FCC DOCKET SUMMARIES

The following is a listing of significant Federal required to franchise under Section 621 of the Communications ("FCC" or "Commission") ac- Communications Act of 1934. Factors cited by the tions that were initiated from March through De- Commission included that ECI: (1) is a satellite cember 1998. The docket summaries are organ- master antenna television provider which serves ized according to the FCC bureau responsible for multiple dwelling units in the state of Michigan; the matter. The docket summaries provide brief and (2) is presently a subscriber of Ameritech's synopses and citation to the full text of the FCC video service to distribute its programming to action, but are not intended to serve for the origi- multiple dwelling units. nal text contained in the original sources. In making its determination, the Commission noted that the relationship between ECI and CABLE SERVICES Ameritech is a carrier/user relationship and sepa- ration of ownership exists between the two. Addi- tionally, Ameritech has no control over the con- tent of ECI's programming. Further, there CS DOCKET No. 97-80; REPORT No. CS 98- is capacity to provide the service to other program- 11: CS DOCKET No. 97-80; REPORT No. CS 98-11: In re Implementation of Section 304 of the ming providers. Lastly, the FCC determined that Telecommunications Act of 1996; Commercial ECI is not a cable operator required to franchise Availability of Navigation Devices, Order,June 11, because Ameritech's facilities were not con- 1998. structed at the request of ECI. The Commission adopted rules that provide for the commercial availability of set top boxes and CS DOCKET No. 98-201; REPORT No. CS other consumer equipment used to receive video 98-16: In re Satellite Delivery of Network Signals signals. The Commission adopted these rules to Unserved Households, Notice of Proposed pursuant to Congressional direction in the Tele- Rulemaking, Nov. 17, 1998. communications Act of 1996 ("1996 Act") to cre- The Commission adopted a Notice of Proposed ate rules which would enable consumers to obtain Rulemaking regarding television signals. Televi- navigation devices from commercial sources other sion signal intensity is used to determine whether than service providers. The Commission ordered a consumer is unserved by the broadcast network that multichannel video programmers must sepa- station, thus, making them eligible to receive rate out security functions from non-security func- those stations using a home satellite dish pursuant tions by July 1, 2000. An exception was made for to the 1988 Satellite Home Viewer Act ("SHVA"). the navigation devices that operate throughout The SHVA limits the ability to receive broadcast the continental United States and are available network affiliate programming via satellite to from unaffiliated sources. Additionally, the Com- those that are unserved, determined by Grade B mission established a prohibition on the sale or intensity. The Commission requested comments lease of new integrated boxes as of January 1, addressing its authority to amend the Grade B 2005. Until that time, the Commission has ap- definition as it relates to the SHVA as well as how proved the offering of devices that have security it may be redefined. The Commission acknowl- functions and non-security functions integrated. edged that it does not appear to have statutory au- thority under the SHVA to prevent subscribers in- FCC REPORT No. CS 98-9: In re Entertain- volved in the court cases from losing the service. ment Connections Inc.; Motion of Declaratory Ruling, Order,June 30, 1998. CS DOCKET No. 96-83; REPORT No. CS 98- The Commission ruled that Entertainment 17: In re Implementation of Section 207 of the Connections, Inc. ("ECI") is not a cable operator Telecommunications Act of 1996; Restrictions on COMMLAW CONSPECTUS [Vol. 7

Over-the-Air Reception Devices: Television mission proposed that these duties be performed Broadcast Service and Multichannel Multipoint by the Universal Service Administrative Company Distribution Service, Order, Nov. 20, 1998. ("USAC"), the entity that currently administers The Commission amended its rule under Sec- the high cost and low income support mecha- tion 207 of the Telecommunications Act of 1996 nisms, and that performs billing, collection, and to promote consumer choice and competition in disbursement functions for all of the universal ser- the video programming distribution market. The vice support mechanisms. rule prohibits any restrictions that impair the use Noting that the USAC Board includes individu- of dishes and antennas in rented apartments, als with the experience and expertise to under- homes or dwellings, and adjacent outside proper- stand and implement the distinct missions of the ties that are exclusively used by the renter. The schools, libraries and rural health care support Commission concluded that the rule does not ex- mechanisms, as well as, significant industry-wide tend to common areas that are owned by a land- representation of both contributors to and benefi- lord or community association. The Commission ciaries of the universal service support mecha- stated that it would not impose an affirmative duty nisms, the Commission concluded the best option on landlords or community associations to install in accordance with Congress' request would be or give up their property to permit viewers to in- for USAC to serve as the permanent, sole adminis- stall Section 207 devices on common areas. trator. The Commission indicated Congress' request concerning revision of the administrative CS DOCKET No. 98-102; REPORT No. CS struc- ture was sparked in part by a recent letter from 98-18: Fifth Annual Report on Competition in Video Markets, Dec. 17, 1998. the General Accounting Office ("GAO") which The Commission adopted and submitted to contended that the Commission lacked authority to Congress its Fifth Annual Report on competition direct the National Exchange Carrier Associa- in markets for the delivery of video programming. tion, as a condition of its appointment as tempo- The report's findings reveal that cable television rary universal service administrator, to create sep- continues to maintain a dominant market posi- arate entities for the purposes of administering tion because it is the primary delivery of technol- support for schools and libraries and rural health ogy for the distribution of multichannel video care providers. While the Commission argued it programming delivery ("MVPD"). The Commis- acted lawfully, it welcomed action by Congress to sion did find that the number of subscribers of resolve the issues raised by the GAO's letter. Ac- noncable MVPD's have increased as a result of the cordingly, the Commission respectfully requested growth of direct broadcast satellite services. How- from Congress specific statutory authority that ever, other noncable MVPDs have declined in would eliminate any question concerning the their number of subscribers. The Commission FCC's authority in this regard. also found that the 1996 Act's removal of barriers to LEC entry into the video market has not yet FCC DOCKET No. 98-90; CC DOCKET No. generated competition. 