help safeguard
consumers who wish to place calls to CPP subscribers. In this regard,
the NPRM notes that the Commission's Rules require that the rates
charged for calls placed through TRS be no greater than the rates
charged for a functionally equivalent call that does not use TRS
facilities.\14\ The requests comment on whether methods are needed to
ensure that the CPP rates charged for voice and TTY calls placed
through TRS centers do not exceed those that do not use such
facilities.
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\14\ Section 64.604(c)(3) of the Commission's Rules, 47 CFR
64.604(c)(3).
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Relationship Between LEC Billing and Collection Services and CPP
Offerings
26. The record contains a variety of views on the need for the
Commission to mandate LEC billing and collection. On the other hand,
some LECs and wireless carriers submit that there is no evidence yet of
a strong market demand for CPP, and that the Commission should let the
market operate. In considering the regulatory treatment of billing and
collection services, the Commission observes that it has generally
declined to regulate the provision of billing and collection services
unless regulation is needed to protect competition. In 1983, shortly
after the Modified Final Judgment, the Commission regulated billing and
[[Page 38399]]
collection services by establishing a separate access charge for
billing and collection provided to IXCs and requiring exchange carriers
that provided billing and collection services to one IXC to provide
such services to all IXCs. In 1986, however, the Commission de-tariffed
billing and collection services provided by LECs and found regulation
of such services to be unnecessary. In 1992, the Commission clarified
that billing and collection service was a communications service within
the meaning of section 3(a) of the Act,\15\ but that it was not subject
to regulation under Title II because it was not a ``common carrier''
service (although it could be regulated under the Commission's
ancillary jurisdiction under Title I of the Act). In 1993, the
Commission refused to require IXCs to provide billing and collection
services to providers of 900 services.
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\15\ 47 U.S.C. 3(a) (current version at 47 U.S.C. 3(51) (1996)).
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27. In some instances where the provision of billing and collection
services has not been required, there have been nondiscrimination
requirements. For instance, in the 1996 Telecommunications Act,
Congress added section 272 \16\ requiring Bell Operating Companies
(BOCs) who wished to provide certain types of services to provide them
through separate affiliates. Section 272(c)(1) of the Act provides that
BOCs may not discriminate between such affiliates and ``any other
entity in the provision or procurement of goods, services, facilities,
and information, or in the establishment of standards. * * *'' \17\ In
implementing that section, we held that to the extent a BOC provides
billing and collection services to an affiliate, such services were
subject to the non-discrimination requirements of section
272(c)(1).\18\ The Commission's Rules also defined the term ``entity''
as including ``telecommunications carriers, ISPs, and manufacturers.''
\19\
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\16\ 47 U.S.C. 272(a).
\17\ 47 U.S.C. 272(c)(1).
\18\ Implementation of Non-Accounting Safeguards of Sections 271
and 272 of the Communications Act of 1934, as amended, CC Docket No.
96-149, First Report and Order and Further Notice of Proposed
Rulemaking, 62 FR 2991 (Jan. 21, 1997), 11 FCC Rcd 21905, 22007-
22008 (paras. 216-219) (1996).
\19\ Id.
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28. At this point, the record is not sufficient to decide, as a
policy matter, whether the Commission should require CPP-related LEC
billing and collection. The NPRM seeks comment on whether such billing
and collection is needed for the regional or nationwide offering of
CPP, and, if so, whether that need reflects market failure or some
anti-competitive conduct. In addition, the NPRM asks whether the
offering of CPP would be cost-prohibitive in the absence of incumbent
LEC billing and collection services. The Commission also seeks specific
comment on the availability of alternatives, such as third party
billing through credit card companies or clearinghouses. The NPRM notes
that with technological developments, CMRS carriers interested in
providing a CPP service option may want to develop their own
capabilities to rate and record billing information, with LECs making
use of that information if the LECs were to bill LEC customers
directly. The NPRM seeks comment on these developments and their impact
on implementing CPP, particularly in regard to LEC billing and
collection, third party billing, and CMRS carrier billing.
29. The NPRM seeks comment on whether the Commission should mandate
that LECs provide to CMRS providers billing information sufficient for
the CMRS provider or third parties to bill calling parties for CPP-
related calls or that LECs provide any CPP-related billing and
collection on a nondiscriminatory basis.
30. The NPRM seeks comment on whether calls placed through
Telecommunications Relay Service (TRS) facilities, including those from
pay telephones, or calls between two text telephone (TTY) users,
implicate any additional billing and collection issues that may need to
be addressed in this proceeding. Commenters are requested to be as
specific as possible about the nature of the TRS and/or TTY related
problems in billing and collection and should propose solutions. The
NPRM also solicits comment on any other problems or issues that may
affect consumers, including those with disabilities, if CPP were to be
implemented on a broader scale by wireless carriers in the United
States.
