Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | * | ET Docket No. 04-295         |
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> **NOTICE OF PROPOSED RULEMAKING AND DECLARATORY RULING**
>
> **Adopted: August 4, 2004 Released: August 9, 2004**
>
> **Comment Date: \[45 days from publication in the Federal Register\]**
>
> **Reply Comment Date: \[75 days from publication in the Federal
> Register\]**
>
> By the Commission: Chairman Powell and Commissioner Abernathy issuing
> separate statements; Commissioners Copps and Adelstein concurring and
> issuing separate statements.

Table of Contents

**Paragraph \#**

**I. INTRODUCTION 1**

**II. BACKGROUND 5**

**III. DISCUSSION 30**

**A. INTRODUCTION 30**

**B. APPLICABILITY OF CALEA TO BROADBAND INTERNET ACCESS AND**

**VOIP SERVICES 37**

**C. Requirements and Solutions 62**

**D. CALEA COMPLIANCE EXTENSION PETITIONS 87**

**E. eNFORCEMENT OF CALEA 111**

**F. COST AND COST RECOVERY ISSUES 117**

**G. effective DATE oF NEW rulES 140**

**IV. DECLARATORY RULING ON PUSH-TO-TALK SERVICES 144**

**V. PROCEDURAL MATTERS 152**

**A. INITIAL REGULATORY FLEXIBILITY ANALYSIS 152**

**B. PAPERWORK REDUCTION ACT 153**

**C. *EX PARTE* RULES 154**

**D. COMMENTS 155**

**E. CONTACT PERSONS 158**

**VI. ORDERING CLAUSES 159**

**APPENDIX A: COMMENTERS TO THE LAW ENFORCEMENT PETITION**

**APPENDIX B: INITIAL REGULATORY FLEXIBILITY ANALYSIS**

**APPENDIX C: TRUSTED THIRD PARTY MODELS**

**Appendix D: Standards for packet-mode technologies**

**APPENDIX E: INFORMATION REQUIRED WITH SECTION 107(C) AND SECTION
109(B) CIRCUIT PETITIONS**

**APPENDIX F: INFORMATION REQUIRED WITH SECTION 107(C) AND SECTION
109(B) PACKET PETITIONS**

I.  **INTRODUCTION**

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1.  Through this proceeding, we launch a thorough examination of the
    appropriate legal and policy framework of the Communications
    Assistance for Law Enforcement Act ("CALEA"). We initiate this
    proceeding at the request of, and in response to, a joint petition
    filed by the Department of Justice ("DoJ"), Federal Bureau of
    Investigation ("FBI"), and the Drug Enforcement Administration
    ("DEA") (collectively, "Law Enforcement").[^1] In the *Notice of
    Proposed Rulemaking ("Notice")*, we examine issues relating to the
    scope of CALEA's applicability to packet-mode services, such as
    broadband Internet access, and implementation and enforcement
    issues. We tentatively conclude that: (1) Congress intended the
    scope of CALEA's definition of "telecommunications carrier" to be
    more inclusive than that of the Communications Act; (2)
    facilities-based providers of any type of broadband Internet access
    service, whether provided on a wholesale or retail basis, are
    subject to CALEA; (3) "managed" Voice over Internet Protocol
    ("VoIP") services are subject to CALEA; (4) the phrase in section
    102 of CALEA "a replacement for a substantial portion of the local
    telephone exchange service" calls for assessing the replacement of
    any portion of an individual subscriber's functionality previously
    provided via "plain old telephone service" ("POTS"); and (5)
    call-identifying information in packet networks is "reasonably
    available" under section 103 of CALEA if the information is
    accessible without "significantly modifying a network." We seek
    comment on: (1) the feasibility of carriers relying on a trusted
    third party to manage their CALEA obligations and to provide to law
    enforcement agencies ("LEAs") the electronic surveillance
    information they require in an acceptable format; and (2) whether
    standards for packet technologies are deficient and should not serve
    as safe harbors for complying with section 103 capability
    requirements.

2.  We also propose mechanisms to ensure that telecommunications
    carriers comply with CALEA. Specifically, we propose to restrict the
    availability of compliance extensions under CALEA section 107(c) and
    clarify the role and scope of CALEA section 109, which addresses the
    payment of costs of carriers to comply with the section 103
    capability requirements. Additionally, we consider whether, in
    addition to the enforcement remedies through the courts available to
    LEAs under CALEA section 108, we may take separate enforcement
    action against carriers that fail to comply with CALEA. We
    tentatively conclude that carriers are responsible for CALEA
    development and implementation costs for post-January 1, 1995
    equipment and facilities; seek comment on cost recovery issues for
    wireline, wireless and other carriers; and refer to the
    Federal-State Separations Joint Board cost recovery issues for
    carriers subject to Title II of the Communications Act. In the
    companion *Declaratory Ruling*, we clarify that commercial wireless
    "push-to-talk" services continue to be subject to CALEA, regardless
    of the technologies that Commercial Mobile Radio Service ("CMRS")
    providers choose to apply in offering them.

3.  Since 1970, telecommunications carriers have been required to
    cooperate with LEAs to assist their conduct of electronic
    surveillance.[^2] Advances in technology, however, most notably the
    introduction of digital transmission and processing techniques and
    the proliferation of wireless and Internet services, such as
    broadband access services, have challenged the ability of LEAs to
    conduct lawful surveillance. CALEA, enacted in October 1994, was
    intended to preserve the ability of LEAs to conduct electronic
    surveillance by requiring that telecommunications carriers and
    manufacturers of such equipment modify and design their equipment,
    facilities, and services to ensure that they have the required
    surveillance capabilities.[^3]

4.  In this proceeding we are guided by the following principles and
    policy goals.[^4] First, it is the Commission's primary policy goal
    to ensure that LEAs have all of the resources that CALEA authorizes
    to combat crime and support Homeland Security. Second, the
    Commission recognizes that Law Enforcement's needs must be balanced
    with the competing policies of avoiding impeding the development of
    new communications services and technologies and protecting customer
    privacy. Section 103 of CALEA explicitly precludes LEAs from
    prohibiting the adoption of any equipment, facility, service, or
    feature by any telecommunications provider, manufacturer, or support
    service; and also protects the privacy and security of
    communications and call-identifying information not authorized to be
    intercepted. Third, the Commission intends to remove to the extent
    possible any uncertainty that is impeding CALEA compliance,
    particularly for packet-mode technology.

> **II. BACKGROUND**

5.  Jurisdiction to implement CALEA's provisions is shared by the
    Attorney General of the United States, who consults with state and
    local LEAs, and the Federal Communications Commission. Effective
    implementation of CALEA's provisions relies to a large extent on
    shared responsibility among these governmental agencies and the
    service providers and manufacturers subject to the law's
    requirements.

6.  The various statutory provisions of CALEA are focused on the
    following topics: assistance capability to LEAs, system capacity for
    simultaneous wiretaps, implementation and enforcement. We provide
    below an overview of CALEA's statutory provisions as well as the
    regulatory actions taken by the Attorney General, acting through DoJ
    and the FBI, and the Commission to implement certain statutory
    provisions. We also describe the Petition recently filed by Law
    Enforcement, which focuses on a broad range of issues. Accordingly,
    the remainder of this section includes a substantial amount of
    background material essential to the understanding of our subsequent
    proposals.

7.  *Assistance Capabilities.* CALEA requires telecommunications
    carriers and manufacturers of such equipment to meet certain
    assistance capability requirements in support of electronic
    surveillance. "Telecommunications carrier," which is defined in
    subsection 102(8)(A)-(C),[^5] is "a person or entity engaged in the
    transmission or switching of wire or electronic communications as a
    common carrier for hire." Telecommunications carriers include
    commercial mobile service providers[^6] or "a person or entity
    engaged in providing wire or electronic communication switching or
    transmission service to the extent that the Commission finds that
    such service is a replacement for a substantial portion of the local
    telephone exchange service and that it is in the public interest to
    deem such a person or entity to be a telecommunications carrier for
    purposes of this title."[^7]

8.  In the *Second Report and Order* ("*Second R&O*") in CC Docket No.
    97-213, the Commission concluded that the language and legislative
    history of CALEA provide sufficient guidance as to what the term
    \"telecommunications carrier\" means, such that it can be applied to
    particular carriers, their offerings and facilities.[^8] The *Second
    R&O* also stated that resellers, as telecommunications carriers
    under the terms of section 102, are generally subject to CALEA --
    however, resellers are not responsible for the CALEA compliance
    responsibilities of a carrier whose services they are reselling with
    respect to that carrier's underlying facilities.[^9] The *Second
    R&O* further stated that CALEA does not apply to certain entities
    and services, *e.g.* information services and private network
    services.[^10] Additionally, the *Second R&O* stated that CALEA\'s
    definitions of "telecommunications carrier" and "information
    services" were not modified by the Telecommunications Act of 1996,
    and that the CALEA definitions therefore remain in force. The
    *Second R&O* concluded as a matter of law that the entities and
    services subject to CALEA must be based on the CALEA definitions,
    independently of their classification for the separate purposes of
    the Communications Act.[^11]

9.  Section 103 of CALEA establishes four general \"assistance
    capability requirements\" that telecommunications carriers must meet
    to achieve compliance with CALEA.[^12] Subsection 103(a) requires,
    in pertinent part, that a telecommunications carrier shall ensure
    that its equipment, facilities, or services that provide a customer
    or subscriber with the ability to originate, terminate, or direct
    communications are capable of:

\(1\) expeditiously isolating and enabling the government, pursuant to a
court order or other lawful authorization, to intercept, to the
exclusion of any other communications, all wire and electronic
communications carried by the carrier within a service area to or from
equipment, facilities, or services of a subscriber of such carrier
concurrently with their transmission to or from the subscriber\'s
equipment, facility, or service, or at such later time as may be
acceptable to the government;

2\) expeditiously isolating and enabling the government, pursuant to a
court order or other lawful authorization, to access call-identifying
information that is reasonably available[^13] to the carrier (a) before,
during, or immediately after the transmission of a wire or electronic
communication (or at such later time as may be acceptable to the
government) and (b) in a manner that allows it to be associated with the
communication to which it pertains;

\(3\) delivering intercepted communications and call-identifying
information to the government, pursuant to a court order or other lawful
authorization, in a format such that they may be transmitted by means of
equipment, facilities, or services procured by the government to a
location other than the premises of the carrier; and

\(4\) facilitating authorized communications interceptions and access to
call-identifying information unobtrusively and with a minimum of
interference with any subscriber\'s telecommunications service and in a
manner that protects (a) the privacy and security of communications and
call-identifying information not authorized to be intercepted and (b)
information regarding the government\'s interception of communications
and access to call-identifying information.[^14]

10. There are certain limitations on the assistance capability
    requirements in section 103(a). For example, they do not apply to
    information services or equipment, facilities or services that
    support the transport or switching of communications for private
    networks or for the sole purpose of interconnecting
    telecommunications carriers.[^15] Further, CALEA does not authorize
    a LEA to require any specific design of equipment, facilities,
    services, features or system configurations to be adopted by a
    provider of communication service, manufacturer of
    telecommunications equipment, or provider of telecommunications
    support services, nor to prohibit such entities from adopting any
    equipment, facility, service or feature.[^16] Finally, a
    telecommunications carrier is not responsible for decrypting, or
    ensuring a LEAs ability to decrypt, any communication encrypted by a
    subscriber or customer, unless the encryption was provided by the
    carrier and the carrier has the information necessary to decrypt the
    communication.[^17]

11. Achieving compliance with the assistance capability requirements in
    section 103 can be accomplished in various ways, and
    telecommunications carriers and manufacturers share responsibility
    in this regard. Subsection 106(a) states that a carrier is required
    to consult with manufacturers of its transmission and switching
    equipment and its providers of support services for the purpose of
    ensuring that current and planned equipment, facilities, and
    services comply with the capability requirements of section 103 and
    the capacity requirements identified by the Attorney General under
    section 104.[^18] Subsection 106(b) states that manufacturers and
    providers of support services are required, on a reasonably timely
    basis and at a reasonable charge, to make available to carriers that
    use their equipment, facilities, or services such features or
    modifications as are necessary to permit such carriers to comply
    with the capability requirements of section 103 and the capacity
    requirements identified by the Attorney General under section
    104.[^19]

12. Individual carriers are free to choose any technical solution that
    meets the assistance capability requirements of CALEA, whether based
    on an industry standard or not. Carriers, therefore, have some
    degree of flexibility in deciding how they will comply with the
    section 103 requirements.[^20] Subsection 107(a)(2) of CALEA
    contains a \"safe harbor\" provision, stating that \"\[a\]
    telecommunications carrier shall be found to be in compliance with
    the assistance capability requirements under section 103, and a
    manufacturer of telecommunications transmission or switching
    equipment or a provider of telecommunications support services shall
    be found to be in compliance with section 106, if the carrier,
    manufacturer, or support service provider is in compliance with
    publicly available technical requirements or standards adopted by an
    industry association or standard-setting organization, or by the
    Commission under subsection (b), to meet the requirements of section
    103.\"[^21] Subsection 107(b) authorizes the Commission, upon
    petition, to establish rules, technical requirements or standards
    necessary for implementing section 103 if industry associations or
    standard-setting organizations fail to issue technical requirements
    or standards or if a Government agency or any other person believes
    that such requirements or standards are deficient.[^22]

13. Following CALEA's enactment, Subcommittee TR45.2 of the
    Telecommunications Industry Association ("TIA") developed an interim
    standard, J-STD-025 ("J-Standard") to serve as the safe harbor for
    wireline, cellular, and broadband Personal Communications Services
    ("PCS") carriers and manufacturers under subsection 107(a)(2). The
    J-Standard defines services and features required by these carriers
    to support lawfully authorized electronic surveillance, and
    specifies interfaces necessary to deliver intercepted communications
    and call-identifying information to LEAs.[^23] Several parties filed
    petitions for rulemaking with the Commission, pursuant to subsection
    107(b), contending that the J-Standard was either overinclusive or
    underinclusive.

14. In an August 1999 *Third Report and Order (Third R&O*) in CC Docket
    No. 97-213, the Commission required that wireline, cellular, and
    broadband PCS carriers implement all electronic surveillance
    capabilities of the J-Standard, including two contested features of
    that standard -- a packet-mode communications capability[^24] and a
    location information capability[^25] -- and six of nine additional
    capabilities requested by DoJ/FBI, known as the "punch list."[^26]
    The Commission required that all uncontested capabilities covered by
    the J-Standard, as well as the contested location information
    capability, be implemented by June 30, 2000,[^27] and further
    required that the contested packet-mode communications capability
    and the six punch list capabilities be implemented by September 30,
    2001.[^28] Subsequently, the Commission granted an extension of the
    packet-mode compliance deadline until November 19, 2001, and
    temporarily suspended the punch list compliance deadline.[^29]

15. The United States Telecom Association and others petitioned the
    United States Court of Appeals for the District of Columbia Circuit
    ("Court") for review of the *Third R&O*. Petitioners challenged the
    legality of the packet-mode capability requirement, the location
    information requirement, and four of the six punch list
    requirements.[^30] In its August 2000 *Remand Decision*, the Court
    affirmed the Commission's findings in the *Third R&O* in part and
    vacated and remanded in part for further proceedings.[^31] In an
    April 2002 *Order on Remand*, the Commission responded to the
    Court's decision and found that all four vacated punch list
    capabilities are authorized by CALEA and must be provided by
    wireline, cellular, and broadband PCS carriers by June 30, 2002. The
    Commission also required that the two additional punch list
    capabilities that were mandated by the *Third R&O* but not reviewed
    by the Court be provided by that same date.[^32] The *Order on
    Remand* was not appealed.

16. *Capacity.* Section 104 of CALEA sets forth notices of maximum and
    actual capacity requirements to accommodate all electronic
    surveillance events that telecommunications carriers may need to
    conduct for LEAs.[^33] Subsection 104(b) requires that
    telecommunications carriers ensure that they were capable of
    accommodating simultaneously the actual number of interceptions, pen
    registers, and trap and trace devices estimated by the Attorney
    General, as well as expanding to the estimated maximum capacity
    required thereafter.[^34] The FBI adopted a *Final Notice of
    Capacity*[^35] in 1998, which describes LEAs' capacity requirements
    for local exchange carriers ("LECs"), cellular carriers, and
    broadband PCS carriers. These carriers were required to comply by
    March 12, 2001. In 2002, the United States Court of Appeals for the
    District of Columbia Circuit remanded for further explanation two
    issues from the *Final Notice of Capacity*.[^36] The FBI recently
    published the explanation in the Federal Register.[^37] In 1998, the
    FBI published a *Notice of Inquiry* seeking comment on capacity
    requirements for other service, such as paging, mobile satellite
    services, specialized mobile radio, and enhanced specialized mobile
    radio.[^38] It published a *Further Notice of Inquiry* in 2000 on
    various issues related to establishing a notice of capacity for
    these additional services.[^39] Further action on these matters is
    pending.

17. *Implementation.* CALEA contains several provisions concerning
    extensions of compliance dates, reimbursement of costs by the
    Attorney General, and system security and integrity requirements for
    and cost recovery by common carriers. Section 107(c) sets forth
    procedures to extend the date to comply with the assistance
    capability requirements in section 103, which was established as
    four years from the date of CALEA's enactment.[^40] A
    telecommunications carrier proposing to install or deploy, or having
    installed or deployed, any equipment, facility, or service prior to
    the effective date of section 103 may petition the Commission for
    one or more extensions of the deadline for complying with the
    assistance capability requirements under section 103. The Commission
    may, after consultation with the Attorney General, grant an
    extension for no longer than two years, if the Commission determines
    that compliance with the assistance capability requirements under
    section 103 is not reasonably achievable through application of
    technology available within the compliance period.[^41]

18. The Commission has issued several *Public Notices* describing
    procedures for telecommunications carriers that may need to file
    petitions for extension of the compliance deadline of the assistance
    capability requirements of section 103 of CALEA. Prior to issuing
    the *Order on Remand*, the Commission in April 2000 issued a *Public
    Notice* with instructions linked to the FBI's Flexible Deployment
    Program under which the FBI reviews extension requests in light of
    the electronic surveillance priorities of LEAs.[^42] In September
    2001, the Commission's Common Carrier (now Wireline Competition) and
    Wireless Telecommunications Bureaus issued a *Public Notice* that
    established procedures for carriers to submit or supplement CALEA
    subsection 107(c) petitions, both generally and with respect to
    packet-mode and other safe harbor standards.[^43] Finally, in
    November 2003, the Commission's Wireline Competition and Wireless
    Telecommunications Bureaus issued a *Public Notice* pertaining to
    pending packet-mode extension petitions.[^44]

19. Section 109 of CALEA addresses the payment of costs by the Attorney
    General to telecommunications carriers who comply with the
    capability requirements of section 103. The statute distinguishes
    between equipment, facilities and services installed or deployed on
    or before January 1, 1995, and after that date. Subsection 109(a)
    states that the Attorney General may, subject to the availability of
    appropriations,[^45] agree to pay telecommunications carriers for
    all reasonable costs directly associated with the modifications
    performed by carriers in connection with equipment, facilities, and
    services installed or deployed on or before January 1, 1995, to
    establish the capabilities necessary to comply with section
    103.[^46] Subsection 109(d) states that, if a carrier has requested
    payment in accordance with procedures promulgated pursuant to
    subsection 109(e) and the Attorney General has not agreed to pay
    that carrier for all reasonable costs directly associated with
    modifications necessary to bring any equipment, facility, or service
    deployed on or before January 1, 1995 into compliance with the
    assistance capability requirements of section 103, such equipment,
    facility, or service shall be considered to be in compliance with
    the capability requirements until the equipment, facility, or
    service is replaced or significantly upgraded or otherwise undergoes
    major modification.[^47] The FBI issued in 1998 a *Notice of
    Proposed Rulemaking*[^48] proposing definitions for "significant
    upgrade or major modification" and a *Supplemental Notice of
    Proposed Rulemaking*[^49] in 2001 regarding definitions of
    "replaced" and "significantly upgraded or otherwise undergoes major
    modification." Action in these rulemakings is pending. In addition,
    the FBI entered into nationwide right-to-use ("RTU") license
    agreements with a number of manufacturers for high priority
    switching platforms. The Federal Government paid some manufacturers
    to develop software solutions that carriers receive at a nominal
    charge.[^50] Overall, these RTUs have made software available for
    the vast majority of Law Enforcement's priority pre-January 1, 1995
    switches.

20. Subsection 109(b)(1) states that, with regard to equipment,
    facilities, and services deployed after January 1, 1995, the
    Commission, on petition from a telecommunications carrier or any
    other interested person, and after notice to the Attorney General,
    must determine whether compliance with the assistance capability
    requirements of section 103 is reasonably achievable with respect to
    any equipment, facility, or service deployed after January 1, 1995.
    The Commission is required to make this determination within one
    year after a petition is filed. In making its determination, the
    Commission is required to evaluate whether compliance would impose
    significant difficulty or expense on the carrier or on the users of
    the carrier\'s systems and must consider eleven factors.[^51]

21. Subsection 109(b)(2) states that, if compliance with the assistance
    capability requirements of section 103 is not reasonably achievable
    with respect to any equipment, facility, or service deployed after
    January 1, 1995, the Attorney General, on application of a
    telecommunication carrier, may agree, subject to the availability of
    appropriations, to pay that carrier for the additional reasonable
    costs of making compliance with the capability requirements
    reasonably achievable. If the Attorney General does not agree to pay
    such costs, that carrier shall be deemed to be in compliance with
    the capability requirements.[^52] The FBI published in 1997 the
    *Cost Recovery Regulations* for payment of costs for assistance
    capability and capacity requirements.[^53]

22. CALEA modified the Communications Act by adding new section 229
    concerning CALEA compliance, particularly regarding system security
    and integrity and cost recovery, which provides in subsection 229(a)
    that the Commission shall prescribe such rules as are necessary to
    implement the requirements of CALEA.[^54] The basic requirement for
    system security and integrity is contained in section 105 that
    requires a telecommunications carrier to ensure that any
    interception of communications or access to call-identifying
    information within its switching premises can be activated only in
    accordance with a court order or other lawful authorization and with
    the affirmative intervention of an individual officer or employee of
    the carrier acting in accordance with regulations prescribed by the
    Commission.[^55] The Commission established these systems and
    security and integrity regulations in March 1999, and carriers'
    policies and procedures are on file with the Commission.[^56]

23. Cost recovery for CALEA compliance by common carriers is addressed
    by subsection 229(e)(1), which states a common carrier may petition
    the Commission to adjust charges, practices, classifications, and
    regulations to recover costs expended for making modifications to
    equipment, facilities, or services pursuant to the requirements of
    section 103 of CALEA.[^57] Subsection 229(e)(2) states that the
    Commission may grant, with or without modification, a petition under
    subsection 229(e)(1) if the Commission determines that such costs
    are reasonable and that permitting recovery is consistent with the
    public interest.[^58]

24. *Enforcement.* Section 108 of CALEA deals with enforcement orders.
    Subsection 108(a) states that a court is permitted to issue an
    enforcement order to a carrier only if the court finds that --

    \(1\) alternative technologies or capabilities or the facilities of
    another carrier are not reasonably available to law enforcement for
    implementing the interception of communications or access to
    call-identifying information; and

> \(2\) compliance is reasonably achievable through the application of
> available technology to the equipment, facility, or service at issue
> or would have been reasonably achievable if timely action had been
> taken.[^59]

25. *Law Enforcement Petition*. In March 2004, Law Enforcement filed its
    Petition requesting that the Commission initiate a new rulemaking
    proceeding to resolve, on an expedited basis, various outstanding
    issues associated with the implementation of CALEA. In its Petition,
    Law Enforcement states, that although the Commission has taken steps
    to implement CALEA, there remain several outstanding issues. In
    order to resolve these issues, Law Enforcement asks the Commission
    to:

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(1) formally identify the types of services and entities that are
    subject to CALEA;

(2) formally identify the services that are considered "packet-mode
    services;"

(3) initially issue a Declaratory Ruling or other formal Commission
    statement, and ultimately adopt final rules, finding that broadband
    access services and broadband telephony services are subject to
    CALEA;

(4) reaffirm, consistent with the Commission's finding in the *Second
    R&O*, that push-to-talk "dispatch" service is subject to CALEA;

(5) adopt rules that provide for the easy and rapid identification of
    future CALEA-covered services and entities;

(6) establish benchmarks and deadlines for CALEA packet-mode compliance;

(7) adopt rules that provide for the establishment of benchmarks and
    deadlines for CALEA compliance with future CALEA-covered
    technologies;

(8) outline the criteria for extensions of any benchmarks and deadlines
    for compliance with future CALEA-covered technologies established by
    the Commission;

(9) establish rules to permit the Commission to request information
    regarding CALEA compliance generally;

> \(10\) establish procedures for enforcement actions by the Commission
> against entities that do not comply with their CALEA obligations;
>
> \(11\) confirm that carriers bear sole financial responsibility for
> CALEA implementation costs for post-January 1, 1995 communications
> equipment, facilities and services;
>
> \(12\) permit carriers to recover their CALEA implementation costs
> from their customers; and

(13) clarify the cost methodology and financial responsibility
     associated with intercept provisioning.[^60]

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26. In its Petition, Law Enforcement contends that outstanding
    implementation issues require immediate attention and resolution by
    the Commission, so that industry and LEAs have clear guidance on
    CALEA as the implementation process moves forward. Law Enforcement
    further contends that initiating a rulemaking proceeding is
    consistent with the Commission's ongoing obligations under section
    229(a) of the Communications Act to prescribe rules as necessary to
    implement CALEA.[^61] Law Enforcement argues that developments since
    the *Second R&O* make it imperative for the Commission to revisit
    which services and entities are subject to CALEA. Specifically, Law
    Enforcement argues that the Commission and the District of Columbia
    Circuit Court have made clear that CALEA is applicable not only to
    entities and services that employ traditional circuit-mode
    technology, but also to entities and services that employ
    packet-mode technology; *i.e.*, technology in which the transmission
    or messages are divided into packets before they are sent,
    transmitted individually, and recompiled into the original message
    once all of the packets arrive at their destination. However, Law
    Enforcement maintains, the Commission has not yet made clear the
    specific types of packet-mode services that come within the scope of
    CALEA. Accordingly, Law Enforcement asks the Commission to reaffirm
    that packet-mode communications services are subject to CALEA and,
    having done so, to establish rules that formally identify the
    services and entities that are covered by CALEA, so that both LEAs
    and industry are on notice with respect to CALEA obligations and
    compliance.[^62]

27. Law Enforcement maintains that the importance and the urgency of
    this task cannot be overstated because the ability of federal,
    state, and local LEAs to carry out critical electronic surveillance
    is being compromised today by providers who have failed to implement
    CALEA-compliant intercept capabilities. Law Enforcement asserts that
    communications among surveillance targets are being lost, and
    associated call-identifying information is not being provided in the
    timely manner required by CALEA. Law Enforcement further asserts
    that the Commission can resolve any controversy about CALEA's
    applicability to broadband access, broadband telephony, and
    push-to-talk dispatch services separately and independently from its
    proceedings addressing the classification of Internet Protocol
    ("IP")-enabled services under the Communications Act.[^63]

28. LEAs strongly support the Petition,[^64] arguing that CALEA was
    enacted to ensure that they have the ability to conduct electronic
    surveillance as communications technology changes. They contend that
    many providers of services using new technologies, such as broadband
    Internet access, VoIP telephony, and push-to-talk digital dispatch,
    have failed to voluntarily adopt CALEA intercept solutions and that
    LEAs have been thwarted in their attempts to implement lawfully
    authorized electronic surveillance. They also maintain that state
    and local LEAs do not have the financial or personnel resources to
    develop costly *ad hoc* surveillance solutions for each new service
    and that, for all equipment, services, and facilities deployed after
    January 1, 1995, CALEA expressly passed the burden of designing and
    paying for such surveillance solutions onto the telecommunications
    carriers themselves.[^65]

29. Many other parties generally oppose the Petition. Some of these
    parties state that there is no need for the Commission to initiate
    either a rulemaking proceeding or issue a declaratory ruling to
    resolve outstanding issues associated with the implementation of
    CALEA, while others maintain that the Commission must develop a
    complete record on the issues set forth in the Petition prior to
    issuing any declaratory ruling.[^66] Many opposing parties contend
    that the Petition asks the Commission to go beyond its statutory
    authority and make information services, such as broadband
    telephony, subject to CALEA.[^67] Opposing parties also argue that
    grant of the Petition would have a harmful impact on innovation
    because such action would give to Law Enforcement the right to
    pre-approve new technologies and services.[^68] Some opposing
    parties also maintain that there are technical problems inherent in
    translating CALEA's requirements into Internet services.[^69]
    Additionally, opposing parties contend that the Petition's proposed
    enforcement scheme is flawed because it would grant excessive
    regulatory authority to LEAs and to the Commission.[^70] Finally,
    opposing commenters argue that grant of the Petition would impose
    excessive costs on carriers and raise privacy concerns.[^71]

    III\. DISCUSSION

## INTRODUCTION

30. We undertake this proceeding to examine the appropriate legal and
    policy framework of CALEA, particularly with respect to new packet
    mode technologies and services. Our intent is to remove to the
    extent possible any uncertainty that is impeding CALEA compliance.
    We recognize that many parties have spent much time and effort on
    CALEA solutions, often with successful results, but we think that
    the diversity of the comments filed in response to the Petition
    underscores Law Enforcement's argument that progress has been slow
    and uncertainty persists. Furthermore, we are sensitive to the law
    enforcement community's role in Homeland Security and the importance
    of electronic surveillance in fighting crime and terrorism.

31. Although laws other than CALEA provide LEAs with the necessary
    authority to conduct electronic surveillance, carriers subject to
    CALEA provide invaluable assistance for implementing surveillance
    by, for example, providing sufficient capacity on their networks,
    ensuring that a subject's communications are isolated and other
    customers' privacy is protected, and delivering to LEAs intercepted
    communications and related information that is timely and usable.
    However, we recognize that LEAs' needs must be balanced with the
    competing policies of avoiding impeding the development of new
    communications services and technologies and protecting customer
    privacy. We are committed to finding solutions that will allow
    carriers and manufacturers to find innovative ways to meet the needs
    of the law enforcement community without adversely affecting the
    dynamic telecommunications industry. In this regard, we observe that
    packet-mode and various types of broadband technology have become
    increasingly important in recent years and have led to a
    proliferation of new services. In particular, packet-mode technology
    often is used to provide the broadband connection used for accessing
    the Internet.

32. In its Petition, Law Enforcement requests that the Commission issue
    a Declaratory Ruling and ultimately adopt rules finding that CALEA
    applies to two closely related packet-mode services: "broadband
    access service" and "broadband telephony service."[^72] Law
    Enforcement defines "broadband access service" as follows:

...the process and service used to gain access or connect to the public
Internet using a connection based on packet-mode technology that offers
high bandwidth. The term is intended to be inclusive of services that
the Commission has previously defined as 'wireline broadband Internet
access' and 'cable modem service' as well as other services providing
the same function through different technology, such as wireless
technology. The term does not include any 'information services'
available to a user after he or she has been connected to the Internet,
such as the content found on Internet Service Providers' or other
websites. 'Broadband access services' includes the platforms currently
used to achieve broadband connectivity *(e.g*., wireline, cable modem,
wireless, fixed wireless, satellite, and broadband access over power
line) as well as any platforms that may in the future be used to achieve
broadband connectivity.[^73] (Footnotes omitted.)

Law Enforcement defines "broadband telephony service" as the
transmission or switching of voice communications using broadband
facilities.[^74] The Petition describes various business models used for
broadband telephony, which we discuss in more detail below, that it
claims should be covered by CALEA.

33. As Law Enforcement requests, we reaffirm that CALEA is technology
    neutral and thus does encompass services provided using packet-mode
    technology. The Commission has previously noted that CALEA is
    technology neutral and that a carrier's choice of technology does
    not change its obligations under CALEA.[^75] Carriers, manufacturers
    and LEAs have understood that CALEA's obligations would not be
    defeated if a carrier used packet-mode technology, and included in
    standard J-STD-025 some requirements for wireline, wireless and PCS
    carriers that deliver communications using several types of packet
    technologies. Further, the FBI expanded its Flexible Deployment
    Program to cover carriers' implementation of CALEA-compliant
    packet-mode technology, and carriers have filed requests with the
    Commission for extensions of time to bring their packet-mode
    networks into compliance.[^76] We recognize, however, that not all
    packet-mode services or all entities involved in a packet-mode
    transmission may be subject to CALEA. The unique characteristics of
    packet-mode technology have allowed numerous applications to be
    developed, and several different entities may be involved in the
    transmission of a communication. The key question is whether the
    provider of the service is a "telecommunications carrier" subject to
    CALEA.

34. As set forth below, as a matter of policy and based on the record
    developed in response to the Petition, we reach a number of
    tentative conclusions regarding these statutory definitions and
    their application to particular types of services, and seek comment
    on these conclusions.  We decline at this point, however, to enter
    an order establishing that \"broadband access service\" and
    \"broadband telephony service\" -- as those terms are defined by Law
    Enforcement -- are covered by CALEA.  We believe the record in this
    proceeding needs to be more fully developed and weighed before a
    final determination is made. In particular, we seek additional legal
    and technical information regarding how best to apply
    these statutory definitions to specific categories of service and
    facilities.  We do, however, clarify in a *Declaratory Ruling* that
    certain push-to-talk \"dispatch\" services are subject to CALEA.

35. In this *Notice*, we address the types of services and entities
    encompassed by the terms "broadband access service" and "broadband
    telephony service." We rely on Law Enforcement's definitions to a
    large extent in this endeavor. We attempt to identify services and
    processes that provide broadband access to the public Internet,
    focusing primarily on those services and entities using packet-mode
    technology. In this *Notice*, we refer to "broadband access service"
    and "broadband Internet access service" interchangeably. Law
    Enforcement does not define the term "broadband," and thus we will
    rely on previous uses we have made of this term, *i.e*., those
    services having the capability to support upstream or downstream
    speeds in excess of 200 kilobits per second ("kbps") in the last
    mile.[^77] Finally, this *Notice* addresses broadly CALEA compliance
    for any packet-mode application and focuses specifically on voice
    communications. We recognize that although broadband access for
    voice telephony communications could be provided using various
    packet-mode technologies, most packet voice communications in
    commercial use today are provided using the Internet Protocol and
    are commonly referred to as "VoIP."[^78] Thus, we will refer to VoIP
    rather than "broadband telephony service" in this *Notice*.

36. In this *Notice*, we also address several other issues raised by Law
    Enforcement. Law Enforcement urges the Commission to take a more
    active role in CALEA implementation by, for example, establishing
    benchmarks and deadlines for packet-mode compliance and enforcement
    of CALEA requirements. We seek comment on these proposals, as well
    as alternatives, all designed with the goal of moving carriers
    toward full CALEA compliance rapidly. We therefore explore
    alternative methods of achieving the same objective. Finally, LEAs
    are very concerned about the cost of conducting electronic
    surveillance and believe that increased rates for such surveillance
    might hamper their ability to rely on this important investigative
    tool. As the number of electronic surveillances has increased, so
    have the rates carriers charge LEAs. In this *Notice*, we clarify
    and seek comment on various cost and cost recovery issues.

    B. APPLICABILITY OF CALEA TO BROADBAND INTERNET ACCESS AND VOIP
    SERVICES

37. In this section, we tentatively conclude that facilities-based
    providers of any type of broadband Internet access service,[^79]
    whether provided on a wholesale or retail basis,[^80] are subject to
    CALEA because they provide a replacement for a substantial portion
    of the local telephone exchange service used for dial-up Internet
    access service and treating such providers as telecommunications
    carriers for purposes of CALEA is in the public interest.[^81]
    Broadband Internet access providers include, but are not limited to,
    wireline, cable modem, satellite, wireless, and broadband access via
    powerline companies.[^82] We seek comment on this tentative
    conclusion. In addition, we tentatively conclude that providers of
    VoIP services that Law Enforcement characterizes as "managed" or
    "mediated" are subject to CALEA as telecommunications carriers under
    the Substantial Replacement Provision. Law Enforcement describes
    managed or mediated VoIP services as those services that offer voice
    communications calling capability whereby the VoIP provider acts as
    a mediator to manage the communication between its end points and to
    provide call set up, connection, termination, and party
    identification features, often generating or modifying dialing,
    signaling, switching, addressing or routing functions for the
    user.[^83] Law Enforcement distinguishes managed communications from
    "non-managed" or "peer-to-peer" communications, which involve
    disintermediated communications that are set up and managed by the
    end user via its customer premises equipment or personal computer.
    In these non-managed, or disintermediated, communications, the VoIP
    provider has minimal or no involvement in the flow of packets during
    the communication, serving instead primarily as a directory that
    provides users' Internet web addresses to facilitate peer-to-peer
    communications.[^84] We request comment on the appropriateness of
    this distinction between managed and non-managed VoIP communications
    for purposes of CALEA.

