[Federal Register Volume 73, Number 128 (Wednesday, July 2, 2008)]
[Proposed Rules]
[Pages 37911-37922]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-14875]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 1 and 43
[WC Docket No. 07-38; FCC 08-89]
Development of Nationwide Broadband Data to Evaluate Reasonable
and Timely Deployment of Advanced Services to All Americans,
Improvement of Wireless Broadband Subscribership Data, and Development
of Data on Interconnected Voice Over Internet Protocol (VoIP)
Subscribership
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In the Further Notice of Proposed Rulemaking (FNPRM), the
Federal Communications Commission (Commission) seeks comment on
modifications to the FCC Form 477 data collection to collect additional
data on broadband service subscriptions. These changes will greatly
improve the ability of the Commission to understand the extent of
broadband deployment, and
[[Page 37912]]
will enable the Commission to continue to develop and maintain
appropriate broadband policies, in particular to carry out its
obligation under section 706 of the Telecommunications Act of 1996 to
``determine whether advanced telecommunications capability is being
deployed to all Americans in a reasonable and timely fashion.''
DATES: Comments on Broadband Availability Mapping are due on or before
July 17, 2008. Reply comments on Broadband Availability Mapping are due
on or before August 1, 2008. Comments on all other issues are due on or
before August 1, 2008. Reply comments on all other issues are due on or
before September 2, 2008.
ADDRESSES: You may submit comments, identified by WC Docket No. 07-38,
by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
Mail: Parties choosing to file by paper must file an
original and four copies of each filing in WC Docket No. 07-38. Filings
can be sent by hand or messenger delivery, by commercial overnight
courier, or by first-class or overnight U.S. Postal Service mail
(although we continue to experience delays in receiving U.S. Postal
Service mail). 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. The
Commission's mail 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.
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by e-mail: [email protected] or phone: 202-418-
0530 or TTY: 202-418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: Alan Feldman, Wireline Competition
Bureau, Industry Analysis and Technology Division, (202) 418-0940.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Further Notice of Proposed Rulemaking in WC Docket No. 07-38, adopted
on March 19, 2008, and released on June 12, 2008. The complete text of
this Further Notice of Proposed Rulemaking 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 12th
Street, SW., Washington, DC 20554. The complete text is available also
on the Commission's Internet site at www.fcc.gov. Alternative formats
are available for persons with disabilities by contacting the Consumer
and Governmental Affairs Bureau, at (202) 418-0531, TTY (202) 418-7365,
or at [email protected]. The complete text of the decision may be
purchased from the Commission's duplicating contractor, Best Copying
and Printing, Inc., Room CY-B402, 445 12th Street, SW., Washington, DC
20554, telephone (202) 488-5300, facsimile (202) 488-5563, TTY (202)
488-5562, or e-mail at [email protected].
Synopsis of Further Notice of Proposed Rulemaking
1. In this Further Notice of Proposed Rulemaking (Further Notice),
the Commission seeks comment on modifications to the FCC Form 477 data
collection to collect additional data on broadband service
subscriptions. These proposed changes will enable the Commission to
continue to develop and maintain appropriate broadband policies, in
particular to carry out its obligation under section 706 of the
Telecommunications Act of 1996 to ``determine whether advanced
telecommunications capability is being deployed to all Americans in a
reasonable and timely fashion.''
2. In particular, the Commission seeks comment on developing a
nationwide broadband availability mapping program. The Commission seeks
comment on ways in which it might effectively capture information about
actual, delivered speeds of broadband Internet access services, and
about prices of broadband services. In addition, the Commission seeks
comment on whether to require Form 477 filers to report the number of
voice telephone service connections at the ZIP Code or Census Tract
level. Finally, the Commission seeks comment on methodologies for
consumer broadband surveys, and on methods for preserving
confidentiality when sharing the information collected on Form 477.
Reporting Number of Lines and Channels
3. Currently, local exchange carriers that file Form 477 are
required to report the total number of voice-grade equivalent lines and
wireless channels provided to end users. This information is provided
on a state-by-state basis. In this Further Notice, the Commission seeks
comment on whether to require Form 477 filers to report the number of
voice telephone service connections, and the percentage of these that
are residential, at the 5-digit ZIP Code or Census Tract level. This
increased granularity of data would enable the Commission to better
assess adoption of particular technologies and competition using
particular technologies in localized areas. The Commission seeks
comment on the benefits and burdens associated with this additional
reporting requirement.
Broadband Availability Mapping
4. In the Data Gathering Notice, the Commission sought comment on
methods to better use the data collected by Form 477. The Commission
acknowledged the success of the ConnectKentucky initiative and its
interactive mapping program. The Commission notes that the
ConnectKentucky program, along with other efforts at the state level,
has facilitated identification of areas without broadband service, and
that this identification has resulted in public and private resources
being focused to provide service to unserved areas. In order to provide
an information resource that will facilitate similar focus nationwide,
the Commission seeks comment on the adoption of a national broadband
mapping program with the objective of creating a highly detailed map of
broadband availability nationwide. The Commission seeks comment on ways
such a program can provide useful information to other broadband
initiatives undertaken by federal and state agencies and public-private
partnerships, such as ConnectKentucky. The Commission seeks comment on
whether and to what extent it might work with the
[[Page 37913]]
Department of Agriculture's Rural Utilities Service in developing and
using this mapping program, so as to combine the expertise of the
Commission and its staff with that of the RUS in supporting rural
infrastructure deployment.
