FR Doc 05-9097

[Federal Register: May 11, 2005 (Volume 70, Number 90)]
[Proposed Rules]
[Page 24740-24748]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr11my05-12]

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[WC DOCKET NO. 03-225; FCC 05-71]

Request To Update Default Compensation Rate for Dial-Around Calls
From Payphones

AGENCY: Federal Communications Commission.

ACTION: Further notice of proposed rulemaking.

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SUMMARY: In this document, the Commission seeks current and accurate
data on the average number of compensable dial-around calls made from
payphones on a monthly basis. This average monthly data will be used to
calculate a monthly per-payphone default compensation rate, which will
apply to payphones that are not connected to Flex ANI, a call-tracking
technology.

DATES: Submit comments on or before June 27, 2005. Submit reply
comments on or before July 25, 2005.

ADDRESSES: You may submit comments, identified by WC Docket No. 03-225,
by any of the following methods:
Federal eRulemaking Portal: http://regulations.gov. Follow

the instructions for submitting comments.
Agency Web site: http://www.fcc.gov. Follow the

instructions for

[[Page 24741]]

submitting comments on our electronic Web site: http://hraunfoss.fcc.gov/edocs_public/SilverStream/Pages/edocs.html.
. E-mail: Jon.Stover@fcc.gov. Include WC Docket No. 03-225

in the subject line of the message.
Fax: (202) 418-1567
Mail: Commission's Secretary, Marlene H. Dortch, Office of
the Secretary, Federal Communications Commission, 445 Twelfth Street,
SW., Washington, DC 20554.
Hand Delivery/Courier: Secretary, Federal Communications
Commission, Office of the Secretary, c/o Natek, Inc. 236 Massachusetts
Avenue, NE., Suite 110, Washington, DC 20002.
Instructions: All submissions received must include the agency name
and docket number for this rulemaking. All comments received will be
posted without change to http://hraunfoss.fcc.gov/edocs_public/SilverStream/Pages/edocs.html
, including any personal information

provided. For detailed instructions on submitting comments and
additional information on the rulemaking process, see the ``Public
Participation'' heading of the SUPPLEMENTARY INFORMATION section of
this document.
Docket: For access to the docket to read background documents or
comments received, go to http://hraunfoss.fcc.gov/edocs_public/SilverStream/Pages/edocs.html
and/or Federal Communications Commission,

445 Twelfth Street, SW., Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: Jon Stover, Wireline Competition
Bureau, Pricing Policy Division, (202) 418-0390.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Further Notice of Proposed Rulemaking in WC Docket No. 03-225, adopted
on March 10, 2005 and released on March 14, 2005. The complete text of
this Further Notice of Proposed Rulemaking (FNPRM) is available for
public inspection Monday through Thursday from 8 a.m. to 4:30 p.m. and
Friday from 8 a.m. to 11:30 a.m. in the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, Room CY-
A257, 445 Twelfth Street, SW., Washington, DC 20554. The complete text
is also available on the Commission's Internet Site at http://www.

fcc.gov. Alternative formats are available to persons with disabilities
by contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365. The
complete text of the FNPRM may be purchased from the Commission's
duplicating contractor, Best Copying and Printing, Inc., Room CY-B402,
445 Twelfth Street, SW., Washington, DC 20554, telephone (202) 863-
2893, facsimile (202) 863-2898, or e-mail at http://www.bcpiweb.com.

Synopsis of Further Notice of Proposed Rulemaking

1. When the Commission initially adopted a payphone compensation
rule pursuant to 47 U.S.C. 276(b)(1)(A), many carriers lacked reliable
systems for tracking dial-around calls. In the Commission's First
Payphone Report and Order, it ordered compensation to be paid initially
on a per-phone, rather than a per-call basis. To arrive at the total
per-payphone rate, the Commission calculated that 131 dial-around calls
were placed from the average payphone per month. When this average
volume amount was multiplied by the then current per-call default rate
of $.35, the result yielded a per-phone compensation rate of $45.85 per
month.
2. Since the release of the First Payphone Report and Order,
approximately 95 percent of all payphones have been connected to Flex
ANI, a call-tracking technology that accurately tracks payphone calls
from the payphone instrument to the called party. The remaining five
per cent of payphones, which are generally located in remote and rural
geographic areas are not connected to Flex ANI. With this FNPRM, the
Commission continues to implement the requirements of 47 U.S.C. 276 of
the Communications Act of 1934, as amended, which directs the
Commission to ``promote the widespread deployment of payphone services
to the benefit of the general public.''
3. Although the Commission recently increased the per-call rate to
$.494, it has not updated the average number of dial-around calls per
payphone since 1997. The record in this proceeding indicates that since
1998, there has been a significant decline in per-payphone call
volumes. If dial-around call volumes have followed the same trend as
overall call volumes, the data sought by this FNPRM will probably also
have significantly declined.
4. Finally, once the Commission receives the updated volumetric
data, it will calculate a new monthly per-payphone rate based on the
new data and the existing per-call rate. The new monthly rate will
ensure that all payphone service providers are ``fairly compensated''
for each and every completed intrastate and interstate call using their
payphone.