38. Law Enforcement asserts that CALEA applies to broadband Internet
    access service and mediated VoIP services and that application is
    critical to its efforts to combat crime and terrorism.[^85] We base
    our tentative conclusion that those services are subject to CALEA on
    an analysis of the statute and its legislative history -- which
    demonstrate that the meaning of "telecommunications carrier" in
    CALEA is broader than its meaning under the Communications Act --
    and on Congress\'s stated intent "to preserve the government's
    ability, pursuant to court order or other lawful authorization, to
    intercept communications involving advanced technologies such as
    digital or wireless transmission modes."[^86]

39. In classifying broadband Internet access and other packet-based
    services, we wish to identify and clarify areas that are outside the
    scope of this section. First, we do not disturb the Commission's
    prior decisions that CALEA unambiguously applies to all "common
    carriers offering telecommunications services for sale to the
    public" as so classified under the Communications Act.[^87] These
    common carriers are subject to CALEA regardless of the technology
    they deploy to offer their services, including packet-based
    technology.[^88] Thus, we are not inviting comment on the
    applicability of CALEA to these providers and advise parties that we
    will hold such comment to be outside the scope of this proceeding.
    Furthermore, this inquiry in no way relates to the obligations of
    any entity, whether or not it is subject to CALEA, to respond to
    lawful instruments seeking information or cooperation with LEAs.
    These obligations attach under separate provisions of federal or
    state law and are not impacted by our inquiry here.[^89] Finally, we
    point out that the question of what additional entities and services
    are covered by CALEA's definitions is separate from the question of
    whether these entities can provide all the capabilities listed in
    section 103.[^90] Questions regarding capabilities, and the extent
    to which entities subject to CALEA are able to achieve these
    capabilities, are posed in a separate section of this *Notice*.[^91]

###  1. Analysis of CALEA's Statutory Definitions  {#analysis-of-caleas-statutory-definitions .unnumbered}

#### a. "Telecommunications Carriers" under CALEA {#a.-telecommunications-carriers-under-calea .unnumbered}

40. CALEA requires "telecommunications carriers" to ensure that their
    equipment, facilities, and services are capable of providing
    surveillance capabilities to LEAs.[^92] As noted above, CALEA
    contains its own unique definition of \"telecommunications
    carrier.\"[^93] For purposes of CALEA, a \"telecommunications
    carrier\" is \"a person or entity engaged in the transmission or
    switching of wire or electronic communications as a common carrier
    for hire,\" but also includes entities that provide \"a replacement
    for a substantial portion of the local telephone exchange service\"
    (we refer to this latter clause as the \"Substantial Replacement
    Provision\") if the Commission deems those entities to be
    \"telecommunications carriers\" as well.[^94]

41. We tentatively conclude that Congress intended the scope of CALEA's
    definition of "telecommunications carrier" to be more inclusive than
    that of the Communications Act. We base this tentative conclusion on
    the facial differences in the statutory language discussed
    below.[^95] We acknowledge the Commission's previous statement that
    it expected "in virtually all cases that the definitions of the two
    Acts will produce the same results."[^96] In making that statement,
    however, the Commission foreshadowed the possibility that the
    definitions under each of the two statutes may differ when it also
    concluded that it is "a matter of law that the entities and services
    subject to CALEA *must be based on the CALEA definition* . . .
    independently of their classification for the separate purposes of
    the Communications Act."[^97] We seek comment on our analysis. Below
    we ask parties to address the precise contours of CALEA's definition
    of "telecommunications carrier" -- in particular the meaning of the
    Substantial Replacement Provision.

#####  (i) The Substantial Replacement Provision -- Section 102(8)(B)(ii)  {#i-the-substantial-replacement-provision-section-1028bii .unnumbered}

42. In section 102(8)(B)(ii) --the Substantial Replacement Provision --
    Congress explicitly directs the Commission, after making certain
    findings, to deem the following entities telecommunications carriers
    for CALEA purposes:

    a person or entity engaged in providing wire or electronic
    communication switching or transmission service to the extent that
    the Commission finds that such service is a replacement for a
    substantial portion of the local telephone exchange service and that
    it is in the public interest to deem such a person or entity to be a
    telecommunications carrier for purposes of \[CALEA\].[^98]

In the past, the Commission has never before exercised its section
102(8)(B)(ii) discretion to identify additional entities that fall
within CALEA's definition of "telecommunications carrier."[^99]
Moreover, it has never, until now, solicited comment on the discrete
components of this subsection or on specific classes of entities to
which this subsection might apply.[^100] We therefore seek comment below
on what criteria we should apply to deem an entity a "telecommunications
carrier" under the Substantial Replacement Provision and to which
services CALEA should apply. In identifying services that may be covered
under the Substantial Replacement Provision, we ask commenters to
identify those entities associated with or "engaged in providing" such
services and to what extent those entities have the information LEAs
seek to obtain when conducting electronic surveillance.

43. We address the three articulated components of the Substantial
    Replacement Provision in turn. First, we seek comment on the phrase
    "engaged in providing wire or electronic communication switching or
    transmission service."[^101] Because of Congress\'s stated purpose
    to require compliance with CALEA "with respect to services or
    facilities that provide a customer or subscriber with the ability to
    originate, terminate or direct communication,"[^102] we read the
    phrase \"switching or transmission service\" broadly here.
    Specifically, we interpret "switching" in this section to include
    routers, softswitches,[^103] and other equipment that may provide
    addressing and intelligence functions for packet-based
    communications to manage and direct the communications along to
    their intended destinations. These functions are similar to the
    switching functions in a circuit-switched network and thus we
    believe CALEA's explicit inclusion of the word "switching" is meant
    to include these capabilities. With regard to \"transmission,\" we
    note that CALEA *does not* limit "transmission" in section 102 to
    transmission "without change in the form or content of the
    information as sent or received,"[^104] as does the Communications
    Act.[^105] Thus, we would interpret the "switching or transmission"
    component of the Substantial Replacement Provision to include
    entities that provide the underlying broadband transmission
    capability of Internet access services. We seek comment on this
    analysis and inquire specifically what types of "switching or
    transmission" satisfy this component of the Substantial Replacement
    Provision.

44. Second, we consider the meaning of the phrase "a replacement for a
    substantial portion of the local telephone exchange service." We
    tentatively conclude that the phrase "a replacement for a
    substantial portion of the local telephone exchange service" reaches
    the replacement of any portion of an individual subscriber's
    functionality previously provided via POTS, *e.g.*, the telephony
    portion of dial-up Internet access functionality when replaced by
    broadband Internet access service. We acknowledge that the statutory
    phrase contains some ambiguity,[^106] and are therefore guided by
    the statutory purposes to \"preserve\" LEAs' surveillance
    capabilities in the face of changing technologies[^107] and an
    accelerating adoption of packet-based services in lieu of
    circuit-switched ones.[^108] Keeping in mind Congress\'s intent to
    \"preserve\" surveillance capabilities, we note that at the time
    CALEA was enacted, the local exchange telephone network served two
    distinct purposes. First, it was the means to obtain POTS that
    enabled customers to make voice-grade telephone calls to other
    customers within a defined service area, *i.e.*, the local telephone
    exchange area.[^109] Second, it was (and still is to a large extent)
    the access conduit to many other services such as long distance
    services,[^110] enhanced services,[^111] and the Internet.[^112] To
    the extent that individual subscribers use other platforms or
    technologies to replace particular functionalities of local exchange
    service, we believe these other platforms and technologies
    constitute a local exchange service replacement for purposes of this
    prong of CALEA.[^113] We seek comment on this reading. As mentioned
    above, moreover, CALEA is about incorporating surveillance
    assistance capabilities into the network equipment, facilities or
    services of entities subject to the statute. To the extent that
    costs associated with such capabilities are a factor in compliance
    obligations, waiting until a service provided over a new technology
    is widely deployed on some geographic basis before deeming it
    subject to CALEA under the Substantial Replacement Provision would
    be contrary to sensible policy, for it would be significantly more
    difficult and expensive to retrofit existing facilities with
    CALEA-compliant capabilities than if applicable capability
    requirements were built in at the early development stages with
    certainty that CALEA would apply. Law Enforcement asserts that
    broadband Internet access services and mediated VoIP services
    currently replace a substantial portion of local exchange service so
    as to bring these services within the scope of CALEA under this
    prong of the Substantial Replacement Provision.[^114] Some
    commenters agree and we tentatively adopt that view.[^115] Are there
    other services, such as classes of wireless services that may not
    meet the definition of a "commercial mobile service" under section
    102(8)(B)(i) of CALEA, that may nevertheless satisfy this prong of
    the Substantial Replacement Provision?

45. Finally, we seek comment on the meaning of "public interest" under
    this section of CALEA. The Substantial Replacement Provision
    requires the Commission to find it in the public interest to deem a
    person or entity subject to CALEA under this subsection. CALEA does
    not define "public interest" specifically in the context of the
    Substantial Replacement Provision. We note, however, that the *House
    Report* explicitly lists three factors that the Commission "shall
    consider" in making its public interest determination specifically
    in the context of the Substantial Replacement Provision -- whether
    it would "promote competition, encourage the development of new
    technologies, and protect public safety and national
    security."[^116] We conclude that these three factors, at a minimum,
    should inform our public interest finding. We seek comment on this
    analysis and invite commenters to discuss any other factors that
    should provide the foundation of any public interest determination
    we make under this subsection.

     (ii) Telecommunications Carriers, Generally

46. As stated above, even outside the definition of Substantial
    Replacement Provision, Law Enforcement argues that section
    102(8)(A)\'s definition of \"telecommunications carrier\" departs
    from the Communications Act definitions in several ways that also
    signal Congress's intent that CALEA have a broader reach than the
    Communications Act:[^117]

-   Section 102(8)(A) refers to "a person or entity engaged in the
    transmission or *switching* of wire or electronic communications as
    a common carrier for hire."[^118] The Communications Act definitions
    of "telecommunications,"[^119] "telecommunications service,"[^120]
    and "telecommunications carrier,"[^121] by contrast, refer *only* to
    transmission, not switching.[^122] We discuss above our belief that
    the term \"switching\" in the Substantial Replacement Provision
    covers capabilities of routers and other equipment used in
    packet-based services. Are those provided as a \"common carrier for
    hire\" such that these services could also be covered in section
    102(8)(A)?[^123]

-   The Communications Act definition of "telecommunications" limits
    that term to the transmission "between or among points specified by
    the user, of information of the user's choosing, without change in
    the form or content of the information as sent or received."[^124]
    Section 102(8)(A) contains no such limitation, instead indicating
    that telecommunications carriers are required to comply with CALEA
    with respect to services or facilities "that provide a customer or
    subscriber with the ability to originate, terminate or direct
    communications."[^125]

-   CALEA's reference to "common carrier" in section 102(8)(A) neither
    refers to the Communications Act's definition of common carrier
    (*whereas prior versions of the draft bill did*) nor defines the
    term.[^126]

    These additional definitional differences strengthen our tentative
    conclusion above that CALEA's definition is more inclusive, but we
    ask commenters to what extent we should consider these additional
    definitional differences between CALEA and the Communications Act in
    our analysis.

#### b. Application of Substantial Replacement Provision to Broadband Internet Access and Other Packet-based Services {#b.-application-of-substantial-replacement-provision-to-broadband-internet-access-and-other-packet-based-services .unnumbered}

#########  (i) Broadband Internet Access Services  {#i-broadband-internet-access-services .unnumbered}

47. Law Enforcement seeks a Commission declaration that all forms of
    broadband Internet access are subject to CALEA.[^127] Law
    Enforcement asserts that these services are so clearly subject to
    CALEA that the Commission should issue a ruling declaring so.[^128]
    While we agree with commenters that we must develop a more complete
    record on the substantial factual and legal issues involved before
    we can make final determinations,[^129] we tentatively conclude that
    facilities-based providers of any type of broadband Internet access,
    including but not limited to wireline, cable modem, satellite,
    wireless, and broadband access via the powerline, whether provided
    on a wholesale or retail basis, are subject to CALEA (with possible
    limited exception discussed below),[^130] because they provide
    replacement for a substantial portion of the local telephone
    exchange service used for dial-up Internet access service and such
    treatment is in the public interest.[^131] We base this belief on
    our reading of CALEA and its legislative history as well as the
    record thus far.

48. In reaching this tentative conclusion, we tentatively determine that
    such broadband Internet access service providers satisfy each of the
    three prongs of the Substantial Replacement Provision: broadband
    Internet access includes the switching (routing) and transmission
    functionality; it replaces a substantial portion of the local
    telephone exchange service used for narrowband Internet access; and
    the public interest factors we consider at a minimum, *i.e.*, the
    effect on competition, the development and provision of new
    technologies and services, and public safety and national security,
    weigh in favor of subjecting these broadband Internet access
    services to CALEA.[^132] Specifically, because all facilities-based
    providers of broadband Internet access (except as discussed below)
    would be covered by CALEA, no deterrent effect on competition should
    occur.[^133] Furthermore, many commenters have indicated they are
    currently cooperating with LEAs to provide CALEA-like
    capabilities.[^134] We note that industry has worked with LEAs with
    respect to new services and technologies yet we are not aware of any
    serious adverse impact on the deployment and provision of new
    technologies and services. The overwhelming importance of CALEA
    compliance to law enforcement efforts to safeguard homeland security
    and combat crime weighs heavily in favor of application of CALEA
    obligations to broadband Internet access services. Moreover, we
    believe Congress included the Substantial Replacement Provision to
    specifically empower the Commission to bring services such as
    broadband Internet access within CALEA's reach if appropriate. We
    seek comment on this tentative conclusion.

49. There may exist discrete groups of entities for which the public
    interest may not be served by including them under the Substantial
    Replacement Provision. As discussed above, we will base such
    determination on the three public interest factors, at a minimum, as
    identified above, including: whether it would promote competition,
    encourage the development of new technologies, and protect public
    safety and national security.[^135] For example, entities that
    deploy broadband capability to consumers in underserved areas may
    fall in this category because of the potential deterrent effect it
    could have on deployment in particular circumstances (negatively
    impacting the first and second factors, *i.e.,*protecting
    competition and encouraging the development of new
    technologies).[^136] Small businesses that provide wireless
    broadband Internet access to rural areas may be one example.[^137]
    Under this example, the first and second factors may not negatively
    impact the third factor -- *i.e.,* protect public safety and
    national security -- where it could be shown that LEAs' needs could
    be addressed through means other than including such entities within
    CALEA. We seek comment on this analysis and how best to identify
    these discrete groups of broadband Internet access providers and
    what additional factors would be appropriate for the Commission to
    consider in addressing their particular circumstances.

50. We do not believe that CALEA's exclusion for information services
    should alter our tentative conclusion. Congress expressly excluded
    "persons or entities insofar as they are engaged in providing
    information services"[^138] from CALEA's definition of
    "telecommunications carrier."[^139] (We refer to this as the
    Information Services Exclusion.) We also note that section
    103(b)(2)(A) of CALEA provides that the CALEA capability
    requirements do not apply to information services.[^140] CALEA's
    definition of "information services" is very similar to that of the
    Communications Act.[^141] For purposes of the Communications Act,
    the Commission has concluded that cable modem service is an
    information service and has tentatively concluded that wireline
    broadband Internet access service is also an information
    service.[^142] Assuming those determinations become final, those
    services would, nonetheless, have to be evaluated under CALEA's
    separate definition of "telecommunications carrier" which, as
    discussed above, is broader than the definition in the
    Communications Act.[^143] Where a service provider is found to fall
    within CALEA's Substantial Replacement Provision (as explained
    above) it would be deemed a "telecommunications carrier" for
    purposes of CALEA to which CALEA obligations would apply. If, at the
    same time, we interpreted CALEA's Information Services Exclusion to
    apply, it would present an irreconcilable tension; that is,
    particular service providers would find themselves at the same time
    subject to CALEA under the Substantial Replacement Provision and
    exempted from it by virtue of the Information Services Exclusion. We
    believe that the better reading of the statute is to recognize and
    give full effect to CALEA's broader definition of
    "telecommunications carrier" and to interpret the statute to mean
    that where a service provider is determined to fall within the
    Substantial Replacement Provision, by definition it cannot be
    providing an information service for purposes of CALEA. An
    examination of the history and purposes of CALEA supports this
    interpretation.

51. The facts surrounding the enactment of CALEA and statements of
    Congress support the conclusion that Congress did not intend for
    broadband Internet access to be excluded from CALEA when it falls
    within the Substantial Replacement Provision. At the time CALEA was
    enacted, Internet services were generally provided on a dial-up
    basis by two separate entities providing two different capabilities
    -- a local exchange telephone company carrying the calls between an
    end user and its chosen Internet Service Provider ("ISP"), and the
    ISP providing e-mail, content, web hosting and other Internet
    services. In the *House Report*, Congress was quite clear as to the
    CALEA status of these different entities: The LEC providing the
    local exchange transmission service that enabled the call to that
    dial-up ISP -- "the transmission of an E-mail message" -- was
    covered by CALEA as a telecommunications carrier providing a POTS
    functionality (a "phone call").[^144] By contrast, the separate ISP
    was not subject to CALEA because the functions it provided -- such
    as "\[t\]he storage of a message in a\[n\] . . . E-mail 'box'" --
    were "information services."[^145] Our tentative conclusion respects
    Congress's understanding and does not propose attaching CALEA
    obligations to services or applications that "ride over" the
    underlying broadband transmission, such as e-mail storage, web
    browsing capabilities, and Internet gaming.

52. Congress's expectation about CALEA coverage was entirely consistent
    with Commission regulations at the time. In 1994 (and today), when
    incumbent LECs and other facilities-based telecommunications
    carriers provided "enhanced services" (the regulatory predecessor to
    "information services"), they were required by Commission rules to
    offer the underlying transmission on a common carrier basis to other
    information services providers. Thus, the underlying transmission
    component of those services would always have been subject to CALEA
    under the definition of "telecommunications carrier." Given
    Congress's clear understanding that carriers providing *access* to
    ISP functionalities would be subject to CALEA, we do not believe
    that Congress intended the Information Services Exclusion to remove
    from CALEA's reach the comparable access function provided by
    today's broadband Internet access providers.[^146] Indeed,
    permitting technological developments to remove services from
    CALEA's coverage would be at odds with Congress's explanation that
    CALEA's purpose is "to *preserve* the government's ability . . . to
    intercept communications involving advanced technologies" and "to
    insure that law enforcement can continue to conduct authorized
    wiretaps in the future."[^147] We would therefore resolve any
    tension in CALEA's definitions in favor of CALEA's applicability to
    broadband Internet access service and classifying providers of
    broadband Internet access under CALEA as telecommunications
    carriers, not information services providers. We seek comment on
    this analysis.

    \(ii\) VoIP Services

53. As explained in the *IP-Enabled Services Notice*, there is a wide
    array of packet-based services currently using IP as well as
    numerous ways that VoIP capabilities might be provided to
    consumers.[^148] For example, one VoIP service in particular, which
    we refer to in this proceeding as "managed" VoIP, may be offered to
    the general public as a means of communicating with anyone,
    including parties reachable only through the public switched
    telephone network ("PSTN").[^149] Other VoIP offerings involve the
    capability to communicate on a peer-to-peer basis only with other
    members of a closed user group or groups such as the Free World
    Dialup offering described in the *Pulver.com Declaratory
    Ruling*.[^150] Still other VoIP capabilities may be additional
    features of other services or applications that enable voice
    communications with a particular user group such as between Xbox
    users during an interactive game session or voice-enabled Instant
    Messaging.[^151]

54. Law Enforcement seeks a Commission declaration that at least three
    different "business models" of VoIP service, in addition to all
    forms of broadband Internet access, are subject to CALEA.[^152] It
    indicates CALEA applies to these VoIP offerings because of the
    "obvious similarity" to "traditional circuit-mode telephony."[^153]
    Each of the models listed by Law Enforcement involves a managed VoIP
    offering accessible through a consumer's broadband Internet access
    connection.[^154] The primary difference for each model is the
    relationship, if any, between the VoIP provider and the broadband
    Internet access provider.[^155] Law Enforcement indicates that a
    failure to find these VoIP services subject to CALEA would pose a
    serious risk that certain call content and call-identifying
    information would evade lawful electronic surveillance.[^156] Law
    Enforcement indicates, however, that "peer-to-peer" VoIP
    communications are not intended to be covered by CALEA.[^157]

55. Some commenters support Law Enforcement's claim that some VoIP
    service providers should be subject to CALEA.[^158] Other
    commenters, however, maintain that it is unnecessary to subject VoIP
    service providers to CALEA because Law Enforcement may intercept
    packet-based communications through the PSTN or other transmission
    networks.[^159] Commenters also suggest that in determining whether
    VoIP service providers are covered, the Commission should
    distinguish between the types of network architecture used by VoIP
    providers and, for example, exempt those that utilize a closed
    network solution, such as in exclusively peer-to-peer
    applications.[^160]

56. We tentatively conclude that providers of managed VoIP
    services,[^161] which are offered to the general public as a means
    of communicating with any telephone subscriber, including parties
    reachable only through the PSTN, are subject to CALEA. We believe
    that such VoIP service providers satisfy each of the three prongs of
    the Substantial Replacement Provision with respect to their VoIP
    services.[^162] That is, they provide an electronic communication
    switching or transmission service that replaces a substantial
    portion of local exchange service for their customers in a manner
    functionally the same as POTS service; and the public interest
    factors we consider at a minimum -- *i.e.*, the effect on
    competition, the development and provision of new technologies and
    services, and public safety and national security -- support
    subjecting these providers to CALEA.[^163] We believe there is an
    overriding public interest in maintaining Law Enforcement's ability
    to conduct wiretaps of on-going voice communications that are taking
    place over networks that are rapidly replacing the traditional
    circuit-switched network, yet providing consumers essentially the
    same calling capability that exists with legacy POTS service.[^164]
    We understand that basic capabilities essential to Law Enforcement's
    surveillance efforts, such as access to call management information
    (*e.g.*, call forwarding, conference call features such as party
    join and drop) and call set up information (*e.g.*, real time speed
    dialing information, post-dial digit extraction information) may not
    be reasonably available to the broadband access provider.[^165]
    Consequently, subjecting only the broadband access provider to CALEA
    without including managed VoIP service providers could undermine Law
    Enforcement's surveillance efforts. We seek comment on this
    analysis.

57. We tentatively decline to adopt Law Enforcement's recommendation of
    basing statutory classifications on proposed "business models." We
    have strong concerns that such a regulatory approach could be easily
    circumvented and could adversely affect innovation by giving VoIP
    service providers a regulatory incentive (rather than a business or
    technical incentive) to design their services to avoid falling
    within one of the covered business models. Nevertheless, we invite
    comment on the proposed models and on the business model approach
    generally.

58. We also seek comment on our tentative conclusion that providers of
    non-managed, or disintermediated, communications should not be
    subject to CALEA.[^166] Non-managed VoIP services, such as
    peer-to-peer communications and voice enabled Instant Messaging, as
    currently provided, do not appear to be subject to CALEA for two
    reasons. First, because they are confined to a limited universe of
    users solely within the Internet or a private IP-network, they may
    be more akin to private networks, which Congress expressly excluded
    from section 103's capability requirements.[^167] Therefore, they do
    not appear to replace a substantial portion of local exchange
    service; as such they do not appear to fall within the Substantial
    Replacement Provision. Second, they may be excluded information
    services under section 103(b)(2)(A) (as discussed above). We seek
    comment on this issue. Are there other characteristics or
    distinguishing features that may be used to determine whether a
    particular class of VoIP service providers is covered under CALEA?
    One example may be that VoIP service providers are covered under
    CALEA where their service interconnects to the PSTN.

59. Finally, we ask commenters to identify other providers of
    packet-based or broadband services, if any, that may appear to
    satisfy CALEA's definition of "telecommunications carrier" and why
    the public interest would be served by subjecting these providers to
    CALEA.[^168] To the extent an entity is not a "telecommunications
    carrier" under CALEA, is there any legal basis for exercising
    ancillary authority to impose some type of law enforcement
    assistance requirements on these entities? Section 151 of the
    Communications Act charges the Commission with carrying out its
    obligations for a number of stated purposes, including "for the
    purpose of the national defense" and "for the purpose of promoting
    safety of life and property."[^169] How would the Information
    Services Exclusion and section 103(b)(2)(A) of CALEA impact the
    Commission's authority to exercise ancillary jurisdiction over
    non-subject entities?

    2\. Identification of Future Services and Entities Subject to CALEA

60. We tentatively conclude that it is unnecessary for us to adopt Law
    Enforcement's proposal regarding the identification of future
    services and entities subject to CALEA. We recognize Law
    Enforcement's need for more certainty regarding the applicability of
    CALEA to new services and technologies. We expect, however, the
    Commission's Report and Order in this proceeding to provide
    substantial clarity on the application of CALEA to new services and
    technologies that should significantly resolve Law Enforcement's and
    industry's uncertainty about compliance obligations in the future.
    In its Petition, Law Enforcement proposes that the Commission
    establish presumptions that: (1) a service is covered by CALEA
    pursuant to section 102(8)(A) if the service directly competes
    against a service already deemed to be covered by CALEA; (2) an
    entity is covered by CALEA pursuant to section 102(8)(A) if an
    entity is engaged in providing wire or electronic communication
    switching or transmission service to the public for a fee; and (3) a
    service currently provided using any "packet-mode" technology and
    covered by CALEA that subsequently is provided using a different
    technology will continue to be covered by CALEA.[^170] Further, Law
    Enforcement proposes that the Commission require any entity that
    believes that its equipment, facilities, or services are not subject
    to CALEA to file a petition for clarification with the Commission to
    determine its CALEA obligations.[^171] Law Enforcement argues that
    its proposed procedures would "ensur\[e\] that service offerings are
    CALEA-compliant on or before the date they are introduced to the
    marketplace."[^172] Opponents argue that the proposal is
    inconsistent with the statute and its legislative history.[^173]
    Moreover, they contend that Law Enforcement's proposal, if adopted,
    will amount to a government pre-approval requirement for new
    technologies that will inevitably inhibit innovation.[^174]

61. We are concerned that the proposed approach could be inconsistent
    with the statutory intent and could create an obstacle to
    innovation. The requirements of the statute and its legislative
    history seem to support opponents' arguments that Congress did not
    intend that manufacturers or providers would be required to obtain
    advance clearance from the government before deploying a technology
    or service that is not subject to CALEA.[^175] For example, as
    commenters note, the statute does not permit any LEA to prohibit the
    adoption of any equipment, facility, service or feature, and places
    the responsibility for compliance on the carrier, manufacturer, or
    provider.[^176] Moreover, we are concerned that, as a practical
    matter, providers will be reluctant to develop and deploy innovative
    services and technologies if they must build in CALEA capabilities
    to equipment that ultimately may not be subject to CALEA or wait for
    a ruling on the statute's application. Accordingly, based on the
    foregoing, we tentatively conclude that it is unnecessary for us to
    adopt Law Enforcement's proposal regarding identification of future
    services and entities subject to CALEA. We ask commenters to address
    our tentative conclusion. We additionally note that providers of new
    services may avail themselves of existing Commission procedures to
    seek clarification as to whether they are covered under CALEA.[^177]
    We seek comment on whether Commission procedures are sufficient for
    these purposes and ask commenters to assess whether there are other
    procedures, consistent with CALEA, that we might adopt to assist
    LEAs as well as industry in this regard.

# C. Requirements and Solutions  {#c.-requirements-and-solutions .unnumbered}

62. In this section we discuss a carrier's obligations under section 103
    and compliance solutions as they relate to broadband access and VoIP
    services. Based on the comments filed on the Petition, we believe
    there are several outstanding issues in each of these areas that
    must be addressed if we are to ensure successful implementation of
    CALEA.

**1. Carrier obligations under section 103**

63. Packet technologies are fundamentally different from the circuit
    switched technologies that were the primary focus of the
    Commission's earlier decisions on CALEA. These differences have led
    to disagreements among Law Enforcement and industry as to how to
    interpret and apply telecommunications carriers' obligations under
    section 103 of CALEA. Telecommunications carriers are required,
    under section 103, to enable LEAs, pursuant to a court order or
    other lawful authorization, (1) to intercept, to the exclusion of
    other communications, wire and electronic communications carried by
    the carrier to or from a subject, and (2) to access call-identifying
    information that is reasonably available to the carrier, subject to
    certain conditions. Further, the interception of communications or
    access to call-identifying information is to be delivered to LEAs in
    a format that may be transmitted, over the equipment, facilities or
    services procured by LEAs, to a location other than the provider's
    premises and in a way that protects the privacy and security of
    communications and information not authorized to be intercepted or
    accessed.

64. CALEA defines call-identifying information as "dialing or signaling
    information that identifies the origin, direction, destination, or
    termination of each communication generated or received by a
    subscriber by means of any equipment, facility, or service of a
    telecommunications carrier." In applying this definition to the
    initial J-STD-025, which dealt primarily with circuit-switched
    networks, the Commission determined that call-identifying
    information was not limited to telephone numbers and that it was
    appropriate in some cases to use a functional equivalent to give
    meaning to the statutory terms (*e.g*., wireless carriers identify
    the physical location of the antenna tower that a mobile phone uses
    to connect at the beginning and end of a call).[^178] The Commission
    adopted the following definitions of the component terms in the
    statutory definition of call-identifying information: **origin** is
    a party initiating a call (*e.g.*, a calling party), or a place from
    which a call is initiated; **destination** is a party or place to
    which a call is being made (*e.g.*, the called party); **direction**
    is a party or place to which a call is re-directed or the party or
    place from which it came, either incoming or outgoing (*e.g.*, a
    redirected-to party or redirected-from party); and **termination**
    is a party or place at the end of a communication path (*e.g.*, the
    called or call-receiving party, or the switch of a party that has
    placed another party on hold).[^179] The Commission concluded that
    these definitions defined call-identifying information in a manner
    that could be converted into actual network capabilities and would
    accommodate CALEA's intent to preserve the ability of LEAs to
    conduct electronic surveillance as technology changes.[^180]

65. We believe that carriers, manufacturers and Law Enforcement have
    applied the statutory definition of call-identifying information, as
    well as the Commission's definitions for the terms origin,
    destination, direction and termination, in developing standards or
    proprietary solutions for packet-mode technologies. However, the
    exact application of these terms is not always clear.
    Call-identifying information may be found within several
    encapsulated layers of protocols.[^181] For example, the data link
    layer (supported by switches or bridges) contains hardware source
    and destination address information; the network layer (supported by
    routers) contains the source and destination IP address; and the
    transport/session/presentation/application layers (supported by host
    devices and gateways) contain source and destination port addresses,
    session sources and destinations, and session start and stop times.
    As the packet makes its way through the network of the broadband
    access service and Internet service providers, these providers'
    equipment generally do not examine or process information in the
    layers used to control packet-mode services such as VoIP, and in
    fact operate at layers below the ones that carry control information
    for broadband access services. As a result, the broadband access
    service and Internet service providers may not be able to easily
    isolate call-identifying information for VoIP without examining the
    packet in detail, or in other words, examining the packet content.

66. There are potentially several kinds of information about broadband
    access service that Law Enforcement may seek under section 103's
    requirements. For broadband access these potentially include, but
    are not necessarily restricted, to the following: (1) information
    about the subject's access sessions, including start and end times
    and assigned IP addresses, for both mobile and fixed access
    sessions; (2) information about changes to the subject's service or
    account profile, which could include, for example, new or changed
    logins and passwords; and (3) information about packets sent and
    received by the subject, including source and destination IP
    addresses, information related to the detection and control of
    packet transfer security such as those in Virtual Private Networks
    ("VPNs"), as well as packet filtering to favor certain traffic going
    to or from certain customers. For VoIP, the concept of "call" seems
    well understood, and we might expect call-identifying information to
    include who called whom when for how long, and concepts similar to
    call-identifying information for circuit-mode calls.

67. We seek comment on whether the Commission needs to clarify the
    statutory term "call-identifying information" for broadband access
    and VoIP services. We ask that commenters provide specific
    suggestions for these definitional issues. A more precise
    understanding of these terms would support the Commission's efforts
    to encourage carriers' compliance with their CALEA obligations
    whether in acting on petitions filed under sections 107(c) or 109(b)
    or in pursuing enforcement actions for violations of the
    Commission's rules. We also invite comment as to how the Commission
    should apply the term "reasonably available" to broadband access. We
    observe that the Commission has previously determined that
    information may not be "reasonably" available if the information is
    only accessible by significantly modifying a network.[^182] The
    Commission applied these criteria when determining that dialed-digit
    extraction ("DDE") could be made available without significantly
    modifying a circuit-switched network because the information was
    present at the circuit intercept access point.[^183] Although
    carriers would have to incur some costs to extract the information,
    we did not view cost as a factor in whether information is
    "reasonably available" for purposes of section 103(a)(2). We
    determined that cost concerns were best addressed as part of a
    section 107(b) analysis in deciding whether to require the provision
    of DDE.

68. We tentatively conclude that we should apply the same
    criteria---*i.e*. information may not be "reasonably" available if
    the information is only accessible by significantly modifying a
    network---to broadband access and VoIP providers. We seek comment on
    this tentative conclusion. We recognize that, when looking at
    end-to-end service architectures, it is not always readily apparent
    where call-identifying information is available. We seek comment on
    where content and various kinds of call-identifying information are
    available in the network and further whether the information is
    reasonably available to the carrier. We anticipate that some
    call-identifying information may be available from either a VoIP
    provider or a broadband access provider. In these instances, would
    the call-identifying information be reasonably available from one
    entity but not from the other? If the information is reasonably
    available from both carriers, we expect that both carriers would
    have a CALEA obligation with respect to that information and would
    work cooperatively with each other and with the LEA to provide the
    LEA with all required information. We seek comment on these issues.

**2. Compliance solutions based on use of a "trusted third party"**

69. Telecommunications carriers under CALEA may use a variety of means
    for making content or call-identifying information available to
    LEAs. We seek comment on one approach that, although it would not
    relieve carriers of their obligation to comply with CALEA, may
    simplify or ease the burden on carriers and manufacturers in
    providing packet content and call-identifying information. We refer
    to this approach as the "trusted third party" approach, that is
    being used today both in the United States and elsewhere.[^184] A
    trusted third party is a service bureau with a system that has
    access to a carrier's network and remotely manages the intercept
    process for the carrier. The service bureau may manage CALEA
    operations for multiple carriers, and the service bureau's system
    may be completely external to all of those carriers' networks.

70. The trusted third party approach recognizes that, even if a carrier
    does not process certain call-identifying information, that
    information may be extracted from that carrier's network and
    delivered to a LEA. The trusted third party obtains the call content
    and call-identifying information in either of two ways. The trusted
    third party could rely on a mediation device to collect separated
    call content and call-identifying information from various points in
    the network and to deliver the appropriate information to a LEA.
    Alternatively, the trusted third party could rely on an external
    system to collect combined call content and call-identifying
    information and to deliver the appropriate information to a LEA. We
    describe both of these models in Appendix C.[^185] We believe that
    the availability of a trusted third party approach makes
    call-identifying information "reasonably" available to a
    telecommunications carrier under section 103(a)(2). We seek comment
    on this analysis.

71. Our discussion below focuses on the external system approach which
    would identify, isolate and extract call-identifying information
    from the packets going to and from a subject. Using an external
    system to extract the content and call-identifying information of a
    communication from encapsulated packets has several advantages. As
    VeriSign notes, the use of a third party would permit "lawful
    interception of Internet access, IP-Enabled or VoIP services" but
    would not "adversely affect the evolution or deployment of those
    services."[^186] The network equipment used to provide the service
    would only need to be able to provide the subject's raw content to
    the external system. The trusted third party would, in turn, do the
    heavy lifting, *i.e.*, analyze the data and provide a LEA with only
    that information to which it is entitled. The advantage to equipment
    manufacturers is that suppliers of network equipment for new
    services would not have to choose between providing potentially
    expensive surveillance features that may turn out not to be required
    under CALEA, versus not providing the surveillance features
    initially and potentially having to "force fit" the features into
    the equipment design if they are subsequently required. The
    advantage to carriers and service providers is that the use of a
    trusted third party could minimize the impact of CALEA on network
    evolution and the deployment of new services.

72. We seek comment on the feasibility of using a trusted third party
    approach to extract the content and call-identifying information of
    a communication from packets. In particular, we seek comment on
    whether an external system would be an efficient method to extract
    information from packets. It seems that external systems might
    provide economies of scale for small carriers. What would be the
    approximate relative costs of internal versus external systems for
    packet extraction?

73. We recognize, however, that there may be some tension between
    relying on a trusted third party model and relying on "safe harbor"
    standards. For example, if a trusted third party approach makes
    call-identifying information "reasonably" available to a
    telecommunications carrier, should a standard that requires a
    carrier to provide only the information it uses to process a packet
    be considered a "safe harbor" if a LEA would not have all
    call-identifying information for the communication?

74. Reliance on a trusted third party may shift the burden now shared by
    carriers and manufacturers in complying with CALEA. For example,
    would it be adequate to require network equipment to provide only
    packet content under the terms of J-STD-025-A, and to allow the
    manufacturers of that equipment to assume that any additional
    analysis of the content will be provided by an external system? TIA
    asks "May a particular \[network equipment supplier\] conclude that
    its customers can find other CALEA solutions from other suppliers,
    and at that point withdraw from the CALEA process without liability?
    ... Could a supplier be forced to reenter the CALEA market if the
    third-party suppliers it was counting on go out of business?"[^187]
    What impact would reliance on a trusted third party have on
    developing standards for CALEA compliance? What tools would a
    service bureau need to interface with various products from numerous
    vendors and would this responsibility be difficult to meet or too
    expensive? Are there incentives to keep manufacturers engaged in
    developing CALEA compliance solutions if carriers relied on a
    trusted third party?

75. The financial responsibility for funding a trusted third party
    approach could follow several models. The trusted third party could
    be owned by the packet service provider or Law Enforcement, or it
    could be an independent surveillance service provider who contracts
    with individual carriers.

76. Finally, we seek comment on how a telecommunications carrier that
    relies on a trusted third party would meet its obligations under
    section 103(a) of CALEA, *e.g*., to protect the privacy and security
    of communications and call-identifying information not authorized to
    be intercepted, as well as to protect information regarding the
    government's interception of communications and access to
    call-identifying information.