5. The Commission tentatively concludes that the Commission should
collect information that providers use to respond to prospective
customers to determine on an address-by-address basis whether service
is available. The Commission seeks comment on this conclusion, and on
what standardized formats could be used to collect the information. The
Commission seeks comment on whether and how a nationwide broadband
mapping program can incorporate the data collected on Form 477,
including information on broadband service subscriptions by Census
Tract and by speed tier. The Commission also seeks comment on whether
there are other sources of data it should collect to improve the output
of the broadband service availability mapping program. The Commission
seeks comment on how to maintain the confidentiality of broadband
service information while still providing a rich resource for use by
other federal agencies, states, localities, and public-private
partnerships in focusing resources on expanding broadband availability
in a manner, similar to the focusing of resources enabled by the
ConnectKentucky project. The Commission will apply an expedited comment
cycle on this issue, and it intends to issue a responsive Order within
4 months.
Delivered Speed Information Gathering
6. In the Data Gathering Notice the Commission sought comment on
whether to require reporting of actual broadband connection speeds
experienced by customers rather than the theoretical maximum that a
given network can support or the particular service configuration
allows. The record indicates that factors beyond the control of service
providers may compromise the ability of service providers to report
actual speeds experienced by consumers. Also, comments in the record
point to the existence of other methods of collecting this information.
In this Further Notice, the Commission seeks comment on how it might
require service providers to report this information, and any
alternative means, in addition to or other than requiring such service
provider reporting, for effectively capturing meaningful information
about actual speeds of Internet access services experienced by
consumers.
Broadband Price Information
7. In the Data Gathering Notice, the Commission sought comment on
whether and how it could collect price information for broadband
services. Among other questions, the Commission asked how to compare
price information in introductory offers and bundled services. In the
record in this proceeding, commenters note that such price information
is helpful in understanding broadband uptake, particularly when viewed
across regions and in comparison to demographic information. Comments
from state entities also emphasized the value of gathering price
information, particularly for low-cost broadband services, to assist
the state entities with ensuring availability of broadband service and
monitoring competition. Commenters note, however, that price
information is complex due to promotions, bundling discounts, contract
terms, multi-part tariffs, and other contextual information, and that
price fluctuations can be frequent and have the potential to render
data gathering meaningless or even misleading. Some commenters suggest
collecting pricing information on a price-per-bit basis to simplify
reporting and comparison. Others question the need for or utility of
collecting this information on Form 477 at all and note that other
entities are already gathering pricing information on broadband
services. One commenter suggests that any meaningful standards or
comparisons need to somehow account for non-speed differences in
service features. Another states that the lack of low-cost, standalone
broadband service itself may be indicative of a lack of competition.
8. The Commission seeks to supplement and enrich the record on
broadband price information. The Commission seeks comment on requiring
providers to report, for each state or each Census Tract in which they
offer service, the monthly price the provider charges for standalone
broadband service in each of the speed tiers used for Form 477
reporting, not including any temporary promotional price discounts or
any discounts for bundled services. If a provider offers multiple
broadband services with different service characteristics within a
speed tier (e.g., services that include either a static or a dynamic IP
address), or charges different prices for a service for customers in
different portions of a state or Census Tract, the Commission seeks
comment on whether it should require the provider to report the lowest
and the highest prices available to consumers within the state or
Census Tract, in order to identify the range of prices that a consumer
may have to pay. In the alternative, the Commission seeks comment on
whether it should require providers to report the lowest price for
standalone service available to consumers within the state or Census
Tract within each speed tier. If a provider has only national pricing
for a service, the Commission seeks comment on permitting the provider
to report the monthly national price for such a service, in lieu of
individual state reports. The Commission also seeks comment on whether
there are any methods to derive a standalone price for broadband
service when only bundled services are offered by a provider.
Specifically, if a provider does not offer standalone service, but does
offer bundled service, the Commission seeks comment on whether it
should require the provider to report the total monthly price of the
least expensive bundle of services that includes the broadband service.
The Commission seeks comment on whether it should also require
providers to report the Average Revenue Per User, or ARPU, for their
services. The Commission seeks comment on any additional metrics or
standards that it may adopt to collect meaningful comparative broadband
price information in the presence of widespread service bundling,
promotional pricing, flux and variability in broadband service prices,
and the variety of optional features associated with services. And
finally, the Commission seeks comment on whether and in what form the
Commission should use the reported service price information.
Preserving Confidentiality
9. In the Further Notice above, the Commission seeks comment on a
national broadband availability mapping program, and on how it can
provide information gathered by that program to other broadband
initiatives undertaken by federal and state agencies and by public-
private partnerships. Comments in the record indicate concern for the
confidentiality of reported data. The Commission seeks comment on ways
in which it can preserve confidentiality when sharing the information
collected on Form 477, the voluntary registry, and other sources with
agencies such as the Department of Agriculture's Rural Utilities
Service and with public-private partnerships such as ConnectKentucky
and similar ventures, for example by sharing the data in a less
granular or aggregated form than the level at which it is collected.
[[Page 37914]]
Broadband Customer Surveys
10. The Commission seeks comment on whether it should conduct and
publish periodic surveys of broadband customers to obtain information
about the price, technology, and speed of their connections and to
obtain information about the applications and services that they use
over the connections. The Commission asks commenters to provide
information on the appropriate methodology for conducting such surveys.
Ex Parte Presentations
11. This proceeding shall be treated as a ``permit-but-disclose''
proceeding in accordance with the Commission's ex parte rules. Persons
making oral ex parte presentations are reminded that memoranda
summarizing the presentations must contain summaries of the substance
of the presentations and not merely a listing of the subjects
discussed. More than a one- or two-sentence description of the views
and arguments presented is generally required. Other rules pertaining
to oral and written presentations are set forth in Section 1.1206(b) of
the Commission's rules as well.
Comment Filing Procedures
12. Pursuant to sections 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments and reply
comments on or before the dates indicated on the first page of this
document. All filings related to this Notice of Proposed Rulemaking
should refer to WC Docket No. 07-38. Comments may be filed using: (1)
The Commission's Electronic Comment Filing System (ECFS), (2) the
Federal Government's rulemaking Portal, or (3) by filing paper copies.
