[Federal Register: January 7, 2003 (Volume 68, Number 4)]
[Proposed Rules]
[Page 730-740]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07ja03-10]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Chapter 1
[WT Docket No. 02-379; FCC 02-327]
Annual Report and Analysis of Competitive Market Conditions With
Respect to Commercial Mobile Services
AGENCY: Federal Communications Commission.
ACTION: Proposed rule; notice of inquiry.
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SUMMARY: This document solicits data and information on the status of
competition in the CMRS industry for our Eighth Annual Report and
Analysis of Competitive Market Conditions with Respect to Commercial
Mobile Services (``Eighth Report''). The Eighth Report will provide an
assessment of the current state of competition and changes in the CMRS
competitive environment.
DATES: Comments are due on or before January 27, 2003 and reply
comments are due on or before February 11, 2003.
ADDRESSES: All filings must be addressed to the Commission's Secretary,
Office of the Secretary, Federal Communications Commission. Parties
also should send four (4) paper copies of their filings to Chelsea
Fallon, Federal Communications Commission, Room 4-A335, 445 12th
Street, SW., Washington, DC 20554. See ``Supplementary Information''
for comment and reply comment filing instructions.
FOR FURTHER INFORMATION CONTACT: Chelsea Fallon at (202) 418-7991.
SUPPLEMENTARY INFORMATION: This is a summary of the Notice of Inquiry
released on December 13, 2002. The complete text of the Notice of
Inquiry is
[[Page 731]]
available for public inspection and copying during regular business
hours at the FCC Reference Information Center, Portals II, 445 12th
Street, SW., Room CY-A257, Washington, DC, 20554. The Notice of Inquiry
may also be purchased from the Commission's duplicating contractor,
Qualex International, Portals II, 445 12th Street, SW., Room CY-B402,
Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898,
or via e-mail qualexint@aol.com.
Introduction
1. In 1993, Congress created the statutory classification of
Commercial Mobile Services to promote the consistent regulation of
similar mobile radio services. At the same time, Congress established
the promotion of competition as a fundamental goal for CMRS policy
formation and regulation. To measure progress toward this goal,
Congress required the Federal Communications Commission (``Commission''
or ``FCC'') to submit annual reports that analyze competitive
conditions in the industry. The Notice of Inquiry solicits data and
information on the status of competition in the CMRS industry for our
Eighth Annual Report and Analysis of Competitive Market Conditions with
Respect to Commercial Mobile Services (``Eighth Report''). The Eighth
Report will provide an assessment of the current state of competition
and changes in the competitive environment since the release of the
Seventh Report, 17 FCC Rcd 12985 (2002).
2. The Notice of Inquiry is part of the Commission's ongoing effort
to improve its CMRS Reports. In February 2002, the Commission held a
Public Forum to examine ways in which to better gather and analyze data
for the Seventh Report, in particular data regarding the development of
CMRS services in rural and underserved areas. As a result of the forum,
the Commission was able to integrate new data into the Seventh Report
and adopted a number of suggestions made by forum participants on how
to obtain and analyze data more effectively.
3. Commercial mobile telephone and mobile data services are
provided by a large number of terrestrial CMRS operators as well as
mobile satellite operators. In an effort to provide the most complete
picture of competition to Congress, the CMRS Reports analyze CMRS
services from a consumer point of view. Therefore, some portions of our
analysis include offerings outside the umbrella of ``services''
specifically designated as CMRS by the Commission. Because providers of
these services may, on some level, compete with CMRS providers, the
Commission believes it is important to consider them in its analysis
and collects information on specific product categories regardless of
their regulatory classification.
4. In the Notice of Inquiry, we seek information that can be used
to examine the status of competition in the CMRS industry. We note in
our ongoing process of improving our data gathering process that we
have taken the step of issuing the Notice of Inquiry in an effort to
gather more detailed, comprehensive, and independent data for this
year's report. We request data that will allow us to evaluate the
extent to which consumers can choose among CMRS operators, services,
and technologies. In particular, we seek the following data and ask
commenters to address the following general questions:
[sbull] What is the current structure of the CMRS industry?
[sbull] Which entities compete to provide CMRS services?
[sbull] What have been the most significant changes or developments
in the industry over the past year?
[sbull] What is the extent of deployment of CMRS services?
[sbull] What is the state of competition in the provision of CMRS
services?
[sbull] How does competition in the CMRS marketplace vary across
the United States, in particular between rural and urban areas?
[sbull] What metrics are available that will give us insight into
the level of competition in the provision of CMRS services? We are
interested in, but not limiting commenters to, information on service
availability, the number of subscribers, penetration rates, usage,
average revenue per subscriber, churn, quality of service, pricing data
and trends, and profits.
[sbull] To what extent do key metrics, such subscribership and
usage levels, vary among different demographic groups?
[sbull] How does CMRS providers' cost of capital affect service
availability, including entry into new geographic markets, the quality
of service, and the introduction of new services? How is the cost of
capital related to the level of competition in the provision of CMRS
services? Is it possible to track the cost of capital that different
CMRS providers have faced and will continue to face over time?
[sbull] How does competition in the CMRS industry in the United
States compare to that in other countries? How do key CMRS industry
performance metrics, such as subscribership, usage, pricing, quality of
service, and service availability, vary between the United States and
other countries?
5. Industry members, interested parties, and members of the public
should submit information, comments, and analyses regarding competition
in the provision of CMRS services. Commenters that wish confidential
treatment of their submissions should request that their submission, or
a specific part thereof, be withheld from public inspection. In order
to facilitate our analysis of competitive trends over time, we request
that parties submit current data as well as data that are comparable
over time. In addition to the comments submitted in this proceeding,
the Eighth Report will also include information from publicly-available
and FCC sources.
II. Matters on Which Comment Is Requested
A. Competition in the Mobile Telephone Sector
i. Introduction
6. For purposes of the CMRS Reports, the mobile telephone sector is
defined to include all operators that offer commercially available,
interconnected mobile voice services. These operators provide access to
the public switched telephone network (``PSTN'') via mobile
communication devices employing radiowave technology to transmit calls.
The mobile telephone sector is dominated by providers using cellular
radiotelephone, broadband Personal Communications Service (``broadband
PCS''), and Specialized Mobile Radio (``SMR'') licenses. Because these
licensees offer mobile telephone services that are essentially
interchangeable from the perspective of most consumers, they have been
discussed in the CMRS Reports and are discussed in the Notice of
Inquiry as a cohesive industry sector.
7. For purposes of the Eighth Report, we seek information on
significant trends and developments that have occurred in the mobile
telephone sector since the publication of the Seventh Report.
