`[Federal Register Volume 78, Number 8 (Friday, January 11, 2013)]
[Rules and Regulations]
[Pages 2572-2599]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-00278]



[[Page 2571]]

Vol. 78

Friday,

No. 8

January 11, 2013

Part IV





Federal Communications Commission





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47 CFR Part 69





Special Access for Price Cap Local Exchange Carriers; AT&T Corporation 
Petition for Rulemaking To Reform Regulation of Incumbent Local 
Exchange Carrier Rates for Interstate Special Access Services; Final 
Rule and Proposed Rule

  Federal Register / Vol. 78, No. 8 / Friday, January 11, 2013 / Rules 
and Regulations  

[[Page 2572]]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 69

[WC Docket No. 05-25; RM-10593; FCC 12-153]


Special Access for Price Cap Local Exchange Carriers; AT&T 
Corporation Petition for Rulemaking To Reform Regulation of Incumbent 
Local Exchange Carrier Rates for Interstate Special Access Services

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Commission continues the process of 
reviewing its special access rules to ensure that they reflect the 
state of competition today and promote competition, investment, and 
access to dedicated communications services businesses across the 
country rely on every day to deliver their products and services to 
American consumers. The Report and Order initiates a comprehensive data 
collection and specifies the nature of the data to be collected and the 
scope of respondents. An initial version of the data collection is 
attached to the Report and Order as an appendix; the Report and Order 
delegates authority to the Commission's Wireline Competition Bureau to 
review and modify the collection to implement the requirements of the 
Report and Order.

DATES: Effective March 12, 2013. The information collection and 
recordkeeping requirements contained in section III and appendix A of 
the document are not effective until they are approved by the Office of 
Management and Budget.

FOR FURTHER INFORMATION CONTACT: Jamie Susskind, Wireline Competition 
Bureau, Pricing Policy Division, (202) 418-1520 or (202) 418-0484 
(TTY), or via email at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order in WC Docket No. 05-25, RM-10593, FCC 12-153, adopted on 
December 11, 2012, and released on December 18, 2012. This summary 
should be read with its companion document, the Further Notice of 
Proposed Rulemaking (FNPRM) summary published elsewhere in this issue 
of the Federal Register. The summary is based on the public redacted 
version of the document, the full text of which is available 
electronically via the Electronic Comment Filing System at http://fjallfoss.fcc.gov/ecfs/ or may be downloaded at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-12-153A1.pdf. The full 
text of this document is also available for public inspection during 
regular business hours in the Commission's Reference Center, 445 12th 
Street SW., Room CY-A257, Washington, DC 20554. The complete text may 
be purchased from Best Copy and Printing, Inc., 445 12th Street SW., 
Room CY-B402, Washington, DC 20554. To request alternate formats for 
persons with disabilities (e.g. Braille, large print, electronic files, 
audio format, etc.) or reasonable accommodations for filing comments 
(e.g. accessible format documents, sign language interpreters, CARTS, 
etc.), send an email to [email protected] or call the Commission's 
Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice) or 
(202) 418-0432 (TTY).

I. Introduction

    1. In the Report and Order and Further Notice of Proposed 
Rulemaking, we continue the process of reviewing our special access 
rules to ensure that they reflect the state of competition today and 
promote competition, investment, and access to dedicated communications 
services businesses across the country rely on every day to deliver 
their products and services to American consumers. Specifically, we 
initiate a comprehensive data collection and seek comment on a proposal 
to use the data to evaluate competition in the market for special 
access services.

II. Background

A. Price Cap Regulation

    2. In 1991, the Commission implemented a system of price cap 
regulation by which the largest incumbent LECs (often referred to today 
as price cap LECs) establish their interstate access charges. Price cap 
regulation is a form of incentive regulation that seeks to ``harness 
the profit-making incentives common to all businesses to produce a set 
of outcomes that advance the public interest goals of just, reasonable, 
and nondiscriminatory rates, as well as a communications system that 
offers innovative, high quality services.'' In contrast to rate-of-
return regulation, which preceded price cap regulation and focuses on 
an incumbent LEC's costs and fixes the profits an incumbent LEC may 
earn based on those costs, price cap regulation focuses primarily on 
the prices that an incumbent LEC may charge. The access charges of 
price cap LECs originally were set at levels based on the rates that 
existed at the time the LECs entered the price cap regime. Increases in 
their rates have, however, been limited over the course of price cap 
regulation by the Price Cap Index (PCI) that is adjusted annually 
pursuant to formulae set forth in Part 61 of our rules.
    3. The PCI is designed to limit the prices LECs charge for service. 
The PCI has three basic components: (1) A measure of inflation, i.e., 
the Gross Domestic Product (chain weighted) Price Index (GDP-PI); (2) a 
productivity factor or ``X-Factor,'' which represents the amount by 
which LECs can be expected to outperform economy-wide productivity 
gains; and (3) adjustments to account for ``exogenous'' cost changes 
that are outside the LEC's control and not otherwise reflected in the 
PCI. The Commission's price cap formula permitted special access PCIs 
to increase by a measure of inflation, minus a productivity offset (the 
X-factor). The X-factor represented the amount by which LECs were 
expected to outperform economy-wide productivity gains.

B. Pricing Flexibility

    4. Pursuant to the pro-competitive, deregulatory mandates of the 
1996 Act, the Commission adopted the Pricing Flexibility Order in 1999 
to ensure that the Commission's regulations did not unduly interfere 
with the operation of interstate access markets as competition 
developed. In that Order, the Commission developed competitive showing 
rules (also referred to as ``triggers'') intended to measure whether 
market conditions in a given Metropolitan Statistical Area would 
warrant various levels of regulatory relief. To make a competitive 
showing, the Commission held that price cap LECs would need to 
demonstrate

either that (1) competitors unaffiliated with the incumbent LEC have 
established operational collocation arrangements in a certain 
percentage of the incumbent LEC's wire centers in an MSA, or (2) 
unaffiliated competitors have established operational collocation 
arrangements in wire centers accounting for a certain percentage of 
the incumbent LEC's revenues from the services in question in that 
MSA. In both cases, the incumbent also must show, with respect to 
each wire center, that at least one collocator is relying on 
transport facilities provided by a transport provider other than the 
incumbent LEC.

    5. Under the rules, the Commission granted relief in two phases. 
Phase I relief, which required lower levels of collocation, gave price 
cap LECs the ability to lower their rates through contract tariffs and 
volume and term

[[Page 2573]]

discounts, but required that they maintain their generally available 
price cap-constrained tariff rates to ``protect[ ] those customers that 
lack competitive alternatives.'' Phase II relief, which required higher 
levels of collocation, permitted price cap LECs to raise or lower their 
rates throughout an area, unconstrained by price cap regulations 
included in the Commission's part 61 and part 69 rules.

C. The CALLS Order

    6. In 2000, the Commission adopted the CALLS plan, a five-year 
interim, industry-proposed regime designed to move towards a more 
market-based approach to rate setting. The CALLS plan separated special 
access services into their own basket and applied a separate X-factor 
to that basket. The X-factor under the CALLS plan, unlike under prior 
price cap regimes, is not a productivity factor but ``a transitional 
mechanism * * * to lower rates for a specified time period for special 
access.'' The CALLS X-factor for special access was 3.0 percent in 
2000, and increased to 6.5 percent for 2001, 2002, and 2003. For the 
final year of the CALLS plan (July 1, 2004-June 30, 2005), the special 
access X-factor was set equal to inflation. As the Commission has yet 
to replace the interim CALLS plan X-factor, price cap LECs' special 
access rates have remained frozen at 2003 levels (excluding any 
necessary exogenous cost adjustments).

D. AT&T's Petition for Rulemaking and 2005 Special Access NPRM

    7. On October 15, 2002, AT&T Corp. filed a petition for rulemaking 
requesting that the Commission revoke the pricing flexibility rules and 
revisit the CALLS plan as it applies to special access services. AT&T 
contended both that the predictive judgment at the core of the Pricing 
Flexibility Order had not been confirmed by marketplace developments, 
and that BOC special access rates exceeded competitive levels and hence 
were unjust and unreasonable in violation of Sec.  201 of the 
Communications Act. Because the predictive judgment had proven wrong, 
AT&T asserted, the Commission was compelled to revisit its pricing 
flexibility rules in a rulemaking proceeding. Price cap LECs countered 
that, among other things, their special access rates were reasonable 
and therefore lawful, that there was robust competition for special 
access services, that the collocation-based competitive showings were 
an accurate metric for competition, and that data relied upon by AT&T 
were unreliable in the context used by AT&T.
    8. On January 31, 2005, the Commission released the Special Access 
NPRM, which initiated a broad examination of what regulatory framework 
to apply to price cap LECs' interstate special access services 
following the expiration of the CALLS plan, including whether to 
maintain or modify the Commission's pricing flexibility rules. 
Moreover, the NPRM sought to examine whether the available marketplace 
data supported maintaining, modifying, or repealing these rules. It 
also responded to AT&T's request for interim relief.

E. Recent Actions in the Proceeding

1. Competitive and Regulatory Developments
    9. Numerous regulatory and competitive developments affected the 
special access market in the years following the release of the Special 
Access NPRM. In July 2007, the Commission sought comment in the record 
in light of subsequent industry consolidation, a Government 
Accountability Office (GAO) report on special access competition, and 
other competitive developments. Moreover, as a result of a series of 
forbearance proceedings, the scope of services affected by the Special 
Access NPRM narrowed considerably.
2. Analytical Framework
    10. In November 2009, the Commission's Wireline Competition Bureau 
(Bureau) sought comment on the appropriate analytical framework for 
examining the issues that the Special Access NPRM raised. In July 2010, 
the Bureau held a staff workshop on the economics of special access to 
gather further input on the analytical framework issue.
3. Voluntary Data Requests
    11. In October 2010, the Bureau issued a public notice inviting the 
public to submit data on the presence of competitive special access 
facilities to assist the Commission in evaluating the issues that the 
Special Access NPRM raised. In September 2011, the Bureau issued a 
second public notice requesting the submission of competition and 
pricing data.
4. Pricing Flexibility Suspension Order
    12. On August 22, 2012, the Commission adopted an order that 
concluded that the special access pricing flexibility rules discussed 
above were not working as predicted and suspended the 90-day deadline 
for granting a petition for pricing flexibility based on those flawed 
rules.

III. Report and Order

    13. In the Report and Order, we require providers and purchasers of 
special access service and certain other services to submit data, 
information and documents to allow the Commission to conduct a 
comprehensive evaluation of competition in the special access market.

A. Scope

    14. In this section, we identify the scope of the data collection, 
the entities that must respond to the data collection, and the 
geographic areas and time periods for which they must respond.
    15. A preliminary note on terminology: For purposes of the Report 
and Order and consistent with Commission precedent, we do not include 
mass market Internet access services (e.g., DSL or cable modem service) 
in our definition of special access. We use the term ``location'' to 
mean a building, other man-made structure, a cell site on a building, a 
free-standing cell site, or a cell site on some other man-made 
structure where the end user is connected, but is not a ``node.'' We 
use the term ``node'' to mean an aggregation point, a branch point, or 
a point of interconnection on a provider's network, including a point 
of interconnection to other provider networks. ``End user'' means a 
business, institutional, or government entity that purchases dedicated 
service for its own purposes and does not resell such service. We use 
the term ``connection'' to mean a wired ``line'' or wireless 
``channel'' that provides a dedicated communication path between an end 
user's location and the first node on a provider's network. Examples 
include LEC central offices, remote terminal locations, splice points 
(including, for example, at manholes), controlled environmental vaults, 
cable system headends, cable modem termination system (CMTS) locations, 
and facility hubs. We use the terms ``bandwidth'' and ``capacity'' 
interchangeably.
    16. Services Covered. Traditionally, federal antitrust agencies 
have begun competitive analyses in a variety of contexts by defining 
relevant product and geographic markets. As noted in the Further 
Notice, however, these agencies have more recently noted that 
``analysis need not start with market definition * * * although 
evaluation of competitive alternatives available to customers is always 
necessary at some point in the analysis.'' In particular, ``[e]vidence 
of competitive effects can inform market definition, just as market

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definition can be informative regarding competitive effects.''
    17. Taking these considerations into account, we collect 
information on the full array of traditional special access services, 
including DS1s and DS3s, and packet-based dedicated services such as 
Ethernet. Further, although there is little disagreement in the record 
as to the definition of special access services, and that as 
traditionally defined they do not include mass market Internet access 
services, there is some question as to whether the relevant product 
market should encompass not only special access services but other 
high-capacity data services targeted at enterprise customers. Some 
commenters have argued that best efforts broadband Internet access 
services--even when marketed to small- to medium-sized business 
customers--are not part of the relevant product market. These 
commenters note, among other things, that prices for best efforts 
services differ substantially from special access services for 
comparable bandwidth. Others have argued that best efforts services are 
often marketed with express comparisons to special access services, and 
therefore the Commission should collect data on both.
    18. We need not resolve the market-definition issue here--for 
purposes of this data collection, we conclude it is best to simply take 
a broad approach. To ensure that we collect data on services that 
enterprise customers may view as substitutable, we define the scope of 
our data collection to include best efforts business broadband Internet 
access services, which we define as best efforts Internet access data 
services with a capacity equal to or greater than a DS1 connection that 
are marketed to enterprise customers (including small, medium, and 
large businesses, as well as existing special access customers). As 
described below, we structure the collection somewhat differently for 
best efforts and special access services to minimize the burden on 
submitters consistent with our data requirements and taking into 
consideration data that the Commission already has available to it.
    19. We also note that we intend to collect data on intrastate 
special access services and special access services offered via a 
state-level tariff or state-approved contract. Doing so is necessary to 
ensure that we have a clear picture of all competition in the 
marketplace.
    20. Providers and purchasers that must respond. In order to conduct 
a comprehensive analysis of the special access market, we will collect 
data from all providers and purchasers of special access services as 
well as some entities that provide best efforts business broadband 
Internet access services. By ``providers,'' we mean any entity subject 
to the Commission's jurisdiction under the Communications Act, as 
amended, that provides special access services or provides a connection 
that is capable of providing special access services. By 
``purchasers,'' we mean any entity subject to the Commission's 
jurisdiction under the Communications Act, as amended, that purchases 
special access services.
    21. To clarify our terminology, we note that some providers are 
``competitive providers,'' by which we mean a competitive local 
exchange carrier (CLEC), interexchange carrier, cable operator, 
wireless provider or any other provider that is not an incumbent LEC 
operating within its incumbent service territory. We also note that a 
rate-of-return carrier, which is not subject to our pricing flexibility 
rules, shall not be considered a ``provider'' to the extent it provides 
special access within its rate-of-return service area. This exemption 
does not apply to services not regulated on a rate-of-return basis or 
provided outside a rate-of-return carrier's service area by itself or 
an affiliate.
    22. We note concerns regarding the burden that this data collection 
will impose on small companies, and are mindful of the importance of 
seeking to reduce information collection burdens for small business 
concerns, and in particular those ``with fewer than 25 employees.'' Any 
effort to lessen the burdens of this information collection on small 
companies must be balanced against our goal of obtaining the most 
accurate and useful data possible. Competition in the provision of 
special access appears to occur at a very granular level--perhaps as 
low as the building/tower. A provider that owns 50 of its own channel 
terminations to end users may not be competitively significant within 
an area as large as an MSA, but could be a significant competitor 
within smaller areas, such as zip code areas. Therefore, we believe it 
necessary to obtain data from special access providers and purchasers 
of all sizes, but we shall not require entities with fewer than 15,000 
customers and fewer than 1,500 business broadband customers to provide 
data regarding their best efforts business broadband Internet access 
services. As some commenters have urged us to do, this approach will 
incorporate data and information from nascent technologies, such as 
WISPs.
    23. Geographic scope. With some exceptions, we will collect data on 
a nationwide basis to ensure the most comprehensive and accurate 
assessment of competition in markets for special access services 
subject to our pricing flexibility rules. Because the focus of this 
proceeding is on the regulation of special access services in price-cap 
territories, we will not require data from any provider with regard to 
its operations in any geographic area in which a rate-of-return carrier 
is the incumbent, as such carriers are not subject to the pricing 
flexibility rules. Moreover, we will not require a purchaser to produce 
data based on purchases it makes in those areas in which a rate-of-
return carrier is the incumbent. If, however, a provider or purchaser 
prefers to provide data for all areas without distinguishing between 
areas served by price cap LECs and rate-of-return LECs, it may do so.
    24. We considered whether we could reduce the burden of this data 
collection by collecting all of our data from a sample of locations 
(e.g., business locations and wireless towers) and/or larger geographic 
areas. However, we decline to adopt a sampling approach because we 
believe that the process of identifying and collecting a representative 
sample would be unlikely to substantially reduce provider burdens, and 
could significantly lengthen the data collection process. With respect 
to a sample of geographic regions, it is very difficult to design a 
representative sample without coming close to covering the entire 
country--a fact that minimizes the likelihood that a geographic sample 
would actually reduce the burden on respondents. Further, respondents 
likely would be required to search multiple databases and compare the 
results of those searches to determine which of their customer 
locations were in the selected geographies, resulting in substantial 
setup costs. Finally, even where a respondent need only consult a 
single database, it typically would have to engage in essentially the 
same, or greater (to account for the geographic sample), amount of 
coding to ``pull'' a sample of records as it would if it pulled all 
records.
    25. A methodology based on sampling specific locations suffers from 
the same database and coding issues as geographic sampling, and further 
would likely lengthen the data collection process by a significant 
margin. Although the most recent data we have are several years old, 
they suggest that competitive providers may serve a relatively small 
proportion of all locations that have special access. As a result, a 
random sample from all locations would need to be very large--