Initial Paperwork Reduction Act Analysis

5. This FNPRM contains new information collection requirements. The
Commission, as part of its continuing effort to reduce paperwork
burdens, invites the general public and the Office of Management and
Budget (OMB) to take this opportunity to comment on the information
collections contained in this FNPRM, as required by the Paperwork
Reduction Act of 1995, Public Law 104-13. Public and agency comments
are due 60 days after date of publication in the Federal Register.
Comments should address: (a) Whether the proposed collection of
information is necessary for the proper performance of the functions of
the Commission, including whether the information shall have practical
utility; (b) the accuracy of the Commission's burden estimates; (c)
ways to enhance the quality, utility, and clarity of the information
collected; and (d) ways to minimize the burden of the collection of
information on the respondents, including the use of automated
collection techniques or other forms of information technology. In
addition, pursuant to the Small Business Paperwork Relief Act of 2002,
Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment
on how we might ``further reduce the information collection burden for
small business concerns with fewer than 25 employees.''
OMB Control Number: 3060-XXXX.
Title: Request to Update Default Compensation Rate for WC Docket
No. 03-225 Dial-Around Calls from Payphones.
Form No.: N/A.
Type of Review: New collection.
Respondents: Business or other for-profit institutions.
Estimated Number of Respondents: 10.
Estimated Time Per Response: 100 hours.
Frequency of Response: One time.
Estimated Total Annual Burden: 1000 hours.
Estimated Total Annual Costs: 0.
Privacy Act Impact Assessment: N/A.
Needs and Uses: We seek additional data to enable us to determine a
more accurate estimate of the average number of compensable dial-around
calls at a payphone. We urge payphone service providers (PSPs) to
provide us with current data showing the average number of compensable
dial-around calls placed at their payphones. We request that parties
submitting data provide details that will enable us to evaluate the
data and determine how to

[[Page 24742]]

use the data. Data submissions should include, if possible, details
showing how the data were gathered, how samples were selected, the
total number of payphones of each type (e.g., ``dumb'' vs. ``smart,''
regional Bell Operating Companies (RBOC) vs. independent) in the sample
and in the population from which the sample was taken, and the types of
locations represented in the sample. Attempts to gain advantage by
failing to provide us with the necessary context to evaluate their
submissions will result in their data being discounted or rejected. We
invite parties to submit information on the number of payphones that
currently are located in non-equal access areas and in areas where
small telephone companies have received a waiver of the Flex ANI
requirement, and on the average number of compensable dial-around calls
originating from such payphones.
6. In addition to filing comments with the Secretary, a copy of any
comments on the information collection(s) contained herein should be
submitted to Judith Boley Herman, Federal Communications Commission,
Room 1-C804, 445 12th Street SW., Washington, DC 20554, or via the
Internet to Judith B. Herman@fcc.gov, and to Kristy L. Lalonde, OMB
Desk Officer, Room 10234 NEOB, 725 17th Street NW., Washington, DC
20503, or via the Internet to Kristy L. LaLonde@omb.eop.gov.

Initial Regulatory Flexibility Analysis

7. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission has prepared an Initial Regulatory
Flexibility Analysis (IRFA) of the possible significant economic impact
on a substantial number of small entities by the policies and rule
proposed in the FNPRM.
8. With this FNPRM, the Commission continues its implementation of
the statutory objectives of section 276 of ensuring payphone service
providers are fairly compensation and promoting the widespread
deployment of payphones.

Need for, and Objectives of, the Proposed Rules

9. The Commission's goal in this proceeding is to ensure that all
payphone service providers are fairly compensation. Once this
proceeding is completed, all payphone operations including those not
connected to Flex ANI will be receiving fair compensation for all
completed intrastate and interstate calls made from payphones.

Legal Basis

10. The legal basis for any action that may be taken pursuant to
this FNPRM is contained in sections 1-5, 7, 10, 201-05, 207-09, 214,
218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502 and 503 of
the Communications Act of 1934, as amended, 47 U.S.C. 151-55, 157, 160,
201-05, 207-09, 214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403,
405, 502, and 503 and sections 1.1, 1.421 of the Commission's rules, 47
CFR 1.1, 1.421.

Description and Estimate of the Number of Small Entities to Which the
Proposed Rules Will Apply

11. The RFA directs agencies to provide a description of, and,
where feasible, an estimate of the number of small entities that may be
affected by rules adopted herein. The RFA generally defines the term
``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A ``small business concern'' is one that: (1) Is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Administration (SBA). 5 U.S.C. 632.
12. In this section, the Commission further describes and estimates
the number of small entity licensees and regulatees that may also be
indirectly affected by rules adopted pursuant to this FNPRM. The most
reliable source of information regarding the total numbers of certain
common carrier and related providers nationwide, as well as the number
of commercial wireless entities, appears to be the data that the
Commission publishes in its Trends in Telephone Service report. The SBA
has developed small business size standards for wireline and wireless
small businesses within the three commercial census categories of Wired
Telecommunications Carriers, Paging, and Cellular and Other Wireless
Telecommunications. Under these categories, a business is small if it
has 1,500 or fewer employees. Below, using the above size standards and
others, the Commission discusses the total estimated numbers of small
businesses that might be affected by its actions.
13. Wired Telecommunications Carriers. The SBA has developed a
small business size standard for Wired Telecommunications Carriers,
which consists of all such companies having 1,500 or fewer employees.
According to Census Bureau data for 1997, there were 2,225 firms in
this category, total, that operated for the entire year. Of this total,
2,201 firms had employment of 999 or fewer employees, and an additional
24 firms had employment of 1,000 employees or more. Thus, under this
size standard, the majority of firms can be considered small.
14. Local Exchange Carriers. Neither the Commission nor the SBA has
developed a size standard for small businesses specifically applicable
to local exchange services. The closest applicable size standard under
SBA rules is for Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 1,310 carriers reported that they were
incumbent local exchange service providers. Of these 1,310 carriers, an
estimated 1,025 have 1,500 or fewer employees and 285 have more than
1,500 employees. In addition, according to Commission data, 563
companies reported that they were engaged in the provision of either
competitive access provider services or competitive local exchange
carrier services. Of these 563 companies, an estimated 472 have 1,500
or fewer employees and 91 have more than 1,500 employees. In addition,
37 carriers reported that they were ``Other Local Exchange Carriers.''
Of the 37 ``Other Local Exchange Carriers,'' an estimated 36 have 1,500
or fewer employees and one has more than 1,500 employees. Consequently,
the Commission estimates that most providers of local exchange service,
competitive local exchange service, competitive access providers, and
``Other Local Exchange Carriers'' are small entities that may be
affected by the rules and policies adopted herein.
15. Interexchange Carriers. Neither the Commission nor the SBA has
developed a size standard for small businesses specifically applicable
to interexchange services. The closest applicable size standard under
SBA rules is for Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 281 companies reported that they were
interexchange carriers. Of these 281 companies, an estimated 254 have
1,500 or fewer employees and 27 have more than 1,500 employees.
Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by the rules and policies adopted herein.
16. Wired Telecommunications Carriers. The SBA has developed a
small business size standard for Wired Telecommunications Carriers,
which consists of all such companies having 1,500 or fewer employees.
According to

