Before the

Federal Communications Commission

Washington, D.C. 20554

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| In the Matter of                 | * | CC Docket No. 96-115         |
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| Implementation of the            | ) | CC Docket No. 96-149         |
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| Telecommunications Act of 1996   | * |                              |
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| Telecommunications Carriers' Use | * |                              |
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CLARIFICATION ORDER AND SECOND FURTHER NOTICE

OF PROPOSED RULEMAKING

**Adopted:** August 28, 2001 **Released:** September 7, 2001

**Comment Date:** 30 days after publication in the Federal Register

**Reply Comment Date:** 45 days after publication in the Federal
Register

By the Commission: Commissioners Tristani and Copps issuing a statement.

# INTRODUCTION

1.  On August 18, 1999, the United States Court of Appeals for the Tenth
    Circuit issued an opinion[^1] vacating a portion of the Commission's
    1998 order addressing customer proprietary network information
    (CPNI)*.*[^2] In the *CPNI Order*, the Commission adopted rules
    implementing Section 222 of the Communications Act, which governs
    carrier use and disclosure of CPNI. CPNI includes where, when, and
    to whom a customer places a call, as well as the types of service
    offerings to which the customer subscribes and the extent to which
    the service is used.[^3] In this Order, we clarify the status of our
    CPNI rules after the Tenth Circuit's opinion and explain how parties
    may obtain customer consent for use of their CPNI. In this Second
    Further Notice of Proposed Rulemaking, we seek comment on what
    methods of customer consent would serve the governmental interests
    at issue and afford informed consent in accordance with the First
    Amendment. We also seek comment on the interplay between Section 222
    and Section 272 of the Act in response to a voluntary remand granted
    by the United States Circuit Court of Appeals for the District of
    Columbia. [^4]

# BACKGROUND

2.  On May 17, 1996, the Commission initiated a rulemaking, in response
    to various informal requests for guidance from the
    telecommunications industry, regarding the obligation of
    telecommunications carriers under Section 222 of the Act and related
    issues.[^5] The Commission subsequently released the *CPNI Order* on
    February 26, 1998, which addressed the scope and meaning of Section
    222, and promulgated regulations to implement that section. In the
    *CPNI Order*, the Commission determined that "\[w\]ith Section 222,
    Congress expressly directs a balance of 'both competitive and
    consumer privacy interests with respect to CPNI.'"[^6] It found this
    conclusion to be supported by the comprehensive statutory design,
    which expressly recognizes the duty of all telecommunications
    carriers to protect customer information, and embodies the principle
    that customers must be able to control information they view as
    sensitive and personal from unauthorized use, disclosure, and access
    by carriers. Where information is not sensitive, it found that
    Section 222 permits the free flow of information beyond the
    customer-carrier relationship, because in this situation, the
    customer's interest rests more in choosing service with respect to a
    variety of competitors, thus necessitating competitive access to the
    information.[^7]

3.  In the *CPNI Order*, the Commission stated that Section 222(c)(1) of
    the Act allows a carrier to use, without the customer's prior
    approval, the customer's CPNI derived from the complete service that
    the customer subscribes to from that carrier and its affiliates, for
    marketing purposes within the existing service relationship.[^8]
    This is known as the "total service approach." The Commission also
    concluded that carriers must notify the customer of the customer's
    rights under Section 222 and then obtain express written, oral or
    electronic customer approval \-- a "notice and opt-in" approach \--
    before a carrier may use CPNI to market services outside the
    customer's existing service relationship with that carrier.[^9] U S
    West appealed this order to the Tenth Circuit. On August 16, 1999,
    the Commission adopted the *CPNI Reconsideration Order*[^10] in
    response to a number of petitions for reconsideration, forbearance,
    and clarification of the *CPNI Order*. The *CPNI Reconsideration
    Order*, among other things, further clarified the total service
    approach.[^11] It also retained the opt-in approach.[^12]

4.  After the Commission adopted the *CPNI Reconsideration Order*, the
    Tenth Circuit issued its decision in *U S WEST v. FCC*, vacating a
    portion of the *CPNI Order* "and the regulations adopted
    therein."[^13] In *U S WEST v. FCC*, U S WEST contended that the
    opt-in approach for customer approval in the *CPNI Order* violated
    the First and Fifth Amendments of the Constitution.[^14] The court
    declined to review the Commission's opt-in approach under the
    traditional administrative law standards of *Chevron,*[^15] in light
    of what it perceived as the "serious constitutional questions"
    raised by the approach, and determined that it must be reviewed
    under the constitutional standards applicable to regulations of
    commercial speech in *Central Hudson Gas & Elec. Corp. v. Public
    Service Commission*.[^16]

5.  The *Central Hudson* analysis tests "the validity of regulations
    under the constitutional standards applicable to regulation of
    commercial speech."[^17] Applying these tests, the Tenth Circuit
    first questioned whether the government had demonstrated that the
    interests it put forward in regulating CPNI \-- protecting customer
    privacy and fostering competition \-- are substantial. The court
    agreed that the government had asserted a substantial interest in
    protecting customers' privacy, but declined to find that promoting
    competition was a significant consideration in Congress' enactment
    of Section 222 because the section contains no explicit mention of
    competition. The court did acknowledge, however, that Congress "may
    not have completely ignored competition in drafting 222" and so
    allowed that the Act's objective of competition was in "concert with
    the government's interest in protecting the consumer's privacy."
    [^18]

6.  The court nonetheless concluded that the government did not
    demonstrate that the CPNI regulations requiring opt-in customer
    approval "directly and materially advanc\[ed\] its interests in
    protecting privacy and promoting competition."[^19] The court
    concluded that the Commission's determination that an opt-in
    requirement would best protect a consumer's privacy interests was
    not narrowly tailored because the Commission had failed to
    adequately consider an opt-out option. The court stated that an
    opt-out option should have been more fully investigated as it is
    inherently less restrictive of speech. Further, the court ruled the
    Commission did not adequately show that an opt-out strategy would
    not offer sufficient protection of consumer privacy.[^20] In
    vacating portions of the *CPNI Order*, the court did not require the
    Commission to find specifically that the opt-out option was the
    correct approach. Instead, it found fault with the Commission's
    "inadequate consideration of the approval mechanism alternatives in
    light of the First Amendment."[^21]

# Effect of the U S WEST Decision on the CPNI RULES

## Status of Rules Not Concerning Opt-in Customer Approval

7.  The court's opinion in *U S WEST v. FCC* analyzed only the
    constitutionality of the Commission's interpretation of the customer
    approval requirement of Section 222(c)(1) of the Act by enacting the
    opt-in regime discussed above. As we have found previously, the
    court's vacatur order related only to the discrete portions of the
    *CPNI Order* and rules requiring opt-in customer approval.[^22] Had
    the court intended to take the unusual step of vacating portions of
    the order and rules not before it, we believe it would have said so
    explicitly. Accordingly, we conclude that the court sought to
    eliminate only the specific section of our rules that was before it,
    and that its vacatur order applied only to Section 64.2007(c), the
    only provision inextricably tied to the opt-in mechanism.[^23] The
    remainder of the Commission's CPNI rules remain in effect. In
    reaching this determination, we note that Section 64.2007 contains
    customer notification requirements, which are needed regardless of
    whether an opt-in or opt-out regime is in effect. These
    requirements, set forth in paragraph (f) of this rule, ensure that a
    carrier provides a customer with "sufficient information to enable
    the customer to make an informed decision as to whether to permit a
    carrier to use, disclose or permit access to, the customer's
    CPNI."[^24] Among other things, this rule requires the carrier to
    advise the customer about the customer's right to limit access to
    CPNI and the precise steps the customer would need to take to limit
    such access. Because these notification requirements are general in
    nature, and necessary without regard to the particular method of
    customer approval ultimately adopted, we consider it appropriate
    that they remain in effect notwithstanding the court's vacatur of
    the specific method of customer approval previously adopted.

8.  In the Further Notice of Proposed Rulemaking discussed below, we
    seek comment on the responsibilities of carriers in obtaining
    consent from customers for the use of CPNI and, specifically, on
    whether we should adopt opt-in or opt-out consent under Section
    222(c)(1). Pending the resolution by the Commission of the
    particular method of consent, we offer in this Order guidance to
    parties on how to obtain consent during this interim period.
    Specifically, pending resolution of this docket, carriers may
    proceed to obtain consent consistent with the notification
    requirements in Section 64.2007(f), using an opt-out mechanism or,
    should they choose to do so, an opt-in mechanism. However, we
    underscore that consistent with the court's vacatur, we no longer
    mandate an opt-in mechanism.

9.  If carriers should choose to obtain customer approval by means of an
    opt-out approach, such carriers will need to provide customers with
    notification consistent with Section 64.2007(f). Such notification,
    either written or oral, advises customers that without any further
    authorization, the carrier may use the customer's CPNI not only to
    market to the customer services to which the customer currently
    subscribes, along with customer premises equipment and information
    services, and to share the customer's CPNI with any of its
    telecommunications carrier affiliates that have an existing
    relationship with the customer, but also to market services to which
    the customer does not already subscribe.[^25] An opt-out
    notification must also provide a reasonable and convenient means of
    opting out, such as a detachable reply card, toll-free telephone
    number or electronic mail address.

10. To the extent that a carrier has already provided any customer with
    an opt-out request to market services to which the customer does not
    already subscribe, and such opt-out mechanism satisfies the
    requirements set forth in paragraphs 9 and 11, the carrier need not
    provide any additional notification to such customer.[^26] Moreover,
    if a carrier has already provided a customer with notification
    premised upon an opt-in mechanism, the carrier, should it so choose,
    may continue to rely upon such notice. However, in that event, the
    carrier and its affiliates may not market services in reliance upon
    the notification unless the customer has chosen to opt-in,
    consistent with the notification. For that reason, we expect that
    carriers may choose to send out new notices describing an opt-out
    mechanism in light of the vacatur order.