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perhaps approaching a census--to obtain sufficient data on competitive 
providers. Alternatively, we could require all respondents to identify 
all the relevant locations so that a smaller sample could be drawn from 
that census in a scientific way. That approach likely would lengthen 
the data collection process because it would require two collections to 
be conducted sequentially: First a census of served locations from 
which a sample could be drawn, and then a subsequent issuing of 
questions about locations in the sample. It would also fail to 
significantly reduce the overall burden for several reasons. First, the 
burden of producing the census would be similar to, though perhaps 
lower than, the burden of producing the information identified above. 
Second, because of the need to tie sampled locations to the relevant 
databases, the effort to respond to questions about a sample of 
locations would, for many respondents, raise, or at least not reduce, 
their burden. Third, while the costs in burden saved through sampling 
are likely to be relatively small, the statistical error of any 
conclusions based on a sample could be significantly higher than 
conclusions based on a census.
    26. We do choose to sample for the narrower purpose of seeking to 
understand the evolution of competitive provider buildout of a 
connection to a specific end user's location. Such an analysis requires 
facilities deployment data over a long period of time, which would be 
burdensome for many providers to produce for their entire networks. By 
collecting this data in a representative sample of geographic areas, it 
is possible to minimize the burden on providers while providing 
accurate and useful data on this narrow aspect of providers' behavior. 
The decision to sample for this narrow purpose does not suffer from the 
same issues discussed above. First, the sample can be significantly 
smaller than would be necessary for a more general analysis. Second, 
the sample will be drawn from the universe of locations identified in 
the course of the larger data collection; this sequential collection is 
unlikely to materially impact our ability to undertake the proposed 
analysis. Finally, the information to be produced from the sample is 
limited to facilities deployment data.
    27. Temporal scope. We will collect the majority of the data for 
calendar years 2010 and 2012. We find that collecting data on these 
issues for two calendar years appropriately balances the need for time 
series data with the burden of producing data for multiple years. We 
choose calendar year 2012 because it is the most recent calendar year 
for which data will be available once Paperwork Reduction Act approval 
is obtained for the information collection adopted in this order. And 
by collecting 2012 data, the Commission will obtain the most up-to-date 
data available while still providing respondents a reasonable time to 
gather and submit their data. We choose calendar year 2010 because, 
while we recognize that it likely is more burdensome to produce 2010 
data than 2011 data, a two year period between observations is more 
likely to include changes in the relevant variables than a one year 
period. We also recognize that our second voluntary data request sought 
data for 2010, which will mean those providers who responded to that 
request will be able to rely on their past efforts in responding to 
some elements of this collection.
    28. We will collect two years' worth of data for market structure, 
price, and demand (i.e., observed sales and purchases). This allows for 
an analysis that controls for factors that may vary widely across 
geographic areas, but not within a given geographic area (e.g., entry 
factors such as building codes or soil quality). For example, if we 
observe differences in deployment between different geographies, these 
may be due to differences in factors such as building codes, climate, 
or soil quality. Controlling for these can be challenging. However, 
these kinds of variables do not typically change significantly over a 
few years. In contrast, observing differences in deployment that emerge 
over a few years within the same geographic region permits an analysis 
that controls for such factors. Conversely, if we have only one year's 
worth of data, we will be less able to associate particular factors 
with levels of deployment.
    29. Most importantly, collecting a time series of data will help us 
assess potential competition. One way to assess potential competition 
is by obtaining structural, pricing, and demand data over a two-year 
period to observe and better understand how and why competition has 
evolved over time and, therefore, where potential competition exists. 
Our proposal to collect historical data, which could be used to predict 
potential competition, is consistent with Commission precedent, as well 
as that of the U.S. antitrust agencies.

B. Nature of Data To Be Collected

    30. The data, information, and documents required to conduct a 
robust analysis of special access competition fall into five general 
categories: Market structure, pricing, demand (i.e., observed sales and 
purchases), terms and conditions, and competition and pricing 
decisions. In this section, we describe the nature of the data to be 
collected. Further, we include in Appendix C an initial version of the 
data collection that incorporates the data, information, and documents 
we describe below. We direct the Bureau to review and modify this 
collection, consistent with the authority delegated in section III.D 
below, to implement the requirements of this Report and Order.
    31. Market structure data. We intend to assess the market structure 
for special access market(s). By this, we mean that we intend to 
examine comprehensive data on the situs and type of facilities capable 
of providing special access, by sold and potential capacity and 
ownership, and the proximity of such facilities to sources of demand. 
Specifically, we require each provider to submit data and information 
for connections that are owned by the provider, leased under an 
indefeasible right of use (IRU), or, for competitive providers, 
obtained from an incumbent LEC as an unbundled network element (UNE) to 
provide a dedicated service, including, but not limited to:
     Locations to which the provider has sold a connection to 
an end user or a provider;
     Information on the nature of the location and the nature 
of the connection serving that location, including:
    [cir] The situs of the location and whether the location is a 
building, other free-standing site, cell site on a building, or free-
standing cell site;
    [cir] Whether the connection is fiber, wireless (and if wireless, 
the provisioned bandwidth of the channel), or some other medium; and
    [cir] The provisioned bandwidth of each type of connection.
    32. We require incumbent LEC providers to submit data concerning 
the number, nature, and situs of UNEs sold.
    33. We require competitive providers to submit detailed information 
related to non-price factors that may impact where special access 
providers build facilities or expand their network via UNEs. For 
example, providers may choose to expand their facilities in areas where 
they have already made significant facilities investments, like near 
their headquarters or a point of interconnection, to take advantage of 
cost efficiencies. We therefore require respondents to provide detailed 
information about such non-price factors. In addition, we require 
competitive providers to provide us with any business rules they use to

[[Page 2576]]

determine whether to build a connection to a location.
    34. In addition, we require competitive providers to submit the 
history of their facilities deployment in a sample of locations served 
by a competitive provider. Each competitive provider will report the 
date on which it provided a connection to each of its locations within 
the sample and locations proximate to the locations in the sample, 
including when and where it relied upon UNEs to establish a connection. 
The locations selected will include areas in which no pricing 
flexibility has been granted, as well as Phase I and/or Phase II 
pricing flexibility areas. These detailed data on the evolution of 
competitive provider networks will help us understand how competitive 
facilities are deployed over time and whether the presence of 
competitive facilities in fact provides a threat of competitive entry 
in nearby or adjacent areas.
    35. We require competitive providers to provide detailed 
collocation situs information. We also require competitive providers to 
submit maps of the routes followed by fiber that they own or lease 
subject to an IRU, of nodes that interconnect with third party 
networks, and of connections from their networks to locations. These 
maps will indicate where competitive providers can provide, or could 
potentially provide, special access services. Among other things, such 
maps will identify points of interconnection between competitive 
providers of special access services and incumbent LEC facilities.
    36. Price data. We require price data to characterize competition 
in the market for special access services. Such data will allow 
comparisons of different providers' prices, after controlling, where 
necessary, for differences in cost-causing factors, and can allow the 
consideration of the effect of market structure on price. Price data 
include, but are not limited to:
     The quantities sold and prices charged for special access 
services, by circuit element;
    [cir] As reflected in billing data;
    [cir] Including, where applicable and necessary, but not limited 
to, identifiers for the nature of the service, such as:
    [ssquf] Universal Service Order Code (USOC) or comparable code;
    [ssquf] Circuit and/or mileage end-points;
    [ssquf] Quantities relevant for billing (such as bandwidth and 
mileage);
    [ssquf] Term, volume, or revenue commitments relevant to billing; 
and
    [ssquf] Adjustments, rebates, or true-ups provided or received over 
time.

The Bureau collected similar data on a voluntary basis in the Special 
Access Facilities Data Public Notice.
    37. To understand this pricing information, we must also take into 
account the regulatory environment. For competitive providers, we 
already know the regulatory environment--they are unregulated with 
respect to price at the federal level. In contrast, the Commission 
regulates the prices incumbent LECs charge through a variety of 
methods: rate-of-return regulation, price-cap regulation, and Phases I 
and II of pricing flexibility. We therefore require incumbent LECs to 
list the form of price regulation that applies to their interstate 
special access services on a wire-center-by-wire-center basis.
    38. Demand data (i.e., observed sales and purchases). Demand data 
are a key input into any statistical analysis of how price varies with 
competition. Competitors generally are attracted to areas of high 
demand density because such areas provide opportunities to enjoy 
economies of scale and scope. Consequently, an understanding of the 
relationship between prices for observed sales and purchases and 
competitive entry will facilitate an assessment of market power. In 
addition, the record indicates that competition in the provision of 
special access appears to occur at a very granular level--perhaps as 
low as the building/tower or a floor of a building. We therefore need 
to understand observed sales or purchases of special access at the most 
granular level possible, because, among other things, sold or purchased 
volumes and volume density are a key driver of special access costs and 
an important determinant of the likelihood of potential entry. We 
therefore will collect, including but not limited to, data that 
identify:
     The bandwidth of the special access services sold or 
purchased;
     The location(s) being served;
     The nature of the demand (e.g., provider, end user, 
other);
     The locations of mobile wireless providers' cell sites and 
connections to those cell sites;
     Total expenditures on special access services by 
purchasers; and
     Revenues earned from the sales of special access.
    39. Terms and conditions data and information. The record reflects 
questions about whether the terms and conditions associated with the 
sale of special access services may inhibit a buyer's ability to switch 
to other providers, which in turn may inhibit facilities-based entry 
into special access markets. We therefore will collect, from providers 
and purchasers of special access services, data and information that 
includes but is not limited to:
     Generally available plans for tariffed special access 
services that offer discounts, circuit portability, or other 
competitively relevant benefits;
     The business rationale for those plans;
     The extent of special access sales and purchases made that 
are and are not subject to discounts, circuit portability, or other 
benefits;
     How such plans work with each other, and in conjunction 
with contract-based tariffs and other forms of contracts that govern 
the sale and pricing of special access services;
     Customer information associated with such plans and 
contract-based tariffs (e.g., the number of customers subscribed to an 
individual plan or contract-based tariff);
     How discounts, circuit portability, and other 
competitively relevant benefits for sales of special access services by 
competitive providers differ from those of the incumbent LEC providers;
     Contract-based tariffs;
     Provider policies and internal procedures governing 
deployment, disconnection, upgrades, and switching providers;
     The impact certain terms and conditions may have on a 
purchaser's ability to reduce purchases from its existing provider, 
switch providers, or purchase unregulated services;
     Generally available tariffs, contract-based tariffs, and 
other forms of contracts that govern the sale and pricing of special 
access services and services that are sold (or priced) in connection 
with special access services; and
     A description of the customers targeted by providers 
(e.g., size, geographic scope, type) and the promotional and 
advertising strategies for winning or retaining such customers.
    40. Competition and pricing decision data, information and 
documents. We require providers of special access to submit data, 
information and/or documents related to competition and pricing 
decisions for special access services, including selected competitive 
provider responses to Requests for Proposals (RFPs).
    41. Specifically, we require each competitive provider to identify 
the five most recent RFPs for which it was selected as the winning 
bidder to provide each of the following: (i) Best effort business 
broadband Internet access services, (ii) special access services, and, 
to the extent different from (i) or (ii), and (iii) some other form of 
high-capacity data services to

[[Page 2577]]

business customers. We also require each competitive provider to 
identify the five largest (by number of connections) RFPs for which it 
submitted an unsuccessful competitive bid between 2010 and 2012 for 
each of (i) best effort business broadband Internet access services, 
(ii) special access services, and, to the extent different from (i) or 
(ii), and (iii) some other form of high-capacity data services to 
business customers. For each RFP identified, the competitive provider 
shall provide a description of the RFP, the area covered, the price 
offered, as well as other competitively relevant information regarding 
RFPs specified by the Bureau.
    42. Parties contend that advertising and marketing relating to 
special access, regardless of whether a competitive provider has 
actually built out facilities to a particular location, may impact 
pricing and deployment decisions. Accordingly, we require competitive 
providers of special access to submit data, maps, information, 
marketing materials, and/or documents identifying those geographic 
areas where they advertised or marketed special access services over 
existing facilities, via leased facilities, or by building out new 
facilities as of December 31, 2010 and December 31, 2012, or planned to 
advertise or market such services within twenty four months following 
those dates.
    43. Another useful category of information may be documents showing 
the internal analyses undertaken by providers in 2010 or thereafter to 
evaluate, inter alia, competitive market shares, changes in 
competition, changes in the costs of supplying services, whether to 
respond to RFPs, and identified rate increases and decreases. We 
decline at this time to require all providers to submit that 
information given the burden of identifying and producing such 
documents. Instead, we shall take a two-stage approach with these 
internal documents. Specifically, we delegate authority to the Bureau 
to require a provider to submit such documents if the Bureau finds in 
an order that (a) a provider's responses to the business-rules 
questions are incomplete or insufficient for analysis, (b) a 
competitive provider's responses to the history-of-deployment questions 
are incomplete or insufficient for analysis, or (c) the data collected 
for a particular geographic area are incomplete or insufficient for 
analysis.
    44. Best Efforts Business Broadband Internet Access Services. As 
noted above, we define the scope of our data collection to include best 
efforts business broadband Internet access services. Because the record 
indicates that entities that provide best efforts business broadband 
Internet access services generally deliver those services throughout 
their footprint over the same network facilities they use to deliver 
mass market broadband Internet access, we need not collect this data at 
the same level of granularity as location and facilities data for 
special access. Data showing whether an entity is providing best 
efforts business broadband Internet access service at, for example, the 
census block level would not diminish the rigor of our analysis, but 
would significantly reduce the burden of producing the necessary data. 
Indeed, many entities already submit data in connection with the State 
Broadband Initiative (SBI) Grant Program as to where they offer best 
efforts broadband Internet access services at the census block level.
    45. Further, we already have information on enterprise 
subscriptions to broadband Internet access services through our Form 
477 collection. In their biannual Form 477 filings, facilities-based 
providers of fixed-location Internet access connections (which include 
providers equipping UNEs, special access lines, or other leased 
facilities) submit information, by census tract (areas roughly the size 
of zip codes), on all Internet access connections (greater than 200 
kbps) to end users, including businesses. They also identify the 
percentage of connections within each census tract that is residential.
    46. We therefore require, subject to the exception set forth in 
paragraph 22 above, entities that submitted data in connection with the 
SBI Grant Program and offer best efforts business broadband Internet 
access services to identify, on a granular but not location-by-location 
basis (ideally, at the census block level), the geographic areas in 
which they offer those services. The Bureau may accept such entities' 
certification that the data they have submitted in connection with the 
SBI Grant Program accurately and completely identify the areas in which 
they offer best efforts business broadband Internet access services and 
exclude those areas where they do not offer such services. We further 
require such entities to submit a price list for the best efforts 
business broadband Internet access services that they offered within 
their footprint. Such price list should identify the list prices for 
the best efforts business broadband Internet access services they 
offered, whether there was any price variation within their service 
footprint, and, if so, the nature of such variation. This information, 
taken together with the Form 477 data and the data we will collect on 
UNEs that could be used to provide these services, will allow us to 
analyze of the availability of, demand for, and pricing of best efforts 
business broadband Internet access services.
    47. Additional Data Not Collected. We recognize that the collection 
we adopt today does not include every type of data that is available. 
Commenters suggest we ask for a broad array of competition data and 
information. Others have recommended obtaining information about 
providers' past lateral construction projects, future upgrade or 
expansion plans and additional information on competitive bidding. We 
agree that some such information may be qualitatively useful, and, for 
example, have required the production of data on competitive provider 
RFP responses and future plans to inform our analysis. We must, 
however, balance the administrative burdens with the potential benefits 
of a broader collection, and believe that this Report and Order will 
allow us to collect data and information sufficient for our purposes 
while minimizing, to the extent possible, the burden we impose on 
industry.
    48. Further, we agree with commenters who argue that to understand 
the impact of competition in special access, it is important to grasp 
the effects of potential, as well as actual, competition. To this end 
we are requiring the production of information that will illuminate 
those factors that affect providers' decisions to expand existing 
networks, e.g., the non-price factors that may impact where special 
access providers build new facilities, business rules for deployment, a 
sample of historical deployment, points of collocation, fiber network 
maps, availability and use of UNEs, internal analysis of pricing 
decisions, a selected set of responses to RFPs, and internal 
competitive analysis.