98-67: In re Telecommunications Relay Services and Speech-to-Speech Services for Individuals COMMON CARRIER with Hearing and Speech Disabilities, Notice of Pro- posed Rulemaking, May 14, 1998. CC DOCKET No. 98-13: Report to Congress, Re- The Commission proposed several ways to im- port in Response to Senate Bill 1768 and Confer- prove the quality of existing telecommunications ence Report on H.R. 3579, May 8, 1998. relay services ("TRSs") and expand those services In a Report submitted to Congress, the FCC for better use by the 2.5 million Americans with proposed that a single entity would administer all speech disabilities in order to advance the goals of forms of federal universal service support. The Title IV of The Americans With Disabilities Act of Report responded to Congress' request that the 1990. Among the proposals included in the No- Commission propose a single entity for adminis- tice of Proposed Rulemaking were the following: tering universal service support for rural health (1) the costs of speech-to-speech services and care providers, schools and libraries. The Com- video relay interpreting should be recoverable 1999] FCC Docket Summaries from theTRS Fund; (2) all common carriers pro- that a single entity, USAC, administer all forms of viding voice transmission services must ensure universal service support. The Order noted that that speech-to-speech services are available the Schools and Libraries Corporation ("SLC"), throughout their service areas within two years of the Rural Health Care Corporation ("RHCC"), adoption of final rules; (3) the current TRS mini- and USAC must file with the Commission, for its mum standards should be strengthened; and (4) approval, a joint plan of reorganization by July 1, the TRS enforcement rules should be amended to 1998. Finally, the FCC lowered the level of com- improve the Commission's oversight of certified pensation for the officers and employees of SLC state TRS programs. and RHCC, effective July 1, 1998.

CC DOCKET No. 96-45: In re Federal-State CC DOCKET No. 96-45: In re Federal-State Joint Board on Universal Service, Order,June 12, Joint Board on Universal Service, Order, July 17, 1998. 1998. The FCC modified the mechanism by which The FCC released an Order asking the Federal- schools and libraries will receive discounts on State Joint Board on Universal Service for recom- communication services. In the Order, the Com- mendations related to the amount of universal mission revised: (1) the funding year for schools service support that non-rural telephone compa- and libraries support mechanism; (2) froze the nies should receive for serving high cost areas. Is- amount of funding at current rates; (3) revised sues referred to the Joint Board included an ap- the disbursement rules to ensure that the most propriate methodology for determining the disadvantaged schools and libraries get priority amount of high-cost support for non-rural carriers support; and (4) made other administrative (i.e., a method for distributing support among the changes consistent with the intent of Congress. states and, if applicable, the share of total support The decision also froze the amount of funding to be provided by federal mechanisms). The year for the schools and libraries discount mecha- Commission asked if the current "25/75" ap- nism from a calendar year cycle (January 1 - De- proach is maintained, under what circumstances a cember 31) to a fiscal year cycle (July 1 - June state or carrier should qualify to receive more 30). In order for the transition to take effect im- than 25 percent of its total high cost support form mediately, the first funding cycle will be extended federal support mechanisms. by six months. Also referred to the Joint Board was the issue of The decision also freezes the amount of fund- the extent to which federal universal service sup- ing for schools and libraries and rural health care port should be applied to the intrastate jurisdic- providers at current rates. With regard to the tion. Along these lines, the Commission asked schools and libraries support mechanism, the whether: (1) interstate access charges should be Commission directed the Universal Service Ad- reduced; (2) the federal universal service policy ministrative Company ("USAC") to collect and should support state efforts to make intrastate disperse no more than $325 million per quarter support mechanisms explicit; and (3) questions for the third and fourth quarters of 1998 and the concerning the relationship between the jurisdic- first and second quarters of 1999. Funding col- tion to which universal service funds are applied lected for schools and libraries will be assessed, and the appropriate revenue base upon which therefore, at a rate of 0.0075 - that is, three- contributions should be assessed. quarters of one percent of total telecommunica- Also referred to the Joint Board was the issue of tions revenues. The Commission also directed the extent and manner to which it is reasonable USAC to collect and disperse no more than $25 for providers to recover universal service contribu- million per quarter for the third and fourth tions through rates, surcharges, or other means. quarters of 1998 for the rural health care mecha- nism. The Commission also reiterated changes it is CC DOCKET Nos. 98-146, 98-11, 98-26, 98- making to the administration of universal service, 32, 98-15, 98-78, 98-91, 98-147: In re Deploy- consistent with the will of Congress., In its May 8, ment of Wireline Services Offering Advanced 1998 Report to Congress, the Commission proposed Telecommunications Capability, Notice of Proposed COMMLAW CONSPECTUS [Vol. 7

Rulemaking, In re Inquiry Concerning the Deploy- compels incumbents to make their network ele- ment of Advanced Telecommunications Capabil- ments available for use by competitors at cost- ity to All Americans in a Reasonable and Timely based rates. The Commission concluded that Fashion and Possible Steps to Accelerate Such De- Congress intended for the 1996 Act to be techno- ployment Pursuant to Section 706 of the Telecom- logically neutral and was designed to ensure com- munications Act of 1996, Notice of Inquiy, Aug. 6, petition in all telecommunications markets. As a 1998. result, the Commission found that an incumbent The FCC initiated two proceedings intended to local telephone company must interconnect its create marketplace conditions conducive to the data network with the data networks of competi- nationwide deployment of advanced telecommu- tors. The Commission further concluded that it nications services, (e.g., as high-speed Internet ac- did not have the statutory authority to forbear cess and video telephony) by all telecommunica- from the critical market-opening requirements tions providers. In the first proceeding, the placed on incumbents under Sections 251 and Commission adopted a Notice of Inquiry pursu- 271 of the Act until those requirements have been ant to Section 706 of the Telecommunications Act fully implemented. of 1996, which directs the FCC to examine whether advanced telecommunications services are being offered to all Americans on a