[[Page 24743]]

Census Bureau data for 1997, there were 2,225 firms in this category,
total, that operated for the entire year. Of this total, 2,201 firms
had employment of 999 or fewer employees, and an additional 24 firms
had employment of 1,000 employees or more. Thus, under this size
standard, the majority of firms can be considered small.
17. Incumbent Local Exchange Carriers (LECs). Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to incumbent local exchange
services. The closest applicable size standard under SBA rules is for
Wired Telecommunications Carriers. Under that size standard, such a
business is small if it has 1,500 or fewer employees. According to
Commission data, 1,337 carriers reported that they were engaged in the
provision of local exchange services. Of these 1,337 carriers, an
estimated 1,032 have 1,500 or fewer employees and 305 have more than
1,500 employees. Consequently, the Commission estimates that most
providers of incumbent local exchange service are small businesses that
may be affected by the rules and policies adopted herein.
18. Competitive Local Exchange Carriers (CLECs), Competitive Access
Providers (CAPs), and ``Other Local Exchange Carriers.'' Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to providers of competitive exchange
services or to competitive access providers or to ``Other Local
Exchange Carriers,'' all of which are discrete categories under which
TRS data are collected. The closest applicable size standard under SBA
rules is for Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 609 companies reported that they were
engaged in the provision of either competitive access provider services
or competitive local exchange carrier services. Of these 609 companies,
an estimated 458 have 1,500 or fewer employees and 151 have more than
1,500 employees. In addition, 35 carriers reported that they were
``Other Local Service Providers.'' Of the 35 ``Other Local Service
Providers,'' an estimated 34 have 1,500 or fewer employees and one has
more than 1,500 employees. Consequently, the Commission estimates that
most providers of competitive local exchange service, competitive
access providers, and ``Other Local Exchange Carriers'' are small
entities that may be affected by the rules and policies adopted herein.
19. Interexchange Carriers (IXCs). Neither the Commission nor the
SBA has developed a size standard for small businesses specifically
applicable to interexchange services. The closest applicable size
standard under SBA rules is for Wired Telecommunications Carriers.
Under that size standard, such a business is small if it has 1,500 or
fewer employees. According to Commission data, 261 companies reported
that their primary telecommunications service activity was the
provision of interexchange services. Of these 261 companies, an
estimated 223 have 1,500 or fewer employees and 38 have more than 1,500
employees. Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by the rules and policies adopted herein.
20. Operator Service Providers (OSPs). Neither the Commission nor
the SBA has developed a size standard for small businesses specifically
applicable to operator service providers. The closest applicable size
standard under SBA rules is for Wired Telecommunications Carriers.
Under that size standard, such a business is small if it has 1,500 or
fewer employees. According to Commission data, 23 companies reported
that they were engaged in the provision of operator services. Of these
23 companies, an estimated 22 have 1,500 or fewer employees and one has
more than 1,500 employees. Consequently, the Commission estimates that
the majority of operator service providers are small entities that may
be affected by the rules and policies adopted herein.
21. Payphone Service Providers (PSPs). Neither the Commission nor
the SBA has developed a size standard for small businesses specifically
applicable to payphone service providers. The closest applicable size
standard under SBA rules is for Wired Telecommunications Carriers.
Under that size standard, such a business is small if it has 1,500 or
fewer employees. According to Commission data, 761 companies reported
that they were engaged in the provision of payphone services. Of these
761 companies, an estimated 757 have 1,500 or fewer employees and four
have more than 1,500 employees. Consequently, the Commission estimates
that the majority of payphone service providers are small entities that
may be affected by the rules and policies adopted herein.
22. Prepaid Calling Card Providers. The SBA has developed a size
standard for a small business within the category of Telecommunications
Resellers. Under that SBA size standard, such a business is small if it
has 1,500 or fewer employees. According to Commission data, 37
companies reported that they were engaged in the provision of prepaid
calling cards. Of these 37 companies, an estimated 36 have 1,500 or
fewer employees and one has more than 1,500 employees. Consequently,
the Commission estimates that the majority of prepaid calling card
providers are small entities that may be affected by the rules and
policies adopted herein.
23. Local Resellers. The SBA has developed a small business size
standard for the category of Telecommunications Resellers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 133 carriers have reported
that they are engaged in the provision of local resale services. Of
these, an estimated 127 have 1,500 or fewer employees and six have more
than 1,500 employees. Consequently, the Commission estimates that the
majority of local resellers are small entities that may be affected by
its action.
24. Toll Resellers. The SBA has developed a small business size
standard for the category of Telecommunications Resellers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 625 carriers have reported
that they are engaged in the provision of toll resale services. Of
these, an estimated 590 have 1,500 or fewer employees and 35 have more
than 1,500 employees. Consequently, the Commission estimates that the
majority of toll resellers are small entities that may be affected by
its action.
25. Other Toll Carriers. Neither the Commission nor the SBA has
developed a size standard for small businesses specifically applicable
to ``Other Toll Carriers.'' This category includes toll carriers that
do not fall within the categories of interexchange carriers, operator
service providers, prepaid calling card providers, satellite service
carriers, or toll resellers. The closest applicable size standard under
SBA rules is for Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission's data, 92 companies reported that their
primary telecommunications service activity was the provision of other
toll carriage. Of these 92 companies, an estimated 82 have 1,500 or
fewer employees and ten have more than 1,500 employees.