C. Statutory Authority

    49. Several provisions of the Communications Act and the 
Telecommunications Act give the Commission authority to adopt this data 
collection. Under section 218 of the Communications Act, we may 
``obtain from [common] carriers and from persons directly or indirectly 
controlling or controlled by, or under direct or indirect common 
control with, such carriers full and complete information necessary to 
enable the Commission to perform the duties and carry out the objects 
for which it was created.'' As such, section 218 empowers us to collect 
data from

[[Page 2578]]

incumbent LECs, competitive LECs, CMRS providers, and other common 
carriers whether they provide or purchase special access service or 
other relevant services.
    50. Section 201 requires that interstate special access service 
rates, terms, and conditions be just and reasonable, section 202 
prohibits unjust or unreasonable discrimination in the provision of 
interstate special access services, and section 706 of the 
Telecommunications Act requires that we ``encourage the deployment of 
advanced telecommunications capability * * * by utilizing, in a manner 
consistent with the public interest, convenience, and necessity, price 
cap regulation, regulatory forbearance, measures that promote 
competition in the local telecommunications market, or other regulating 
methods that remove barriers to infrastructure investment.'' The 
Communications Act in turn provides us authority to carry out these 
duties--all of which will be aided by today's data collection--in 
section 4(i), which empowers the Commission to ``perform any and all 
acts * * * and issue such orders * * * as may be necessary in the 
execution of [our] functions,'' and section 201(b), which authorizes 
the Commission to ``prescribe such rules and regulations as may be 
necessary in the public interest to carry out the provisions'' of the 
Communications Act. These authorities, along with our subject matter 
jurisdiction over ``interstate and foreign commerce in communication by 
wire and radio,'' allow us to extend the data collection beyond common 
carriers to include other market participants that provide interstate 
communication by wire or radio. We note that there is widespread accord 
in the record on the Commission's authority to require the collection 
of the data and information it needs to inform our future actions.
    51. We note that parties have had extensive notice and opportunity 
to comment on the need for and scope of this data collection. In the 
2005 Special Access NPRM, the Commission sought comment regarding 
evidence of marketplace competitiveness and pricing for special access 
services, including the data and information to perform those analyses. 
In a subsequent Public Notice, the Commission sought additional data 
and to otherwise refresh the record of the Special Access NPRM in light 
of subsequent developments, including the release of a GAO report that, 
among other things, contended that the Commission needed additional 
data to evaluate the special access marketplace. In the resulting 
record of the proceeding, various parties advocated that the Commission 
undertake a data collection to obtain the data necessary to 
appropriately perform these analyses. Citing such filings, the Bureau 
sought comment on an analytical framework necessary to resolve the 
issues raised in the Special Access NPRM, including whether the record 
contained sufficient information to perform such analyses and, if not, 
what additional data the Commission should collect, and from whom. Most 
recently, in the Special Access Pricing Flexibility Suspension Order, 
the Commission stated that a data collection order would be 
forthcoming. In short, we have provided notice regarding this 
comprehensive data collection that has given ample opportunity for 
public participation and met any requirements of the Administrative 
Procedure Act.

D. Role of the Wireline Competition Bureau

    52. The data collection we adopt today is set forth in Appendix A 
of the Report and Order. Given the complexities associated with 
ensuring that the specific questions asked meet the Commission's needs 
as expressed in this Report and Order, navigating the Paperwork 
Reduction Act process, and actually collecting, cleaning, and analyzing 
the data, we delegate limited authority to the Bureau to: (a) Draft 
instructions to the data collection and modify the data collection 
based on public feedback; (b) amend the data collection based on 
feedback received through the PRA process; (c) make corrections to the 
data collection to ensure it reflects the Commission's needs as 
expressed in this Report and Order; and (d) issue Bureau-level orders 
and Public Notices specifying the production of specific types of data, 
specifying a collection mechanism (including necessary forms or 
formats), and setting deadlines for response to ensure that data 
collections are complied with in a timely manner, and (e) take other 
such actions as are necessary to implement this Report and Order. All 
such actions must be consistent with the terms of the Report and Order.
    53. Our goal is to ensure a comprehensive and detailed data 
collection. Accordingly, we direct the Bureau to engage in outreach 
with the provider and purchaser communities to ensure that all 
providers and purchasers are aware of this comprehensive data 
collection and the penalties for non-response. We encourage the Bureau 
to reach out to trade associations that represent small providers to 
inform them of their obligations to participate in the data collection 
effort and to ensure that we have maximum participation. In addition, 
to reduce the burden of this data collection, we direct the Bureau to 
facilitate whenever possible the conversion of street addresses to 
geocoded coordinates for small providers and purchasers.

E. Data Retention

    54. Respondents are required to retain any data, documents, 
documentation, or other information prepared for, or in connection 
with, their responses to these data reporting requirements for a period 
of three years or until the Commission issues a notice relieving 
respondents of this retention requirement upon the exhaustion of any 
appeals of a final order adopted in this proceeding.

F. Penalties for False Statements and Non-Response

    55. Respondents are required to certify that all statements of 
fact, data and information submitted to the Commission are true and 
correct to the best of their knowledge. False statements or 
misrepresentations to the Commission may be punishable by fine or 
imprisonment under Title 18 of the U.S. Code. Respondents are reminded 
that failure to comply with these data reporting requirements may 
subject them to monetary forfeitures of up to $150,000 for each 
violation or each day of a continuing violation, up to a maximum of 
$1,500,000 for any single act or failure to act that is a continuing 
violation.

IV. Procedural Matters

A. Paperwork Reduction Act Analysis

    56. This document contains a new information collection requirement 
subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-
13. It will be submitted to the Office of Management and Budget (OMB) 
for review under section 3507 of the PRA, 44 U.S.C. 3507. Prior to 
submission to OMB, the Commission will publish a notice in the Federal 
Register seeking public comment on the information collection 
requirement. In addition, that notice will also seek comment on how the 
Commission might ``further reduce the information collection burden for 
small business concerns with fewer than 25 employees'' pursuant to the 
Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 
U.S.C. 3506(c)(4). The information collection contained in this Report 
and Order will not go into effect until OMB approves the collection and 
the Commission has published a notice in the Federal

[[Page 2579]]

Register announcing the effective date of the information collection.

B. Congressional Review Act

    57. The Commission will send a copy of this Report and Order and 
Further Notice of Proposed Rulemaking to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act. See 5 
U.S.C. 801(a)(1)(A).

C. Final Regulatory Flexibility Analysis

    58. The Regulatory Flexibility Act (RFA) requires that an agency 
prepare a regulatory flexibility analysis for notice and comment 
rulemakings, unless the agency certifies that ``the rule will not, if 
promulgated, have a significant economic impact on a substantial number 
of small entities.'' Accordingly, we have prepared a Final Regulatory 
Flexibility Analysis concerning the possible impact of the Report and 
Order on small entities.
    59. As required by the Regulatory Flexibility Act of 1980 (RFA), as 
amended, Initial Regulatory Flexibility analyses (IRFAs) were 
incorporated in the Special Access NPRM for this proceeding. The 
Commission sought written public comment on the proposals in the 
Special Access NPRM, including comment on the IRFA. Comments received 
are discussed below. This present Final Regulatory Flexibility Analysis 
(FRFA) conforms to the RFA.
1. Need for, and Objectives of, the Order
    60. In 2005, the Commission initiated this proceeding as a broad 
examination of what regulatory framework to apply to price cap local 
exchange carriers' (LECs) interstate special access services following 
the expiration of the CALLS plan, including whether to maintain or 
modify the Commission's pricing flexibility rules. Moreover, the NPRM 
sought to examine whether the available marketplace data supported 
maintaining, modifying, or repealing these rules. In the Report and 
Order, the Commission continues the process of reviewing our special 
access rules to ensure that they reflect the state of competition today 
and promote competition, investment, and access to dedicated 
communications services businesses across the country rely on every day 
to deliver their products and services to American consumers. 
Specifically, the Commission initiates a comprehensive data collection 
and seek comment on a proposal to use the data to evaluate competition 
in the market for special access services.
    61. In the Report and Order, we require providers and purchasers of 
special access service and certain other services--including best 
efforts business broadband Internet access services-- as well as 
entities that provide certain other services, to submit data, 
information and documents to allow the Commission to conduct a 
comprehensive evaluation of competition in the special access market. 
The data, information, and documents required fall into five general 
categories: market structure; pricing; demand (i.e., observed sales and 
purchases), terms and conditions; and competition and pricing 
decisions. We will collect the majority of the data for calendar years 
2010 and 2012.
2. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA
    62. The Office of Advocacy of the U.S. Small Business 
Administration (SBA) filed reply comments to the Notice of Proposed 
Rulemaking and the Initial Regulatory Flexibility Act Analysis (IRFA). 
The SBA asserts that the Commission's IRFA did not consider the effect 
of new special access rules on small competitive carriers and urged the 
Commission to do so. SBA contended that because the Commission's 2005 
Triennial Review Remand Order (TRRO) required both large and small 
competitive carriers to purchase special access services instead of 
UNEs in many metropolitan markets, the Commission should consider the 
impact that changes in special access prices would have on small 
competitive carriers. SBA suggested a number of potential alternatives 
to special access pricing regulation that it asserted might minimize 
the impact on small competitive carriers. No other comments were filed 
in response to the IRFA.
3. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules Will Apply
    63. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small-business concern'' under the Small Business 
Act. A ``small-business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the SBA.
    64. Small Businesses. Nationwide, there are a total of 
approximately 27.5 million small businesses, according to the SBA.
    65. Wired Telecommunications Carriers. The SBA has developed a 
small business size standard for Wired Telecommunications Carriers, 
which consists of all such companies having 1,500 or fewer employees. 
According to Census Bureau data for 2007, there were 3,188 firms in 
this category, total, that operated for the entire year. Of this total, 
3,144 firms had employment of 999 or fewer employees, and 44 firms had 
employment of 1,000 employees or more. Thus, under this size standard, 
the majority of firms can be considered small.
    66. Local Exchange Carriers (LECs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to local exchange services. The closest applicable size 
standard under SBA rules is for Wired Telecommunications Carriers. 
Under that size standard, such a business is small if it has 1,500 or 
fewer employees. According to Commission data, 1,307 carriers reported 
that they were incumbent local exchange service providers. Of these 
1,307 carriers, an estimated 1,006 have 1,500 or fewer employees and 
301 have more than 1,500 employees. Consequently, the Commission 
estimates that most providers of local exchange service are small 
entities that may be affected by the rules and policies proposed in the 
Order.
    67. Incumbent Local Exchange Carriers (incumbent LECs). Neither the 
Commission nor the SBA has developed a size standard for small 
businesses specifically applicable to incumbent local exchange 
services. The closest applicable size standard under SBA rules is for 
Wired Telecommunications Carriers. Under that size standard, such a 
business is small if it has 1,500 or fewer employees. According to 
Commission data, 1,307 carriers reported that they were incumbent local 
exchange service providers. Of these 1,307 carriers, an estimated 1,006 
have 1,500 or fewer employees and 301 have more than 1,500 employees. 
Consequently, the Commission estimates that most providers of incumbent 
local exchange service are small businesses that may be affected by 
rules adopted pursuant to the Order.
    68. We have included small incumbent LECs in this present RFA 
analysis. As noted above, a ``small business'' under the RFA is one 
that, inter alia, meets the pertinent small business size standard 
(e.g., a telephone communications business having 1,500

[[Page 2580]]

or fewer employees), and ``is not dominant in its field of operation.'' 
The SBA's Office of Advocacy contends that, for RFA purposes, small 
incumbent LECs are not dominant in their field of operation because any 
such dominance is not ``national'' in scope. We have therefore included 
small incumbent LECs in this RFA analysis, although we emphasize that 
this RFA action has no effect on Commission analyses and determinations 
in other, non-RFA contexts.
    69. Competitive Local Exchange Carriers (competitive LECs), 
Competitive Access Providers (CAPs), Shared-Tenant Service Providers, 
and Other Local Service Providers. Neither the Commission nor the SBA 
has developed a small business size standard specifically for these 
service providers. The appropriate size standard under SBA rules is for 
the category Wired Telecommunications Carriers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 1,442 carriers reported that they were 
engaged in the provision of either competitive local exchange services 
or competitive access provider services. Of these 1,442 carriers, an 
estimated 1,256 have 1,500 or fewer employees and 186 have more than 
1,500 employees. In addition, 17 carriers have reported that they are 
Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 
or fewer employees. In addition, 72 carriers have reported that they 
are Other Local Service Providers. Of the 72, seventy have 1,500 or 
fewer employees and two have more than 1,500 employees. Consequently, 
the Commission estimates that most providers of competitive local 
exchange service, competitive access providers, Shared-Tenant Service 
Providers, and Other Local Service Providers are small entities that 
may be affected by rules adopted pursuant to the Order.
    70. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to interexchange services. The closest applicable size 
standard under SBA rules is for Wired Telecommunications Carriers. 
Under that size standard, such a business is small if it has 1,500 or 
fewer employees. According to Commission data, 359 companies reported 
that their primary telecommunications service activity was the 
provision of interexchange services. Of these 359 companies, an 
estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
interexchange service providers are small entities that may be affected 
by rules adopted pursuant to the Order.
    71. Prepaid Calling Card Providers. Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
prepaid calling card providers. The appropriate size standard under SBA 
rules is for the category Telecommunications Resellers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 193 carriers have reported that they are 
engaged in the provision of prepaid calling cards. Of these, an 
estimated all 193 have 1,500 or fewer employees and none have more than 
1,500 employees. Consequently, the Commission estimates that the 
majority of prepaid calling card providers are small entities that may 
be affected by rules adopted pursuant to the Order.
    72. Local Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 213 carriers have reported 
that they are engaged in the provision of local resale services. Of 
these, an estimated 211 have 1,500 or fewer employees and two have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of local resellers are small entities that may be affected by 
rules adopted pursuant to the Order.
    73. Toll Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 881 carriers have reported 
that they are engaged in the provision of toll resale services. Of 
these, an estimated 857 have 1,500 or fewer employees and 24 have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of toll resellers are small entities that may be affected by 
rules adopted pursuant to the Order.
    74. Other Toll Carriers. Neither the Commission nor the SBA has 
developed a size standard for small businesses specifically applicable 
to Other Toll Carriers. This category includes toll carriers that do 
not fall within the categories of interexchange carriers, operator 
service providers, prepaid calling card providers, satellite service 
carriers, or toll resellers. The closest applicable size standard under 
SBA rules is for Wired Telecommunications Carriers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 284 companies reported that their primary 
telecommunications service activity was the provision of other toll 
carriage. Of these, an estimated 279 have 1,500 or fewer employees and 
five have more than 1,500 employees. Consequently, the Commission 
estimates that most Other Toll Carriers are small entities that may be 
affected by the rules and policies adopted pursuant to the Order.
    75. 800 and 800-Like Service Subscribers. Neither the Commission 
nor the SBA has developed a small business size standard specifically 
for 800 and 800-like service (toll free) subscribers. The appropriate 
size standard under SBA rules is for the category Telecommunications 
Resellers. Under that size standard, such a business is small if it has 
1,500 or fewer employees. The most reliable source of information 
regarding the number of these service subscribers appears to be data 
the Commission collects on the 800, 888, 877, and 866 numbers in use. 
According to our data, as of September 2009, the number of 800 numbers 
assigned was 7,860,000; the number of 888 numbers assigned was 
5,588,687; the number of 877 numbers assigned was 4,721,866; and the 
number of 866 numbers assigned was 7,867,736. We do not have data 
specifying the number of these subscribers that are not independently 
owned and operated or have more than 1,500 employees, and thus are 
unable at this time to estimate with greater precision the number of 
toll free subscribers that would qualify as small businesses under the 
SBA size standard. Consequently, we estimate that there are 7,860,000 
or fewer small entity 800 subscribers; 5,588,687 or fewer small entity 
888 subscribers; 4,721,866 or fewer small entity 877 subscribers; and 
7,867,736 or fewer small entity 866 subscribers.
    76. Wireless Telecommunications Carriers (except Satellite). Since 
2007, the SBA has recognized wireless firms within this new, broad, 
economic census category. Prior to that time, such firms were within 
the now-superseded categories of Paging and Cellular and Other Wireless 
Telecommunications. Under the present and prior categories, the SBA has 
deemed a wireless business to be small if it has 1,500 or fewer 
employees. For this category, census data for 2007 show that there were 
1,383 firms that operated for the entire year. Of this total, 1,368 
firms had employment of 999 or fewer employees and 15 had employment of 
1,000 employees or more. Similarly, according