reason- CC DOCKET No. 98-170: In re Truth-in-Billing able and timely basis. If the Commission's find- and Billing Format, Notice of Proposed Rulemaking, ings are negative, the FCC will take immediate ac- Sept. 17, 1998. tion to remedy the situation, as directed by The FCC proposed to make telephone bills statute. Accordingly, the Commission asked for more consumer-friendly by providing customers comment on what constitutes "advanced telecom- with information they need to make informed munications capability," the extent to which such choices in a competitive telecommunications mar- capabilities are being deployed, and what actions ketplace and to protect themselves against unscru- may be necessary to encourage deployment. pulous practices. In a Notice of Proposed In the second proceeding, the Commission Rulemaking, the Commission outlined three adopted a Notice of Proposed Rulemaking guidelines and asked for comment from the ("NPRM") that offers an incumbent local tele- states, consumer groups, the industry, and gen- phone company the option to provide advanced eral public on proposals that would follow these services through a separate affiliate on a largely guidelines. deregulated basis while strengthening competi- First, telephone bills should be clearly organ- tors' access to the piece parts of the incumbent's ized and highlight any new charges or changes to network and to floor space in the incumbent's consumers' services. The Commission asked for central office (e.g., collocation space). In the comment on whether: (1) bills should contain a NPRM, the Commission stated that, under the separate page or section that highlights any 1996 Act, there is an optional alternative pathway changes in the consumer's service since the last for an incumbent local telephone company that is bill, including the addition of a new provider or willing to offer advanced services on the same new charges; (2) telephone companies should footing as other competitors. Additionally, the present separate categories of services (such as Commission proposed ways to facilitate the ability charges for local, long distance, and miscellane- of new entrants to offer advanced services on an ous services) in clearly separate sections within equal footing with an incumbent. the phone bill; and (3) bills should contain a sep- The Commission also issued an Order address- arate section summarizing the current status of ing issues raised in petitions filed by several Bell the consumer's services. Operating Companies ("BOCs") and the Associa- Second, telephone bills should contain full and tion for Local Telecommunications Services. The non-misleading descriptions of all charges and BOCs requested relief from certain of the 1996 clear identification of the service provider respon- Act's requirements that are generally applicable sible for each charge. The Commission proposed to incumbents' provision of telecommunications, that: (1) each charge on a telephone bill-be ac- including the unbundling requirement which companied by a brief, plain language description 1999] FCC Docket Summaries of the service rendered; and (2) the name of the Qwest violated Section 271 of the 1996 Act. The service provider be clearly and conspicuously Commission, in determining whether Ameritech identified in association with its charges. In addi- and U S West are providing long distance service tion, the Commission asked for comment on the through these business agreements within the descriptions of charges resulting from federal reg- meaning of Section 271, assessed whether the ulatory action, such as charges intended to re- companies' involvement in the long distance mar- cover telephone companies' costs in obtaining ac- ket enabled them to obtain competitive advan- cess and meeting universal service obligations. tages, thereby reducing their incentive to cooper- Third, telephone bills should contain clear and ate in opening their local markets to competition. conspicuous disclosure of any information con- The Commission found that: (1) the inclusion sumers need to make inquiries about charges. of Qwest's long distance service in the Com- The Commission found that, particularly in the pleteAccess and Buyer's Advantage programs ena- case of slamming and cramming, consumers often bled Ameritech and US West to obtain competi- experience considerable difficulty in contacting tive advantages, including the ability to provide the company whose charges appear on the bill. one-stop shopping for local and long distance ser- The Commission therefore proposed that each vice; (2) Ameritech and US West held themselves bill contain the name of each service provider, a out to customers as providers of long distance ser- business address, and a toll-free telephone vice by marketing and selling, under a single number for the receipt of consumer inquiries and brand name, Qwest's long distance service and complaints. In addition, the Commission asked their own local and intraLATA (short haul) long for any other proposals-to ensure that consumers distance service, as well as, by performing cus- have the contact information they need to resolve tomer service functions in connection with billing disputes. Qwest's long distance service; and (3) Ameritech and US West performed various functions and ac- tivities under their business agreements with FCC REPORT No. CC 98-31: FCC Finds Un- Qwest that are typically performed by those who lawful Ameritech and US Wests' Business Agreements resell long distance service. The Commission con- With Qwest; Companies May Not Provide Long Dis- cluded that Ameritech and US West were indeed tance Service Before Opening Their Local Markets to providing long distance service in violation of Sec- Competition, Sept. 28, 1998. tion 271. The FCC ruled that business agreements en- Because the CompleteAccess and Buyer's Ad- tered into by Ameritech Corp. and US West Com- vantage programs are unlawful with regard to Sec- munications, Inc. violate the 1996 Act by enabling tion 271, the Commission found it unnecessary to the companies to provide long distance service to reach the issue of whether these programs also vi- their local customers prior to demonstrating that olate Section 251 (g) of the 1996 Act. their local telephone markets are open to compe- tition. The Commission's decision resolved com- plaints to the FCC concerning the lawfulness of CC DOCKET No. 98-121: In re Application of two separate business agreements between Amer- BellSouth Corporation, BellSouth Telecommuni- itech and Qwest Communications Corp. cations, Inc., and BellSouth Long Distance, Inc., ("Qwest"), and between US West and Qwest. The For Provision of In-Region, InterLATA services in agreements resulted in both Ameritech and US Lousiana, Oct. 13, 1998. West providing, under their own brand names, a The FCC denied BellSouth's second applica- package of services that includes Qwest's long dis- tion to provide long distance service in Louisiana tance service, before gaining authorization to pro- and provided further guidance as to what the vide in-region long distance service. The decision company must do to comply with the statute in required Ameritech and US West to cease offer- areas where the application fell short. In addi- ing Qwest's long distance service as part of the tion, the Commission ruled that BellSouth need companies' CompleteAccess and Buyer's Advan- only certify in any future application for Louisi- tage programs, respectively. ana, that it still satisfies the requirements of the The Commission also determined that Amer- checklist items that it has met in this application, itech's and US West's business agreements with thus streamlining the authorization process. COMMLAW CONSPECTUS [Vol. 7