[[Page 24744]]

Consequently, the Commission estimates that most ``Other Toll
Carriers'' are small entities that may be affected by the rules and
policies adopted herein.
26. Paging. The SBA has developed a small business size standard
for Paging, which consists of all such firms having 1,500 or fewer
employees. According to Census Bureau data for 1997, in this category
there was a total of 1,320 firms that operated for the entire year. Of
this total, 1,303 firms had employment of 999 or fewer employees, and
an additional seventeen firms had employment of 1,000 employees or
more. Thus, under this size standard, the majority of firms can be
considered small.
27. Cellular and Other Wireless Telecommunications. The SBA has
developed a small business size standard for Cellular and Other
Wireless Telecommunication, which consists of all such firms having
1,500 or fewer employees. According to Census Bureau data for 1997, in
this category there was a total of 977 firms that operated for the
entire year. Of this total, 965 firms had employment of 999 or fewer
employees, and an additional twelve firms had employment of 1,000
employees or more. Thus, under this size standard, the majority of
firms can be considered small.
28. Broadband Personal Communications Service. The broadband
Personal Communications Service (PCS) spectrum is divided into six
frequency blocks designated A through F, and the Commission has held
auctions for each block. The Commission defined ``small entity'' for
Blocks C and F as an entity that has average gross revenues of $40
million or less in the three previous calendar years. For Block F, an
additional classification for ``very small business'' was added and is
defined as an entity that, together with its affiliates, has average
gross revenues of not more than $15 million for the preceding three
calendar years. These standards defining ``small entity'' in the
context of broadband PCS auctions have been approved by the SBA. No
small businesses, within the SBA-approved small business size standards
bid successfully for licenses in Blocks A and B. There were 90 winning
bidders that qualified as small entities in the Block C auctions. A
total of 93 small and very small business bidders won approximately 40
percent of the 1,479 licenses for Blocks D, E, and F. On March 23,
1999, the Commission re-auctioned 347 C, D, E, and F Block licenses.
There were 48 small business winning bidders. On January 26, 2001, the
Commission completed the auction of 422 C and F Broadband PCS licenses
in Auction No. 35. Of the 35 winning bidders in this auction, 29
qualified as ``small'' or ``very small'' businesses. Based on this
information, the Commission concludes that the number of small
broadband PCS licenses will include the 90 winning C Block bidders, the
93 qualifying bidders in the D, E, and F Block auctions, the 48 winning
bidders in the 1999 re-auction, and the 29 winning bidders in the 2001
re-auction, for a total of 260 small entity broadband PCS providers, as
defined by the SBA small business size standards and the Commission's
auction rules. The Commission notes that, as a general matter, the
number of winning bidders that qualify as small businesses at the close
of an auction does not necessarily represent the number of small
businesses currently in service. Also, the Commission does not
generally track subsequent business size unless, in the context of
assignments or transfers, unjust enrichment issues are implicated.
29. Narrowband Personal Communications Services. The Commission has
adopted a two-tiered small business size standard in the Narrowband PCS
Second Report and Order, 65 FR 35875, June 6, 2000. A ``small
business'' is an entity that, together with affiliates and controlling
interests, has average gross revenues for the three preceding years of
not more than $40 million. A ``very small business'' is an entity that,
together with affiliates and controlling interests, has average gross
revenues for the three preceding years of not more than $15 million.
The SBA has approved these small business size standards. In the
future, the Commission will auction 459 licenses to serve Metropolitan
Trading Areas (MTAs) and 408 response channel licenses. There is also
one megahertz of narrowband PCS spectrum that has been held in reserve
and that the Commission has not yet decided to release for licensing.
The Commission cannot predict accurately the number of licenses that
will be awarded to small entities in future actions. However, four of
the 16 winning bidders in the two previous narrowband PCS auctions were
small businesses, as that term was defined under the Commission's
Rules. The Commission assumes, for purposes of this analysis, that a
large portion of the remaining narrowband PCS licenses will be awarded
to small entities. The Commission also assumes that at least some small
businesses will acquire narrowband PCS licenses by means of the
Commission's partitioning and disaggregation rules.
30. 220 MHz Radio Service--Phase I Licensees. The 220 MHz service
has both Phase I and Phase II licenses. Phase I licensing was conducted
by lotteries in 1992 and 1993. There are approximately 1,515 such non-
nationwide licensees and four nationwide licensees currently authorized
to operate in the 220 MHz band. The Commission has not developed a
small business size standard for small entities specifically applicable
to such incumbent 220 MHz Phase I licensees. To estimate the number of
such licensees that are small businesses, the Commission applies the
small business size standard under the SBA rules applicable to
``Cellular and Other Wireless Telecommunications'' companies. This
standard provides that such a company is small if it employs no more
than 1,500 persons. According to Census Bureau data for 1997, there
were 977 firms in this category, total, that operated for the entire
year. Of this total, 965 firms had employment of 999 or fewer
employees, and an additional 12 firms had employment of 1,000 employees
or more. If this general ratio continues in the context of Phase I 220
MHz licensees, the Commission estimates that nearly all such licensees
are small businesses under the SBA's small business size standard.
31. 220 MHz Radio Service--Phase II Licensees. The 220 MHz service
has both Phase I and Phase II licenses. The Phase II 220 MHz service is
a new service, and is subject to spectrum auctions. In the 220 MHz
Third Report and Order, 62 FR 15978, April 3, 1997, the Commission
adopted a small business size standard for ``small'' and ``very small''
businesses for purposes of determining their eligibility for special
provisions such as bidding credits and installment payments. This small
business size standard indicates that a ``small business'' is an entity
that, together with its affiliates and controlling principals, has
average gross revenues not exceeding $15 million for the preceding
three years. A ``very small business'' is an entity that, together with
its affiliates and controlling principals, has average gross revenues
that do not exceed $3 million for the preceding three years. The SBA
has approved these small business size standards. Auctions of Phase II
licenses commenced on September 15, 1998, and closed on October 22,
1998. In the first auction, 908 licenses were auctioned in three
different-sized geographic areas: three nationwide licenses, 30
Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA)
Licenses. Of the 908 licenses auctioned, 693 were sold. Thirty-nine
small businesses won