11. Finally, we note that our current rules do not provide for any time
    period after which a customer's implicit approval of the use or
    sharing of CPNI may be reasonably assumed to have been given to the
    carrier. We will consider that question in the FNPRM below. In the
    interim, however, we expect that carriers shall not use the CPNI
    based on "implicit approval" (through opt-out) until customers have
    been afforded some reasonable period to respond to the notification.
    Pending resolution of the FNPRM, we will use a 30-day period from
    customer receipt of notice as a "safe harbor," but may permit some
    shorter period if supported by an adequate explanation from the
    carrier.

# FURTHER NOTICE OF PROPOSED RULEMAKING

12. In this Further Notice, we seek to obtain a more complete record on
    ways in which customers can consent to a carrier's use of their
    CPNI. Taking into account the Tenth Circuit's opinion, we seek
    comment on what methods of approval would serve the governmental
    interests at issue, and afford informed consent, while also
    satisfying the constitutional requirement that any restrictions on
    speech be narrowly tailored. Specifically, we seek comment on the
    interests and policies underlying Section 222 that are relevant to
    formulating an approval requirement, including an analysis of the
    privacy interests that are at issue, and on the extent to which we
    should take competitive concerns into account. To the extent that
    competition, in addition to privacy, is a legitimate government
    interest under Section 222, we seek comment on the likely difference
    in competitive harms under opt-in and opt-out approvals. We seek
    comment on whether it is possible for the Commission to implement a
    flexible opt-in approach that does not run afoul of the First
    Amendment, or whether opt-out approval is the only means of
    addressing the constitutional concerns expressed by the 10^th^
    Circuit.

13. At the outset, we also ask parties to comment on the scope of the
    Tenth Circuit's opinion. As we stated above, we conclude that the
    Tenth Circuit vacated only the specific portion of our CPNI rules
    relating to the opt-in mechanism. We seek comment on this
    interpretation, and on whether it is reasonable to interpret the
    opinion as vacating other CPNI rules that are not inextricably tied
    to opt-in. If we were to conclude that the court vacated additional
    requirements, which we do not believe that it did, we ask parties to
    comment on whether it would affect our overall findings regarding
    "approval of the customer" in Section 222(c)(1). Would we need to
    re-examine our interpretation of "approval" as it relates to the
    uses for which a carrier may use CPNI without customer approval,
    including to market customer premises equipment and information
    services, and to use CPNI to market to customers who have switched
    to another carrier?[^27] As the Commission concluded in the *CPNI
    Order*, we have authority to adopt rules to implement approval
    requirements in Section 222(c)(1) as well as for other obligations
    imposed on carriers by Section 222.[^28] Exercising this authority
    is consistent with what Congress envisioned to ensure a uniform
    national CPNI policy, and is necessary to reduce confusion and
    controversy for customers and carriers regarding carrier use of
    CPNI.[^29] We ask parties to comment on whether anything in the
    Tenth Circuit's opinion affects our exercise of this authority, or
    otherwise changes how we should implement and enforce the privacy
    requirements contained in Section 222.

## Form of Approval Under Section 222(c)(1) 

14. In the *CPNI Order*, the Commission addressed specifically the
    requirement that a carrier obtain "approval of the customer" for use
    of CPNI outside the telecommunications service from which it was
    derived.[^30] It concluded that the term "approval" should be
    interpreted "in a manner that will best further consumer privacy
    interests and competition, as well as the principle of customer
    control" underlying Section 222.[^31] In light of those statutory
    objectives, it further concluded that carriers must obtain express
    written, oral, or electronic approval by a customer to use a
    customer's CPNI beyond the existing service relationship. It
    concluded that an opt-in approach would best ensure that customers
    confer knowing approval of the use of their information.[^32] It
    further concluded that CPNI could be shared with other affiliates
    that have a relationship with the customer because such sharing
    would not implicate privacy concerns.[^33]

15. The Commission rejected an opt-out regime, under which a carrier
    could use CPNI beyond the existing service relationship as long as
    it has made a request to a customer for permission to use CPNI in
    that manner and the customer had not expressly objected to such use.
    It reasoned that an opt-out regime would not ensure informed consent
    because customers might not read carriers' disclosures and might not
    comprehend the extent of their rights under the Act or the steps
    they must take to protect those rights. Moreover, with respect to
    promoting competition, the Commission found that an opt-in
    requirement limits the advantage that incumbent carriers have over
    new competitive entrants.[^34]

16. Because the Tenth Circuit found that the opt-in requirements were
    not narrowly tailored to promote the government's asserted interests
    in protecting privacy and promoting competition,[^35] we initiate
    this proceeding to obtain a more complete record on consent
    mechanisms, and we urge commenters to focus upon the concerns
    articulated by the court. In addition, we ask parties to comment on
    whether there are any other laws or regulatory schemes governing
    matters similar to CPNI that the Commission might use as an analog.
    For example, both the financial services and healthcare industries
    have regulatory models in place for guarding consumers'
    privacy.[^36] Is the information that these models are designed to
    protect different or more sensitive than CPNI such that it deserves
    heightened protection, or are there similarities that we should take
    into account in developing a consent scheme that is responsive to
    the court's opinion? Parties should also comment on whether there
    are any other consent requirements that apply in a
    non-telecommunications context that we should consider?

17. We seek comment on the interests and policies underlying Section 222
    that are relevant to formulating an approval requirement to
    implement Section 222(c)(1). In the *CPNI Order*, the Commission
    articulated two governmental interests: protection of customer
    privacy and promotion of competition.[^37] The court indicated that
    "\[w\]hile, in the abstract, these may constitute legitimate and
    substantial interests, we have concerns about the proffered
    justifications *in the context of this case*."[^38] We ask the
    parties to comment upon the extent to which these interests bear
    upon our interpretation of the approval requirement at issue.
    Commenters should also discuss, with as much specificity as
    possible, how a carrier's use of CPNI could erode privacy. The Tenth
    Circuit recognized that "disclosure of CPNI information could prove
    embarrassing to some," but beyond that was uncertain about the
    government's privacy interest.[^39] We seek comment on that aspect
    of the court's analysis and ask what other privacy concerns may be
    implicated by access to CPNI. For example, the court noted that
    privacy interests may include protection against unwanted
    solicitations, but questioned whether such concerns were embraced by
    Section 222. We seek comment on this question. The court also said
    that it "would prefer to see a more empirical explanation and
    justification for the government's asserted interest \[in
    privacy\]."[^40] We seek comments responsive to the court's concern.

18. The court was not persuaded that competition was a legitimate or
    substantial state interest underlying Section 222.[^41] We seek
    comments that address those reservations, and on the extent to which
    competitive concerns should be taken into account in our
    interpretation of the approval requirements under Section 222(c)(1).
    We further seek comment about the potential competitive
    ramifications of construing Section 222 without regard to
    competitive issues, and how such a construction might affect the
    competitive goals of the 1996 Act. We seek comment on the likely
    difference in competitive effects under opt-in and opt-out
    approvals. We request empirical or other evidence to illustrate the
    competitive advantages, if any, that opt-out approval affords a
    carrier.[^42] We ask whether, and to what extent, any such
    competitive advantages may undermine the goals of Section 222 or,
    more generally, the goals of the 1996 Act. The court indicated that
    the competitive concerns we previously articulated were
    speculative.[^43] We seek comments responsive to the court's opinion
    and ask how these competitive questions should shape our
    interpretation and enforcement of the Section 222(c)(1) approval
    requirement.

19. We seek comment on any potential harms that may arise from adopting
    either an opt-out or opt-in approach. The court, for example, stated
    that the "government presents no evidence regarding how and to whom
    carriers would disclose CPNI."[^44] As a result, the court had
    difficulty evaluating the potential for harms from CPNI
    dissemination.[^45] We inquire to whom a carrier might make CPNI
    available, and seek comments about the extent to which such
    dissemination would affect customer privacy interests.

20. We ask parties to address the relative costs and convenience of CPNI
    use under both opt-in and opt-out approaches. Finally, we seek
    comment on the court's statement that opt-out is a "substantially
    less restrictive alternative."[^46] We seek comment more broadly on
    what methods of approval would serve the governmental interests at
    issue, and afford informed consent, while also satisfying the
    constitutional requirement that any restrictions on speech be
    narrowly tailored.

21. We seek comment on whether adoption of an opt-out mechanism is
    consistent with the rationale for the total service approach set
    forth in the *CPNI Order*.[^47] In other words, under the total
    service approach, the customer's implied approval is limited to the
    parameters of the customer's existing service, while the customer
    must grant the carrier affirmative approval in order for the carrier
    to use the customer's CPNI to market other services to the customer.
    If we adopt an opt-out approach such that a carrier need not obtain
    the customer's affirmative approval to market services not already
    subscribed to by the customer, is it necessary or appropriate for us
    to adopt an alternative to the total service approach? In
    particular, would there be an impact on the competitive goals of the
    Act if adoption of an opt-out mechanism increased the likelihood of
    customer approval for the use of CPNI to market services not already
    subscribed to by the customer? Alternatively, would adoption of an
    opt-out mechanism achieve the appropriate balance among the
    interests of privacy, competition, equity, and efficiency? Moreover,
    in the *CPNI Reconsideration Order*, the Commission determined that
    carriers may use CPNI derived from its provision of a
    telecommunications service to market CPE necessary to, or used in,
    the provision of that telecommunications service in accordance with
    Section 222(c)(1).[^48] In a separate proceeding, the Commission
    modified and clarified its bundling rules promulgated under
    *Computer II*[^49] to allow carriers to bundle CPE and enhanced
    services with telecommunications services.[^50] We seek comment on
    whether the issues raised in that proceeding should affect our
    interpretation of Section 222(c)(1) and the total service approach.