See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR
24,121 (1998).
Electronic Filers: Comments may be filed electronically
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs
or the Federal eRulemaking Portal: http://www.regulations.gov. Filers
should follow the instructions provided on the Web site for submitting
comments.
[cir] For ECFS filers, if multiple dockets or rulemaking numbers
appear in the caption of this proceeding, filers must transmit one
electronic copy of the comments for each docket or rulemaking number
referenced in the caption. In completing the transmittal screen, filers
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,
filers should send an e-mail to [email protected], and include the following
words in the body of the message, ``get form.'' A sample form and
directions will be sent in response.
Paper Filers: Parties who choose to file by paper must
file an original and four copies of each filing. If more than one
docket or rulemaking number appears in the caption of this proceeding,
filers must submit two additional copies for each additional docket or
rulemaking number.
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). All filings must be addressed to
the Commission's Secretary, Office of the Secretary, Federal
Communications Commission.
[cir] The Commission's contractor will receive hand-delivered or
messenger-delivered paper filings for the Commission's Secretary at 236
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be
held together with rubber bands or fasteners. Any envelopes must be
disposed of before entering the building.
[cir] 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.
[cir] U.S. Postal Service first-class, Express, and Priority mail
must be addressed to 445 12th Street, SW., Washington, DC 20554.
13. Comments and reply comments and any other filed documents in
this matter may be obtained from Best Copy and Printing, Inc., in
person at 445 12th Street, SW., Room CY-B402, Washington, DC 20554, via
telephone at (202) 488-5300, via facsimile at (202) 488-5563, or via e-
mail at [email protected]. The pleadings will also be available for
public inspection and copying during regular business hours in the FCC
Reference Information Center, Room CY-A257, 445 12th Street, SW.,
Washington, DC 20554, and through the Commission's Electronic Comment
Filing System (ECFS) accessible on the Commission's Web site, http://www.fcc.gov/cgb/ecfs.
14. To request materials in accessible formats for people with
disabilities (braille, large print, electronic files, audio format),
send an e-mail to [email protected] or call the Consumer & Governmental
Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (TTY).
15. Comments and reply comments must include a short and concise
summary of the substantive arguments raised in the pleading. Comments
and reply comments also must comply with section 1.49 and all other
applicable sections of the Commission's rules. All parties are
encouraged to utilize a table of contents, and to include the name of
the filing party and the date of the filing on each page of their
submission. The Commission also strongly encourages that parties track
the organization set forth in this Further Notice in order to
facilitate its internal review process.
16. Commenters who file information that they believe should be
withheld from public inspection may request confidential treatment
pursuant to Section 0.459 of the Commission's rules. Commenters should
file both their original comments for which they request
confidentiality and redacted comments, along with their request for
confidential treatment. Commenters should not file proprietary
information electronically. Even if the Commission grants confidential
treatment, information that does not fall within a specific exemption
pursuant to the Freedom of Information Act (FOIA) must be publicly
disclosed pursuant to an appropriate request. See 47 CFR 0.461; 5
U.S.C. 552. The Commission may grant requests for confidential
treatment either conditionally or unconditionally. As such, the
Commission has the discretion to release information on public interest
grounds that does fall within the scope of a FOIA exemption.
Paperwork Reduction Act of 1995 Analysis
17. The Further Notice of Proposed Rulemaking contains proposed new
and modified 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 to comment on
the information collection requirements contained in this document, as
required by the Paperwork Reduction Act of 1995, Public Law 104-13. A
copy of any Paperwork Reduction Act (PRA) comments on the information
collection(s) contained herein should be submitted to the Federal
Communications Commission, Room 1-C804, 445 12th Street, SW.,
Washington, DC 20554, or via the Internet to [email protected], and to
Nicholas Fraser, Office of Management and Budget (OMB), via e-mail to
[[Page 37915]]
Nicholas--A.--Fraser@ omb.eop.gov or via fax at 202-395-5167.
18. In addition, pursuant to the Small Business Paperwork Relief
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the
Commission seeks specific comment on how it might ``further reduce the
information collection burden for small business concerns with fewer
than 25 employees.''
Legal Basis
19. The legal basis for any action that may be taken pursuant to
the FNPRM is contained in sections 1 through 5, 10, 11, 201 through
205, 215, 218 through 220, 251 through 271, 303(r), 332, 403, 502, and
503 of the Communications Act of 1934, as amended, 47 U.S.C. 151
through 155, 160, 161, 201 through 205, 215, 218 through 220, 251
through 271, 303(r), 332, 403, 502, and 503, and section 706 of the
Telecommunications Act of 1996, 47 U.S.C. 157 nt.
Initial Regulatory Flexibility Analysis
20. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission has prepared the present Initial
Regulatory Flexibility Analysis (IRFA) of the possible significant
economic impact on small entities that might result from today's
Further Notice. Written public comments are requested on this IRFA.
Comments must be identified as responses to the IRFA and must be filed
by the deadlines for comments on the Further Notice provided above. The
Commission will send a copy of the Further Notice, including this IRFA,
to the Chief Counsel for Advocacy of the Small Business Administration.
In addition, the Further Notice and IRFA (or summaries thereof) will be
published in the Federal Register.
