[Federal Register Volume 61, Number 166 (Monday, August 26, 1996)]
[Proposed Rules]
[Pages 43721-43725]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-21793]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 2, 22, 24, 90
[WT Docket No. 96-6; FCC 96-283]
Flexible Service Offerings in the Commercial Mobile Radio
Services
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this Further Notice of Proposed Rule Making the Commission
seeks comment on the regulatory treatment of entities offering fixed
services on CMRS spectrum. The rule amendments are necessary to respond
to the strong support to flexible services show in the initial Notice
of Proposed Rule Making. The comment period is necessary for
clarification prior to making a final determination with respect to the
regulatory treatment of licensees providing such services. The intended
effect of this action is to provide a service that will further the
public interest.
DATES: Comments are to be filed on or before November 25, 1996, and
reply comments are to be filed on or before December 24, 1996.
ADDRESSES: Federal Communications Commission, 1919 M Street, N.W.,
Washington, D.C. 20554.
FOR FURTHER INFORMATION CONTACT: David Krech, Commercial Wireless
Division, Wireless Telecommunications Bureau, at (202) 418-0620.
SUPPLEMENTARY INFORMATION: The First Report and Order and Further
Notice of Proposed Rule Making in WT Docket No. 96-6, adopted on June
27, 1996, and released on August 1, 1996, is available for inspection
and copying during normal business hours in the FCC Reference Center,
Room 575, 2000 M Street N.W., Washington, D.C. The complete text may
also be purchased from the Commission's copy contractor, International
Transcription Service, Inc., 2100 M Street N.W., Suite 140, Washington,
D.C. 20037, (202) 857-3800.
Summary of Action
I. Introduction & Executive Summary
1. In the Notice of Proposed Rule Making in WT Docket No. 96-6
(``NPRM'') (Amendment of the Commission's Rules to Permit Flexible
Service Offerings in the Commercial Mobile Radio Services, Notice of
Proposed Rule Making, WT Docket No. 96-6, 11 FCC Rcd 2445 (1996)),
released on January 25, 1996, 61 FR 6189 (February 16, 1996), we sought
comment on proposals for expanding permitted offerings of fixed
wireless service by Commercial Mobile Radio Service (``CMRS'')
providers. In addition, we sought comment with regard to the regulatory
treatment for such services under Section 332 of the Communications Act
of 1934, as amended. 47 U.S.C. Sec. 332.
2. In this Further Notice of Proposed Rule Making, we seek
additional comment on the regulatory treatment of entities offering
fixed services on CMRS spectrum:
We do not intend to alter the regulatory treatment of
licensees offering the types of ancillary, auxiliary, and incidental
fixed services that have been offered by CMRS providers under our rules
prior to this order.
We propose to establish a presumption that licensees
offering other fixed services over CMRS spectrum should be regulated as
CMRS. We seek comment on such a presumption and, if adopted, what
factors should be used to support or rebut this presumption.
II. Further Notice of Proposed Rule Making
3. Discussion. Based on our review of the record in WT 96-6, we
believe it is premature to attempt a final comprehensive determination
regarding the regulatory treatment of these various types of fixed
services that may be offered by licensees. While some commenters argue
that all of the fixed offerings described above should be treated as
sufficiently related to CMRS to justify uniform regulatory treatment,
we believe that a uniform approach would be premature at this time.
Instead, we believe that the regulatory issues raised by this
proceeding require further development of the record and more specific
analysis related to the particular fixed service offerings that
carriers develop. Therefore, we propose to refine the approach set
forth in the NPRM by seeking comment on additional guidelines for
determining when fixed wireless services may fall within the scope of
CMRS regulation.
4. At the outset, we emphasize that our decision in the First
Report in Order to allow carriers to offer co-primary fixed services on
spectrum allocated for CMRS does not alter in any way our regulatory
treatment of fixed services
[[Page 43722]]
that have been provided by CMRS providers under our prior rules. In the
CMRS Second Report and Order, 59 FR 18493 (April 19, 1994), we stated
that ancillary, auxiliary, and incidental services offered by CMRS
providers fall within the statutory definition of mobile service, and
are subject to CMRS regulation. We reaffirm that determination here. In
the First Report and Order, however, we broadened the potential scope
of fixed services that may be offered by CMRS providers. We therefore
seek further comment on the regulatory treatment of such fixed services
that may not be considered ancillary, auxiliary or incidental to mobile
service.