**3. Compliance solutions based on CALEA "Safe Harbor" standards**

77. In this section, we invite comment on a variety of industry
    standards for packet-mode technologies to determine whether any of
    these standards are deficient and thus preclude carriers,
    manufacturers and others from relying on them as safe harbors in
    complying with section 103. Over the past several years, various
    standard setting organizations have been developing standards for
    various types of packet technologies that support a variety of
    applications used in both wireline and wireless networks. These
    standards could serve, pursuant to section 107(a) of CALEA, as "safe
    harbors" for section 103 compliance by telecommunications carriers.
    The standards process is ongoing in several different venues, with
    some standards already having undergone modification and new ones
    under development. Compliance with a "safe harbor" standard is not
    required by CALEA.

78. Law Enforcement has been critical of some standards processes and
    states in its Petition that "industry standard-setting organizations
    did not agree with Law Enforcement's position that industry is
    required to provide the same level of capability for packet-mode
    technology as it does for circuit-mode technology. The unfortunate
    result is that packet-mode standards that have been published are
    deficient."[^188] It seems that underlying this assertion are
    assumptions that the definition of call-identifying information can
    be clearly applied to packet networks, that information so
    identified is "reasonably available" to the carrier, and that the
    provision of the information to LEAs by the carrier is "reasonably
    achievable." Some commenters, such as TIA, disagree with Law
    Enforcement's assertion and argue that the statute's requirements in
    section 103 must be evaluated with respect to a particular
    technology, not a service, and cannot be presumed to produce the
    same outcome for every technology.[^189] TIA adopted a technology
    platform approach, rather than a service-focused approach (*e.g*.,
    VoIP), in its standards work for several reasons. TIA believes that
    a service-focused approach would be difficult to implement because
    many different services can be deployed in different ways over any
    one platform and, since services evolve faster than platforms, it
    would be harder to develop a stable standard. On the other hand, a
    technology platform approach could define a set of network events
    common to all services and specify call-identifying information that
    could be extracted without analyzing more of the packet than would
    otherwise be required to process the packet.[^190]

79. Although pursuant to section 107(b) the Commission may, upon
    petition, establish rules, technical requirements or standards
    necessary for implementing section 103 \"\[i\]f a Government agency
    or any other person believes that such requirements or standards are
    deficient,\"[^191] the Court has determined that were it to allow
    the Commission to mandate modification of an industry standard
    "without first identifying its deficiencies, \[the Court\] would
    weaken the major role Congress obviously expected industry to play
    in formulating CALEA standards."[^192] We ask parties to comment on
    industry standards for packet-mode technologies in an attempt to
    determine whether any of these standards are deficient and thus
    preclude carriers, manufacturers and others from relying on them as
    safe harbors in complying with section 103. By doing so, however, we
    do not intend to inhibit the ongoing work by standards
    organizations, carriers and manufacturers to develop and deploy
    CALEA-compliant facilities and services. We recognize that CALEA
    provides that carriers and others may rely on publicly available
    technical requirements or standards adopted by an industry
    association or standard-setting organization to meet the
    requirements of section 103, unless the Commission takes specific
    action in response to a petition.

80. As an initial matter, we invite comment as to whether there is any
    need to define what constitutes publicly available technical
    requirements or standards adopted by an industry association or
    standard-setting organization. It appears that any group or
    organization could publish a set of technical requirements or
    standards and claim it to be a "safe harbor." Should we interpret
    the above terms to mean only standards developed by organizations
    recognized by the American National Standards Institute ("ANSI")?
    Should these terms also cover technical specifications that are
    developed and published by other types of industry organizations,
    such as CableLabs®, which is a consortium of cable TV system
    operators? Should we also recognize standards developed by non-U.S.
    standards organizations, such as the European Telecommunications
    Standards Institute?

81. We seek comments regarding the appropriateness of available
    standards and specifications, discussed in Appendix D, to be used as
    safe harbors for packet-mode communications for purposes of
    CALEA.[^193] Commenters should indicate whether the standard can
    serve as a safe harbor under section 107(a) for one or more packet
    services and/or technologies. In cases where a standard meets many
    but not all of the statutory requirements to serve as a safe harbor,
    commenters should identify where the standard is deficient, as that
    term is used in section 107(b).[^194] In areas where a commenter
    believes a standard is deficient, we seek suggestions on how the
    deficiency can be eliminated. We also seek comments about the reason
    or reasons for each alleged deficiency. For example, did standards
    developers believe that the feature would be unacceptably expensive
    or complex or otherwise not reasonably achievable? Was there concern
    that the surveillance feature might interfere with revenue-producing
    features? Was there a concern that a feature might be unacceptably
    invasive of privacy? Was there a concern that the feature would
    result in unacceptable degradation in service performance?
    Commenters should also provide estimates for the amount of time
    industry and LEAs are likely to need to correct the deficiency, and
    should indicate whether work to correct each deficiency has begun or
    been planned. In cases where a standard meets many but not all of
    the requirements to serve as a safe harbor for a service or
    technology, can the standard be used as a "temporary" safe harbor,
    providing LEAs with immediate access to some features and providing
    a telecommunications carrier with protection against demands for
    additional features pending further action by the Commission in
    response to a petition filed under section 107(b)?[^195]

82. We note, for example, that there are at least three areas of
    contention in the standards process for broadband access, as well as
    VoIP services. First, providers of circuit-mode voice services are
    required under CALEA to implement features to make post-connection
    dialed digits available to LEAs.[^196] DDE was among several
    features known collectively as the FBI's "punch list" for
    surveillance of circuit-mode services.[^197] These are features that
    Law Enforcement considered necessary, but which the industry claimed
    were not reasonably achievable in circuit-mode and were not included
    in the original version of J-STD-025. In regard to circuit-mode DDE,
    we have previously concluded "that some digits dialed by a subject
    after connecting to a carrier other than the originating \[service
    provider\] are call-identifying information. While a subject may
    dial digits after the initial call set-up that are not
    call-identifying information -- *e.g*., a bank account number to
    access his/her bank statement -- some digits dialed after connecting
    to an IXC \[interexchange carrier\] identify the \'origin,
    direction, destination or termination\' of the
    communications."[^198] We also determined that the post-connection
    dialed digits were "reasonably available" at the intercept access
    point, even though the carrier may not use the digits for call
    processing purposes, without significantly modifying a carrier's
    network by installing additional tone decoders.[^199]

83. For voice over packet (a technology used to provide most or all
    broadband telephony services), post-connection DDE is not required
    to be isolated and provided to LEAs under T1.678, T1.724,
    J-STD-025-B, or PKT-SP-ESP-I03-040113. A VoIP caller may also
    connect to an IXC, and the post-connection dialed digits may also
    identify the \'origin, direction, destination or termination\' of
    the communications. We seek comment on whether DDE in packet
    networks is call-identifying information for the same reasons that
    we have previously concluded that it is in circuit-switched
    networks.[^200] Are there differences in packet technology that
    would preclude post-connection dialed digits from being termed
    call-identifying information? Are there differences in packet
    technology that would preclude post-connection DDE from being
    readily achievable? Is the omission of DDE or other punch list
    capabilities from these standards a deficiency under the terms of
    section 107(b)?

84. Second, when broadband telephony call-identifying information is
    provided to LEAs, Law Enforcement may have concerns with the format
    of the electronic interface used to provide this information as
    described in T1.724 and under one option in T1.678. The issue is
    whether the industry can send LEAs copies of messages used by voice
    over packet systems that use terminology specific to the technology
    or function, or whether the messages must be converted into a format
    and common language more consistent with the messages in J-STD-025
    and PKT-SP-ESP-I03-040113.[^201] The kind of format used in
    J-STD-025 and PKT-SP-ESP-I03-040113 is preferred by Law Enforcement.
    We seek comment on what difficulties LEAs may encounter if
    information is provided in different formats, depending on the
    underlying transmission source. We also seek comment on whether
    uniformity of formatting is needed to satisfy the requirements of
    section 103(a)(3) concerning delivery of intercepted communications
    and call-identifying information.

85. Third, we seek comment about the adequacy or deficiency of available
    standards, including J-STD-025-B and T1.724, if broadband access
    service over cdma2000® or Universal Mobile Telecommunications System
    ("UMTS") wireless technology is ultimately determined to be subject
    to CALEA obligations. In particular, there is evidence of
    disagreement between Law Enforcement and the industry regarding
    CALEA obligations to provide call-identifying information on
    broadband access service communications between a surveillance
    subject and other customers and applications for broadband access
    service communications. Law Enforcement has requested information
    about each IP packet sent or received by a subject that includes
    certain information at higher protocol layers "that \[the broadband
    access service provider's network\] does not manage ... This may be
    a significant impact on the network equipment."[^202] Nortel
    considers this to be one of its "Thorny Technical LI Issues."[^203]
    TIA states that J-STD-025-B does not require many types of
    information requested by Law Enforcement for a cdma2000® packet data
    system platform because that platform does not specify call
    management server functionality, which is needed to make the
    information "reasonably available."[^204] We therefore seek comment
    not only on the kinds of events which must be reported to LEAs, but
    also on the information which must be reported on each such event.

**4. CALEA compliance for satellite networks based on system-by-system
agreements**

86. Next, we tentatively conclude that continued use of system-by-system
    arrangements is the appropriate method for satellite systems and
    will aid in meeting the goals of CALEA. We note that satellite
    carriers have used an approach based on negotiation, resulting in
    private agreements to provide information to LEAs.[^205] Satellite
    networks differ in fundamental ways not only from terrestrial
    networks but also from each other. These differences arise from
    unique aspects of the type of satellite used in the network (*e.g*.,
    non-geostationary vs. geostationary satellites) and the gateway
    earth stations that may be located both within and outside the
    United States. System-by-system agreements between LEAs and
    satellite carriers account for the unique aspects of each system.
    For example, the agreement between Iridium Constellation LLC
    ("Iridium"), DoJ, and the FBI requires that Iridium pass all
    domestic communications (defined as (i) wire or electronic
    communications that originate and terminate within the U.S. and (ii)
    the U.S. portion of a wire/electronic communication that originates
    or terminates within the U.S.) through "a facility under the control
    of Iridium and physically located in the U.S., from which Electronic
    Surveillance may be conducted."[^206] Similarly, the LEA agreement
    with Telenor Satellite, Inc. requires that all domestic
    communications be transmitted through U.S. earth stations or routed
    through a point of presence "that includes a network switch or
    router under the control of" Telenor that is located in the
    U.S.[^207] We tentatively conclude that continued use of
    system-by-system arrangements is the appropriate method for
    satellite systems and will aid in meeting CALEA's goals. We seek
    comment on this tentative conclusion

## D. CALEA COMPLIANCE EXTENSION PETITIONS {#d.-calea-compliance-extension-petitions .unnumbered}

87. In this section, we discuss CALEA compliance and the availability of
    compliance extensions and relief from compliance, respectively,
    under CALEA sections 107(c) and 109(b). We propose to restrict the
    availability of compliance extensions under section 107(c),
    particularly in connection with packet-mode requirements, and we
    clarify the role and scope of CALEA section 109(b), which provides
    that the Commission may find that compliance with CALEA section 103
    is not reasonable achievable, leaving it to the Attorney General to
    determine whether to pay telecommunications carriers' compliance
    costs.[^208]

    **1. Background**

88. In its Petition, Law Enforcement contends that the CALEA
    implementation process, both with respect to packet-mode
    technologies and generally, is not working because there is no
    specific, concrete implementation and compliance plan. Accordingly,
    Law Enforcement requests that the Commission impose implementation
    deadlines and benchmark filings to phase in CALEA packet-mode
    compliance, just as the Commission has previously required in
    connection with other important public safety mandates, such as
    E911. Law Enforcement also requests that the Commission codify in
    its rules any CALEA packet-mode compliance phase-in benchmarks and
    deadlines and related filing requirements that it adopts, just as it
    did with the benchmarks and deadlines it adopted in the E911
    docket.[^209]

89. To date, the Commission has granted hundreds of section 107(c)
    extension petitions in consultation with the FBI[^210] to permit
    carriers to phase-in CALEA compliance in connection with both
    circuit-switched and packet technologies.[^211] The extension
    process has been relatively simple. In 2000, the Commission directed
    carriers to file extension petitions as of a date certain, and
    granted conforming petitions provisional, two-year extensions
    pending Commission action on the merits of individual petitions,
    based on a section 107(c)-based determination that compliance was
    not \"reasonably achievable through application of technology within
    the compliance period.\"[^212] In their *9/28/01 Public Notice*, the
    Commission's Common Carrier and Wireless Telecommunications Bureaus
    directed carriers and others seeking section 107(c) extensions of
    packet-mode CALEA requirements to file petitions no later than
    November 19, 2001, and granted additional, provisional two-year
    extensions.[^213] In their *11/19/03 Public Notice*, the
    Commission's Wireline Competition and Wireless Telecommunications
    Bureaus further extended these provisional extensions until January
    30, 2004.[^214] These packet-related extensions have now
    expired.[^215] We have received approximately 800 *new*
    packet-related extension petitions since November 19, 2003. Because
    the terms of the *9/28/01 Public Notice* remain in force, these
    petitions have all been afforded provisional two-year extensions,
    pending our action on the petitions.

90. Prior to June 30, 2004, the Commission also had on file
    approximately 750 section 107(c) petitions filed in connection with
    circuit-based CALEA requirements imposed pursuant to the
    Commission's April 2002 *Order on Remand* that responded to issues
    identified by the United States District Court.[^216] After
    affirming the so-called "punch list" additions to the original
    J-Standard, the Commission directed carriers and others to file any
    section 107(c) extension petitions no later than June 30, 2002.
    Filed petitions received provisional, two-year extensions, which
    expired on June 30, 2004.[^217] Since then, the Commission has
    received approximately 330 new section 107(c) petitions from
    wireline carriers, most seeking additional extensions to June 30,
    2006.

    **2. Discussion**

91. We support Law Enforcement's goal of strengthening the CALEA
    implementation process. We agree that timely implementation of both
    circuit-mode and packet-mode technology by telecommunications
    carriers is essential to ensure that electronic surveillance can be
    readily and efficiently performed. However, we believe that Law
    Enforcement's goal can be achieved without us imposing the
    implementation deadlines and benchmark filings it requests. We
    recognize that carriers have continued to rely on CALEA section
    107(c) when submitting extension requests for packet-mode
    compliance. We intend to resolve the status of those petitions in
    this proceeding, but in a way that is not unduly disruptive.
    Accordingly, we intend to afford all carriers a reasonable period of
    time in which to comply with, or seek relief from, any
    determinations that we eventually adopt. We tentatively conclude
    that a "reasonable period of time" is 90 days and request comment on
    this tentative conclusion.[^218] We may, on less than 90 days
    notice, require any or all carriers to provide additional
    information to support their extension requests. We seek comment on
    all issues identified in the following analysis, as well as any
    other issues that relate to disposition of pending and future
    extension requests.

    **a. Disposition of Circuit-Mode Extension Petitions**

92. In their *9/28/01 Public Notice*, the Commission's Common Carrier
    and Wireless Telecommunications Bureaus linked consideration of
    section 107(c) extension petitions to carrier participation in the
    FBI's Flexible Deployment Program.[^219] This program provides a
    negotiation-based framework whereby the FBI and carriers agree upon
    carrier-specific schedules for achieving CALEA compliance.[^220]
    Based on staff conversations with industry representatives,
    third-party CALEA service providers, and the FBI, we believe that
    this approach has encouraged many carriers to become CALEA compliant
    with respect to circuit-based functionalities.[^221] Because of the
    success of this program, the wide availability of circuit-based
    CALEA solutions, and the ability of most carriers to recover
    associated costs, it appears unlikely that many carriers will
    qualify for additional circuit-mode extensions, *i.e*., after June
    30, 2004.[^222] Certain entities, predominantly small and rural
    carriers, however, may qualify for additional extensions for
    cost-related or other reasons. Many of these carriers are enrolled
    in the FBI's Flexible Deployment Program and, we believe, are
    continuing active negotiations with the FBI. We encourage such
    carriers to continue these negotiations. We seek comment about
    whether we should authorize additional section 107(c) extensions in
    such cases, *i.e*., by basing extension grants on active
    participation in the Flexible Deployment Program and continued FBI
    support for particular petitions. Specifically, we seek comment on
    whether participation in the Flexible Deployment Program with FBI
    support should continue to function as a surrogate or proxy
    determination of what is "reasonably achievable" under section
    107(c). We note that most of the new section 107(c) petitions filed
    by wireline carriers in response to the June 30, 2004 expiration
    date have been filed by rural carriers.

93. We also seek comment about what supporting information and
    documentation should accompany section 107(c) petitions if carriers
    are not participating in the Flexible Deployment Program, or if the
    FBI were to oppose a particular petition filed by a carrier
    participating in the program, or if the FBI were to terminate the
    program. We tentatively conclude that submitted information should
    include a compliance plan that will outline how the petitioner
    proposes to become CALEA compliant for circuit-mode capabilities by
    specified dates, and that no date may be set later than two years
    after the date of the petition. Additionally, the petition should
    include the information described in Appendix E of this *Notice*, as
    well as a "due diligence" description of the petitioner's attempts
    to become CALEA compliant since June 30, 2002. This description
    should include a documented recital of negotiations with equipment
    manufacturers and third-party CALEA service providers, or other
    persuasive evidence that the petitioner actively and diligently
    searched for available CALEA-compliant solutions. Regarding
    petitioner showings about costs associated with circuit-mode CALEA
    compliance, we expect that parties will submit detailed and specific
    information, and we direct parties' attention to the discussion in
    the *Second R&O*, including our determination that costs not
    directly related to CALEA compliance may not be included.[^223] We
    seek comment on all aspects of this analysis and related issues and
    questions,[^224] including appropriate protections for cost and
    other information that petitioners assert to be proprietary or
    otherwise sensitive.[^225]

    **b. Disposition of Packet-Mode Extension Petitions**

    **(i) Background**

94. More than two years have passed since the Commission mandated that
    carriers intercept and deliver packet content to LEAs pursuant to
    CALEA. Progress toward achieving packet-based compliance has been
    slow, with few carriers implementing the content standard to date.
    Even more frustrating, industry progress developing additional
    packet-based standards has been slow, notwithstanding our
    expectation that this process would accelerate following adoption of
    a content standard. Nevertheless, Commission staff conversations
    with the Alliance for Telecommunications Industry Solutions ("ATIS")
    and other participants in the section 107(a)(2) standards-setting
    process confirm that additional packet-mode standards recently have
    been developed that address call-identifying information required in
    connection with call intercept requests.

95. Since November 19, 2003, we have received more than 800 packet-mode
    extension petitions from large and small telecommunications
    carriers, including the Regional Bell Operating Companies ("RBOCs").
    Most of these petitions cite lack of an available packet-mode
    solution as the primary reason justifying an extension; about half
    of the submitted petitions also claim that there are no packet-based
    standards.[^226] Roughly a quarter of the petitions assert that lack
    of regulatory guidance about what services are subject to CALEA
    justifies an extension, and some argue that their services are not
    subject to CALEA at all. Some petitioners state that cost is a
    factor justifying extension, but by and large they do not identify
    specific costs. In terms of the services offered, nearly all of the
    petitioners state that they "provide Digital Subscriber Line ("DSL")
    service" or are using equipment commonly used to provide DSL
    services, but by-and-large they do not specify whether they are
    referring to DSL-based Internet access, or DSL transport. A few
    petitioners state they are providing Asynchronous Transfer Mode
    ("ATM"), Frame Relay ("FR"), or Integrated Services Digital Network
    ("ISDN"). Reflecting this service mix, most petitioners indicate
    that they employ Digital Subscriber Line Access Multiplexers
    ("DSLAMs"), and nearly half deploy routers. In addition, a number of
    petitioners claim to have deployed a variety of ATM access and
    multi-service switches and multiplexers. Some petitioners include
    circuit switches in their network architecture descriptions, usually
    in relation to ISDN service.

    **(ii) Availability of Sections 107(c) and 109(b) in Connection with
    Packet- Mode**

96. In construing CALEA sections 107(c) and 109(b),[^227] the Commission
    has concluded that they are complementary provisions that serve
    different purposes: "Section 107(c) concerns extensions of the
    compliance deadline, while section 109(b) addresses who pays for
    modifications made to those portions of a carrier's networks that
    were "installed or deployed after January 1, 1995."[^228] The
    Commission has not, to date, set out in detail its understanding of
    what factors should be considered in determining what is or is not
    "reasonably achievable" under the terms of section 107(c). However,
    it has determined that Congress intended that an evaluation of
    "reasonable" in the context of section 107(c) should include
    "consideration for the evolutionary introduction of new technology
    by telecommunications carriers in the normal course of
    business."[^229] The Commission has expressly declined to read into
    section 107(c) the eleven criteria set out in section
    109(b)(1).[^230] Moreover, it has not construed those eleven
    criteria in a rulemaking proceeding, and instead has decided to
    consider section 109(b) petitions on a case-by-case basis.[^231]
    Thus, we have not, for example, considered whether we should weigh
    these criteria equally when evaluating section 109(b) petitions or
    whether we should assign greater weight to particular criteria.

97. Section 107(c) expressly limits extensions to cases where the
    petitioning carrier proposes to install or deploy, or has installed
    or deployed, its "equipment, facility, or service *prior to the
    effective date of section 103* ...,"[^232] *i.e*., prior to October
    25, 1998. Given this limitation, we believe that a section 107(c)
    extension is not available to cover equipment, facilities, or
    services installed or deployed after October 25, 1998. This
    interpretation of the scope of section 107(c) would likely preclude
    granting section 107(c) relief in connection with packet-mode
    applications because, in our experience, most if not all carrier
    packet-based "equipment, facilit\[ies\], or service" have been
    installed or deployed after the section 107(c)-mandated cut-off
    date.[^233] We seek comment on this analysis.

98. Moreover, we believe that carriers face a high burden in making an
    adequate showing to obtain alternative relief pursuant to section
    109(b). Under the requirements of that section, carriers must
    demonstrate that compliance is not reasonably achievable, and we
    must evaluate submitted petitions under the criteria set out in
    section 109(b)(1), including cost and cost-related criteria and an
    assessment of the effect of any granted extension "on public safety
    and national security."[^234] It would be difficult for a petitioner
    to make such a showing unless the request was made in connection
    with precisely identified "equipment, facilities, or services." As
    explained more fully below, under the requirements of section
    109(b)(1)(B) and 109(b)(1)(D), such a demonstration would need to
    include a thorough analysis of precisely identified costs of
    upgrading the carrier's network to satisfy CALEA obligations and of
    other difficulties, as well as their effects on ratepayers; general
    allegations that projected costs were "too high" or unreasonably
    burdensome would not suffice. We tentatively conclude that the
    requirements of section 109(b) would not be met by a petitioning
    carrier that merely asserted that CALEA standards had not been
    developed, or that solutions were not readily available from
    manufacturers. Unlike section 107(c), section 109(b) contains no
    requirement that we evaluate what is "reasonably achievable" with
    reference to available technology. We recognize, however, that
    carriers may bring to the Commission's attention section 107(c)
    requirements in the context of a section 109 petition, under the
    heading "such other factors as the Commission determines are
    appropriate."[^235] If standards or solutions do not exist,
    petitioning carriers would still need to demonstrate why they could
    not negotiate system-specific CALEA solutions with manufacturers or
    with third-party CALEA service providers. In short, we believe that
    petitioners that purchased and installed non-CALEA compliant
    equipment after the CALEA compliance date bear a heavy burden to
    show why they could not have selected CALEA-compliant equipment.
    That showing must include a demonstration that the petitioning
    carrier exercised due diligence to obtain CALEA-compliant solutions
    from manufacturers or third-party service providers. We seek comment
    on this analysis.

99. Under this interpretation of the applicability and scope of sections
    107(c) and 109(b), we believe that many carriers could find it
    difficult to obtain either CALEA compliance extensions or exemptions
    in connection with packet requirements. As a result, they may become
    immediately subject to enforcement action.[^236] This outcome could
    be precisely what Congress intended, because it would encourage
    carriers to press for the development of CALEA standards by
    industry-staffed committees and for solutions from manufacturers.
    Under this reading of the statute, neither section 107(c) nor
    section 109(b) provides a permanent exemption from CALEA's section
    103 compliance mandate. And it reflects a statutory expectation that
    whenever a carrier replaces or upgrades its network architecture
    after section 107(c)'s mandated compliance date, it must do so by
    employing CALEA-compliant equipment, or explain why it could not do
    so under the stringent requirements of a section 109(b) petition.

100. We seek comment on this interpretation of the relationship of CALEA
     sections 103, 107(c), and 109(b) and the likely effects if we apply
     it to pending packet-mode section 107(c) extension petitions.
     Although this interpretation of the relationship of CALEA sections
     103, 107(c), and 109(b) appears to be consistent with the CALEA
     statute considered as a whole, it clearly imposes great
     responsibility on carriers to actively and consistently advocate
     for the development of technical standards and solutions. We
     recognize that this statutory interpretation could create
     potentially heavy burdens for small and rural carriers in
     particular. For example, the section 107(a) "safe harbor" provision
     encourages the development of CALEA standards that allow small and
     mid-size carriers to take advantage of standards that are
     negotiated among large carriers and equipment manufacturers.[^237]
     Would this process be encouraged or impeded by the interpretation
     of CALEA sections 103, 107(c), and 109(b) described here?[^238]

101. We recognize that the interpretation of the applicability and scope
     of section 107(c), as discussed above, would represent a change
     from the manner in which the Commission has applied section 107(c)
     in the past. For example, we have previously afforded petitioning
     carriers provisional section 107(c) extensions for packet mode
     pursuant to our *9/28/01 Public Notice,*[^239] which potentially
     covers equipment installed or deployed *after* October 25, 1998
     (the effective date of section 103). Our application of section
     107(c) at that time was supported by the FBI, which specifically
     included packet-mode in its Flexible Deployment Program.[^240] We
     recognize that, if the proposed interpretation of section 107(c) is
     ultimately adopted, affected carriers may require additional time
     to seek alternative relief or to become CALEA-compliant for packet
     mode. We propose to afford carriers with packet-mode section 107(c)
     petitions currently on file ninety (90) days to file any requests
     for alternative relief in the event that the Commission affirms the
     proposed interpretation of the applicability and scope of section
     107(c) in a subsequent Report and Order. We also seek specific
     comment whether a blanket transition period is required to afford
     affected carriers an adequate opportunity to become CALEA-compliant
     for packet mode. Commenters should address what authority the
     Commission has to grant any such transition period, if section
     107(c) is not available for packet-mode equipment installed or
     deployed after October 1998.

102. We also seek comment about how this interpretation of the
     relationship between sections 103, 107(c), and 109(b) comports with
     the realities of packet-based technology development. The section
     107(c)/section 109(b) regime we describe would seem aimed primarily
     at achieving CALEA compliance in a circuit-based technology
     environment, where a relatively standardized, switch-based
     technology could be readily retrofitted or otherwise modified (and
     largely with funding provided directly by DoJ/FBI). Do CALEA's
     section 107(c) and 109(b) mechanisms adequately address the
     requirements of rapidly evolving packet-based technologies and
     architectures? Congress may not have anticipated these difficulties
     and complexities when CALEA was enacted, given that the primary
     network model available at that time (1994) reflected a
     switch-centralized network providing POTS and various related
     services. If not, can sections 107(c) and 109(b) nevertheless be
     interpreted in ways that, consistent with their stated limitations,
     facilitate packet-mode CALEA compliance?

103. Even if section 107(c) continues to be available for legacy packet
     services, we cannot use participation in the Flexible Deployment
     Program to support additional extension grants because the FBI has
     terminated that program for packet-based applications. Moreover,
     based on our examination of the pending packet-based petitions, we
     preliminarily conclude they lack sufficient information to enable
     us to conduct a complete review. Accordingly, for legacy
     packet-service providers that wish to file under 107(c), we will
     require substantial additional information from petitioners. As
     with circuit-mode petitions discussed previously, we tentatively
     conclude that submitted information should include a compliance
     plan that will outline how the petitioner proposes to become CALEA
     compliant for packet-mode capabilities by specified dates, and that
     no date may be set later than two years after the date of the
     petition. Additionally, the petition must include the information
     described in Appendix F of this *Notice*, as well as a "due
     diligence" description of the petitioner's attempts to become CALEA
     compliant since November 19, 2001, *i.e*., the date mandated for
     packet-mode CALEA compliance by our September 28, 2001 Public
     Notice. This description should include a documented recital of
     negotiations with equipment manufacturers and third-party CALEA
     service providers, or other persuasive evidence that the petitioner
     actively and diligently searched for available CALEA-compliant
     solutions since November 19, 2001. We seek comment on this
     analysis.

     **(iii) Section 109(b) Petition Requirements**

104. Our reading of the statute and its legislative history indicates
     that Congress anticipated that section 109(b) would be used in
     extraordinary cases by carriers facing particularly high
     CALEA-related costs and difficulties.[^241] What burdens would
     exist for both the Commission and the industry, particularly
     smaller rural carriers, if many more entities are persuaded to file
     section 109(b) petitions? Although we have, to date, declined to
     construe section 109(b) in favor of making case-by-case
     determinations of submitted petitions, this approach might not make
     sense if hundreds of carriers were to decide to file section 109(b)
     petitions. Should we now set out more explicit guidelines governing
     such petitions? How should we construe and weigh the eleven
     evaluative criteria set out in that section? These criteria address
     various issues, including economic and national security concerns.
     We tentatively conclude that we need not weigh these criteria
     equally, and that, following the events of September 11, 2001, we
     should assign greater weight to national security and public
     safety-related concerns. We note that inquiry into such issues
     here, or in the context of discrete section 109(b) adjudicatory
     proceedings, could predictably involve highly sensitive information
     about LEA activities. We seek comment about how such information
     should be handled, particularly in the context of section 109(b)
     proceedings.

105. We note that section 109(b), unlike section 107(c), makes no
     reference to "available technology" in connection with a showing of
     what is and is not reasonably achievable. Consequently, we
     tentatively conclude that carriers may not assert the lack of
     available standards or solutions to support a showing under section
     109(b). Instead, carriers filing section 109(b) petitions will be
     expected to demonstrate active and sustained efforts at developing
     and implementing CALEA solutions for their operations, *i.e*.,
     regardless whether CALEA solutions for packet-mode are generally
     available. We tentatively conclude that we should require section
     109(b) petitioners to submit detailed information about discussions
     and negotiations with switch manufacturers, other equipment
     manufacturers, and third party CALEA service providers, both before
     and after the FBI announced the termination of the Flexible
     Deployment Program in connection with packet-mode technology. We
     tentatively conclude that unless we are persuaded that petitioners
     have engaged in sustained and systematic negotiations with
     manufacturers and third-party providers to design, develop, and
     implement CALEA solutions, we should reject submitted petitions.
     Regarding cost and other economic impact-related section 109(b)
     criteria, we tentatively conclude that petitioners must precisely
     identify the alleged costs of packet-mode CALEA compliance in
     connection with upgrading specifically identified network
     technologies and system architectures. To this end, petitioners
     must include copies of all offers, bids, and price lists negotiated
     with manufacturers and third party CALEA service providers that
     support their demonstrations of CALEA-related costs and associated
     impacts on customers. Additionally, petitioners must provide the
     information requested in Appendix E for a circuit-mode petition or
     Appendix F for a packet-mode petition. Again, we tentatively
     conclude that we should reject any section 109(b) petition that
     does not contain such documentation.[^242] Regarding petitioner
     showings about costs associated with packet-mode CALEA compliance
     generally, we direct parties' attention to the cost discussion in
     the *Second R&O*, including our determination that costs not
     directly related to CALEA compliance may not be included in such
     showings.[^243] We seek specific comment about appropriate
     protections for cost and other information that petitioners assert
     is proprietary or otherwise sensitive.[^244]

106. In the past, the Commission provided that section 107(c)
     petitioners would be afforded provisional two-year extensions
     pending Commission action on particular extension petitions.
     Because section 109(b) is not an extension provision but, rather,
     addresses who must pay for CALEA implementation, we do not propose
     similar treatment for section 109(b) petitions. We seek comment on
     our analysis of section 109(b), including all tentative
     conclusions.

     **c. The Alternative Extension Mechanism Proposed by Law
     Enforcement**

107. In its Petition, Law Enforcement asks the Commission to impose a
     new compliance regime consisting of standardized CALEA compliance
     benchmarks for packet services. Under this scheme, limited
     compliance extensions generally would be granted only if carriers
     agreed to meet the proposed benchmarks.[^245] In effect, Law
     Enforcement asks the Commission to adopt a packet-mode compliance
     plan that mimics the phased-in program we ordered in connection
     with the implementation of E911 service.[^246] We have received
     substantial comment opposing the Law Enforcement proposal.
     Commenters broadly assert that the proposed scheme is unsupported
     by the statute and, in fact, subverts those protections Congress
     expressly provides in sections 107(c) and 109(b).[^247] Commenters
     also attack the Law Enforcement proposal as impractical, because
     the proposed benchmarks do not reflect how CALEA standards and
     solutions are developed in the real world, or otherwise
     realistically address the particular difficulties associated with
     developing standards and solutions for packet-mode technologies and
     services.[^248]

108. At the outset, we note that the Commission's statutory authority to
     implement 9-1-1 nationwide differs substantially from that
     authority conveyed by CALEA. Law Enforcement asserts that its
     benchmark-driven proposal can be based upon section 229(a) of the
     Communications Act, which it interprets to give the Commission
     broad authority to adopt rules necessary to implement CALEA.[^249]
     We seek more extensive comment about the Law Enforcement benchmark
     proposal. Can section 229(a), or some other provision of the
     Communications Act or CALEA, be used to support the proposal?
     Assuming the Commission has the authority to mandate such a regime,
     would it tend to promote CALEA compliance? How difficult would it
     be to develop and administer such a regime, particularly with
     respect to packet-mode technologies and services?[^250] With
     respect to the differing characteristics of wireline, wireless, and
     other CALEA-obligated carriers? With respect to the differing
     regulation of these carriers? Are the specific benchmarks
     (including both tasks and due dates) identified by Law Enforcement
     appropriate and useful? What protections would extensions granted
     pursuant to such a regime provide? Is such a regime compatible with
     the continued availability of extensions and exemptions provided by
     sections 107(c) and 109(b)?

109. In recommending a benchmark regime that imposes uniform compliance
     dates upon all telecommunications carriers, the Petition assumes
     that all packet mode services are subject to CALEA, regardless of
     whether these services are deemed to be telecommunications services
     or information services under the Communications Act. How does our
     analysis of the applicability of CALEA to services deemed to be
     information services affect the benchmark/extension regime proposed
     by Law Enforcement? Are there alternative benchmark regimes, or
     other incentive-based programs, that might better promote CALEA
     compliance while satisfying the specific mandates of the CALEA
     statute?

110. We seek comment on these questions, and on any and all additional
     issues raised by the Petition regarding how to dispose of current
     and future extension petitions.

     **E. ENFORCEMENT OF CALEA**

111. In its Petition, Law Enforcement requests that the Commission
     establish rules that "specifically outline the types of enforcement
     action that may be taken against carriers and/or equipment
     manufacturers and support service providers that fail to comply
     with their general CALEA obligations" or fail to comply with
     established CALEA compliance benchmarks and deadlines.[^251]
     According to Law Enforcement, section 107(c) of CALEA,[^252] in
     conjunction with sections 229(a) and (d) of the Communications
     Act,[^253] require the Commission to enforce CALEA compliance
     deadlines[^254] and render the Commission the "appropriate agency"
     to enforce CALEA compliance generally.[^255] Law Enforcement states
     that the Commission has broad authority to establish rules as
     needed to implement CALEA, and enforcement is an inherent component
     of implementation.[^256] Law Enforcement contends that the
     "Enforcement Orders" provision set forth in section 108 of
     CALEA[^257] is "far less reliable" than a Commission notice of
     apparent liability because of certain limitations contained within
     section 108[^258] and because it is effectively unavailable by
     virtue of Commission-granted extensions of the compliance
     date.[^259] Law Enforcement states that the establishment of
     Commission rules to enforce CALEA is consistent with the
     Commission's enforcement of other public safety implementation
     mandates, such as E911.[^260]

112. The New York State Attorney General's Office supports Law
     Enforcement's request for the establishment of enforcement rules,
     stating that there "is no acceptable alternative in light of the
     industry's track record of delays in establishing compliance
     standards for existing and new technologies, failures to cooperate
     with law enforcement, and foot-dragging in deploying technology
     needed to assist law enforcement with court authorized
     intercepts."[^261]

113. Other commenters, however, maintain that there is no need or
     authority for the Commission to establish a separate CALEA
     enforcement scheme.[^262] According to commenters, a separate CALEA
     enforcement scheme would violate the statutory requirements of
     CALEA,[^263] would be duplicative and would be a potentially
     enormous drain on Commission resources.[^264] Commenters assert
     that under sections 108 and 201 of CALEA,[^265] Congress assigned
     the CALEA enforcement role to the federal courts, and strictly
     confined the courts' enforcement authority "under procedures and
     standards that are favorable to service providers."[^266]
     Commenters state that CALEA requires the Attorney General to bring
     a civil action in the appropriate district court to seek an order
     directing compliance.[^267] According to commenters, section
     229(a)'s[^268] general grant of authority does not authorize the
     Commission to ignore Congress' explicit delegation of CALEA
     enforcement power to the federal courts.[^269] Commenters also
     state that section 229(a) does not authorize the Commission to
     promulgate enforcement rules that directly apply to
     manufacturers.[^270] Instead, section 106(b) of CALEA gives
     enforcement powers to the Attorney General through the courts to
     ensure compliance with CALEA's obligations on manufacturers.[^271]

114. We consider whether, in addition to the enforcement remedies
     through the courts available to LEAs under section 108 of
     CALEA,[^272] the Commission may take separate enforcement action
     against telecommunications carriers, manufacturers and providers of
     telecommunications support services that fail to comply with CALEA.
     The Commission has broad authority to enforce its rules under the
     Communications Act. Section 229(a)[^273] provides broad authority
     for the Commission to adopt rules to implement CALEA and, unlike
     section 229(b),[^274] does not limit such rulemaking authority to
     common carriers. While the "penalties" provision of section 229(d)
     refers to CALEA violations "by the carrier,"[^275] nothing in
     section 229(d) appears to limit the Commission's general
     enforcement authority under the Communications Act.[^276] As such,
     it appears the Commission has general authority under the
     Communications Act to promulgate and enforce CALEA rules against
     carriers as well as non-common carriers. We seek comment on this
     analysis. We also seek comment on whether sections 108 and/or
     201[^277] impose any limitations on the nature of the remedy that
     the Commission may impose (*e.g.* injunctive relief) and whether
     section 106 imposes any limitations on the Commission's enforcement
     authority over manufacturers and support service providers.