22. Finally, we note that in the Wireless Communications and Public
    Safety Act of 1999 (911 Act),[^51] Congress amended Section 222 of
    the Communications Act by adding provisions regarding CPNI. The
    amendments were enacted as incentives for greater deployment of
    wireless E911 services. Congress found that the ultimate key to
    improving the value of the wireless phone as a life-saving safety
    device was ensuring that the proper emergency personnel receive the
    information necessary to perform their duties.[^52] The new CPNI
    provisions are intended to encourage that objective by providing
    separate provisions to protect certain wireless location
    information, and by expressly authorizing carriers to release this
    information to specified third parties for specified emergency
    purposes.[^53] Specifically, Congress added "location" to the
    definition of CPNI,[^54] and amended Section 222(f) to read that
    "\[f\]or the purposes of \[Section 222\](c)(1), without the express
    prior authorization of the customer, a customer shall not be
    considered to have approved the use or disclosure of or access to"
    certain types of location information except in specified emergency
    circumstances.[^55] We seek comment on what affect, if any, the
    provisions of Section 222(f) have on our interpretation of the
    provisions of Section 222(c)(1) and the customer approval
    requirements that are under consideration here.

## Specific Notification Requirements

23. We seek comment on whether modifications should be made to the
    current notification requirements in our rules so that they are most
    effective in ensuring that customers are clearly informed of their
    rights. For example, one approach would be to adopt an opt-in method
    of approval under which a request for oral consent from the customer
    would provide sufficient notification. We seek comment on this
    approach, and on whether the carrier should submit written materials
    to the customer prior to seeking oral consent, or whether the
    carrier may secure consent simultaneously with verbal notification
    of a customer's rights. If oral notification is adequate, how can we
    ensure that the actual subscriber is the person with whom the
    carrier communicates about consent? In other words, how would the
    carrier ensure and document that any oral communication is made
    directly with its subscriber, rather than some other party who might
    answer the phone? Another approach would be to adopt an opt-out
    method of approval under which a carrier would be required to
    provide written notification to the customer of his or her CPNI
    rights, and then afford the customer at least 30 days from receipt
    of the written notice to opt-out before it may use the CPNI in the
    manner requested under the notification. Alternatively, if we adopt
    an opt-out approach without any written notification requirements,
    it may be prudent to find that approval shall not be deemed to occur
    until 30 days after the date of the oral communication with the
    customer. We seek comment on both of these methods. We also seek
    comment on how carriers should manage later requests for privacy
    from the customer. For example, if a customer chooses to opt-out
    after the date on which approval has already been inferred, or, in
    the case of an opt-in mechanism, after the customer revokes an
    express consent previously granted, what would be a reasonable time
    period within which the carrier and its affiliates should be
    required to implement that opt-out request or revocation? In sum, we
    seek comment on all of these approval and notification approaches as
    well as any other options for ensuring that customers receive
    adequate notification of their rights under Section 222 of the Act.

## Interplay of Sections 222 and 272

24. On October 8, 1999, AT&T filed a petition for review of the *CPNI
    Order* with the U.S. Circuit Court of Appeals for the District of
    Columbia, challenging the Commission's CPNI decisions as they relate
    to the interplay between Section 222 and Section 272 of the
    Communications Act.[^56] On July 25, 2000, the D.C. Circuit granted
    the Commission's motion for remand of the AT&T appeal.[^57] As we
    explain below, the consent mechanism that we eventually adopt in
    response to the Tenth Circuit's Order could impact our previous
    findings regarding the interplay between these two sections, and we
    therefore find it necessary to raise the relevant issues here.

25. As stated above, we conclude that the Tenth Circuit only vacated the
    portion of the *CPNI Order* and rules requiring opt-in customer
    approval.[^58] Therefore, our finding in the *CPNI Order*, which we
    affirmed in the *CPNI Reconsideration Order*, that the term
    \"information\" in Section 272(c)(1) does not include CPNI remains
    intact.[^59] Specifically, Section 272(c)(1) states that a Bell
    Operating Company (BOC), in its dealing with its Section 272
    separate affiliate, "may not discriminate between the company or
    affiliate and any other entity in the provision or procurement of
    goods, services, facilities, and information, or in the
    establishment of standards\..." We found that in the context of the
    entire 1996 Act, it is not readily apparent that the meaning of
    \"information\" in Section 272 necessarily includes CPNI, and that
    the most reasonable interpretation of the interplay between Sections
    222 and 272 is that Section 272 "does not impose any additional CPNI
    requirements on BOCs' sharing of CPNI with their Section 272
    affiliates when they share information with their Section 272
    affiliates according to the requirements of Section 222."[^60] We
    found this to be reasonable because if we deemed "information" to
    include CPNI under Section 272(c)(1), then the BOCs would be unable
    to share CPNI with their affiliates to the extent contemplated by
    Section 222, but would instead be subject to the more affirmative
    nondiscrimination requirements in Section 272. Adhering to these
    requirements would mean that BOCs could share CPNI among their 272
    affiliates only pursuant to express approval, and CPNI sharing under
    Section 222(c)(1)(A) (based on implied approval under the total
    service approach) would be precluded.[^61]

26. More specifically, under the terms of Section 272, we found that the
    nondiscrimination requirements contained in that section would, in
    the context of an opt-in approach, "pose a potentially
    insurmountable burden because a BOC soliciting approval to share
    CPNI with its affiliate would have to solicit approval for countless
    other carriers as well, known or unknown"[^62] Although this was
    only one of several reasons supporting our interpretation of the
    interplay between Sections 222 and 272, we would likely have to
    revisit this conclusion if we adopt an opt-out approach as a final
    rule. For example, under an opt-in approach, the CPNI requirements
    operate to make a carrier's anti-competitive use of CPNI more
    difficult by prohibiting carriers from using CPNI unless and until
    they have obtained affirmative customer approval. The only approval
    that is inferred is the approval gained through the total service
    approach, in which case the customer is already receiving service
    from both the BOC and its affiliate.[^63] Under an opt-out approach,
    however, a BOC may be free to share its local customer's CPNI with
    its long distance affiliate regardless of whether the local customer
    has chosen the affiliate as his or her long distance service
    provider. We are concerned about the possible competitive and
    customer privacy ramifications of such an interpretation, and we
    seek comment on whether we should revisit our interpretation of the
    interplay between Sections 222 and 272 if we adopt an opt-out
    approach. In particular, would we have to alter our fundamental
    conclusion that BOCs may share CPNI with their 272 affiliates
    pursuant to Section 222 without regard to the nondiscrimination
    requirements in Section 272? If we retain this conclusion, would
    customers then receive sufficient protection if we adopt procedures
    to ensure effective notice and opportunity for customers to approve
    or disapprove the BOCs' sharing of CPNI with its Section 272
    affiliates? Would customers be fully informed of their rights if we
    required BOCs to explain in an opt-out notification that it may
    share CPNI with its Section 272 affiliates even if the customer does
    not currently subscribe to service from those affiliates? We seek
    comment on these and any other relevant issues.

# PROCEDURAL MATTERS

### Ex Parte Presentations

27. This matter shall be treated as a \"permit‑but‑disclose\" proceeding
    in accordance with the Commission\'s *ex parte* rules.[^64] Persons
    making oral *ex parte* presentations are reminded that memoranda
    summarizing the presentations must contain summaries of the
    substance of the presentations and not merely a listing of the
    subjects discussed. More than a one or two sentence description of
    the views and arguments presented is generally required.[^65] Other
    rules pertaining to oral and written presentations are set forth in
    Section 1.1206(b) as well.

### Initial Regulatory Flexibility Act Analysis

28. Appendix A sets forth the Commission\'s Initial Regulatory
    Flexibility Analysis (IFRA) regarding the policies and rules
    proposed in the *Second Notice of Proposed Rulemaking* in CC Docket
    No. 98-147. 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 *Second Notice*. The
    Commission will send a copy of the *Second Notice*, including this
    IRFA, to the Chief Counsel for Advocacy of the Small Business
    Administration.[^66] In addition, the *Second Notice* and IRFA (or
    summaries thereof) will be published in the Federal Register.[^67]

### Initial Paperwork Reduction Act Analysis

29. The rule changes proposed in the *Second Further Notice of Proposed
    Rulemaking* may cause modifications to the collections of
    information approved by OMB in connection with the *Local
    Competition Second Report and Order*. As part of our continuing
    effort to reduce paperwork burdens, we invite the general public and
    OMB to comment on the information collections contained in this
    *Notice*, as required by the Paperwork Reduction Act of 1995. Public
    and agency comments are due at the same time as other comments on
    this *Notice*; OMB comments are due 60 days from the date of
    publication of notice of this *Notice* in the Federal Register.
    Comments should address: (a) whether the proposed information
    collections are necessary for the proper performance of the
    functions of the Commission, including whether the information shall
    have practical utility; (b) the accuracy of the Commission\'s burden
    estimates; (c) ways to enhance the quality, utility, and clarity of
    the information collected; and (d) ways to minimize the burden of
    the collection of information on the respondents, including the use
    of automated collection techniques or other forms of information
    technology.