[[Page 2581]]

to Commission data, 413 carriers reported that they were engaged in the 
provision of wireless telephony, including cellular service, Personal 
Communications Service (PCS), and Specialized Mobile Radio (SMR) 
Telephony services. Of these, an estimated 261 have 1,500 or fewer 
employees and 152 have more than 1,500 employees. Consequently, the 
Commission estimates that approximately half or more of these firms can 
be considered small. Thus, using available data, we estimate that the 
majority of wireless firms can be considered small.
    77. Broadband Personal Communications Service. The broadband 
personal communications service (PCS) spectrum is divided into six 
frequency blocks designated A through F, and the Commission has held 
auctions for each block. The Commission defined ``small entity'' for 
Blocks C and F as an entity that has average gross revenues of $40 
million or less in the three previous calendar years. For Block F, an 
additional classification for ``very small business'' was added and is 
defined as an entity that, together with its affiliates, has average 
gross revenues of not more than $15 million for the preceding three 
calendar years. These standards defining ``small entity'' in the 
context of broadband PCS auctions have been approved by the SBA. No 
small businesses, within the SBA-approved small business size standards 
bid successfully for licenses in Blocks A and B. There were 90 winning 
bidders that qualified as small entities in the Block C auctions. A 
total of 93 small and very small business bidders won approximately 40 
percent of the 1,479 licenses for Blocks D, E, and F. In 1999, the 
Commission re-auctioned 347 C, E, and F Block licenses. There were 48 
small business winning bidders. In 2001, the Commission completed the 
auction of 422 C and F Broadband PCS licenses in Auction 35. Of the 35 
winning bidders in this auction, 29 qualified as ``small'' or ``very 
small'' businesses. Subsequent events, concerning Auction 35, including 
judicial and agency determinations, resulted in a total of 163 C and F 
Block licenses being available for grant. In 2005, the Commission 
completed an auction of 188 C block licenses and 21 F block licenses in 
Auction 58. There were 24 winning bidders for 217 licenses. Of the 24 
winning bidders, 16 claimed small business status and won 156 licenses. 
In 2007, the Commission completed an auction of 33 licenses in the A, 
C, and F Blocks in Auction 71. Of the 14 winning bidders, six were 
designated entities. In 2008, the Commission completed an auction of 20 
Broadband PCS licenses in the C, D, E and F block licenses in Auction 
78.
    78. Advanced Wireless Services. In 2008, the Commission conducted 
the auction of Advanced Wireless Services (``AWS'') licenses. This 
auction, which as designated as Auction 78, offered 35 licenses in the 
AWS 1710-1755 MHz and 2110-2155 MHz bands (``AWS-1''). The AWS-1 
licenses were licenses for which there were no winning bids in Auction 
66. That same year, the Commission completed Auction 78. A bidder with 
attributed average annual gross revenues that exceeded $15 million and 
did not exceed $40 million for the preceding three years (``small 
business'') received a 15 percent discount on its winning bid. A bidder 
with attributed average annual gross revenues that did not exceed $15 
million for the preceding three years (``very small business'') 
received a 25 percent discount on its winning bid. A bidder that had 
combined total assets of less than $500 million and combined gross 
revenues of less than $125 million in each of the last two years 
qualified for entrepreneur status. Four winning bidders that identified 
themselves as very small businesses won 17 licenses. Three of the 
winning bidders that identified themselves as a small business won five 
licenses. Additionally, one other winning bidder that qualified for 
entrepreneur status won 2 licenses.
    79. Narrowband Personal Communications Services. In 1994, the 
Commission conducted an auction for Narrowband PCS licenses. A second 
auction was also conducted later in 1994. For purposes of the first two 
Narrowband PCS auctions, ``small businesses'' were entities with 
average gross revenues for the prior three calendar years of $40 
million or less. Through these auctions, the Commission awarded a total 
of 41 licenses, 11 of which were obtained by four small businesses. To 
ensure meaningful participation by small business entities in future 
auctions, the Commission adopted a two-tiered small business size 
standard in the Narrowband PCS Second Report and Order. A ``small 
business'' is an entity that, together with affiliates and controlling 
interests, has average gross revenues for the three preceding years of 
not more than $40 million. A ``very small business'' is an entity that, 
together with affiliates and controlling interests, has average gross 
revenues for the three preceding years of not more than $15 million. 
The SBA has approved these small business size standards. A third 
auction was conducted in 2001. Here, five bidders won 317 (Metropolitan 
Trading Areas and nationwide) licenses. Three of these claimed status 
as a small or very small entity and won 311 licenses.
    80. Paging (Private and Common Carrier). In the Paging Third Report 
and Order, we developed a small business size standard for ``small 
businesses'' and ``very small businesses'' for purposes of determining 
their eligibility for special provisions such as bidding credits and 
installment payments. A ``small business'' is an entity that, together 
with its affiliates and controlling principals, has average gross 
revenues not exceeding $15 million for the preceding three years. 
Additionally, a ``very small business'' is an entity that, together 
with its affiliates and controlling principals, has average gross 
revenues that are not more than $3 million for the preceding three 
years. The SBA has approved these small business size standards. 
According to Commission data, 291 carriers have reported that they are 
engaged in Paging or Messaging Service. Of these, an estimated 289 have 
1,500 or fewer employees, and two have more than 1,500 employees. 
Consequently, the Commission estimates that the majority of paging 
providers are small entities that may be affected by our action. An 
auction of Metropolitan Economic Area licenses commenced on February 
24, 2000, and closed on March 2, 2000. Of the 2,499 licenses auctioned, 
985 were sold. Fifty-seven companies claiming small business status won 
440 licenses. A subsequent auction of MEA and Economic Area (``EA'') 
licenses was held in the year 2001. Of the 15,514 licenses auctioned, 
5,323 were sold. One hundred thirty-two companies claiming small 
business status purchased 3,724 licenses. A third auction, consisting 
of 8,874 licenses in each of 175 EAs and 1,328 licenses in all but 
three of the 51 MEAs, was held in 2003. Seventy-seven bidders claiming 
small or very small business status won 2,093 licenses. A fourth 
auction, consisting of 9,603 lower and upper paging band licenses was 
held in the year 2010. Twenty-nine bidders claiming small or very small 
business status won 3,016 licenses.
    81. 220 MHz Radio Service--Phase I Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. Phase I licensing was conducted 
by lotteries in 1992 and 1993. There are approximately 1,515 such non-
nationwide licensees and four nationwide licensees currently authorized 
to operate in the 220 MHz band. The Commission has not developed a 
small business size

[[Page 2582]]

standard for small entities specifically applicable to such incumbent 
220 MHz Phase I licensees. To estimate the number of such licensees 
that are small businesses, we apply the small business size standard 
under the SBA rules applicable to Wireless Telecommunications Carriers 
(except Satellite). Under this category, the SBA deems a wireless 
business to be small if it has 1,500 or fewer employees. The Commission 
estimates that nearly all such licensees are small businesses under the 
SBA's small business size standard that may be affected by rules 
adopted pursuant to the Order.
    82. 220 MHz Radio Service--Phase II Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. The Phase II 220 MHz service is 
subject to spectrum auctions. In the 220 MHz Third Report and Order, we 
adopted a small business size standard for ``small'' and ``very small'' 
businesses for purposes of determining their eligibility for special 
provisions such as bidding credits and installment payments. This small 
business size standard indicates that a ``small business'' is an entity 
that, together with its affiliates and controlling principals, has 
average gross revenues not exceeding $15 million for the preceding 
three years. A ``very small business'' is an entity that, together with 
its affiliates and controlling principals, has average gross revenues 
that do not exceed $3 million for the preceding three years. The SBA 
has approved these small business size standards. Auctions of Phase II 
licenses commenced on September 15, 1998, and closed on October 22, 
1998. In the first auction, 908 licenses were auctioned in three 
different-sized geographic areas: Three nationwide licenses, 30 
Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA) 
Licenses. Of the 908 licenses auctioned, 693 were sold. Thirty-nine 
small businesses won licenses in the first 220 MHz auction. The second 
auction included 225 licenses: 216 EA licenses and 9 EAG licenses. 
Fourteen companies claiming small business status won 158 licenses.
    83. Specialized Mobile Radio. The Commission awards small business 
bidding credits in auctions for Specialized Mobile Radio (``SMR'') 
geographic area licenses in the 800 MHz and 900 MHz bands to entities 
that had revenues of no more than $15 million in each of the three 
previous calendar years. The Commission awards very small business 
bidding credits to entities that had revenues of no more than $3 
million in each of the three previous calendar years. The SBA has 
approved these small business size standards for the 800 MHz and 900 
MHz SMR Services. The Commission has held auctions for geographic area 
licenses in the 800 MHz and 900 MHz bands. The 900 MHz SMR auction was 
completed in 1996. Sixty bidders claiming that they qualified as small 
businesses under the $15 million size standard won 263 geographic area 
licenses in the 900 MHz SMR band. The 800 MHz SMR auction for the upper 
200 channels was conducted in 1997. Ten bidders claiming that they 
qualified as small businesses under the $15 million size standard won 
38 geographic area licenses for the upper 200 channels in the 800 MHz 
SMR band. A second auction for the 800 MHz band was conducted in 2002 
and included 23 BEA licenses. One bidder claiming small business status 
won five licenses.
    84. The auction of the 1,053 800 MHz SMR geographic area licenses 
for the General Category channels was conducted in 2000. Eleven bidders 
won 108 geographic area licenses for the General Category channels in 
the 800 MHz SMR band qualified as small businesses under the $15 
million size standard. In an auction completed in 2000, a total of 
2,800 Economic Area licenses in the lower 80 channels of the 800 MHz 
SMR service were awarded. Of the 22 winning bidders, 19 claimed small 
business status and won 129 licenses. Thus, combining all three 
auctions, 40 winning bidders for geographic licenses in the 800 MHz SMR 
band claimed status as small business.
    85. In addition, there are numerous incumbent site-by-site SMR 
licensees and licensees with extended implementation authorizations in 
the 800 and 900 MHz bands. We do not know how many firms provide 800 
MHz or 900 MHz geographic area SMR pursuant to extended implementation 
authorizations, nor how many of these providers have annual revenues of 
no more than $15 million. One firm has over $15 million in revenues. In 
addition, we do not know how many of these firms have 1,500 or fewer 
employees. We assume, for purposes of this analysis, that all of the 
remaining existing extended implementation authorizations are held by 
small entities, as that small business size standard is approved by the 
SBA.
    86. Broadband Radio Service and Educational Broadband Service. 
Broadband Radio Service systems, previously referred to as Multipoint 
Distribution Service (``MDS'') and Multichannel Multipoint Distribution 
Service (``MMDS'') systems, and ``wireless cable,'' transmit video 
programming to subscribers and provide two-way high speed data 
operations using the microwave frequencies of the Broadband Radio 
Service (``BRS'') and Educational Broadband Service (``EBS'') 
(previously referred to as the Instructional Television Fixed Service 
(``ITFS'')). In connection with the 1996 BRS auction, the Commission 
established a small business size standard as an entity that had annual 
average gross revenues of no more than $40 million in the previous 
three calendar years. The BRS auctions resulted in 67 successful 
bidders obtaining licensing opportunities for 493 Basic Trading Areas 
(``BTAs''). Of the 67 auction winners, 61 met the definition of a small 
business. BRS also includes licensees of stations authorized prior to 
the auction. At this time, we estimate that of the 61 small business 
BRS auction winners, 48 remain small business licensees. In addition to 
the 48 small businesses that hold BTA authorizations, there are 
approximately 392 incumbent BRS licensees that are considered small 
entities. After adding the number of small business auction licensees 
to the number of incumbent licensees not already counted, we find that 
there are currently approximately 440 BRS licensees that are defined as 
small businesses under either the SBA or the Commission's rules. The 
Commission has adopted three levels of bidding credits for BRS: (i) A 
bidder with attributed average annual gross revenues that exceed $15 
million and do not exceed $40 million for the preceding three years 
(small business) is eligible to receive a 15 percent discount on its 
winning bid; (ii) a bidder with attributed average annual gross 
revenues that exceed $3 million and do not exceed $15 million for the 
preceding three years (very small business) is eligible to receive a 25 
percent discount on its winning bid; and (iii) a bidder with attributed 
average annual gross revenues that do not exceed $3 million for the 
preceding three years (entrepreneur) is eligible to receive a 35 
percent discount on its winning bid. In 2009, the Commission conducted 
Auction 86, which offered 78 BRS licenses. Auction 86 concluded with 
ten bidders winning 61 licenses. Of the ten, two bidders claimed small 
business status and won 4 licenses; one bidder claimed very small 
business status and won three licenses; and two bidders claimed 
entrepreneur status and won six licenses.
    87. In addition, the SBA's Cable Television Distribution Services 
small business size standard is applicable to EBS. There are presently 
2,032 EBS licensees. All but 100 of these licenses are held by 
educational institutions.