[[Page 24745]]

licenses in the first 220 MHz auction. The second auction included 225
licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies
claiming small business status won 158 licenses.
32. 800 MHz and 900 MHz Specialized Mobile Radio Licenses. The
Commission awards ``small entity'' and ``very small entity'' bidding
credits in auctions for Specialized Mobile Radio (SMR) geographic area
licenses in the 900 MHz bands to firms that had revenues of no more
than $15 million in each of the three previous calendar years, or that
had revenues of no more than $3 million in each of the previous
calendar years. The SBA has approved these size standards. The
Commission awards ``small entity'' and ``very small entity'' bidding
credits in auctions for Specialized Mobile Radio (SMR) geographic area
licenses in the 800 MHz bands to firms that had revenues of no more
than $40 million in each of the three previous calendar years, or that
had revenues of no more than $15 million in each of the previous
calendar years. These bidding credits apply to SMR providers in the 800
MHz and 900 MHz bands that either hold geographic area licenses or have
obtained extended implementation authorizations. The Commission does
not know how many firms provide 800 MHz or 900 MHz geographic area SMR
service pursuant to extended implementation authorizations, nor how
many of these providers have annual revenues of no more than $15
million. One firm has over $15 million in revenues. The Commission
assumes, for purposes here, that all of the remaining existing extended
implementation authorizations are held by small entities, as that term
is defined by the SBA. The Commission has held auctions for geographic
area licenses in the 800 MHz and 900 MHz SMR bands. There were 60
winning bidders that qualified as small or very small entities in the
900 MHz SMR auctions. Of the 1,020 licenses won in the 900 MHz auction,
bidders qualifying as small or very small entities won 263 licenses. In
the 800 MHz auction, 38 of the 524 licenses won were won by small and
very small entities. The Commission notes that, as a general matter,
the number of winning bidders that qualify as small businesses at the
close of an auction does not necessarily represent the number of small
businesses currently in service. Also, the Commission does not
generally track subsequent business size unless, in the context of
assignments or transfers, unjust enrichment issues are implicated.
33. Private and Common Carrier Paging. In the Paging Third Report
and Order, 62 FR 16004, April 3, 1997, the Commission developed a small
business size standard for ``small businesses'' and ``very small
businesses'' for purposes of determining their eligibility for special
provisions such as bidding credits and installment payments. A ``small
business'' is an entity that, together with its affiliates and
controlling principals, has average gross revenues not exceeding $15
million for the preceding three years. Additionally, a ``very small
business'' is an entity that, together with its affiliates and
controlling principals, has average gross revenues that are not more
than $3 million for the preceding three years. The SBA has approved
these size standards. An auction of Metropolitan Economic Area licenses
commenced on February 24, 2000, and closed on March 2, 2000. Of the 985
licenses auctioned, 440 were sold. Fifty-seven companies claiming small
business status won. At present, there are approximately 24,000
Private-Paging site-specific licenses and 74,000 Common Carrier Paging
licenses. According to the most recent Trends in Telephone Service, 471
carriers reported that they were engaged in the provision of either
paging and messaging services or other mobile services. Of those, the
Commission estimates that 450 are small, under the SBA business size
standard specifying that firms are small if they have 1,500 or fewer
employees.
34. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order,
65 FR 3139, January 20, 2000, the Commission adopted a small business
size standard for ``small businesses'' and ``very small businesses''
for purposes of determining their eligibility for special provisions
such as bidding credits and installment payments. A ``small business''
as an entity that, together with its affiliates and controlling
principals, has average gross revenues not exceeding $15 million for
the preceding three years. Additionally, a ``very small business'' is
an entity that, together with its affiliates and controlling
principals, has average gross revenues that are not more than $3
million for the preceding three years. An auction of 52 Major Economic
Area (MEA) licenses commenced on September 6, 2000, and closed on
September 21, 2000. Of the 104 licenses auctioned, 96 licenses were
sold to nine bidders. Five of these bidders were small businesses that
won a total of 26 licenses. A second auction of 700 MHz Guard Band
licenses commenced on February 13, 2001 and closed on February 21,
2001. All eight of the licenses auctioned were sold to three bidders.
One of these bidders was a small business that won a total of two
licenses.
35. Rural Radiotelephone Service. The Commission has not adopted a
size standard for small businesses specific to the Rural Radiotelephone
Service. A significant subset of the Rural Radiotelephone Service is
the Basic Exchange Telephone Radio System (BETRS). The Commission uses
the SBA's small business size standard applicable to ``Cellular and
Other Wireless Telecommunications,'' i.e., an entity employing no more
than 1,500 persons. There are approximately 1,000 licensees in the
Rural Radiotelephone Service, and the Commission estimates that there
are 1,000 or fewer small entity licensees in the Rural Radiotelephone
Service that may be affected by the rules and policies adopted herein.
36. Air-Ground Radiotelephone Service. The Commission has not
adopted a small business size standard specific to the Air-Ground
Radiotelephone Service. The Commission will use SBA's small business
size standard applicable to ``Cellular and Other Wireless
Telecommunications,'' i.e., an entity employing no more than 1,500
persons. There are approximately 100 licensees in the Air-Ground
Radiotelephone Service, and the Commission estimates that almost all of
them qualify as small under the SBA small business size standard.
37. Aviation and Marine Radio Services. Small businesses in the
aviation and marine radio services use a very high frequency (VHF)
marine or aircraft radio and, as appropriate, an emergency position-
indicating radio beacon (and/or radar) or an emergency locator
transmitter. The Commission has not developed a small business size
standard specifically applicable to these small businesses. For
purposes of this analysis, the Commission uses the SBA small business
size standard for the category ``Cellular and Other
Telecommunications,'' which is 1,500 or fewer employees. Most
applicants for recreational licenses are individuals. Approximately
581,000 ship station licensees and 131,000 aircraft station licensees
operate domestically and are not subject to the radio carriage
requirements of any statute or treaty. For purposes of evaluations in
this analysis, the Commission estimates that there are up to
approximately 712,000 licensees that are small businesses (or
individuals) under the SBA standard. In addition, between December 3,
1998 and December 14, 1998, the Commission held an auction of 42 VHF
Public Coast licenses in the 157.1875-157.4500 MHz (ship transmit) and