### Comment Filing Procedures

30. Pursuant to applicable procedures set forth in Sections 1.415 and
    1.419 of the Commission\'s rules,[^68] interested parties may file
    comments on or before 30 days after publication in the Federal
    Register, and reply comments on or before 45 days after publication
    in the Federal Register. All filings should refer to CC Docket No.
    96-115. Comments may be filed using the Commission\'s Electronic
    Comment Filing System (ECFS) or by filing paper copies.[^69]
    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.
    In completing the transmittal screen, commenters should include
    their full name, Postal Service mailing address, and the applicable
    docket number, which in this instance is CC Docket No. 96-115.
    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.

31. Parties who choose to file by paper must file an original and four
    copies of each filing. All filings must be sent to the Commission\'s
    Secretary, Magalie Roman Salas, Office of the Secretary, Federal
    Communications Commission, Room TW-B204, 445 12th St. S.W.,
    Washington, D.C. 20554.

32. Parties who choose to file by paper should also submit their
    comments on diskette. These diskettes should be submitted to Janice
    Myles, Common Carrier Bureau, Policy & Program Planning Division,
    445 12th Street, S.W., Washington, D.C. 20554. Such a submission
    should be on a 3.5 inch diskette formatted in an IBM compatible
    format using WordPerfect 5.1 for Windows or compatible software. The
    diskette should be accompanied by a cover letter and should be
    submitted in \"read only\" mode. The diskette should be clearly
    labeled with the commenter\'s name, proceeding (including the docket
    number, in this case, CC Docket No. 99-273), type of pleading
    (comment or reply comment), date of submission, and the name of the
    electronic file on the diskette. The label should also include the
    following phrase \"Disk Copy - Not an Original.\" Each diskette
    should contain only one party\'s pleadings, preferably in a single
    electronic file. In addition, commenters must send diskette copies
    to the Commission\'s copy contractor, Qualex International, Portals
    II, 445 12^th^ Street, SW, Room CY-B402, Washington, DC 20554.

33. Regardless of whether parties choose to file electronically or by
    paper, parties should also file one copy of any documents filed in
    this docket with the Commission\'s copy contractor, Qualex
    International, Portals II, 445 12^th^ Street, SW, Room CY-B402,
    Washington, DC 20554.Comments and reply comments will be available
    for public inspection during regular business hours in the FCC
    Reference Center, Room CY-A257, 445 12th Street, S.W., Washington,
    D.C. 20554.

34. Comments and reply comments must include a short and concise summary
    of the substantive arguments raised in the pleading. Comments and
    reply comments must also comply with Section 1.49 and all other
    applicable sections of the Commission\'s rules.[^70] We also direct
    all interested parties to include the name of the filing party and
    the date of the filing on each page of their comments and reply
    comments. All parties are encouraged to utilize a table of contents,
    regardless of the length of their submission. We also strongly
    encourage that parties track the organization set forth in this
    *Notice* in order to facilitate our internal review process.

35. Written comments by the public on the proposed and/or modified
    information collections are due on or before 30 days after
    publication in the Federal Register, and reply comments on or before
    45 days after publication in the Federal Register. Written comments
    must be submitted by the OMB on the proposed and/or modified
    information collections on or before 60 days after date of
    publication of notice of this *Notice of Proposed Rulemaking* in the
    Federal Register. In addition to filing comments with the Secretary,
    a copy of any comments on the information collections contained
    herein should be submitted to Judy Boley, Federal Communications
    Commission, 1‑C804, 445 12th Street, S.W., Washington, D.C. 20554 or
    via the Internet to jboley@fcc.gov and to Virginia Huth, OMB Desk
    Officer, 10236 NEOB, 725 17th Street, N.W., Washington, D.C. 20503,
    or via the Internet to vhuth@omb.eop.gov.

    **XI. ORDERING CLAUSES**

36. Accordingly, IT IS ORDERED that pursuant to Sections 1, 4(i), 222
    and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C.
    §§ 151, 154(i), 222 and 303(r), the CLARIFICATION ORDER and SECOND
    FURTHER NOTICE OF PROPOSED RULEMAKING ARE ADOPTED. The requirements
    of this Order shall become effective 30 days after publication of a
    summary thereof in the Federal Register.

37. IT IS FURTHER ORDERED that the Commission's Office of Public
    Affairs, Reference Operations Division, SHALL SEND a copy of this
    Clarification Order and Second Further Notice of Proposed
    Rulemaking, including the Initial Regulatory Flexibility Analysis,
    to the Chief Counsel for Advocacy of the Small Business
    Administration.

    FEDERAL COMMUNICATIONS COMMISSION

    Magalie Roman Salas

Secretary

# APPENDIX A -- INITIAL REGULATORY FLEXIBILITY ANALYSIS {#appendix-a-initial-regulatory-flexibility-analysis .unnumbered}

1.  As required by the Regulatory Flexibility Act (RFA), as
    amended,[^71] the Commission has prepared this present Initial
    Regulatory Flexibility Analysis (IRFA) of the expected significant
    economic impact on small entities by the policies and rules proposed
    in this *Second Further Notice of Proposed Rulemaking* (*Second
    Further Notice*)*.* Written public comments are requested on this
    IRFA. Comments must be identified as responses to the IRFA and must
    be filed by the deadlines for comments on the *Second Further
    Notice*. The Commission will send a copy of the *Second Further
    Notice*, including this IRFA, to the Chief Counsel for Advocacy of
    the Small Business Administration. *See* 5 U.S.C. § 603(a). In
    addition, the *Second Further Notice* and IRFA (or summaries
    thereof) will be published in the Federal Register.

## Need for, and Objectives of, the Proposed Rules

38. The Commission is issuing the *Second Further Notice* to seek
    comment on an appropriate method by which carriers must secure their
    customers' consent to use the customer's CPNI. This is necessary to
    respond to the Tenth Circuit's decision vacating the opt-in consent
    method. Under the opt-in method, a carrier was required to notify
    the customer of his or her rights with regard to CPNI and then
    obtain express written, oral or electronic customer approval before
    the carrier may use CPNI to market services to the customer that are
    outside the existing service relationship that the customer has with
    the carrier. The opt-in method is distinguished from the opt-out
    method under which approval to use the customer's CPNI is inferred
    from the customer-carrier relationship unless the customer requests
    specifically that his or her CPNI be restricted.

39. The Tenth Circuit concluded that although the Commission had
    asserted that the opt-in method would protect consumer privacy and
    promote competition for telecommunications services in accordance
    with the goals of Section 222 of the Act,[^72] it did not
    demonstrate that opt-in directly and materially advanced these
    interests. The court concluded that the Commission's determination
    that an opt-in requirement would best protect a consumer's privacy
    interests was not narrowly tailored because the Commission had
    failed to adequately consider an opt-out option. The court stated
    that an opt-out option should have been more fully investigated as
    it is inherently less restrictive of speech. Further, the court
    ruled the Commission did not adequately show that an opt-out
    strategy would not offer sufficient protection of consumer
    privacy.[^73] In vacating portions of the *CPNI Order*, the court
    did not require the Commission to find specifically that the opt-out
    option was the correct approach. Instead, it found fault with the
    Commission's "inadequate consideration of the approval mechanism
    alternatives in light of the First Amendment."[^74]

40. Taking into account the Tenth Circuit's concerns, we seek comment in
    the *Second Further Notice* on several significant issues concerning
    what methods of approval would serve the governmental interests at
    issue under Section 222 of the Act, and afford informed consent,
    while also satisfying the constitutional requirement that any
    restrictions on speech be narrowly tailored. We seek comment
    specifically on the extent to which an opt-in or opt-out method of
    customer approval would be consistent with both the court's concerns
    and Section 222, and on whether we should make modification to our
    customer notification requirements in Section 64.7002 of our rules,
    47 C.F.R. § 64.7002, based on the form of approval that we
    adopt.[^75]

41. We also ask for information on any potential harms to business
    entities, especially smaller business entities within the class of
    companies directly affected by the proposed rule, that may arise
    from adopting either an opt-in or opt-out approach, including the
    extent to which dissemination of CPNI would affect a customer's
    privacy.[^76] We also ask for comment on how we can ensure that the
    consent approach we adopt balances the interests of privacy,
    competition, equity and efficiency.[^77]

42. In addition, we ask parties to indicate whether or not adoption of
    an opt-out mechanism undermines the total service approach. The
    total service approach is not a consent mechanism like the opt-in or
    opt-out approach, but instead describes the scope of services for
    which a customer grants his or her consent for the carrier to use
    CPNI. Specifically, under the total service approach, the customer's
    implied approval is limited to the parameters of the customer's
    existing service, while the customer must grant the carrier
    affirmative approval in order for the carrier to use the customer's
    CPNI to market other services to the customer. If a carrier need not
    obtain the customer's affirmative approval to market services not
    already subscribed to by the customer, is it necessary or
    appropriate for us to adopt an alternative to the total service
    approach.[^78]

## Legal Basis

43. The *Second Further Notice* is adopted pursuant to Sections 1, 4(i),
    222, and 303(r) of the Communications Act of 1934, as amended, 47
    U.S.C. §§ 151, 154(i), 222, and 303(r).

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

44. 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 our rules.[^79] The RFA generally defines the term
    \"small entity\" as having the same meaning as the terms \"small
    business,\" \"small organization,\" and \"small governmental
    jurisdiction.\"[^80] For the purposes of this order, the RFA defines
    a \"small business\" to be the same as a \"small business concern\"
    under the Small Business Act, 15 U.S.C. s 632, unless the Commission
    has developed one or more definitions that are appropriate to its
    activities.[^81] Under the Small Business Act, a \"small business
    concern\" is one that: (1) is independently owned and operated; (2)
    is not dominant in its field of operation; and (3) meets any
    additional criteria established by the Small Business Administration
    (SBA).[^82] The SBA has defined a small business for Standard
    Industrial Classification (SIC) categories 4812 (Radiotelephone
    Communications) and 4813 (Telephone Communications, Except
    Radiotelephone) to be small entities when they have no more than
    1,500 employees.[^83] We first discuss generally the total number of
    small telephone companies falling within both of those SIC
    categories. Then, we discuss the number of small businesses within
    the two subcategories, and attempt to refine further those estimates
    to correspond with the categories of telephone companies that are
    commonly used under our rules.