Need for, and Objectives of, the Proposed Rules
21. In the Further Notice, In the Further Notice, the Commission
considers how to best implement certain reporting requirements and
whether there are additional reporting requirements it should adopt to
improve the ability of the Commission to understand the extent of
deployment of broadband and related services. Specifically, the
Commission seeks comment on whether to require local exchanges carriers
and interconnected VoIP service providers to report the number of voice
telephone service connections, and the percentage of these that are
residential, at the 5-digit ZIP Code or Census Tract level. The
Commission seeks comment on whether to create a broadband mapping
program, and on information that can be collected and included in the
program. The Commission also seeks comment on whether it should require
reporting of information on price of broadband services, and
information on actual, delivered broadband speeds, and the Commission
seeks comment on standards and methodologies appropriate for the
collection of this data. Finally, the Commission seeks general comments
on ways to maintain the privacy of the currently reported data as well
as the new data collections proposed in the Further Notice, and on
appropriate methodologies for the creation of broadband consumer
surveys to acquire additional information. For each of these issues,
the Commission also seeks comment on the burdens, including those
placed on small carriers, associated with corresponding Commission
rules related to each issue and whether there are alternative rules
that might lessen any burden.
Description and Estimate of the Number of Small Entities to Which the
Proposed Rules May Apply
22. The RFA directs agencies to provide a description of, and,
where feasible, an estimate of, the number of small entities that may
be affected by the 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 which: (1) Is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Administration (SBA).
Wireline Carriers and Service Providers
23. Incumbent Local Exchange Carriers (ILECs). 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, 1,307 carriers reported that they were engaged in the
provision of local exchange services. Of these 1,307 carriers, an
estimated 1,019 have 1,500 or fewer employees and 288 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 its action.
24. Competitive Local Exchange Carriers (CLECs), Competitive Access
Providers (CAPs), ``Shared-Tenant Service Providers,'' and ``Other
Local Service Providers.'' Neither the Commission nor the SBA has
developed a small business size standard specifically for these service
providers. The appropriate size standard under SBA rules is for the
category Wired Telecommunications Carriers. Under that size standard,
such a business is small if it has 1,500 or fewer employees. According
to Commission data, 859 carriers reported that they were engaged in the
provision of either competitive local exchange carrier or competitive
access provider services. Of these 859 carriers, an estimated 741 have
1,500 or fewer employees and 118 have more than 1,500 employees. In
addition, 16 carriers have reported that they are ``Shared-Tenant
Service Providers,'' and all 16 are estimated to have 1,500 or fewer
employees. In addition, 44 carriers have reported that they are ``Other
Local Service Providers.'' Of the 44, an estimated 43 have 1,500 or
fewer employees and one has more than 1,500 employees. Consequently,
the Commission estimates that most providers of competitive local
exchange service, competitive access providers, ``Shared-Tenant Service
Providers,'' and ``Other Local Service Providers'' are small entities
that may be affected by its action.
25. The Commission has included small incumbent local exchange
carriers (LECs) in this present RFA analysis. As noted above, a ``small
business'' under the RFA is one that, inter alia, meets the pertinent
small business size standard (e.g., a telephone communications business
having 1,500 or fewer employees), and ``is not dominant in its field of
operation.'' The SBA's Office of Advocacy contends that, for RFA
purposes, small incumbent LECs are not dominant in their field of
operation because any such dominance is not ``national'' in scope. The
Commission has therefore included small incumbent LECs in this RFA
analysis, although it emphasizes that this RFA action has no effect on
Commission analyses and determinations in other, non-RFA contexts.
26. Local Resellers. The SBA has developed a small business size
standard for the category of Telecommunications Resellers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 184 carriers have reported
that they are
[[Page 37916]]
engaged in the provision of local resale services. Of these, an
estimated 181 have 1,500 or fewer employees and three have more than
1,500 employees. Consequently, the Commission estimates that the
majority of local resellers are small entities that may be affected by
its action.
27. Toll Resellers. The SBA has developed a small business size
standard for the category of Telecommunications Resellers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 881 carriers have reported
that they are engaged in the provision of toll resale services. Of
these, an estimated 853 have 1,500 or fewer employees and 28 have more
than 1,500 employees. Consequently, the Commission estimates that the
majority of toll resellers are small entities that may be affected by
its action.
28. Payphone Service Providers (PSPs). Neither the Commission nor
the SBA has developed a small business size standard specifically for
payphone services providers. The appropriate size standard under SBA
rules is for the category Wired Telecommunications Carriers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 657 carriers have reported
that they are engaged in the provision of payphone services. Of these,
an estimated 653 have 1,500 or fewer employees and four have more than
1,500 employees. Consequently, the Commission estimates that the
majority of payphone service providers are small entities that may be
affected by its action.
29. 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, 330 companies reported
that their primary telecommunications service activity was the
provision of interexchange services. Of these 330 companies, an
estimated 309 have 1,500 or fewer employees and 21 have more than 1,500
employees. Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by its action.
30. Operator Service Providers (OSPs). Neither the Commission nor
the SBA has developed a small business size standard specifically for
operator service providers. The appropriate size standard under SBA
rules is for the category Wired Telecommunications Carriers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. According to Commission data, 23 carriers have reported that
they are engaged in the provision of operator services. Of these, an
estimated 22 have 1,500 or fewer employees and one has more than 1,500
employees. Consequently, the Commission estimates that the majority of
OSPs are small entities that may be affected by its action.
31. Prepaid Calling Card Providers. Neither the Commission nor the
SBA has developed a small business size standard specifically for
prepaid calling card providers. The appropriate size standard under SBA
rules is for the category Telecommunications Resellers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 104 carriers have reported that they are
engaged in the provision of prepaid calling cards. Of these, an
estimated 102 have 1,500 or fewer employees and two have 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 its action.