[[Page 24746]]

161.775-162.0125 MHz (coast transmit) bands. For purposes of the
auction, the Commission defined a ``small'' business as an entity that,
together with controlling interests and affiliates, has average gross
revenues for the preceding three years not to exceed $15 million. In
addition, a ``very small'' business is one that, together with
controlling interests and affiliates, has average gross revenues for
the preceding three years not to exceed $3 million. There are
approximately 10,672 licensees in the Marine Coast Service, and the
Commission estimates that almost all of them qualify as ``small''
businesses under the above special small business size standards.
38. Fixed Microwave Services. Fixed microwave services include
common carrier, private operational-fixed, and broadcast auxiliary
radio services. At present, there are approximately 22,015 common
carrier fixed licensees and 61,670 private operational-fixed licensees
and broadcast auxiliary radio licensees in the microwave services. The
Commission has not created a size standard for a small business
specifically with respect to fixed microwave services. For purposes of
this analysis, the Commission uses the SBA small business size standard
for the category ``Cellular and Other Telecommunications,'' which is
1,500 or fewer employees. The Commission does not have data specifying
the number of these licensees that have more than 1,500 employees, and
thus is unable at this time to estimate with greater precision the
number of fixed microwave service licensees that would qualify as small
business concerns under the SBA's small business size standard.
Consequently, the Commission estimates that there are up to 22,015
common carrier fixed licensees and up to 61,670 private operational-
fixed licensees and broadcast auxiliary radio licensees in the
microwave services that may be small and may be affected by the rules
and policies adopted herein. The Commission noted, however, that the
common carrier microwave fixed licensee category includes some large
entities.
39. Offshore Radiotelephone Service. This service operates on
several UHF television broadcast channels that are not used for
television broadcasting in the coastal areas of states bordering the
Gulf of Mexico. There are presently approximately 55 licensees in this
service. The Commission is unable to estimate at this time the number
of licensees that would qualify as small under the SBA's small business
size standard for ``Cellular and Other Wireless Telecommunications''
services. Under that SBA small business size standard, a business is
small if it has 1,500 or fewer employees.
40. Wireless Communications Services. This service can be used for
fixed, mobile, radiolocation, and digital audio broadcasting satellite
uses. The Commission established small business size standards for the
wireless communications services (WCS) auction. A ``small business'' is
an entity with average gross revenues of $40 million for each of the
three preceding years, and a ``very small business'' is an entity with
average gross revenues of $15 million for each of the three preceding
years. The SBA has approved these small business size standards. The
Commission auctioned geographic area licenses in the WCS service. In
the auction, there were seven winning bidders that qualified as ``very
small business'' entities, and one that qualified as a ``small
business'' entity. The Commission concludes that the number of
geographic area WCS licensees affected by this analysis includes these
eight entities.
41. 39 GHz Service. The Commission created a special small business
size standard for 39 GHz licenses--an entity that has average gross
revenues of $40 million or less in the three previous calendar years.
An additional size standard for ``very small business'' is: An entity
that, together with affiliates, has average gross revenues of not more
than $15 million for the preceding three calendar years. The SBA has
approved these small business size standards. The auction of the 2,173
39 GHz licenses began on April 12, 2000 and closed on May 8, 2000. The
18 bidders who claimed small business status won 849 licenses.
Consequently, the Commission estimates that 18 or fewer 39 GHz
licensees are small entities that may be affected by the rules and
policies adopted herein.
42. Local Multipoint Distribution Service. Local Multipoint
Distribution Service (LMDS) is a fixed broadband point-to-multipoint
microwave service that provides for two-way video telecommunications.
The auction of the 1,030 Local Multipoint Distribution Service (LMDS)
licenses began on February 18, 1998 and closed on March 25, 1998. The
Commission established a small business size standard for LMDS licenses
as an entity that has average gross revenues of less than $40 million
in the three previous calendar years. An additional small business size
standard for ``very small business'' was added as an entity that,
together with its affiliates, has average gross revenues of not more
than $15 million for the preceding three calendar years. The SBA has
approved these small business size standards in the context of LMDS
auctions. There were 93 winning bidders that qualified as small
entities in the LMDS auctions. A total of 93 small and very small
business bidders won approximately 277 A Block licenses and 387 B Block
licenses. On March 27, 1999, the Commission re-auctioned 161 licenses;
there were 40 winning bidders. Based on this information, the
Commission concluded that the number of small LMDS licenses consists of
the 93 winning bidders in the first auction and the 40 winning bidders
in the re-auction, for a total of 133 small entity LMDS providers.
43. 218-219 MHz Service. The first auction of 218-219 MHz spectrum
resulted in 170 entities winning licenses for 594 Metropolitan
Statistical Area licenses. Of the 594 licenses, 557 were won by
entities qualifying as a small business. For that auction, the small
business size standard was an entity that, together with its
affiliates, has no more than a $6 million net worth and, after federal
income taxes (excluding any carry over losses), has no more than $2
million in annual profits each year for the previous two years. In the
218-219 MHz Report and Order and Memorandum Opinion and Order, 64 FR
59656, November 3, 1999, the Commission established a small business
size standard for a ``small business'' as an entity that, together with
its affiliates and persons or entities that hold interests in such an
entity and their affiliates, has average annual gross revenues not to
exceed $15 million for the preceding three years. A ``very small
business'' is defined as an entity that, together with its affiliates
and persons or entities that hold interests in such an entity and its
affiliates, has average annual gross revenues not to exceed $3 million
for the preceding three years. The SBA has approved these size
standards. The Commission cannot estimate, however, the number of
licenses that will be won by entities qualifying as small or very small
businesses under its rules in future auctions of 218-219 MHz spectrum.
44. 24 GHz--Incumbent Licensees. This analysis may affect incumbent
licensees who were relocated to the 24 GHz band from the 18 GHz band,
and applicants who wish to provide services in the 24 GHz band. The
applicable SBA small business size standard is that of ``Cellular and
Other Wireless Telecommunications'' companies. This category provides
that such a company is small if it employs no more than 1,500 persons.
According to Census Bureau data for 1997, there were 977