45. .Although affected incumbent local exchange carriers (ILECs) may
    have no more than 1,500 employees, we do not believe that such
    entities should be considered small entities within the meaning of
    the RFA because they either are dominant in their field of
    operations or are not independently owned and operated, and are
    therefore by definition not \"small entities\" or \"small business
    concerns\" under the RFA. Accordingly, our use of the terms \"small
    entities\" and \"small businesses\" does not encompass small ILECs.
    Out of an abundance of caution, however, for regulatory flexibility
    analysis purposes, we will separately consider small ILECs within
    this analysis and use the term \"small ILECs\" to refer to any ILECs
    that arguably might be defined by SBA as \"small business
    concerns.\"[^84]

46. *Total Number of Telephone Companies Affected*. The United States
    Bureau of the Census (the Census Bureau) reports that at the end of
    1992, there were 3,497 firms engaged in providing telephone
    services, as defined therein, for at least one year.[^85] This
    number contains a variety of different categories of carriers,
    including local exchange carriers, interexchange carriers,
    competitive access providers, cellular carriers, mobile service
    carriers, operator service providers, pay telephone operators, PCS
    providers, covered SMR providers, and resellers. It seems certain
    that some of those 3,497 telephone service firms may not qualify as
    small entities because they are not \"independently owned and
    operated.\"[^86] For example, a PCS provider that is affiliated with
    an interexchange carrier having more than 1,500 employees would not
    meet the definition of a small business. It seems reasonable to
    conclude, therefore, that fewer than 3,497 telephone service firms
    are either small entities or small incumbent LECs that may be
    affected by this order.

47. *Wireline Carriers and Service Providers*. The SBA has developed a
    definition of small entities for telephone communications companies
    other than radiotelephone (wireless) companies. The Census Bureau
    reports there were 2,321 such telephone companies in operation for
    at least one year at the end of 1992.[^87] According to the SBA\'s
    definition, a small business telephone company other than a
    radiotelephone company is one employing fewer than 1,500
    persons.[^88] All but 26 of the 2,321 non‑radiotelephone companies
    listed by the Census Bureau were reported to have fewer than 1,000
    employees. Thus, even if all 26 of those companies had more than
    1,500 employees, there would still be 2,295 non‑radiotelephone
    companies that might qualify as small entities or small incumbent
    LECs. Although it seems certain that some of these carriers are not
    independently owned and operated, we are unable at this time to
    estimate with greater precision the number of wireline carriers and
    service providers that would qualify as small business concerns
    under the SBA\'s definition. Consequently, we estimate that fewer
    than 2,295 small entity telephone communications companies other
    than radiotelephone companies are small entities or small ILECs that
    may be affected by this order.

48. *Local Exchange Carriers*. Neither the Commission nor the SBA has
    developed a definition of small providers of local exchange
    services. The closest applicable definition under the SBA\'s rules
    is for telephone communications companies other than radiotelephone
    (wireless) companies. The most reliable source of information
    regarding the number of LECs nationwide of which we are aware
    appears to be the data that we collect annually in connection with
    the Telecommunications Relay Service (TRS).[^89] According to our
    most recent data, there are 1,335 incumbent LECs, 349 competitive
    LECs, and 87 resellers.[^90] Although it seems certain that some of
    these carriers are not independently owned and operated, or have
    more than 1,500 employees, we are unable at this time to estimate
    with greater precision the number of LECs that would qualify as
    small business concerns under the SBA\'s definition. Consequently,
    we estimate that there are fewer than 1,335 small entity incumbent
    LECs, 349 competitive LECs, and 87 resellers that may be affected by
    the proposals in the *Second Further Notice*.

49. *Interexchange Carriers*. Neither the Commission nor the SBA has
    developed a definition of small entities specifically applicable to
    providers of interexchange services (IXCs). The closest applicable
    definition under the SBA\'s rules is for telephone communications
    companies other than radiotelephone (wireless) companies. The most
    reliable source of information regarding the number of IXCs
    nationwide of which we are aware appears to be the data that we
    collect annually in connection with TRS. According to our most
    recent data, 204 companies reported that they were engaged in the
    provision of interexchange services.[^91] Although it seems certain
    that some of these carriers are not independently owned and
    operated, or have more than 1,500 employees, we are unable at this
    time to estimate with greater precision the number of IXCs that
    would qualify as small business concerns under the SBA\'s
    definition. Consequently, we estimate that there are fewer than 204
    small entity IXCs that may be affected by this order.

50. *Competitive Access Providers*. Neither the Commission nor the SBA
    has developed a definition of small entities specifically applicable
    to providers of competitive access services (CAPs). The closest
    applicable definition under the SBA\'s rules is for telephone
    communications companies other than radiotelephone (wireless)
    companies. The most reliable source of information regarding the
    number of CAPs nationwide of which we are aware appears to be the
    data that we collect annually in connection with the TRS. According
    to our most recent data, 349 companies reported that they were
    engaged in the provision of either competitive access services or
    competitive local exchange service.[^92] Although it seems certain
    that some of these carriers are not independently owned and
    operated, or have more than 1,500 employees, we are unable at this
    time to estimate with greater precision the number of CAPs that
    would qualify as small business concerns under the SBA\'s
    definition. Consequently, we estimate that there are fewer than 349
    small entity CAPs that may be affected by this order.

51. *Operator Service Providers*. Neither the Commission nor the SBA has
    developed a definition of small entities specifically applicable to
    providers of operator services. The closest applicable definition
    under the SBA\'s rules is for telephone communications companies
    other than radiotelephone (wireless) companies. The most reliable
    source of information regarding the number of operator service
    providers nationwide of which we are aware appears to be the data
    that we collect annually in connection with the TRS. According to
    our most recent data, 21 companies reported that they were engaged
    in the provision of operator services.[^93] Although it seems
    certain that some of these companies are not independently owned and
    operated, or have more than 1,500 employees, we are unable at this
    time to estimate with greater precision the number of operator
    service providers that would qualify as small business concerns
    under the SBA\'s definition. Consequently, we estimate that there
    are fewer than 21 small entity operator service providers that may
    be affected by this order.

52. *Pay Telephone Operators*. Neither the Commission nor the SBA has
    developed a definition of small entities specifically applicable to
    pay telephone operators. The closest applicable definition under the
    SBA\'s rules is for telephone communications companies other than
    radiotelephone (wireless) companies. The most reliable source of
    information regarding the number of pay telephone operators
    nationwide of which we are aware appears to be the data that we
    collect annually in connection with the TRS. According to our most
    recent data, 758 companies reported that they were engaged in the
    provision of pay telephone services.[^94] Although it seems certain
    that some of these carriers are not independently owned and
    operated, or have more than 1,500 employees, we are unable at this
    time to estimate with greater precision the number of pay telephone
    operators that would qualify as small business concerns under the
    SBA\'s definition. Consequently, we estimate that there are fewer
    than 758 small entity pay telephone operators that may be affected
    by this order.

53. *Wireless Carriers*. The SBA has developed a definition of small
    entities for radiotelephone (wireless) companies. The Census Bureau
    reports that there were 1,176 such companies in operation for at
    least one year at the end of 1992.[^95] According to the SBA\'s
    definition, a small business radiotelephone company is one employing
    no more than 1,500 persons.[^96] The Census Bureau also reported
    that 1,164 of those radiotelephone companies had fewer than 1,000
    employees. Thus, even if all of the remaining 12 companies had more
    than 1,500 employees, there would still be 1,164 radiotelephone
    companies that might qualify as small entities if they are
    independently owned are operated. Although it seems certain that
    some of these carriers are not independently owned and operated, we
    are unable at this time to estimate with greater precision the
    number of radiotelephone carriers and service providers that would
    qualify as small business concerns under the SBA\'s definition.
    Consequently, we estimate that there are fewer than 1,164 small
    entity radiotelephone companies that may be affected by this order.

54. *Cellular Service and Mobile Service Carriers*. Neither the
    Commission nor the SBA has developed a definition of small entities
    specifically applicable to providers of cellular services. The
    closest applicable definition under the SBA\'s rules is for
    telephone communications companies other than radiotelephone
    (wireless) companies. The most reliable source of information
    regarding the number of cellular service carriers nationwide of
    which we are aware appears to be the data that we collect annually
    in connection with the TRS. According to our most recent data, 806
    companies reported that they were engaged in the provision of
    cellular services.[^97] Although it seems certain that some of these
    carriers are not independently owned and operated, or have more than
    1,500 employees, we are unable at this time to estimate with greater
    precision the number of cellular service and mobile service carriers
    that would qualify as small business concerns under the SBA\'s
    definition. Consequently, we estimate that there are fewer than 804
    small entity cellular service carriers that may be affected by this
    order.

55. *Broadband PCS Licensees.* 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 less than \$40 million in the three previous calendar
    years.[^98] 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.[^99] These
    regulations defining \"small entity\" in the context of broadband
    PCS auctions have been approved by SBA.[^100] No small businesses
    within the SBA-approved definition 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% of the 1,479 licenses
    for Blocks D, E, and F. Based on this information, we estimate that
    the number of small broadband PCS licenses will include the 90
    winning C Block bidders and the 93 qualifying bidders in the D, E,
    and F blocks, for a total of 183 small PCS providers as defined by
    SBA and the Commissioner\'s auction rules.