115. Next, we seek comment on how the Commission would enforce the
     assistance capability requirements under section 103 of
     CALEA.[^278] To facilitate enforcement, we tentatively conclude
     that, at a minimum, we should adopt the requirements of section 103
     as Commission rules.[^279] We ask whether, given this tentative
     conclusion, the lack of Commission-established technical
     requirements or standards under section 107(b)[^280] for a
     particular technology would affect the Commission's authority to
     enforce section 103? How would the lack of publicly available
     technical requirements or standards from a standard-setting
     organization impact the Commission's authority/ability to enforce
     section 103?[^281] In addition, we ask whether there are other
     provisions of CALEA, such as section 107(a)'s safe harbor
     provisions, that the Commission should adopt as rules in order to
     effectively enforce CALEA? How would the upgrade of a standard by a
     standard-setting organization impact the application of section
     107(a)'s safe harbor provision?

116. We believe it is in the public interest for covered carriers to
     become CALEA compliant as expeditiously as possible and recognize
     the importance of effective enforcement of Commission rules
     affecting such compliance. We seek comment on whether the
     Commission's general enforcement procedures are sufficient for
     purposes of CALEA enforcement. The Commission has broad authority
     to enforce its rules under the Communications Act. It can, for
     example, issue monetary forfeitures and cease and desist orders
     against common carriers and non-common carriers alike for violation
     of Commission rules.[^282] Is this general enforcement authority
     sufficient or should we implement some special procedures for
     purposes of CALEA enforcement? Would an established enforcement
     scheme expedite the CALEA implementation process? We seek comment
     on any other measures we should take into consideration in deciding
     how best to enforce CALEA requirements.

     **F. COST AND COST RECOVERY ISSUES**

117. The modifications and upgrades required under the J-Standard and
     punch list will potentially require significant capital
     expenditures on the part of carriers. Moreover, carriers face a
     future of recurring CALEA-related costs given that, as technology
     develops, telecommunications networks will be upgraded and modified
     as part of normal business operations. These upgrades will require
     in turn the implementation of new CALEA compliant technology. Many
     CALEA-related costs associated with upgrading equipment and
     facilities deployed prior to January 1995 were paid through a \$500
     million appropriations fund established by Congress to implement
     CALEA.[^283] It has been reported that DoJ/FBI has nearly exhausted
     that fund to bring pre-1995 equipment and facilities into
     compliance with CALEA.[^284] While no solid cost estimates for
     CALEA implementation of post-January 1, 1995 equipment and
     facilities have yet been generated, the need for significant
     capital expenditures associated with CALEA are expected to continue
     into the future.

118. In this section, we seek comment on various cost determination and
     recovery issues that different telecommunications carriers face in
     complying with CALEA. We seek comment on whether individual
     carriers should bear responsibility for the costs of CALEA
     compliance. We further seek comment on specific jurisdictional
     issues, depending on whether carriers provide wireline or wireless
     service, that may affect our determinations concerning what
     responsibilities they should have in bearing those costs. We invite
     commenters to raise any issues related to those we address below.
     In addressing the issues raised below, commenters should afford
     special attention to providers that the Commission may determine
     are covered by CALEA but operate in an unregulated environment. Do
     such firms require guidance in the recovery of CALEA costs from
     end-users? What would be the competitive effect of such guidance?

119. In its Petition, Law Enforcement contends that "there continues to
     be dispute concerning who bears financial responsibility for
     various costs associated with CALEA implementation."[^285]
     Accordingly, Law Enforcement requests the Commission to establish
     rules that (1) confirm "carriers bear the sole financial
     responsibility for development and implementation of CALEA for post
     January 1, 1995 communications equipment, facilities and
     services;" (2) permit carriers to recover the cost of post-January
     1, 1995 CALEA requirements from their customers; and (3) clarify
     the methodology for determining carrier CALEA intercept
     provisioning costs and who bears financial responsibility for such
     costs.[^286] Law Enforcement contends that permitting carriers to
     include their CALEA implementation costs in their administrative
     intercept provisioning costs would not only violate Title III of
     the Omnibus Crime Control and Safe Streets Act of 1968 ("OCCSSA"),
     but would also make it increasingly cost-prohibitive for LEAs to
     conduct intercepts. Law Enforcement argues that, although Title III
     of the OCCSSA provides for carriers to be compensated for their
     costs associated with provisioning a court-authorized intercept,
     nothing in either Title III or CALEA authorizes carriers to include
     in such provisioning costs their CALEA implementation costs.[^287]

120. Some commenters insist that CALEA costs for post-January 1, 1995
     technologies are "far-reaching" and "should not be borne
     exclusively by a carrier or its customer."[^288] Similarly,
     BellSouth argues that Congress did not intend "to tax the
     communications industry or consumers with all the costs of building
     and maintaining the most effective and efficient surveillance
     system envisioned by law enforcement."[^289] Some commenters argue
     that the Commission should adopt rules permitting covered carriers
     to pass on to subscribers the costs of CALEA compliance.[^290]
     Other carriers, however, remind the Commission that passing the
     costs along to customers would place unique burdens on the
     customers of small, rural carriers,[^291] and other niche groups
     such as providers of broadband access to small hospitality
     properties.[^292]

121. Our discussion here will address cost and cost recovery in
     connection with both circuit-mode and packet-mode solutions. In
     order to better understand the dimensions of CALEA-related costs
     and their impact on carriers and other entities subject to CALEA,
     we seek comment about the nature and extent of circuit-mode
     CALEA-related costs generally, as well as packet-mode costs.[^293]

122. We also seek comment on how our analysis of cost and cost recovery
     issues applies to carriers that are deemed to be telecommunications
     carriers pursuant to CALEA section 102(8)(B)(ii).[^294] Commenters
     should address whether costs or cost recovery methods should differ
     for carriers subject to Title II of the Communications Act and
     carriers deemed to be telecommunications carriers pursuant to CALEA
     section 102(8)(B)(ii) that otherwise operate in an unregulated
     environment for purposes of the Communications Act.

###  1. Cost Recovery for Post-January 1, 1995 CALEA Compliance {#cost-recovery-for-post-january-1-1995-calea-compliance .unnumbered}

123. Law Enforcement contends that Congress "clearly" places the
     financial burden of post-January 1, 1995 CALEA implementation on
     carriers and not LEAs.[^295] Law Enforcement requests that the
     Commission establish rules "confirming" that carriers bear the
     "sole financial responsibility" for post-January 1, 1995 CALEA
     implementation, unless otherwise specified by the Commission in the
     context of a carrier-specific CALEA section 109(b) petition.[^296]
     Related to this request, Law Enforcement asks the Commission to
     "eliminate the issues of compliance costs as a basis for delayed
     compliance or non-compliance" by establishing rules permitting
     carriers to recover CALEA implementation costs from their
     customers.[^297]

124. Section 229(a) of the Communications Act requires the Commission to
     "prescribe such rules as are necessary" to implement CALEA.[^298]
     Section 229(e) of the Communications Act also permits a common
     carrier to petition the Commission to adjust charges, practices,
     classifications, and regulations to recover costs expended for
     making modifications to equipment, facilities, or services pursuant
     to the requirements of section 103 of CALEA.[^299]

125. CALEA itself contains cost recovery provisions. CALEA section 109's
     cost recovery provisions allow recovery from the federal government
     in relation to three specific areas of costs:[^300] (1) the costs
     of developing the modifications for equipment deployed *on or
     before* January 1, 1995, (2) the costs of providing the
     capabilities for equipment deployed *after* January 1, 1995, but
     only where the Commission finds compliance is not "reasonably
     achievable," and (3) the costs of providing the "capacities"
     required under section 104 of CALEA, a subject that is not at issue
     here.[^301] CALEA section 109 provides for different cost treatment
     for equipment and facilities deployed *on or before* January 1,
     1995 and that which is deployed *after* January 1, 1995.[^302]
     CALEA section 109 places financial responsibility on the federal
     government for CALEA implementation costs related to equipment
     deployed *on or before* January 1, 1995.[^303] Where the federal
     government refuses to pay for such modifications, a carrier's
     pre-1995 deployed equipment and facilities will be considered CALEA
     compliant until such equipment or facility "is replaced or
     significantly upgraded or otherwise undergoes major modification"
     for purposes of normal business operations.[^304] However, for
     CALEA implementation costs associated with equipment deployed
     *after* January 1, 1995, CALEA section 109 places financial
     responsibility on the telecommunications carriers unless the
     Commission determines compliance is not "reasonably
     achievable."[^305] Based on CALEA's delineation of responsibility
     for compliance costs, we tentatively conclude that carriers bear
     responsibility for CALEA development and implementation costs for
     post-January 1, 1995 equipment and facilities. We seek comment on
     this analysis. Are specific rules regarding carriers'
     responsibility for CALEA implementation costs for post-January 1,
     1995 equipment and facilities necessary?

126. In the *Second R&O*, the Commission stated an expectation that
     "carriers will become CALEA compliant in the course of general
     network upgrades and will recover any additional cost of CALEA
     compliance through their normal charges."[^306] Did the Commission
     accurately forecast a carrier's ability to recover such costs? Is
     it now necessary for the Commission to adopt rules specifically
     allowing carriers to recover CALEA compliance costs from their
     customers?[^307] Commenters requesting that the Commission adopt
     such rules should describe the scope and level of detail that would
     be necessary from any new cost recovery rules.

127. We also seek comment on other cost recovery options that could
     reduce CALEA-related burdens otherwise imposed on carriers and
     their customers. Given the public benefits of CALEA-supported
     surveillance of criminals and terrorists, does it make sense to
     consider cost recovery devices that more equitably spread costs
     among the general public? For example, should CALEA costs be
     recovered directly from telecommunications and other consumers by
     means of a Commission-mandated, flat monthly charge similar to the
     current subscriber line charge ("SLC")?[^308] Does the Commission
     have authority to impose such a charge? How would such a charge be
     developed? Our experience to date evaluating *circuit-based*
     CALEA-related costs indicates that developing an appropriate cost
     analysis for packet capabilities could be complex and difficult. We
     seek comment on how to assess the scope of CALEA-related costs in
     this proceeding. We ask commenters to submit cost calculations and
     analysis, and to identify any conditions or factors that may affect
     our ability to determine the true scope of CALEA-related costs.

128. We note here that wireless carriers have a statutorily prescribed
     rate paradigm that is different from that for wireline carriers.
     Section 332(c)(3)(A) of the Communications Act precludes state
     regulation of the rates charged by any commercial mobile
     service.[^309] Further, the Commission has found that this statute
     expresses a clear Congressional intent to preempt the states from
     any rate regulation for CMRS carriers.[^310] Thus, unlike LECs,
     which are subject to state-based tariff regulation, CMRS carriers
     could collect directly from their customer base on a competitive
     market basis.

129. Given this different statutory approach for regulation of CMRS
     rates, we seek comment on whether a national surcharge scheme,
     similar to the one that we request comment on above, is feasible
     for wireless carriers in their efforts to meet CALEA requirements.
     In order for the Commission to be able to make an informed
     decision, we invite commenters, including those from industry, the
     economic community, and state regulatory groups, to address
     possible rationales for such a scheme for wireless carriers
     regarding cost recovery to implement CALEA capabilities for the
     application of packet mode technologies, particularly with regard
     to considering the potential cost factors involved.  We also
     request comment on the relevant methodologies to estimate the
     magnitude of those costs.

130. In the alternative, we request comment on whether the Commission
     would need to undertake a specific forbearance analysis in view of
     the public interest concerns underlying CALEA.[^311] In addition,
     although section 332(c)(3) of the Communications Act prohibits
     states from regulating CMRS rates, it allows states to regulate
     "other terms and conditions."[^312] We seek comment on whether,
     pursuant to this exception, states may expressly provide for or
     preclude the recovery of CALEA compliance costs, *e.g.*, intercept
     costs that have been set according to state tariff.[^313]

131. We seek specific comment about how cost and cost-recovery issues
     connected with CALEA affect small and rural carriers. Should we
     adopt specific rules and policies to help ensure that such carriers
     can become CALEA compliant? Is it sufficient that such carriers
     have recourse to the CALEA section 109(b) petition process to seek
     funding from the Attorney General? Would exclusive reliance on
     CALEA section 109(b) tend to encourage hundreds of rural carriers
     to file such petitions? If the Attorney General finds, in such a
     case, that it cannot pay for CALEA compliance upgrades, successful
     petitioners would be deemed CALEA compliant. Is this result
     desirable from the perspective of providing for the reasonable
     needs of LEAs to engage in intercept activities in rural areas?

###  2. Intercept Provisioning Costs {#intercept-provisioning-costs .unnumbered}

132. We also seek comment on whether we should distinguish carrier
     recovery of CALEA-incurred capital costs generally from recovery of
     specific intercept-related costs. As a general rule, LEAs must
     compensate carriers for their costs associated with provisioning a
     court-authorized intercept.[^314] In analyzing the cost
     effectiveness of implementation of four CALEA punch list items in
     the context of a CALEA section 107(b) proceeding, the Commission
     noted that several aspects mitigated the cost burden on carriers,
     including the fact that "carriers can recover at least a portion of
     their CALEA software and hardware costs by charging to LEAs, for
     each electronic surveillance order authorized by CALEA, a fee that
     includes recovery of capital costs, as well as recovery of the
     specific costs associated with each order."[^315] Law Enforcement
     contends that carriers passing along their capital costs in this
     way "constitutes an improper shifting of the CALEA-allocated cost
     burden from industry to law enforcement not authorized or
     contemplated by CALEA."[^316] Law Enforcement alternatively
     contends that even if the Commission did have the authority to
     allow recovery of capital costs associated with intercept
     provisioning, this constitutes a new rule that was not subject to
     notice and comment and therefore violates the Administrative
     Procedure Act ("APA").[^317]

133. At the outset, we note that our prior observation concerning a
     carrier's ability to recover a portion of its CALEA capital costs
     through individual wiretap charges was made without the benefit of
     a full and complete record compiled in response to a request for
     comment. Given its significance to both LEAs and industry, we seek
     to develop a full record in this proceeding on this very important
     aspect of cost recovery. We seek comment on the costs that can be
     included in intercept provisioning costs and the entities that
     should bear financial responsibility for those costs. As Law
     Enforcement acknowledges,[^318] Title III of the OCCSSA generally
     authorizes carriers to recover intercept provisioning costs from
     law enforcement.[^319] We seek comment on whether CALEA limits the
     available cost recovery for intercept provisioning, and on whether
     carriers should be allowed to adjust their charges for such
     intercept provisioning to cover costs for CALEA-related services,
     which would include CALEA-related intercept provisioning charges.
     We seek comment as to whether recovery for capital costs associated
     with intercept provisioning should be different in the circuit-mode
     and packet-mode contexts, and if so, why.

134. In the context of wireless services, we have recognized that
     larger, nationwide carriers are better able to implement regulatory
     requirements than smaller, rural carriers.[^320] We seek comment on
     whether those with large subscriber bases have more capability to
     spread CALEA compliance costs over all of their customers to a more
     economical degree than those with a smaller subscriber base. If so,
     would the result thereby narrow the number of smaller carriers, for
     instance Tier III wireless carriers, that could use a cost recovery
     approach pursuant to CALEA section 109? What would be the impact on
     such smaller carriers and administration of a cost recovery program
     pursuant to this CALEA provision? Moreover, how do we define the
     market and cost parameters for CALEA compliance in order to make
     determinations that are reasonably based on carriers' capabilities
     and the scope of their particular markets? We seek comment on these
     and any other concerns related to cost recovery for wireless
     carriers deploying packet technologies.

135. How should we treat such costs for broadband services offered on a
     commercial basis by cable modem service providers, wireless ISPs
     and broadband over powerline operators that operate on a totally
     unregulated basis under Part 15 of the Commission's rules?

###  3. Jurisdictional Separations Implications {#jurisdictional-separations-implications .unnumbered}

136. Section 229(e)(3) of the Communications Act requires the Commission
     to convene a Federal-State Joint Board[^321] "to recommend
     appropriate changes to Part 36 of the Commission's rules with
     respect to recovery of costs \[related to CALEA compliance\]
     pursuant to charges, practices, classifications, and regulations
     under the jurisdiction of the Commission."[^322] In 1997, the
     Commission referred CALEA cost recovery issues to the Federal-State
     Joint Board on Jurisdictional Separations (Federal-State
     Separations Joint Board).[^323]

137. When the Commission referred CALEA cost recovery issues to the
     Federal-State Separations Joint Board in 1997, parties were focused
     on cost recovery issues related to deployment of CALEA capabilities
     in circuit-switched networks of telecommunications carriers;
     standards for CALEA implementation had not yet been developed.
     Since then, a number of significant technological, marketplace, and
     regulatory developments have taken place, including the development
     of standards for circuit-mode and packet-mode CALEA implementation
     and widespread deployment of packet-switching capabilities.
     Meanwhile, the Federal-State Separations Joint Board recommended,
     and the Commission adopted, an interim freeze on further
     modifications to the Commission's jurisdictional separations
     rules.[^324] The separations freeze went into effect on July 1,
     2001 and is scheduled to end on June 30, 2006, absent further
     action by the Commission.[^325]

138. As a result of the separations freeze, the Federal-State
     Separations Joint Board has not had the opportunity to consider
     fully CALEA cost recovery issues and their implications for the
     Commission's jurisdictional separations rules. We therefore refer
     to the Federal-State Separations Joint Board the following
     CALEA-related cost recovery issues: (i) whether costs for
     circuit-based capabilities should be separated, and if so, how the
     associated costs and revenues should be allocated for
     jurisdictional separations purposes; (ii) whether costs for
     packet-mode capabilities should be separated, and if so, how the
     associated costs and revenues should be allocated for
     jurisdictional separations purposes. We emphasize that our
     separations rules only apply to incumbent LECs under the
     Communications Act, and do not apply to entities that may be deemed
     telecommunications carriers under CALEA. As such, the Federal-State
     Separations Joint Board shall focus on the foregoing questions only
     insofar as they pertain to entities subject to jurisdictional
     separations.

139. In addition, we ask parties to refresh the record on the CALEA
     issues identified in the *Separations NPRM*, *i.e.*, whether costs
     should be allocated in a new CALEA-specific category or in
     previously-existing categories, whether revenues received from the
     Attorney General should be allocated in a particular manner (and if
     so, how), and whether CALEA-related revenues could be allocated to
     the jurisdictions based on relative-use factors derived from the
     relative electronic surveillance requirements of federal, state,
     and local LEAs.[^326] Finally, because of the national importance
     of CALEA issues, we request that the Federal-State Separations
     Joint Board issue its recommended decision no later than one year
     from the release of this *Notice*.

     **G. EFFECTIVE DATES OF NEW RULES**

140. If the Commission ultimately decides, as discussed in this
     *Notice*, that broadband access providers or additional entities
     are subject to CALEA, entities that heretofore have not been
     subject to CALEA will have to comply with its requirements. Thus,
     entities previously identified as information service providers
     under the Commission's previous decisions[^327] would be subject to
     CALEA and would have to comply with various requirements, including
     the assistance capability requirements in CALEA section 103, the
     capacity requirements in CALEA section 104, and the system security
     requirements in CALEA section 105 and in section 229(b) of the
     Communications Act.[^328]

141. Carriers already subject to CALEA either are in compliance with its
     requirements or have filed petitions to extend their compliance
     date with the section 103 assistance capability requirements, as
     discussed in Section III.D. of this *Notice*. Newly-identified
     entities, on the other hand, will need a reasonable amount of time
     to come into compliance with all relevant CALEA requirements. Law
     Enforcement addressed compliance deadlines for section 103 within
     the context of its request that the Commission establish benchmarks
     and deadlines for section 107(c) extensions, but it is not clear
     from the petition if Law Enforcement was proposing this scheme for
     all carriers subject to CALEA, including newly-identified carriers
     as a result of this rulemaking, or only those who already had filed
     extension petitions*.* Law Enforcement proposes that carriers come
     into compliance with CALEA section 103 within 15 months of a
     Commission-issued Public Notice that explains the policies and
     procedures for the extension process.[^329] It did not address
     compliance deadlines for CALEA sections 104 and 105 and section
     229(b) of the Communications Act.

142. Many commenters argue that the proposed benchmarks for CALEA
     section 107(c) extensions are not reasonable. They point out, for
     example, that manufacturers have not yet devised CALEA solutions
     because not all packet standards have been finalized; that, in the
     absence of standardized solutions, the benchmarks do not provide
     enough time for manufacturers and carriers to devise individualized
     solutions; and that the benchmarks do not provide carriers with
     enough time to install and deploy solutions.[^330] No commenters
     addressed compliance deadlines for other CALEA requirements.

143. If the Commission ultimately decides that entities that heretofore
     have not been subject to CALEA will have to comply with its
     requirements, we seek comment on what would be a reasonable amount
     of time for those entities to come into compliance with sections
     103 and 105 of CALEA.[^331] Should newly-identified entities either
     come into compliance with or seek relief from section 103
     requirements within 90 days, as we propose for carriers that have
     filed section 107(c) petitions?[^332] Or should newly-identified
     entities have 15 months to come into compliance with section 103,
     as Law Enforcement suggests, or is some other amount of time
     reasonable? Regarding compliance with CALEA section 105 and section
     229(b) of the Communications Act, should newly-identified carriers
     comply with the system security requirements previously adopted by
     the Commission within 90 days, which was the amount of time the
     Commission provided when it adopted those rules, or is some other
     amount of time reasonable? Commenters should address factors that
     would support their suggestions for sections 103, 105 and 229(b)
     compliance deadlines.

     **IV. DECLARATORY RULING ON PUSH-TO-TALK SERVICES**

##  A. BACKGROUND {#a.-background .unnumbered}

144. In this section, we address the request of Law Enforcement to
     reaffirm the Commission's determination in the *Second R&O* that
     wireless push-to-talk "dispatch" services are subject to CALEA
     requirements.[^333] Law Enforcement asserts that an increasing
     number of wireless carriers offer this service without admitting
     that they have related CALEA obligations.

145. Several parties support Law Enforcement's position.[^334] Verizon
     Wireless submits that push-to-talk voice services offered by
     telecommunications carriers, which use packet mode technologies
     such as its own push-to-talk service, are covered by CALEA.[^335]
     Nextel supports a clarification that all push-to-talk "dispatch"
     like services provide CALEA-compliant solutions as quickly as
     possible.[^336] On the other hand, Sprint asserts that a decision
     that a particular push-to-talk "dispatch" service was subject to
     CALEA requires a factual determination as to whether such offering
     meets the necessary criteria, *i.e.*, that it is offered in
     conjunction with interconnected service, to render it subject to
     CALEA.[^337] Consequently, Sprint argues that because Law
     Enforcement does not submit facts for the Commission to make such a
     determination as to any push-to-talk service, the Commission cannot
     declare that all such services should be subject to CALEA.[^338]

##  B. DISCUSSION {#b.-discussion .unnumbered}

146. We find that the situation presented by CMRS push-to-talk
     "dispatch" service warrants further clarification, and therefore,
     we are issuing this Declaratory Ruling. Although Law Enforcement
     does not specifically request such a ruling, we clarify that CMRS
     carrier offerings of push-to-talk service that are offered in
     conjunction with interconnected service to the PSTN, but may use
     different technologies, are subject to CALEA requirements.

147. Following the Commission's treatment of push-to-talk "dispatch"
     service offered by CMRS carriers in the *Second R&O*, it appears
     that CMRS providers are in the process of deploying new
     technological advances in offering the service. For instance,
     Verizon Wireless generally expresses that it plans to offer its
     push-to-talk "dispatch" service over its 1X Code Division Multiple
     Access ("CDMA") packet data network.[^339] In addition, Sprint
     asserts that push-to-talk "dispatch" service over "closed"
     networks, which the Commission previously found was not subject to
     CALEA, requires a rulemaking proceeding to determine whether it has
     become a replacement for a substantial portion of the local
     exchange service once provided by incumbent LECs.[^340]

148. We note at the outset, that pursuant to section 1.2 of the
     Commission's rules, the Commission has authority to issue on its
     own motion ". . . a declaratory ruling terminating a controversy or
     removing an uncertainty."[^341] We find that the record of comments
     in response to Law Enforcement indicates that developments in
     push-to-talk "dispatch" services are complicating how these
     services should be treated for purposes of applying CALEA
     requirements. Consequently, we find that further clarification is
     necessary.

149. The *Second R&O* addressed the dichotomy between push-to-talk
     "dispatch" services that are interconnected to the PSTN and those
     that are not. The Commission focused on this difference in the
     context of first concluding that CMRS providers should be
     considered telecommunications carriers for the purposes of CALEA.
     The Commission found that section 102(8)(B)(i) of CALEA, defining
     "telecommunications carrier" as including "a person or entity
     engaged in providing commercial mobile service (as defined in
     section 332(d) of the \[Communications Act\])" requires that
     conclusion.[^342] The Commission further recognized that the
     definition of commercial mobile service requires interconnected
     service.[^343] Thus, if services such as "traditional" SMR provide
     interconnection to the PSTN, the Commission determined that they
     satisfy the definition of CMRS and thus, are subject to CALEA. The
     Commission further found the same definitional approach holds for
     push-to-talk "dispatch" service, because if it is offered as an
     interconnected service, "it is a switched service functionally
     equivalent to a combination of speed dialing and conference
     calling."[^344] If the push-to-talk "dispatch" service otherwise
     does not interconnect to PSTN, the Commission found that it is not
     subject to CALEA.[^345]

150. We find that this approach continues to be applicable to CMRS
     offered push-to-talk services that may use different technologies,
     such as a packet mode network based on more advanced wireless
     protocols. The Commission noted in the *Second R&O* that CALEA is
     technology neutral, and "\[t\]hus, the choice of technology that a
     carrier makes when offering common carrier services does not change
     its obligations under CALEA."[^346] We do not agree with Sprint's
     contention that for each offering of push-to-talk "dispatch"
     service by CMRS carriers, a factual determination is required to
     determine whether the carrier must comply with CALEA. We also note
     that Verizon Wireless recognizes its CALEA responsibilities for its
     CMRS push-to-talk service, based on the application of its CDMA
     packet data network.[^347] We find that whether a CMRS carrier's
     push-to-talk service offering is subject to CALEA depends on the
     regulatory definition and functional characteristics of that
     service and not on the particular technology the carrier chooses to
     apply in offering it. Therefore, we conclude that regardless of
     what newer technologies a CMRS carrier may use in its offering of
     push-to-talk "dispatch service," it continues to be subject to the
     requirements of CALEA, if the required definitional element for
     CMRS service is met, *i.e.*, the delivery of the push-to-talk
     service is offered in conjunction with interconnected service to
     the PSTN.

151. On the other hand, we reiterate that if the push-to-talk service is
     limited to a private or "closed" network, and is not offered in
     conjunction with interconnected service to the PSTN, then,
     generally, it remains not subject to CALEA. We qualify this
     approach, however, recognizing that what has been termed "private
     dispatch services" may be developed or implemented in a manner that
     raises issues pertaining to the Substantial Replacement
     Provision.[^348] For example, an entity might deploy a seemingly
     "private" or "closed" push-to-talk services that may satisfy all
     three prongs of the Substantial Replacement Provision such that
     this service would be subject to CALEA. We find that such instances
     are within the scope of the *Notice* above, and commenters should
     address them in that context.

**V. PROCEDURAL MATTERS**

**A. INITIAL REGULATORY FLEXIBILITY ANALYSIS**

152. As required by the Regulatory Flexibility Act, *see* 5 U.S.C. §
     603, the Commission has prepared an Initial Regulatory Flexibility
     Analysis ("IRFA") of the possible significant economic impact on
     small entities of the proposals suggested in this document. The
     IRFA is set forth in Appendix B. Written public comments are
     requested on the IRFA. These comments must be filed in accordance
     with the same filing deadlines as comments filed in this *Notice*,
     provided below in Section V.D. Comments must have a separate and
     distinct heading designating them as responses to the IRFA.

**B. PAPERWORK REDUCTION ACT**

153. This document contains proposed new information collection
     requirements. If these proposals are finalized in a Report and
     Order, the Commission, as part of its continuing effort to reduce
     paperwork burdens, will invite the general public and the Office of
     Management and Budget to comment on the information collection
     requirements contained in that Report and Order, as required by the
     Paperwork Reduction Act of 1995, Public Law 104-13.

## C. *EX PARTE* RULES  {#c.-ex-parte-rules .unnumbered}

154. This is a permit‑but‑disclose notice and comment rule making
     proceeding. *Ex parte* presentations are permitted, except during
     the Sunshine Agenda period, provided they are disclosed as provided
     in the Commission\'s rules. *See generally* 47 C.F.R. §§ 1.1202,
     1.1203, and 1.2306(a).

## D. COMMENTS {#d.-comments .unnumbered}

155. Pursuant to sections 1.415 and 1.419 of the Commission\'s rules, 47
     C.F.R. §§ 1.415, 1.419, interested parties may file comments on or
     before **\[45 days from date of publication in the Federal
     Register\]**, and reply comments on or before **\[75 days from date
     of publication in the Federal Register\]**. Comments may be filed
     using the Commission\'s Electronic Comment Filing System ("ECFS")
     or by filing paper copies. *See Electronic Filing of Documents in
     Rulemaking Proceedings*, 63 Fed. Reg. 24121 (1998).

156. Comments filed through the ECFS can be sent as an electronic file
     via the Internet to http://www.fcc.gov/e‑file/ecfs.html. Generally,
     only one copy of an electronic submission must be filed. If
     multiple docket or rulemaking numbers appear in the caption of this
     proceeding, however, commenters must transmit one electronic copy
     of the comments to each docket or rulemaking number referenced in
     the caption. In completing the transmittal screen, commenters
     should include their full name, U.S. Postal Service mailing
     address, and the applicable docket or rulemaking number. Parties
     may also submit an electronic comment by Internet e‑mail. To get
     filing instructions for e‑mail comments, commenters should send an
     e‑mail to ecfs@fcc.gov, and should include the following words in
     the body of the message, "get form \<your e‑mail address." A sample
     form and directions will be sent in reply. Parties who choose to
     file by paper must file an original and four copies of each filing.
     If more than one docket or rulemaking number appear in the caption
     of this proceeding, commenters must submit two additional copies
     for each additional docket or rulemaking number.

157. 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). The Commission\'s contractor,
     Best Copy and Printing, Inc., will receive hand‑delivered or
     messenger‑delivered paper filings for the Commission\'s Secretary
     at 236 Massachusetts Avenue, N.E., Suite 110, Washington,
     D.C. 20002. The filing hours at this location are 8:00 a.m. to 7:00
     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, D.C. 20554. All filings must be
     addressed to the Commission\'s Secretary, Office of the Secretary,
     Federal Communications Commission.

**E. CONTACT PERSONS**

158. For further information concerning this rule making proceeding,
     contact the Office of Engineering and Technology's Rodney Small at
     (202) 418‑2452 (<Rodney.Small@fcc.gov>) or Geraldine Matise
     at (202) 418-2322 (<Geraldine.Matise@fcc.gov>).

# VI. ordering clauses {#vi.-ordering-clauses .unnumbered}

159. Accordingly, IT IS ORDERED that pursuant to sections 1, 4(i), 7(a),
     229, 301, 303, 332, and 410 of the Communications Act of 1934, as
     amended, and sections 103, 106, 107, and 109 of the Communications
     Assistance for Law Enforcement Act, 47 U.S.C. §§ 151, 154(i),
     157(a), 229, 301, 303, 332, 410, 1002, 1005, 1006, and 1008, the
     NOTICE OF PROPOSED RULEMAKING AND DECLARATORY RULING is hereby
     ADOPTED.

160. It IS FURTHER ORDERED that, pursuant to section 410(c) of the
     Communications Act of 1934, 47 U.S.C. § 410(c), the Federal-State
     Joint Board on Jurisdictional Separations is requested to review
     the CALEA cost recovery issues set forth in paragraph 138 of the
     NOTICE OF PROPOSED RULEMAKING AND DECLARATORY RULING and to provide
     recommendations to the Commission.

161. IT IS FURTHER ORDERED that the Joint Petition for Expedited
     Rulemaking, filed by the Department of Justice, Federal Bureau of
     Investigation, and Drug Enforcement Administration on March 10,
     2004, IS GRANTED TO THE EXTENT INDICATED HEREIN.

162. IT IS FURTHER ORDERED that the Commission's Consumer Information
     and Governmental Affairs Bureau, Reference Information Center,
     SHALL SEND a copy of this NOTICE OF PROPOSED RULEMAKING AND
     DECLARATORY RULING, including the Initial Regulatory Flexibility
     Analysis, to the Chief Counsel for Advocacy of the Small Business
     Administration.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

**APPENDIX A**

**COMMENTERS TO THE LAW ENFORCEMENT PETITION**

[Comments]{.underline}

Alliance for Telecommunications Industry Solutions

American Association of Community Colleges, et al.

American Civil Liberties Union

Anchorage (Alaska) Police Department

Arapahoe County (Colorado) Sheriff's Office

AT&T Corp.

Michael Attili

Baltimore County Police Department

BellSouth Corporation

Ren Bucholz

Buchanan County (Virginia) Office of the Sheriff

Butler County (Pennsylvania) District Attorneys Office

Canadian Association of Chiefs of Police

Cape May Prosecutor's Office

Cellular Telecommunications and Internet Association

Center for Democracy & Technology

City of Alexandria, Virginia Department of Police

Charlotte-Mecklenburg (Virginia) Police Department

City of Virginia Beach, Virginia Department of Police

Robert Collinge

Concerned CALEA Compliant Carriers

Conference America

County of New York District Attorney

Covad Communications

Earthlink, Inc.

Electronic Frontier Foundation

Electronic Privacy Information Center

Global Crossing North America, Inc.

Honolulu Police Department

Hotel Internet Technology

Illinois State Police

Information Technology Industry Council

International Association of Chiefs of Police

Internet Commerce Coalition

ISP CALEA Coalition

King County (Washington) Sheriff's Office

Kitsap County (Washington) Sheriff's Office

Leap Wireless International, Inc.

Los Angeles County Regional Criminal Information Clearinghouse

Los Angeles County's Sheriff's Department

Madisonville (Texas) Police Department

Major Cities Chiefs Association

Major Counties Sheriffs' Association

Maryland State Police

Maryland Office of the Attorney General

Keith R. McCall

Meredith, New Hampshire Police Department

Metropolitan Police Department of Nashville and Davidson County
(Tennessee)

National District Attorneys Association

National Narcotic Officers Association Coalition

National Sheriffs\' Association

National Telecommunications Cooperative Association

New Hampshire Department of Safety

New Jersey Division of Criminal Justice

New Jersey State Police

New York State Attorney General's Office

New York State Police

Oklahoma State Bureau of Narcotics and Dangerous Drug Control

Philadelphia (Pennsylvania) County Office of the District Attorney

Pittsburgh Bureau of Police

Police Executive Research Forum

Privacilla.org

Rockland County (New York) District Attorney's Office

Rural Iowa Independent Telephone Association

Salt Lake County (Utah) District Attorney's Office

San Bernardino County (California) Police Department

San Bernardino County (California) Sheriff's Department

Satellite Industry Association

SBC Communications, Inc.

Shelby County Indiana Sheriff's Department

Skype Technologies, S.A.

Sprint Corporation

Telecommunications Industry Association

Tennessee Bureau of Investigation

Texas Department of Public Safety

Top Layer Networks, Inc.

Town of Wells (Maine) Police Department

VeriSign, Inc

Voices on the Net Coalition

Uinta County (Wyoming) Sheriff's Office

United Power Line Council

United States Telecom Association

Verizon

Warriner, Gesinger & Associates, LLC

Westbrook (Maine) Police Department

WorldCom, Inc. d/b/a/ MCI

Also, more than 2000 1-page form letters were filed opposing the
Petition.

[Reply Comments]{.underline}

8 x 8, Inc.

American Cable Association, Inc.

Arkansas, Illinois, Iowa, and Oklahoma Rural Telephone Companies

Center for Democracy & Technology

Cisco Systems, Inc

Department of Justice, Federal Bureau of Investigation

Earthlink, Inc.

Electronic Frontier Foundation

Industry and Public Interest

International Association of Chiefs of Police, Major Cities Chiefs
Association, National Sheriffs\' Association, Major County Sheriffs\'
Association

Level 3 Communications, LLC

National Association of State Utility Consumer Advocates

National Cable & Telecommunications Association

Net2Phone, Inc.; Net2Phone Global Services, LLC; and Net2Phone Cable
Telephony, LLC

New York State Attorney General's Office

Nextel Communications, Inc.

Rural Cellular Association

Skype Technologies, S.A.

Southern Communications, Services, et al.

Telecommunications Industry Association

T-Mobile USA, Inc.

Time Warner Telecom, Inc.