[[Page 24747]]

firms in this category that operated for the entire year. Of this
total, 965 firms had employment of 999 or fewer employees, and an
additional 12 firms had employment of 1,000 employees or more. Thus,
under this size standard, the great majority of firms can be considered
small. These broader census data notwithstanding, the Commission
believes that there are only two licensees in the 24 GHz band that were
relocated from the 18 GHz band, Teligent and TRW, Inc. It is the
Commission's understanding that Teligent and its related companies have
less than 1,500 employees, though this may change in the future. TRW is
not a small entity. Thus, only one incumbent licensee in the 24 GHz
band is a small business entity.
45. 24 GHz--Future Licensees. With respect to new applicants in the
24 GHz band, the small business size standard for ``small business'' is
an entity that, together with controlling interests and affiliates, has
average annual gross revenues for the three preceding years not in
excess of $15 million. ``Very small business'' in the 24 GHz band is an
entity that, together with controlling interests and affiliates, has
average gross revenues not exceeding $3 million for the preceding three
years. The SBA has approved these small business size standards. These
size standards will apply to the future auction, if held.
46. Satellite Service Carriers. The SBA has developed a size
standard for small businesses within the category of Satellite
Telecommunications. Under that SBA size standard, such a business is
small if it has 1,500 or fewer employees. According to Commission data,
31 carriers reported that they were engaged in the provision of
satellite services. Of these 31 carriers, an estimated 25 have 1,500 or
fewer employees and six, alone or in combination with affiliates, have
more than 1,500 employees. Consequently, the Commission estimates that
there are 31 or fewer satellite service carriers which are small
businesses that may be affected by the rules and policies proposed
herein.
47. Cable and Other Program Distribution. This category includes
cable systems operators, closed circuit television services, direct
broadcast satellite services, multipoint distribution systems,
satellite master antenna systems, and subscription television services.
The SBA has developed small business size standard for this census
category, which includes all such companies generating $12.5 million or
less in revenue annually. According to Census Bureau data for 1997,
there were a total of 1,311 firms in this category, total, that had
operated for the entire year. Of this total, 1,180 firms had annual
receipts of under $10 million and an additional 52 firms had receipts
of $10 million or more but less than $25 million. Consequently, the
Commission estimates that the majority of providers in this service
category are small businesses that may be affected by the rules and
policies adopted herein.
48. Internet Service Providers. The SBA has developed a small
business size standard for Internet Service Providers (ISPs). ISPs
``provide clients access to the Internet and generally provide related
services such as web hosting, web page designing, and hardware or
software consulting related to Internet connectivity.'' Under the SBA
size standard, such a business is small if it has average annual
receipts of $21 million or less. According to Census Bureau data for
1997, there were 2,751 firms in this category that operated for the
entire year. Of these, 2,659 firms had annual receipts of under $10
million, and an additional 67 firms had receipts of between $10 million
and $24, 999,999. Consequently, the Commission estimates that the
majority of these firms are small entities that may be affected by its
action.
49. All Other Information Services. This industry comprises
establishments primarily engaged in providing other information
services (except new syndicates and libraries and archives).'' The
Commission notes that, in this FNPRM, it has described activities such
as email, online gaming, web browsing, video conferencing, instant
messaging, and other, similar IP-enabled services. The SBA has
developed a small business size standard for this category; that size
standard is $6 million or less in average annual receipts. According to
Census Bureau data for 1997, there were 195 firms in this category that
operated for the entire year. Of these, 172 had annual receipts of
under $5 million, and an additional nine firms had receipts of between
$5 million and $9,999,999. Consequently, the Commission estimates that
the majority of these firms are small entities that may be affected by
its action.