Potential Jurisdictional Bases for Commission Action
31. Assuming that the Commission concludes in this proceeding as a
policy matter that requires the provision of LEC billing and collection
for CPP in the U.S., the NPRM seeks comment concerning our statutory
authority to promulgate such a requirement. Specifically, the NPRM
seeks comment on several potential sources of jurisdiction raised by
the commenters in response to the Notice of Inquiry.
32. The NPRM seeks comment on whether the statutory objectives of
the Act support the assertion of ancillary jurisdiction here, and on
AirTouch's contentions that the exercise of jurisdiction over LEC
billing and collection in the CPP context is distinguishable from other
instances where the Commission has declined to exercise ancillary
jurisdiction over LEC billing and collection.\20\ Finally, the NPRM
seeks comment on whether other provisions of the Act, such as section
332,\21\ provide an independent jurisdictional basis for a federal
requirement regarding CPP-related billing and collection.
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\20\ 47 U.S.C. 4(i).
\21\ 47 U.S.C. 332.
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33. The NPRM also seeks comment on whether we have jurisdiction
under any of the theories described above over the provision of billing
information by LECs to support CPP-related billing and collection by
others. Some commenters argue that in the case of ILECs, we have
authority to require the provision of billing information under section
251(c)(3) of the Act, which requires that ILECs provide
nondiscriminatory access to ``network elements'' on an unbundled
basis.\22\ These commenters argue that billing and collection
information constitutes a unbundled network element (UNE) that is
subject to this statutory requirement. The NPRM seeks comment on this
view, particularly in light of the fact that the definition of
``network element'' in section 3(29) of the Act includes ``information
sufficient for billing and collection.'' \23\ The Commission seeks
comment on whether such information would need to be unbundled under
the statutory ``necessary'' and ``impair'' standard. The Commission
plans to apply the criteria developed on remand from the Supreme
Court's decision in Iowa Utilities Board.\24\
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\22\ 47 U.S.C. 251(c)(3).
\23\ 47 U.S.C. 153(29).
\24\ AT&T Corp. v. Iowa Utils. Bd., 119 S. Ct. 721 (1999).
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34. Assuming that a LEC is providing CPP-related billing and
collection services or information, the NPRM also seeks comment on
whether we have jurisdiction to require that LEC to provide such
services or information on a reasonable, non-discriminatory basis.
Assuming that the Commission is to determine that CPP-related billing
information qualifies as a UNE subject to section 251(c)(3), the Act
requires that incumbent LECs provide nondiscriminatory access to UNEs
``on rates, terms, and conditions that are just, reasonable, and
nondiscriminatory.''\25\ In view of this requirement, the NPRM seeks
comment on whether, if an ILEC
[[Page 38400]]
elects to provide billing and collection for CPP for any CMRS carrier,
the ILEC must offer the same services on a reasonable, non-
discriminatory basis to all CMRS carriers who request such services.
Further, the NPRM invites comment on whether the Commission has
authority, based on ancillary jurisdiction or any other statutory
provisions, to impose similar non-discrimination requirements with
respect to CPP-related billing information on incumbent LECs and on
non-incumbent LECs, i.e., competitive LECs and LECs serving rural
areas, who are not subject to section 251(c)(3).
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\25\ 47 U.S.C. 251(c)(3).
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35. The NPRM seeks comment on jurisdictional issues relating to
state regulation of LEC CPP-related billing and collection. Under
section 332 of the Act, states are preempted from regulating entry by
CMRS providers. Similarly, section 253(a) prohibits any state or local
statute or regulation that constitutes a barrier to entry to any
telecommunications service provider, although section 253(b) preserves
intact state regulatory authority to ``safeguard the rights of
consumers.'' \26\ Some commenters contend that if a state were to
prohibit LECs from providing billing and collection services in support
of CPP, this would effectively preclude CMRS carriers from providing
CPP within the state, and would therefore constitute de facto entry
regulation subject to preemption under section 332 or a barrier to
entry under section 253. The NPRM seeks comment on this view. In
addition, some commenters point out that the California PUC has
recently denied a petition by AirTouch to compel Pacific Bell to
provide billing and collection for a CPP trial based on Pacific Bell's
tariff for billing and collection of wireless services. The denial was
based on language in a California PUC decision that prohibits a LEC
from billing its wireline customers at wireless rates for calls placed
to wireless phones. The NPRM seeks comment on whether this decision
raises jurisdictional issues that the Commission should address.
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\26\ 47 U.S.C. 253(a)-(b).
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CPP, Interconnection, and Reciprocal Compensation
36. The Notice of Inquiry also sought comment regarding whether the
implementation of reciprocal compensation for LEC-CMRS interconnection
requirements provides a sufficient market incentive for CMRS carriers
not to charge their subscribers for incoming calls. The Notice of
Inquiry noted that CPP and reciprocal compensation may address a
similar issue regarding the means by which a CMRS provider recoups the
cost of completing a call that does not originate on the CMRS network.