[[Page 2583]]

Educational institutions are included in this analysis as small 
entities. Thus, we estimate that at least 1,932 licensees are small 
businesses. Since 2007, Cable Television Distribution Services have 
been defined within the broad economic census category of Wired 
Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.'' The SBA defines a small business size standard for this 
category as any such firms having 1,500 or fewer employees. The SBA has 
developed a small business size standard for this category, which is: 
all such firms having 1,500 or fewer employees. According to Census 
Bureau data for 2007, there were a total of 955 firms in this previous 
category that operated for the entire year. Of this total, 939 firms 
had employment of 999 or fewer employees, and 16 firms had employment 
of 1000 employees or more. Thus, under this size standard, the majority 
of firms can be considered small and may be affected by rules adopted 
pursuant to the Order.
    88. Lower 700 MHz Band Licenses. The Commission previously adopted 
criteria for defining three groups of small businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits. The Commission defined a ``small business'' as an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues not exceeding $40 million for the preceding three years. 
A ``very small business'' is defined as an entity that, together with 
its affiliates and controlling principals, has average gross revenues 
that are not more than $15 million for the preceding three years. 
Additionally, the Lower 700 MHz Band had a third category of small 
business status for Metropolitan/Rural Service Area (``MSA/RSA'') 
licenses, identified as ``entrepreneur'' and defined as an entity that, 
together with its affiliates and controlling principals, has average 
gross revenues that are not more than $3 million for the preceding 
three years. The SBA approved these small size standards. The 
Commission conducted an auction in 2002 of 740 Lower 700 MHz Band 
licenses (one license in each of the 734 MSAs/RSAs and one license in 
each of the six Economic Area Groupings (EAGs)). Of the 740 licenses 
available for auction, 484 licenses were sold to 102 winning bidders. 
Seventy-two of the winning bidders claimed small business, very small 
business or entrepreneur status and won a total of 329 licenses. The 
Commission conducted a second Lower 700 MHz Band auction in 2003 that 
included 256 licenses: 5 EAG licenses and 476 Cellular Market Area 
licenses. Seventeen winning bidders claimed small or very small 
business status and won 60 licenses, and nine winning bidders claimed 
entrepreneur status and won 154 licenses. In 2005, the Commission 
completed an auction of 5 licenses in the Lower 700 MHz Band, 
designated Auction 60. There were three winning bidders for five 
licenses. All three winning bidders claimed small business status.
    89. In 2007, the Commission reexamined its rules governing the 700 
MHz band in the 700 MHz Second Report and Order. The 700 MHz Second 
Report and Order revised the band plan for the commercial (including 
Guard Band) and public safety spectrum, adopted services rules, 
including stringent build-out requirements, an open platform 
requirement on the C Block, and a requirement on the D Block licensee 
to construct and operate a nationwide, interoperable wireless broadband 
network for public safety users. An auction of A, B and E block 
licenses in the Lower 700 MHz band was held in 2008. Twenty winning 
bidders claimed small business status (those with attributable average 
annual gross revenues that exceed $15 million and do not exceed $40 
million for the preceding three years). Thirty three winning bidders 
claimed very small business status (those with attributable average 
annual gross revenues that do not exceed $15 million for the preceding 
three years). In 2011, the Commission conducted Auction 92, which 
offered 16 Lower 700 MHz band licenses that had been made available in 
Auction 73 but either remained unsold or were licenses on which a 
winning bidder defaulted. Two of the seven winning bidders in Auction 
92 claimed very small business status, winning a total of four 
licenses.
    90. Upper 700 MHz Band Licenses. In the 700 MHz Second Report and 
Order, the Commission revised its rules regarding Upper 700 MHz band 
licenses. In 2008, the Commission conducted Auction 73 in which C and D 
block licenses in the Upper 700 MHz band were available. Three winning 
bidders claimed very small business status (those with attributable 
average annual gross revenues that do not exceed $15 million for the 
preceding three years).
    91. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order, 
we adopted a small business size standard for ``small businesses'' and 
``very small businesses'' for purposes of determining their eligibility 
for special provisions such as bidding credits and installment 
payments. A ``small business'' is an entity that, together with its 
affiliates and controlling principals, has average gross revenues not 
exceeding $40 million for the preceding three years. Additionally, a 
``very small business'' is an entity that, together with its affiliates 
and controlling principals, has average gross revenues that are not 
more than $15 million for the preceding three years. An auction of 52 
Major Economic Area (MEA) licenses commenced on September 6, 2000, and 
closed on September 21, 2000. Of the 104 licenses auctioned, 96 
licenses were sold to nine bidders. Five of these bidders were small 
businesses that won a total of 26 licenses. A second auction of 700 MHz 
Guard Band licenses commenced on February 13, 2001 and closed on 
February 21, 2001. All eight of the licenses auctioned were sold to 
three bidders. One of these bidders was a small business that won a 
total of two licenses.
    92. Cellular Radiotelephone Service. Auction 77 was held to resolve 
one group of mutually exclusive applications for Cellular 
Radiotelephone Service licenses for unserved areas in New Mexico. 
Bidding credits for designated entities were not available in Auction 
77. In 2008, the Commission completed the closed auction of one 
unserved service area in the Cellular Radiotelephone Service, 
designated as Auction 77. Auction 77 concluded with one provisionally 
winning bid for the unserved area totaling $25,002.
    93. Private Land Mobile Radio (``PLMR''). PLMR systems serve an 
essential role in a range of industrial, business, land transportation, 
and public safety activities. These radios are used by companies of all 
sizes operating in all U.S. business categories, and are often used in 
support of the licensee's primary (non-telecommunications) business 
operations. For the purpose of determining whether a licensee of a PLMR 
system is a small business as defined by the SBA, we use the broad 
census category, Wireless Telecommunications Carriers (except 
Satellite). This definition provides that a small entity is any such 
entity employing no more than 1,500 persons. The Commission does not 
require PLMR licensees to disclose information about number of 
employees, so the Commission does not have information that could be 
used to determine how

[[Page 2584]]

many PLMR licensees constitute small entities under this definition. We 
note that PLMR licensees generally use the licensed facilities in 
support of other business activities, and therefore, it would also be 
helpful to assess PLMR licensees under the standards applied to the 
particular industry subsector to which the licensee belongs.
    94. As of March 2010, there were 424,162 PLMR licensees operating 
921,909 transmitters in the PLMR bands below 512 MHz. We note that any 
entity engaged in a commercial activity is eligible to hold a PLMR 
license, and that any revised rules in this context could therefore 
potentially impact small entities covering a great variety of 
industries.
    95. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service. A significant subset of the Rural Radiotelephone Service is 
the Basic Exchange Telephone Radio System (``BETRS''). In the present 
context, we will use the SBA's small business size standard applicable 
to Wireless Telecommunications Carriers (except Satellite), i.e., an 
entity employing no more than 1,500 persons. There are approximately 
1,000 licensees in the Rural Radiotelephone Service, and the Commission 
estimates that there are 1,000 or fewer small entity licensees in the 
Rural Radiotelephone Service that may be affected by the rules and 
policies proposed herein.
    96. Air-Ground Radiotelephone Service. The Commission has not 
adopted a small business size standard specific to the Air-Ground 
Radiotelephone Service. We will use SBA's small business size standard 
applicable to Wireless Telecommunications Carriers (except Satellite), 
i.e., an entity employing no more than 1,500 persons. There are 
approximately 100 licensees in the Air-Ground Radiotelephone Service, 
and we estimate that almost all of them qualify as small under the SBA 
small business size standard and may be affected by rules adopted 
pursuant to the Order.
    97. Aviation and Marine Radio Services. Small businesses in the 
aviation and marine radio services use a very high frequency (VHF) 
marine or aircraft radio and, as appropriate, an emergency position-
indicating radio beacon (and/or radar) or an emergency locator 
transmitter. The Commission has not developed a small business size 
standard specifically applicable to these small businesses. For 
purposes of this analysis, the Commission uses the SBA small business 
size standard for the category Wireless Telecommunications Carriers 
(except Satellite), which is 1,500 or fewer employees. Census data for 
2007, which supersede data contained in the 2002 Census, show that 
there were 1,383 firms that operated that year. Of those 1,383, 1,368 
had fewer than 100 employees, and 15 firms had more than 100 employees. 
Most applicants for recreational licenses are individuals. 
Approximately 581,000 ship station licensees and 131,000 aircraft 
station licensees operate domestically and are not subject to the radio 
carriage requirements of any statute or treaty. For purposes of our 
evaluations in this analysis, we estimate that there are up to 
approximately 712,000 licensees that are small businesses (or 
individuals) under the SBA standard. In addition, between December 3, 
1998 and December 14, 1998, the Commission held an auction of 42 VHF 
Public Coast licenses in the 157.1875-157.4500 MHz (ship transmit) and 
161.775-162.0125 MHz (coast transmit) bands. For purposes of the 
auction, the Commission defined a ``small'' business as an entity that, 
together with controlling interests and affiliates, has average gross 
revenues for the preceding three years not to exceed $15 million 
dollars. In addition, a ``very small'' business is one that, together 
with controlling interests and affiliates, has average gross revenues 
for the preceding three years not to exceed $3 million dollars. There 
are approximately 10,672 licensees in the Marine Coast Service, and the 
Commission estimates that almost all of them qualify as ``small'' 
businesses under the above special small business size standards and 
may be affected by rules adopted pursuant to the Order.
    98. Fixed Microwave Services. Fixed microwave services include 
common carrier, private operational-fixed, and broadcast auxiliary 
radio services. At present, there are approximately 22,015 common 
carrier fixed licensees and 61,670 private operational-fixed licensees 
and broadcast auxiliary radio licensees in the microwave services. The 
Commission has not created a size standard for a small business 
specifically with respect to fixed microwave services. For purposes of 
this analysis, the Commission uses the SBA small business size standard 
for Wireless Telecommunications Carriers (except Satellite), which is 
1,500 or fewer employees. The Commission does not have data specifying 
the number of these licensees that have more than 1,500 employees, and 
thus is unable at this time to estimate with greater precision the 
number of fixed microwave service licensees that would qualify as small 
business concerns under the SBA's small business size standard. 
Consequently, the Commission estimates that there are up to 22,015 
common carrier fixed licensees and up to 61,670 private operational-
fixed licensees and broadcast auxiliary radio licensees in the 
microwave services that may be small and may be affected by the rules 
and policies adopted herein. We note, however, that the common carrier 
microwave fixed licensee category includes some large entities.
    99. Offshore Radiotelephone Service. This service operates on 
several UHF television broadcast channels that are not used for 
television broadcasting in the coastal areas of states bordering the 
Gulf of Mexico. There are presently approximately 55 licensees in this 
service. The Commission is unable to estimate at this time the number 
of licensees that would qualify as small under the SBA's small business 
size standard for the category of Wireless Telecommunications Carriers 
(except Satellite). Under that SBA small business size standard, a 
business is small if it has 1,500 or fewer employees. Census data for 
2007, which supersede data contained in the 2002 Census, show that 
there were 1,383 firms that operated that year. Of those 1,383, 1,368 
had fewer than 100 employees, and 15 firms had more than 100 employees. 
Thus, under this category and the associated small business size 
standard, the majority of firms can be considered small.
    100. 39 GHz Service. The Commission created a special small 
business size standard for 39 GHz licenses--an entity that has average 
gross revenues of $40 million or less in the three previous calendar 
years. An additional size standard for ``very small business'' is: An 
entity that, together with affiliates, has average gross revenues of 
not more than $15 million for the preceding three calendar years. The 
SBA has approved these small business size standards. The auction of 
the 2,173 39 GHz licenses began on April 12, 2000 and closed on May 8, 
2000. The 18 bidders who claimed small business status won 849 
licenses. Consequently, the Commission estimates that 18 or fewer 39 
GHz licensees are small entities that may be affected by rules adopted 
pursuant to the Report and Order.
    101. Local Multipoint Distribution Service. Local Multipoint 
Distribution Service (``LMDS'') is a fixed broadband point-to-
multipoint microwave service that provides for two-way video 
telecommunications. The auction of the 986 LMDS licenses began and 
closed in 1998. The Commission established a

[[Page 2585]]

small business size standard for LMDS licenses as an entity that has 
average gross revenues of less than $40 million in the three previous 
calendar years. An additional small business size standard for ``very 
small business'' was added as an entity that, together with its 
affiliates, has average gross revenues of not more than $15 million for 
the preceding three calendar years. The SBA has approved these small 
business size standards in the context of LMDS auctions. There were 93 
winning bidders that qualified as small entities in the LMDS auctions. 
A total of 93 small and very small business bidders won approximately 
277 A Block licenses and 387 B Block licenses. In 1999, the Commission 
re-auctioned 161 licenses; there were 32 small and very small 
businesses winning that won 119 licenses.
    102. 218-219 MHz Service. The first auction of 218-219 MHz spectrum 
resulted in 170 entities winning licenses for 594 Metropolitan 
Statistical Area (MSA) licenses. Of the 594 licenses, 557 were won by 
entities qualifying as a small business. For that auction, the small 
business size standard was an entity that, together with its 
affiliates, has no more than a $6 million net worth and, after federal 
income taxes (excluding any carry over losses), has no more than $2 
million in annual profits each year for the previous two years. In the 
218-219 MHz Report and Order and Memorandum Opinion and Order, we 
established a small business size standard for a ``small business'' as 
an entity that, together with its affiliates and persons or entities 
that hold interests in such an entity and their affiliates, has average 
annual gross revenues not to exceed $15 million for the preceding three 
years. A ``very small business'' is defined as an entity that, together 
with its affiliates and persons or entities, that hold interests in 
such an entity and its affiliates, has average annual gross revenues 
not to exceed $3 million for the preceding three years. These size 
standards will be used in future auctions of 218-219 MHz spectrum.
    103. 2.3 GHz Wireless Communications Services. This service can be 
used for fixed, mobile, radiolocation, and digital audio broadcasting 
satellite uses. The Commission defined ``small business'' for the 
wireless communications services (``WCS'') auction as an entity with 
average gross revenues of $40 million for each of the three preceding 
years, and a ``very small business'' as an entity with average gross 
revenues of $15 million for each of the three preceding years. The SBA 
has approved these definitions. The Commission auctioned geographic 
area licenses in the WCS service. In the auction, which was conducted 
in 1997, there were seven bidders that won 31 licenses that qualified 
as very small business entities, and one bidder that won one license 
that qualified as a small business entity.
    104. 1670-1675 MHz Band. An auction for one license in the 1670-
1675 MHz band was conducted in 2003. The Commission defined a ``small 
business'' as an entity with attributable average annual gross revenues 
of not more than $40 million for the preceding three years and thus 
would be eligible for a 15 percent discount on its winning bid for the 
1670-1675 MHz band license. Further, the Commission defined a ``very 
small business'' as an entity with attributable average annual gross 
revenues of not more than $15 million for the preceding three years and 
thus would be eligible to receive a 25 percent discount on its winning 
bid for the 1670-1675 MHz band license. One license was awarded. The 
winning bidder was not a small entity.
    105. 3650-3700 MHz band. In March 2005, the Commission released a 
Report and Order and Memorandum Opinion and Order that provides for 
nationwide, non-exclusive licensing of terrestrial operations, 
utilizing contention-based technologies, in the 3650 MHz band (i.e., 
3650-3700 MHz). As of April 2010, more than 1270 licenses have been 
granted and more than 7433 sites have been registered. The Commission 
has not developed a definition of small entities applicable to 3650-
3700 MHz band nationwide, non-exclusive licensees. However, we estimate 
that the majority of these licensees are Internet Access Service 
Providers (ISPs) and that most of those licensees are small businesses.
    106. 24 GHz--Incumbent Licensees. This analysis may affect 
incumbent licensees who were relocated to the 24 GHz band from the 18 
GHz band, and applicants who wish to provide services in the 24 GHz 
band. For this service, the Commission uses the SBA small business size 
standard for the category ``Wireless Telecommunications Carriers 
(except satellite),'' which is 1,500 or fewer employees. To gauge small 
business prevalence for these cable services we must, however, use the 
most current census data. Census data for 2007, which supersede data 
contained in the 2002 Census, show that there were 1,383 firms that 
operated that year. Of those 1,383, 1,368 had fewer than 100 employees, 
and 15 firms had more than 100 employees. Thus under this category and 
the associated small business size standard, the majority of firms can 
be considered small. The Commission notes that the Census' use of the 
classifications ``firms'' does not track the number of ``licenses.'' 
The Commission believes that there are only two licensees in the 24 GHz 
band that were relocated from the 18 GHz band, Teligent and TRW, Inc. 
It is our understanding that Teligent and its related companies have 
less than 1,500 employees, though this may change in the future. TRW is 
not a small entity. Thus, only one incumbent licensee in the 24 GHz 
band is a small business entity.
    107. 24 GHz--Future Licensees. With respect to new applicants in 
the 24 GHz band, the size standard for ``small business'' is an entity 
that, together with controlling interests and affiliates, has average 
annual gross revenues for the three preceding years not in excess of 
$15 million. ``Very small business'' in the 24 GHz band is an entity 
that, together with controlling interests and affiliates, has average 
gross revenues not exceeding $3 million for the preceding three years. 
The SBA has approved these small business size standards. These size 
standards will apply to a future 24 GHz license auction, if held.
    108. Satellite Telecommunications. Since 2007, the SBA has 
recognized satellite firms within this revised category, with a small 
business size standard of $15 million. The most current Census Bureau 
data are from the economic census of 2007, and we will use those 
figures to gauge the prevalence of small businesses in this category. 
Those size standards are for the two census categories of ``Satellite 
Telecommunications'' and ``Other Telecommunications.'' Under the 
``Satellite Telecommunications'' category, a business is considered 
small if it had $15 million or less in average annual receipts. Under 
the ``Other Telecommunications'' category, a business is considered 
small if it had $25 million or less in average annual receipts.
    109. The first category of Satellite Telecommunications ``comprises 
establishments primarily engaged in providing point-to-point 
telecommunications services to other establishments in the 
telecommunications and broadcasting industries by forwarding and 
receiving communications signals via a system of satellites or 
reselling satellite telecommunications.'' For this category, Census 
Bureau data for 2007 show that there were a total of 512 firms that 
operated for the entire year. Of this total, 464 firms had annual 
receipts of under $10 million, and 18 firms had receipts of $10 million 
to $24,999,999. Consequently, we estimate that the