Historically, the CMRS Reports have looked at the extent of service
availability as well as the number of consumers using mobile telephone
services. In addition, the CMRS Reports have looked at minutes of use,
average revenue per unit, churn levels, and pricing trends as
indicators of competition.
ii. Service Availability
8. The CMRS Reports include an analysis of the availability of
commercial mobile telephone service that the Commission uses to
evaluate competition in the U.S. mobile telephone industry. This
analysis has
[[Page 732]]
heretofore been based on publicly available information released by
operators, such as news releases, Securities and Exchange Commission
(``SEC'') filings, coverage maps available on operators' web sites, and
network buildout notifications filed with the Commission. The
statistics presented in the CMRS Reports based on this information
include the number of providers operating in a given geographic area,
the percent of the population living in areas with a certain number of
competitors, and the extent of coverage of the various network
technologies (e.g., analog, CDMA, TDMA, GSM, and iDEN). In the Third
and Fourth Reports, the geographic area used as the basis for these
analyses was Basic Trading Areas (``BTAs''); however, the subsequent
CMRS Reports have been improved and present this information on a more
disaggregated, county-by-county basis.
9. Previous CMRS Reports have included several notable caveats
about our analysis of the service availability. First, to be considered
as ``covering'' a county, an operator need only be offering any service
in a portion of that county. Second, multiple operators shown as
covering the same county are not necessarily providing service to the
same portion of that county. Consequently, some of the counties
included in this analysis may have limited coverage from a particular
provider. Third, the figures for POPs and land area in this analysis
include all of the POPs and every square mile in a county considered to
have coverage. Therefore, this analysis overstates to some degree both
the level of competition and total coverage in terms of both geographic
area and population covered. On the other hand, while newer broadband
PCS and SMR licensees have less complete networks that may be
overstated in our analysis, the original cellular licensees have
extensive networks that provide almost complete coverage of the entire
land mass of their license areas, and hence the entire land area of the
continental United States.
10. We ask for comment on how to improve the methodology we use to
determine service availability and evaluate competition. As described,
the methodology inherently includes some undetermined degree of
overcounting. Do commenters believe that this degree of overcounting is
significant and materially affects the determination of mobile
telephone service availability and competition? Is there an alternate
methodology that could be used to determine service availability and
competition?
11. In order to improve the accuracy of our analysis and to reduce
overcounting in the Eighth Report, we ask service providers to submit
as part of their comments to the Commission, in electronic format, the
coverage maps that they already make available to the public.
Specifically, we request carriers submit as part of their comments the
maps they employ to advertise their coverage areas in brochures and on
their web sites in a geo-referenced, mapable format, such as MapInfo
table (.tab) or Tagged Image Format (.TIF) files, on a CD sent to the
Commission. The Commission has used the contours filed by 800 MHz
cellular licensees to determine the availability of analog mobile
telephone service, and therefore does not require additional maps
showing analog coverage from cellular licensees. However, the
Commission requests that cellular licensees submit as part of their
comments their publicly-available maps in the aforementioned format
showing where they offer reliable digital service. In addition to the
coverage maps that carriers make available to the public, do carriers
have maps with more detailed coverage information that are not
available to the public? In the alternative, we ask carriers to please
indicate in their comments if they do not have such maps. Would
carriers or other parties be willing to submit such maps as part of
their comments?
12. Moreover, carrier provision of their publicly-available
coverage maps in electronic, geo-referenced format with clearly-defined
boundary lines, would enable the Commission to examine more precisely
the smaller geographic areas underlying the coverage boundaries, such
as zip code areas or census block groups. These small geographic areas
could therefore allow the Commission to make more accurate estimates of
the population and land area covered by a certain number of carriers or
served by a digital network.
13. In conducting our analysis of service availability and
competition, we seek information about the extent to which consumers
are able to, and do, purchase service plans from carriers whose
networks do not cover their residential location or billing address.
Carriers frequently query potential subscribers about the zip code of
their billing address. Should this be taken as an indication that
carriers do not provide service to consumers whose billing address zip
codes are outside the range of the carriers' network coverage areas,
even if such consumers wish to purchase service plans in order use
their phones inside the coverage areas? To what extent are mobile
telephone subscribers' residential locations or billing addresses
located outside of their carrier's network coverage area? To what
degree would an analysis of the population of smaller geographic areas
that underlie carriers' network coverage boundaries undercount those
subscribers? Furthermore, would the use of other, smaller geographic
areas in addition to or in place of counties be appropriate in
analyzing service availability? If so, which areas would be
appropriate? Do data currently exist on this basis?
14. In order to continue to improve the accuracy of our analysis,
we seek information on whether carriers market service to new customers
in all of the geographic areas in which they have coverage. Do carriers
provide coverage in certain areas, such as near major roads, where they
do not also market service to residents? If the latter is true, our
analysis could be further improved if carriers indicated the parts of
their coverage areas in which they compete to offer new service and the
parts that are used only to provide coverage to traveling subscribers
based in other locations. In addition to employing more accurate
coverage maps, in what other ways could our analysis of service
availability be improved?
15. We also seek data on the relationship between competition and
the availability of roaming for wireless customers. To what extent do
carriers have agreements that enable their customers to use automatic
roaming throughout the United States? Are there geographic areas in
which some carriers do not have automatic roaming agreements? If so,
where are those areas and is there any correlation to the number of
wireless providers operating in those areas? Are rural customers more
affected than non-rural customers? How many customers use manual
roaming? Where are those customers located when they use manual
roaming, and how frequent is their usage?
16. Finally, we seek comment on the fact that our service
availability analysis relies on information reported by service
providers, including their news releases, filings with the SEC, Web
site coverage maps, and network buildout notifications filed with the
Commission. In addition, there are independent web sites and public
reports that include some information about service coverage and dead
zones. There are risks to relying exclusively on data supplied by
parties with a financial stake in the use of such data as part of
Commission decisions. Since we, in some cases, report on information
supplied only by one or two sources, we
[[Page 733]]
also seek comment on ways of obtaining independent verification of
competition information provided for the report. Which independent
sources can be reliably used to verify carrier-supplied coverage
information? Do commenters believe such verification is necessary in
analyzing service availability and competition?
17. In addition to analyzing service availability by all
facilities-based mobile telephone carriers, previous CMRS Reports have
discussed ``nationwide'' mobile telephone operators. Companies that
analysts typically describe as being nationwide offer service in at
least some part of the western, midwestern, and eastern United States.
This label does not necessarily mean that the operator's license areas,
service areas, or pricing plans cover the entire land area of the
United States. The Seventh Report listed six carriers that analysts
typically describe as nationwide mobile telephone operators, all of
which, with their affiliates and partnerships, have licenses covering
between 230 and 285 million people. We seek comment on whether it is
appropriate to call these similarly situated operators ``nationwide''
mobile telephone operators. Is there other terminology that would
better describe the carriers that have a relatively large number of
licensed POPs and provide coverage in multiple large regions of the
United States?
iii. Market Performance and Key Metrics
18. The CMRS Reports have looked at a series of key metrics as
indicators of the demand for and reliance on mobile telephone service.
Examples of key metrics employed in the past include the number of
subscribers and penetration rates, average minutes of use per
subscriber per month (``MOUs''), average revenue per unit, and churn.