56. *SMR Licensees.* Pursuant to 47 C.F.R. § 90.814(b)(1), the
    Commission has defined \"small entity\" in auctions for *geographic*
    area 800 MHz and 900 MHz SMR licenses as a firm that had average
    annual gross revenues of less than \$15 million in the three
    previous calendar years. The definition of a \"small entity\" in the
    context of 800 and 900 MHz SMR has been approved by the SBA. The
    proposed rules may apply to SMR providers in the 800 MHz and 900 MHz
    bands that either hold geographic area licenses or have obtained
    extended implementation authorizations. We do not know how many
    firms provide 800 MHz or 900 MHz geographic area SMR service
    pursuant to extended implementation authorizations, nor how many of
    these providers have annual revenues of less than \$15 million.
    Consequently, we estimate, for purposes of this IRFA, that all of
    the extended implementation authorizations may be held by small
    entities, some of which may be affected by the rules proposed in the
    Notice.

57. The Commission recently held auctions for geographic area licenses
    in the 900 MHz SMR band. There were 60 winning bidders who qualified
    as small entities in the 900 MHz auction. Based on this information,
    we estimate that the number of geographic area SMR licensees that
    may be affected by the decisions and rules proposed in the Notice
    includes these 60 small entities. No auctions have been held for 800
    MHz geographic area SMR licenses. Therefore, no small entities
    currently hold these licenses. A total of 525 licenses will be
    awarded for the upper 200 channels in the 800 MHz geographic area
    SMR auction. The Commission, however, has not yet determined how
    many licenses will be awarded for the lower 230 channels in the 800
    MHz geographic area SMR auction. There is no basis, moreover, on
    which to estimate how many small entities will win these licenses.
    Given that nearly all radiotelephone companies have fewer than 1,000
    employees and that no reliable estimate of the number of prospective
    800 MHz licensees can be made, we estimate, for purposes of this
    IRFA, that all of the licenses may be awarded to small entities,
    some of which may be affected by the decisions and rules proposed in
    the Notice.

58. *Narrowband PCS*. The Commission has auctioned nationwide and
    regional licenses for narrowband PCS. There are 11 nationwide and 30
    regional licensees for narrowband PCS. The Commission does not have
    sufficient information to determine whether any of these licensees
    are small businesses within the SBA-approved definition for
    radiotelephone companies. At present, there have been no auctions
    held for the major trading area (MTA) and basic trading area (BTA)
    narrowband PCS licenses. The Commission anticipates a total of 561
    MTA licenses and 2,958 BTA licenses will be awarded by auction. Such
    auctions have not yet been scheduled, however. Given that nearly all
    radiotelephone companies have no more than 1,500 employees and that
    no reliable estimate of the number of prospective MTA and BTA
    narrowband licensees can be made, we assume, for purposes of this
    IRFA, that all of the licenses will be awarded to small entities, as
    that term is defined by the SBA.

59. *Toll Resellers*. Neither the Commission nor the SBA has developed a
    definition of small entities specifically applicable to resellers.
    The closest applicable definition under the SBA\'s rules is for all
    telephone communications companies. The most reliable source of
    information regarding the number of toll resellers nationwide of
    which we are aware appears to be the data that we collect annually
    in connection with the TRS. According to our most recent data, 454
    companies reported that they were engaged in the resale of telephone
    toll services.[^101] Although it seems certain that some of these
    carriers are not independently owned and operated, or have more than
    1,500 employees, we are unable at this time to estimate with greater
    precision the number of toll resellers that would qualify as small
    business concerns under the SBA\'s definition. Consequently, we
    estimate that there are fewer than 454 small entity resellers that
    may be affected by this order.

## Description of Projected Reporting, Recordkeeping and Other Compliance Requirements

60. Because we have not made any tentative conclusions or suggested
    proposed rules, we are unable at this time to describe any projected
    reporting, recordkeeping, or other compliance requirements.

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

61. 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.[^102]

62. As noted above, we do not propose a specific method for how carriers
    should obtain customer consent to use CPNI for marketing purposes,
    rather we seek comment on ways in which carriers can obtain their
    customers' consent and the extent to which an opt-in or opt-out
    approach would satisfy both Section 222 and the Tenth Circuit's
    concerns that any restrictions on speech be no more than necessary
    to serve the asserted state interests. Section 222 applies to all
    telecommunications carriers, and therefore, any rules that we adopt
    regarding customer consent will be applicable to all carriers.[^103]
    Accordingly, we cannot exempt small entities from complying with any
    consent rules that we adopt.

63. We have, however, taken the limited resources of small entities into
    account in promulgating certain existing CPNI rules,[^104] and
    intend to do so again in addressing the customer consent
    requirements. Specifically, we recognize that an opt-in approach
    would require small entities to have a process in place to obtain
    express approval from their customers to use CPNI. While such a
    process could place a burden on small entities in terms of
    developing, tracking and maintaining customer consent, it would
    confer a countervailing benefit by permitting them to gain approval
    to use a customer's CPNI for a broad range of service offerings with
    a single request through written, oral or electronic means that
    remains in effect unless or until the customer revokes it.[^105]
    Therefore, we ask parties to comment on whether the burden outweighs
    the benefit under an opt-in scheme.

64. We also note that the Commission, in response to concerns from all
    carriers about the cost of compliance, has already streamlined the
    "flagging" and "audit trail" requirements that are required to
    protect against unauthorized access to a customer's CPNI.[^106]
    Small entities may continue to take advantage of these streamlined
    rules even if the Commission adopts an opt-in requirement.

65. Under an opt-out approach, a small entity need not obtain express
    approval, but would only be required to notify its customers of
    their CPNI rights and then process any requests for privacy after
    such notification. This could be less administratively onerous than
    obtaining opt-in approval. However, we seek comment indicating small
    entities' perception of the probable impact of this burden.

66. We ask small entities to particularly keep in mind these types of
    requirements when they comment in the *Second Further Notice* on any
    potential harms that may arise from adopting either form of
    consent,[^107] and overall, we ask for comment in response to this
    IRFA on what competitive or economic impact either an opt-in or
    opt-out approach would have on small entities and on whether there
    is any alternative form of consent that we should consider to
    minimize the economic impact on them.

## Federal Rules that May Duplicate, Overlap, or Conflict with the Proposed Rules

67. None.

# Separate Statement of Commissioners  {#separate-statement-of-commissioners .unnumbered}

# Gloria tristani and Michael j. copps {#gloria-tristani-and-michael-j.-copps .unnumbered}

Re: *Carriers' Use of Customer Proprietary Network Information and Other
Customer Information; Implementation of the Non-Accounting Safeguards of
Sections 271 and 272 of the Communications Act of 1934, As Amended*

Today the Commission issues a Further Notice to develop a record that
allows us to implement Section 222 of the Communications Act, the
customer proprietary network information (CPNI) provision, consistent
with the direction provided by the 10th Circuit Court of Appeals in
*U.S. West, Inc. v. Federal Communications Commission*.[^108] This
proceeding should result in CPNI rules that provide industry with
certainty regarding the legal use of customer information for marketing
and other purposes. At issue here is whether the rules will also provide
customers with the ability to make an express decision regarding whether
and how their personal information will be used.

Our overriding responsibility in this remanded proceeding is to follow
the specific substantive instructions of Congress supported by a record
that has the scope and depth required by the 10^th^ Circuit. Congress
expressly stated that "\[e\]very telecommunications carrier has a duty
to protect the confidentiality of proprietary information of, and
relating to . . . customers."[^109] Congress added that a
telecommunications carrier that receives or obtains CPNI by virtue of
its provision of a telecommunication service shall only use, disclose,
or permit access to individually identifiable CPNI "with the approval of
the customer."[^110] Congress has already made the public policy
decision that telephone consumers deserve special privacy protection for
CPNI, and that no such information should be used without approval.

We write separately because we believe that in order to comply with
Section 222, the Commission should have expressed continued support for
its current CPNI policy, seeking comment on the nature of the government
interest in privacy, the potential harm to privacy to which consumers
are exposed, and whether our approach is no more extensive than
necessary to serve the interest of protecting personal privacy. In the
1998 *CPNI Order*,[^111] the Commission considered the concerns that
Congress addressed with the adoption of Section 222, namely, the strong
interest of consumers in keeping sensitive information private. The
Commission determined that a common sense interpretation of the word
"approval" as used in the statute suggested that it required "a knowing
acceptance" by a customer that its carrier would be using the customer's
CPNI for marketing services outside those services currently being
subscribed to by the customer.[^112] Simply put, the Commission
determined that an affirmative approval requirement, the opt-in method,
rather than a passive approval requirement, the opt-out method, provided
the level of protection of privacy interests that Congress chose.[^113]
We continue to believe this is the correct interpretation of Section
222. We hope the neutral approach taken here does not reflect this
Commission\'s reconsideration of this fundamental policy choice.

The 10^th^ Circuit found that our proceeding relied on a record that did
not allow it to make several findings needed to uphold our CPNI Order in
the face of a First Amendment challenge. At the same time, the 10^th^
Circuit made a special point of explaining that it did not "advocate"
that the Commission change its decision to require the opt-in approach.
Nor did it advocate that the Commission take another approach, by, for
example, deciding to change course and allow the opt-out approach.[^114]

Instead, the 10^th^ Circuit found that the record in this proceeding was
inadequate. To respond to the court's decision, first we must provide
"more empirical explanation and justification for the government's
asserted interest" in protecting consumer privacy and in promoting
competition.[^115] Without this information the Court could not
determine whether those interests were "substantial" in its First
Amendment analysis.[^116] Second, we must seek a more complete record on
the question of whether harms to consumer privacy and competition "are
real" and whether an opt-in approach "will in fact alleviate them to a
material degree."[^117] Third, we must provide additional consideration
of whether opt-in is " 'no more extensive than necessary to serve \[the
stated\] interest\[s\].' "[^118] The court's decision, as demonstrated
above, was based on an incomplete record, not on a flawed outcome.