[[Page 2586]]

majority of Satellite Telecommunications firms are small entities that 
might be affected by rules adopted pursuant to the Order.
    110. The second category of Other Telecommunications ``primarily 
engaged in providing specialized telecommunications services, such as 
satellite tracking, communications telemetry, and radar station 
operation. This industry also includes establishments primarily engaged 
in providing satellite terminal stations and associated facilities 
connected with one or more terrestrial systems and capable of 
transmitting telecommunications to, and receiving telecommunications 
from, satellite systems. Establishments providing Internet services or 
voice over Internet protocol (VoIP) services via client-supplied 
telecommunications connections are also included in this industry.'' 
For this category, Census Bureau data for 2007 show that there were a 
total of 2,383 firms that operated for the entire year. Of this total, 
2,346 firms had annual receipts of under $25 million. Consequently, we 
estimate that the majority of Other Telecommunications firms are small 
entities that might be affected by our action.
    111. Cable and Other Program Distribution. Since 2007, these 
services have been defined within the broad economic census category of 
Wired Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.'' The SBA has developed a small business size standard 
for this category, which is: All such firms having 1,500 or fewer 
employees. According to Census Bureau data for 2007, there were a total 
of 955 firms in this previous category that operated for the entire 
year. Of this total, 939 firms had employment of 999 or fewer 
employees, and 16 firms had employment of 1000 employees or more. Thus, 
under this size standard, the majority of firms can be considered small 
and may be affected by rules adopted pursuant to the Order.
    112. Cable Companies and Systems. The Commission has developed its 
own small business size standards, for the purpose of cable rate 
regulation. Under the Commission's rules, a ``small cable company'' is 
one serving 400,000 or fewer subscribers, nationwide. Industry data 
indicate that, of 1,076 cable operators nationwide, all but eleven are 
small under this size standard. In addition, under the Commission's 
rules, a ``small system'' is a cable system serving 15,000 or fewer 
subscribers. Industry data indicate that, of 7,208 systems nationwide, 
6,139 systems have fewer than 10,000 subscribers, and an additional 379 
systems have 10,000-19,999 subscribers. Thus, under this second size 
standard, most cable systems are small and may be affected by rules 
adopted pursuant to the Order.
    113. Cable System Operators. The Act also contains a size standard 
for small cable system operators, which is ``a cable operator that, 
directly or through an affiliate, serves in the aggregate less than 1 
percent of all subscribers in the United States and is not affiliated 
with any entity or entities whose gross annual revenues in the 
aggregate exceed $250,000,000.'' The Commission has determined that an 
operator serving fewer than 677,000 subscribers shall be deemed a small 
operator, if its annual revenues, when combined with the total annual 
revenues of all its affiliates, do not exceed $250 million in the 
aggregate. Industry data indicate that, of 1,076 cable operators 
nationwide, all but ten are small under this size standard. We note 
that the Commission neither requests nor collects information on 
whether cable system operators are affiliated with entities whose gross 
annual revenues exceed $250 million, and therefore we are unable to 
estimate more accurately the number of cable system operators that 
would qualify as small under this size standard.
    114. Open Video Services. The open video system (``OVS'') framework 
was established in 1996, and is one of four statutorily recognized 
options for the provision of video programming services by local 
exchange carriers. The OVS framework provides opportunities for the 
distribution of video programming other than through cable systems. 
Because OVS operators provide subscription services, OVS falls within 
the SBA small business size standard covering cable services, which is 
``Wired Telecommunications Carriers.'' The SBA has developed a small 
business size standard for this category, which is: All such firms 
having 1,500 or fewer employees. According to Census Bureau data for 
2007, there were a total of 955 firms in this previous category that 
operated for the entire year. Of this total, 939 firms had employment 
of 999 or fewer employees, and 16 firms had employment of 1000 
employees or more. Thus, under this second size standard, most cable 
systems are small and may be affected by rules adopted pursuant to the 
Order. In addition, we note that the Commission has certified some OVS 
operators, with some now providing service. Broadband service providers 
(``BSPs'') are currently the only significant holders of OVS 
certifications or local OVS franchises. The Commission does not have 
financial or employment information regarding the entities authorized 
to provide OVS, some of which may not yet be operational. Thus, again, 
at least some of the OVS operators may qualify as small entities.
    115. Internet Service Providers. Since 2007, these services have 
been defined within the broad economic census category of Wired 
Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.'' The SBA has developed a small business size standard 
for this category, which is: All such firms having 1,500 or fewer 
employees. According to Census Bureau data for 2007, there were 3,188 
firms in this category, total, that operated for the entire year. Of 
this total, 3144 firms had employment of 999 or fewer employees, and 44 
firms had employment of 1000 employees or more. Thus, under this size 
standard, the majority of firms can be considered small. In addition, 
according to Census Bureau data for 2007, there were a total of 396 
firms in the category Internet Service Providers (broadband) that 
operated for the entire year. Of this total, 394 firms had employment 
of 999 or fewer employees, and two firms had employment of 1000 
employees or more. Consequently, we estimate that the majority of these 
firms are small entities that may be affected by rules adopted pursuant 
to the Order.
    116. Internet Publishing and Broadcasting and Web Search Portals. 
Our action may pertain to interconnected VoIP services, which could be 
provided by entities that provide other services such as email, online 
gaming, web browsing, video conferencing, instant messaging, and other, 
similar IP-enabled services. The Commission has not adopted a size 
standard for entities that create or provide these types of services or 
applications. However, the Census Bureau has identified firms that 
``primarily engaged in (1) publishing and/or broadcasting content on 
the

[[Page 2587]]

Internet exclusively or (2) operating Web sites that use a search 
engine to generate and maintain extensive databases of Internet 
addresses and content in an easily searchable format (and known as Web 
search portals).'' The SBA has developed a small business size standard 
for this category, which is: All such firms having 500 or fewer 
employees. According to Census Bureau data for 2007, there were 2,705 
firms in this category that operated for the entire year. Of this 
total, 2,682 firms had employment of 499 or fewer employees, and 23 
firms had employment of 500 employees or more. Consequently, we 
estimate that the majority of these firms are small entities that may 
be affected by rules adopted pursuant to the Order.
    117. Data Processing, Hosting, and Related Services. Entities in 
this category ``primarily * * * provid[e] infrastructure for hosting or 
data processing services.'' The SBA has developed a small business size 
standard for this category; that size standard is $25 million or less 
in average annual receipts. According to Census Bureau data for 2007, 
there were 8,060 firms in this category that operated for the entire 
year. Of these, 7,744 had annual receipts of under $24,999,999. 
Consequently, we estimate that the majority of these firms are small 
entities that may be affected by rules adopted pursuant to the Order.
    118. All Other Information Services. The Census Bureau defines this 
industry as including ``establishments primarily engaged in providing 
other information services (except news syndicates, libraries, 
archives, Internet publishing and broadcasting, and Web search 
portals).'' Our action pertains to interconnected VoIP services, which 
could be provided by entities that provide other services such as 
email, online gaming, web browsing, video conferencing, instant 
messaging, and other, similar IP-enabled services. The SBA has 
developed a small business size standard for this category; that size 
standard is $7.0 million or less in average annual receipts. According 
to Census Bureau data for 2007, there were 367 firms in this category 
that operated for the entire year. Of these, 334 had annual receipts of 
under $5.0 million, and an additional 11 firms had receipts of between 
$5 million and $9,999,999. Consequently, we estimate that the majority 
of these firms are small entities that may be affected by our action.
4. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements
    119. The data, information and document collection required by this 
Report and Order falls into five general categories: market structure, 
pricing, demand (i.e., observed sales and purchases), terms and 
conditions, and competition and pricing decisions.
    120. Market structure data consists of, among other things, the 
situs and type of facilities owned by a provider (or leased subject to 
an indefeasible right of use) capable of providing special access, by 
sold and potential capacity and ownership, and the proximity of such 
facilities to sources of demand. We also require incumbent LEC 
providers to submit data concerning the number, nature, and situs of 
UNEs sold. In addition, we also require additional market structure 
data from competitive providers, such as detailed information related 
to non-price factors that may impact where special access providers 
build facilities or expand their network via UNEs and the history of 
their facility deployments in a sample of locations they serve.
    121. Pricing data includes the quantities sold and prices charged 
for special access services, by circuit element, and information 
regarding the regulatory environment for incumbent LECs.
    122. Demand data includes, among other things, data that identify 
the bandwidth of the special access services sold or purchased, the 
locations being served, and other material facts, such as where those 
purchases occur (e.g., buildings, cell towers) and the nature of the 
purchaser (e.g., provider or end user).
    123. Terms and conditions data and information include, but are not 
limited to, information regarding contracts or generally available 
plans for special access services that offer discounts, circuit 
portability, or other competitively relevant benefits, and whether the 
terms and conditions associated with those offerings may inhibit a 
buyer's ability to switch to other providers, which in turn may inhibit 
facilities-based entry into special access markets.
    124. Competition and pricing data, information and documents 
include, but are not limited to, those materials related to requests 
for proposals, advertising and marketing materials, and in very limited 
circumstances, pricing decision documents.
    125. Best efforts business broadband Internet access services 
include, but are not limited to, data showing where a provider or 
entity provides such services, as well as price lists.
    126. Questions related to terms and conditions, competition and 
pricing decisions will span a variety of timeframes specific to the 
issue addressed. The majority of the market structure, pricing and 
demand data will be collected for a two-year period. This period of 
time allows the analysis to control for factors that may vary 
substantially across geographic areas, but not within a given 
geographic area.
5. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered
    127. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its 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.
    128. Entities required to respond to this data request include all 
providers and purchasers of special access services as well as some 
entities that provide best efforts business broadband Internet access 
services. By ``providers,'' we mean any entity subject to the 
Commission's jurisdiction under the Communications Act, as amended, 
that provides special access services or provides a connection that is 
capable of providing special access services. By ``purchasers,'' we 
mean any entity subject to the Commission's jurisdiction under the 
Communications Act, as amended, that purchases special access services. 
Providers and purchasers may include price cap regulated incumbent 
LECs, competitive LECs, interexchange carriers, cable operators, and 
companies that provide fixed wireless communications services. Some 
entities that fall under the Commission's jurisdiction and provide best 
efforts broadband Internet access services, but fall outside our 
definitions of ``provider'' and ``purchaser,'' are also required to 
respond.
    129. Because the focus of this proceeding is on the regulation of 
special access services in price-cap territories, a rate-of-return 
carrier, which is not subject to our pricing flexibility rules, shall 
not be considered a ``provider'' to the extent it provides

[[Page 2588]]

special access within its rate-of-return service area. Likewise, we 
will not require data from any provider with regard to its operations 
in any geographic area in which a rate-of-return carrier is the 
incumbent. Moreover, we will not require a purchaser to produce data 
based on purchases it makes in those areas in which a rate-of-return 
carrier is the incumbent. If, however, a provider or purchaser prefers 
to provide data for all areas without distinguishing between areas 
served by price cap LECs and rate-of-return LECs, it may do so.
    130. Small business concerns were considered when determining the 
nature of the data to be collected, and identified data, information, 
and document requirements were modified to reduce burdens on small 
businesses where possible. The Wireline Competition Bureau previously 
issued two voluntary data requests in this proceeding. These voluntary 
requests allowed each potential respondent to make its own 
determination concerning participation. The responses to the voluntary 
data requests provided the Commission the means and opportunity to 
assess which data elements are most important to its ability to assess 
the special access market, and to eliminate or revise those questions 
that otherwise yield less valuable information. The voluntary data 
requests also allowed the Commission to carefully assess the need to 
obtain data from all providers and purchasers of special access 
services and certain other services--including small businesses--to 
conduct a comprehensive analysis of the special access market.
    131. In order to conduct a comprehensive analysis of the special 
access market, the Commission will collect data from all providers and 
purchasers of special access services as well as some entities that 
provide best efforts business broadband Internet access services. The 
Commission notes concerns regarding the burden that this data 
collection will impose on small companies, and is mindful of the 
importance of seeking to reduce information collection burdens for 
small business concerns, and in particular those ``with fewer than 25 
employees.'' Competition in the provision of special access, however, 
appears to occur at a very granular level--perhaps as low as the 
building/tower. Accordingly, the Commission finds it necessary to 
obtain data from special access providers and purchasers of all sizes.
    132. We structured the collection somewhat differently for best 
efforts and special access services to minimize the burden on 
submitters consistent with our data requirements and taking into 
consideration data that the Commission already has available to it. 
Because the record indicates that entities that provide best efforts 
business broadband Internet access services generally deliver those 
services throughout their footprint over the same network facilities 
they use to deliver mass market broadband Internet access, we need not 
collect this data at the same level of granularity as location and 
facilities data for special access. We also do not require entities 
with fewer than 15,000 customers and fewer than 1,500 business 
broadband customers to provide data regarding their best efforts 
business broadband Internet access services. Commenters assert that 
those entities incur the greatest burden when producing data for the 
State Broadband Initiative broadband mapping effort.
    133. Other modifications made by the Commission include: allowing a 
provider or purchaser to provide data for all areas without 
distinguishing between areas served by price cap LECs and rate-of-
return LECs; applying sampling methods where possible; limiting the 
market structure, pricing and demand data collection to a two-year 
period; and tailoring the timeframes for the terms and conditions, 
competition and pricing questions to the specific issue addressed. In 
addition, the Commission chose to limit the production of documents 
showing the internal analyses undertaken by providers in 2010 or 
thereafter to evaluate, inter alia, competitive market shares, changes 
in competition, changes in the costs of supplying services, whether to 
respond to RFPs, and identified rate increases and decreases to 
circumstances where the Wireline Competition Bureau determines the 
initial data collection was incomplete or insufficient for analysis.
    134. We note that this Report and Order does not change special 
access pricing regulation. We therefore do not consider the potential 
alternatives to special access pricing regulation that SBA asserted 
might minimize the impact on small competitive carriers.
6. Report to Congress
    The Commission will send a copy of the Report and Order, including 
this FRFA, in a report to be sent to Congress and the Government 
Accountability Office pursuant to the Small Business Regulatory 
Enforcement Fairness Act of 1996. In addition, the Commission will send 
a copy of the Order, including the FRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration. A copy of the Report and 
Order and FRFA (or summaries thereof) will also be published in the 
Federal Register.

D. Ex Parte Presentations

    135. The proceeding shall be treated as a ``permit-but-disclose'' 
proceeding in accordance with the Commission's ex parte rules. Persons 
making ex parte presentations must file a copy of any written 
presentation or a memorandum summarizing any oral presentation within 
two business days after the presentation (unless a different deadline 
applicable to the Sunshine period applies). Persons making oral ex 
parte presentations are reminded that memoranda summarizing the 
presentation must (1) list all persons attending or otherwise 
participating in the meeting at which the ex parte presentation was 
made, and (2) summarize all data presented and arguments made during 
the presentation. If the presentation consisted in whole or in part of 
the presentation of data or arguments already reflected in the 
presenter's written comments, memoranda or other filings in the 
proceeding, the presenter may provide citations to such data or 
arguments in his or her prior comments, memoranda, or other filings 
(specifying the relevant page and/or paragraph numbers where such data 
or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with Sec.  1.1206(b). In proceedings governed by 
Sec.  1.49(f) or for which the Commission has made available a method 
of electronic filing, written ex parte presentations and memoranda 
summarizing oral ex parte presentations, and all attachments thereto, 
must be filed through the electronic comment filing system available 
for that proceeding, and must be filed in their native format (e.g., 
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding 
should familiarize themselves with the Commission's ex parte rules.