The Commission asked for comment regarding whether reciprocal
compensation would eliminate or reduce the need for CPP.
37. The Commission agrees with parties who contend that, under
existing interconnection agreement, compensation for transport and
termination generally does not cover the costs of terminating airtime.
As a result, the Commission does not believe that the availability of
reciprocal compensation renders moot any issues regarding CPP.
38. Some parties contend that, although CPP can be distinguished
from and is not the same thing as reciprocal compensation, CPP-like
service can be offered by expanding existing interconnection
agreements. Sprint Spectrum indicates that implementation of CPP
through interconnection agreements is done in Europe and elsewhere.
Under these agreements, the caller is billed by the LEC based on
published LEC rates for fixed-to-mobile calls. The LEC is solely
entitled to the caller's account and has sole responsibility for bad
debt. The LEC pays the wireless carrier an interconnection charge to
terminate traffic on the wireless network. The interconnection charges
are determined either by regulators or negotiated bilaterally by the
carriers involved. Under the European model, the wireless carrier for
the called party imposes a wireless termination access charge on the
LEC, or the wireless carrier originating the call. The LEC or the
wireless carrier serving the originating caller may, in turn, bill its
customer, the calling party, to recoup the charge (if it so chose).
Such implementation of a CPP service would amount to ``asymmetrical
compensation,'' such that the symmetrical rates between wireline and
wireless carriers for transport and termination under a reciprocal
compensation arrangement would not be operative. With the asymmetrical,
or non-symmetrical, compensation approach, CMRS carriers would not need
to recover their costs with a distinct ``airtime'' charge for use of
the CMRS carriers' network if all of the costs related to completing a
call to a wireless phone are included in the ``asymmetrical'' rate.
39. Thus, the NPRM invites parties generally to comment on these
and any other issues relating to the possible provision of CPP-like
service by CMRS carriers wanting to use an interconnection approach.
The Commission also seeks comment on the impact of such an approach on
LECs, including competitive LECs (CLECs), and upon CMRS (such as
paging) providers.
Administrative Matters
In addition to filing comments with the Secretary, a copy of any
comments on the information collections contained in the Notice of
Proposed Rulemaking (NPRM) should be submitted to David Siehl, Policy
Division, Wireless Telecommunications Bureau, 445 12th Street, S.W.,
Washington, D.C. 20554. Comments may also be filed using the
Commission's Electronic Comment Filing System (ECFS). Comments filed
through the ECFS can be sent as an electronic file via the Internet to
http://www.fcc.gov/e-file/ecfs.html>. Generally, only one copy of an
electronic submission must be filed. In completing the transmittal
screen, commenters should include their full name, Postal Service
mailing address, and a reference to WT Docket No. 97-207. Parties may
also submit an electronic comment by Internet E-Mail. To obtain filing
instructions for E-Mail comments, commenters should send an e-mail to
ecfs@fcc.gov, and should include the following words in the body of the
message, ``get from .''
All relevant and timely comments will be considered by the
Commission before final action is taken in this proceeding. To file
formally in this proceeding, participants must file an original and
five copies of all comments, reply comments, and supporting comments.
If participants want each Commissioner to receive a personal copy of
their comments, an original and nine copies must be filed. Comments and
reply comments will be available for public inspection during regular
business hours in the Commission's Reference Center and through ITS,
Inc., the Commission's duplicating contractor.
For purposes of this proceeding, the Commission waives those
provisions of the rules that require formal comments to be filed on
paper, and encourages parties to file comments electronically.
Electronically filed comments that conform to the guidelines specified
in this summary will be considered part of the record in this
proceeding and accorded the same treatment as comments filed on paper
pursuant to Commission rules. To file electronic comments in this
proceeding, parties may use the electronic filing interface available
on the Commission's World Wide Web site at: http://
dettifoss.fcc.gov:8080/cgi-bin/ws.exe/
[[Page 38401]]
beta/ecfs/upload.hts>. Further information on the process of submitting
comments electronically is available at that location and at: http://
www.fcc.gov/e-file/>.
For purposes of this permit-but-disclose notice and comment
rulemaking proceeding, members of the public are advised that ex parte
presentations are permitted, except during the ``Sunshine Agenda''
period, provided they are disclosed under the Commission's rules.
Ordering Clauses
Accordingly, it is ordered That the actions reflected in the Notice
of Proposed Rulemaking of this Declaratory Ruling and Notice of
Proposed Rulemaking are taken pursuant to sections 1, 4(i), 7, 201,
202, 303(r), and 332 of Communications Act of 1934, as amended, 47
U.S.C. 151, 154(i), 157, 201, 202, 303(r), 332.