We emphasize the importance of expeditiously collecting and analyzing
the relevant data and then proceeding to carry Congress's will. Our
charge from Congress is to ensure that carriers only use, disclose, or
permit access to individually identifiable CPNI "with the approval of
the customer."[^119] Congress chose to enact a tough requirement for
carriers and it is our duty to implement it.

[^1]: *U S WEST, Inc. v. FCC*, 182 F.3d 1224 (10^th^ Cir. 1999), *cert.
    denied,* 120 S. Ct. 2215 (Jun. 5, 2000) (No. 99-1427) (*U S WEST v.
    FCC*).

[^2]: *Implementation of the Telecommunications Act of 1996:
    Telecommunications Carriers' Use of Customer Proprietary Network
    Information and Other Customer Information and Implementation of the
    Non-Accounting Safeguards of Sections 271 and 272 of the
    Communications Act of 1934, as amended,* CC Docket Nos. 96-115 and
    96-149, Order and Further Notice of Proposed Rulemaking, 13 FCC Rcd
    8061 (1998) (*CPNI Order*). The Commission also released a *Further
    Notice of Proposed Rulemaking* on February 26, 1998 seeking comment
    on three general issues that principally involve carrier duties and
    obligations established under Sections 222(a) and (b) of the Act.
    *CPNI Order*, 13 FCC Rcd at 8200-04, paras. 203-10. This Further
    Notice remains pending.

[^3]: *CPNI Order*, 13 FCC Rcd at 8064, para. 2.

[^4]: *AT&T v. FCC*, No. 99-1413 (D.C. Cir. July 25, 2000).

[^5]: *Implementation of the Telecommunications Act of 1996:
    Telecommunications Carriers\' Use of Customer Proprietary Network
    Information and Other Customer Information*, Notice of Proposed
    Rulemaking, CC Docket No. 96-115, 11 FCC Rcd 12513 (1996) (*NPRM*).

[^6]: *CPNI Order*, 13 FCC Rcd 8065, para. 3 (citing the Joint statement
    of Mangers, S. Conf. Rep. No. 104-230, 104^th^ Cong., 2d Sess., 1
    (1996).

[^7]: *CPNI Order*, 13 FCC Rcd at 8066, para. 3 ("Indeed, in provisions
    governing use of aggregate customer and subscriber list information,
    Sections 222(c)(3) and 222(e) respectively, where privacy of
    sensitive information is by definition *not* at stake, Congress
    expressly *required* carriers to provide such information to third
    parties on nondiscriminatory terms and conditions.").

[^8]: *CPNI Order*, 13 FCC Rcd at 8080, 8083-84, 8087-88, paras. 23-24,
    30, 35.

[^9]: *Id.* at 8127-45, paras. 86--107; *see also* *U S WEST v. FCC*,
    182 F.3d at 1230. This approach is distinguished from an "opt-out"
    or negative option approach "in which approval would be inferred
    from the customer-carrier relationship unless the customer
    specifically requested that his or her CPNI be restricted." *U S
    WEST v. FCC*, 182 F.3d at 1230.

[^10]: *Implementation of the Telecommunications Act of 1996:
    Telecommunications Carriers\' Use of Customer Proprietary Network
    Information and Other Customer Information and Implementation of the
    Non-Accounting Safeguards of Sections 271 and 272 of the
    Communications Act of 1934, as amended*, CC Docket Nos. 96-115 and
    96-149, Order on Reconsideration and Petitions for Forbearance, 14
    FCC Rcd 14409 (1999) (*CPNI Reconsideration Order.*). On November 1,
    1999, MCI Communications Corp. filed a Petition for Further
    Reconsideration. We will address MCI's Petition in a separate order.

[^11]: *CPNI Reconsideration Order*, 14 FCC Rcd at 14464*,* paras.
    *109-110*. In particular, the Order expanded Section 64.2005 of the
    Commission's rules, 47 C.F.R. § 64.2005, which codifies the total
    service approach, to include customer premises equipment and some
    information services.

[^12]: Only one carrier, Omnipoint Communications, Inc., requested that
    we reconsider that the Commission "opt-in" approach, and limited its
    request to CMRS carriers only. *CPNI Reconsideration Order*, 14 FCC
    Rcd at 14463-64, paras. 107-08. The Commission denied Omnipoint's
    request and declined to reconsider its original finding that "the
    requirement of affirmative consent is consistent with Congressional
    intent, as well as principles of customer control and convenience."
    *Id.*

[^13]: *U S WEST v. FCC*, 182 F.3d at 1240.

[^14]: *Id*. at 1231.

[^15]: *See Chevron USA Inc. v. Natural Resources Defense Council,
    Inc*., 467 U.S. 837 (1984) (*Chevron*).

[^16]: 447 U.S. 557 (1980) (*Central Hudson*).

[^17]: *See U S WEST v. FCC*, 182 F.3d at ­­1233-34 (citing *Central
    Hudson*, 447 U.S. at 564-66).

[^18]: *U S West v.* FCC, 182 F.3d at 1235-37.

[^19]: *Id.*

[^20]: *Id*. at 1238-39.

[^21]: *Id.* at 1240, n. 15 ("The dissent accuses us of 'advocating' an
    opt-out approach. We do not 'advocate' any specific approach.").

[^22]: *See* *AT&T Corp., v. New York Telephone Company, d/b/a Bell
    Atlantic -- New York*, File No. EB-00-MD-011, Memorandum Opinion and
    Order, FCC 00-362, para. 17 (rel. Oct. 6, 2000) (*AT&T v. Bell
    Atlantic Order*) (concluding, in the context of a formal complaint
    regarding certain CPNI issues, that "when read in context, the
    \[Tenth Circuit's\] vacatur order related only to the discrete
    portions of the order and rules that were before the court in light
    of the parties' petitions for review and addressed by the court.").

[^23]: 47 C.F.R. § 64.2007(c). This provision, pertaining to "oral
    approval," would be superfluous under an opt-out regime. In
    contrast, the remaining provisions of Section 64.2007 address
    primarily consumer notification requirements that are applicable
    under any approval regime.

[^24]: 47 C.F.R. § 64.2007(f). Subsequent references to \"Section
    64.2007\" shall mean that section of our rules.

[^25]: *CPNI Order*, 13 FCC Rcd at 8161-63, paras. 135-38; *CPNI
    Reconsideration Order*, 14 FCC Rcd at 14464, para. 109

[^26]: *CPNI Order*, 13 FCC Rcd at 8151, para. 116.

[^27]: *See CPNI Reconsideration Order*, 14 FCC Rcd at 14420-48, paras.
    16-74.

[^28]: *CPNI Order*, 13 FCC Rcd at 8073, para. 14.

[^29]: *Id.*

[^30]: Section 222(c)(1) states,

    > Except as required by law or with the approval of the customer, a
    > telecommunications carrier that receives or obtains customer
    > proprietary network information by virtue of its provision of a
    > telecommunication service shall only use, disclose, or permit
    > access to individually identifiable customer proprietary network
    > information in its provision of (A) the telecommunications service
    > from which such information is derived, or (B) services necessary
    > to, or used in, the provision of such telecommunications service,
    > including the publishing of directories.

[^31]: *CPNI Order*, 13 FCC Rcd at 8128, para. 87.

[^32]: *Id.* at 8130-45, paras. 91-107.

[^33]: *Id.* at 8100, para. 51.

[^34]: *Id.* at 8134, para. 95.

[^35]: *U S West v. FCC*, 182 F.3d at 1238-39.

[^36]: *See* Gramm-Leach-Bliley Act, Title V, Pub. L. No. 106-102, 113
    Stat. 1338 (1999) (requires certain federal agencies to adopt rules
    implementing notice requirements and restrictions on the ability of
    financial institutions to disclose nonpublic personal information
    about consumers to nonaffiliated third parties. The rules
    promulgated pursuant to the Act also describe conditions under which
    a financial institution may disclose nonpublic information about a
    consumer and provide a method for a consumer to opt-out of the
    disclosure of that information. *See, e.g.* 17 CFR Part 160; 66 FR
    21236 (Apr. 27, 2001) (final implementing rules adopted by the
    Commodity Futures Trading Commission)), and 65 FR 82462 (Dec. 28,
    2000) (announcing final rule, promulgated pursuant to the Health
    Insurance Portability and Accountability Act of 1996, Pub. L. No.
    104-191, that establishes standards to protect the privacy of
    individually identifiable health information. The rule requires, in
    most instances, that health care providers who have a direct
    treatment relationship with their patients obtain affirmative opt-in
    consent of their patients in order to use and disclose protected
    health information for treatment, payment and health care
    operations).

[^37]: *CPNI Order*, 13 FCC Rcd at 8065-66, para. 3.

[^38]: *U S WEST v. FCC*, 182 F.3d at 1234 (emphasis added).

[^39]: *Id.* at 1235.

[^40]: *Id.*

[^41]: *Id.* at 1236-37.

[^42]: *Id.* at 1235.

[^43]: *Id.* at 1236-37.

[^44]: *Id.* at 1237.

[^45]: *Id.*.

[^46]: *Id.* at 1238-39.

[^47]: *CPNI Order*, 13 FCC Rcd at 8084-8113, paras. 32-67.

[^48]: *CPNI Reconsideration Order*, 14 FCC Rcd at 14430-35*,* paras. 40
    -- 47; 47 C.F.R. § 64.2005(b)(1).