5. Several parties argue that because the definition of ``mobile
service'' contains a clause referencing PCS licenses, Congress intended
that all service provided through a PCS license would be treated as
mobile. According to Omnipoint, inclusion of the PCS clause means that
the Act, unlike FCC regulations, does not limit the amount of fixed
service a PCS provider may offer, and the offering of fixed service by
a PCS licensee does not change its status as a CMRS provider. AT&T and
CTIA argue, further, that since one goal of Congress and the Commission
is regulatory parity for similarly situated CMRS providers, all
services provided through a license for a CMRS service, not just a PCS
license, come within the definition of ``mobile service.'' One could
also read the definition of ``mobile service'' to require the use of
``mobile stations'' and the ``and includes'' language which precedes
the description of the three enumerated services to mean that they are
examples. In that case, a service provided with a PCS license would
have to include the use of a ``mobile station'' to come within the
definition of ``mobile service'' and consequently be considered in the
definition of ``commercial mobile service.'' ``Mobile station'' is
defined in the Act as ``a radio-communication station capable of being
moved and which ordinarily does move.'' 47 U.S.C. Sec. 153(28). We seek
comment on these alternative statutory interpretations and their
regulatory consequences. Parties should submit support from the
legislative history or prior Commission rulings for or against the
argument that the language ``and includes'' in the definition of
``mobile service'' sets out examples of mobile services, rather than
listing additional services which come under the definition.
6. CTIA also argues that the Commission has substantial discretion
under the Act to define ``mobile services.'' CTIA states that this
authority stems from the language in the PCS clause of the definition
of ``mobile service'' that refers to ``any successor proceeding.''
According to CTIA, that language allows the Commission to establish
alternative definitions of ``mobile service'' in successor proceedings.
We seek comment on the breadth and scope of Commission authority under
the PCS clause and the ``any successor proceeding'' language.
7. As noted above, in the CMRS Second Report and Order we found
that the definition of ``mobile service'' includes ``all auxiliary
services provided by mobile service licensees.'' We seek comment on
what precedential value, if any, we should give to our treatment of
auxiliary, ancillary, and incidental services as CMRS for regulatory
purposes when determining how to regulate other fixed wireless services
provided by CMRS providers. For example, because we consider a fixed
service that is ancillary to a mobile service to be CMRS, what
implications should that have for how we should treat a wholly fixed
service that may use no mobile stations.
8. Some parties have also argued that because these fixed wireless
services would be provided by CMRS providers in spectrum that has been
allocated for CMRS, the service providers must therefore be regulated
as CMRS. We disagree. The regulatory structure for providers of the
primary service to which the spectrum is allocated does not necessarily
dictate the type of regulation to which every service provider in that
same band will be subject regardless of the particular attributes of
that service. A pertinent example is BETRS. While BETRS is provided in
a spectrum band allocated to Public Land Mobile Service, we have
determined that BETRS is a fixed service, rather than a mobile service,
and therefore BETRS providers are not subject to CMRS regulation under
Section 332. Similarly, private service licensees in the 220 and 800
MHz SMR bands are not subject to CMRS regulation. Likewise, we do not
intend to base our decision here merely on the classification of the
majority of users of the spectrum in which the fixed service in
question is provided.
9. We believe that, ultimately, the regulatory issues on which we
seek comment herein may require resolution on a case-by-base basis. We
seek comment on this conclusion, including whether we may be able to
establish a uniform approach for determining the regulatory status of
fixed services offered on CMRS spectrum. To provide a framework for a
case-by-case analysis, we propose to establish a rebuttable presumption
that any wireless service provided under a CMRS provider's license
would be considered to come within the definition of CMRS and
consequently regulated as CMRS. Based on the record in this proceeding,
we believe this to be a reasonable presumption. Most of the fixed
wireless service applications which commenters have discussed in the
record would be provided in conjunction with a traditional CMRS
services such as cellular or paging.