United States Cellular Corporation

United States Telecom Association

VeriSign, Inc

Verizon Wireless

Vonage Holdings Corp.

**APPENDIX B**

**INITIAL REGULATORY FLEXIBILITY ANALYSIS**

As required by the Regulatory Flexibility Act of 1980, as amended
("RFA"),[^349] the Commission has prepared this Initial Regulatory
Flexibility Analysis ("IRFA") of the possible significant economic
impact on a substantial number of small entities by the policies and
rules proposed in this *Notice of Proposed Rule Making* ("*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 *Notice* provided above in paragraph 155. The
Commission will send a copy of the *Notice of Proposed Rule Making and
Declaratory Ruling*, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration ("SBA").[^350] In
addition, the *Notice of Proposed Rule Making* *and Declaratory Ruling*
(or summaries thereof), including the IRFA, will be published in the
Federal Register.[^351]

**A. Need for, and Objectives of, the Proposed Rules**

The *Notice* proposes to permit law enforcement agencies ("LEAs") to
better perform electronic surveillance of telecommunications carriers
under several existing statutes by tentatively concluding that new
broadband Internet services and "managed" Voice over Internet Protocol
("VoIP") services -- *i.e.*, services that offer voice communications
calling capability whereby the VoIP provider acts as a mediator to
manage the communication between its end points and to provide, *e.g.*,
call set up, connection, termination, and party identification features
-- are subject to the assistance capability requirements of the 1994
Communications Assistance for Law Enforcement Act ("CALEA"). The
*Notice* also proposes steps to ensure that telecommunications carriers
comply with CALEA. However, the *Notice* tentatively concludes that
non-managed VoIP services are not subject to CALEA, and does not
proposed to establish a pre-approval process for new technologies and
services that would determine whether they are subject to CALEA, as
requested by the Law Enforcement Petition. The Commission believes that
these proposals strike an appropriate balance between better permitting
LEAs to combat crime and terrorism and the limited scope of CALEA.

**B. Legal Basis**

This proposed action is authorized pursuant to sections 1, 4(i), 7(a),
229, 301, 303, 332, and 410 of the Communications Act of 1934, as
amended, and sections 103, 106, 107, and 109 of the Communications
Assistance for Law Enforcement Act, 47 U.S.C. §§ 151, 154(i), 157(a),
229, 301, 303, 332, 410, 1002, 1005, 1006, and 1008.

**C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rule Will Apply.**

The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that will be
affected by the proposed rules.[^352] The RFA generally defines the term
"small entity" as having the same meaning as the terms "small business,"
"small organization," and "small governmental jurisdiction."[^353] In
addition, the term "small business" has the same meaning as the term
"small business concern" under the Small Business Act.[^354] 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 SBA.[^355]

#### Telecommunications Service Entities

##### Wireline Carriers and Service Providers

1.  We have included small incumbent local exchange carriers 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."[^356] The SBA's Office of Advocacy contends that, for
    RFA purposes, small incumbent local exchange carriers are not
    dominant in their field of operation because any such dominance is
    not "national" in scope.[^357] We have therefore included small
    incumbent local exchange carriers in this RFA analysis, although we
    emphasize that this RFA action has no effect on Commission analyses
    and determinations in other, non-RFA contexts.

2.  *Incumbent Local Exchange Carriers*. Neither the Commission nor the
    SBA has developed a small business size standard specifically for
    incumbent local exchange services. 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.[^358] According to Commission
    data,[^359] 1,337 carriers have reported that they are engaged in
    the provision of incumbent local exchange services. Of these 1,337
    carriers, an estimated 1,032 have 1,500 or fewer employees and 305
    have more than 1,500 employees. Consequently, the Commission
    estimates that most providers of incumbent local exchange service
    are small businesses that may be affected by our action.

3.  *Competitive Local Exchange Carriers, Competitive Access Providers,
    "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.[^360] According to Commission data,[^361] 609 carriers
    have reported that they are engaged in the provision of either
    competitive access provider services or competitive local exchange
    carrier services. Of these 609 carriers, an estimated 458 have 1,500
    or fewer employees and 151 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, 35 carriers have reported that they are
    "Other Local Service Providers." Of the 35, an estimated 34 have
    1,500 or fewer employees and one has more than 1,500 employees.
    Consequently, the Commission estimates that most providers of
    competitive local exchange service, competitive access providers,
    "Shared-Tenant Service Providers," and "Other Local Service
    Providers" are small entities that may be affected by our action.

4.  *Payphone Service Providers*. 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.[^362] According to Commission data,[^363] 761 carriers
    have reported that they are engaged in the provision of payphone
    services. Of these, an estimated 757 have 1,500 or fewer employees
    and four have more than 1,500 employees. Consequently, the
    Commission estimates that the majority of payphone service providers
    are small entities that may be affected by our action.

5.  *Interexchange Carriers.* Neither the Commission nor the SBA has
    developed a small business size standard specifically for providers
    of interexchange services. 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.[^364] According to Commission data,[^365] 261
    carriers have reported that they are engaged in the provision of
    interexchange service. Of these, an estimated 223 have 1,500 or
    fewer employees and 38 have more than 1,500 employees. Consequently,
    the Commission estimates that the majority of IXCs are small
    entities that may be affected by our action.

6.  *Operator Service Providers*. 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.[^366] According to Commission data,[^367] 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 our action.

7.  *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.[^368] According to Commission data,[^369] 37
    carriers have reported that they are engaged in the provision of
    prepaid calling cards. Of these, an estimated 36 have 1,500 or fewer
    employees and one has more than 1,500 employees. Consequently, the
    Commission estimates that the majority of prepaid calling card
    providers are small entities that may be affected by our action.

##### Wireless Telecommunications Service Providers

8.  *Wireless Service Providers.* The SBA has developed a small business
    size standard for wireless firms within the two broad economic
    census categories of "Paging"[^370] and "Cellular and Other Wireless
    Telecommunications." [^371] Under both SBA categories, a wireless
    business is small if it has 1,500 or fewer employees. For the census
    category of Paging, Census Bureau data for 1997 show that there were
    1,320 firms in this category, total, that operated for the entire
    year.[^372] Of this total, 1,303 firms had employment of 999 or
    fewer employees, and an additional 17 firms had employment of 1,000
    employees or more.[^373] Thus, under this category and associated
    small business size standard, the majority of firms can be
    considered small. For the census category Cellular and Other
    Wireless Telecommunications, Census Bureau data for 1997 show that
    there were 977 firms in this category, total, that operated for the
    entire year.[^374] Of this total, 965 firms had employment of 999 or
    fewer employees, and an additional 12 firms had employment of 1,000
    employees or more.[^375] Thus, under this second category and size
    standard, the majority of firms can, again, be considered small.

9.  *Cellular Licensees.* The SBA has developed a small business size
    standard for wireless firms within the broad economic census
    category "Cellular and Other Wireless Telecommunications."[^376]
    Under this SBA category, a wireless business is small if it has
    1,500 or fewer employees. For the census category Cellular and Other
    Wireless Telecommunications firms, Census Bureau data for 1997 show
    that there were 977 firms in this category, total, that operated for
    the entire year.[^377] Of this total, 965 firms had employment of
    999 or fewer employees, and an additional 12 firms had employment of
    1,000 employees or more.[^378] Thus, under this category and size
    standard, the great majority of firms can be considered small.
    According to the most recent *Trends in Telephone Service* data, 719
    carriers reported that they were engaged in the provision of
    cellular service, Personal Communications Service ("PCS"), or
    Specialized Mobile Radio Telephony services, which are placed
    together in the data.[^379] We have estimated that 294 of these are
    small, under the SBA small business size standard.[^380]

10. *Common Carrier Paging.* The SBA has developed a small business size
    standard for wireless firms within the broad economic census
    categories of **"**Cellular and Other Wireless
    Telecommunications."[^381] Under this SBA category, a wireless
    business is small if it has 1,500 or fewer employees. For the census
    category of Paging, Census Bureau data for 1997 show that there were
    1,320 firms in this category, total, that operated for the entire
    year.[^382] Of this total, 1,303 firms had employment of 999 or
    fewer employees, and an additional 17 firms had employment of 1,000
    employees or more.[^383] Thus, under this category and associated
    small business size standard, the great majority of firms can be
    considered small. In the Paging *Third Report and Order*, we
    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.[^384] 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.[^385] The SBA has approved these small business size
    standards.[^386] An auction of Metropolitan Economic Area licenses
    commenced on February 24, 2000, and closed on March 2, 2000.[^387]
    Of the 985 licenses auctioned, 440 were sold. Fifty-seven companies
    claiming small business status won. According to the most recent
    *Trends in Telephone Service,* 433 carriers reported that they were
    engaged in the provision of paging and messaging services.[^388] Of
    those, we estimate that 423 are small, under the SBA approved small
    business size standard.[^389]

11. *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 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.[^390] The Commission auctioned geographic area
    licenses in the wireless communications services. In the auction,
    there were seven winning bidders that qualified as "very small
    business" entities, and one that qualified as a "small business"
    entity.

12. *Wireless Telephony***.** Wireless telephony includes cellular,
    personal communications services, and specialized mobile radio
    telephony carriers. As noted earlier, the SBA has developed a small
    business size standard for "Cellular and Other Wireless
    Telecommunications" services.[^391] Under that SBA small business
    size standard, a business is small if it has 1,500 or fewer
    employees.[^392] According to the most recent *Trends in Telephone
    Service* data, 719 carriers reported that they were engaged in the
    provision of wireless telephony.[^393] We have estimated that 294 of
    these are small under the SBA small business size standard.

13. *Broadband Personal Communications Service*. The broadband 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.[^394] 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."[^395] These standards defining "small entity" in
    the context of broadband PCS auctions have been approved by the
    SBA.[^396] 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.[^397] 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. In addition, we note 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.

    **b. Cable Operators**

14. *Cable and Other Program Distribution***.** This category includes
    cable systems operators and other program distribution services. The
    SBA has developed small business size standard for this census
    category, which includes all such companies generating \$12.5
    million or less in revenue annually.[^398] According to Census
    Bureau data for 1997, there were a total of 1,311 firms in this
    category, total, that had operated for the entire year.[^399] Of
    this total, 1,180 firms had annual receipts of under \$10 million
    and an additional 52 firms had receipts of \$10 million or more but
    less than \$25 million. Consequently, the Commission estimates that
    the majority of providers in this service category are small
    businesses that may be affected by the rules and policies adopted
    herein.

15. *Cable System Operators (Rate Regulation Standard).* The Commission
    has developed its own small business size standard for cable system
    operators, for purposes of rate regulation. Under the Commission's
    rules, a "small cable company" is one serving fewer than 400,000
    subscribers nationwide.[^400] The most recent estimates indicate
    that there were 1,439 cable operators who qualified as small cable
    system operators at the end of 1995.[^401] Since then, some of those
    companies may have grown to serve over 400,000 subscribers, and
    others may have been involved in transactions that caused them to be
    combined with other cable operators. Consequently, the Commission
    estimates that there are now fewer than 1,439 small entity cable
    system operators that may be affected by the rules and policies
    adopted herein.

16. *Cable System Operators (Telecom Act Standard)***.** 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."[^402] The
    Commission has determined that there are 67,700,000 subscribers in
    the United States.[^403] Therefore, 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.[^404]
    Based on available data, the Commission estimates that the number of
    cable operators serving 677,000 subscribers or fewer, totals
    1,450.[^405] The Commission neither requests nor collects
    information on whether cable system operators are affiliated with
    entities whose gross annual revenues exceed \$250 million,[^406] and
    therefore are unable, at this time, to estimate more accurately the
    number of cable system operators that would qualify as small cable
    operators under the size standard contained in the Communications
    Act of 1934.

    **c. Internet Service Providers**

17. *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."[^407] Under
    the SBA size standard, such a business is small if it has average
    annual receipts of \$21 million or less.[^408] According to Census
    Bureau data for 1997, there were 2,751 firms in this category that
    operated for the entire year. [^409] Of these, 2,659 firms had
    annual receipts of under \$10 million, and an additional 67 firms
    had receipts of between \$10 million and \$24, 999,999.
    Consequently, we estimate that the majority of these firms are small
    entities that may be affected by our action.

    **D. Description of projected reporting, recordkeeping, and other
    compliance requirements.**

The proposed rules require that telecommunications carriers providing
Internet broadband access and managed VoIP services be
CALEA-compliant.[^410] The proposed rules also limit extensions of
compliance deadlines under CALEA section 107(c), which authorizes
extensions if technology is not available to carriers to meet the
assistance capability requirements of CALEA section 103.[^411] We also
note that telecommunications carriers, including small entities, may
petition the Commission under CALEA section 109(b) and argue that CALEA
compliance is not reasonably achievable for a variety of reasons,
including a carrier's financial resources.

**E. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered.**

The RFA requires an agency to describe any significant alternatives that
it has considered in reaching its proposed approach, which may include
the following four alternatives (among others): (1) the establishment of
differing compliance or reporting requirements or timetables that take
into account the resources available to small entities; (2) the
clarification, consolidation, or simplification of compliance or
reporting requirements under the rule for small entities; (3) the use of
performance, rather than design, standards; and (4) an exemption from
coverage of the rule, or any part thereof, for small entities.[^412]

We also note that telecommunications carriers, including small entities,
may petition the Commission under CALEA section 109(b) and argue that
CALEA compliance is not reasonably achievable for a variety of reasons,
including a carrier's financial resources. We believe that this
provision safeguards small entities from any significant adverse
economic impacts of CALEA compliance. We are unaware of any alternatives
that would better safeguard small entities, but we solicit comment on
any such alternatives.

**F. Federal Rules that May Duplicate, Overlap, or Conflict With the
Proposed Rules.**

None.

**Appendix C**

**Trusted Third Party Models**

> The most basic compliance solution, which has been used for
> surveillance of circuit-mode voice, is to build the necessary features
> into network equipment, as shown in Figure 1.

**Figure 1: Compliance solution architecture based on direct feed from
Intercept Access Point**

In the figure, each gray box represents a piece of network equipment
with an intercept access point, CII is the call-identifying information,
and CC is call content; the CII and CC are provided to Law Enforcement
in two separate channels. As shown in Figure 1, a piece of network
equipment with an intercept access point hands off the necessary
information to Law Enforcement. Network equipment that meets safe harbor
standards for CII and CC interfaces would be CALEA compliant. We note
that this could result in having many interfaces built between the
network and Law Enforcement, with each interface using a slightly
different option available under a standard.

**Figure 2: Compliance solution architecture based on Mediation Device**

The first trusted third party approach involves use of a Mediation
Device. This is illustrated in Figure 2. In this model, CII and CC
channels from multiple pieces of network equipment are aggregated by the
Mediation Device. (Some systems may be capable of providing only CC or
only CII, but not both, as shown in the figure.) The Mediation Device
may also provide uniform formatting for Law Enforcement, thus
eliminating any need by Law Enforcement or the service provider to
mandate which of the many options allowed by the J-Standard and other
standards must be used. In effect, the various pieces of network
equipment may each use different options, and the Mediation Device can
still provide a uniform interface to Law Enforcement. The manufacturers
of network equipment would still need to satisfy safe harbor standards
for both CII and CC in order to qualify as being CALEA compliant under
safe harbor standards. The Mediation Device model is currently being
used by a number of companies in the United States, including Time
Warner and Comcast.

There is a second trusted third party approach that could be used to
make the content and call-identifying information of a packet
communication available. This approach is illustrated in Figure 3.

**Figure 3: Compliance solution architecture based on External System**\
\
Technology is available today to have an External System identify,
isolate and extract call-identifying information from the packets going
to and from a subject. We seek comment on the feasibility of having the
network equipment deliver all packets of a subject to an External
System. In cases where the subject has a dynamically assigned IP
address, is it still feasible for network equipment to deliver all of
the subject's packets to an External System? Are there cases where
surveillance of a subject with a dynamic IP address could be better
accomplished with a Mediation Device, instead of an External System; or
with a direct link between network equipment and LEA collection
equipment? Could the packets be provided by one or more probes or
"sniffers" on a line into a router or switch, instead of the router or
switch itself? Could a subject's packets be provided to the External
System by devices operating at layers below the Internet Protocol layer?
For example, could a subject's packets be provided by an ATM switch
based on virtual circuit identifiers, or by a cable modem termination
system based on a MAC address? All packets to and from a subject may be
delivered from network equipment to the External System in accordance
with the J-Standard content requirements.[^413] The CII and CC channels
between the External System and LEA Collection Equipment may comply with
available CII and CC interfaces defined in safe harbor standards.
Regardless of how access to content is obtained, the External System
could either be under the carrier's control, or the carrier could
contract with a service bureau for a variety of CALEA compliance
services using the third-party's External System.

**Appendix D**

**Standards for packet-mode technologies**

**Standards for packet content**

Subcommittee TR45.2 of the TIA developed standard J-STD-025, *Lawfully
Authorized Electronic Surveillance,* to serve as a \"safe harbor\" for
wireline, cellular, and broadband PCS carriers and manufacturers under
section 107(a) of CALEA. J-STD-025 was jointly published in December
1997 by TIA and Committee T1 (the latter sponsored by the Alliance for
Telecommunications Industry Solutions). J-STD-025 defines services and
features required by wireline, cellular, and broadband PCS carriers to
support lawfully authorized electronic surveillance, and specifies the
interfaces for delivering the intercepted communications (*i.e.*,
content) and call-identifying information to a LEA. J-STD-025 also
includes standards for some packet-mode communications capability
(content only)[^414] and a location information requirement.[^415] The
publishers of the J-Standard subsequently revised it into J-STD-025-A
(Revision A of the J-Standard) to incorporate the changes adopted by the
Commission in its *Third R&O* to include the six DoJ/FBI "punch list"
capabilities.[^416] J-STD-025-A was issued in May 2000 and became an
American National Standard on April 16, 2003.

J-STD-025, J-STD-025-A and J-STD-025-B (described below) require that a
Packet Data intercept access point[^417] shall access data packets sent
or received by the equipment, facilities, or services of an intercept
subject when a packet-mode data service is provided and that packets
shall be sent to a LEA when they are intercepted. TIA states that for
low-volume communications (*e.g.*, short messaging service ("SMS")), the
content may be included in a packet envelope message that may be
provided to the LEA in a CII channel, but for high-volume communications
(*e.g.*, most packet data applications) the entire packet stream must be
provided to the LEA in a content channel. A Packet Data intercept access
point provides access to one or more of the following packet-mode data
services: 

-   ISDN user-to-user signaling;

-   ISDN D-channel X.25 packet services; 

-   SMS for cellular and PCS (*e.g.*, Narrowband Advanced Mobile Phone
    System, *TIA/EIA-41*, PCS1900, or Global Systems for Mobile
    Communications ("GSM")-based technologies); 

-   Wireless packet-mode data services (*e.g.*, Cellular Digital
    Packet Data, CDMA, Time Division Multiple Access, PCS1900, or
    GSM-based packet-mode data services);   

-   X.25 services; 

-   IP services; 

-   Paging (one-way or two-way); and 

-   Packet-mode data services using traffic channels. 

 

> Although it is clear from the text in J-STD-025, J-STD-025-A
> and J-STD-025-B that the content standard applies to all of the listed
> protocols, it is not clear whether it applies to other protocols that
> are not listed.  For example, Asynchronous Transfer Mode is not
> listed.  Does the standard apply to ATM communications? Does the
> standard apply to Ethernet and frame relay communications?  Can it
> serve as a safe harbor for content for these and packet-mode
> services based on other non-listed protocols? 

**Standards for packet call-identifying information**

> This section reviews various existing standards and technical
> requirements for providing packet call-identifying information to Law
> Enforcement. Each standard is written to apply to a specific set of
> packet services or technology, or specific combinations of services
> and technologies, since what is reasonably available call-identifying
> information may vary by service and technology. As noted above, it is
> not yet determined whether any or all of these services and
> technologies will have CALEA obligations. For each standard, we wish
> to examine whether that standard would be adequate to serve as a "safe
> harbor" for purposes of CALEA, or whether that standard would be
> "deficient" for purposes of CALEA, if the services and/or technologies
> addressed by the standard were subject to CALEA obligations, as "safe
> harbor" and "deficient" are used in the CALEA statute.[^418] We will
> be specifically interested in whether the standard provides Law
> Enforcement with appropriate reasonably available call-identifying
> information for the addressed services and technologies.

**(1) TIA, ATIS, and J-STD-025-B\
**

Subsequent to its issuing of J-STD-025-A, the TIA produced J-STD-025-B,
another revision of the J-Standard. The purpose of J-STD-025-B revision
is to add requirements for support of packet mode call-identifying
information. J-STD-025-B was approved as a TIA standard and an ATIS
trial use standard in January 2004. TIA also indicates that it will be
developing another revision, J-STD-025-C, to address additional needs of
LEAs.[^419]

J-STD-025-B provides standards in three areas, two for wireless carriers
and one for wireline carriers. First, it includes its own text for
surveillance of Internet access services using cdma2000®[^420]
technology, which is used by many commercial wireless service providers.
Second, it references in the current trial use standard to 3^rd^
Generation Partnership Project ("3GPP") specifications for surveillance
of both Internet access and voice over packet using UMTS wireless
technology.[^421] The 3GPP specifications are aligned with ATIS standard
T1.724, and it is expected that the final version of J-STD-025-B will
refer directly to T1.724 instead of the 3GPP specifications.[^422] In
January 2004 ANSI approved ATIS standard T1.724-2004, *UMTS Handover
Interface for Lawful Interception.* T1.724 supports surveillance of both
Internet access services and Session Initiation Protocol ("SIP")-based
multimedia (including voice) over packet services using UMTS or General
Packet Radio Service technology. ATIS indicates that it will be
incorporating additional capabilities for ATIS into other standards in
the future.[^423]

Finally, J-STD-025-B references to ATIS standard T1.678 for surveillance
of voice over packet services provided over wireline. In January 2004
ANSI approved ATIS standard T1.678-2004, *Lawfully Authorized Electronic
Surveillance ("LAES") for Voice over Packet Technologies in Wireline
Telecommunications Networks.* T1.678 supports surveillance of VoIP
arrangements using two call set-up protocols: SIP and H.323-based VoIP
services.

TIA and ATIS claim that "Compliance with \[J-STD-025-B\] satisfies the
'safe harbor' provisions of section 107 of CALEA. . . ."[^424] As is
also mentioned above, J-STD-025-B refers to ATIS standard T1.678 for
providing LEAs with access to call-identifying information on voice over
packet services provided over wireline. We seek comment on the
suitability of T1.678 to serve as a safe harbor for providing LEAs with
access to call-identifying information for voice over packet services
provided over wireline, if voice over packet over wireline is ultimately
determined to be subject to CALEA obligations. Those who consider T1.678
deficient for that purpose should identify specific deficiencies. In
addition, J-STD-025-B refers to international standards aligned with
ATIS standard T1.724 for providing LEAs with access to call-identifying
information on both Internet access and voice over packet using UMTS
wireless technology. We seek comment on the suitability of T1.724 to
serve as a safe harbor for Internet access and voice over packet
services provided via UMTS, if such services are ultimately determined
to be subject to CALEA obligations. Those who consider T1.724 deficient
for those purposes should identify specific deficiencies.

**(2) Cable Television Laboratories (CableLabs®) specification**[^425]

In 1999 CableLabs® initiated development of a specification for lawfully
authorized electronic surveillance for cable operators using systems
compliant with CableLabs® PacketCable™[^426] specifications for
multi-media services such as IP telephony. Version I01 of the
*PacketCable™ Electronic Surveillance Specification*
(PKT-SP-ESP-I01-991229) was released on December 29, 1999. It provides
basic capabilities to deliver call content and call-identifying
information to LEAs. Subsequently, in June 2001, the FBI submitted
Engineering Change Requests ("ECRs") to CableLabs®. On August 1, 2003,
CableLabs® released Version I02 (PKT-SP-ESP-I02-030815), which resolved
technical issues remaining from I01 and added some new capabilities
requested by the FBI, including subject and network initiated signaling.
Shortly thereafter the FBI submitted additional ECRs to CableLabs®.
Version I03 (PKT-SP-ESP-I03-040113), the current version, was released
on January 13, 2004. It fixes minor technical errors left over from
Version I02, and fully specifies language and coding over the interface
to a LEA. It also provides more capabilities requested by the FBI,
including VoIP-specific data to be provided to a LEA for pen register
and trap-and-trace, and information on 3-way calls. The FBI's technical
consultants (Trideaworks) are now on the CableLabs® technical team, and
work is continuing in this area at CableLabs®.[^427]

We seek comment on the suitability of any version of the *PacketCable™
Electronic Surveillance Specification* to serve as a safe harbor for
voice over packet services provided over cable in a manner consistent
with PacketCable™ specifications for multi-media services, if such
services are ultimately determined to be subject to CALEA obligations.
Those who consider any version deficient for that purpose should
identify specific deficiencies.

**APPENDIX E**

**INFORMATION REQUIRED WITH SECTION 107(C) AND SECTION 109(B)**

**CIRCUIT PETITIONS**

1.  Provide all information requested in paragraphs 11, 12 or 13 of the
    FCC's *9/28/01 Public Notice*, as applicable.[^428] In addition, for
    each switch identified either in the service provider\'s Flexible
    Deployment template[^429] or in the information provided pursuant to
    paragraph 13 of the *9/28/01 Public* *Notice*, provide the date the
    switch was initially installed in the service provider\'s network
    and the installation date of the most recent software generic.

2.  Describe the CALEA solution(s) the service provider intends to
    implement by switch type (make, model and manufacturer). Include a
    discussion of required equipment or software upgrades and additional
    components such as adjunct processors that are required to implement
    section 103 assistance capabilities.[^430] Indicate if the
    solution(s) involve the use of a third party CALEA service provider,
    association or cooperative, and the functions the third party
    provider is expected to perform.

3.  Provide estimates of the capital cost (*i.e.,* the engineered,
    furnished, and installed ("EF&I") costs of hardware and/or software)
    of implementing the solutions in the service provider\'s network, by
    switch type. Where applicable, include the estimated costs of using
    a third party CALEA service provider. Support all estimates with
    manufacturer/service provider documentation. Also provide estimates
    of operations costs. Demonstrate how each estimate was derived in a
    manner that permits the results to be verified and duplicated.

4.  Provide an indication of the impact of the cost on the service
    provider by indicating the total number of customers served by the
    provider for circuit-switched services, and by comparing the
    estimated total cost to the provider\'s capital budget for the next
    five years.

5.  Provide the total number of requests for all lawful wiretaps the
    service provider has received in each of the last five years
    (1999-2003), and further break down that number into the following
    categories. (1) Provide the number of requests for pen registers and
    trap-and-trace interceptions the service provider has received in
    each of the last five years. (2) Provide the number of requests for
    all content interceptions the service provider has received in the
    last five years. (3) Provide the number of all requests for CALEA
    pen registers and CALEA trap-and-trace interceptions the service
    provider has received in each of the last three years. (4) Provide
    the number of requests for CALEA content interceptions the service
    provider has received in each of the last three years.

6.  Relate any additional concerns regarding circuit-mode compliance
    that may affect the outcome of this petition.

**APPENDIX F**

**INFORMATION REQUIRED WITH SECTION 107(C) AND SECTION 109(B)**

**PACKET PETITIONS**

1.  Identify each packet service to be covered by the extension and the
    date that service was initially offered to the public. Include
    carrier-provided VoIP.

2.  Provide the reason an extension is being sought for each identified
    packet service.

3.  For each packet service, identify and list all intercept access
    points. List the packet network equipment in use at each intercept
    access point and provide the name of the manufacturer, make, model
    and function (*e.g.*, router, DSLAM, ATM or other packet switch) of
    each. Also provide the date of initial installation of the equipment
    in the service provider\'s network, the generic software release
    currently loaded on the equipment and the date of the installation
    of that software release.

4.  For each packet service covered by the extension, identify the
    applicable industry surveillance standards or specifications
    (*e.g.*, TIA J-STD-025-A, TIA J-STD-025-B, ANSI T1.678, ANSI T1.724,
    and PACKETCABLE PKT-SP-ESP-I03-040113), if they exist, to which
    service provider intends to conform. If no other standard exists,
    the service provider should discuss specifically whether or not the
    packet content requirements in J-STD-025-A apply to its service
    offering. Wireline and wireless carriers have been required to
    provide packet content to LEAs consistent with the packet content
    portion of J-STD-025-A by September 30, 2001 since the *Third R&O*
    was issued.[^431] A subsequent Order (FCC-01-265) extended this date
    to November 19, 2001.[^432] If the service provider believes that
    the packet content requirements in J-STD-025-A are not applicable to
    its service offering, it should explain why not. It should also
    explain whether the issue is technical applicability (*i.e.*,
    J-STD-025-A cannot be applied to the provider\'s service for
    technical reasons) or legal applicability (*i.e.*, J-STD-025-A
    cannot be applied to the provider\'s service for legal reasons). For
    those cases where the service provider is unable to provide content
    to a LEA or to an External System in a manner consistent with
    J-STD-025-A, is there any alternative method or interface by which
    the service provider could provide content to a LEA or to an
    External System? If no such alternative exists, could the service
    provider place a probe in its network to facilitate implementation
    of a third party CALEA solution? Note that ignorance of applicable
    standards is not a justification for an extension.

5.  Identify and describe the packet CALEA solution(s) the service
    provider plans to implement. Include a discussion of equipment or
    software upgrades and additional components such as mediation
    devices and/or probes that are required to implement the solution.
    Indicate if the solution involves the use of a third party CALEA
    service provider, association or cooperative, and the functions the
    third party provider is expected to perform. Indicate whether, in
    this solution architecture, the service provider\'s network
    equipment provides content, call-identifying information or both.
    Indicate whether the overall solution provides content,
    call-identifying information or both.

6.  When solutions are available, provide estimates of the capital cost
    (*i.e.,* the engineered, furnished, and installed ("EF&I") costs of
    hardware and/or software) of implementing the solutions in the
    service provider\'s network. Where applicable, include the estimated
    costs of using a third party CALEA service provider. Support cost
    estimates with manufacturer/third party provider documentation. Also
    provide estimates of operations costs associated with providing each
    specific CALEA solution. Demonstrate how each estimate was derived
    in a manner that permits the results to be verified and duplicated.

7.  Indicate the impact of the cost by providing the number of packet
    customers and the number of circuit customers served by the service
    provider in each of the past five years, and by comparing the
    estimated total cost to the service provider\'s capital budget for
    the next five years.

8.  Provide the total number of requests received by the service
    provider for the following services in each of the last five
    years: (a) packet-mode content wiretaps; (b) circuit-mode content
    wiretaps; (c) packet-mode pen register and trap-and-trace wiretaps;
    and (d) circuit-mode pen register and trap and trace wiretaps. In
    addition, provide the number of LEA requests for the following CALEA
    services in each of the last three years: (a) packet-mode content
    wiretaps; (b) circuit-mode content wiretaps; (c) packet-mode pen
    register and trap-and-trace wiretaps; and (d) circuit-mode pen
    register and trap-and-trace wiretaps.

9.  Relate any additional concerns regarding packet-mode compliance that
    may affect the outcome of this petition.

    **STATEMENT OF**

    **CHAIRMAN MICHAEL K. POWELL**

    *Re: In the Matter of Communications Assistance for Law Enforcement
    Act and Broadband Access and Services, RM-10865, ET Docket No.
    04-295, Notice of Proposed Rulemaking and Declaratory Ruling.*

We are entering a dynamic space in the evolution of Internet voice
services and applications. As technologies re-shape communications, this
Commission must continually assess the needs of the law enforcement
community under the Communications Assistance for Law Enforcement Act
("CALEA"). More and more people are taking advantage of these new and
exciting competitive voice offerings, and we are starting to see
substantial consumer and economic benefits emerge. The development and
success of the Internet has been a result, in part, of our desire to
maintain its minimally regulated status. Above all, law enforcement
access to IP-enabled communications is essential. CALEA requirements can
and should apply to VoIP and other IP enabled service providers, even if
these services are "information services" for purposes of the
Communications Act. The NPRM we issue today demonstrates that the
interests of the law enforcement community can be fully addressed for
potential information services and these interests need not be an excuse
for imposing onerous common carrier regulations on vibrant new services.

Previous Commission action on CALEA has focused primarily on
circuit-mode technology. Today's item takes a major step in implementing
CALEA, particularly with respect to new packet-mode technologies, by
tentatively concluding that broadband Internet access services and
managed voice over Internet protocol ("VoIP") services are subject to
CALEA. The item also tentatively concludes that non-managed, or
disintermediated, VoIP and Instant Messaging are not subject to CALEA,
and that it is unnecessary to identify future services and entities
subject to CALEA. Additionally, the item addresses important compliance
and cost issues, and requests comment on (1) the feasibility of carriers
relying on a trusted third party to manage their CALEA compliance
obligations; and (2) whether standards for packet technologies are
deficient and preclude carriers relying on them as safe harbors for
complying with CALEA's capability requirements. Finally, in the
companion *Declaratory Ruling* grants in part a Law Enforcement request
in the Petition and clarifies that commercial wireless "push-to-talk"
services are subject to CALEA, regardless of the technologies that
Commercial Mobile Radio Service providers choose to apply in offering
them.

I write to make clear that our tentative conclusion is expressly limited
to the requirements of the CALEA statute and does not indicate a
willingness on my part to regulate VoIP services as telecommunications
services. We have before us a pending rulemaking and several petitions
for declaratory ruling that address themselves to the classification of
VoIP services and nothing in this item prejudices the outcome of those
proceedings.

Our support for law enforcement is unwavering; it is our goal in this
proceeding to ensure that law enforcement agencies have all of the
electronic surveillance capabilities that CALEA authorizes to combat
crime and terrorism and support Homeland Security. The Commission will
devote the necessary resources to expeditiously and responsibly complete
this task. In the interim, carriers, the law enforcement community and
the Commission must continue to work in partnership to ensure that law
enforcement retains access to the information they have now and to
ensure that they have the tools they need in this ever changing
environment.

**STATEMENT OF**

**COMMISSIONER KATHLEEN Q. ABERNATHY**

**\
***Re: In the Matter of Communications Assistance for Law Enforcement
Act and Broadband Access and Services, RM-10865, ET Docket No. 04-295,
Notice of Proposed Rulemaking and Declaratory Ruling.*

As set forth in the opening provision of the Communications Act, the
Commission has no higher priority than promoting public safety and the
national defense. I therefore support initiating this rulemaking
regarding the Commission's implementation of the Communications
Assistance for Law Enforcement Act (CALEA). The Department of Justice
and other law enforcement agencies have raised a number of significant
questions regarding the applicability of CALEA to IP-enabled services,
compliance timelines, enforcement, and cost recovery, among other
things. The Commission must build a thorough record to ensure that, to
the extent permitted by statute, law enforcement agencies have the tools
they need to conduct surveillance in a changing technological
environment.

While the Commission must do its utmost to enable law enforcement
agencies to combat crime and promote homeland security, it would be a
mistake to gloss over the possibility that the existing statutory
framework does not apply to broadband Internet access services or other
IP-enabled services that are classified as information services. The
NPRM we are issuing proposes a plausible interpretation of the
"substantial replacement" provision in CALEA that would extend the
assistance-capability requirements to broadband access services and IP
telephony. But such an extension clearly would be fraught with legal
risk. The Commission thus would benefit greatly from further
congressional guidance in this area. While the text and legislative
history of CALEA make clear that the march of technological progress
should not hamper law enforcement's ability to conduct lawful wiretaps,
the statute also explicitly exempts information services from its reach.
The Commission has proposed a means of resolving this tension, but it
remains to be seen whether our attempts to do so would pass judicial
muster.

In addition to the question whether CALEA applies to IP-enabled
services, the issues of enforcement and cost recovery also warrant
congressional attention. Section 108 of CALEA establishes an enforcement
mechanism that requires the Attorney General to bring a civil action in
the appropriate federal district court. While law enforcement agencies
have noted the shortcomings of this regime, it is unclear whether
Congress intended the Commission to assume a central role over
enforcement of the statute's requirements. Moreover, upgrading networks
to comply with a new packet-mode standard for surveillance will be a
costly endeavor, and there are many unanswered questions about how these
costs should be recovered.

In sum, I support the Commission's initiation of this rulemaking in
response to the petition filed by the Department of Justice and other
law enforcement agencies. The issues raised are critical, and the
Commission must provide clarity and direction to the greatest extent
possible. But at the end of the day, the federal courts ― rather than
this Commission ― will be the arbiter of whether we are authorized to
take the actions proposed in this rulemaking, and we must remain mindful
of that fact as we consider final rules.

**STATEMENT OF\
COMMISSIONER MICHAEL J. COPPS,**

**CONCURRING**

*Re: In the Matter of Communications Assistance for Law Enforcement Act
and Broadband Access and Services, RM-10865, ET Docket No. 04-295,
Notice of Proposed Rulemaking and Declaratory Ruling.*

The Commission states that its primary policy goal in this proceeding is
to ensure that law enforcement has all of the resources that CALEA
authorizes to combat crime and support homeland security. This is as it
should be. But there are less roundabout ways to achieve this result
then the collection of tentative conclusions we offer here and there are
better ways to build a system that will guarantee judicial approval.

I believe today's item asks many of the right questions, but I also
believe that too often it gets the reasoning wrong. It is flush with
tentative conclusions that stretch the statutory fabric to the point of
tear. If these proposals become the rules and reasons we have to defend
in court, we may find ourselves making a stand on very shaky ground. It
would be a shame if our reliance on thin legal arguments results in the
CALEA rules being thrown out. Neither law enforcement nor the American
people would benefit from that result.