On July 9, 1998, BellSouth filed its second ap- tion on recommendations from the Federal-State plication for authorization under Section 271 of Joint Board on Universal Service. the 1996 Act to provide long distance service in The Commission's process to adopt a mecha- Louisiana. The Commission reviewed all aspects nism to estimate forward-looking economic cost is of BellSouth's application and found that Bell- proceeding in two stages. In the first stage, the South satisfied the requirements of six checklist Commission is adopting a framework, or model items and part of a seventh. The Commission platform, which accounts for elements that are es- concluded that, in any future application to pro- sentially fixed, such as network design, network vide long distance service in Louisiana, BellSouth engineering, and soil and terrain. In the second may incorporate by reference its showing on the stage, the Commission will select the inputs for checklist items deemed satisfied. However, the the model, such as the costs of network compo- Commission noted that these items may be chal- nents. lenged by commenters in a future application. The model platform adopted here combines el- Although BellSouth undertook significant ef- ements from each of the two industry-sponsored forts to institute policies and procedures to en- models, along with innovations developed by sure compliance with Section 272, it did not meet Commission staff. This platform allows the Com- all of that provision's requirements. In particular, mission to estimate the cost of building a tele- it did not demonstrate adequately that it disclosed phone network to serve subscribers at their actual all transactions with its long distance affiliate, geographic locations. The model is capable of be- which allows its affiliate to maintain superior ac- ing adjusted to reflect any evolution in the defini- cess to information about these transactions. As a tion of supported services, and is compatible with result, unaffiliated entities lack the information rural Americans' ability to use the Internet and necessary to take advantage of the same rates, other advanced telecommunications and informa- terms, and conditions enjoyed by BellSouth's affil- tion services. As such, the model platform will iate. In addition, BellSouth failed to provide non- serve as a solid foundation for further decisions discriminatory access to its operation support sys- that will determine the amount of universal ser- tems ("OSS"), and thereby failed to provide the vice support to be provided to non-rural eligible same information to unaffiliated entities that it telecommunications carriers. provides to its affiliate. The Commission reaffirmed its prior conclu- CC DOCKET No. 96-45: In re Federal-State sion that it has discretion to identify and weigh relevant factors in determining whether BOC en- Joint Board on Universal Service, Order and Notice try into a particular in-region long distance mar- of Proposed Rulemaking, Oct. 22, 1998. ket is consistent with the public interest. The FCC took action to ensure that the univer- sal service support mechanisms operate fairly and equitably, particularly with respect to wireless tele- CC DOCKET Nos. 96-45 AND 97-160: In re communications carriers. In a Memorandum Federal-State Joint Board on Universal Service, Opinion and Order and Further Notice Proposed Fifth Report and Order, Oct. 22, 1998. Rulemaking, the Commission addressed four is- The FCC adopted the framework for estimating sues. the costs incurred by certain telephone compa- First, the Commission provided wireless tele- nies for providing services to consumers in rural, communications providers with interim guide- insular, and other high cost areas. Combined lines for reporting their percentage of interstate with specific variables, or "inputs," that will be de- wireless telecommunications revenues. Specifi- termined later, this framework will provide cost cally, the Commission established "safe-harbor" information that can be used as part of the calcu- percentages that wireless carriers may use until lation of the amount of universal service support adoption of final rules. These "safe-harbor" per- that non-rural carriers may receive for serving centages will assist wireless carriers in allocating high cost areas. The amount of support available revenues between the interstate and intrastate ju- to carriers, however, ultimately depends upon risdictions. other factors, including the model input values Second, the Commission asked for comment under consideration and upon Commission ac- on establishing rules to deal with those situations 1999] FCC Docket Summaries

in which universal service contributors cannot de- the Board, unless the USAC Board disapproves of rive the amounts of their intrastate and interstate the action by a two-thirds vote. The budgets pre- end-user telecommunications revenues readily pared by each committee will be subject to review from their books of account. by the full USAC Board. Third, the Commission asked for comment on The order adopted three modifications to the the extent to which its universal service rules facil- reorganization plan. First, in order to provide ad- itate the provision of supported services by service equate representation of rural health care provid- providers, such as wireless telecommunications ers, the Commission added one rural health care providers and cable operators, that historically representative to the USAC Board and to the have not provided services eligible for federal uni- Board's Rural Health Care Committee. Second, versal service support. The Commission asked for to more fully reflect both rural and non-rural lo- comment on the extent to which such providers cal telephone company interests, the Commission are, in fact, supplying services eligible for support added one incumbent local telephone company and what additional steps may be necessary to fa- representative to the High Cost and Low Income cilitate the participation of new providers and Committee. Third, the Commission declined to promote competition in the universal service con- adopt the plan's recommendation to divest USAC text. from the National Exchange Carrier Association Finally, the Commission asked for comment on ("NECA") at this time. Rather, consistent with the how much, if any, local usage eligible telecommu- May 1998 Report to Congress, the Commission nications carriers should be required to provide said it would review after one year whether USAC to customers as part of a "basic service" package. should be divested from NECA.