Description of Projected Reporting, Recordkeeping and Other Compliance
Requirements for Small Entities

50. This supplemental IRFA seeks current and accurate monthly data
on the average number of compensable dial-around calls per-payphone.
Once the new data is collected, the new rate will not impose any new
reporting, recordkeeping or other compliance requirements for small
entities.

Steps Taken To Minimize Significant Economic Impact on Small Entities,
and Significant Alternatives Considered

51. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives (among others): (1)
The establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.
52. In this FNPRM, the Commission only seeks to collect current and
accurate data on the average number of compensable dial-around calls
per-payphone. Nevertheless, the Commission seeks comments on
alternatives that will minimize any potential burdens caused by the
need to collect current and accurate monthly per-payphone data.

Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules

53. Implementation of the rule change the Commission is considering
in this FNPRM will require updating the monthly per-payphone rate that
will be established once a current and accurate average number of
compensable dial-around calls is determined. The section of the
Commission's rules that will likely be amended is 47 CFR 64.1301.

Comment Filing Procedures

54. Pursuant to sections 1.415 and 1.419 of the Commission's rules,
interested parties may file comments on or before June 27, 2005, and
reply comments on or before July 25, 2005. Comments may be filed using
the Commission's Electronic Comment Filing System (ECFS) or by filing
paper copies. Comments filed through the ECFS can be sent as an
electronic file via the Internet to http://www.fcc.gov/cgb/ecfs/.

Generally, only one copy of an electronic submission must be filed. If
multiple docket or rulemaking numbers appear in the caption of the
proceeding, 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

[[Page 24748]]

number, in this case, WC Docket No. 03-225. Parties may also submit an
electronic comment by Internet e-mail. To get filing instructions for
e-mail comments, commenters should send an e-mail to ecfs@fcc.gov, and
should include the following words in the body of the message, ``get
form.'' A sample form and directions will be sent in reply. Parties who
choose to file by paper must file an original and four copies of each
filing. If more than one docket or rulemaking number appears in the
caption of this proceeding, commenters must submit two additional
copies for each additional docket or rulemaking number.
55. Filings can be sent by hand or messenger delivery, by
commercial overnight courier, or by first-class or overnight U.S.
Postal Service mail (although the Commission continues to experience
delays in receiving U.S. Postal Service mail). Parties are strongly
encouraged to file comments electronically using the Commission's ECFS.
56. The Commission's contractor, Natek, 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.

57. All filings must be addressed to the Commission's Secretary,
Marlene H. Dortch, Office of the Secretary, Federal Communications
Commission, 445 12th Street, SW., Washington, DC 20554. Parties should
also send a copy of their filings to Victoria Goldberg, Pricing Policy
Division, Wireline Competition Bureau, Federal Communications
Commission, Room 5-A266, 445 12th Street, SW., Washington, DC 20554, or
by e-mail to victoria.goldberg@fcc.gov. Parties shall also serve one
copy with the Commission's copy contractor, Best Copy and Printing,
Inc. (BCPI), Portals II, 445 12th Street, SW., Room CY-B402,
Washington, DC 20554, (202) 488-5300, or via e-mail to fcc@bcpiweb.com.
58. Documents in WC Docket No. 03-225 are available for public
inspection and copying during business hours at the FCC Reference
Information Center, Portals II, 445 12th St. SW., Room CY-A257,
Washington, DC 20554. The documents may also be purchased from BCPI,
telephone (202) 488-5300, facsimile (202) 488-5563, TTY (202) 488-5562,
e-mail fcc@bcpiweb.com.

Ordering Clauses

59. Accordingly, it is ordered that, pursuant to the authority
contained in sections 1-5, 7, 10, 201-05, 207-09, 214, 218-20, 225-27,
251-54, 256, 271, 303, 332, 403, 405, 502 and 503 of the Communications
Act of 1934, as amended, 47 U.S.C. 151-155, 157, 160, 201-05, 207-09,
214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502, and 503
and sections 1.1, 1.421 of the Commission's rules, 47 CFR 1.1, 1.421,
notice is hereby given of the rulemaking and comment is sought on those
issues.
60. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Further Notice of Proposed Rulemaking, including the
Supplemental Initial Regulatory Flexibility Analysis, to the Chief
Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 64

Communications common carriers, Telecommunications, Telephone.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Rules Changes

For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR part 64 as follows:

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

1. The authority citation for part 64 continues to read as follows:

Authority: 47 U.S.C. 154, 254(k); secs. 403(b)(2)(B), (c), Pub.
L. 104-104, 110 Stat. 56. Interpret or apply 47 U.S.C. 201, 218,
222, 225, 226, 228, and 254(k) unless otherwise noted.

2. Amend Sec. 64.1301 by revising paragraph (e) to read as
follows:

Sec. 64.1301 Per-Payphone compensation.

* * * * *
(e) Post-intermediate access code and subscriber 800 calls. In the
absence of a negotiated agreement to pay a different amount, each
entity listed in Appendix C of the Fifth Order on Reconsideration and
Order on Remand in CC Docket No. 96-128, FCC 02-292, must pay default
compensation to payphone service providers for access code calls and
payphone subscriber 800 calls for the period beginning April 21, 1999,
and ending -------- , in the amount listed in Appendix C for any
payphone for any month during which per-call compensation for that
payphone for that month is not paid by the listed entity. A complete
copy of Appendix C is available at http://www.fcc.gov. Effective ------

-- , the default compensation to be paid by each entity shall be the
amount listed in Appendix C multiplied by ----.

[FR Doc. 05-9097 Filed 5-10-05; 8:45 am]

BILLING CODE 6712-01-P