To me, it strains credibility to suggest that Congress intended "a
replacement for a substantial portion of the local telephone exchange"
to mean the replacement of ***any*** portion of any individual
subscriber's functionality. Capturing VoIP under the rubric of
substantial replacement, ignoring the Ninth Circuit's decision in *Brand
X*, and trying to slice and dice managed and non-managed services is not
the way to proceed here. Making the statute bear this heavy burden
denies carriers, equipment manufacturers and technology entrepreneurs
the clarity they need. But more importantly, our law enforcement
authorities need that clarity. Those whose job it is to shield us from
harm deserve better. So I don't agree with how we got to this
conclusion, but given where we are, we have the responsibility to get a
proceeding going. For these reasons, I will concur, but I hope before
all is said and done that the record will provide better counsel and our
final decisions will put us on a sounder footing.

**STATEMENT OF**

**COMMISSIONER JONATHAN S. ADELSTEIN**

**CONCURRING**

*Re: In the Matter of Communications Assistance for Law Enforcement Act
and Broadband Access and Services, RM-10865, ET Docket No. 04-295,
Notice of Proposed Rulemaking and Declaratory Ruling.*

With this Notice of Proposed Rulemaking and Declaratory Ruling, we open
a proceeding to examine the application and administration of the
Communications Assistance for Law Enforcement Act (CALEA) as the
telecommunications industry transitions to so-called packet-mode
services, such as broadband Internet access and Voice over Internet
Protocol (VoIP). We start this review at the request of the Department
of Justice, the Federal Bureau of Investigation, and the Drug
Enforcement Administration ("federal law enforcement"), but the outcome
of this proceeding will also affect the ability of state and local law
enforcement agencies throughout the nation, which conduct roughly half
of all wiretaps, to conduct their operations efficiently and
effectively.

This item begins to tackle the increasingly important issue of whether
CALEA applies to broadband and VoIP services. Federal law enforcement
agencies view this capability as essential to their ability to perform
their missions in the digital age. It is imperative that we give law
enforcement the tools that CALEA affords them and that they need to
safeguard public safety and homeland security. This Notice facially
accedes to law enforcement's request, but stops short of developing
fully the most defensible basis for these proposed outcomes, which are
at the heart of the federal law enforcement agencies' petition.

Rather than seeking comment on the most stable footing for law
enforcement's request, the item seizes upon notable but thin
distinctions between definitions in CALEA and the Communications Act.
Moreover, the item does not acknowledge fully and seek comment on
existing precedent that is in tension with the tentative conclusions
here. For example, whether or not the Commission ultimately appeals the
decision in the Ninth Circuit's *Brand X* case, which concluded that
broadband access via cable modem includes a "telecommunications
service," this Notice's failure to seek comment on a legal analysis that
would comport with the Circuit's holding is an unnecessary failing. For
these reasons, I concur in the result, if not the full legal analysis
behind the Commission's tentative conclusions.

I am pleased that the Commission is opening this proceeding and that we
can move forward with a full vetting of the issues. While we should not
jump to conclusions about the many issues raised here, it is critical
that we make this proceeding a priority and that we commit to a speedy
resolution of the complex, but time sensitive issues raised here.

[^1]: *See* "Joint Petition for Expedited Rulemaking," RM-10865, filed
    March 10, 2004 ("Petition"). We stress that the tentative
    conclusions we reach in the instant proceeding in no way predispose
    how the Commission may proceed with respect to adopting a regulatory
    framework for Internet Protocol ("IP")-enabled and broadband
    services or determining their legal classification under the
    Communications Act. *See, e.g.,* *IP-Enabled Services*, WC Docket
    No. 04-36, *Notice of Proposed Rulemaking*, 19 FCC Rcd 4863 (2004)
    (*IP-Enabled Services Notice*); *Wireline Broadband* *NPRM*, *infra*
    n.Error: Reference source not found (noting other broadband
    proceedings and initiatives within the Commission); s*ee also* SBC
    Communications, Inc. ("SBC") Comments at 4-5 (urging us to clarify
    that a classification under CALEA does not affect classification
    under the Communications Act).

[^2]: 18 U.S.C. § 2518(4).

[^3]: Section 103(a)(1)-(4) of CALEA, 47 U.S.C. § 1002(a)(1)-(4).

[^4]: In enacting CALEA, Congress sought to balance three important
    policies: \"(1) to preserve a narrowly focused capability for law
    enforcement agencies to carry out properly authorized intercepts;
    (2) to protect privacy in the face of increasingly powerful and
    personally revealing technologies; and (3) to avoid impeding the
    development of new communications services and technologies.\" H.R.
    Rep. No. 103-827, 103d Cong., 2d Sess., pt. 1, at 13 (1994) ("House
    Report").

[^5]: 47 U.S.C. § 1001(8).

[^6]: *See* 47 U.S.C. § 332(d).

[^7]: *See* 47 U.S.C. § 1001(8)(B)(ii). Exempt from this definition are
    entities insofar as they provide information services and any
    category of telecommunications carriers that the Commission exempts
    by rule after consultation with the Attorney General. *See* 47
    U.S.C. § 1001(8)(C).

[^8]: *Communications Assistance for Law Enforcement Act*, CC Docket No.
    97-213, *Second Report and Order*, 15 FCC Rcd 7105 (2000), at 7110,
    ¶ 9. The *Second R&O* stated that the legislative history contains
    examples of the types of service providers subject to CALEA: "The
    definition of 'telecommunications carrier' includes such service
    providers as local exchange carriers, interexchange carriers,
    competitive access providers, cellular carriers, providers of
    personal communications services, satellite-based service providers,
    cable operators, and electric and other utilities that provide
    telecommunications services for hire to the public, and any other
    wireline or wireless service for hire to the public." *Id*. at 7111,
    ¶ 10, *citing* 140 Cong. Rec. H-10779 (daily ed. October 7, 1994)
    (statement of Rep. Hyde). *See also* H.R. Rep. No. 103-827(I), at
    23, *reprinted in* 1994 U.S.C.C.A.N. 3489, 3500.

[^9]: *Second R&O*, *supra* n.Error: Reference source not found at 7118,
    ¶ 24.

[^10]: *Id*. at 7112, ¶ 12

[^11]: *Id*. at 7112, ¶ 13. The Commission later clarified, in an Order
    on Reconsideration of the *Second R&O,* the CALEA obligations of
    resellers who rely on the facilities of an underlying carrier that
    does not provide telecommunications service for purposes of CALEA.
    Specifically, the Commission stated that under such circumstances, a
    non-facilities based reseller of telecommunications services is not
    exempt from "its overall obligation to ensure that its services
    satisfy all the assistance capability requirements of section 103."
    *Communications Assistance for Law Enforcement Act*, CC Docket No.
    97-213, *Second Order on Reconsideration*, 16 FCC Rcd 8959 (2001) at
    8971, ¶ 37. The Commission also noted that when "a reseller does not
    resell the services of a facilities-based carrier subject to CALEA,
    it can contract with its facilities provider or third parties for
    CALEA assistance capabilities in the same way it contracts for any
    other network capabilities." *Id.* at 8971, ¶ 38*.*

[^12]: Section 103(a)(1)-(4) of CALEA, 47 U.S.C. § 1002(a)(1)-(4).

[^13]: CALEA does not define or interpret the term \"reasonably
    available.\"

[^14]: 47 U.S.C. § 1002(a)(1)-(4). "Call-identifying information" is
    defined in section 102(2) of CALEA as \"dialing or signaling
    information that identifies the origin, direction, destination, or
    termination of each communication generated or received by a
    subscriber by means of any equipment, facility, or service of a
    telecommunications carrier.\" 47 U.S.C. § 1001(2). For a discussion
    of call-identifying information, *see* ¶¶ Error: Reference source
    not found-Error: Reference source not found, *supra*.

[^15]: 47 U.S.C. § 1002(b)(2).

[^16]: 47 U.S.C. § 1002(b)(1).

[^17]: 47 U.S.C. § 1002(b)(3).

[^18]: 47 U.S.C. § 1005(a).

[^19]: 47 U.S.C. § 1005(b).

[^20]: See H.R. Rep. No.103-827, 103rd Cong., 2d Sess, pt. 1, at 3507
    (1994) (\"Compliance with the industry standard is voluntary not
    compulsory. Carriers can adopt other solutions for complying with
    the capability requirements.\")

[^21]: 47 U.S.C. § 1006(a)(2).

[^22]: ^?^A party may petition the Commission to establish, by rule,
    technical requirements or standards that --

    \(1\) meet the assistance capability requirements of section 103 by
    cost-effective methods;

    \(2\) protect the privacy and security of communications not
    authorized to be intercepted;

    \(3\) minimize the cost of such compliance on residential
    ratepayers;

    > \(4\) serve the policy of the United States to encourage the
    > provision of new technologies and services to the public; and

    \(5\) provide a reasonable time and conditions for compliance with
    and the transition to any new standard, including defining the
    obligations of telecommunications carriers under section 103 during
    any transition period. 47 U.S.C. § 1006(b).

[^23]: J-STD-025, *Lawfully Authorized Electronic Surveillance*, was
    jointly published in December 1997 by TIA and Committee T1,
    sponsored by the Alliance for Telecommunications Industry Solutions.

[^24]: Section 3 of the J-Standard describes packet-mode as a
    "communication where individual packets or virtual circuits of a
    communication within a physical circuit are switched or routed by
    the accessing telecommunication system. Each packet may take a
    different route through the intervening network(s)."

[^25]: ^?^The J-Standard includes a parameter that identifies the
    location of a subject\'s "mobile terminal" whenever this information
    is reasonably available and its delivery to a LEA is legally
    authorized. Location information is available to the LEA
    irrespective of whether a call content channel or a call data
    channel is employed. *See* J-STD-025 at § 6.4.6 and §§ 5.4.1-5.4.8,
    Tables 1, 5, 6, and 8.

[^26]: *Communications Assistance for Law Enforcement Act*, CC Docket
    No. 97-213, *Third Report and Order*, 14 FCC Rcd 16794 (1999). The
    six required punch list capabilities were "dialed digit extraction,"
    which would provide to LEAs those digits dialed by a subject after
    the initial call setup is completed, *id*. at 16842, ¶ 112; "party
    hold/join/drop," which would provide to LEAs information to identify
    the active parties to a conference call, *id*. at 16825, ¶ 68;
    "subject-initiated dialing and signaling," which would provide to
    LEAs access to all dialing and signaling information available from
    the subject, such as the use of flash‑hook and other feature keys,
    *id*. at 16828, ¶ 76; "in‑band and out‑of‑band signaling," which
    would provide to LEAs information about tones or other network
    signals and messages that a subject's service sends to the subject
    or associate, such as notification that a line is ringing or busy,
    *id*. at 16830, ¶ 83; "subject-initiated conference calls," which
    would provide to LEAs the content of conference calls supported by
    the subject's service, *id*. at 16821, ¶ 58; and "timing
    information," which would provide to LEAs information necessary to
    correlate call‑identifying information with call content, *id*. at
    16833, ¶ 90. The publishers of the J-Standard subsequently issued a
    revised standard -- J-STD-025-A -- that incorporated the changes
    adopted by the Commission in its *Third R&O*. The revised J-Standard
    was issued in May 2000.

[^27]: *Third R&O* at 16802, 16816; ¶¶ 13 and 46.

[^28]: *Id.* at 16819, 16849; ¶¶ 55 and 129.

[^29]: *See* *Communications Assistance for Law Enforcement Act*, CC
    Docket No. 97-213, *Order*, 16 FCC Rcd 17397 (2001).

[^30]: The four challenged punch list requirements were dialed digit
    extraction, party hold/join/drop, subject-initiated dialing and
    signaling, and in‑band and out‑of‑band signaling.

[^31]: *See United States Telecom. Association v. FCC*, 227 F.3d 450
    (D.C. Cir. 2000) (hereinafter "*Remand Decision*"). The *Remand
    Decision* is available at
    [http://www.fcc.gov/ogc/documents/opinions/2000/99-1442.html]{.underline}.

[^32]: *Communications Assistance for Law Enforcement Act*, CC Docket
    No. 97-213, *Order on Remand*, 17 FCC Rcd 6896 (2002).

[^33]: Under subsection 104(a) the Attorney General was required, within
    one year of CALEA's enactment, to publish in the Federal Register
    and provide to appropriate telecommunications industry associations
    and standard-setting organizations notice of the actual number of
    communication interceptions, pen registers, and trap and trace
    devices that the Attorney General estimated would be conducted
    within four years of CALEA's enactment, as well as the estimated
    maximum capacity required after that date. Subsection 104(c)
    requires that the Attorney General periodically publish in the
    Federal Register, after notice and comment, notice of any necessary
    increases in the maximum capacity requirements. Subsection 104(d)
    requires that, within 180 days after publication by the Attorney
    General of a notice of capacity requirements pursuant to either
    subsections 104(a) or 104(c), telecommunications carriers submit to
    the Attorney General statements identifying any systems or services
    that do not have the capacity to accommodate simultaneously the
    number of interceptions, pen registers, and trap and trace devices
    set forth in the Attorney General's notices. Subsection 104(e)
    requires that the Attorney General review the statements submitted
    under subsection 104(d) and states that the Attorney General may,
    subject to the availability of appropriations, agree to reimburse a
    telecommunications carrier for costs directly associated with
    modifications to attain such capacity requirements that are
    determined to be reasonable in accordance with section 109(e) of
    CALEA. Until the Attorney General agrees to reimburse such carrier
    for such modification, that carrier shall be considered to be in
    compliance under subsections 104(a) or 104(c). 47 U.S.C. §§ 1003(a),
    (c)-(e).

[^34]: 47 U.S.C. § 1003(b).

[^35]: 63 Fed. Reg. 12,218 (1998).

[^36]: United States Telecom. Association v. FBI, *et al*., No. 00-5386.

[^37]: 68 Fed. Reg. 68,112 (2003).

[^38]: 63 Fed. Reg. 70,160 (1998).

[^39]: 65 Fed. Reg. 40,694 (2000).

[^40]: Sections 103 (concerning assistance capability) and 105
    (concerning system security) took effect four years after the date
    of enactment of CALEA; all other provisions took effect on the date
    of enactment. 47 U.S.C. § 1001(b).

[^41]: *See* 47 U.S.C. §§ 1006(c)(1)-(3).

[^42]: *CALEA Section 103 Compliance and Section 107(c)(2) Petitions*,
    *Public Notice*, 15 FCC Rcd 7482 (2000).

[^43]: *The Common Carrier and Wireless Telecommunications Bureaus
    Establish Procedures for Carriers to Submit or Supplement CALEA
    Section 107(c)(2) Extension Petitions, both Generally and with
    Respect to Packet-Mode and Other Safe Harbor Standards*, CC Docket
    No. 97-213, *Public Notice*, 16 FCC Rcd 17101 (2001) (*9/28/01
    Public Notice*).

[^44]: *The Wireline Competition and Wireless Telecommunications Bureaus
    Announce a Revised Schedule for Consideration of Pending Packet Mode
    CALEA Section 107(c) Petitions and Related Issues*, CC Docket No.
    97-313, 2003 WL 22717863, *Public Notice*, 22 FCC Daily Dig. 220
    (rel. Nov. 19, 2003) (*11/19/03 Public Notice*).

[^45]: Congress authorized appropriations totaling \$500 million for
    fiscal years 1995 through 1998. 47 U.S.C. § 1009. The Attorney
    General shall allocate funds appropriated to carry out this title in
    accordance with law enforcement priorities determined by the
    Attorney General. 47 U.S.C. § 1008(e).

[^46]: 47 U.S.C. § 1008(a).

[^47]: 47 U.S.C. § 1008(d).

[^48]: 63 Fed. Reg. 23,231 (1998).

[^49]: 66 Fed. Reg. 50931 (2001).

[^50]: There are RTU licenses with AG Communications Systems, Lucent
    Technologies, Motorola, Nortel Networks, and Siemens AG.

[^51]: Those factors are (1) the effect on public safety and national
    security; (2) the effect on rates for basic residential telephone
    service; (3) the need to protect the privacy and security of
    communications not authorized to be intercepted; (4) the need to
    achieve the capability assistance requirements of section 103 by
    cost-effective methods; (5) the effect on the nature and cost of the
    equipment, facility, or service at issue; (6) the effect on the
    operation of the equipment, facility, or service at issue; (7) the
    policy of the United States to encourage the provision of new
    technologies and services to the public; (8) the financial resources
    of the telecommunications carrier; (9) the effect on competition in
    the provision of telecommunications services; (10) the extent to
    which the design and development of the equipment, facility, or
    service was initiated before January 1, 1995; and (11) such other
    factors as the Commission determines are appropriate. 47 U.S.C. §
    1008(b)(1).

[^52]: 47 U.S.C. § 1008(b)(2). Subsection 109(e) sets forth the
    regulations necessary to effectuate timely and cost-efficient
    payment to carriers that are entitled to compensation under this
    title. 47 U.S.C. § 1008(e).

[^53]: 28 C.F.R. pt. 100 (1997); see also 64 Fed. Reg. 72,689 (1999) and
    65 Fed. Reg. 13,792 (2000).

[^54]: 47 U.S.C. § 229(a).

[^55]: 47 U.S.C. § 1004. Subsection 229(b) states that the Commission
    shall prescribe rules to implement section 105 that require common
    carriers to establish policies and procedures for officers and
    employees to perform interceptions or access call-identifying
    information, to maintain secure and accurate records of
    interceptions, and to file with the Commission descriptions of the
    policies and procedures it has put in place. Subsections 229 (c) and
    (d) provide the Commission with authority to review and modify
    carriers' policies and procedures and to impose penalties on
    carriers that violate their system security and integrity
    provisions. 47 U.S.C. §§ 229(b), 229(c), 229(d).

[^56]: *See Communications Assistance for Law Enforcement Act*, CC
    Docket No. 97-213, *Report and Order*, 14 FCC Rcd 4151 (1999),
    *recon. sua. sponte*, *Order on Reconsideration*, 15 FCC Rcd 20735
    (2000).

[^57]: 47 U.S.C. § 229(e)(1).

[^58]: 47 U.S.C. § 229(e)(2).

[^59]: ^?^47 U.S.C. § 1007(a). Subsection 108(b) states that, upon
    issuing an order, the court must specify a reasonable time and
    conditions for complying with its order, considering good faith
    efforts to comply in a timely manner, any effect on the carrier\'s,
    manufacturer\'s, or service provider\'s ability to continue to do
    business, the degree of culpability or delay in undertaking efforts
    to comply, and such other matters as justice may require. 47 U.S.C.
    § 1007(b). Subsection 108(c) states that a court order may not --

    > \(1\) require a telecommunications carrier to meet the
    > Government\'s demand for interception of communications and
    > acquisition of call-identifying information to any extent in
    > excess of the capacity for which the Attorney General has agreed
    > to reimburse such carrier;
    >
    > \(2\) require any telecommunications carrier to comply with the
    > assistance capability requirements of section 103 if the
    > Commission has determined that compliance is not reasonably
    > achievable, unless the Attorney General has agreed to pay the
    > costs described in section 109(b)(2)(a); or

    \(3\) require a telecommunications carrier to modify, for the
    purpose of complying with the assistance capability requirements of
    section 103, any equipment, facility, or service deployed on or
    before January 1, 1995, unless (a) the Attorney General has agreed
    to pay the telecommunications carrier for all reasonable costs
    directly associated with modifications necessary to bring the
    equipment, facility, or service into compliance with those
    requirements, or (b) the equipment, facility, or service has been
    replaced or significantly upgraded or otherwise undergoes major
    modification. 47 U.S.C. § 1007(c).

[^60]: Petition at iii-iv.

[^61]: *Id*. at 5.

[^62]: *Id*. at 6-8.

[^63]: *Id*. at 8-9. As discussed in n.Error: Reference source not
    found, *supra*, the Commission recently initiated a rulemaking
    proceeding to explore the appropriate legal and regulatory framework
    for various IP-enabled services*.* *See* also discussion, section
    III.B. *infra*, on the applicability of CALEA to new technologies
    and services.

[^64]: ^?^The Petition was placed on *Public Notice* on March 12, 2004.
    *See Comment Sought on CALEA Petition for Rulemaking,* RM-10865, DA
    04-700. Comments were due by April 12, 2004, and reply comments were
    due by April 27, 2004. Commenting parties can generally be
    identified as LEAs, cable organizations, Internet and broadband
    companies/organizations, privacy and public interest groups,
    standards and technology groups, wireless companies/ organizations,
    and wireline companies/organizations.

[^65]: ^?^*See*, *e.g.*, Comments of Cape May Prosecutor's Office,
    Illinois State Police ("ILSP"), International Association of Chiefs
    of Police, Los Angeles County Regional Criminal Information
    Clearinghouse ("LA Clear"), Major Cities Chiefs Association,
    Maryland State Police ("MSP"), National District Attorneys
    Association ("NDAA"), National Narcotic Officers Association
    Coalition, National Sheriffs\' Association, New Jersey State Police,
    New York State Attorney General's Office ("NYSAG"), Oklahoma State
    Bureau of Narcotics and Dangerous Drug Control, Police Executive
    Research Forum, Tennessee Bureau of Investigation, and Texas
    Department of Public Safety.

[^66]: *See*, *e.g.*, Comments of American Civil Liberties Union
    ("ACLU") at 1; AT&T Corp. ("AT&T") at 3; BellSouth Corporation
    ("BellSouth") at 5-7; Electronic Frontier Foundation ("EFF") at 5;
    Electronic Privacy Information Center ("EPIC") at 9; Global Crossing
    North America ("Global Crossing") at 17; Information Technology
    Industry Council ("ITIC") at 2-3; Satellite Industry Association
    ("SIA") at 3, 15-18; SBC at 5-7; Sprint Corporation ("Sprint") at
    2-3, 5-11; United States Telecom Association ("USTA") at 2-6.

[^67]: *See*, *e.g.*, Comments of Cellular Telecommunications and
    Internet Association ("CTIA") at 3; Center for Democracy and
    Technology ("CDT") at iii-iv; SIA at 3-8; Covad Communications
    ("Covad") at 7,13; EFF at 7-8; Global Crossing at 3-5; TIA at 20;
    Voices on the Net Coalition ("VONC") at 13.

[^68]: *See*, *e.g.*, Comments of ACLU at 2; CDT at iv; CTIA at 5; Covad
    at 14-15; EFF at 3; Global Crossing at 9-10; ITIC at 18-19; SIA at
    11-12; TIA at 15-16; USTA at 6-8; VONC at 3.

[^69]: *See*, *e.g.*, Comments of CDT at 2; EFF at 14; SBC at 7-10.

[^70]: *See*, *e.g.*, Comments of AT&T at 19-20; BellSouth at 13-14;
    CTIA at 22-23; CDT at 29; SIA at 13-14; TIA at 12-13.

[^71]: *See*, *e.g.*, Comments of AT&T at 4-5; BellSouth at 9; CTIA at
    5, 25-26; CDT at 30; Covad at 18-19; EFF at 3, 18; EPIC at 2-8;
    Global Crossing at 15; Leap Wireless International, Inc. ("Leap") at
    6-10; Rural Iowa Independent Telephone Association ("RIITA") at 1-2;
    SBC at 2; TIA at 25.

[^72]: Petition at 15.

[^73]: *Id*. at 15-16.

[^74]: *Id.* at 16.

[^75]: *Second R&O*, *supra* n.Error: Reference source not found at 7120
    n.69.

[^76]: The FBI subsequently terminated the Flexible Deployment Program
    for packet-mode. *See also* discussion at ¶ 103, *infra*.

[^77]: The Commission has used the term "broadband" to signify "advanced
    telecommunications capability and advanced services," which we
    defined, for the purposes of Section 706 Reports, as those services
    having the capability to support both upstream and downstream speeds
    in excess of 200 kbps in the last mile. *Inquiry Concerning the
    Deployment of Advanced Telecommunications Capability to All
    Americans in a Reasonable and Timely Fashion, and Possible Steps to
    Accelerate Such Deployment Pursuant to Section 706 of the
    Telecommunications Act of 1996*, CC Docket No. 98-146, *Third
    Report*, 17 FCC Rcd 2844, 2850-52, ¶ 9 (2002) (*Third Section 706
    Report*); *accord Inquiry Concerning the Deployment of Advanced
    Telecommunications Capability to All Americans in a Reasonable and
    Timely Fashion, and Possible Steps to Accelerate Such Deployment
    Pursuant to Section 706 of the Telecommunications Act of 1996*, CC
    Docket No. 98-146, *Second Report*, 15 FCC Rcd 20913, 20919-20, ¶ 10
    (2000) (*Second Section 706 Report*). The Commission also has
    "denominate\[d\] as 'high-speed' those services with over 200 kbps
    capability in at least one direction." *Second Section 706 Report*,
    15 FCC Rcd at 20920, ¶ 11; *accord Third Section 706 Report*, 17 FCC
    Rcd at 2850-51, ¶ 9. *See also IP-Enabled Services Notice*, 19 FCC
    Rcd 4865, n.3.

[^78]: Internet Protocol is the most commonly used language at the
    network layer of packet-mode architecture to route data between
    hosts over one or several networks.

[^79]: *See supra* ¶ 35 (defining "broadband Internet access service"
    for purposes of this proceeding). By "facilities-based," we mean
    entities that provide transmission or switching over their own
    facilities between the end user and the Internet Service Provider.
    We seek comment on this approach.

[^80]: We clarify that some entities that sell or lease mere
    transmission facilities on a non-common carrier basis, *e.g.*, dark
    fiber, bare space segment capacity or wireless spectrum, to other
    entities that use such transmission capacity to provide a broadband
    Internet access service, are not subject to CALEA under the
    Substantial Replacement Provision as broadband Internet access
    providers. Under such a scenario, the entity procuring the
    transmission capacity via the sale or lease and using it to provide
    broadband Internet access service (*e.g*., a satellite earth station
    licensee) would be considered the facilities-based broadband
    Internet access service provider and thus, the entity subject to
    CALEA under the Substantial Replacement Provision.

[^81]: *See* Petition at 15-16, 23-28. We note that in other dockets,
    the Commission previously requested and received comment on the
    applicability of CALEA to wireline broadband Internet access service
    and has received comment on its applicability to cable modem
    service. *See Appropriate Framework for Broadband Access to the
    Internet over Wireline Facilities*, *Universal Service Obligations
    of Broadband Providers*, CC Docket No. 02-33, *Notice of Proposed
    Rulemaking*, 17 FCC Rcd 3019 (2002) (*Wireline Broadband* *NPRM*);
    *see also* *supra* ¶ 35 (summarizing the fact that this proceeding
    encompasses the issue of the applicability of CALEA to wireline
    broadband Internet access previously raised in WC Docket No. 02-33);
    *Inquiry Concerning High-Speed Access to the Internet Over Cable and
    Other Facilities, Internet Over Cable Declaratory Ruling,
    Appropriate Regulatory Treatment for Broadband Access to the
    Internet Over Cable Facilities*, GN Docket No. 00-185 and CS Docket
    No. 02-52, *Declaratory Ruling and Notice of Proposed Rulemaking*,
    17 FCC Rcd 4798 (2002) (*Cable Modem Declaratory Ruling & NPRM*),
    *aff'd in part, vacated in part, and remanded*, *Brand X Internet
    Services v. FCC*, 345 F.3d 1120 (9th Cir. 2003), stay granted
    pending cert. (April 9, 2004) (cable modem service constitutes the
    offering of both an information service and a telecommunications
    service to the end user). Parties that commented on CALEA issues in
    these dockets should respond to the instant docket.

[^82]: Broadband Internet access services are rapidly being developed or
    provided over technologies other than wireline and cable, such as
    wireless and powerline. For example, broadband Internet access
    service may be provided by CMRS carriers and fixed wireless
    companies such as local multipoint distribution service and 39 GHz
    licensees, or by wireless Internet Service Providers using
    unlicensed spectrum. *See*, *e.g.,* *FCC Chairman Michael K. Powell
    announces Formation Of Wireless Broadband Access Task Force,* News
    Release (May 5, 2004); *Wireless Broadband Access* *Task Force Seeks
    Public Comment On Issues Related To Commission's Wireless Broadband
    Policies*, GN Docket No. 04-163, *Public Notice,* 19 FCC Rcd 8166
    (2004). Broadband over powerline ("BPL") is a new technology being
    developed at a rapid pace to offer voice and high-speed data
    capabilities. *See, e.g.*, *Inquiry Regarding Carrier Current
    Systems, Including Broadband over Power Line Systems*, ET Docket No.
    03-104, *Notice of Inquiry*, 18 FCC Rcd 8498 (2003) (seeking comment
    on technical issues relating to provision of BPL); *see also
    generally* United Power Line Council ("UPLC") Comments at 1-2.

[^83]: *See* Petition at 16-17, n. 39.

[^84]: *Id.* (describing the various functions performed by a call
    mediator in a managed VoIP service); *see also* *Petition for
    Declaratory Ruling that pulver.com's Free World Dialup is Neither
    Telecommunications Nor a Telecommunications Service*, WC Docket No.
    03-45, *Memorandum Opinion and Order*, 19 FCC Rcd 3307 (2004)
    (*Pulver.com Declaratory Ruling*) at 3309-3310, ¶¶ 5-6
    (distinguishing Pulver's peer-to-peer Free World Dialup service from
    a managed VoIP service).

[^85]: *See* Petition at 2, 25, 71; Law Enforcement Reply Comments at
    iii, 22.

[^86]: H.R. Rep. No. 103-827(I) (1994), *reprinted in* 1994 U.S.C.C.A.N.
    3489 (*House Report*) (Summary and Purpose) (emphasis added); *see
    also* Petition at iii.

[^87]: *See Second R&O*, *supra* n.Error: Reference source not found at
    7111, 7114-15; ¶¶ 10, 17 (finding entities deemed to be common
    carriers under the Communications Act, including cable operators,
    electric and other utilities that offer telecommunications services
    to the public; CMRS providers interconnected to the public switched
    telephone network, private mobile radio service providers to the
    extent they offer common carrier service; resellers; joint-use
    facilities; and adjunct-to-basic services are all subject to CALEA);
    *see also* *House Report* at 23, *reprinted in* 1994 U.S.C.C.A.N.
    3489, 3500 (listing numerous types of service providers that
    Congress explicitly intended to fall within its definition of
    "telecommunications carrier" under CALEA). Each of the entities
    identified in the *House Report* is a telecommunications carrier,
    *i.e*., a common carrier, under the Communications Act. *See* *Cable
    & Wireless, PLC, Order*, 12 FCC Rcd 8516, 8521, ¶ 13 (1997); *see
    also Virgin Islands Tel. Corp. v. FCC*, 198 F.3d 921, 926-27 (D.C.
    Cir. 1999) (stating that the 1996 Act's definition of
    telecommunications service equates to common carrier service).

[^88]: Law Enforcement correctly notes that the application of CALEA is
    technology neutral and commenters are reminded of this fact. *See*
    Petition at iii, 13; *see also supra* ¶ 33 (indicating that the
    Commission has acknowledged that CALEA is technology neutral). We
    further stress that these carriers remain subject to CALEA
    regardless of whether accepted industry standards or safe harbors
    have been adopted for their respective technologies. *See infra*
    section III.C. (discussing capability requirements and the role of
    standards). Thus, to be clear, to the extent any packet-based or
    broadband services are currently telecommunications services under
    the Communications Act or subsequently determined to be
    telecommunications services under the Communications Act, those
    services and the entities providing them are subject to CALEA
    pursuant to sections 102(8)(A) and (8)(B)(i).

[^89]: As noted above, LEAs may obtain a court warrant for wiretaps of
    electronic communications services under a number of laws. *See,
    e.g.,* Electronic Communications Privacy Act of 1986, Pub. L.
    99-508, 100 Stat. 1848 (1986) (codified, as amended, at 18 U.S.C. §§
    2701 *et seq.*, 3121 *et seq*; *see U.S. v. Kennedy*, 81 F. Supp. 2d
    1103 (D. Kan. 2000) (granting government's application for an order
    to disclose consumer information); *In re Application of the United
    States of America for an Order pursuant to 18 U.S.C. 2703(d)*, 36 F.
    Supp. 2d 430 (D. Mass. 1999) (same); Omnibus Crime Control and Safe
    Streets Act of 1968, Pub. L. 90-351, 82 Stat. 212 (1968) (codified,
    as amended, at 18 U.S.C. §§ 22510 *et seq.*); Foreign Intelligence
    Surveillance Act of 1978, Pub. L. 95-511, 92 Stat. 1783 (1978)
    (codified, as amended, at 50 U.S.C. §§ 1801 *et seq.* and 1841 *et
    seq.*); Pen Registers and Trace Devices, 18 U.S.C. §§ 3121 *et
    seq.*; USA PATRIOT Act of 2001, Pub. L. 107-56, 115 Stat. 272
    (2001); *see also Second R&O*, *supra* n.Error: Reference source not
    found at 7112, ¶ 12 (citing *House Report*, 1994 U.S.C.C.A.N. at
    3498); Worldcom Comments at 4.

[^90]: 47 U.S.C. § 1002.

[^91]: *See infra* section III.C.

[^92]: CALEA requires telecommunications carriers to ensure that
    "equipment, facilities or services" that provide a customer or
    subscriber with the ability to originate, terminate, or direct
    communications are capable of providing authorized surveillance to
    LEAs. *See* 47 U.S.C. § 1002(a).

[^93]: *See supra* ¶ 7. Law Enforcement states that the scope of CALEA's
    definition of "telecommunications carrier" is broader than, and does
    not rely upon, the definition of "telecommunications carrier" in the
    Communications Act. *See* Petition at 9; Law Enforcement Reply
    Comments at 29; *see also* Verizon Comments at 4; NYSAG Comments at
    13. Certain commenters, on the other hand, insist that the
    definitions in the two statutes must be interpreted identically.
    *See, e.g.,* ISP CALEA Coalition ("ISPCC") Comments at 15-18;
    Earthlink, Inc. ("Earthlink") Comments at 4-5; Global Crossing
    Comments at 3-4; ITI Comments at 5-6; Covad Comments at 8-9; AT&T
    Comments at 10-12; Level 3 Communications, LLC ("Level 3") Reply
    Comments at 3-4; Industry at 3; Warriner, Gesinger & Associates, LLC
    Comments at 2-3, 5.

[^94]: CALEA provides that the term "telecommunications carrier":

    \(A\) means a person or entity engaged in the transmission or
    switching of wire or electronic communications as a common carrier
    for hire; and

    > \(B\) includes --
    >
    > \(i\) a person or entity engaged in providing commercial mobile
    > service (as defined in section 332(d) of the Communications Act of
    > 1934 (47 U.S.C. 332(d))); or
    >
    > \(ii\) a person or entity engaged in providing wire or electronic
    > communication switching or transmission service to the extent that
    > the Commission finds that such service is a replacement for a
    > substantial portion of the local telephone exchange service and
    > that it is in the public interest to deem such a person or entity
    > to be a telecommunication carrier for purposes of this title; but

    \(C\) does not include \--

    > \(i\) persons or entities insofar as they are engaged in providing
    > information services; and
    >
    > \(ii\) any class or category of telecommunications carriers that
    > the Commission exempts by rule after consultation with the
    > Attorney General.

    47 U.S.C. § 1001(8).

[^95]: *See infra* section III.B.1.a.(i) (discussing the Substantial
    Replacement Provision); *supra* ¶ 7 (noting, among other things,
    that unlike the Communications Act definition, CALEA's definition of
    telecommunications carrier includes an entity engaged in
    "transmission *or switching"*). 47 U.S.C. § 1001(8)(A) (emphasis
    added).

[^96]: *See* *Second R&O*, *supra* n.Error: Reference source not found
    at 7112, ¶ 13; *see also* AT&T Comments at 10-12.

[^97]: *See Second R&O*, *supra* n.Error: Reference source not found at
    7112, ¶ 13 (emphasis added).

[^98]: 47 U.S.C. § 1001(8)(B)(ii).

[^99]: *See Second R&O*, *supra* n.Error: Reference source not found at
    7120, ¶ 29.

[^100]: The initial CALEA *Notice of Proposed Rulemaking* ("*NPRM*")
    asked commenters to identify any cases they believed warranted
    Commission action under section 102(8)(B)(ii) to the extent those
    commenters disagreed with the Commission's proposal in the *NPRM* to
    decline to exercise its discretion under section 102(8)(B)(ii) at
    that time. *Communications Assistance for Law Enforcement Act*, CC
    Docket No. 97-213, *Notice of Proposed Rulemaking*, 13 FCC Rcd 3149
    (1998) at 3162, ¶ 18.

[^101]: 47 U.S.C. § 1001(8)(B)(ii); *see also* 47 U.S.C. § 1001(8)(A).

[^102]: *See* 47 U.S.C. § 1002(a); *House Report*, 1994 U.S.C.C.A.N. at
    3498 (Narrow Scope Section).

[^103]: *See* Harry Newton, *Newton's Telecom Dictionary* 687-88 (19th
    ed. 2003) (definition of "router"); *id.* at 738 (definition of
    "softswitch"). While equipment that provides addressing or
    intelligence functions may not technically be switching or
    transmission equipment, access to such equipment may be essential
    for LEAs to access call-identifying information to which they are
    entitled.

[^104]: Law Enforcement asserts that a change in form or content is
    irrelevant for CALEA as long as a transmission or switching function
    exists. *See* Petition at 13. We agree. We note that the term
    "telecommunications" under the Communications Act requires "the
    transmission, between or among points specified by the user, of
    information of the user\'s choosing, without change in the form or
    content of the information as sent and received." 47 U.S.C. §
    153(43).