10. Under our proposed approach, the Commission would allow any
interested party to challenge this presumption regarding a particular
service offered by a CMRS provider. If a party could demonstrate that
the service provider in question does not meet the definition of CMRS
for a particular offering, we would not regulate that particular
offering as CMRS. We seek comment on this approach and what types of
evidence the Commission should evaluate when considering a challenge to
a presumption that a fixed wireless service provided by a CMRS provider
should be regulated as CMRS. Possible factors may include: the relative
mobility of mobile stations used in conjunction with the fixed service;
whether the fixed service is part of a larger package which includes
mobile services or is offered alone; the size of the service area over
which the fixed wireless service is provided; the amount of mobile
versus fixed traffic over the wireless system; whether the fixed
service is offered over a discrete block of spectrum separate from the
spectrum used for mobile services; the degree to which fixed and mobile
services are integrated; and whether customers perceive the service to
be a fixed service. Part of any analysis of customer perception may
also include consideration of how the service is marketed by the CMRS
provider to potential customers.
11. The Commission seeks comment on the appropriateness of using
these factors or other types of evidence that may be presented to rebut
this presumption. We also seek comment on the extent to which services
provided under separate licenses or by separate entities may be
relevant to the regulatory status of a particular fixed service
offering provided under a given license. For example, should we
consider only the services provided under a particular license or
consider the services provided by a common licensee under multiple
licenses, e.g., a licensee who provides fixed service under its PCS
license and mobile service under a cellular license in the same market.
Similarly, in instances
[[Page 43723]]
where fixed and mobile services are provided by different corporate
affiliates, should we look at each affiliate's service separately or at
the services provided by the corporation as a whole? Another possible
scenario would be where a CMRS provider provides fixed service under
its own license and has a joint marketing arrangement or resale
agreement with another CMRS provider in that market. How should we
consider such arrangements in making our analysis under this
presumption? We seek comment on our proposal for regulating fixed
wireless service provided by a CMRS provider and we seek alternative
suggestions for presumptive regulatory classifications.
12. Some parties have advocated that we regulate any fixed wireless
service provided by a CMRS provider as CMRS until such time that the
service constitutes a substitute for land line telephone exchange
service in a substantial portion of a state. Under this approach a
state would have to petition the Commission under Section 332(c)(3),
and the Commission would have to grant such a petition, before a CMRS
provider's fixed wireless service would be subject to state regulation.
The Commission seeks comment on this approach. We also seek comment on
what federal regulation should be imposed on a CMRS provider's offering
of fixed wireless service if we find that it does not come within the
purview of CMRS. To the extent that there are interstate common carrier
services, such services would be subject to regulation under Title II;
if so are there any Title II regulations from which such services
should be exempt?
13. The Commission recognizes that we are addressing a related
issue in the context of our proceeding on implementation of Section 251
of the Communications Act, as amended by the 1996 Act--i.e., in what
circumstances, if any, a CMRS provider should be regulated as a ``local
exchange carrier'' under the Act. Herein we are concerned with whether
service providers should be regulated as CMRS if they provide fixed
services. While we will review and consider the comments submitted in
the Section 251 proceeding, we do not believe that resolution of the
issue presented in the Section 251 proceeding resolves the issues
presented here. For example, even if we were to find that a CMRS
provider could be considered a local exchange carrier in terms of the
requirements in Section 251, we tentatively conclude that it could
still be considered engaged in the provision of CMRS under Section 332
and therefore exempt from states' regulation of intrastate rates. We
seek comment on this tentative conclusion and whether the other
obligations imposed on LECs have a direct relationship to the rates
charged by CMRS providers, and thus may impact on the rate regulation
scheme set out in Section 332.
III. Procedural Matters
A. Regulatory Flexibility Act
14. As required by Section 603 of the Regulatory Flexibility Act,
the Commission has prepared an Initial Regulatory Flexibility Analysis
(IRFA) of the expected impact on small entities of the proposals
suggested in this document. Written public comments are requested on
the IRFA. We also seek comment on the number of CMRS entities affected
by the proposed rules are small businesses, and request that commenters
identify whether they themselves are small businesses. These comments
must be filed in accordance with the same filing deadlines as comments
on the rest of the Further Notice of Proposed Rule Making, but they
must have a separate and distinct heading designating them as responses
to the Initial Regulatory Flexibility Analysis. The Secretary shall
send a copy of this First Report and Order and Further Notice of
Proposed Rule Making, including the Initial Regulatory Flexibility
Analysis, to the Chief Counsel for Advocacy of the Small Business
Administration in accordance with paragraph 603(a) of the Regulatory
Flexibility Act. Public Law No. 96-354, 94 Stat. 1164, 5 U.S.C.