It is further ordered That notice is hereby given of the proposed
regulatory changes described in the Notice of Proposed Rulemaking, and
that comment is sought on these proposals.
It is further ordered That the Commission's Office of Public
Affairs, Reference Operations Division, shall send a copy of this
Notice, including the Initial Regulatory Flexibility Analysis, to the
Chief Counsel for Advocacy of the Small Business Administration in
accordance with section 603(a) of the Regulatory Flexibility Act of
1980, Public Law 96-354, 94 Stat. 1164, 5 U.S.C. 601-612 (1980).
Initial Regulatory Flexibility Analysis
As required by the Regulatory Flexibility Act (RFA),\27\ the
Commission has prepared this present Initial Regulatory Flexibility
Analysis (IRFA) of the possible significant economic impact on small
entities by the policies and rules proposed in this Notice of Proposed
Rulemaking (NPRM). 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 NPRM provided in paragraph 77 of
the full text of the NPRM. The Commission will send a copy of the NPRM,
including this IRFA, to the Chief Counsel for Advocacy of the Small
Business Administration.\28\ In addition, the NPRM and IRFA (or
summaries thereof) will be published in the Federal Register.\29\
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\27\ See 5 U.S.C. 603.
\28\ See 5 U.S.C. 603(a).
\29\ See id.
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A. Need for, and Objectives of, the Proposed Rules
In this NPRM, the Commission proposes solutions to obstacles that
may be impeding the ability of carriers interested in offering Calling
Party Pays (CPP) from doing so. CPP holds the potential for making
mobile wireless services more attractive to large numbers of customers
who do not subscribe today, and for spurring the acceptance and
development of services offered by mobile wireless telecommunications
providers as competitive alternatives to the services of local exchange
carriers (LECs). There is significant evidence that CPP would help
encourage Commercial Mobile Radio Service (CMRS) subscribers to leave
their handsets on and available to receive incoming calls because they
would not be incurring as high a cost for receiving calls on a usage-
sensitive basis. This increases the use of mobile wireless services,
and provides certain benefits to both calling parties, who otherwise
would not be able to complete calls to CMRS subscribers who keep their
phones off, and CMRS subscribers, who would no longer have an economic
incentive to avoid or minimize the acceptance of calls. These benefits
may be especially significant for price-conscious customers who find
that the flat-rate plans that come with large numbers of minutes
included are too expensive. CPP would also be beneficial to those
consumers concerned with the ability to control their monthly
telecommunications expenses. Thus, CPP holds the potential for making
mobile wireless services more effectively available to large numbers of
customers who do not subscribe today or who strictly limit their usage,
and to spur further competition by offering a different service option
that may be particularly attractive to low-income, and low-volume and
mid-volume consumers.
Because the Commission finds that there is some uncertainty about
the regulatory status of CPP, the Commission issued a Declaratory
Ruling clarifying that service offered with a CPP option, as defined in
paragraph 2 of the full text of the NPRM, still qualifies as CMRS
service. The NPRM considers important calling party notification
issues. The Commission there considers a uniform notification standard
to protect calling parties by providing them with sufficient
information to make an informed decision before completing a CPP call
to a wireless subscriber and incurring charges. The Commission also
asks how it may work cooperatively with the states to develop such a
notification system. The Commission also seeks comment on possible
additional measures. Second, the Commission discusses and seeks comment
on whether the proposed notification is sufficient to create an
``implied-in-fact'' contract between the caller and the CMRS carrier.
Third, the Commission discusses whether there is any need for
Commission action to protect callers from unreasonably high charges for
CPP calls. Fourth, the Commission discusses how CMRS providers may bill
and collect from the calling party for calls to CPP subscribers,
including LEC billing and collection. The Commission also seeks comment
at various points on issues relating to the accessibility of CPP
offerings to people with disabilities, including Telecommunications
Relay Service (TRS) and text telephone (TTY) users.
B. Legal Basis for Proposed Rules
The proposed action is authorized under sections 1, 4(i), 7, 201,
202, 303(r), and 332 of Communications Act of 1934, 47 U.S.C. 151,
154(i), 157, 201, 202, 303(r), 332.
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
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, if adopted.\30\ 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.\31\ 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).\32\ A small organization is
generally ``any not-for-profit enterprise which is independently owned
and operated and is not dominant in its field.'' \33\ Nationwide, as of
1992, there were approximately 275,801 small organizations.\34\ ``Small
governmental jurisdiction'' generally means ``governments of cities,
counties, towns, townships, villages, school districts, or special
districts, with a
[[Page 38402]]
population of less than 50,000.'' \35\ As of 1992, there were
approximately 85,006 such jurisdictions in the United States.\36\ This
number includes 38,978 counties, cities, and towns; of these, 37,566,
or 96 percent, have populations of fewer than 50,000. The Census Bureau
estimates that this ratio is approximately accurate for all
governmental entities. Thus, of the 85,006 governmental entities, we
estimate that 81,600 (96 percent) are small entities. Below, the
Commission further describes and estimates the number of small entity
licensees and regulatees that may be affected by the rules, herein
adopted.