In addition, the CMRS Reports look at the prices for mobile telephone
services, including new developments in pricing plans; the extent of
digital service; and wireless-wireline competition. The sources of data
and analysis of these metrics are discussed. Are there other metrics or
techniques that should be used to analyze competition in the mobile
telephone sector? Are metrics available on a national and/or sub-
national level? What types of conclusions can and cannot be drawn from
the current and recommended metrics? For example, is service quality
related to competition? How would the Commission measure service
quality?
(a) Subscribership
19. One of the key metrics that provides an indication of the
demand for mobile telephone service is the total number of subscribers.
Prior to the Seventh Report, the Commission relied on estimated
national subscribership data from a semi-annual survey, started in
1985, conducted by the Cellular Telecommunications and Internet
Association (``CTIA''). Beginning with the Seventh Report, however, the
Commission was able to estimate the number of U.S. subscribers using
information filed directly with the FCC. This information, the
Numbering Report Utilization / Forecast (``NRUF'') data, tracks phone
number usage in the United States. All mobile telephone carriers must
report to the FCC which of their phone numbers they have assigned to
end users, thereby permitting the Commission to make an accurate
estimate of the total number of mobile telephone subscribers. As stated
in the Seventh Report, the Commission used NRUF data to estimate that
there were 128.5 million subscribers in the United States as of
December 31, 2001. The CTIA estimate for the same time was 128.4
million subscribers.
20. We seek comment on the use of NRUF data to estimate the total
number of U.S. mobile telephone subscribers. We also seek comment on
the continued use of CTIA's estimate from its semi-annual survey.
Furthermore, we request information from commenters on other data
sources that are available to determine the number of U.S. mobile
telephone subscribers and whether parties are willing to provide the
data. In addition, we request subscribership data that would assist in
a greater understanding of the competitive landscape, such as
penetration rates by age cohorts or household penetration rates.
21. The Commission also collects subscribership data as part of the
local competition and broadband data gathering program. Mobile
telephone carriers with more than 10,000 facility-based subscribers in
a state are required to report their number of subscribers in those
states twice a year to the Commission. Using this data, the Commission
reported that mobile telephone carriers had 122.4 million U.S.
subscribers as of December 31, 2001. For purposes of the Eighth Report,
we seek comment on whether this data should be used to draw any
conclusions about the mobile telephone sector, or whether it
undercounts subscribership to such a degree that it should not be
employed for such purposes.
22. NRUF data is submitted to the Commission on a rate center
basis. Rate center boundaries have in large part been determined by
incumbent local exchange carriers for their own network management
purposes. Because rate center boundaries are relatively small, the NRUF
data allows the Commission to make sub-national or regional estimates
of mobile telephone subscribership and penetration. However, there are
a number of disadvantages associated with using NRUF data for this
purpose. First, because CMRS carriers have wide latitude in choosing to
which rate center to assign a phone number across a large geographic
area, rate center boundaries are not necessarily indicative of where a
phone number assignee, and hence a mobile telephone subscriber, lives,
works, or uses her phone. In addition, rate center boundaries are not
coterminous with other boundaries frequently used in mobile telephone
analyses, such as counties, Cellular Market Areas (``CMAs''), or BTAs.
Furthermore, in order to protect the confidentiality of the companies
submitting NRUF data, the Commission does not report the number of
subscribers for geographic areas in which there are three or fewer
carriers.
23. For purposes of the Seventh Report, the Commission chose to use
Economic Areas (``EAs'') as the geographic unit for its sub-national
subscribership analysis using NRUF data, in part because it minimized
many of NRUF's drawbacks, discussed. EAs, which are defined by the
Department of Commerce, consist of one or more economic nodes and the
surrounding areas that are economically related to the node. One of the
main factors in determining the economic relationship between the
economic node(s) and the surrounding areas is commuting patterns, so
that each EA includes, as far as possible, the place of work and the
place of residence of its labor force. Because EAs are large enough to
include many rate centers and because they attempt to capture both the
rate centers in which subscribers have their numbers assigned and the
larger area in which they use their phones, an EA-based analysis
minimizes the pitfalls of the NRUF data while still providing useful
sub-national penetration information.
24. We ask for comment on how to determine which geographic area or
areas should be used, for purposes of the Eighth Report, to calculate
mobile telephone subscribership and penetration rates. We request
opinions on the appropriateness of using EAs for such calculations.
Would other geographic areas be appropriate to use in place of or in
addition to EAs, such as states, Major Trading Areas (``MTAs''), BTAs,
CMAs, or counties, noting the caveats of the NRUF data
[[Page 734]]
discussed? In addition, are there other ways to interpret existing
national and sub-national subscribership data for purposes of the
Eighth Report?
(b) Minutes of Use
25. To analyze mobile telephone usage, the Commission has used MOUs
as a key metric in the previous CMRS Reports. The Seventh Report
includes MOU estimates from CTIA, Paul Kagan and Associates, and J.D.
Power & Associates. All of these sources showed MOUs increasing
substantially during 2001. We seek comment on the use of MOUs as an
indicator of the demand for mobile telephone services as well as of the
level of competition in the mobile telephone sector. For purposes of
the Eighth Report, we ask for comment on the sources of the MOU data
presented in the Seventh Report and request additional MOU data. In
addition, should the Commission perform other analyses or draw
additional conclusions from new or existing data?
26. All of the MOU sources presented in the Seventh Report estimate
MOUs on a national basis. In order to increase the granularity of our
analysis for the Eighth Report, we request data on MOUs on a sub-
national basis and/or broken down by various demographic groups.
(c) Average Revenue Per Unit
27. Average monthly revenue per subscriber, often referred to as
average revenue per unit or ``ARPU'', is another key metric presented
in the CMRS Reports. One source of this metric is the industry-wide
ARPU figure reported by CTIA in its semi-annual mobile telephone
survey. In addition, many carriers report their individual ARPU figures
periodically in their SEC filings. We seek comment on the use of ARPU
as a metric in our analysis of the mobile telephone industry. Is ARPU a
useful metric when analyzing competition? Is there a link between
changes in ARPU and changes in competition? Is additional ARPU data
available that should be considered, in particular data depicting
whether and how ARPU varies by region and/or demographic group? Are
there additional analyses that can be performed or conclusions that can
be drawn in the Eighth Report from new or existing data?
28. CTIA reported that ARPU declined almost continuously from 1987
to 1999, going from a peak of $98.02 in December 1988 to a low of
$39.43 in December 1998. However, since 1999, ARPU has been increasing,
rising to $47.37 in December 2001. The Seventh Report concluded that
the growth in ARPU might be the result of a variety of factors,
including increased usage offsetting per-minute price declines, as well
as the adoption of higher-priced monthly calling plans by consumers. We
request from commenters additional input on the possible causes for the
recent rise in ARPU, as well as additional data that may support
various hypotheses. What role, if any, do changes in ARPU have on
competition?
(d) Churn
29. Churn, a fourth key metric used in the CMRS Reports, refers to
the number of customers an operator loses over a given period of time.