Sec. 601 et. seq. (1981).
1. Reason for Action
15. This rule making proceeding was initiated to secure comment on
proposals for allowing CMRS providers greater flexibility in the
provision of fixed wireless services. The proposals advanced in the
Further Notice of Proposed Rule Making are designed to determine the
appropriate regulatory scheme for CMRS providers who wish to offer
fixed wireless services. The Commission seeks comment on the
appropriate role of the federal government and the states in the
regulation of CMRS providers who offer hybrid mobile and fixed services
on a co-primary basis.
2. Objectives
16. The Commission proposes to establish a rebuttable presumption
that any wireless service provided under a CMRS provider's license
would be considered to come within the definition of CMRS and
consequently regulated as CMRS. Under this approach, the Commission
would allow any interested party to challenge this presumption
regarding a particular service offered by a CMRS provider. If a party
could demonstrate that the service provider in question does not meet
the definition of CMRS for a particular offering, we would not regulate
that particular offering as CMRS. We seek comment on this approach and
what types of evidence the Commission should evaluate when considering
a challenge to a presumption that a fixed wireless service provided by
a CMRS provider should be regulated as CMRS. We also seek comment on
the extent to which services provided under separate licenses or by
separate entities may be relevant to the regulatory status of a
particular fixed service offering provided under a given license. Some
parties have advocated that we regulate any fixed wireless service
provided by a CMRS provider as CMRS until such time that the service
constitutes a substitute for land line telephone exchange service in a
substantial portion of a state. We seek comment on this approach. We
also seek comment on what federal regulation should be imposed on a
CMRS provider's offering of fixed wireless service if we find that it
does not come within the purview of CMRS.
3. Reporting, Recordkeeping, and Other Compliance Requirements
17. The proposals under consideration in the Further Notice of
Proposed Rule Making do not require recordkeeping, or other compliance
requirements for small business entities.
4. Federal Rules Which Overlap, Duplicate or Conflict With These Rules
18. None.
5. Description, and Number of Small Entities Involved
19. Pursuant to the Contract with America Advancement Act of 1996,
Public Law No. 104-121, 110 Stat. 847 (1996), the Commission is
required to estimate in its Final Regulatory Flexibility Analysis the
number of small entities to which a rule will apply, provide a
description of such entities, and assess the impact of the rule on such
entities. To assist the Commission in this analysis, commenters are
requested to provide information regarding how many total CMRS entities
would be affected by the proposed rules in the Further Notice of
Proposed Rule Making. In particular, we seek estimates of how many CMRS
entities are small businesses.
[[Page 43724]]
20. There are different definitions of ``small business'' for the
various services affected by this proceeding. Since the Commission did
not define a small business with respect to cellular services, paging,
and interconnected business radio service, we will utilize the Small
Business Administration's (SBA) definition applicable to radiotelephone
companies--i.e. an entity employing less than 1,500 persons. 13 CFR
Sec. 121.201, Standard Industrial Classification (SIC) Code 4812. We
seek comment on whether this definition should be refined to take into
account the different classes of cellular, paging and for-profit
interconnected business radio services. With respect to narrowband and
broadband PCS, the Commission defines small business to mean firms who
have gross revenues of not more than $40 million in each of the
preceding three calendar years. With respect to 800 MHz and 900 MHz SMR
services, the Commission has a two-tiered definition of small business:
(a) ``very small businesses'' are firms who have gross revenues of not
more than $3 million in each of the preceding three calendar years; and
(b) ``small businesses'' are firms who have annual gross revenues of
not more than $15 million in the each of the preceding three years.
With respect to commercial 220 MHz services, the Commission has
proposed a two-tiered analysis: (1) for EA licensees, a firm with
average annual gross revenues of not more than $6 million for the
preceding three years and (2) for regional and nationwide licensees, a
firm with average annual gross revenues of not more than $15 million
for the preceding 3 years.
21. We seek comment on our use of these definitions in this
context. Additionally, we request commenters to identify whether they
are a ``small business'' under this definition. For commenters that are
a subsidiary of another entity, we seek this information for both the
subsidiary and the parent corporation or entity.