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\30\ 5 U.S.C. 603(b)(3).
\31\ 5 U.S.C. 601(3).
\32\ Small Business Act, 15 U.S.C. 632 (1996).
\33\ 5 U.S.C. 601(4).
\34\47 U.S.C. 33.
\35\ 5 U.S.C. 601(5).
\36\ Commission regulation, as adopted pursuant to the CMRS
Second Report and Order, Implementation of Sections 3(n) and 332 of
the Communications Act, Regulatory Treatment of Mobile Services, GN
Docket 93-252, Second Report and Order, 9 FCC Rcd 1411, 1425, 1427-
28 (paras. 39 through 43) (1994) (CMRS Second Report and Order),
recon. pending (adopting section 20.3), further delineates the
statutory definition. Section 20.3(a)(1) adds to the phrase,
``provided for profit,'' the following language: ``i.e., with the
intent of receiving compensation or monetary gain.'' 47 CFR
20.3(A)(1).
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Common Carrier Services and Related Entities
The most reliable source of information regarding the total numbers
of certain common carrier and related providers nationwide, as well as
the number of commercial wireless entities, appears to be data the
Commission publishes in its Trends in Telephone Service report.
According to data in the most recent report, there are 3,528 interstate
carriers. These carriers include, inter alia, local exchange carriers,
wireline carriers and service providers, interexchange carriers,
competitive access providers, operator service providers, pay telephone
operators, providers of telephone toll service, providers of telephone
exchange service, and resellers.
The SBA has defined establishments engaged in providing
``Radiotelephone Communications'' and ``Telephone Communications,
Except Radiotelephone'' to be small businesses when they have no more
than 1,500 employees.\37\ Below, the Commission discusses the total
estimated number of telephone companies falling within the two
categories and the number of small businesses in each, and then
attempts to refine further those estimates to correspond with the
categories of telephone companies that are commonly used under its
rules.
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\37\ 13 CFR 121.201.
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Although some affected incumbent local exchange carriers (ILECs)
may have 1,500 or fewer employees, the Commission does not believe that
such entities should be considered small entities within the meaning of
the RFA because they are either dominant in their field of operations
or are not independently owned and operated, and therefore by
definition not ``small entities'' or ``small business concerns'' under
the RFA. Accordingly, our use of the terms ``small entities'' and
``small businesses'' does not encompass small ILECs. Out of an
abundance of caution, however, for regulatory flexibility analysis
purposes, the Commission will separately consider small ILECs within
this analysis and use the term ``small ILECs'' to refer to any ILECs
that arguably might be defined by the SBA as ``small business
concerns.'' \38\
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\38\ 13 CFR 121.201, SIC code 4813.
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Total Number of Telephone Companies Affected
The U.S. Bureau of the Census (``Census Bureau'') reports that, at
the end of 1992, there were 3,497 firms engaged in providing telephone
services, as defined therein, for at least one year. This number
contains a variety of different categories of carriers, including local
exchange carriers, interexchange carriers, competitive access
providers, cellular carriers, mobile service carriers, operator service
providers, pay telephone operators, covered specialized mobile radio
providers, and resellers. It seems certain that some of these 3,497
telephone service firms may not qualify as small entities or small
ILECs because they are not ``independently owned and operated.'' \39\
For example, a reseller that is affiliated with an interexchange
carrier having more than 1,500 employees would not meet the definition
of a small business. It is reasonable to conclude that fewer than 3,497
telephone service firms are small entity telephone service firms or
small ILECs that may be affected by the proposed rules.
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\39\ See generally, 15 U.S.C. 632(a)(1).
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Wireline Carriers and Service Providers
The SBA has developed a definition of small entities for telephone
communications companies except radiotelephone (wireless) companies.
The Census Bureau reports that there were 2,321 such telephone
companies in operation for at least one year at the end of 1992.
According to the SBA's definition, a small business telephone company
other than a radiotelephone company is one employing no more than 1,500
persons.\40\ All but 26 of the 2,321 non-radiotelephone companies
listed by the Census Bureau were reported to have fewer than 1,000
employees. Thus, even if all 26 of those companies had more than 1,500
employees, there would still be 2,295 non-radiotelephone companies that
might qualify as small entities or small ILECs. The Commission does not
have data specifying the number of these carriers that are not
independently owned and operated, and thus is unable at this time to
estimate with greater precision the number of wireline carriers and
service providers that would qualify as small business concerns under
the SBA's definition. Consequently, the Commission estimates that fewer
than 2,295 small telephone communications companies other than
radiotelephone companies are small entities or small ILECs that may be
affected by the proposed rules.