The Seventh Report discussed churn estimates from Merrill Lynch,
Salomon Smith Barney, and Telephia. Some of data included in these
sources is reported by carriers, many of whom reveal their churn rates
periodically in their SEC filings. Are there other sources of churn
data available that should be included in the Eighth Report?
30. We seek comment on the use of churn rates as a tool in our
analysis of the mobile telephone industry, including to what extent
churn rates are a reflection of competition in this industry. We ask if
there are additional analyses that can be performed or conclusions that
can be drawn from churn data in the Eighth Report. Do commenters
believe the churn data we have included in previous reports is
reliable?
31. The Telephia data presented in the Seventh Report included
estimates of churn for selected metropolitan areas including Chicago,
Los Angeles, New York, San Francisco, and Washington D.C. To improve
our analysis of the mobile telephone industry in the Eighth Report, we
request additional sub-national or regional churn data, as well as
churn data by demographic groups.
iv. Pricing Data and Trends
32. The Seventh Report contained pricing data from a series of
sources, all of which indicated that the average price of mobile
telephone service has been decreasing over time. The Seventh Report
cited information from the U.S. Department of Labor's Bureau of Labor
Statistics (``BLS''), Econ One, and trends based on CTIA data. Using
CTIA data, we calculated a national average of revenue per minute
(``RPM'') by dividing ARPU by MOUs. We used this RPM figure as an
estimate of the average price per minute of mobile telephone service.
RPM has been declining every year since 1995. BLS began reporting a
cellular telephone component of the Consumer Price Index (``CPI'') in
December 1997 (``cellular CPI''). The cellular CPI decreased 5.5
percent during 2001, and 32.8 percent between 1997 and 2001. The CPI,
which includes the cellular CPI, represents approximately 87 percent of
the U.S. population, and includes expenditure patterns of some of the
rural populations. Do commenters believe the cellular CPI should be
considered representative of national pricing trends? In contrast to
our estimate of RPM and BLS's cellular CPI, which attempt to capture
national pricing trends, Econ One analyzes pricing plans for the top 25
U.S. cities. The firm also calculates the average price of service
across four different monthly usage levels and derives, from that data,
an average for all users. Econ One found that the average price of
service (across all usage levels and 25 cities) declined 7.3 percent
during 2001, following a 6.9 percent decline in 2000.
33. We seek comment on the use of these various pricing estimates
as a tool in our analysis of the mobile telephone industry, including
to what extent price decreases are evidence of competition in the
mobile telephone sector. We ask for feedback on the sources of the
pricing data used in the Seventh Report and request additional national
and sub-national pricing data for the Eighth Report. Are there
additional analyses that can be performed or conclusions that can be
drawn from new or existing pricing data?
34. The CMRS Reports have also examined new types of pricing plans
introduced during the past year in order to report on major
developments in the industry and to assess the new plans' impact on
competition. To what extent do new types of pricing plans both reflect
a competitive industry and stimulate competition among providers? What
are the major innovations that have occurred with pricing plans since
the Seventh Report?
35. We seek information on which carriers offer nationwide pricing
plans, particularly those that are not typically described as being
nationwide operators, and request descriptions of the terms of such
plans. We ask carriers that offer nationwide pricing plans whether they
offer the same rates and terms to consumers throughout all parts of the
country where they offer such plans, including Alaska, Hawaii, and
Puerto Rico. Furthermore, do carriers charge different prices--both
monthly and per minute--or offer different terms for their local and
regional plans across the various areas that they serve? If so, are
these geographic variations substantial, and what are the major reasons
for such variations?
[[Page 735]]
36. Is pricing data available on whether certain types of pricing
plans are associated with specific demographic cohorts or types of
users? For example, do subscribers with lower personal or household
incomes tend to purchase pricing plans with lower monthly fees? Are
particular plans associated with teenagers or college students? Are
prepaid services used by a group of consumers with similar
characteristics? Have the introduction of new types of pricing plans
increased mobile telephone penetration among specific demographic
groups or in certain geographic areas?
v. Geographic Comparisons: Urban versus Rural
37. Since the release of the Sixth Report, the Commission has
attempted to obtain a better understanding of the state of competition
below the national level, in particular in rural areas. To begin with,
we ask commenters to address whether an urban/rural distinction is
meaningful in the context of mobile telephone service, given the
varying types of geographic areas in which consumers use their mobile
phones and carriers offer plans.
38. To the extent that it is meaningful to analyze mobile telephone
service availability in rural areas, we seek comment on how best to
determine whether competition has developed successfully in rural
areas. We invite parties to comment on what data is available to
address this issue and whether they believe there is meaningful
competition among mobile telephone providers in rural areas.
39. The primary difficulty for the Commission in examining the
state of competition in rural areas has been the lack of sub-national
data. Prior to the release of the Seventh Report, the Commission held a
Public Forum to gather more insights into and data about CMRS service
availability in rural areas. Much of the information gathered was
anecdotal. Therefore, additional data is needed, and we seek comment
and information on three topics related to mobile telephone service
availability in rural areas: (i) the definition of rural, (ii) service
availability and network deployment, and (iii) market performance and
key metrics.
40. Do services, pricing plans, and technologies differ between
rural areas and urban areas? Do the providers who serve both areas
offer the same products and prices in each type of area?
(a) Definition of Rural
41. In order to analyze mobile telephone service availability and
competition in rural areas, it is necessary to first define what
geographic area(s) constitutes ``rural.'' The federal government has
multiple ways of defining rural, reflecting the multiple purposes for
which the definitions are used. The Commission has used Rural Service
Areas (``RSAs'') to define ``rural'' in certain instances. In the CMRS
spectrum cap proceeding, the Commission designated RSAs as rural areas
and stated, ``Other market designations used by the Commission for
CMRS, such as [EAs], combine urbanized and rural areas, while MSAs and
RSAs are defined expressly to distinguish between rural and urban
areas.'' Since passage of the Telecommunications Act of 1996, the
Commission generally has used the statutory definition to determine
which local exchange carriers can be classified as rural telephone
companies. That definition uses a range of standards including the
population of a jurisdiction and the number of access lines serving
communities of various sizes.
42. In the Seventh Report, we used three different proxy
definitions of rural for purposes of analyzing the average number of
competitors in rural versus non-rural counties. We compared the number
competitors in (i) RSA counties versus MSA counties, (ii) non-nodal EA
counties versus nodal EA counties, and (iii) counties with population
densities below 100 persons per square mile versus those with
population densities above 100 persons per square mile.
43. We request comment on whether and how the Commission should
define rural for purposes of the Eighth Report. What elements should
the Commission consider when defining ``rural''? Should there be a
single delineation between rural and non-rural areas, or should rural
be defined on a continuum? For example, should the Eighth Report define
different degrees of ``ruralness'' based on population density?
(b) Rural Service Availability
44. As mentioned, the Commission analyzed service availability in
rural areas in the Seventh Report using three different proxy
definitions for rural. The analysis resulted in similar results for
each definition. Non-rural counties had an average of 5.5 to 5.7
service providers, while rural counties had an average of 3.1 to 3.3
competitors. We ask whether the existence of fewer facilities-based
providers in rural areas necessarily indicates the existence of less
meaningful competition in these areas.