CC DOCKET Nos. 97-21 AND 96-45: In re CC DOCKET No. 96-45: In re Federal-State Change to the Board of Directors of the National Joint Board on Universal Service, Nov. 23, 1998. Exchange Carrier Association, Inc.; Federal-State The Federal-State Joint Board on Universal Ser- Joint Board on Universal Service, Order, Nov. 19, vice made recommendations to the FCC on how 1998. to ensure that local telephone rates in rural and The FCC appointed the Universal Service Ad- high cost areas remain affordable and reasonably ministrative Corp. ("USAC") permanent adminis- comparable to rates in urban areas both today trator of all forms of federal universal service sup- and as America's telecommunications market- port as of January 1, 1999. This action responded place moves from monopoly to competition. The to Congress' directive that a single entity adminis- Joint Board recommended a federal high cost ter universal service support for rural health care support mechanism for non-rural carriers that en- providers, schools and libraries. ables rates to remain affordable and reasonably The Commission appointed USAC as universal comparable, even as competition develops, but service administrator on a permanent basis, sub- that is no larger than necessary to meet the goals ject to the Commission's determination after one of the 1996 Act. year that USAC is administering support in an ef- Under the Joint Board's recommended ap- ficient, effective, and competitively neutral man- proach, the federal mechanism would provide ner. As proposed by the reorganization plan, the necessary support as set in accordance with a two- Commission ruled that the USAC Chief Executive step process. First, the Commission should deter- Officer will have overall management responsibil- mine if the cost of serving an area is significantly ity for all of the universal service support mecha- above a national average. Second, for areas that nisms. USAC'S operations will have three divi- are more expensive to serve, the Commission sions: the Schools and Libraries Division, the should determine whether the state has sufficient Rural Health Care Division, and the High Cost resources to provide the support needed. In cases and Low Income Division. In addition, three where a state lacks the resources to keep tele- committees of the USAC Board of Directors will phone rates reasonably comparable, the federal oversee the operations of the three divisions. Any mechanism would provide the remaining amount action taken by a committee with regard to its re- of support. spective support mechanism will be binding on The recommendation stated that the Commis- COMMLAW CONSPECTUS [Vol. 7 sion should provide guidance to telecommunica- days after the unauthorized switch. The Commis- tions carriers regarding the extent to which they sion noted that a 30-day absolution period pro- recover their universal service contributions from vides incentive for consumers to review their consumers, to prevent carriers from over-recover- phone bills carefully and promptly, and it pro- ing their contribution amounts. Specifically, the vides incentive for carriers that legitimately sign Commission should consider adopting a rule up customers to verify switches properly so as to prohibiting carriers from establishing a line item have solid evidence of the change. charge to consumers at a rate greater than the The Commission modified the methods by carrier's own universal service assessment rate. which a carrier can fulfill its obligation to verify The recommendation further stated that the consumers' authorizations to change their tele- Commission should take decisive action to ensure phone service providers. In particular, the Com- that consumers are not misled as to the nature of mission eliminated the "welcome package" as a charges on bills associated with recovering univer- verification method. Under that method, a car- sal service contributions. Noting that interstate rier that signs up a customer mails to the cus- carriers are required to contribute to universal tomer a package containing a postcard that the service but not required to impose such charges customer has 14 days to mail back if he or she on consumer bills, the Joint Board recommended wishes to cancel the charge. The Commission that the Commission consider prohibiting carriers noted that this method has been subject to abuse from incorrectly describing such charges as being by unscrupulous carriers, and consumers should mandatory or federally-approved. Such mislead- not have to take affirmative action to avoid being ing descriptions may indicate to consumers that slammed. As a result, there are now three accept- all carriers are imposing the same charges and, able methods to verify carrier changes: a con- therefore, discourage consumers from shopping sumer signature on an authorization form, known for lower charges from competing carriers. as a Letter of Agency; an electronic authorization, usually resulting from a customer-initiated call to toll-free number; and verification by an independ- CC DOCKET No. 94-129: In re Implementa- ent third party. tion of the Subscriber Carrier Selection Changes The Common Carrier Bureau's Enforcement Act of 1996 Provisions of the Telecommunications Division also announced its new Consumer Net- Rules Concerning Unuathorized and Policies and work project, a plan to provide consumers with Changes of Consumers Long Distance Carriers, tools to better protect themselves from telephone- Second Report, Order and Notice of Proposed Rulemak- related fraud, including slamming, as well as to ing, Dec. 17, 1998. provide consumers an easy means to file com- The FCC adopted new rules that will relieve plaints. The Consumer Network will be imple- consumers who have had their telephone service mented in three stages: a new web site which will provider changed without their consent, a prac- allow consumers to file complaints electronically; tice known as "slamming," from paying charges the filing of complaints over the telephone, in- imposed by the unauthorized carrier for up to 30 cluding calls placed to the FCC's toll-free number; days after being slammed. In addition, the Com- and the establishment of an electronic interface mission strengthened the verification procedures with carriers. used to confirm telephone