32. 800 and 800-Like Service Subscribers. Neither the Commission
nor the SBA has developed a small business size standard specifically
for 800 and 800-like service (``toll free'') subscribers. The
appropriate size standard under SBA rules is for the category
Telecommunications Resellers. Under that size standard, such a business
is small if it has 1,500 or fewer employees. The most reliable source
of information regarding the number of these service subscribers
appears to be data the Commission collects on the 800, 888, 877, and
866 numbers in use. According to the Commission's data, at the
beginning of July 2006, the number of 800 numbers assigned was
7,647,941; the number of 888 numbers assigned was 5,318,667; the number
of 877 numbers assigned was 4,431,162; and the number of 866 numbers
assigned was 6,008,976. The Commission does not have data specifying
the number of these subscribers that are not independently owned and
operated or have more than 1,500 employees, and thus are unable at this
time to estimate with greater precision the number of toll free
subscribers that would qualify as small businesses under the SBA size
standard. Consequently, the Commission estimates that there are
7,647,941 or fewer small entity 800 subscribers; 5,318,667 or fewer
small entity 888 subscribers; 4,431,162 or fewer small entity 877
subscribers; and 5,318,667 or fewer small entity 866 subscribers.
Wireless Carriers and Service Providers
33. Below, for those services subject to auctions, the Commission
notes that, as a general matter, the number of winning bidders that
qualify as small businesses at the close of an auction does not
necessarily represent the number of small businesses currently in
service. Also, the Commission does not generally track subsequent
business size unless, in the context of assignments or transfers,
unjust enrichment issues are implicated.
34. Wireless Telecommunications Carriers (except Satellite). Since
2007, the SBA has recognized wireless firms within this new, broad,
economic census category. Prior to that time, the SBA had developed a
small business size standard for wireless firms within the now-
superseded census categories of ``Paging'' and ``Cellular and Other
Wireless Telecommunications.'' Under the present and prior categories,
the SBA has deemed a wireless business to be small if it has 1,500 or
fewer employees. Because Census Bureau data are not yet available for
the new category, the Commission will estimate small business
prevalence using the prior categories and associated data. For the
first category of Paging, data for 2002 show that there were 807 firms
that operated for the entire year. Of this total, 804 firms had
employment of 999 or fewer employees, and three firms had employment of
1,000 employees or more. For the second category of Cellular and Other
Wireless Telecommunications, data for 2002 show that there were 1,397
firms that operated for the entire year. Of this total, 1,378 firms had
employment of 999 or fewer employees, and 19 firms had employment of
1,000 employees or more. Thus, using the prior categories and the
available data, the Commission estimates that the majority of wireless
firms can be considered small. According to Commission data, 432
carriers reported that they were engaged in the provision of cellular
service, Personal Communications Service (PCS), or Specialized Mobile
Radio (SMR) Telephony services, which are placed together in the data.
The Commission estimates that 221 of these are small, under the SBA
small business size standard. Thus, under this category and size
standard, about half of firms can be considered small.
[[Page 37917]]
35. Common Carrier Paging. The SBA has developed a small business
size standard for Paging, under which a business is small if it has
1,500 or fewer employees. According to Commission data, 365 carriers
have reported that they are engaged in Paging or Messaging Service. Of
these, an estimated 360 have 1,500 or fewer employees, and 5 have more
than 1,500 employees. Consequently, the Commission estimates that the
majority of paging providers are small entities that may be affected by
its action. In addition, in the Paging Third Report and Order, 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 small business 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.
36. 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, held in April 1997, there were seven winning bidders that
qualified as ``very small business'' entities, and one that qualified
as a ``small business'' entity.
37. Wireless Telephony. Wireless telephony includes cellular,
personal communications services (PCS), and specialized mobile radio
(SMR) telephony carriers. As noted earlier, the SBA has developed a
small business size standard for ``Cellular and Other Wireless
Telecommunications'' services. Under that SBA small business size
standard, a business is small if it has 1,500 or fewer employees.
According to Commission data, 432 carriers reported that they were
engaged in the provision of wireless telephony. The Commission has
estimated that 221 of these are small under the SBA small business size
standard.
38. Broadband Personal Communications Service. The broadband
Personal Communications Service (PCS) spectrum is divided into six
frequency blocks designated A through F, and the Commission has held
auctions for each block. The Commission defined ``small entity'' for
Blocks C and F as an entity that has average gross revenues of $40
million or less in the three previous calendar years. For Block F, an
additional classification for ``very small business'' was added and is
defined as an entity that, together with its affiliates, has average
gross revenues of not more than $15 million for the preceding three
calendar years.'' These standards defining ``small entity'' in the
context of broadband PCS auctions have been approved by the SBA. No
small businesses, within the SBA-approved small business size standards
bid successfully for licenses in Blocks A and B. There were 90 winning
bidders that qualified as small entities in the Block C auctions. A
total of 93 small and very small business bidders won approximately 40
percent of the 1,479 licenses for Blocks D, E, and F. On March 23,
1999, the Commission re-auctioned 347 C, D, E, and F Block licenses.
There were 48 small business winning bidders. On January 26, 2001, the
Commission completed the auction of 422 C and F Broadband PCS licenses
in Auction No. 35. Of the 35 winning bidders in this auction, 29
qualified as ``small'' or ``very small'' businesses. Subsequent events,
concerning Auction 35, including judicial and agency determinations,
resulted in a total of 163 C and F Block licenses being available for
grant.
39. Narrowband Personal Communications Services. To date, two
auctions of narrowband personal communications services (PCS) licenses
have been conducted. For purposes of the two auctions that have already
been held, ``small businesses'' were entities with average gross
revenues for the prior three calendar years of $40 million or less.
Through these auctions, the Commission has awarded a total of 41
licenses, out of which 11 were obtained by small businesses. To ensure
meaningful participation of small business entities in future auctions,
the Commission has adopted a two-tiered small business size standard in
the Narrowband PCS Second Report and Order. 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.
40. 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. Under
this category, the SBA deems a wireless business to be small if it has
1,500 or fewer employees. The Commission estimates that nearly all such
licensees are small businesses under the SBA's small business size
standard.
41. 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, the Commission adopted a
[[Page 37918]]
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 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.
42. 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 800 MHz and 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, respectively. 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.
43. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order,
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'' 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. 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.
44. 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.
45. 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.
46. 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 its 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
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
dollars. 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 dollars. 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.