V. Mandatory Data Collection

I. Definitions

    The following definitions apply for purposes of this collection 
only. They are not intended to set or modify precedent outside the 
context of this collection.
    Affiliated Company means a company, partnership, corporation, 
limited liability company, or other business entity that is affiliated 
with a Provider. An entity and a Provider are

[[Page 2589]]

affiliated if one of them, or an entity that controls one of them, 
directly or indirectly holds a greater than 25 percent ownership 
interest in, or controls, the other one.
    Best Efforts Business Broadband Internet Access Service means a 
best efforts Internet access data service with a capacity equal to or 
greater than a DS1 connection that is marketed to enterprise customers 
(including small, medium, and large businesses). For purposes of this 
data collection, Best Efforts Business Broadband Internet Access 
Services do not include mobile wireless services, as that term is used 
in the 15th Annual Mobile Wireless Competition Report.
    Circuit-Based Dedicated Service (CBDS) means a Dedicated Service 
that is circuit-based. Examples of CBDS include DS1 and DS3 services 
and Synchronous Optical Networking (SONET)/Optical Carrier N (OCN) 
services, including point-to-point and ring services.
    Collocation is an offering by an ILEC whereby a requesting 
Competitive Provider's transmission equipment is located, for a 
tariffed charge, at the ILEC's central office. It refers to the term as 
used pursuant to 47 CFR 69.701 et seq. of the Commission's rules for 
purposes of applying for a grant of Phase I or Phase II Pricing 
Flexibility from the Commission. The definition of Collocation excludes 
Competitive Providers that collocate in carrier hotels.
    Competitive Provider means a competitive local exchange carrier 
(CLEC), interexchange carrier, cable operator, wireless provider or any 
other entity that is subject to the Commission's jurisdiction under the 
Communications Act of 1934, as amended, and either provides a Dedicated 
Service or provides a Connection over which a Dedicated Service could 
be provided. A Competitive Provider does not include an ILEC operating 
within its incumbent service territory.
    Connection means a wired ``line'' or wireless ``channel'' that 
provides a dedicated communication path between an End User's Location 
and the first Node on a Provider's network. Multiple dedicated 
communication paths serving one or more End Users at the same Location 
should be counted as a single Connection. A Connection may be a UNE, 
including an Unbundled Copper Loop. A Connection must have the 
capability of being used to provide one or more Dedicated Services; 
however, a Connection can be used to provide other services as well. 
For example, a dedicated communication path that is currently being 
used to provide a mass market broadband service but has the capability 
to provide a Dedicated Service is considered a Connection for the 
purpose of this data collection.
    Contract-Based Tariff means a Tariff, other than a Tariff Plan, 
that is based on a service contract entered into between a customer and 
an ILEC which has obtained permission to offer contract-based tariff 
services pursuant to 47 CFR 69.701 et seq. of the Commission's pricing 
flexibility rules or a comparable tariffed intrastate service contract 
between a customer and an ILEC.
    Dedicated Service transports data between two or more designated 
points, e.g., between an End User's premises and a point-of-presence, 
between the central office of a local exchange carrier (LEC) and a 
point-of-presence, or between two End User premises, at a rate of at 
least 1.5 megabytes per second (Mbps) with prescribed performance 
requirements that include bandwidth-, latency-, or error-rate 
guarantees or other parameters that define delivery under a Tariff or 
in a service-level agreement. Dedicated Service includes, but is not 
limited to, CBDS and PBDS. For the purpose of this data collection, 
Dedicated Service does not include ``best effort'' services, e.g., mass 
market broadband services such as DSL and cable modem broadband access.
    Disconnection means the process by which a Provider, per a customer 
request, terminates billing on one or more of a customer's Dedicated 
Service circuits.
    DS1 and DS3, except where specified, refer to DS1s and DS3s that 
are not UNEs. DS1s and DS3s are Dedicated Services.
    End User means a business, institutional, or government entity that 
purchases Dedicated Service for its own purposes and does not resell 
such service. A mobile wireless service provider is considered an End 
User when it purchases Dedicated Service to make connections within its 
own network, e.g., backhaul to a cell site.
    End User Channel Termination means, as defined in 47 CFR 
69.703(a)(2), a dedicated channel connecting a LEC end office and a 
customer premises, offered for purposes of carrying special access 
traffic.
    Incumbent Local Exchange Carrier (ILEC) means, for the purpose of 
this data collection, a LEC that provides a Dedicated Service in study 
areas where it is subject to price cap regulation under sections 61.41-
61.49 of the Commission's rules, 47 CFR 64.41-61.49.
    Indefeasible Right of Use (IRU) means an indefeasible long-term 
leasehold interest that gives the grantee the right to exclusively use 
specified strands of fiber or allocated bandwidth to provide a service 
as determined by the grantee. An IRU confers on the grantee 
substantially all of the risks and rewards of ownership for the 
estimated economic life of the asset. IRUs typically include the 
following elements: (i) Payment of a substantial fee up front to enter 
into the IRU contract; (ii) a minimum total duration of 10 years; (iii) 
conveyance of tax obligations commensurate with the risks and rewards 
of ownership to the grantee (e.g. as opposed to the lesser tax burdens 
associated with other forms of leases); (iv) terms for payment to the 
grantor for ancillary services, such as maintenance fees; (v) all 
additional rights and interests necessary to enable the IRU to be used 
by the grantee in the manner agreed to; and (vi) no unreasonable limit 
on the right of the grantee to use the asset as it wishes (e.g., the 
grantee shall be permitted to splice into the IRU fiber, though such 
splice points must be mutually agreed upon by grantor and the grantee 
of the IRU).
    Location means a building, other man-made structure, a cell site on 
a building, a free-standing cell site, or a cell site on some other 
man-made structure where the End User is connected. A Node is not a 
Location. For the purposes of this data collection, cell sites are to 
be treated as Locations and not as Nodes.
    Metropolitan Statistical Area (MSA) is a geographic area as defined 
by 47 CFR 22.909(a), 69.703(b).
    Node is an aggregation point, a branch point, or a point of 
interconnection on a Provider's network, including a point of 
interconnection to other Provider networks. Examples include LEC 
central offices, remote terminal locations, splice points (including, 
for example, at manholes), controlled environmental vaults, cable 
system headends, cable modem termination system (CMTS) locations, and 
facility hubs.
    Non-MSA is the portion of an ILEC's study area that falls outside 
the boundaries of an MSA.
    Non-Rate Benefit means a benefit to the customer other than a 
discount on the One Month Term Only Rate, e.g., a credit towards 
penalties or non-recurring charges or the ability to move circuits 
without incurring a penalty.
    One Month Term Only Rate means, for purposes of this data 
collection, the non-discounted monthly recurring tariffed rate for DS1, 
DS3 and/or PBDS services.
    Packet-Based Dedicated Service (PBDS) means a Dedicated Service 
that is packet-based. Examples of PBDS include Multi-Protocol Label 
Switched

[[Page 2590]]

(MPLS) services; permanent virtual circuits, virtual private lines and 
similar services provided using ATM, Frame Relay and other packet 
technologies; (Gigabit) Ethernet Services and Metro Ethernet Virtual 
Connections; and Virtual Private Networks (VPN).
    Phase I Pricing Flexibility means regulatory relief for the pricing 
of End User Channel Terminations pursuant to 47 CFR 69.711(b), 
69.727(a) of the Commission's rules.
    Phase II Pricing Flexibility means regulatory relief for the 
pricing of End User Channel Terminations pursuant to 47 CFR 69.711(c), 
69.727(b) of the Commission's rules.
    Prior Purchase-Based Commitment means a type of Volume Commitment 
where the commitment is based on either:
    (i) a certain percentage or number of the customer's purchased in-
service circuits or lines as measured at the time of making the Volume 
Commitment or measured during a period of time prior to making the 
Volume Commitment, e.g., based on the customer's billing records for 
the current month or prior month(s); or
    (ii) a certain percentage of Revenues generated by the customer's 
purchases as measured at the time of making the Volume Commitment or 
during a period of time prior to making the Volume Commitment.
    Providers collectively refers to both ILECs and Competitive 
Providers.
    Purchasers means Competitive Providers and End Users that are 
subject to the Commission's jurisdiction under the Communications Act 
of 1934, as amended, and purchase Dedicated Service.
    Revenues means intrastate and interstate billed amounts without any 
allowance for uncollectibles, commissions or settlements. Revenues do 
not include billed amounts that are subsequently discounted by the 
Provider, e.g., customer rebates.
    Tariff means an intrastate or interstate schedule of rates and 
regulations filed by common carriers.
    Tariff Plan means a Tariff, other than a Contract-Based Tariff, 
that provides a customer with either a discount from any One Month Term 
Only Rate for the purchase of DS1 and/or DS3 services or a Non-Rate 
Benefit that could be applied to these services.
    Term Commitment means a commitment to purchase a Dedicated Service 
for a period of time, greater than a month, in exchange for a circuit-
specific discount and/or a Non-Rate Benefit.
    Transport Service means dedicated transport and includes the 
services set forth in 47 CFR 69.709(a)(1)-(3).
    Transport Provider means a Provider that supplies Transport 
Service.
    Unbundled Copper Loop means a copper wire local loop provided by 
ILECs to requesting telecommunications carriers on a non-discriminatory 
basis pursuant to 47 CFR 51.319(a)(1) that can be used by a Competitive 
Provider to provide a Dedicated Service, e.g., Ethernet over Copper. An 
Unbundled Copper Loop is typically a 2- or 4-wire loop that the ILEC 
has conditioned to remove intervening equipment such as bridge taps, 
load coils, repeaters, low pass filters, range extenders, etc. between 
the End User's Location and the serving wire center to allow for the 
provision of advanced digital services by a Competitive Provider. These 
loops are commonly referred to as dry copper, bare copper, or xDSL-
compatible loops. An Unbundled Copper Loop is a type of UNE.
    Unbundled Network Element (UNE) means a local loop provided by an 
ILEC to a requesting telecommunications carrier on a non-discriminatory 
basis pursuant to 47 CFR 51.319(a).
    Upgrade means that a customer transitions one or more circuits to a 
higher capacity circuit.
    Volume Commitment means a commitment to purchase a specified 
volume, e.g., a certain number of circuits or Revenues, to receive a 
discount on Dedicated Services and/or a Non-Rate Benefit.

II. Mandatory Data Collection Questions

    A. Competitive Providers must respond to the following questions:
    1. Are you an Affiliated Company?
    [ballot] Yes
    [ballot] No
    a. If so, identify the Provider(s) with whom you have an 
affiliation (name/FRN).
    2. Do you (i) own a Connection; (ii) lease a Connection from 
another entity under an IRU agreement; or (iii) obtain a Connection as 
a UNE from an ILEC to provide a Dedicated Service?
    [ballot] Yes
    [ballot] No
    a. If yes, are any of these Connections to a Location within an 
area subject to price cap regulation or within an area where the 
Commission has granted Phase I or Phase II Pricing Flexibility?
    [ballot] Yes
    [ballot] No
    If you answered ``no'' to question II.A.2 or II.A.2.a, then you are 
not required to respond to the remaining questions in II.A or the 
questions in II.D.
Facilities Information
    3. Provide the number of Locations to which you provided a 
Connection as of December 31, 2010 and as of December 31, 2012 where 
your company:
    a. Owns the Connection;
    b. Leases the Connection from another entity under an IRU 
agreement; or
    c. Obtains the Connection as a UNE from an ILEC to provide a 
Dedicated Service:
    i. In total;
    ii. In the form of DS1s;
    iii. As a DS3; or
    iv. As an Unbundled Copper Loop.
    4. Provide the information requested below for each Location as of 
December 31, 2010 and as of December 31, 2012 to which your company 
provided a Connection that you: (i) own; (ii) lease from another entity 
under an IRU agreement; or (iii) obtained as a UNE from an ILEC to 
provide a Dedicated Service.
    a. A unique ID for the Location;
    b. The actual situs address for the Location (i.e., land where the 
building or cell site is located);
    c. The geocode for the Location (i.e., latitude and longitude);
    d. The Location type (e.g., building, other man-made structure, 
cell site in or on a building, free-standing cell site, or a cell site 
on some other man-made structure like a water tower, billboard, etc.);
    e. Whether the Connection provided to the location uses facilities 
leased from another entity under an IRU or obtained as a DS1/DS3 UNE or 
Unbundled Copper Loop, and in each case, the name of the lessor of the 
majority of the fiber strands and/or copper loop;
    f. Whether any of the Connections to the location are provided 
using fiber;
    g. The total sold bandwidth of all Connections provided by you to 
the Location in Mbps;
    h. The total bandwidth to the Location sold directly by you to an 
End User;
    i. The total sold fixed wireless bandwidth provided by you to the 
Location; and
    j. The total bandwidth sold by you to any cell sites at the 
Location.
    5. Provide a map of the routes that constitute your network that 
are followed by fiber that you (a) own or (b) lease pursuant to an IRU 
agreement, excluding routes followed by fiber that you own or lease 
pursuant to an IRU agreement connecting your network to End User 
Locations. The map must include the locations of all Nodes on your 
network used to interconnect with third party networks, and the year 
that

[[Page 2591]]