45. When examining service availability in rural areas, should the
Commission continue to use multiple definitions of rural for purposes
of the Eighth Report? Were the three definitions employed in the
Seventh Report appropriate proxies to use in assessing competition in
rural areas? Are there other geographic definitions that should be
employed in the Eighth Report? Is data available that would allow an
analysis using other definitions?
46. In addition to addressing rural issues generally, we also take
this opportunity to focus on access to telecommunications services by
individuals living on tribal lands. In our Report and Order
implementing auction bidding credits for those who commit to serving
federally-recognized tribal lands, we noted that communities on tribal
lands have had less access to telecommunications services than any
other segment of the U.S. population. According to the 1990 Census,
only 53 percent of those living on tribal lands had basic telephone
service, as opposed to 94 percent for the United States as a whole.
Further, a 1999 study commissioned by the U.S. Department of Commerce's
Economic Development Administration found that the average penetration
rate for basic telephone service on reservation and trust lands in
rural areas was just 39 percent. Therefore, it may be appropriate to
examine closely the state of telecommunications access not only in
rural areas, but more specifically on tribal lands.
47. We seek comment on whether the Eighth Report should
specifically address the state of mobile telephone competition on
tribal lands. If so, what issues are present on tribal lands that
warrant separate consideration from other rural areas with similar
population levels? In examining services available on tribal lands,
should we limit our consideration to services available to individuals
who live within federally-recognized tribal lands, or should we also
include other nearby areas where Native Americans may live? If so, we
ask that commenters provide details regarding which areas should be
included in our discussion, and provide information or information
sources for obtaining sufficiently granular data about services in such
areas.
(c) Rural Metrics
48. As discussed, the CMRS Reports have looked at key metrics as
indicators of the demand for mobile telephone service and competition
among mobile telephone providers. These metrics include the number of
subscribers, MOUs, ARPU, churn, and pricing data. Historically, all of
these metrics have
[[Page 736]]
been presented on a national basis, although sub-national
subscribership and pricing data were included in the Seventh Report.
Furthermore, we have requested sub-national or regional data for all of
these metrics in sections II.A.iii. and II.A.iv., supra.
49. At this point, we request data for all of these metrics on a
sub-national level and ask what the data show about differences between
urban and rural areas in terms of demand and competition. Does
information currently exist demonstrating differences in
subscribership, MOUs, ARPU, churn, and prices in urban versus rural
areas? If so, would commenters be willing to provide such information?
50. Beginning with the Seventh Report, we presented subscribership
figures on an EA basis using NRUF data. Should the Commission use NRUF
data to determine subscribership and penetration rates in rural areas,
however they may be defined? Would the NRUF data be able to provide
accurate and meaningful statistics on rural subscribership given the
limitations of the data discussed? Are there other sources of
information that could be used to determine the number of subscribers
and penetration rates in rural areas?
51. The Commission knows of few studies that have been done
comparing mobile telephone pricing in urban versus rural areas.
However, Econ One has completed one study, which it presented at the
Public Forum and which we included in the Seventh Report, that compared
pricing in the 25 largest U.S. cities (with an average population of
4.4 million) with 25 randomly-selected towns or cities (with an average
population of 95,611) located in RSAs. For purposes of its analysis,
Econ One considered the towns or cities located in an RSA to be rural
areas. The company reported very similar pricing in these two groups of
cities. However, while the mean prices for monthly service in urban and
rural areas were similar, there was a wider range of prices in rural
areas than in urban areas. We ask for additional information on whether
there are meaningful pricing differences between urban and rural areas.
To the extent that such differences exist, what are the reasons for
such differences? Should additional analyses on the differences between
urban and rural mobile telephone pricing be performed? What additional
conclusions can be drawn, and what are the limitations of those
conclusions?
52. Finally, to what extent do nationwide carriers affect prices
and competition in rural areas, even if such carriers do not offer
service in those areas? Do these carriers create the same competitive
pressures in rural areas that they do in urban areas?
vi. Wireless-Wireline Competition
53. Mobile telephone service has been considered both a complement
to and a substitute for wireline services. Historically, most consumers
used their mobile phones as a mobile complement to their wireline
phones by using their mobile handsets only when away from their homes
or places of work. However, as noted in the Seventh Report, an
estimated 3 to 5 percent of consumers have ``cut the cord,'' meaning
they do not subscribe to wireline phone service. The Seventh Report
included information about consumers who consider their mobile phones
their primary phone but may still continue to have a wireline phone.
Moreover, the Seventh Report noted that, due to the fact that several
mobile telephone packages have extensive local service areas and/or
include free long distance, many consumers now use their mobile phones
instead of their wireline phones to make ``long distance'' calls.
54. In order to track and analyze competition between mobile
telephone and wireline services more effectively, we request data on
(i) The number of mobile telephone subscribers who do not subscribe to
residential wireline service, (ii) the percentage of consumers' total
monthly voice communication minutes that are made from mobile phones,
(iii) the percentage of consumers' total monthly long distance minutes
that are made from mobile phones, (iv) the percentage of mobile
telephone subscribers' calls and minutes that occur in their homes
using their mobile phones, (v) the percentage of both mobile telephone
and wireline calls and minutes that terminate on mobile phones, and
(vi) demographic data on which groups of consumers have allocated a
substantial portion of their voice communications to mobile telephone
service. Should the Commission gather additional data, perform
additional analyses, or draw new conclusions on wireless-wireline
competition?
55. The CMRS Reports have also discussed the effects of mobile
telephone service on the operational and financial results of companies
that offer wireline services. Such effects include a decrease in the
number of residential access lines, a drop in long distance revenues,
and a decline in payphone profits. To what extent is the increase in
mobile telephone usage a major cause of these developments, and why?
Given these developments, we ask for comment on the extent to which
mobile telephone service competes with wireline service. What other
effects has mobile telephone service had on the provision of other
telecommunications services by other service providers? What new
developments in wireless-wireline competition have occurred since the
Seventh Report? What are the major reasons for these developments?
vii. Satellite Operators
56. Satellite operators offer mobile telephone services which, from
a consumer's point of view, have many of the same characteristics as
terrestrial-based mobile telephone services. At least four carriers
currently provide mobile satellite services (``MSS'') in the United
States: Globalstar Telecommunications LTD, Iridium Satellite LLC,
Inmarsat Limited, and Mobile Satellite Ventures. We request that these
carriers submit as part of their comments information detailing the
geographic areas of the United States in which they provide coverage as
well as those areas in which they offer service to new customers.