47. 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
[[Page 37919]]
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
are 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 notes, however, that the
common carrier microwave fixed licensee category includes some large
entities.
48. 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.
49. 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 its action.
50. Wireless Cable Systems. Wireless cable systems use 2 GHz band
frequencies of the Broadband Radio Service (``BRS''), formerly
Multipoint Distribution Service (``MDS''), and the Educational
Broadband Service (``EBS''), formerly Instructional Television Fixed
Service (``ITFS''), to transmit video programming and provide broadband
services to residential subscribers. These services were originally
designed for the delivery of multichannel video programming, similar to
that of traditional cable systems, but over the past several years
licensees have focused their operations instead on providing two-way
high-speed Internet access services. The Commission estimates that the
number of wireless cable subscribers is approximately 100,000, as of
March 2005. Local Multipoint Distribution Service (``LMDS'') is a fixed
broadband point-to-multipoint microwave service that provides for two-
way video telecommunications. As described below, the SBA small
business size standard for the broad census category of Cable and Other
Program Distribution, which consists of such entities generating $13.5
million or less in annual receipts, appears applicable to MDS, ITFS and
LMDS. Other standards also apply, as described.
51. The Commission has defined small MDS (now BRS) and LMDS
entities in the context of Commission license auctions. In the 1996 MDS
auction, the Commission defined a small business as an entity that had
annual average gross revenues of less than $40 million in the previous
three calendar years. This definition of a small entity in the context
of MDS auctions has been approved by the SBA. In the MDS auction, 67
bidders won 493 licenses. Of the 67 auction winners, 61 claimed status
as a small business. At this time, the Commission estimates that of the
61 small business MDS auction winners, 48 remain small business
licensees. In addition to the 48 small businesses that hold BTA
authorizations, there are approximately 392 incumbent MDS licensees
that have gross revenues that are not more than $40 million and are
thus considered small entities. MDS licensees and wireless cable
operators that did not receive their licenses as a result of the MDS
auction fall under the SBA small business size standard for Cable and
Other Program Distribution. Information available to the Commission
indicates that there are approximately 850 of these licensees and
operators that do not generate revenue in excess of $13.5 million
annually. Therefore, the Commission estimates that there are
approximately 850 small entity MDS (or BRS) providers, as defined by
the SBA and the Commission's auction rules.
52. Educational institutions are included in this analysis as small
entities; however, the Commission has not created a specific small
business size standard for ITFS (now EBS). The Commission estimates
that there are currently 2,032 ITFS (or EBS) licensees, and all but 100
of the licenses are held by educational institutions. Thus, the
Commission estimates that at least 1,932 ITFS licensees are small
entities.
53. In the 1998 and 1999 LMDS auctions, the Commission defined a
small business as an entity that has annual average gross revenues of
less than $40 million in the previous three calendar years. Moreover,
the Commission added an additional classification for a ``very small
business,'' which was defined as an entity that had annual average
gross revenues of less than $15 million in the previous three calendar
years. These definitions of ``small business'' and ``very small
business'' in the context of the LMDS auctions have been approved by
the SBA. In the first LMDS auction, 104 bidders won 864 licenses. Of
the 104 auction winners, 93 claimed status as small or very small
businesses. In the LMDS re-auction, 40 bidders won 161 licenses. Based
on this information, the Commission believes that the number of small
LMDS licenses will include 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 as defined by the SBA and the Commission's
auction rules.
54. 218-219 MHz Service. The first auction of 218-219 MHz spectrum
resulted in 170 entities winning licenses for 594 Metropolitan
Statistical Area (MSA) 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, 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.
These size standards will be used in future auctions of 218-219 MHz
spectrum.
55. 24 GHz--Incumbent Licensees. This analysis may affect incumbent
licensees who were relocated to the 24
[[Page 37920]]
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. 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.
56. 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.
Satellite Service Providers
57. Satellite Telecommunications. Since 2007, the SBA has
recognized satellite firms within this revised category, with a small
business size standard of $13.5 million. The most current Census Bureau
data, however, are from the (last) economic census of 2002, and the
Commission will use those figures to gauge the prevalence of small
businesses in this category. Those size standards are for the two
census categories of ``Satellite Telecommunications'' and ``Other
Telecommunications.'' Under both prior categories, such a business was
considered small if it had, as now, $13.5 million or less in average
annual receipts.
58. The first category of Satellite Telecommunications ``comprises
establishments primarily engaged in providing point-to-point
telecommunications services to other establishments in the
telecommunications and broadcasting industries by forwarding and
receiving communications signals via a system of satellites or
reselling satellite telecommunications.'' For this category, Census
Bureau data for 2002 show that there were a total of 371 firms that
operated for the entire year. Of this total, 307 firms had annual
receipts of under $10 million, and 26 firms had receipts of $10 million
to $24,999,999. Consequently, the Commission estimates that the
majority of Satellite Telecommunications firms are small entities that
might be affected by its action.
59. The second category of Other Telecommunications ``comprises
establishments primarily engaged in (1) providing specialized
telecommunications applications, such as satellite tracking,
communications telemetry, and radar station operations; or (2)
providing satellite terminal stations and associated facilities
operationally connected with one or more terrestrial communications
systems and capable of transmitting telecommunications to or receiving
telecommunications from satellite systems.'' For this category, Census
Bureau data for 2002 show that there were a total of 332 firms that
operated for the entire year. Of this total, 303 firms had annual
receipts of under $10 million and 15 firms had annual receipts of $10
million to $24,999,999. Consequently, the Commission estimates that the
majority of Other Telecommunications firms are small entities that
might be affected by its action.