carrier switches and broadened the scope of its anti-slamming rules to further protect consumers. The Commission also INTERNATIONAL unveiled a series of new initiatives that will make it quicker and easier for consumers to file com- IB DOCKET No. 98-60; REPORT No. IN 98- plaints about slamming and other telephone-re- 18: In re Comsat Corporation, Order and Notice of lated fraud, as well as speed resolution of con- Proposed Rulemaking, Apr. 24, 1998. sumer complaints. The Commission approved the request of Com- Under the new rules, any carrier that a con- sat Corporation for reclassification as a non-domi- sumer calls to report being slammed must inform nant common carrier. Comsat was reclassified in the consumer that he or she is not required to pay the competitive markets of INTELSAT switched any slamming charges incurred for the first 30 voice, private line, and occasional use video serv- 1999] FCC Docket Summaries ices. It was reclassified in all product markets of of international switched resale services from the full time video and earth station services. The United States to all points, after determining that reclassification will enable Comsat to file tariffs on TSC has fulfilled the conditions of its license con- one-day notice without economic cost support. ditionally granted in October 1997. The Interna- The Commission held that Comsat's reclassifi- tional Bureau approval was conditioned on the cation has eliminated the rate of return regula- demonstration by TSC that it had offered other tion in its non-dominant markets. Further, the U.S. carriers one-stop shopping and Paid 800 Commission issued a Notice of Proposed rule agreements on the same terms available to Sprint. making to consider replacing the rate of return The third condition related to the calculation of regulation in Comsat's dominant market with an proportionate return traffic to the U.S. After eval- incentive-based regulation. The reclassification uating TSC's filing on May 26, 1998, the Bureau does not require structural separation of Comsat's held that Telemex has satisfied the conditions INTELSAT services and other activities. and no longer discriminates in favor of Sprint.

1B DOCKET No. 96-148; REPORT No. IN 98- IN DOCKET No. 98-172; REPORT No. IN 98- 44: In re American Telephone and Telegraph 52: Commission Proposes to Redesignate Portions of the Company Petition for Waiver of the International 18 GHZ Band; Allow Blanket Licensing of Fixed Satel- Settlements Policy for Parallel International lite Service Earth Stations in the KA-Band; Allocate Ad- Routes for Accounting Rates and Division of Tolls ditional Spectrum for the Broadcast Satellite Service, for Packet Switched Service With the United King- Sept. 17, 1998. dom, Memorandum Opinion and Order, Aug. 6, The Commission proposed to redesignate the 1998. 18 GHZ band among currently allocated services. The Commission proposed rules to reform the The Commission would ensure terrestrial fixed international settlement policy. The Commission operators continued access to spectrum at 18 projected the reformation will promote greater GHZ while allowing orbit and satellite service op- competition and lower international calling erators to deploy their new satellite systems. The prices. The Commission proposal reflects the Commission proposed to allow orbit and satellite 1997 World Trade Organization Agreement on earth stations in the Ka-band to operate under a Basic Telecommunications that made commit- single system license in those segment of the band ments to open the markets to competition for which is designated as their primary use. Lastly telecommunications services. the Commission proposed to align the domestic Specifically, the Commission proposed to re- Table of Allocations with the International Tele- move the international settlement policy and con- communication Union Region 2 Table of Alloca- tract filing requirements for arrangements with tions for Broadcast Satellite Service use. foreign carriers which lack market power in WTO countries. Additionally, the Commission re- quested comment on whether to abandon the in- MASS MEDIA ternational settlement policy altogether for those FCC DOCKET No. 98-231; MM DOCKET No. carriers from WTO countries which meet the in- 97-217: In reAmendment of Parts 1, 21 and 74 to ternational simple resale standard. Further, the Enable Multipoint Distribution Service and In- Commission requested comment on modifying structional Television Fixed Service Licenses to the governing rules on international simple re- Engage in Fixed Two Way Transmission, Report sale. Lastly, the Commission proposed changes to and Order, Sept. 17, 1998. simplify the accounting rate filing requirements. The Commission has approved the offering of two-way digital services by Multipoint Distribu- 1B REPORT NO. IN 98-46: InternationalBureau tions Services ("MDS") and Instructional Televi- Authorizes Telmex/Sprint Communications, L.L. C. to sion Fixed Services ("ITFS") licensees. The new Commence InternationalSwitched Resale Services, Au- rules permit licensees to use all or part of any of gust 7, 1998. their 6 MHz channels for two-way service. Opera- The Commission approved Telemex/Spring tors will be issued blanket licenses for "response Communications, L.L.C ("TSC") commencement station hubs," which will serve as collection points COMMLAW CONSPECTUS [Vol. 7 for response station signals. Licensees will not gram requirements were unconstitutional as ap- have to apply for each license separately. The Re- plied to minorities because the Commission's reg- port and Order allows for flexibility in two-way sys- ulatory rules "pressure stations to maintain a work tem design by permitting licensees to combine force that mirrors the racial breakdown of their multiple channels to accommodate wider 'metropolitan statistical area."' While requiring bandwidth uses, the "subchannelizing" of 6 MHz outreach efforts, the Commission's proposed channels for smaller bandwidth uses, and by al- rules do not dictate that employers compare their lowing response stations and boosters to operate workforce with that of the local labor workforce up to maximum permitted MDS and ITFS power or allow the Commission to use such a compari- levels. The Report and Order specifically retains son when assessing an EEO