Taking into account such information on MSS service availability, we
seek comment on the extent of competition among MSS providers. To what
extent do MSS providers compete with terrestrial-based mobile telephone
providers? Are MSS services substitutes for terrestrial-based mobile
telephone and data services? Should MSS providers be considered an
additional service provider in the analysis of service availability in
the Eighth Report, or do they offer services that generally are not
substitutes for services provided by terrestrial CMRS carriers, even
though they fall under the legal umbrella of CMRS?
viii. Resellers
57. Resellers offer service to consumers by purchasing airtime at
wholesale rates from facilities-based providers and reselling it at
retail prices. According to information provided to the Commission in
its ongoing local competition and broadband data gathering program, the
resale sector accounted for approximately 5 percent of all mobile
telephone subscribers as of December 2001. To what extent are resellers
creating competitive pressures in the mobile telephone sector? In 2002,
WorldCom, which claimed to be the largest reseller of post-paid
wireless service the United States, announced that was abandoning the
resale business. Who are the remaining major resellers? How many
subscribers do they have? From a consumer perspective, what are the
benefits of buying from a reseller versus a facilities-based provider?
Are resellers selling to specific demographic
[[Page 737]]
segments? The Seventh Report discusses ``mobile virtual network
operators'' (``MVNOs'') that are a type of reseller that focuses on
brand development, with the intent to offer a niche product and to have
better customer retention. An example of an MVNO is Virgin Group LLC
(``Virgin''). Virgin has an arrangement with Sprint PCS whereby Virgin
markets prepaid mobile telephone service using Sprint PCS's network. We
ask for comment on how this resale model has affected the provision of
resale services. We also ask for information about companies that have
employed the MVNO resale model since the Seventh Report.
ix. International Developments
58. The Seventh Report compared the mobile telephone sectors in the
United States, Western Europe, and parts of the Asia-Pacific by
examining a number of performance measures, including penetration
levels, subscriber growth, MOUs, and pricing. The scope of
international comparisons in the Seventh Report and previous CMRS
Reports has been constrained by the availability of comparable
international data. For the purposes of the Eighth Report, we seek data
to update and possibly expand upon these international comparisons.
59. The international comparisons in the Seventh Report were based
on various sources of data that were generally current as of the second
half of 2001. We request suggestions on sources of data for updating
international comparisons of penetration levels, subscriber growth, and
usage for the year 2002.
60. The Seventh Report used Organization for Economic Co-Operation
and Development (``OECD'')/Teligen mobile service baskets and revenue
per minute (``RPM'') estimates to compare mobile telephone pricing in
the United States, Canada, and parts of Western Europe and the Asia-
Pacific. We request recommendations on alternative methods of comparing
mobile telephone pricing in different countries and associated sources
of data. We also seek suggestions on sources of data for updating the
international comparison of RPM.
61. We also invite suggestions on additional performance measures
and associated data sources for comparing the U.S. mobile telephone
sector with those in other countries.
B. Competition in the Mobile Data Sector
i. Introduction
62. For purposes of its CMRS Reports, the Commission considers
mobile data to be the delivery of non-voice information to a mobile
device. Two-way mobile data services include not only the ability to
receive non-voice information on an end-user device but the ability to
send it from an end-user device to another mobile or landline device
using wireless technology. The Seventh Report concluded that
competition within the mobile data sector is developing successfully,
as evidenced by the multitude of dynamic services, service packages,
and pricing plans available to consumers from a variety of providers.
63. For purposes of the Eighth Report, we seek information on the
significant changes and developments that have occurred in the mobile
data industry since the publication of the Seventh Report. Do
commenters believe that competition is continuing to develop
successfully within the mobile data sector?
64. In analyzing competition within the mobile data industry, it is
necessary to consider the relationship between mobile data and mobile
telephone service. Both services are offered by many of the same
providers using the same networks and end user devices, yet differences
in the nature of the two services exist. Hence, to what extent are the
mobile data and mobile telephone sectors separate, and to what extent
are they converging?
65. Related to this issue of convergence, the Seventh Report
discussed the emergence of smartphone devices during 2001 and 2002 that
combine the organization and data-centric features of personal digital
assistants (``PDAs'') with the voice capabilities of mobile telephones.
We seek comment on the extent to which the emergence of smartphones has
signified a convergence between mobile data and mobile telephone
service, and we seek data on the growth in the number of users of these
devices. How many smartphones have been sold in the United States? What
types of consumers purchase smartphones? What are the features and
capabilities of the various devices? Finally, have there been any new
developments related to smartphones since the Seventh Report?
ii. Services & Content
66. The Seventh Report described three general categories of mobile
data providers and their corresponding devices: (i) mobile telephone
operators offering services primarily on mobile telephone handsets,
(ii) providers of mobile data access to handheld PDA devices and laptop
computers, and (iii) paging carriers offering services on pagers and
two-way messaging devices. However, in analyzing subsectors within the
mobile data industry, for several reasons we have found it most
effective to segregate the industry not along the lines of devices,
spectrum bands, or network technologies, but instead along the lines of
the types of services available to consumers. First, the types of
mobile data services available to consumers have become increasingly
similar across devices. Many of the same mobile data services are
available on mobile telephone handsets, PDAs, smartphones, and laptop
computers. With the exception of traditional one-way pagers, most
mobile data devices have the ability to offer some form of text
messaging, web browsing, and e-mail access. Second, carriers use a
variety of different spectrum bands--including broadband PCS, cellular,
and SMR--and a variety of different network technologies--including
CDMA, GSM, cdma2000 1xRTT (``1xRTT''), and General Packet Radio Service
(``GPRS'')--to provide many of the same mobile data services.
67. The types of services discussed in the Seventh Report include:
Paging, Short Messaging Service (``SMS'') and instant messaging
(``IM''), web browsing, e-mail and corporate server access, location-
based services, and short range data transmissions. Are there
additional categories that should be analyzed in the Eighth Report?
What new and innovative services are mobile data providers offering? In
addition, we seek comment on the extent to which mobile data services
are substitutes for or complements of one another? For example, do
messaging services compete with e-mail services? Are web browsing
services a complement to e-mail access? Which services are most often
bundled together, and why?
68. In addition to seeking data on the level of competition among
different mobile data services, we request information on the extent to
which mobile data services compete with data services offered through
wireline devices. For example, have mobile e-mail services been a
substitute for e-mail access on a personal computer offered through a
dial-up, Digital Subscriber Line (``DSL''), or cable modem connection?
69. Furthermore, we request data on the growth and success of the
various mobile data services. Which services are most popular with
consumers and have the highest adoption rates? In what
[[Page 738]]
ways do services offered over 1xRTT and GPRS networks differ from those
offered over 2G networks?
70. In addition to requesting comment on mobile data services
generally and the economic relationship between these services, we also
seek information related to specific mobile data services.
(a) Paging
71. Traditional paging service consists of a one-way data
communication sent to a mobile device that alerts the user when it
arrives. The communication usually consists of a phone number for the
user to call, but could also contain a short text message or
information update. As discussed in the various CMRS Reports, the
number of subscribers to traditional one-way paging services has been
declining over the past few years. In addition, all of the major paging
carriers have filed for bankruptcy reorganization over the past two
years. Do commenters foresee continued demand for one-way paging
services? If so, who are the major purchasers of one-way paging
services? What specific advantages do one-way paging services offer for
these consumers versus other services? How many paging subscribers also
own a mobile telephone?