Cable and OVS Operators
60. In 2007, the SBA recognized new census categories for small
cable entities. However, there is no census data yet in existence that
may be used to calculate the number of small entities that fit these
definitions. Therefore, the Commission will use prior definitions of
these types of entities in order to estimate numbers of potentially-
affected small business entities. In addition to the estimates provided
above, the Commission considers certain additional entities that may be
affected by the data collection from broadband service providers.
Because section 706 requires it to monitor the deployment of broadband
regardless of technology or transmission media employed, the Commission
anticipates that some broadband service providers will not provide
telephone service. Accordingly, the Commission describes below other
types of firms that may provide broadband services, including cable
companies, MDS providers, and utilities, among others.
61. Cable and Other Program Distribution. The Census Bureau defines
this category as follows: ``This industry comprises establishments
primarily engaged as third-party distribution systems for broadcast
programming. The establishments of this industry deliver visual, aural,
or textual programming received from cable networks, local television
stations, or radio networks to consumers via cable or direct-to-home
satellite systems on a subscription or fee basis. These establishments
do not generally originate programming material.'' The SBA has
developed a small business size standard for Cable and Other Program
Distribution, which is: all such firms having $13.5 million or less in
annual receipts. According to Census Bureau data for 2002, there were a
total of 1,191 firms in this category that operated for the entire
year. Of this total, 1,087 firms had annual receipts of under $10
million, and 43 firms had receipts of $10 million or more but less than
$25 million. Thus, under this size standard, the majority of firms can
be considered small.
62. Cable Companies and Systems. The Commission has also developed
its own small business size standards, for the purpose of cable rate
regulation. Under the Commission's rules, a ``small cable company'' is
one serving 400,000 or fewer subscribers, nationwide. Industry data
indicate that, of 1,076 cable operators nationwide, all but eleven are
small under this size standard. In addition, under the Commission's
rules, a ``small system'' is a cable system serving 15,000 or fewer
subscribers. Industry data indicate that, of 7,208 systems nationwide,
6,139 systems have under 10,000 subscribers, and an additional 379
systems have 10,000-19,999 subscribers. Thus, under this second size
standard, most cable systems are small.
63. Cable System Operators. The Communications Act of 1934, as
amended, also contains a size standard for small cable system
operators, which is ``a cable operator that, directly or through an
affiliate, serves in the aggregate fewer than 1 percent of all
subscribers in the United States and is not affiliated with any entity
or entities whose gross annual revenues in the aggregate exceed
$250,000,000.'' The Commission has determined that an operator serving
fewer than 677,000 subscribers shall be deemed a small operator, if its
annual revenues, when combined with the total annual revenues of all
its affiliates, do not exceed $250 million in the aggregate. Industry
data indicate that, of 1,076 cable operators nationwide, all but ten
are small under this size standard. The Commission notes that it
neither requests nor collects information on whether cable system
operators are affiliated with entities whose gross annual revenues
exceed $250 million, and therefore it is unable to estimate
[[Page 37921]]
more accurately the number of cable system operators that would qualify
as small under this size standard.
64. Open Video Services. Open Video Service (OVS) systems provide
subscription services. As noted above, the SBA has created a small
business size standard for Cable and Other Program Distribution. This
standard provides that a small entity is one with $13.5 million or less
in annual receipts. The Commission has certified approximately 45 OVS
operators to serve 75 areas, and some of these are currently providing
service. Affiliates of Residential Communications Network, Inc. (RCN)
received approval to operate OVS systems in New York City, Boston,
Washington, DC, and other areas. RCN has sufficient revenues to assure
that they do not qualify as a small business entity. Little financial
information is available for the other entities that are authorized to
provide OVS and are not yet operational. Given that some entities
authorized to provide OVS service have not yet begun to generate
revenues, the Commission concludes that up to 44 OVS operators (those
remaining) might qualify as small businesses that may be affected by
the rules and policies adopted herein.
Electric Power Generation, Transmission and Distribution
65. Electric Power Generation, Transmission and Distribution. The
Census Bureau defines this category as follows: ``This industry group
comprises establishments primarily engaged in generating, transmitting,
and/or distributing electric power. Establishments in this industry
group may perform one or more of the following activities: (1) Operate
generation facilities that produce electric energy; (2) operate
transmission systems that convey the electricity from the generation
facility to the distribution system; and (3) operate distribution
systems that convey electric power received from the generation
facility or the transmission system to the final consumer.'' The SBA
has developed a small business size standard for firms in this
category: ``A firm is small if, including its affiliates, it is
primarily engaged in the generation, transmission, and/or distribution
of electric energy for sale and its total electric output for the
preceding fiscal year did not exceed 4 million megawatt hours.''
According to Census Bureau data for 2002, there were 1,644 firms in
this category that operated for the entire year. Census data do not
track electric output and the Commission has not determined how many of
these firms fit the SBA size standard for small, with no more than 4
million megawatt hours of electric output. Consequently, the Commission
estimates that 1,644 or fewer firms may be considered small under the
SBA small business size standard.
Internet Service Providers, Web Portals, and Other Information Services
66. In 2007, the SBA recognized two new small business, economic
census categories. They are (1) Internet Publishing and Broadcasting
and Web Search Portals, and (2) All Other Information Services.
However, there is no census data yet in existence that may be used to
calculate the number of small entities that fit these definitions.
Therefore, the Commission will use prior definitions of these types of
entities in order to estimate numbers of potentially-affected small
business entities.
67. Internet Service Providers. The SBA has developed a small
business size standard for Internet Service Providers (ISPs). ISPs
``provide clients access to the Internet and generally provide related
services such as web hosting, web page designing, and hardware or
software consulting related to Internet connectivity.'' Under the SBA
size standard, such a business is small if it has average annual
receipts of $23 million or less. According to Census Bureau data for
2002, there were 2,529 firms in this category that operated for the
entire year. Of these, 2,437 firms had annual receipts of under $10
million, and an additional 47 firms had receipts of between $10 million
and $24,999,999. Consequently, the Commission estimates that the
majority of these firms are small entities that may be affected by its
action.