6. Significant Alternatives Minimizing the Impact on Small Entities
Consistent With the Stated Objectives
22. In the Further Notice of Proposed Rule Making the Commission
proposes to establish a rebuttable presumption that any wireless
service provided under a CMRS provider's license would be considered to
come within the definition of CMRS and be regulated as CMRS. The
Commission seeks comment on this approach and what types of evidence
the Commission should evaluate when considering a challenge to such a
presumption. Other alternatives suggested in the comment to the Notice
of Proposed Rule Making, 61 FR 6189 (February 16, 1996), include
regulating any fixed wireless service provided by a CMRS provider as
CMRS until such time that the service constitutes a substitute for land
line telephone exchange service in a substantial portion of a state. We
seek comment on that approach and any additional significant
alternatives presented in the comments also will be considered. If the
fixed wireless service provided by a CMRS provider, including small
business entities, is not regulated as CMRS, that service may be
subject to state regulation of entry and rates. We also seek comment on
what Federal regulation should be imposed on a CMRS provider's offering
of fixed wireless service if that service does not come within the
purview of CMRS. We also seek comment on what impact each alternative
may have on small business entities.
7. Legal Basis
23. The proposed action is authorized under Sections 4(i), 4(j),
7(a), 303(b), 303(f), 303(g), 303(r), 332(a), and 332(c) of the
Communications Act of 1934, as amended, 47 U.S.C. Secs. 154(i), 154(j),
157(a), 303(b), 303(f), 303(g), 303(r), 332(a), and 332(c).
8. IRFA Comments
24. We request written public comment on the foregoing Initial
Regulatory Flexibility Analysis. Comments must have a separate and
distinct heading designating them as responses to the IRFA and must be
filed by the deadlines provided in paragraph 27 below.
B. Ex Parte Rules--Non-Restricted Proceeding
25. This is a non-restricted notice and comment rule making
proceeding. Ex parte presentations are permitted except during the
Sunshine Agenda period, provided they are disclosed as provided in the
Commission's rules. See generally 47 CFR Secs. 1.1202, 1.1203, and
1.1206(a).
C. Initial Paperwork Reduction Act of 1995 Analysis
26. The First Report and Order and Further Notice of Proposed Rule
Making do not contain either a proposed or modified information
collection.
D. Comment Dates
27. Pursuant to applicable procedures set forth in Sections 1.415
and 1.419 of the Commission's rules, 47 CFR Secs. 1.415 and 1.419,
interested parties may file comments on or before November 25, 1996,
and reply comments on or before December 24, 1996. To file formally in
this proceeding, you must file an original and four copies of all
comments, reply comments, and supporting comments. If you want each
Commissioner to receive a personal copy of your comments, you must file
an original plus nine copies. You should send comments and reply
comments to the Office of the Secretary, Federal Communications
Commission, Washington, D.C. 20554. Comments and reply comments will be
available for public inspection during regular business hours in the
FCC Reference Center of the Federal Communications Commission, Room
239, 1919 M Street, N.W., Washington, D.C. 20554.
28. As required by Section 603 of the Regulatory Flexibility Act,
the Commission has prepared an Initial Regulatory Flexibility Analysis
of the expected impact on small entities of the proposals suggested in
the Further Notice of Proposed Rule Making. Written public comments are
requested on the IRFA. These comments must be filed in accordance with
the same filing deadlines as comments on the remainder of the Further
Notice of Proposed Rule Making, but they must have a separate and
distinct heading designating them as responses to the IRFA. The
Secretary shall send a copy of this Further Notice of Proposed Rule
Making, including the IRFA, the Chief Counsel for Advocacy of the Small
Business Administration in accordance with paragraph 603(a) of the
Regulatory Flexibility Act. Public Law No. 96-354, 94 Stat. 1164, 5
U.S.C. Sec. 601 et. seq. (1981).
E. Contacts for Information
29. For further information concerning this proceeding, contact
David Krech at (202) 418-0620 (Commercial Wireless Division, Wireless
Telecommunications Bureau).
List of Subjects
47 CFR Part 2
Radio.
47 CFR Part 22
Communications common carriers, Radio.
47 CFR Part 24
Communications common carriers, Radio.
47 CFR Part 90
Business and industry, Common carriers, Radio.
[[Page 43725]]
Federal Communications Commission
William F. Caton,
Acting Secretary.
[FR Doc. 96-21793 Filed 8-23-96; 8:45 am]
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