program. Although the existing 20-hour per-channel requirement for the holding in Lutheran Church did not address educational usage of ITFS channels, but relaxes cable entities, the Commission also proposed to content restrictions by allowing for fulfillment of modify its EEO rules for cable and MVPD entities these requirements through data, voice or video to make them consistent with any new broadcast transmissions, and by requiring only that the us- EEO rules. age be in furtherance of the educational mission The Commission invited comment on its belief of an accredited institution offering formal educa- that it has the statutory authority to retain the tional courses. The Report and Order also re- anti-discrimination provisions in its broadcast quires that ITFS licensees operating digital sys- EEO rules. The Commission also requested com- tems retain at least five percent of the capacity of ment on its proposal to reinstate the statistical em- their licensed spectrum for education usage. In ployment data collection contained in the Annual addition, ITFS licensees will be accorded interfer- Employment Report to be used to monitor indus- ence protection on the basis of a 35-mile radius try trends. The Commission additionally asked protected service area, along with, the currently- for comment on: (1) specific recruitment require- provided registered receive-site protection. Rules ments that could encourage entities to expand will require prior notification of the activation of their pools of applicants without creating prefer- a response station transmitter located within 1960 ences for female or minority applicants; (2) feed of a registered ITFS receive site, a prompt whether it should relax EEO reporting and rec- remedy of any interference caused to an ITFS ord-keeping requirements for small broadcast sta- user, and the immediate cessation of the opera- tions or broadcast stations in small markets; and tions of any transmitter causing interference that (3) whether stations catering to religious audi- is not remedied promptly. The Report and Order ences should .be allowed to consider religious be- also permits ITFS licensees to exchange channels lief as a bona fide occupational qualification for and satisfy some or all of their educational usage radio station employees. requirements on other channels in the wireless cable system, and increases permissible lease term limits from 10-15 years. FCC DOCKET No. 98-307; MM DOCKET No. 93-25: In re Implementation of Section 25 of the Cable Television Consumer Protection and Com- FCC DOCKET No. 305; MM DOCKET Nos. petitive Act of 1992, Report and Order, Nov. 19, 98-204, 96-16: In re Review of the Commission's 1998. Broadcast and Cable Equal Employment Oppor- The Commission adopted rules implementing tunity Rules and Policies, and Termination of the Section 25 of the Cable Television Consumer Pro- EEO Streamlining Proceeding, Notice of Proposed tection and Competition Act of 1992, which estab- Rulemaking, Nov. 19, 1998. lished certain public interest obligations on direct The Commission proposed new EEO rules that broadcast satellite ("DBS") providers. The Com- would require broadcast licensees to inform wo- mission ruled that the statute requires that DBS men and members of minority groups of job va- providers set aside four percent of their channel cancies. The Commission's proposed rules came capacity for noncommercial educational or infor- in response to the D.C. Court of Appeals decision mational programming. The Commission inter- in Lutheran Church-Missouri Synod v. FCC, which preted the prohibition on editorial control under held that the Commission's broadcast EEO pro- Section 335(b) (3) to allow DBS providers to 1999] FCC Docket Summaries

choose among qualified national education pro- randum Opinion and Order on Reconsideration of the gramming suppliers. However, the Commission Fifth and Sixth Report and Orders, Dec. 18, 1998. circumscribed that discretion by limiting the The Commission revised and clarified certain number of set-aside channels a single national ed- FCC DTV allotment policies. First, the FCC modi- ucational and informational programmer can use. fied its policy restricting requests for maximiza- Specifically, the limit is one channel, unless all tion of UHF DTV station power to 200 kW to pro- qualified entities that have sought access have vide flexibility for DTV licensees to request power been offered access on at least one channel. In increases up to 1,000kW. Applications proposing addition, as specifically mandated by Sections such power increase that would increase a sta- 312(a) (7) and 315 respectively of the Communi- tion's DTV service area in one or more directions cations Act, DBS licensees must also grant candi- beyond the area resulting from the station's allot- dates for federal office reasonable access to broad- ment parameters must meet several provisions. cast stations and equal opportunity at the lowest Such requests must include an interference analy- unit charge. sis that demonstrates compliance with the de minimis interference standard set forth in 47 C.F.R. § 73.623(c) (2). The analysis must be per- FCC DOCKET No. 98-303; MM DOCKET No. formed assuming that all other DTV facilities are 97-247: In re Fees for Ancillary or Supplementary operating at the DTV power levels specified for Use of Digital Television Spectrum Pursuant to their allotment or 200 kW, whichever is greater. Section 336(e) (1) of the Telecommunications Act The analysis must further assume that all other of 1996, Report and Order, Nov. 19, 1998. DTV facilities are operating at the allotted site Pursuant to the requirement in the Telecom- and antenna height above average terrain. munications Act of 1996 that it establish a pro- Second, the Commission announced that in a gram to assess and collect fees from broadcast subsequent Public Notice, the Mass Media Bureau licensees for "ancillary and supplementary" uses will announce a window of time during which pe- of the digital television (DTV) spectrum, the titions to amend the NTSC Table of Allotments or Commission adopted rules requiring broadcasters amendments to freeze-waiver applications may be to pay a fee of 5% of gross revenues received from filed. Parties that had filed applications for new ancillary or supplementary uses of