---------------------------------------------------------------------------
\40\ 13 CFR 121.201, SIC code 4813.
---------------------------------------------------------------------------
Local Exchange Carriers
Neither the Commission nor the SBA has developed a definition for
small providers of local exchange services. The closest applicable
definition under the SBA rules is for telephone communications
companies other than radiotelephone (wireless) companies. According to
the most recent telecommunications industry revenue data, 1,410
carriers reported that they were engaged in the provision of local
exchange services. The Commission does not have data specifying the
number of these carriers that are either dominant in their field of
operations, are not independently owned and operated, or have more than
1,500 employees, and thus is unable at this time to estimate with
greater precision the number of LECs that would qualify as small
business concerns under the SBA's definition. Consequently, the
Commission estimates that fewer than 1,410 providers of local exchange
service are small entities or small ILECs that may be affected by the
proposed rules.
Pay Telephone Operators
Neither the Commission nor the SBA has developed a definition of
small entities specifically applicable to pay telephone operators. The
closest applicable definition under SBA rules is for telephone
communications companies other than radiotelephone (wireless)
companies.\41\ According to the most recent Trends in Telephone Service
data, 509 carriers reported that they were engaged in the provision of
pay telephone services. The Commission does not have data
[[Page 38403]]
specifying the number of these carriers that are not independently
owned and operated or have more than 1,500 employees, and thus is
unable at this time to estimate with greater precision the number of
pay telephone operators that would qualify as small business concerns
under the SBA's definition. Consequently, the Commission estimates that
there are fewer than 509 small entity pay telephone operators that may
be affected by the proposed rules.
---------------------------------------------------------------------------
\41\ 13 CFR 121.201, SIC code 4813.
---------------------------------------------------------------------------
Resellers (including debit card providers)
Neither the Commission nor the SBA has developed a definition of
small entities specifically applicable to resellers. The closest
applicable SBA definition for a reseller is a telephone communications
company other than radiotelephone (wireless) companies.\42\ According
to the most recent Trends in Telephone Service data, 358 reported that
they were engaged in the resale of telephone service. The Commission
does not have data specifying the number of these carriers that are not
independently owned and operated or have more than 1,500 employees, and
thus is unable at this time to estimate with greater precision the
number of resellers that would qualify as small business concerns under
the SBA's definition. Consequently, the Commission estimates that there
are fewer than 358 small entity resellers that may be affected by the
proposed rules.
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\42\ Id.
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International Services
The Commission has not developed a definition of small entities
applicable to licensees in the international services. Therefore, the
applicable definition of small entity is generally the definition under
the SBA rules applicable to Communications Services, Not Elsewhere
Classified (NEC). This definition provides that a small entity is
expressed as one with $11.0 million or less in annual receipts.\43\
According to the Census Bureau, there were a total of 848
communications services providers, NEC, in operation in 1992, and a
total of 775 had annual receipts of less than $9.999 million. The
Census report does not provide more precise data.
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\43\ 13 CFR 120.121, SIC code 4899.
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Wireless and Commercial Mobile Services
Cellular Licensees
Neither the Commission nor the SBA has developed a definition of
small entities applicable to cellular licensees. Therefore, the
applicable definition of small entity is the definition under the SBA
rules applicable to radiotelephone (wireless) companies. This provides
that a small entity is a radiotelephone company employing no more than
1,500 persons.\44\ According to the Bureau of the Census, only twelve
radiotelephone firms from a total of 1,178 such firms which operated
during 1992 had 1,000 or more employees. Therefore, even if all twelve
of these firms were cellular telephone companies, nearly all cellular
carriers were small businesses under the SBA's definition. In addition,
the Commission notes that there are 1,758 cellular licenses; however, a
cellular licensee may own several licenses. In addition, according to
the most recent Trends in Telephone Service data, 732 carriers reported
that they were engaged in the provision of either cellular service or
Personal Communications Service (PCS) services, which are placed
together in the data. The Commission does not have data specifying the
number of these carriers that are not independently owned and operated
or have more than 1,500 employees, and thus is unable at this time to
estimate with greater precision the number of cellular service carriers
that would qualify as small business concerns under the SBA's
definition. Consequently, the Commission estimates that there are fewer
than 732 small cellular service carriers that may be affected by the
proposed rules.
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\44\ 13 CFR 121.201, SIC code 4812.