Other Internet-Related Entities
68. Web Search Portals. The Commission's action pertains to
interconnected VoIP services, which could be provided by entities that
provide other services such as e-mail, online gaming, web browsing,
video conferencing, instant messaging, and other, similar IP-enabled
services. The Commission has not adopted a size standard for entities
that create or provide these types of services or applications.
However, the Census Bureau has identified firms that ``operate Web
sites that use a search engine to generate and maintain extensive
databases of Internet addresses and content in an easily searchable
format. Web search portals often provide additional Internet services,
such as e-mail, connections to other Web sites, auctions, news, and
other limited content, and serve as a home base for Internet users.''
The SBA has developed a small business size standard for this category;
that size standard is $6.5 million or less in average annual receipts.
According to Census Bureau data for 2002, there were 342 firms in this
category that operated for the entire year. Of these, 303 had annual
receipts of under $5 million, and an additional 15 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.
69. Data Processing, Hosting, and Related Services. Entities in
this category ``primarily * * * provid[e] infrastructure for hosting or
data processing services.'' The SBA has developed a small business size
standard for this category; that size standard is $23 million or less
in average annual receipts. According to Census Bureau data for 2002,
there were 6,877 firms in this category that operated for the entire
year. Of these, 6,418 had annual receipts of under $10 million, and an
additional 251 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.
70. All Other Information Services. ``This industry comprises
establishments primarily engaged in providing other information
services (except new syndicates and libraries and archives).'' The
Commission's action pertains to interconnected VoIP services, which
could be provided by entities that provide other services such as e-
mail, 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 $6.5 million or less in average annual receipts. According
to Census Bureau data for 2002, there were 155 firms in this category
that operated for the entire year. Of these, 138 had annual receipts of
under $5 million, and an additional four firms had receipts of between
$5 million and $9,999,999. Consequently, the Commission estimates that
the majority of these firms are small entities that may be affected by
its action.
71. Internet Publishing and Broadcasting. ``This industry comprises
establishments engaged in publishing and/or broadcasting content on the
Internet exclusively. These establishments do not provide traditional
(non-Internet) versions of the content that they publish or
broadcast.'' The SBA has developed a small business size standard for
this census
[[Page 37922]]
category; that size standard is 500 or fewer employees. According to
Census Bureau data for 2002, there were 1,362 firms in this category
that operated for the entire year. Of these, 1,351 had employment of
499 or fewer employees, and six firms had employment of between 500 and
999. Consequently, the Commission estimates that the majority of these
firms small entities that may be affected by its action.
Description of Projected Reporting, Recordkeeping and Other Compliance
Requirements
72. In the Further Notice, the Commission proposes four additional
or modified information collections that would impose further reporting
and recordkeeping requirements on current Form 477 filers, including
small entities. Specifically, the Further Notice invites comment on
whether and how Form 477 filers should (1) report the number of voice
telephone service connections, and the percentage of these that are
residential, at the 5-digit ZIP Code or Census Tract, (2) report
information to build a map of broadband service availability, (3)
report information on broadband service pricing, and (4) report
information on actual, delivered speeds of broadband services. The
Commission invites comments on the merits and methodologies of such
information collections to include suggestions and discussions of other
alternatives not specifically discussed in the Further Notice that
would meet the objectives of the Further Notice but would impose lesser
burdens on smaller entities.
73. Based on these questions, the Commission anticipates that a
record will be developed concerning actual burden and alternative ways
in which the Commission could lessen the burden on small entities of
obtaining improved data about broadband deployment and availability
throughout the nation.
Steps Taken To Minimize Significant Economic Impact on Small Entities,
and Significant Alternatives Considered
74. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include (among others) the following four alternatives: (1)
The establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.
75. As noted above, the Further Notice invites comment on whether
and how current Form 477 filers should (1) report subscriber counts for
voice-grade lines and channels at the 5-Digit Zip Code or Census Tract
level, (2) report information to build a map of broadband service
availability, (3) report information on broadband service pricing, and
(4) report information on actual, delivered speeds of broadband
services. The Further Notice seeks comment on possible methods for
reporting the proposed information collections, as well as suggestions
of methods to maintain and report the information that achieve the
purposes of the Further Notice while minimizing the burden on reporting
entities, including small entities. This information will assist the
Commission in determining whether these various proposed information
collections would impose a significant economic impact on small
entities.
76. Based on these questions, and the alternatives discussed, the
Commission anticipates that the record will be developed concerning
alternative ways in which it could lessen the burden on small entities
of obtaining improved data about broadband availability throughout the
nation.
Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
77. None.
Ordering Clauses
78. Accordingly, it is ordered that, pursuant to sections 1 through
5, 11, 201 through 205, 211, 215, 218 through 220, 251 through 271,
303(r), 332, 403, 502, and 503 of the Communications Act of 1934, as
amended, 47 U.S.C. 151 through 155, 161, 201 through 205, 211, 215, 218
through 220, 251 through 271, 303(r), 332, 403, 502, and 503, and
Section 706 of the Telecommunications Act of 1996, 47 U.S.C. 157 nt,
this Further Notice, with all attachments, is adopted.
79. 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
Initial Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
80. It is further ordered that pursuant to applicable procedures
set forth in sections 1.415 and 1.419 of the Commission's rules, 47 CFR
1.415, 1.419, interested parties may file comments on the Broadband
Availability Mapping portion of this Further Notice of Proposed
Rulemaking on or before July 17, 2008, and reply comments on or before
August 1, 2008, and interested parties may file comments on the other
portions of this Further Notice of Proposed Rulemaking on or before
August 1, 2008, and reply comments on or before September 2, 2008.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E8-14875 Filed 7-1-08; 8:45 am]
BILLING CODE 6712-01-P