the DTV spec- NTSC stations using allotments in the freeze areas trum for which they charge fees or receive other will be permitted to amend their applications if specified compensation. The Commission an- such amendment would, using the criteria set nounced that it will assess fees on all revenue, in- forth in 47 C.F.R. § 73.623(c), eliminate interfer- cluding subscription and advertising revenue, on ence to DTV service. Such amendments must covered services for which viewers must pay sub- conform to pertinent NTSC requirements. An ap- scription fees and that the fee program would go plication amendment may specify DTV operation. into effect immediately. Beginning in 1999, the Commission will require licensees to pay the fee on December 1 each year for covered revenues re- WIRELESS ceived during the twelve-month period ending September 30. Broadcasters are also required to WT DOCKET No. 96-198: In re Implementa- file an annual report on December 1 providing tion of Section 255 of the Telecommunications data that will allow the Commission, as mandated Act of 1996, Notice of Proposed Rulemaking, Apr. 2, by statute, to report to Congress and consider ad- 1998. justments in the fee level. The Commission indi- The FCC adopted a Notice of Proposed cated that it intended to review the fee assessment Rulemaking ("NPRM") to implement Section 255 program by the time of its report to Congress on of the Telecommunications Act of 1996 ("the the program, which is mandated by the 1996 Act Act"). Section 255 represents the most significant to be completed by 2001. governmental action for people with disabilities since the passage of the Americans with Disabili- MM DOCKET No. 87-268: In re Advanced Tel- ties Act of 1990 ("ADA"). In Section 255, Con- evision Systems and Their Impact Upon the Ex- gress set forth a broad mandate that telecommu- isting Television Broadcast Service, Second Memo- nications service providers and equipment COMMLAW CONSPECTUS [Vol. 7 manufacturers must make their services and subscribers during 1997. The Third report also equipment accessible to people with disabilities, observes that the paging and messaging industry to the extent that it is readily achievable to do so. is highly competitive and that new and innovative Under the NPRM, companies will be provided products are being offered. Finally, the report with flexibility concerning how they carry out the noted that the dispatch industry has seen a mandate. Nevertheless, carriers are responsible greater range of mobile messaging, mobile data for ensuring that their products are accessible to and vehicle location services made possible by the persons with the full range of disabilities recog- deployment of digital technology. nized under the ADA, to the extent that they is "readily achievable" to do so. However, the Com- FCC DOCKET No. 98-234; WT DOCKET Nos. mission did not propose to prescribe detailed im- 98-20, 96-188: In re Amendment of Parts 21 and plementation rules that companies must follow. 74 to Enable Multipoint Distribution Service and Companies would assess whether it is readily Instructional Television Service to Engage in achievable to make their products accessible to Fixed Two-Way Transmissions, Sept. 17, 1998. the full range of disabilities, and if not, why not. The Commission adopted rules consolidating, The Commission proposed to adopt the ADA revising and streamlining its license application definition of readily achievable, which is "easily procedures. Specifically, the Report and Order accomplishable and able to be carried out without adopts rule changes that will implement the Uni- much difficulty or expense." The Commission versal Licensing System ("ULS"). ULS is the inte- also proposed to analyze whether a particular tele- grated database and automated processing system communications accessibility feature is "readily developed by the Wireless Bureau to facilitate achievable" based on feasibility, expense, and electronic filing of wireless applications, licensing practicality. information and public access to such informa- The NPRM proposed adoption of a "fast track" tion for all wireless radio services. The rulemak- process for Section 255 complaints. The Commis- ing also represents the first Report and Order of sion believed that the fast-track approach would the Commission's 1998 biennial review of regula- resolve many accessibility problems informally, tions pursuant to Section 11 of the Communica- providing consumers rapid relief and enabling tions Act. manufacturers and service providers to apply The Commission took various specific actions their resources to solving access problems rather including the following: (1) adopting, consolidat- than subjecting them to burdensome procedural ing and requiring various new application forms requirements. and procedures for wireless service; (2) assuring that electronic filing and data programs are acces- sible to persons with disabilities; (3) consolidating FCC DOCKET No. 98-91; REPORT No. WT rules regarding the determination of whether a 98-13: Third Annual Report to Congress On State of change to a pending application or existing au- CMPRS Competition, May 14, 1998. thorization is treated as a major or a minor The Commission adopted its Third Annual change; (4) adopting requirements for the sub- Commercial Mobile Radio Service Competition mission of Taxpayer Identification Numbers ("CMRS") Report ("Third Report"). The Third ("TIMs") in ULS consistent with the Debt Collec- Report evaluates various CMRS product catego- tion Act of 1996; (5) adopting proposals to au- ries and concludes that progress has been made thorize reciprocal operation by foreign amateur toward competition over the past year. The Third radio licensees by rule, pursuant to international Report considers three categories of CMRS prod- reciprocal operating agreements; and (6) identify- ucts: mobile telephony, paging/messaging and ing numerous General Mobile Radio Service dispatch. The Third Report describes the in- (GMRS) rules to be eliminated and streamlined crease in the mobile telephony market subscriber- as duplicative or unnecessary to its regulatory re- ship, which has reached 55 million, representing sponsibilities. 20 percent of the nation's population subscribing to service and an increase of over 11 million new