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220 MHz Radio Service-Phase I Licensees
The 220 MHz service has both Phase I and Phase II licenses. Phase I
licensing was conducted by lotteries in 1992 and 1993. There are
approximately 1,515 such non-nationwide licensees and four nationwide
licensees currently authorized to operate in the 220 MHz band. The
Commission has not developed a definition of small entities
specifically applicable to such incumbent 220 MHZ Phase I licensees. To
estimate the number of such licensees that are small businesses, the
Commission applies the definition under the SBA rules applicable to
Radiotelephone Communications companies. This definition provides that
a small entity is a radiotelephone company employing no more than 1,500
persons. According to the Bureau of the Census, only 12 radiotelephone
firms out of a total of 1,178 such firms which operated during 1992 had
1,000 or more employees. Therefore, if this general ratio continues in
1999 in the context of Phase I 220 MHz licensees, the Commission
estimates that nearly all such licensees are small businesses under the
SBA's definition.
220 MHz Radio Service-Phase II Licensees
The Phase II 220 MHz service is a new service, and is subject to
spectrum auctions. In the 220 MHz Third Report and Order, the
Commission adopted criteria for defining small businesses and very
small businesses for purposes of determining their eligibility for
special provisions such as bidding credits and installment payments.
The Commission has defined a small business as an entity that, together
with its affiliates and controlling principals, has average gross
revenues not exceeding $15 million for the preceding three years.
Additionally, a very small business is defined as an entity that,
together with its affiliates and controlling principals, has average
gross revenues that are not more than $3 million for the preceding
three years. The SBA has approved these definitions. An auction of
Phase II licenses commenced on September 15, 1998, and closed on
October 22, 1998. Nine hundred and eight (908) licenses were auctioned
in 3 different-sized geographic areas: three nationwide licenses, 30
Regional Economic Area Group Licenses, and 875 Economic Area (EA)
Licenses. Of the 908 licenses auctioned, 693 were sold. Companies
claiming small business status won: one of the Nationwide licenses, 67%
of the Regional licenses, and 54% of the EA licenses. As of January 22,
1999, the Commission announced that it was prepared to grant 654 of the
Phase II licenses won at auction. A re-auction of the remaining, unsold
licenses is likely to take place during calendar year 1999.
Private and Common Carrier Paging
The Commission has proposed a two-tier definition of small
businesses in the context of auctioning licenses in the Common Carrier
Paging and exclusive Private Carrier Paging services. Under the
proposal, a small business will be defined as either (1) an entity
that, together with its affiliates and controlling principals, has
average gross revenues for the three preceding years of not more than
$3 million, or (2) an entity that, together with affiliates and
controlling principals, has average gross revenues for the three
preceding calendar years of not more than $15 million. Because the SBA
has not yet approved this definition for paging services, the
Commission will utilize the SBA's definition applicable to
radiotelephone companies, i.e., an entity employing no more than 1,500
[[Page 38404]]
persons. At present, there are approximately 24,000 Private Paging
licenses and 74,000 Common Carrier Paging licenses. According to the
most recent Trends in Telephone Service data, 137 carriers reported
that they were engaged in the provision of either paging or ``other
mobile'' services, which are placed together in the data. The
Commission does not have data specifying the number of these carriers
that are not independently owned and operated or have more than 1,500
employees, and thus is unable at this time to estimate with greater
precision the number of paging carriers that would qualify as small
business concerns under the SBA's definition. Consequently, the
Commission estimates that there are fewer than 137 small paging
carriers that may be affected by the proposed rules, if adopted. The
Commission estimates that the majority of private and common carrier
paging providers would qualify as small entities under the SBA
definition.
Mobile Service Carriers
Neither the Commission nor the SBA has developed a definition of
small entities specifically applicable to mobile service carriers, such
as paging companies. As noted above in the section concerning paging
service carriers, the closest applicable definition under the SBA rules
is that for radiotelephone (wireless) companies,\45\ and the most
recent Telecommunications Industry Revenue data shows that 23 carriers
reported that they were engaged in the provision of SMR dispatching and
``other mobile'' services. Consequently, the Commission estimates that
there are fewer than 23 small mobile service carriers that may be
affected by the proposed rules.
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\45\ 13 CFR 121.201, SIC code 4812.
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Broadband Personal Communications Service (PCS)
The broadband 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 less than $40 million 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 their affiliates, has average gross
revenues of not more than $15 million for the preceding three calendar
years. These regulations defining ``small entity'' in the context of
broadband PCS auctions have been approved by the SBA. No small
businesses within the SBA-approved definition 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% of the
1,479 licenses for Blocks D, E, and F. Based on this information, the
Commission concludes that the number of small broadband PCS licensees
will include the 90 winning C Block bidders and the 93 qualifying
bidders in the D, E, and F blocks, for a total of 183 small entity PCS
providers as defined by the SBA and the Commission's auction rules.
Narrowband PCS
The Commission has auctioned nationwide and regional licenses for
narrowband PCS. There are 11 nationwide and 30 regional licensees for
narrowband PCS. The Commission does not have sufficient information to
determine whether any of these licensees are small businesses within
the SBA-approved definition for radiotelephone companies. At present,
there have been no auctions held for the major trading area (MTA) and
basic trading area (BTA) narrowband PCS licenses. The Commission
anticipates a total of 561 MTA licenses and 2,958 BTA licenses will be
awarded by auction. Such auctions have not yet been scheduled, however.