(b) Web Content
72. As explained in the Sixth and Seventh Reports, mobile web
browsing services allow users to access content from the World Wide Web
on a mobile device. The web browsing services offered can vary by
provider and by device in both the type and amount of content that
users can receive. For example, mobile web subscribers using laptops
may be able to connect to any web page and view graphical content,
while users accessing the web from a mobile telephone handset may be
able to view only a limited number of text-based web pages that have
been redesigned for mobile devices. Furthermore, some carriers limit
the web sites that users can access to those with which they have a
content agreement.
73. We invite commenters to address the extent to which users have
a choice of which content they receive. Can users of mobile web
services access any web site, only those have been re-designed for
access on mobile device, or only those with whom the carrier has a
content agreement? Approximately how many web sites have been specially
designed for use on a mobile device?
74. Have there been any notable technological developments in the
past year that have facilitated a greater availability of mobile web
browsing services?
(c) Text Messaging
75. As mentioned in the Seventh Report, SMS provides the ability
for users to send and receive text messages to and from mobile devices
with maximum message length ranging from 120 to 500 characters. We seek
data on the growth rate of SMS in the United States over the past
several months. How many SMS messages have been sent in the United
States over time?
76. Furthermore, as of mid-2002, most of the major mobile telephone
carriers had introduced the ability to exchange text messages with
subscribers on other carriers' networks. We seek information on how
this intercarrier interoperability has affected SMS adoption rates and
the volume of SMS traffic.
77. In addition to offering SMS, some carriers offer IM services.
Instant messaging services, such as AOL Instant Messenger (``AIM'') and
MSN Messenger, enable users to send and receive messages within a
community of users, creating a chat-style atmosphere, whereas SMS is a
communication between two individuals. From their mobile devices, AIM
users are able to tell whether or not someone from their ``buddy
list''--a list of other AIM users with whom the initial user
communicates--is online. In addition, AIM users can communicate with
their buddies regardless of whether they are on a desktop computer or a
mobile telephone. AT&T Wireless, Sprint PCS, T-Mobile, and Palm have
offered AIM to their users, while Verizon Wireless and Cingular
Wireless have offered MSN Messenger. Unlike with SMS, open access or
interprovider interoperability is not available with IM services; AIM
users cannot exchange messages with users of MSN Messenger. To what
extent have these access and interoperability issues affected demand
for instant messaging services in the mobile data sector?
78. As mentioned, the Commission invites comment of the extent to
which the various mobile data services compete with each other. In
particular, we ask to what extent text messaging and e-mail are
substitutes for each other. In what ways do the features and
capabilities of the two services vary?
(d) E-mail and Corporate Server Access
79. As discussed in the Seventh Report, a variety of services are
available to consumers that allow them to receive e-mail messages while
mobile from an existing home- or work-based e-mail account. We seek
information from commenters on the specific capabilities of these
various mobile e-mail services. To what extent are features such as
forwarding and deleting integrated with consumers' other e-mail
accounts? Are users able to view attachments? In addition, we seek
information on the specific capabilities of services that allow users
to access corporate intranets or files stored on corporate servers from
a mobile device.
80. With regard to both types of services, we seek information on
how much data or content a user can download, and how quickly and
reliably. Furthermore, are these services secure? What level of
security and/or encryption is offered by these various services?
iii. Devices
81. Mobile data services, and in particular mobile Internet
services, are offered on a variety of end-user devices. Which devices
are used most for mobile Internet access? Furthermore, do any of the
features of mobile data devices--such as battery life, data storage
capacity, and screen size--constrain the ability of users to access
mobile Internet services, and therefore limit the demand for such
services? Which features on which devices might limit mobile Internet
access the most?
iv. Subscribership
82. In addition to seeking information on the capabilities of the
various mobile data services discussed, we also request data on the
number of subscribers to and users of mobile Internet services. How
many people in the United States subscribe to or use any type mobile
Internet service? Do most mobile Internet users also subscribe to
mobile telephone service? How many people use the different types of
mobile data services, including paging, SMS, IM, web browsing, e-mail,
and corporate server access? In the Seventh Report, we used NRUF data
to estimate the number of paging subscribers at the end of 2001. Do
commenters agree that this is a reliable method for calculating the
number of subscribers to that particular service?
83. How many people subscribe to or use higher-speed mobile
Internet services provided over 1xRTT and GPRS networks? How does
subscribership to the various mobile data services vary by geographic
region and among various demographic groups?
v. Service Availability
84. In preparation for the Eighth Report, we request information on
the availability of mobile data services offered over 2G mobile
networks, as well as higher-speed mobile data
[[Page 739]]
services offered over 1xRTT and GPRS networks.
85. Do carriers offer any type of mobile Internet service in any
portion of their service areas? In what percentage of their license and
network footprints do carriers offer mobile Internet services? Are the
same types of services available in all areas? What percent of
carriers' licensed and network POPs are located in the areas where
mobile Internet services are available? Does mobile data service
availability vary between urban and rural areas?
86. The Seventh Report summarized the deployment of next-generation
network technologies 1xRTT and GPRS on a county-by-county basis as of
March 2002. For purposes of the Eighth Report, we seek information on
the extent to which carriers have continued to upgrade their networks
with these next-generation technologies since March 2002. In what
portion of their license and network footprints have carriers deployed
1xRTT or GPRS, and in what portion do they offer advanced wireless
services using these technologies? Are the same types of advanced
wireless services available in all areas? Does the availability of
advanced wireless services vary between urban and rural areas? What
percent of carriers' licensed and network POPs are located in the areas
where 1xRTT or GPRS-based mobile data services are available?
Furthermore, what percent of the U.S. population has access to advanced
wireless services provided by 1xRTT and/or GPRS?
87. Furthermore, we request comment on the actual data transfer
speeds that most users experience with GPRS and with 1xRTT. Do the two
technologies differ in this respect? To what degree are individual
users' data transfer speeds depleted as more users log on to the
network in a given area?
88. Finally, we request information on the extent to which mobile
data providers are upgrading or plan to upgrade their networks with
additional next generation technologies beyond GPRS and 1xRTT, such as
EDGE, WCDMA, and 1X-EV.
vi. Pricing
89. In analyzing competition in the mobile data industry and the
general evolution of this sector, we have examined the prices charged
by providers for various mobile data services. While the analysis of
pricing in the mobile telephone sector includes an estimate of per-
minute pricing, such an estimate is not feasible in the mobile data
sector given the variety of services and the variety of pricing
techniques used by carriers. Therefore, the previous CMRS Reports have
summarized and compared, in some cases over time, the different prices
carriers charge as well as various pricing methods they use.
90. For the Eighth Report, we request data from providers on the
prices they charge for the various mobile data services they offer. How
have these prices changed over time?