[^105]: The Commission has recently recognized that a number of new
    packet-based service offerings are currently available and it is not
    clear which of those services involve "a change in the form or
    content of the information as sent or received," for purposes of the
    Communications Act. For example, the Commission has tentatively
    concluded that wireline broadband Internet access service is an
    information service under the Communications Act when provided over
    an entity's own facilities, and that the underlying transmission
    component of such service constitutes "telecommunications" and not a
    "telecommunications service" under the Communications Act. *See
    Wireline Broadband* *NPRM*, *supra* n.Error: Reference source not
    found at 3032-33, ¶¶ 24-25. In addition, the Commission has recently
    determined the legal classification *under the Communications Act*
    of two different types of VoIP offerings. *See* P*ulver.com
    Declaratory Ruling*, *supra* n.Error: Reference source not found
    (declaring pulver's Internet application, Free World Dialup, an
    information service because, *inter alia*, it changes the form of
    the information as sent and received); *Petition for Declaratory
    Ruling that AT&T's Phone-to-Phone IP Telephony Services are Exempt
    from Access Charges*, WC Docket No. 02-361, *Order*, 19 FCC Rcd 7457
    (2004) (*AT&T Declaratory Ruling*) (declaring AT&T's
    IP-in-the-middle long distance service a telecommunications
    service); *see also IP-Enabled Services* *Notice,* *supra* n.Error:
    Reference source not found at 4886-4890, ¶¶ 35-37 (seeking comment
    on a broad range of IP-enabled services and the appropriate legal
    classification under the Communications Act).

[^106]: While we read CALEA as enabling a determination of substantial
    replacement to apply on an individual basis, we inquire whether the
    phrase "within a state" which appears in the accompanying *House
    Report* has any material significance to our determination of
    whether a service is a substantial local exchange replacement. *See*
    *House Report*, 1994 U.S.C.C.A.N at 3500 (Section-by-Section
    Analysis). *Compare* Verizon Comments at 5 n.3 (indicating that
    "replacement for a substantial portion" can not reasonably be
    construed to impose market share or geographical reach; it can only
    reasonably be understood in functional terms) *with* ISPCC Comments
    at 20-21; Net2Phone Reply at 14 (asserting that substantial
    replacement for CALEA means actual replacement for all aspects of
    traditional legacy local exchange service in a particular state, not
    simply a portion of local service functionality for certain
    individuals); *see also* AT&T Comments at 16-17; Industry and Public
    Interest ("IPI") Reply Comments at 4.

[^107]: *See* H.R. Rep. No. 103-827(I) (1994), *reprinted in* 1994
    U.S.C.C.A.N. 3489 (*House Report*) (Summary and Purpose) (stating
    "The purpose of H.R. 4922 is to preserve the government's ability,
    pursuant to court order or other lawful authorization, to intercept
    communications involving advanced technologies such as digital or
    wireless transmission modes...".); *see also supra* ¶ 3; NYSAG
    Comments at 2 (indicating that the focus of CALEA was the
    preservation of surveillance capability in the changing
    communications marketplace).

[^108]: Law Enforcement suggests that packet networks may ultimately
    supplant circuit-switched networks altogether. *See* Petition at 18.

[^109]: The Communications Act uses the term "telephone exchange
    service" as one of the services listed in the definition of "local
    exchange carrier." *See* 47 U.S.C. § 153(26) (identifying "telephone
    exchange service" and "exchange access" as the two services for
    which the provider is considered a "local exchange carrier" under
    the Communications Act). The term "local exchange carrier" means
    "any person that is engaged in the provision of telephone exchange
    service or exchange access. Such term does not include a person
    insofar as such person is engaged in the provision of a commercial
    mobile service under [section
    332(c)](http://web2.westlaw.com/find/default.wl?DB=1000546&DocName=47USCAS332&FindType=L&ReferencePositionType=T&ReferencePosition=SP%3B4b24000003ba5&AP=&RS=WLW4.02&VR=2.0&FN=_top&SV=Split&MT=Westlaw)
    of this title, except to the extent that the Commission finds that
    such service should be included in the definition of such term."
    *Id.* The term "telephone exchange service" means (A) service within
    a telephone exchange, or within a connected system of telephone
    exchanges within the same exchange area operated to furnish to
    subscribers intercommunicating service of the character ordinarily
    furnished by a single exchange, and which is covered by the exchange
    service charge, or (B) comparable service provided through a system
    of switches, transmission equipment, or other facilities (or
    combination thereof) by which a subscriber can originate and
    terminate a telecommunications service." 47 U.S.C. § 153(47). The
    definition of "telephone exchange service" was expanded after CALEA
    was enacted to include the subsection (B) "comparable service"
    clause but subsection (A), as well as the definition of "exchange
    access," were not modified by the 1996 Act. *See* 47 U.S.C. §153
    (16), (47).

[^110]: *See* 47 U.S.C. § 153(16) (definition of "exchange access"). The
    term "exchange access" means "the offering of access to telephone
    exchange services or facilities for the purpose of the origination
    or termination of telephone toll services." *Id.*

[^111]: *See Amendments of Part 69 of the Commission's Rules Relating to
    Enhanced Service Providers*, CC Docket No. 87-215, *Order*, 3 FCC
    Rcd 2631 (1988) at 2631, ¶ 2 (explaining how the local telephone
    exchange is used for accessing enhanced services).

[^112]: *See IP-Enabled Services Notice*, *supra* n.Error: Reference
    source not found at 4870, ¶ 9 n.32.

[^113]: We note that the term "replacement" is sometimes equated with
    the economic concept of substitutability. In strict economic terms,
    "substitutes" are services exhibiting positive cross-elasticity of
    demand. That is, two services are "substitutes" in the economic
    sense if demand for one rises when the price for the other
    increases, and falls when the price for the other drops. *See,
    e.g.*, Steven E. Landsburg, *Price Theory and Applications* 108 (3d
    ed. 1995). In considering the type of "replacement" contemplated
    under the Substantial Replacement Provision, we do not believe
    Congress intended "economic substitutability" to define this term,
    but, rather functional substitutability. *See* *IP-Enabled Services
    Notice*, *supra* n.Error: Reference source not found at 4887, ¶ 37
    (addressing functional substitutability and economic
    substitutability). We ask whether commenters agree and whether there
    are considerations other than substitutability that we should
    consider. For example, one commenter claims the Commission must
    construe the phrase "substantial portion" for CALEA purposes the
    same way it has construed the phrase in the context of the
    definition of "commercial mobile service" under section 332(d)(1) of
    the Communications Act. 47 U.S.C. § 332(d)(1); *see* *Implementation
    of Sections 3(n) and 332 of the Communications Act Regulatory
    Treatment of Mobile Services*, GN Docket 93-252, *Second Report and
    Order*, 9 FCC Rcd 1411 (1994) at 1427-31, ¶¶ 61-70 (*CMRS Second
    Report and Order*); *see* Earthlink Comment at 9-10. We note,
    however, that section 332(d)(1) was specifically interpreted for
    purposes of the Communications Act, and we have already established
    that the meaning of certain terms for the Communications Act and
    CALEA are different. Moreover, the phrase "substantial portion" in
    section 332 precedes the phrase "of the public" suggesting a more
    quantitative interpretation than necessarily required for CALEA
    purposes. In CALEA, the phrase precedes "of the local telephone
    exchange service." Thus, despite the fact that CALEA's legislative
    history uses the phrase "substantial portion of the public," when
    discussing the Substantial Replacement Provision, the language
    included in the statute differs from the language in section 332(d).
    We also remind commenters that even when defining the "public" for
    purposes of applying the Communications Act's Title II requirements
    to telecommunications carriers, courts and the Commission have
    recognized that the "public" need not include everyone and carriers'
    offerings may be limited to only certain categories of users and
    still be considered available to the "public." *See* *Nat'l Ass'n of
    Regulatory Util. Comm'rs v. FCC*, 525 F.2d 630, 642 (D.C. Cir.
    1976).

[^114]: *See* Petition at 16-17 n. 39, 22, 29; *see also* NYSAG Comments
    at 16-17.

[^115]: *See, e.g.,*Verizon Comments at 4.

[^116]: *See* *House Report*, 1994 U.S.C.C.A.N at 3501
    (Section-by-Section Analysis) (indicating that the Commission "shall
    consider whether such determination would promote competition,
    encourage the development of new technologies, and protect public
    safety and national security"). *Id*. at 31.

[^117]: *See* Petition at 9-15.

[^118]: 47 U.S.C. § 1001(8)(A) (emphasis added).

[^119]: *See* 47 U.S.C. § 153(43). The term "telecommunications" means
    "the transmission, between or among points specified by the user, of
    information of the user\'s choosing, without change in the form or
    content of the information as sent and received." *Id*.

[^120]: *See* 47 U.S.C. § 153(46). The term "telecommunications service"
    means "the offering of telecommunications for a fee directly to the
    public, or to such classes of users as to be effectively available
    directly to the public, regardless of the facilities used. *Id*.

[^121]: *See* 47 U.S.C. § 153(44). The term "telecommunications carrier"
    means "any provider of telecommunications services, except that such
    term does not include aggregators of telecommunications services (as
    defined in [section
    226](http://web2.westlaw.com/find/default.wl?DB=1000546&DocName=47USCAS226&FindType=L&AP=&RS=WLW4.02&VR=2.0&FN=_top&SV=Split&MT=Westlaw)
    of this title). A telecommunications carrier shall be treated as a
    common carrier under this chapter only to the extent that it is
    engaged in providing telecommunications services, except that the
    Commission shall determine whether the provision of fixed and mobile
    satellite service shall be treated as common carriage." *Id*.

[^122]: We explore the scope and meaning of "switching" for purposes of
    CALEA in ¶ 43, *supra* (analyzing the Substantial Replacement
    Provision).

[^123]: 47 U.S.C. § 1001(8)(A).

[^124]: *See* 47 U.S.C. § 153(43).

[^125]: *See* 47 U.S.C. § 1002(a); *see also* *House Report*, 1994
    U.S.C.C.A.N. at 3498 (Narrow Scope Section). Nothing in CALEA
    appears to prevent an entity that combines "transmission or
    switching" with the data processing enhancements to be subject to
    CALEA with respect to the "transmission or switching" capabilities.

[^126]: The version of the proposed CALEA statute that was reported by
    Committee for approval with the *House Report* just prior to
    enactment by Congress was modified to remove a specific reference to
    the Communications Act's definition of common carrier. *See House
    Report*, 1994 U.S.C.C.A.N. at 3500 (including the phrase "within the
    meaning of section 3(h) of the Communications Act," which was
    ultimately deleted from the definition when enacted as section
    102(8)(A)). Section 3(h) was the definition of "common carrier" or
    "carrier" under the Communications Act prior to the 1996 Act. The
    definition of "common carrier" is now found in section 3(10). 47
    U.S.C. § 153(10). Under both the original section 3(h) definition
    and the current section 3(10) definition, common carrier meant "any
    person engaged as a common carrier for hire, in interstate or
    foreign communication by wire or radio or in interstate or foreign
    radio transmission of energy, except where reference is made to
    common carriers not subject to this chapter; but a person engaged in
    radio broadcasting shall not, insofar as such person is so engaged,
    be deemed a common carrier." 47 U.S.C.A. § 153(h) (1995). We note
    that a similar reference to the Communications Act with respect to
    the definition of a CMRS provider *was not*, however, omitted from
    the version of the definition of CMRS as reported and enacted. *See*
    47 U.S.C. § 1001(8)(B)(i). If Congress had intended the CALEA
    definition of "telecommunications carrier" to mirror the definition
    of "common carrier" under the Communications Act or as interpreted
    under the Commission's rules, it could have specifically indicated
    so as it did in the case of CMRS in section 102(8)(B)(i). *See* 47
    U.S.C. § 1001(8)(B)(i).

[^127]: *See* Petition at 15-32; Law Enforcement Reply Comments at 12;
    NYSAG Comments at 5-6; VeriSign, Inc. ("VeriSign") Comments at
    12-13.

[^128]: Petition at 15-32.

[^129]: *See, e.g.*, Earthlink Comments at 16-18; SBC Comments at 5;
    Cisco Systems, Inc. Reply Comments at 2; Southern Communications
    Services, Inc. Reply Comments at 3-5; UPLC Comments at 6-7; ITI
    Comments at 3 & n.40; VONC Comments at 2; SIA Comments at 15-18.

[^130]: *See infra* ¶ 49.

[^131]: ^?^We acknowledge that including all facilities-based broadband
    Internet access providers within the scope of CALEA could be said to
    depart from our prior statement that when an entity uses its own
    facilities "to distribute an information service only, the mere use
    of transmission facilities would not make the offering subject to
    CALEA as a telecommunications service." *Second R&O*, *supra*
    n.Error: Reference source not found at 7120, ¶ 27. This prior
    determination, however, was based on applying CALEA at that time to
    telecommunications services as defined by the Communications Act
    absent consideration of the meaning and intent of the Substantial
    Replacement Provision or Congress's intent to expand the universe of
    entities deemed "telecommunications carriers" under CALEA. Given the
    more in-depth inquiry and analysis into certain of CALEA's statutory
    provisions that we are undertaking, for the first time, in this
    proceeding, as well as the legislative history that informs our
    analysis, we believe that our current view is compelled by CALEA and
    the public interest. We further note, that the Commission made this
    statement in the context of discussing the "joint use" rule and
    recognizing that when the same facilities support *both*
    CALEA-subject services and non-CALEA-subject services, the
    facilities that support the non-CALEA subject services end up
    subject to CALEA "in order to ensure the ability to surveil the
    telecommunications services" provided over the same facilities. *See
    id.*

[^132]: *See* *generally supra* ¶¶ 40-44; *see also supra* ¶ 45
    (specifically identifying the three public interest factors --- to
    "promote competition, encourage the development of new technologies,
    and protect public safety and national security" --- which CALEA's
    legislative history indicates the Commission shall consider); *see
    also* Verizon Comment at 8 (asserting that finding these services
    subject to CALEA is in the public interest).

[^133]: We note that establishments acquiring broadband Internet access
    to permit their patrons to access the Internet do not appear to be
    covered by CALEA (assuming they were otherwise "telecommunications
    carriers" under CALEA). Examples of these entities include schools,
    libraries, hotels, coffee shops, etc. *See e.g*., American
    Association of Community Colleges *et al.* Comments at 15-20
    (discussing the deterrent effect and cost of potential CALEA
    obligations). The underlying facilities-based broadband transmission
    providers that sell the broadband access service to these
    establishments to enable Internet access for their patrons would,
    however, be responsible for CALEA obligations under our tentative
    conclusion and thus Law Enforcement's needs would be addressed
    through these providers. *See, e.g.,* T-Mobile USA, Inc. Reply
    Comments at 6-8 (discussing Wi-Fi Hotspots^SM^ it provides to
    certain establishments). We seek comment on this analysis.

[^134]: *See, e.g.,* IPI Reply Comments at 7; ITI Comments at 4; Global
    Crossing Comments at 2; Covad Comments at 3-4; s*ee also* AT&T
    Comments at 5-6; ISPCC Comments at 5; Time Warner Telecom, Inc.
    ("TWT") Reply Comments at 2; United States Cellular Corporation
    Reply Comments at 2-3; VONC Comments at 15-16; Vonage Holdings Corp.
    ("Vonage") Reply Comments at 1-2; Level 3 Reply Comments at 1-2.

[^135]: *See supra* ¶ 45.

[^136]: *See, e.g.,* RIITA Comments at 2; National Association of State
    Utility Consumer Advocates ("NASUCA") Reply Comments at 6-7;
    National Telecommunications Cooperative Association ("NTCA")
    Comments at 4-5; Concerned CALEA Compliant Carriers ("CCCC")
    Comments at 4 .

[^137]: *See, e.g*., Leap Comments at 5-6, RIITA Comments at 2; *see
    also* UPLC Comments at 7-8; Rural Cellular Association Reply
    Comments at 3.

[^138]: 47 U.S.C. § 1001(6)(B) & (C) (emphasis added). CALEA provides
    that the term "information services":

    \(A\) means the offering of a capability for generating, acquiring,
    storing, transforming, processing, retrieving, utilizing, or making
    available information via telecommunications; and

    \(B\) includes --

    > \(i\) a service the permits a customer to retrieve stored
    > information from, or file information for storage in, information
    > storage facilities;

    \(ii\) electronic publishing; and

    \(iii\) electronic messaging services; but

    \(C\) does not include any capability for a telecommunications
    carrier's internal management, control, or operation of its
    telecommunications network.

    47 U.S.C. § 1001(6). We will refer to this as the "Information
    Services Exclusion."

[^139]: *See* 47 U.S.C. § 1001(8)(C)(i); *see also* 47 U.S.C. §
    1002(b)(2)(A) (stating that CALEA's capability requirements do not
    apply to information services). According to the accompanying *House
    Report*, this exclusion encompasses "Internet service providers or
    services such as Prodigy and America-On-Line." *House Report*, 1994
    U.S.C.C.A.N. at 3498.

[^140]: 47 U.S.C. § 1002(b)(2)(A).

[^141]: Under the Communications Act, "information service" is defined
    as "the offering of a capability for generating, acquiring, storing,
    transforming, processing, retrieving, utilizing, or making available
    information via telecommunications, and includes electronic
    publishing, but does not include any use of any such capability for
    the management, control, or operating of a telecommunications system
    or the management of a telecommunications service." 47 U.S.C. §
    153(20).

[^142]: *See* *Wireline Broadband* *NPRM* and *Cable Modem Declaratory
    Ruling & NPRM*, *supra* n.Error: Reference source not found.

[^143]: *See supra* Section III.B.1.a.

[^144]: *House Report*, 1994 U.S.C.C.A.N at 3503 (indicating that the
    *transmission* of an e-mail message to an enhanced service provider
    that maintains the e-mail service *is* subject to CALEA).

[^145]: *Id.* Congress provided a similar example in voice mail: "The
    storage of a message in a voice mail . . . 'box' is not covered by
    the bill. The redirection of the voice mail message to the 'box' . .
    . \[is\] covered."). *House Report*, 1994 U.S.C.C.A.N at 3503.

[^146]: Furthermore, Congress articulated, consistent with its
    understanding of how CALEA would work, an expectation that LEAs
    "will most likely intercept communications over the Internet at the
    same place it intercepts other electronic communications: at the
    carrier that provides access to the public switched telephone
    network." *Id.* at 3504. We note that digital subscriber line
    offered on a tariffed basis as a telecommunications service is
    already subject to CALEA. *See Second R&O*, *supra* n.Error:
    Reference source not found at 7120, ¶ 27.

[^147]: *See* H.R. Rep. No. 103-827(I) (1994), *reprinted in* 1994
    U.S.C.C.A.N. 3489 (Summary and Purpose); *see, also,* *supra* ¶ 3.

[^148]: *See IP-Enabled Services Notice*, *supra* n.Error: Reference
    source not found, at 4871-79, ¶¶ 10-22; *see* *also* Petition at
    16-17, n.39; NYSAG Comments at 5, n.15.

[^149]: *See supra* ¶ 37 (describing managed VoIP services for purposes
    of this proceeding). VoIP providers such as Vonage; 8x8, Inc.
    ("8x8"); and Level 3 are examples of entities offering these types
    of services.

[^150]: *See* *Pulver.com Declaratory Ruling*, *supra* n.Error:
    Reference source not found.

[^151]: The Petition does not propose to apply CALEA to services such as
    instant messaging or interactive game sessions. Indeed, Congress has
    spoken that these services are excluded from CALEA. *See* 47 U.S.C.
    § 1001(6)(B); *see also* *House Report*, 1994 U.S.C.C.A.N at 3503.

[^152]: *See* Petition at 16 & n.39 (referring to the VoIP services in
    these models as "broadband telephony"). Some commenters other than
    LEAs support Law Enforcement's claim that VoIP services may be
    subject to CALEA. *See, e.g.,* Verizon Comments at 4; TWT Reply
    Comments at 3-4.

[^153]: Petition at 30; *see also* RIITA Comments at 2.

[^154]: *See* Petition at 16 & n.39 (describing the three models and the
    relationship of each to the broadband Internet access provider).
    Specifically, the three models are as follows: (1) Facilities-Based
    VoIP Service where the VoIP provider has its own broadband
    facilities and uses those facilities to offer its customers managed
    VoIP service; (2) "Cooperative" VoIP Application which involves at
    least two providers, a managed VoIP application provider and an
    underlying broadband Internet access provider which, through some
    commercial arrangement offer VoIP to end users; and (3) Stand-alone
    VoIP Application where the managed VoIP application is accessed
    through a "bring your own broadband" connection, *i.e.*, the VoIP
    provider has no relationship to its customers' broadband Internet
    access provider. *Id*.

[^155]: *Id.*

[^156]: *Id.* at 21.

[^157]: *Id.* at 17.

[^158]: *See* Verizon Comments, 2-7; TWT Reply Comments at 3-4; *see
    also* NCTA Reply Comments, at 2, 5-6 & n.9.

[^159]: *See, e.g.,* Skype Comments at 4.

[^160]: *Id. See*, *also*, 8x8, Inc. Reply Comments.

[^161]: *See supra* n.Error: Reference source not found.

[^162]: *See supra* ¶¶ 40-45. Managed VoIP service providers provide
    "subscribers the ability to originate, terminate or direct
    communications" in a manner "that allows the customer to obtain
    access to a publicly switched network." *See* *House Report*, 1994
    U.S.C.C.A.N at 3504 (Section-by-Section Analysis). For the reasons
    stated above, we do not believe CALEA's Information Services
    Exclusion should alter our tentative conclusion. *See supra* ¶¶
    50-52.

[^163]: *See supra* n. Error: Reference source not found.

[^164]: *See e.g.,* NYSAG Comments at 16-17; NDAA Comments at 1-2.

[^165]: *See infra* ¶¶ 65-68.

[^166]: *See supra* n.Error: Reference source not found.

[^167]: 47 U.S.C. § 1002(b)(2)(B); *see also* *House Report*, 1994
    U.S.C.C.A.N at 3498 (Narrow Scope); *Second R&O*, *supra* n.Error:
    Reference source not found at 7112, ¶ 12. We refer commenters to the
    legislative history's discussion of private networks to address to
    what extent this affects the Commission's analysis. *See* *House
    Report*, 1994 U.S.C.C.A.N at 3503 (Section-by-Section Analysis). We
    seek comment on whether there is some point at which certain
    "private" networks, because of an unlimited number of users, may be
    found to be more "public" than "private."

[^168]: *See supra* n.Error: Reference source not found. We make clear
    that we do not, however, solicit comment on packet-based or
    broadband services that are clearly excluded from CALEA such as
    electronic mail.

[^169]: 47 U.S.C. § 151. Federal courts have recognized the Commission's
    authority to promulgate regulations to effectuate the goals and
    accompanying provisions of the Act in the absence of explicit
    regulatory authority, if the regulations are reasonably ancillary to
    the effective performance of the Commission's various
    responsibilities*. See* *United States v. Southwestern Cable Co*.,
    392 U.S. 157, 178 (1968) (*Southwestern Cable*); *see also FCC v.
    Midwest Video Corp*., 440 U.S. 689 (1979); *United States v. Midwest
    Video Corp*., 406 U.S. 649 (1972) (*Midwest Video*); *Promotion of
    Competitive Networks in Local Telecommunications Markets, Wireless
    Commun. Ass'n Int'l, Inc., Petition to Amend Section 1.4000 of the
    Commission's Rules,* WT Docket No. 99-217, CC Docket No. 96-98, and
    CC Docket No. 88-57, *First Report and Order and Further Notice of
    Proposed Rulemaking in WT Docket No. 99-217, Fifth Report and Order
    and Memorandum Opinion and Order in CC Docket No. 96-98, and Fourth
    Report and Order and Memorandum Opinion and Order in CC Docket No.
    88-57,* 15 FCC Rcd 22983 (2000) at 23028-29, ¶ 101 & n.261
    (*Competitive Networks*); *Building Owners and Managers Association
    et al. v. FCC*, 254 F.3d 89 (D.C. Cir. 2001).

[^170]: *See* Petition at 33-34; *see also* Law Enforcement Reply
    Comments at 37-40.

[^171]: *See* Petition at 34.

[^172]: *Id.*; *see also* Law Enforcement Reply Comments at 38-39.

[^173]: *See* ACLU Comments at 2; AT&T Comments at 21-22; BellSouth
    Comments at 19-22; CDT Comments at 29-30; CTIA Comments at 21-23;
    EFF Comments at 11-12; Global Crossing Comments at 10-12; ITIC
    Comments at 23-24; ISPCC Comments at 32-34; MCI Comments at 29-30;
    SIA Comments at 12-13; SBC Comments at 11-12; Sprint Comments at
    12-13; TIA Comments at 18-20; USTA Comments at 7-8; Verizon Comments
    at 10 n.9; IPI Reply Comments at 4; CDT Reply Comments at 3-4; Level
    3 Reply Comments at 7-8; Net2Phone Reply Comments at 16-17.

[^174]: *See* ACLU Comments at 2; AT&T Comments at 21-22; BellSouth
    Comments at 19-22; Ren Bucholz Comments at 1; Robert A. Collinge
    Comments at 1; CTIA Comments at 23; Covad Comments at 14-16; Global
    Crossing Comments at 10-12; ITIC Comments at 23-24; ISPCC Comments
    at 32-34; MCI Comments at 29-30; SIA Comments at 12-13; SBC Comments
    at 11-12; Sprint Comments at 12-13; TIA Comments at 18-20; USTA
    Comments at 8; Verizon Comments at 9; VONC Comments at 10; IPI Reply
    Comments at 4; Level 3 Reply Comments at 7-8; Net2Phone Reply
    Comments at 16-17; Letter from Keith R. McCall, Pennsylvania State
    Representative, to Marlene Dortch, Secretary, Federal Communications
    Commission, RM-10865 at 2 (filed Mar. 29, 2004).

[^175]: *House Report*, 1994 U.S.C.C.A.N. at 3493.

[^176]: *See* 47 U.S.C. §§ 1002(b)(1)(B), 1006(a)(3)(B); *see also*
    *House Report*, 1994 U.S.C.C.A.N. at 3503; Sen. Leahy, 140 Cong.
    Rec. 20,444-45 (Aug. 9, 1994).

[^177]: *See, e.g.,* 47 C.F.R. § 1.2.

[^178]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6907-08, ¶ 34.

[^179]: *Id.* at 6911, ¶ 47. *See also* 47 C.F.R. §§ 22.1102, 24.902,
    64.2202.

[^180]: *Order on Remand supra* n.Error: Reference source not found at
    6911, ¶ 48.

[^181]: In the Open System Interconnection ("OSI") model, layered
    network architecture for packet networks typically consists of seven
    layers: physical, data link, network, transport, session,
    presentation and application. The model calls for the independent
    operation of the layers, and supports the interaction of various
    applications and equipment that is designed to address separately
    each layer in a product offering. In the Transport Control Protocol
    ("TCP")-IP model, only four levels are used: link (combines OSI
    physical and data link levels), network, transport and application
    (combines OSI session, presentation and application levels). The
    functions supported at each layer are as follows:
    *physical*---represents electrical signaling, modulation, etc.;
    *data link*---moves packets (also called "datagrams") between hosts
    based on a protocol such as Ethernet, Asynchronous Transfer Mode,
    frame relay; *network*---defines how data is routed between hosts
    over one or several networks, often based on IP;
    *transport*---establishes the connection between two hosts, creating
    a "virtual" network, often based on TCP or Universal Datagram
    Protocol; *session*---controls the setup and termination of
    communications sessions; *presentation*---defines the format of the
    data exchanged (*e.g.,* text, graphic); *application*---defines how
    applications communicate with each other over the network (*e.g.,*
    e-mail) using various protocols.

[^182]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6926-27, ¶ 80.

[^183]: *Id.*

[^184]: Both VeriSign and Fiducianet, Inc. provide service bureau
    CALEA-compliance functions for telecommunications carriers including
    administration (*e.g*., processing subpoenas), accessing
    communications (*e.g*., call data and call content mediation), and
    delivering information to a LEA.

[^185]: The first model described in Appendix C, which serves as a
    baseline, describes a carrier separating call content and
    call-identifying information that can be delivered directly to a
    LEA. The second model in Appendix C describes a system that uses a
    mediation device. The third model in Appendix C describes an
    external system.

[^186]: VeriSign Comments at 8.

[^187]: TIA Comments at 16.

[^188]: Petition at 35.

[^189]: TIA Reply Comments at 12.

[^190]: TIA Reply Comments at Brooks Affidavit at 11.

[^191]: 47 U.S.C. § 1006(b).

[^192]: *United States Telecom. Association v. FCC*, 227 F.3d 450 (D.C.
    Cir. 2000. The decision is available at
    <http://www.fcc.gov/ogc/documents/opinions/2000/99-1442.html> or at
    <http://www.fcc.gov/ogc/documents/opinions/2000/99-1442.doc> .

[^193]: The standards and specifications described in Appendix D are:
    TIA standards J-STD-025, J-STD-025-A, and J-STD-025-B; ATIS
    standards T1.724 and T1.678; and CableLabs® PacketCable™
    specifications PKT-SP-ESP-I01-991229, PKT-SP-ESP-I01-030815, and
    PKT-SP-ESP-I03-040113.

[^194]: 47 U.S.C. § 1006(b).

[^195]: For example, the *Third R&O* required wireline and wireless
    providers to meet the requirements in J-STD-025 for providing
    circuit-switched content, circuit-switched call-identifying
    information, and packet content to LEAs; while directing the
    industry to report back to the Commission at a later date on
    appropriate requirements for providing packet call-identifying
    information to LEAs. In essence, J-STD-025 was declared to be a safe
    harbor for circuit-mode voice and packet content; and effectively a
    temporary safe harbor for all packet-mode.

[^196]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6932, ¶ 93.

[^197]: *See supra* ¶ 14.

[^198]: *Third R&O*, *supra* n.Error: Reference source not found at
    16844-45, ¶ 119.

[^199]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6926-27, ¶ 80.

[^200]: *Third R&O*, *supra* n.Error: Reference source not found at
    16844-16846, ¶¶ 119-123.

[^201]: Presentation to the FCC by Nortel Networks, March 25, 2004.

[^202]: *Id*. at slide 8.

[^203]: *Id*. at slide 11. "LI" means Lawful Intercept.

[^204]: TIA Reply Comments at Declaration of Terri L. Brooks at 14.

[^205]: SIA Comments at 2.

[^206]: Space Station System Licensee, Inc., Assignor and Iridium
    Constellation LLC, Assignee, for Consent to Assignment of License
    Pursuant to Section 310(d) of the Communications Act, *Memorandum
    Opinion, Order and Authorization*, 17 FCC Rcd 2271 at Appendix A, ¶
    2.1 (2002). *See also, e.g.,* International Authorizations Granted,
    IB Docket No. 04-4, *Public Notice*, DA 04-628 (rel. March 8, 2004)
    (granting the assignment or transfer of control of space and earth
    station licenses relating to the Globalstar mobile satellite service
    to New Operating Globalstar LLC, subject to conditions, including
    assumption of agreements previously made with LEAs); Motient
    Services Inc. and TMI Communications and Company, LP, Assignors and
    Mobile Satellite Ventures Subsidiary LLC, Assignee, *Order and
    Authorization*, 16 FCC Rcd 20469 (2001).

[^207]: Lockheed Martin Global Telecommunications, Comsat Corporation,
    and Comsat General Corporation, Assignor and Telenor Satellite
    Mobile Service, Inc. and Telenor Satellite Inc., Assignee,
    Applications for Assignment of Section 214 Authorizations, Private
    Land Mobile Radio Licenses, Experimental Licenses, and Earth Station
    Licenses and Petition for Declaratory Ruling Pursuant to Section
    310(b)(4) of the Communications Act, *Order and Authorization*, 17
    FCC Rcd 2147 at Appendix B, ¶ 2.2 (2001).

[^208]: *See* 47 U.S.C. § 1008(b)(2)(A).

[^209]: Petition at 38-39.

[^210]: *See supra* ¶ 17.

[^211]: The first telecommunications solutions developed by equipment
    manufacturers that complied with CALEA § 103's capability
    requirements were not offered to telecommunications carriers until
    May of 2000. Since that time, other manufacturers have released
    solutions and continue to do so. *CALEA Sixth Annual Report to
    Congress*, prepared by the FBI and the DoJ (January 9, 2001) at 5.

[^212]: *See* *Public Notice*, *supra* n.Error: Reference source not
    found. All section 107(c) petitions are deemed confidential and
    protected against public release.

[^213]: *See 9/28/01 Public Notice*, *supra* n.Error: Reference source
    not found.

[^214]: *See 11/19/03Public Notice*, *supra* n.Error: Reference source
    not found.

[^215]: Some carriers filed extension petitions after the announced due
    dates (11/19/01 & 06/30/02). As a result, their circuit-mode
    extensions did not necessarily expire on June 30, 2004.

[^216]: *Order on Remand*, *supra* n.Error: Reference source not found.

[^217]: Additionally, the Commission has received a few CALEA section
    109 petitions. Prior to June 30, 2004, these petitioners either
    withdrew or amended their CALEA section 109 petitions to include
    requests for relief under CALEA section 107(c)(2), and were treated
    as section 107(c) filers. Since June 30, 2004, the Commission has
    received a few new section 109(b) petitions, many of which have been
    framed so as to seek alternative relief under section 107(c).

[^218]: Initially a 45-day compliance period was used, which tolled upon
    issuance of a Commission order denying CALEA section 107(c)(2)
    relief. *See Public Notice*, *supra* n.Error: Reference source not
    found at 7486, ¶ 9. Subsequently the Commission granted automatic
    two-year extensions to telecommunications carriers that tolled upon
    the filing of a CALEA section 107(c)(2) petition, unless the
    Commission acted within that period and shortened the two-year
    compliance period*. See 9/28/01 Public Notice, supra* n.Error:
    Reference source not found, at 17103, ¶ 8.

[^219]: *9/28/01 Public Notice, supra* n.Error: Reference source not
    found, at 17104-05, ¶¶ 10-13. We note that petitioners were offered
    a choice of three filing options, including the option to state that
    the petitioner is participating in the FBI's Flexible Deployment
    Assistance Plan and has included a copy of its Flexible Deployment
    Assistance Plan template with its section 107(c) petition. The
    overwhelming majority of petitioning carriers stated they were
    enrolled in the FBI's Flexible Deployment Assistance Plan.

[^220]: *Id. See also FBI CALEA Implementation Section, Flexible
    Deployment Assistance Guide* (Fourth Edit. May, 2004),
    <http://askcalea.net/docs/flexguide4.pdf>

[^221]: The Commission originally received more than 900 section 107(c)
    petitions addressing circuit-based (punch list) functionalities. We
    subsequently received notification from filers withdrawing over 200
    of these petitions as those carriers became CALEA compliant for
    circuit-based functionalities. Because carriers are under no
    obligation to inform us when they become CALEA-compliant, we believe
    that more carriers became CALEA-compliant for the punch list before
    their provisional extensions expired on June 30, 2004. We also
    understood that the RBOCs intended to be fully CALEA-compliant for
    circuit-based functionalities by June 30, 2004. And in fact, no RBOC
    has filed for additional 107(c) relief from circuit-mode CALEA
    obligations since June 30. We note that, if all RBOCs are now punch
    list compliant, wireline carriers are able to provide circuit-based
    CALEA functionalities in connection with nearly 85% of all U.S.
    access lines, including coverage in most major metropolitan areas.

[^222]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6919, ¶ 64.

[^223]: *Second R&O*, *supra* n. Error: Reference source not found at
    7129, ¶ 40. We also determined that only overhead costs incremental
    to and resulting from CALEA compliance may be included in carrier
    cost showings relating to CALEA implementation.

[^224]: *See also* discussion at ¶ 97 *infra* (interpreting section
    107(c) as expressly limited to cases where the petitioning carrier
    proposes to install or deploy, or has installed or deployed,
    equipment, facility, or service \"prior to the effective date of
    section 103,\" *i.e*., prior to October 25, 1998).

[^225]: *See* 47 C.F.R. §§ 0.457-0.461.

[^226]: It is simply not true that no packet-based standards have been
    developed by standards committees. Since 1997, J-STD-025 has
    provided a standard for intercepting and delivering packet *content*
    to law enforcement; this was unchanged in J-STD-025-A. The *Third
    R&O* required that the industry comply with the packet content
    standard by September 30, 2001, later extended to November 19, 2001.
    J-STD-025-B-2003 (December 2003) is a T1/TIA Joint Standard.
    T1.678-2004 (January 2004) is an ANSI standard. T1.PP.724-2004
    (January 2004) is a pre-published American National Standard. It has
    been approved by Committee T1 and ANSI, but has not completed its
    editing and publication cycles. Some petitioners claim that existing
    standards do not apply to their packet services**,** including
    Asynchronous Transfer Mode, Frame Relay, Digital Subscriber Line and
    others. The J-Standard explicitly lists a number of packet formats
    to which the content standard applies; however, other common packet
    formats are not listed, including ATM, FR, and DSL. *See Third R&O,*
    *supra* n.Error: Reference source not found at 16819-20, ¶¶ 55-56.

[^227]: *See supra* ¶¶ 20-21.

[^228]: *Petition for Extension of the Compliance Date Under Section 107
    of the Communications Assistance for Law Enforcement Act by AT&T
    Wireless Services, Inc.* *et al.*, *Memorandum Opinion and Order*,
    13 FCC Rcd 17990 (1998) at 17995-96, ¶ 7 n.21.

[^229]: *Id. at* 18005, ¶ 25.

[^230]: *See Second R&O*, *supra* n. Error: Reference source not found
    at 7127, ¶ 37.

[^231]: *Id.* at 7129-30, ¶ 42.

[^232]: *See* 47 U.S.C. § 1006(c)(1).

[^233]: Some carriers still offer so-called legacy packet services like
    packet ISDN and X.25. These might continue to quality for section
    107(c) extensions.