Given that nearly all radiotelephone companies have no more than 1,500
employees and that no reliable estimate of the number of prospective
MTA and BTA narrowband licensees can be made, the Commission assumes,
for purposes of this IRFA, that all of the licenses will be awarded to
small entities, as that term is defined by the SBA.
Rural Radiotelephone Service
The Commission has not adopted a definition of small entity
specific to the Rural Radiotelephone Service. A significant subset of
the Rural Radiotelephone Service is the Basic Exchange Telephone Radio
Systems (BETRS).\46\ The Commission will use the SBA's definition
applicable to radiotelephone companies, i.e., an entity employing no
more than 1,500 persons.\47\ There are approximately 1,000 licensees in
the Rural Radiotelephone Service, and the Commission estimates that
almost all of them qualify as small entities under the SBA's
definition.
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\46\ BETRS is defined in sections 22.757 and 22.759 of the
Commission's Rules, 47 CFR 22.757 and 22.759.
\47\ 13 CFR 121.201, SIC code 4812.
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Air-Ground Radiotelephone Service
The Commission has not adopted a definition of small entity
specific to the Air-Ground Radiotelephone Service.\48\ Accordingly, the
Commission will use the SBA's definition applicable to radiotelephone
companies, i.e., an entity employing no more than 1,500 persons.\49\
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 definition.
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\48\ The service is defined in section 22.99 of the Commission's
Rules, 47 CFR 22.99.
\49\ 13 CFR 121.201, SIC code 4812.
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Specialized Mobile Radio (SMR)
The Commission awards bidding credits in auctions for geographic
area 800 MHz and 900 MHz SMR licenses to firms that had revenues of no
more than $15 million in each of the three previous calendar years.\50\
In the context of 900 MHz SMR, this regulation defining ``small
entity'' has been approved by the SBA; approval concerning 800 MHz SMR
is being sought. The proposed rules in the NPRM apply to SMR providers
in the 800 MHz and 900 MHz bands that either hold geographic area
licenses or have obtained extended implementation authorizations. The
Commission does not know how many firms provide 800 MHz or 900 MHz
geographic area SMR service pursuant to extended implementation
authorizations, nor how many of these providers have annual revenues of
no more than $15 million. One firm has over $15 million in revenues.
The Commission assumes, for purposes of this IRFA, that all of the
remaining existing extended implementation authorizations are held by
small entities, as that term is defined by the SBA.
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\50\ 47 CFR 90.814(b)(1).
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For geographic area licenses in the 900 MHz SMR band, there are 60
who qualified as small entities. For the 800 MHz SMR's, 38 are small or
very small entities.
Offshore Radiotelephone Service
This service operates on several UHF TV broadcast channels that are
not used for TV broadcasting in the coastal area of the states
bordering the Gulf of Mexico.\51\ At present, there are approximately
55 licensees in this service. We are unable at this time to
[[Page 38405]]
estimate the number of licensees that would qualify as small under the
SBA's definition for radiotelephone communications.
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\51\ This service is governed by subpart I of part 22 of the
Commission's Rules. See 47 CFR 22.1001-22.1037.
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D. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
CMRS carriers interested in offering their subscribers CPP would be
required to provide a notification to those placing calls to the CPP
subscriber that include the following elements: (1) Notice that the
calling party is making a call to a wireless phone subscriber that has
chosen the CPP option, and that the calling party therefore will be
responsible for payment of airtime charges; (2) Identification of the
CMRS provider; (3) The per minute rate, or other rates, that the caller
will be charged by the CMRS provider; and (4) An opportunity to
terminate the call prior to incurring any charges. In addition, LECs
may be required to provide billing name and address information to CMRS
carriers for parties who call CPP subscribers. Comments are also
requested on the possible need for billing and collection services to
be provided for CPP by LECs. The Commission requests comment on how
these requirements can be modified to reduce the burden on small
entities and still meet the objectives of the proceeding.
E. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
The Commission has minimized burdens to the maximum extent
possible. CPP is an optional CMRS offering that carriers may provide to
their wireless subscribers, at the sole discretion of the carrier. As
to the provision of caller billing name and address information, or
billing and collection services, it is anticipated that any such
services would be provided to CMRS carriers at negotiated rates that
would enable LECs to recover all associated costs. The Commission seeks
comment on significant alternatives that commenters believe should be
adopted.
F. Federal Rules that May Duplicate, Overlap, or Conflict With the
Proposed Rules: None
List of Subjects in 47 CFR Part 20
Communications common carrier; Communications radio.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 99-18232 Filed 7-15-99; 8:45 am]
BILLING CODE 6712-01-P