91. In addition to asking for actual pricing data, we also seek
comment on the general trends related to mobile data pricing. To what
extent do providers bundle mobile data services with each other and
with voice service? Do providers offer mobile data services as add-ons
service to voice service or as standalone services? Are mobile data
services offered on a per-use basis or on a monthly subscription basis?
Finally, do providers charge for mobile data services by the megabyte
of data, by the minutes of usage, by the incremental service, and/or do
they offer a flat rate for unlimited usage?
92. In addition, we seek information on the degree to which mobile
data providers, in their pricing plans and marketing efforts,
distinguish between mobile Internet services offered over 2G networks
and those offered over next-generation 1xRTT and GPRS networks.
93. Are the prices of mobile data services generally the same
across all the geographic areas in which carriers offer them? Do the
prices vary by region, in particular between urban and rural areas? To
the extent that they do vary by region, what are the reasons for this?
vii. WiFi
94. Over the past year, the WLAN technology, Wireless Fidelity or
WiFi, has begun to play an increasingly important role in the mobile
data industry. WiFi operates in the unlicensed spectrum bands using
primarily the 802.11 wireless technology standards and allows data
transfer speeds of up to 11 Mbps. While WiFi is not a CMRS service per
se, we included a discussion of it in previous CMRS Reports because of
its potential to affect the provision of CMRS services.
95. Users of mobile devices with WiFi capabilities or attachments
can establish a high-speed, wireless connection to the Internet within
a variety of settings, including restaurants, coffee shops, hotels,
airports, convention centers, office buildings, and college campuses.
These buildings or campuses generally connect to the Internet via a
high-speed wireline technology such as a T-1 line, and WiFi users lose
their high-speed wireless connections once they exit these settings.
Given both the advantages and limitations of WiFi, do commenters
believe that it competes with commercial, interconnected mobile data
services? Does WiFi have the potential to compete with these services
to a greater extent in the future?
96. For purposes of the Eighth Report, we request data on the
current extent of WiFi deployment and usage. How many people or what
percent of the U.S. population subscribes to or uses WiFi services? In
how many locations is WiFi currently available, and in which types of
locations do most users establish WiFi connections? What data transfer
speeds do most users experience with the various WiFi technology
standards, including 802.11a, 802.11b, and 802.11g? In addition, what
are the major drawbacks of WiFi access? To what degree are WiFi
connections secure for end users? What, if any, interference problems
are associated with WiFi access? Are voice services possible and
available using WiFi connections?
97. Finally, we seek information on the other uses of unlicensed
spectrum besides WiFi. Are both voice and data services available
through these other types of connections? What is the extent of
deployment of these other services?
III. Fixed Voice and Data Services
98. In addition to providing an analysis of competition in the
commercial mobile services industry, the CMRS Reports have also
included an appendix providing an overview of the current state of the
fixed wireless industry. Some licensees of spectrum bands traditionally
used for CMRS are using that spectrum to provide fixed wireless
services. Furthermore, because most fixed wireless carriers have
typically offered two-way, high-speed data services, the fixed wireless
sector is discussed in greater detail in the Commission's annual report
on the deployment of broadband services, pursuant to section 706 of the
Telecommunications Act of 1996.
99. With the Notice of Inquiry, the Commission seeks the data from
commenters on the state of the fixed wireless industry to incorporate
into the Fixed Wireless Appendix of the Eighth Report. Who are the
major providers of fixed wireless services? Have the carriers that
experienced financial difficulties over the past two years made
progress towards recovery and formed new business strategies? Which
spectrum bands are currently being used by operators to deploy fixed
services, including the unlicensed spectrum bands? In what portion of
the United States, measured by both population and land area, are fixed
wireless services available? To what extent have fixed wireless
networks been deployed in rural areas? How many fixed wireless
[[Page 740]]
systems employ unlicensed spectrum? How many businesses and households
currently subscribe to fixed wireless services? What are the typical
data transfer rates offered by the various fixed wireless systems? Have
there been in any major technological innovations that have affected
the fixed wireless industry over the past year?
IV. Procedural Matters
A. Ex Parte Presentations
100. This is an exempt proceeding in which ex parte presentations
are permitted (except during the Sunshine Agenda period) and need not
be disclosed.
B. Filing of Comments and Reply Comments
101. We invite comment on the issues and questions set forth.
Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's rules, 47
CFR 1.415, 1.419, interested parties may file comments on or before
January 27, 2003, and reply comments on or before February 11, 2003.
Comments may be filed using the Commission's Electronic Comment Filing
System (ECFS) or by filing paper copies. See Electronic Filing of
Documents in Rulemaking Proceedings, 63 FR 24121 (May 1, 1998).
102. 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. If multiple docket or rulemaking numbers
appear in the caption of this proceeding, however, commenters must
transmit one electronic copy of the comments to each docket or
rulemaking number referenced in the caption. In completing the
transmittal screen, commenters should include their full name, U.S.
Postal Service mailing address, and the applicable docket or rulemaking
number. Parties may also submit an electronic comment by Internet e-
mail. To get filing instructions for e-mail comments, commenters should
send an email to ecfs@fcc.gov, and should include the following words
in the body of the message: ``get form.'' A sample form and directions
will be sent in reply. Parties who choose to file by paper must file an
original and four (4) copies of each filing. Parties choosing to
submit, as part of their comments, map files in response to requests in
paragraphs 11 through 14, paragraph 56, or paragraph 86, supra, should
submit a CD (compact disc) containing one copy of the maps of their
service areas, with the various distinctions described, in a format,
either MapInfo table (.tab) or Tagged Image Format (.TIF), that will
allow Commission staff to open and use these files in MapInfo
Professional software, version 6.0. If you have questions about
submitting map files, please contact Chelsea Fallon at (202) 418-7991.
Paper filings and CDs containing map files can be sent by hand or
messenger delivery, by commercial overnight courier, or by first-class
or overnight U.S. Postal Service mail (although we continue to
experience delays in receiving U.S. Postal Service mail). The
Commission's contractor, Vistronix, Inc., will receive hand-delivered
or messenger-delivered paper filings for the Commission's Secretary at
236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The
filing hours at this location are 8 a.m. to 7 p.m. All hand deliveries
must be held together with rubber bands or fasteners. Any envelopes
must be disposed of before entering the building. Commercial overnight
mail (other than U.S. Postal Service Express Mail and Priority Mail)
must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.
U.S. Postal Service first-class mail, Express Mail, and Priority Mail
should be addressed to 445 12th Street, SW., Washington, DC 20554. All
filings must be addressed to the Commission's Secretary, Office of the
Secretary, Federal Communications Commission. Parties also should send
four (4) paper copies of their filings to Chelsea Fallon, Federal
Communications Commission, Room 4-A335, 445 12th Street, SW.,
Washington, DC 20554.
V. Ordering Clauses
103 Accordingly, it is ordered that, pursuant to the authority
contained in sections 4(i), 4(j), and 403 of the Communications Act of
1934, as amended, the Notice of Inquiry is adopted.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 03-218 Filed 1-6-03; 8:45 am]
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