[^234]: *See* 47 USC §§ 1008(b)(1)(A) through (K).

[^235]: 47 U.S.C. § 1008(b)(1)(K).

[^236]: *See, e.g.,* 47 U.S.C. § 1007(a). Pursuant to this section's
    explicit terms, the court must decide whether CALEA compliance is
    reasonably achievable with reference to available technology and
    that "alternative technologies or capabilities or the facilities of
    another carrier are not reasonably available to law enforcement ..."
    47 U.S.C. § 1007(a)(1) and (2). In other words, defendants have the
    opportunity to demonstrate that CALEA compliance is not "reasonably
    achievable," and, even if they fail in that demonstration, a court
    must also consider whether CALEA "technologies, capabilities, or
    facilities" are available from another carrier before issuing an
    enforcement order.

[^237]: *See, e.g.,* Comments of CCCC at 3-4; Arkansas, Illinois, Iowa,
    and Oklahoma Rural Telephone Companies ("Rural ILECS") Reply
    Comments at 5.

[^238]: The section 107(c)/109(b) regime also does not seem to
    anticipate the likely *temporary* nature of "safe harbors" for
    packet services, in the same manner raised in ¶ 81 of this *Notice*,
    *supra*. For example, the current packet content standard might only
    be considered a "safe harbor" until service-specific packet
    standards for call-identifying information are specified. This has
    led to a number of practical problems. LEAs may be reluctant to
    agree that any standard functions as a "safe harbor" because they do
    not want to foreclose movement to standards that provide additional
    capabilities. Carriers, on the other hand, may be reluctant to
    deploy equipment incorporating capabilities specified by existing
    standards because they are unsure whether to do so would satisfy
    CALEA compliance requirements.

[^239]: *9/28/01 Public Notice, supra* n.Error: Reference source not
    found.

[^240]: *See FBI CALEA Implementation Section, Flexible Deployment
    Assistance Guide* (Third Edit. May, 2002), at 5-6.

[^241]: 47 U.S.C. § 1008(b)(1).

[^242]: Notwithstanding our tentative conclusions about the scope and
    requirements of section 109(b), we note concerns expressed by rural
    carrier representatives that it is unreasonable to expect small
    companies to independently develop CALEA solutions with
    manufacturers and other CALEA service providers because of allegedly
    prohibitive costs. *See* Comments of CCCC at 3-4, Reply Comments of
    NASUCA at 6-7, and Reply Comments of Rural ILECS at 2-6. We seek
    more detailed information about these alleged costs and their
    particular effects on small and rural carriers. Commenters should
    specifically include an assessment of costs associated with
    developing CALEA solutions directly with manufacturers, plus an
    assessment of the (putatively lower) costs associated with
    developing CALEA solutions provided by third-party vendors.

[^243]: *Second R&O*, *supra* n. Error: Reference source not found at
    7129, ¶ 40. We also determined that only overhead costs incremental
    to and resulting from CALEA compliance may be included in carrier
    cost showings relating to CALEA implementation.

[^244]: *See* 47 C.F.R. §§ 0.457-0.461.

[^245]: *See Petition* at 34-53.

[^246]: 47 U.S.C. § 251(e)(3).

[^247]: *See, e.g.,* AT&T Comments at 9, 19-21; BellSouth Comments at
    13-14; NTCA Comments at 2-3; SBC Comments at 13; Sprint Comments at
    14; USTA Comments at 9-11; IPI Reply Comments at 4-5; TIA Reply
    Comments at 18-19; and USTA Reply Comments at 4-6.

[^248]: See, *e.g.*, AT&T Comments at 17-18; BellSouth Comments at
    22-26; CCCC Comments at 3-4; TIA Comments at 10; SBC Comments at 2,
    13-14; Sprint Comments at 18-19; USTA Comments at 1, 5, and 10; TIA
    Reply Comments at 8; and NASUCA Reply Comments at 7.

[^249]: Law Enforcement Reply Comments at 41; *but see* USTA Comments at
    9 and IPI Reply Comments at 4.

[^250]: Regarding the difficulties of managing the proposed benchmark
    regime, we note the suggestion of FBI, *et al*., that "the
    Commission may need to establish separate phase-in schedules for
    separate packet-mode services in order to achieve CALEA packet-mode
    compliance." *See* Petition at 40.

[^251]: *Id.* at 58-59.

[^252]: 47 U.S.C. § 1006(c).

[^253]: 47 U.S.C. §§ 229(a), (d). Section 229(a) of the Communications
    Act states that the Commission "shall prescribe such rules as are
    necessary to implement the requirements of \[CALEA\]." 47 U.S.C. §
    229(a). Section 229(d), entitled "Penalties," provides that a
    violation "of a rule prescribed by the Commission pursuant to
    subsection (a), shall be considered to be a violation by the carrier
    of a rule prescribed by the Commission pursuant to \[the
    Communications\] Act." 47 U.S.C. § 229(d).

[^254]: Petition at 59.

[^255]: *Id.*

[^256]: Law Enforcement Reply Comments at 45.

[^257]: 47 U.S.C. § 1007. Section 108 permits a court to issue an order
    enforcing CALEA under section 2522 of title 18, U.S.C., only if two
    enumerated conditions exist: (1) alternative technologies or
    facilities of another carrier are not reasonably available to law
    enforcement; and (2) compliance with CALEA is reasonably achievable
    through the application of available technology. 47 U.S.C. §1007(a).
    Other limitations on enforcement orders are set forth under
    subsection (c). 47 U.S.C. §1007(c).

[^258]: Petition at 59-60, n.91.

[^259]: Law Enforcement Reply Comments at 45.

[^260]: Petition at 60.

[^261]: *See* NYSAG Comments at 18-19.

[^262]: *See, e.g.,* CDT Comments at 29; CTIA Comments at 17-18; Global
    Crossing Comments at 12-15; ISPCC Comments at 3, 34-38; TIA Comments
    at 12.

[^263]: *Id.*

[^264]: Global Crossing Comments at 13.

[^265]: 47 U.S.C. § 1007; 18 U.S.C. § 2522.

[^266]: *See* CDT Comments at 29-30; ISPCC Comments at 34.

[^267]: *See* CDT Comments at 30; Global Crossing Comments at 12.

[^268]: 47 U.S.C. § 229(a).

[^269]: *See* ISPCC Comments at 36-37.

[^270]: *See* ITIC Comments at 17.

[^271]: *Id*. at 18.

[^272]: 47 U.S.C. § 1007.

[^273]: 47 U.S.C. § 229(a) ("The Commission shall prescribe such rules
    as are necessary to implement the requirements of \[CALEA\]").

[^274]: 47 U.S.C. § 229 (b).

[^275]: 47 U.S.C. § 229(d).

[^276]: *Id*. Section 229(d) provides:

    > For purposes of this Act, a violation by an officer or employee of
    > any policy or procedure adopted by a common carrier pursuant to
    > subsection (b), or of a rule prescribed by the Commission pursuant
    > to subsection (a), shall be considered to be a violation by the
    > carrier of a rule prescribed by the Commission pursuant to this
    > Act.
    >
    > *Id.*

[^277]: 18 U.S.C. § 2522(a) (where a court issuing a surveillance order
    finds that a telecommunications carrier, manufacturer, or support
    services provider has failed to comply with CALEA, the court may
    direct such entity to comply); 18 U.S.C. § 2522(b) (the Attorney
    General may, in a civil action in the United States district court,
    obtain an order in accordance with section 108 of CALEA, directing
    that a telecommunications carrier, manufacturer, or support services
    provider comply with CALEA); 18 U.S.C. § 2522(c) (authorizing a
    court to impose a civil penalty of up to \$10,000 per day against a
    telecommunications carrier, manufacturer, or support services
    provider for each day in violation after the issuance of a court
    order requiring compliance).

[^278]: 47 U.S.C. § 1002.

[^279]: *See, e.g.,* 47 C.F.R. §§ 22.1100-22.1103; 24.900-24.903;
    64.2200-64.2203.

[^280]: 47 U.S.C. § 1006(b) (authorizing the Commission to adopt
    technical requirements or standards that meet the assistance
    capability requirements of section 103 where industry fails to adopt
    such requirements or standards or where a Government agency or any
    other person petitions the Commission claiming that such
    requirements or standards are deficient).

[^281]: The absence of technical requirements or standards for
    implementing the assistance capability requirements of section 103
    does not relieve a carrier, manufacturer, or support services
    provider of its CALEA obligations. 47 U.S.C. § 107(a)(3).

[^282]: *See, e.g.,* 47 U.S.C. §§ 312(b), 503(b).

[^283]: *See* 47 U.S.C. § 1009 (appropriating \$500 million to carry out
    CALEA for fiscal years 1995-1998); 47 U.S.C. § 1021 (establishment
    of Department of Justice Telecommunications Carrier Compliance
    Fund).

[^284]: *See* 47 U.S.C. § 1008(a) ("The Attorney General may, subject to
    the availability of appropriations, agree to pay telecommunications
    carries for all reasonable costs directly associated with the
    modifications performed by carriers in connection with equipment,
    facilities, and services installed or deployed on or before January
    1, 1995").

[^285]: Petition at 63.

[^286]: *Id*.

[^287]: *Id*. at 68.

[^288]: USTA Comments at 14. *See also* BellSouth Comments at 28;
    Verizon Comments at 21-22; Level 3 Reply Comments at 9.

[^289]: BellSouth Comments at 28.

[^290]: *See, e.g.,* SBC Comments at 14-15; Verizon Comments at 21.

[^291]: *See, e.g.,* RIITA Comments at 2 ("for rural customers, the
    costs would not be minimal and any requirement should only be made
    with a funding mechanism in place first"); CCCC Comments at 5
    ("Noticeably absent from petitioners' discussion is any recognition
    that for some rural carriers, CALEA software upgrades are quite
    expensive"); NTCA Comments at 5 (although an end user charge may be
    appropriate for large carriers, it may be more appropriate for rural
    carriers to recover costs in the interstate jurisdiction).

[^292]: Hotel Internet Technology Comments at 1.

[^293]: *See* discussion, *supra,* at ¶ 92, where we state our belief
    that the FBI's Flexible Deployment Program has facilitated
    circuit-mode CALEA compliance. This is because participating
    carriers are able to negotiate CALEA compliance commitments with the
    FBI in connection with their ordinary capital upgrade schedules.
    Notwithstanding the availability of the Flexible Deployment Program,
    we note that small and rural carriers in particular may require
    further extensions of circuit mode-related CALEA compliance dates
    for "cost-related or other reasons."

[^294]: 47 U.S.C. § 1001(8)(B)(ii).

[^295]: Petition at 64. Various law enforcement groups also have filed
    comments supporting the view that CALEA places the financial burden
    of post-January 1, 1995 equipment, services and facilities on
    carriers. *See, e.g.,* ILSP Comments at 1; LA Clear Comments at 1-2;
    MSP Comments at 2. We note that Congress enacted a different cost
    recovery scheme for equipment, facilities, and services installed or
    deployed on or before January 1, 1995. For such pre-January 1, 1995
    CALEA compliance costs, the Attorney General may, subject to the
    availability of appropriations, agree to pay telecommunications
    carriers for all reasonable costs directly associated with the
    modifications performed by carriers to establish the capabilities
    necessary to comply with CALEA section 103. 47 U.S.C. § 1008(a).

[^296]: Petition at 64. Under CALEA section 109(b), the Commission,
    after receiving a petition from a telecommunications carrier or any
    other interested person, has one year to determine whether
    compliance with the assistance capability requirements of CALEA
    section 103 is reasonably achievable. In making its determination,
    the Commission is required to evaluate a list of factors, including
    whether compliance would impose significant difficulty or expense on
    the carrier or on the users of the carrier\'s systems. If the
    Commission determines that CALEA compliance is not reasonably
    achievable, the Attorney General may agree, subject to the
    availability of appropriations, to pay that carrier for the
    additional reasonable costs of making CALEA compliance reasonably
    achievable. 47 U.S.C. § 1008(b).

[^297]: Petition at 64-67.

[^298]: 47 U.S.C. § 229(a).

[^299]: 47 U.S.C. § 229(e)(1). Section 229(e)(2) further states that the
    Commission may, consistent with maintaining just and reasonable
    charges, practices, classifications, and regulations in connection
    with the provision of interstate or foreign communication by wire or
    radio by a common carrier, allow carriers to adjust such charges,
    practices, classifications, and regulations. 47 U.S.C. §229(e)(2).

[^300]: Section 109(e)(2)(A) of CALEA, 47 U.S.C. § 1008(e)(2)(A).

[^301]: CALEA section 104 requires that telecommunications carriers
    comply with "capacity" requirements established by the Attorney
    General. 47 U.S.C. § 1003(a), (b). "Capacity" refers to the ability
    of carriers' equipment, facilities, and services to accommodate
    communications interceptions, pen registers, and trap and trace
    devices simultaneously. 47 U.S.C. § 1003(b). The D.C. Circuit
    addressed reimbursement of capacity related costs in *USTA v. FBI*,
    276 F.3d 620 (D.C. Cir. 2002).

[^302]: *Compare* 47 U.S.C. § 1008(a), (d) *with* § 1008(b).

[^303]: CALEA section 109(a), (d), 47 U.S.C. § 1008(a), (d).

[^304]: Section 109(d) of CALEA, 47 U.S.C. § 1008(d). *See also,* CALEA
    section 108(c)(3), 47 U.S.C. § 1007(c)(3) (no court may issue a
    CALEA enforcement order requiring a carrier to make modifications to
    pre-1995 equipment or facilities unless the federal government has
    agreed to pay for any such modifications).

[^305]: Section 109(b)(1) of CALEA, 47 U.S.C. § 1008(b)(1).

[^306]: ^?^*Second R&O*, *supra* n.Error: Reference source not found at
    7128, ¶ 39.

[^307]: ^?^*See, e.g.,* Global Crossing Comments at 15 (statute already
    allows carriers to recover costs from customers; new rules are
    unnecessary).

[^308]: The SLC is a flat-rated charge imposed by LECs on end users to
    recover the interstate-allocated portion of local loop costs. The
    SLC is also referred to as the end user common line charge. *See* 47
    C.F.R. § 69.152.

[^309]: Section 332(c)(3)(A) provides in pertinent part that ". . . no
    State or local government shall have nay authority to regulate . . .
    the rates charged by any commercial mobile radio service or any
    private mobile radio service, except that this paragraph shall not
    prohibit a State from regulating the other terms and conditions of
    commercial mobile services." 47 U.S.C. § 332(c)(3)(A).

[^310]: *See* GN Docket No. 93-252 -- *CMRS Second Report and Order*,
    *supra* n.Error: Reference source not found at 1417-18; Erratum, 9
    FCC Rcd 2156 (1994); *recon. denied.* 15 FCC Rcd 5231 (2000). *See
    also*, *e.g.*, *Petition of Arizona Corporation To Extend State
    Authority Over Rate and Entry Regulation of All Commercial Mobile
    Radio Services*, PR Docket No. 94-104, *Report and Order on
    Reconsideration*, 10 FCC Rcd 7824 (1995) at 7826, ¶ 9 (*Arizona
    Decision*).

[^311]: ^?^*See generally* 47 U.S.C. § 160(a)-(b).

[^312]: *See* 47 U.S.C. § 332(c)(3)(A). *See* *Arizona Decision*, 10 FCC
    Rcd at 1742-43, ¶ 16.

[^313]: *See e.g.*, *Petition of Pittencrief Communications, Inc. for
    Declaratory Ruling Regarding Preemption of the Texas Public Utility
    Regulatory Act of 1995*, 13 FCC Rcd 1735, 1736 (1997), *affirming*
    *Federal-State Joint Board on Universal Service*, CC Docket No.
    96-45, Report and Order, 12 FCC Rcd 8776, 9181-82, ¶ 791 (1997)
    (finding that section 332(c)(3) does not preclude states from
    requiring CMRS providers to contribute to state universal service
    support mechanisms).

[^314]: *See* OCCSSA, *supra* n.Error: Reference source not found, §
    802, 18 U.S.C. § 2518(4).

[^315]: *Order on Remand*, *supra* n.Error: Reference source not found
    at 6917, ¶ 60 (citing 47 U.S.C. § 229(e) and collateral state
    regulations).

[^316]: Petition at 69. Law Enforcement contends that an increasing
    number of LEAs have expressed concern over "the significant
    administrative costs" in carriers' bills for intercept provisioning,
    and that Congress has not authorized carriers to include
    CALEA-related capital costs in their intercept provisioning costs.
    Petition at 68.

[^317]: *Id*. at 69. *See also* Administrative Procedure Act, 5 U.S.C.
    §§ 551 *et seq.*

[^318]: Petition at 68.

[^319]: ^?^*See* 18 U.S.C. § 2518(4). *See also* Covad Comments at
    19-20.

[^320]: *See In the Matter of the Revision of the Commission\'s Rules to
    Ensure Compatibility With Enhanced 911 Emergency Calling Systems,
    E911 Compliance Deadlines for Non-Nationwide Tier III CMRS
    Carriers*, CC Docket No. 94-102, *Order to Stay*, 18 FCC Rcd 20987
    (2003) at 20993, ¶ 17; *In the Matter of the Revision of the
    Commission\'s Rules to Ensure Compatibility With Enhanced 911
    Emergency Calling Systems, Phase II Compliance Deadlines for
    Non-Nationwide Tier III CMRS Carriers*, CC Docket No. 94-102, *Order
    to Stay*, 17 FCC Rcd 14841 (2002) at 14846-47, ¶¶16-20 (noting
    factors underlying why wireless carriers with relatively small
    customer bases are at a disadvantage compared with large nationwide
    carriers); *see also*, *In the Matter Numbering Resource
    Optimization, Implementation of the Local Competition Provisions of
    the Telecommunications Act of 1996, Telephone Number Portability*,
    *Fourth Report and Order in CC Docket No. 99-200 and CC Docket No.
    95-116, and Fourth Further Notice of Proposed Rulemaking in CC
    Docket No. 99-200*, 18 FCC Rcd 12472 (2003) at 12478-79, ¶¶ 16-18
    (providing limited exemption for rural and small carriers from
    number pooling requirements).

[^321]: Under section 410(c) of the Communications Act, "\[t\]he
    Commission shall refer any proceeding regarding the jurisdictional
    separation of common carrier property and expenses between
    interstate and intrastate operations, which it institutes pursuant
    to a notice of proposed rulemaking and . . . may refer any other
    matter, relating to common carrier communications of joint
    Federal-State concern, to a Federal-State Joint Board." 47 U.S.C. §
    410(c). The Federal-State Joint Board is composed of three members
    of this Commission, and four state commissioners. *Id.* After such a
    referral, the Federal-State Joint Board is to issue a recommended
    decision to the Commission. *Id.*

[^322]: 47 U.S.C. § 229(e)(3). Part 36 jurisdictional separations rules
    apply only to incumbent LECs as defined in the Communications Act.

[^323]: ^?^*Jurisdictional Separations Reform and Referral to the
    Federal-State Joint Board*, CC Docket No. 80-286, *Notice of
    Proposed Rulemaking*, 12 FCC Rcd 22120 (1997) at 22168-69, ¶¶ 108-10
    (*Separations NPRM*). The Commission sought comment on how to
    separate the costs a carrier may incur and the revenues a carrier
    may receive in establishing the capabilities and capacity necessary
    to comply with CALEA; whether the costs incurred should be allocated
    to a new single category identified as CALEA-related expenses or to
    previously-existing separations categories; and whether revenues
    could be allocated to the respective jurisdictions based on
    relative-use factors based on the relative surveillance requirements
    of federal, state, and local law enforcement agencies. *Separations
    NPRM* at 22169, ¶ 110. The Federal-State Separations Joint Board was
    established in 1980. *Amendment of Part 67 of the Commission's Rules
    and Establishment of a Joint Board*, CC Docket No. 80-286, *Notice
    of Proposed Rulemaking and Order Establishing a Joint Board*, 78 FCC
    2d 837 (1980).

[^324]: *Jurisdictional Separations Reform and Referral to the
    Federal-State Joint Board,* CC Docket No. 80-286, Recommended
    Decision, 15 FCC Rcd 13160 (Fed-State Jt. Bd. on Jurisdictional
    Separations 2000); *Jurisdictional Separations and Referral to the
    Federal-State Joint Board*, CC Docket No. 80-286, Report and Order,
    16 FCC Rcd 11382 (2001) (*Separations Freeze Order*).

[^325]: 47 C.F.R. § 36.3 (codifying separations freeze requirements).

[^326]: *Separations NPRM*, *supra* n.Error: Reference source not found
    at 22169, ¶ 110.

[^327]: *See supra* ¶ 8.

[^328]: The Commission adopted system security requirements for
    telecommunications carriers in 1999. *See* *supra* ¶ 22, n. Error:
    Reference source not found. *See also* 47 C.F.R. §§ 64.2100-64.2106.

[^329]: Petition at 48.

[^330]: *See, e.g.,* Verizon Comments at 17-20; Sprint Comments at
    17-19; SBC Comments at 14.

[^331]: The FBI has authority to establish capacity requirements for
    carriers subject to CALEA, so we do not address here compliance
    dates for section 104 of CALEA. *See supra* ¶ 16.

[^332]: *See supra* ¶ 91. We note that, as discussed above in ¶¶ 96-103,
    newly-identified entities may not be able to request compliance
    extensions under § 107(c) of CALEA.

[^333]: *See* Petition at 32-33 (citing *Second R&O*, *supra* n.Error:
    Reference source not found at 7117, ¶ 21).

[^334]: *See*, *e.g.*, Comments of MSP, Baltimore County Police, LA
    Clear, NYSAG.

[^335]: *See* Letter from J. Scott III, Vice President and General
    Counsel, Regulatory Law, Verizon Wireless to M. Dortch, Secretary,
    Federal Communications Commission (April 14, 2004) (responding to
    comments and hereinafter referred to as Reply Comments of Verizon
    Wireless).

[^336]: *See* Reply Comments of Nextel, at 4.

[^337]: Comments of Sprint at 5-6 (citing *Second R&O*, *supra* n.Error:
    Reference source not found at 7117, ¶¶ 21-22).

[^338]: *See* *id*. at 5-6.

[^339]: *See* Andrew Seybold, *Putting PTT To The Test*, Wireless Week,
    Feb. 15, 2004
    http://www.wirelessweek.com/article/CA381631?spacedesc=Departments&stt=001
    (visited July 14, 2004) (also noting that Sprint uses a CDMA data
    channel, while other carriers, such as Nextel and Alltel use the
    voice channel in their push-to-talk offerings). *See also*, Sue
    Marek, *PTT Solutions Proliferate*, Wireless Week, Nov. 15, 2003
    http://www.wirelessweek.com/article/CA336369?stt=001&text=marek
    (visited July 14, 2004) (observing that the deployment of the voice
    channel relies on a packet-switched solution).

[^340]: Comments of Sprint at 9 (citing *Second R&O*, *supra* n.Error:
    Reference source not found at 7117, ¶ 22).

[^341]: *See* 47 C.F.R. § 1.2.

[^342]: *See* *Second R&O*, *supra* n.Error: Reference source not found
    at 7116, ¶ 19.

[^343]: *Id*. at 7116-17, ¶¶ 20-22 (referring to definition of
    "commercial mobile service" as "any mobile service . . . that is
    provided for profit and makes interconnected services available (A)
    to the public or (B) to such classes of eligible users as to be
    effectively available to a substantial portion of the public . . .
    ."). *See* 47 U.S.C. § 332(d).

[^344]: *See* *Second R&O*, *supra* n.Error: Reference source not found
    at 7117, ¶ 21.

[^345]: *Id*.

[^346]: *Id*. at 7120, ¶ 27 n.69.

[^347]: *See* Reply Comments of Verizon Wireless at 2.

[^348]: *See*, *e.g.*, *supra,* ¶ 44 (seeking comment concerning classes
    of wireless services that may not meet the definition of a
    "commercial mobile service" under section 102(8)(B)(i) of CALEA).
    For instance, some wireless push-to-talk offerings being developed
    will rely on Wi-Fi, combined with VoIP, and unlike CMRS-based
    push-to-talk that provides the capability of interconnecting to the
    local exchange network, would not interconnect to the PSTN. *See*,
    *e.g.*, *IP-Enabled Services Notice*, *supra* n.Error: Reference
    source not found at 4875, ¶ 14.

[^349]: *See* 5 U.S.C. § 603. The RFA, *see* 5 U.S.C. §§ 601 - 612, has
    been amended by the Contract With America Advancement Act of 1996,
    Public Law 104-112, 110 Stat. 847 (1996)(CWAAA). Title II of the
    CWAAA is the Small Business Regulatory Enforcement Fairness Act of
    1966 (SBREFA).

[^350]: 5 U.S.C. § 603(a).

[^351]: *Id*.

[^352]: ^?^5 U.S.C. §§ 603(b)(3), 604(a)(3).

[^353]: ^?^*Id*. § 601(6).

[^354]: ^?^*Id*. § 601(3) (incorporating by reference the definition of
    "small business concern" in the Small Business Act, 15 U.S.C.
    § 632). Pursuant to 5 U.S.C. § 601(3), the statutory definition of a
    small business applies "unless an agency, after consultation with
    the Office of Advocacy of the Small Business Administration and
    after opportunity for public comment, establishes one or more
    definitions of such terms which are appropriate to the activities of
    the agency and publishes such definitions(s) in the Federal
    Register."

[^355]: ^?^15 U.S.C. § 632.

[^356]: ^?^*Id*. § 632.

[^357]: ^?^Letter from Jere W. Glover, Chief Counsel for Advocacy, SBA,
    to William E. Kennard, Chairman, FCC (May 27, 1999). The Small
    Business Act contains a definition of "small-business concern,"
    which the RFA incorporates into its own definition of "small
    business." *See* 15 U.S.C. § 632(a) (Small Business Act); 5 U.S.C. §
    601(3) (RFA). SBA regulations interpret "small business concern" to
    include the concept of dominance on a national basis. *See* 13
    C.F.R. § 121.102(b).

[^358]: ^?^13 C.F.R. § 121.201, NAICS code 517110 (changed from 513310
    in Oct. 2002).

[^359]: ^?^ FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    Page 5-5 (Aug. 2003) (hereinafter "Trends in Telephone Service").
    This source uses data that are current as of December 31, 2001.

[^360]: ^?^13 C.F.R. § 121.201, NAICS code 517110 (changed from 513310
    in Oct. 2002).

[^361]: ^?^"Trends in Telephone Service" at Table 5.3.

[^362]: ^?^13 CFR § 121.201, NAICS code 517110 (changed from 513310 in
    Oct. 2002).

[^363]: ^?^"Trends in Telephone Service" at Table 5.3.

[^364]: ^?^13 C.F.R. § 121.201, NAICS code 517110 (changed from 513310
    in Oct. 2002).

[^365]: ^?^"Trends in Telephone Service" at Table 5.3.

[^366]: ^?^13 C.F.R. § 121.201, NAICS code 517110 (changed from 513310
    in Oct. 2002).

[^367]: ^?^"Trends in Telephone Service" at Table 5.3.

[^368]: ^?^13 C.F.R. § 121.201, NAICS code 517310 (changed from 513330
    in Oct. 2002).

[^369]: ^?^"Trends in Telephone Service" at Table 5.3.

[^370]: ^?^13 C.F.R. § 121.201, NAICS code 513321 (changed to 517211 in
    October 2002).

[^371]: ^?^13 C.F.R. § 121.201, NAICS code 513322 (changed to 517212 in
    October 2002).

[^372]: ^?^U.S. Census Bureau, 1997 Economic Census, Subject Series:
    "Information," Table 5, Employment Size of Firms Subject to Federal
    Income Tax: 1997, NAICS code 513321 (issued October 2000).

[^373]: ^?^*Id.* The census data do not provide a more precise estimate
    of the number of firms that have employment of 1,500 or fewer
    employees; the largest category provided is "Firms with 1000
    employees or more."

[^374]: ^?^U.S. Census Bureau, 1997 Economic Census, Subject Series:
    "Information," Table 5, Employment Size of Firms Subject to Federal
    Income Tax: 1997, NAICS code 513322 (issued October 2000).

[^375]: ^?^*Id.* The census data do not provide a more precise estimate
    of the number of firms that have employment of 1,500 or fewer
    employees; the largest category provided is "Firms with 1000
    employees or more."

[^376]: ^?^13 C.F.R. § 121.201, NAICS code 513322 (changed to 517212 in
    October 2002).

[^377]: ^?^U.S. Census Bureau, 1997 Economic Census, Subject Series:
    "Information," Table 5, Employment Size of Firms Subject to Federal
    Income Tax: 1997, NAICS code 513322 (issued October 2000).

[^378]: ^?^*Id.* The census data do not provide a more precise estimate
    of the number of firms that have employment of 1,500 or fewer
    employees; the largest category provided is "Firms with 1000
    employees or more."

[^379]: ^?^FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    page 5-5 (August 2003). This source uses data that are current as of
    December 31, 2001.

[^380]: ^?^FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    page 5-5 (August 2003). This source uses data that are current as of
    December 31, 2001.

[^381]: ^?^13 C.F.R. § 121.201, NAICS code 513322 (changed to 517212 in
    October 2002).

[^382]: ^?^U.S. Census Bureau, 1997 Economic Census, Subject Series:
    "Information," Table 5, Employment Size of Firms Subject to Federal
    Income Tax: 1997, NAICS code 513321 (issued October 2000).

[^383]: ^?^*Id.* The census data do not provide a more precise estimate
    of the number of firms that have employment of 1,500 or fewer
    employees; the largest category provided is "Firms with 1000
    employees or more."

[^384]: ^?^Amendment of Part 90 of the Commission's Rules to Provide for
    the Use of the 220-222 MHz Band by the Private Land Mobile Radio
    Service, PR Docket No. 89-552, Third Report and Order and Fifth
    Notice of Proposed Rulemaking, 12 FCC Rcd 10943, 11068-70, 62 FR
    16004 (April 3, 1997), paras. 291-295.

[^385]: ^?^*See* Letter to Amy Zoslov, Chief, Auctions and Industry
    Analysis Division, Wireless Telecommunications Bureau, Federal
    Communications Commission, from A. Alvarez, Administrator, SBA (Dec.
    2, 1998).

[^386]: ^?^"Revision of Part 22 and Part 90 of the Commission's Rules to
    Facilitate Future Development of Paging Systems," Memorandum Opinion
    and Order on Reconsideration and Third Report and Order, 14 FCC Rcd
    10030, at paragraphs 98-107 (1999).

[^387]: ^?^Revision of Part 22 and Part 90 of the Commission's Rules to
    Facilitate Future Development of Paging Systems, Memorandum Opinion
    and Order on Reconsideration and Third Report and Order, 14 FCC Rcd
    10030, 10085 para. 98 (1999).

[^388]: ^?^FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    page 5-5 (August 2003). This source uses data that are current as of
    December 31, 2001.

[^389]: ^?^FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    page 5-5 (August 2003). This source uses data that are current as of
    December 31, 2001.

[^390]: ^?^*See* Letter to Amy Zoslov, Chief, Auctions and Industry
    Analysis Division, Wireless Telecommunications Bureau, Federal
    Communications Commission, from A. Alvarez, Administrator, Small
    Business Administration (December 2, 1998).

[^391]: ^?^13 C.F.R. § 121.201, NAICS code 513322 (changed to 517212 in
    October 2002).

[^392]: ^?^13 C.F.R. § 121.201, NAICS code 513322 (changed to 517212 in
    October 2002).

[^393]: ^?^FCC, Wireline Competition Bureau, Industry Analysis and
    Technology Division, "Trends in Telephone Service" at Table 5.3,
    page 5-5 (August 2003). This source uses data that are current as of
    December 31, 2001.

[^394]: ^?^*See* Amendment of Parts 20 and 24 of the Commission's Rules
    -- Broadband PCS Competitive Bidding and the Commercial Mobile Radio
    Service Spectrum Cap, WT Docket No. 96-59, Report and Order, 11 FCC
    Rcd 7824, 61 FR 33859 (July 1, 1996); *see also* 47 C.F.R. §
    24.720(b).

[^395]: ^?^*See* Amendment of Parts 20 and 24 of the Commission's Rules
    -- Broadband PCS Competitive Bidding and the Commercial Mobile Radio
    Service Spectrum Cap, WT Docket No. 96-59, Report and Order, 11 FCC
    Rcd 7824, 61 FR 33859 (July 1, 1996).

[^396]: ^?^*See. e.g.,* Implementation of Section 309(j) of the
    Communications Act -- Competitive Bidding, PP Docket No. 93-253,
    Fifth Report and Order, 9 FCC Rcd 5332, 59 FR 37566 (July 22, 1994).

[^397]: ^?^FCC News, Broadband PCS, D, E and F Block Auction Closes, No.
    71744 (released January 14, 1997). *See also* Amendment of the
    Commission's Rules Regarding Installment Payment Financing for
    Personal Communications Services (PCS) Licenses, WT Docket No.
    97-82, Second Report and Order, 12 FCC Rcd 16436, 62 FR 55348
    (October 24,1997).

[^398]: 13 CFR § 121.201, North American Industry Classification System
    (NAICS) code 513220 (changed to 517510 in October 2002).

[^399]: U.S. Census Bureau, 1997 Economic Census, Subject Series:
    Information, "Establishment and Firm Size (Including Legal Form of
    Organization)," Table 4, NAICS code 513220 (issued October 2000).

[^400]: 47 CFR § 76.901(e). The Commission developed this definition
    based on its determination that a small cable system operator is one
    with annual revenues of \$100 million or less. *Implementation of
    Sections of the 1992 Cable Act: Rate Regulation,* Sixth Report and
    Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393 (1995),
    60 FR 10534 (Feb. 27, 1995).

[^401]: Paul Kagan Associates, Inc., *Cable TV Investor*, February 29,
    1996 (based on figures for December 30, 1995).

[^402]: 47 U.S.C. § 543(m)(2).

[^403]: See FCC Announces New Subscriber Count for the Definition of
    Small Cable Operator, Public Notice DA 01-158 (Jan. 24, 2001).

[^404]: 47 CFR § 76.901(f).

[^405]: See FCC Announces New Subscriber Count for the Definition of
    Small Cable Operators, Public Notice, DA-01-0158 (rel. January 24,
    2001).

[^406]: The Commission does receive such information on a case-by-case
    basis if a cable operator appeals a local franchise authority's
    finding that the operator does not qualify as a small cable operator
    pursuant to § 76.901(f) of the Commission's rules. *See* 47 CFR §
    76.909(b).

[^407]: U.S. Census Bureau, "2002 NAICS Definitions: 518111 Internet
    Service Providers" (Feb. 2004) \<www.census.gov\>.

[^408]: 13 C.F.R. § 121.201, NAICS code 518111 (changed from previous
    code 514191, "On-Line Information Services," in Oct. 2002).

[^409]: U.S. Census Bureau, 1997 Economic Census, Subject Series:
    Information, \"Establishment and Firm Size (Including Legal Form of
    Organization),\" Table 4, NAICS code 514191 (issued Oct. 2000).

[^410]: *See Notice* at ¶¶ 1, 47, and 56.

[^411]: *Id*. at ¶¶ 2, 87, and 97.

[^412]: 5 U.S.C. § 603(c).

[^413]: We note that delivery of the subject's packet content by the
    service provider has been required under the *Order on Remand*.
    *See* n.32, *supra*.

[^414]: Section 3 of J-STD-025 describes packet-mode as a "communication
    where individual packets or virtual circuits of a communication
    within a physical circuit are switched or routed by the accessing
    telecommunication system. Each packet may take a different route
    through the intervening network(s)."

[^415]: ^?^J-STD-025 includes a parameter that would identify the
    location of a subject\'s "mobile terminal" whenever this information
    is reasonably available at the Intercept Access Point and its
    delivery to law enforcement is legally authorized. Location
    information would be available to the law enforcement agency
    irrespective of whether a call content channel or a call data
    channel is employed. *See* J-STD-025 at § 6.4.6 and §§ 5.4.1-5.4.8,
    Tables 1, 5, 6, and 8.

[^416]: *See supra* ¶ 14.

[^417]: The intercept access point is the point within a
    telecommunication system where communications or call-identifying
    information of an intercept subject's equipment, facilities and
    services are accessed.

[^418]: 47 U.S.C. §1006(a)(2) and 47 U.S.C. §1006(b).

[^419]: TIA Reply Comments at 7.

[^420]: cdma2000 is a registered trademark of TIA.

[^421]: 3G TS 33.108, 3rd Generation Partnership Project: *Technical
    Specification Group Services and System Aspects: 3G Security;
    Handover interface for Lawful Interception*.

[^422]: Presentation by Nortel Networks to the FCC, March 25, 2004.

[^423]: ATIS Comments at 4.

[^424]: ATIS/TIA joint press release, "ATIS and TIA Publish Lawfully
    Authorized Electronic Surveillance (J-STD-025-B) Standard," March
    19, 2004, available at
    <http://www.atis.org/PRESS/pressreleases2004/031904.htm>

[^425]: CableLabs® is a trademark of Cable Television Laboratories, Inc.

[^426]: PacketCable™ is a trademark of Cable Television Laboratories,
    Inc.

[^427]: Cable Television Laboratories, Inc. electronic filing of June
    10, 2004, RM-10865.

[^428]: *See 9/28/01 Public Notice*, *supra* n.Error: Reference source
    not found.

[^429]: *See* n.Error: Reference source not found, *supra*.

[^430]: 47 U.S.C. § 1002*. See also Lawfully Authorized Electronic
    Surveillance Joint Standard*, J-STD-025-B (TIA December, 2003).

[^431]: *Third R&O*, *supra* n.Error: Reference source not found at
    16801, ¶ 55.

[^432]: *Order*, *supra* n.29 at 6896, ¶ 1.