[^49]: *Amendment of Section 64.702 of the Commission's Rules and
    Regulations*, CC Docket No. 20828, Final Decision, 77 FCC 2d 384
    (1980).

[^50]: *Policy and Rules Concerning the Interstate, Interexchange
    Marketplace, Implementation of Section 254(g) of the Communications
    Act of 1934, as amended*, CC Docket No. 96-16; *1998 Biennial
    Regulatory Review -- Review of Customer Premises Equipment and
    Enhanced Services Unbundling Rules in the Interexchange, Exchange
    Access and Local Exchange Market*, CC Docket No. 98-183, Report and
    Order, FCC 01-98 (rel. March 30, 2001).

[^51]: Pub. L. No. 106-81, enacted Oct. 26, 1999, 113 Stat. 1286,
    amending the Communications Act of 1934, 47 U.S.C. §§ 222, 251.

[^52]: H.R. Rep. No. 106-25, at 9 (1999) (House Report).

[^53]: House Report at 5, S. Rep. No. 106-138, 2 (1999) (Senate Report).

[^54]: Revised 47 U.S.C. § 222(h)(1)(A); new 47 U.S.C. § 222(f).

[^55]: New 47 U.S.C. § 222(f). Without express prior authorization, a
    carrier may only provide "call location information concerning the
    user of a commercial mobile service," as such term is defined in
    Section 332(d) of the Communications Act, to "a public safety
    answering point, emergency medical service provider or emergency
    dispatch provider, public safety, fire service, or law enforcement
    official, or hospital emergency or trauma care facility, in order to
    respond to the user's call for emergency services; to inform the
    user's legal guardian or member's of the user's immediate family of
    the user's location in an emergency situation that involves the risk
    of death or serious physical harm; or to providers of information or
    database management services solely for purposes of assisting in the
    delivery of emergency services in response to an emergency." 47
    U.S.C. § 222(d)(4). The carrier also may use or disclose, without
    express prior authorization, "automatic crash notification
    information" for use in "the operation of an automatic crash
    notification system." 47 U.S.C. § 222(f)(2). The Commission has
    sought comment on a petition filed by the Cellular
    Telecommunications and Internet Association (CTIA) requesting that
    we initiate a rulemaking proceeding to implement Section 222(f) by
    adopting CTIA's proposed location privacy principles. *Wireless
    Telecommunications Bureau Seeks Comment on Request to Commence
    Rulemaking to Establish Fair Location Information Practices*, WT
    Docket No. 01-72, Public Notice, DA 01-696 (rel. Mar. 16, 2001).

[^56]: *AT&T v. FCC*, No. 99-1413 (D.C. Cir., filed Oct. 8, 1999).

[^57]: *AT&T v. FCC*, No. 94-1413 (D.C. Cir., July 25, 2000).

[^58]: *See also AT&T v. Bell Atlantic Order* at para. 17.

[^59]: *CPNI Order*, 13 FCC Rcd at 8172, para. 154; *CPNI
    Reconsideration Order*, 14 FCC Rcd at 14481, para. 137.

[^60]: *CPNI Order*, 13 FCC Rcd at 8174, 8179, paras. 160, 169; *CPNI
    Reconsideration Order*, 14 FCC Rcd at 14480-81, para. 136.

[^61]: *CPNI Order*, 13 FCC Rcd at 8174, paras. 158-59.

[^62]: *CPNI Reconsideration Order*, 14 FCC Rcd at 14485, para. 142.

[^63]: *CPNI Order*, 13 FCC Rcd at 8175, para. 164.

[^64]: 47 C.F.R. §§ 1.1200 *et seq*.

[^65]: *See* 47 C.F.R. § 1.1206(b)(2), *as* *revised*.

[^66]: *See* 5 U.S.C. § 603(a).

[^67]: *See id.*

[^68]: 47 C.F.R. §§ 1.415, 1.419.

[^69]: *See Electronic Filing of Documents in Rulemaking Proceedings*,
    63 Fed. Reg. 24,121 (1998).

[^70]: *See* 47 C.F.R. § 1.49.

[^71]: 5 U.S.C. § 603. The RFA, *see* 5 U.S.C. § 601 *et seq*., has been
    amended by the Contract With America Advancement Act of 1996, Pub.
    L. No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of CWAAA is
    the Small Business Regulatory Enforcement Fairness Act of 1996
    (SBREFA).

[^72]: 47 U.S.C. § 222

[^73]: *Id*. at 1238-39.

[^74]: *Id.* at 1240, n. 15 ("The dissent accuses us of 'advocating' an
    opt-out approach. We do not 'advocate' any specific approach.").

[^75]: *See infra* paras. 14-23.

[^76]: *See infra* para. 9.

[^77]: *See infra* para. 21.

[^78]: *See infra* para. 21.

[^79]: 5 U.S.C. §§ 603(b)(3), 604(a)(3).

[^80]: 5 U.S.C. § 601(6).

[^81]: 5 U.S.C. § 601(3) (incorporating by reference the definition of
    "small business concern" in 5 U.S.C. § 632).

[^82]: 15 U.S.C. § 632.

[^83]: 13 C.F.R. § 121.201. The North American Industry Classification
    System (NAICS) has replaced the SIC system for describing types of
    industries. SIC 4812 corresponds to NAICS 513321, 513322, 51333
    (Radiotelephone Communications). SIC 4813 corresponds to NAICS
    51331, 51333, 51334 (Telephone Communications, Except
    Radiotelephone).

[^84]: 13 C.F.R. § 121.210 (SIC 4813).

[^85]: United States Department of Commerce, Bureau of the Census, *1992
    Census of transportation Communications and Utilities: Establishment
    and Firm Size*, at Firm Size 1-123 (1995) (*1992 Census*).

[^86]: 15 U.S.C. § 632(a)(1).

[^87]: *1992 Census*, at Firm Size 1-123.

[^88]: 13 C.F.R. § 121.201 (SIC 4813/NAICS 51331).

[^89]: 47 C.F.R. § 64.601 *et seq*.; *Carrier Locator: Interstate
    Service Providers*, FCC Common Carrier Bureau, Industry Analysis
    Division (rel. Oct. 2000) (*Carrier Locator*).

[^90]: *Carrier Locator* at Figure 1. The total for competitive LECs
    includes competitive access providers and competitive LECs.

[^91]: *Carrier Locator* at Figure 1.

[^92]: *Carrier Locator* at Figure 1.

[^93]: *Carrier Locator* at Figure 1.

[^94]: *Carrier Locator* at Figure 1.

[^95]: *1992 Census* at Firm Size 1-123.

[^96]: 13 C.F.R. § 121.201 (SIC 4812/NAICS 513322).

[^97]: *Carrier Locator* at Figure 1. The total for cellular carriers
    includes cellular, Personal Communications Service (PCS) and
    Specialized Mobile Radio (SMR) carriers.

[^98]: *See* *Amendment of Parts 20 and 24 of the Commission\'s Rules
    \-- Broadband PCS Competitive Bidding and the Commercial Mobile
    Radio Service Spectrum Cap*, Report and Order, FCC 96-278, WT Docket
    No. 96-59, paras. 57-60 (June 24, 1996), 61 FR 33859 (July 1, 1996);
    *see also* 47 C.F.R. § 24.720(b).

[^99]: *Id.* at para. 60.

[^100]: *Implementation of Section 309(j) of the Communications Act \--
    Competitive Bidding*, PP Docket No. 93-253, Fifth Report and Order,
    9 FCC Rcd 5532, 5581-84 (1994).

[^101]: *Carrier Locator* at Figure 1.

[^102]: 5 U.S.C. § 603(c).

[^103]: *CPNI Order*, 13 FCC Rcd at 8098-8100, paras. 49-50.

[^104]: *See CPNI Reconsideration Order*, 14 FCC Rcd at 14472-75, paras.
    125-27 (adjusting certain CPNI safeguards to ease the costs of
    compliance for small carriers).

[^105]: *See* *CPNI Reconsideration Order*, 14 FCC Rcd at 8142-43, 8146,
    8151, paras. 104, 109, 116.

[^106]: *CPNI Reconsideration Order*, 13 FCC Rcd at 14472-75, paras.
    124-27.

[^107]: *See supra* para. 19.

[^108]: 182 F.3d 1224 (10^th^ Cir. 1999) (*U.S. West*).

[^109]: 47 U.S.C § 222.

[^110]: Telecommunications carriers may also use, disclose, or permit
    access to CPNI "as required by law," and for other purposes that are
    not at the center of this FNPRM. *See* 47 U.S.C. § 222.

[^111]: *Implementation of the Telecommunications Act of 1996:
    Telecommunications Carriers' Use of Customer Proprietary Network
    Information and Other Customer Information and Implementation of the
    Non-Accounting Safeguards of Sections 271 and 272 of the
    Communications Act of 1934, as amended,* CC Docket Nos. 96-115 and
    96-149, Order and Further Notice of Proposed Rulemaking, 13 FCC Rcd
    8061, paras. 88-107 (1998) (*CPNI Order).*

[^112]: *Id.* at para. 93.

[^113]: *Id.* at para. 94.

[^114]: *U.S. West* at 1240 fn 15.

[^115]: *Id*. at 1235.

[^116]: *Id*. at 1234-37.

[^117]: *Id*. at 1237.

[^118]: *Id*. at 1238, quoting *Rubin v. Coors Brewing*, 514 U.S. 476,
    486 (1995).

[^119]: Telecommunications carriers may also use, disclose, or permit
    access to CPNI "as required by law," and for other purposes that are
    not at the center of this FNPRM. *See* 47 U.S.C. § 222.