each Node went live. Also, provide a separate map of the routes 
followed by fiber that you (a) own or (b) lease pursuant to an IRU 
agreement that connect your network to End User Locations.
    6. We will provide you with a selected list of the Locations you 
reported in response to question II.A.4. For each identified Location, 
state the month and year that you first provided a Connection to that 
Location, whether you originally supplied the Location over a UNE, and 
if so, when (if at all) you switched to using a Connection that you own 
or lease as an IRU. If the Location was first served by your Connection 
on or before January 2008, and the date the Location was first served 
is unknown, then enter 00/0000.
    7. For each ILEC wire center where your company is collocated, 
provide the actual situs address, the geocode, and the CLLI code.
    8. Explain your business rule(s) used to determine whether to build 
a Connection to a particular Location. Provide underlying assumptions.
    a. List those geographic areas in which you have built the most 
Connections to End Users and explain why, in your view, your business 
rule has been most successful in those areas.
    b. Explain how, if at all, business density is incorporated into 
your business rule, and if so, how you measure business density.
    9. Provide the following information:
    a. The current situs address of your U.S. headquarters (i.e., the 
address of the land where the headquarters is located);
    b. The year that this site became your headquarters;
    c. Year established and situs address for any prior U.S. 
headquarters' location for your company, going as far back as 1995, if 
different from the headquarters' location listed in response to 
question II.A.9.a;
    d. The name of any Affiliated Company that owned, or leased under 
an IRU agreement, Connections to five or more Locations in any MSA at 
the time you became affiliated with the Affiliated Company, going as 
far back as 1995.
    e. For each Affiliated Company listed in response to question 
II.A.9.d, provide:
    i. The situs address for each Affiliated Company's U.S. 
headquarters at the time of affiliation;
    ii. The year that the Affiliated Company established the situs 
address listed in response to question II.A.9.e.i for its U.S. 
headquarters; and
    iii. The year established and situs address for any prior U.S. 
headquarters' location designated by the Affiliated Company, going as 
far back as 1995, if different from the headquarters' location listed 
in response to question II.A.9.e.i.
    10. Provide data, maps, information, marketing materials, and/or 
documents identifying those geographic areas where you, or an 
Affiliated Company, advertised or marketed Dedicated Service over 
existing facilities, via leased facilities, or by building out new 
facilities as of December 31, 2010 and as of December 31, 2012, or 
planned to advertise or market such services within twenty-four months 
of those dates.
    11. Identify the five most recent Requests for Proposals (RFPs) for 
which you were selected as the winning bidder to provide each of the 
following: (a) Dedicated Services; (b) Best Efforts Business Broadband 
Internet Access Services; and, to the extent different from (a) or (b), 
(c) some other form of high-capacity data services to business 
customers. In addition, identify the five largest RFPs (by number of 
connections) for which you submitted an unsuccessful competitive bid 
between 2010 and 2012 for each of (a) Dedicated Services; (b) Best 
Efforts Business Broadband Internet Access Services; and, to the extent 
different from (a) or (b), (c) some other form of high-capacity data 
services to business customers. For each RFP identified, provide a 
description of the RFP, the area covered, the price offered, and other 
competitively relevant information. Lastly, identify the business rules 
you rely upon to determine whether to submit a bid in response to an 
RFP.
Billing Information
    12. For all Dedicated Services provided using transmission paths 
that you (i) own; (ii) lease from another entity under an IRU 
agreement; or (iii) obtain as a UNE from an ILEC to provide a Dedicated 
Service, submit the following information by rate element by circuit 
billed for each month from January 1 to December 31 for the years 2010 
and 2012.
    a. The closing date of the monthly billing cycle in dd/mm/yyyy 
format;
    b. The six-digit 499-A Filer ID of the customer, where applicable, 
or other unique ID if customer does not have a 499-A Filer ID;
    c. The Location ID from question II.A.4.a that can be used to link 
the circuit rate elements to the terminating Location of the circuit 
(where applicable);
    d. The circuit ID common to all elements purchased in common for a 
particular circuit;
    e. The type of circuit (PBDS, or DS1 or DS3, etc.) and its 
bandwidth;
    f. A unique billing code for the rate element (see question 
II.A.14);
    g. The number of units billed for this rate element (note that the 
bandwidth of the circuit must not be entered here);
    h. The dollar amount of non-recurring charges billed for the first 
unit of this rate element;
    i. The dollar amount of non-recurring charges billed for additional 
units of this rate element (if different from the amount billed for the 
initial unit);
    j. The monthly recurring dollar charge for the first unit of the 
rate element billed;
    k. The monthly recurring dollar charge for additional units (if 
different from the amount billed for the initial unit);
    l. The total monthly dollar amount billed for the rate element 
billed in the month;
    m. The Term Commitment associated with this circuit in months;
    n. Indicate whether this rate element is associated with a circuit 
that contributes to a Volume Commitment;
    o. Indicate whether the circuit element is owned by you or leased 
by you as an IRU but not as a UNE; and
    p. The adjustment ID (or multiple adjustment IDs) linking this rate 
element to the unique out-of-cycle billing adjustments in question 
II.A.13.a (below) if applicable.
    13. For each adjustment, rebate, or true-up for billed Dedicated 
Services, provide the information requested below.
    a. A unique ID number for the billing adjustment, rebate, or true-
up (see question II.A.12.p above);
    b. The beginning date of the time period covered by the adjustment 
or true-up;
    c. The ending date of the time period covered by the adjustment or 
true-up;
    d. The scope of the billing adjustment, i.e., whether the 
adjustment applies to a single rate element on a single circuit, more 
than one rate element on a single circuit, more than one rate element 
across multiple circuits, or an overall adjustment that applies to 
every rate element on every circuit purchased by the customer;
    e. The dollar amount of the adjustment or true-up; and
    f. A brief description of the billing adjustment, rebate or true-
up, e.g., term discount, revenue target rebate, etc.
    14. For each unique billing code, please provide the following 
information below.
    a. The billing code for the rate element;
    b. Select the phrase that best describes the rate element from the 
list. Names of some common rate elements are shown

[[Page 2592]]

on the generalized circuit diagram below:
[GRAPHIC] [TIFF OMITTED] TR11JA13.010

    i. Channel mileage facility, channel mileage, interoffice channel 
mileage, special transport (a transmission path between two serving 
wire centers associated with customer designated locations; a serving 
wire center and an international or service area boundary point; a 
serving wire center and a hub, or similar type of connection);
    ii. Channel mileage termination, special transport termination (the 
termination of channel mileage facility or similar transmission path);
    iii. Channel termination, local distribution channel, special 
access line, customer port connection (Ethernet) (a transmission path 
between a customer designated location and the associated wire center);
    iv. Clear channel capability (not shown) (an arrangement which 
allows a customer to transport, for example, 1.536 Mbps of information 
on a 1.544 Mbps line rate with no constraint on the quantity or 
sequence of one and zero bits);
    v. Cross-connection (not shown) (semi-permanent switching between 
facilities, sometimes combined with multiplexing/demultiplexing);
    vi. Multiplexing (not shown) (channelizing a facility into 
individual services requiring a Lower capacity or bandwidth); and
    vii. Class of service and/or committed information rate (not shown) 
(for Ethernet, the performance characteristics of the network and 
bandwidth available for a customer port connection).
    c. If none of the possible entries describes the rate element, 
enter a short description.
Revenues, Terms and Conditions
    15. What were your Revenues from the sale of CBDS in 2010 and 2012? 
For each year, report Revenues in total, separately by DS1, DS3, and 
other CBDS sales, and separately by customer category, i.e., sales to 
Providers and End Users.
    16. What were your Revenues from the sale of PBDS in 2010 and 2012? 
For each year, report Revenues in total, separately by customer 
category, i.e., sales to Providers and End Users, and separately by 
bandwidth for the following categories:
    a. less than or equal to 1.5 Mbps;
    b. greater than 1.5, but less than or equal to 50 Mbps;
    c. greater than 50, but less than or equal to 100 Mbps;
    d. greater than 100, but less than or equal to 1 Gbps; and
    e. greater than 1 Gbps.
    17. What percentage of your Revenues from the sale of DS1, DS3, and 
PBDS services in 2012 were generated from an agreement or Tariff that 
contains a Prior Purchase-Based Commitment?
    18. If you offer Dedicated Services pursuant to an agreement or 
Tariff that contains either a Prior Purchase-Based Commitment or a Non-
Rate Benefit, then explain how, if at all, those sales are 
distinguishable from similarly structured ILEC sales of DS1s, DS3s, 
and/or PBDS.
    19. Provide the business justification for the Term or Volume 
Commitments associated with any Tariff or agreement you offer for the 
sale of Dedicated Services.
    B. ILECs must respond to the following questions:
    1. Are you an Affiliated Company?
    [ballot] Yes
    [ballot] No
    a. If so, identify the Provider(s) with whom you have an 
affiliation (name/FRN).
Facilities Information
    2. Provide the number of Locations to which you provided a 
Connection in your company study areas as of December 31, 2010 and as 
of December 31, 2012 where your company:
    a. owns the Connection;
    b. leases the Connection from another entity under an IRU 
agreement; or
    c. sells the Connection as a UNE:
    i. in total;
    ii. in the form of DS1s;
    iii. as a DS3; or
    iv. as an Unbundled Copper Loop.
    3. Provide the information requested below for each Location to 
which your company provided, as of December 31, 2010 and as of December 
31, 2012, a Connection that you (i) own or (ii) you lease from another 
entity under an IRU agreement:
    a. A unique ID for the Location;
    b. The actual situs address for the Location (i.e., land where the 
building or cell site is located);
    c. The geocode for the Location (i.e., latitude and longitude);
    d. The Location type (e.g., building, other man-made structure, 
cell site in or on a building, free-standing cell site, or a cell site 
on some other man-made structure like a water tower, billboard, etc.);
    e. Whether any of the Connections to the Location are provided 
using fiber;
    f. The total sold bandwidth of all Connections provided by you to 
the Location in Mbps (exclude connections sold without a specified 
bandwidth, e.g., Unbundled Copper Loops);
    g. The total number of Unbundled Copper Loops sold by you to the 
Location;
    h. The total bandwidth to the Location sold by you as UNEs in the 
form of DS1s and/or DS3s;
    i. The total bandwidth to the Location sold directly by you to an 
End User;
    j. The total sold fixed wireless bandwidth provided by you to the 
Location; and
    k. The total bandwidth sold by you to any cell sites at the 
Location.
Billing Information
    4. For all Dedicated Services provided using transmission paths 
that you (i) own or (ii) lease from another entity under an IRU 
agreement and for Unbundled Copper Loops that you own and provision, 
submit the following information by rate element by circuit

[[Page 2593]]

billed for each month from January 1 to December 31 for the years 2010 
and 2012.
    a. The closing date of the monthly billing cycle in dd/mm/yyyy 
format;
    b. The six-digit 499A Filer ID of the customer, where applicable, 
or other unique ID if customer does not have a 499A Filer ID;
    c. The Location ID from question II.B.3.a that can be used to link 
the circuit rate elements to the terminating Location of the circuit 
(where applicable);
    d. The circuit ID common to all elements purchased in common for a 
particular circuit;
    e. The type of circuit, (DS1 sold as a UNE, DS3 sold as a UNE, 
Unbundled Copper Loop,  PBDS, non-UNE DS1s or DS3s, etc.) and the 
bandwidth of the circuit;
    f. The serving wire center/mileage rating point Common Language 
Location Identification (CLLI) of one end of the circuit (MRP1);
    g. The serving wire center/mileage rating point CLLI of the other 
end of the circuit (MRP2);
    h. The latitude of MRP1 to 5 decimal places;
    i. The longitude of MRP1 to 5 decimal places;
    j. The latitude of MRP2 to 5 decimal places;
    k. The longitude of MRP2 to 5 decimal places;
    l. End of the circuit (1-MRP1 or 2-MRP2) associated with this rate 
element;
    m. The billing code for the rate element (see question II.B.6);
    n. The density pricing zone for the rate element;
    o. The number of units billed for this rate element (note that the 
bandwidth of the circuit must not be entered here);
    p. The dollar amount of non-recurring charges billed for the first 
unit of this rate element;
    q. The dollar amount of non-recurring charges billed for additional 
units of this rate element (if different from the amount billed for the 
initial unit);
    r. The monthly recurring dollar charge for the first unit of the 
rate element billed;
    s. The monthly recurring dollar charge for additional units (if 
different from the amount billed for the initial unit);
    t. The total monthly dollar amount billed for the rate element;
    u. The Term Commitment associated with this circuit in months;
    v. Indicate whether this rate element is associated with a circuit 
that contributes to a Volume Commitment;
    w. Indicate whether this rate element is associated with a circuit 
that contributes to a revenue commitment in a Tariff Plan;
    x. Indicate whether this rate element was purchased pursuant to a 
Contract-Based Tariff;
    y. Indicate whether the circuit element is owned by you or leased 
by you as an IRU;
    z. The adjustment ID (or multiple adjustment IDs) linking this rate 
element to the unique out-of-cycle billing adjustments in question 
II.B.5.a (below) if applicable; and
    aa. If the rate element is sold under a Tariff, list the Tariff 
name.
    5. For each adjustment, rebate, or true-up for billed Dedicated 
Services, provide the information requested below.
    a. A unique ID for the billing adjustment or true-up (see question 
II.B.4.z above);
    b. A unique ID number for the contract or Tariff from which the 
adjustment originates;
    c. The beginning date of the time period covered by the adjustment 
or true-up;
    d. The ending date of the time period covered by the adjustment or 
true-up;
    e. The scope of the billing adjustment, i.e., whether the 
adjustment applies to a single rate element on a single circuit, more 
than one rate element on a single circuit, more than one rate element 
across multiple circuits, or an overall adjustment that applies to 
every rate element on every circuit purchased by the customer;
    f. The dollar amount of the adjustment or true-up;
    g. Whether the adjustment is associated with a Term Commitment, and 
if so, the length of the term specified in the contract necessary to 
achieve the rebate;
    h. Whether the adjustment is associated with a Volume Commitment, 
and if so, the number of circuits and/or dollar amount specified in the 
contract necessary to achieve the rebate; and
    i. If the adjustment is for some other reason, a brief description 
of the reason for the adjustment.
    6. For each unique billing code, please provide the following 
information below.
    a. The billing code for the rate element;
    b. The phrase that best describes the rate element from the list. 
Names of some common rate elements are shown on the generalized circuit 
diagram below:
[GRAPHIC] [TIFF OMITTED] TR11JA13.011

    i. Channel mileage facility, channel mileage, interoffice channel 
mileage, special transport (a transmission path between two serving 
wire centers associated with customer designated locations; a serving 
wire center and an international or service area boundary point; a 
serving wire center and a hub, or similar type of connection);
    ii. Channel mileage termination, special transport termination (the 
termination of channel mileage facility or similar transmission path);
    iii. Channel termination, local distribution channel, special 
access line, customer port connection (Ethernet) (a transmission path 
between a customer designated location and the associated wire center);
    iv. Clear channel capability (not shown) (an arrangement which 
allows a customer to transport, for example, 1.536 Mbps of information 
on a 1.544

[[Page 2594]]

Mbps line rate with no constraint on the quantity or sequence of one 
and zero bits);
    v. Cross-connection (not shown) (semi-permanent switching between 
facilities, sometimes combined with multiplexing/demultiplexing);
    vi. Multiplexing (not shown) (channelizing a facility into 
individual services requiring a Lower capacity or bandwidth); and
    vii. Class of service and/or committed information rate (not shown) 
(for Ethernet, the performance characteristics of the network and 
bandwidth available for a customer port connection).
    c. If none of the possible entries describes the rate element, 
enter a short description.
    7. List the CLLI code for each one of your wire centers that was 
subject to price cap regulation as of December 31, 2010 and as of 
December 31, 2012, i.e., those wire centers in your incumbent territory 
where the Commission had not granted you pricing flexibility. For those 
MSAs and Non-MSAs where the Commission granted you Phase I or Phase II 
Pricing Flexibility as of December 31, 2010 and as of December 31, 
2012, list the CLLI codes for the wire centers associated with each MSA 
and Non-MSA for each year, the name of the relevant MSA and Non-MSA for 
each year, and the level of pricing flexibility granted for the MSA and 
Non-MSA, i.e., Phase I and/or Phase II Pricing Flexibility.
Revenues, Terms and Conditions Information
    8. What were your Revenues from the sale of CBDS services in 2010 
and 2012? For each year, report Revenues in total, separately by DS1, 
DS3, and other CBDS sales, and separately by customer category, i.e., 
sales to Competitive Providers and End Users.
    9. What were your Revenues from the sale of PBDS services in 2010 
and 2012? For each year, report Revenues in total, separately by 
customer category, i.e., sales to Competitive Providers and End Users, 
and separately by bandwidth for the following categories:
    a. Less than or equal to 1.5 Mbps;
    b. Greater than 1.5, but less than or equal to 50 Mbps;
    c. Greater than 50, but less than or equal to 100 Mbps;
    d. Greater than 100, but less than or equal to 1 gigabyte per 
second (Gbps); and
    e. Greater than 1 Gbps.
    10. What were your Revenues from the One Month Term Only Rate 
charged for DS1, DS3, and/or PBDS services in 2010 and 2012? For each 
year, report Revenues in total, separately by DS1, DS3, and PBDS sales 
as applicable, and separately by customer category, i.e., sales to 
Competitive Providers and End Users.
    11. How many customers were purchasing DS1, DS3, and/or PBDS 
services pursuant to your One Month Term Only Rates as of December 31, 
2012? Report customer numbers in total, separately for DS1, DS3, and 
PBDS services as applicable, and separately by customer category, i.e., 
the number of DS1, DS3, and PBDS service customers that were 
Competitive Providers and End Users.
    12. Separately list all available Tariff Plans and Contract-Based 
Tariffs that can be applied to the purchase of DS1, DS3 and/or PBDS 
services and provide the information requested below for each plan.
    a. This plan is a:
    [ballot] Tariff Plan
    [ballot] Contract-Based Tariff (select one)
    b. Plan name:
    c. Tariff and Section Number(s):
    d. This plan contains:
    [ballot] Term Commitment(s)
    [ballot] Volume Commitment(s)
    [ballot] Non-Rate Benefit option(s) (select all that apply)
    e. If the plan contains options for Non-Rate Benefits, explain of 
the available Non-Rate Benefits.
    f. This plan can be applied to the purchase of:
    [ballot] DS1 services
    [ballot] DS3 services
    [ballot] PBDS
    [ballot] Other (select all that apply)
    g. In what geographic areas is this plan available, e.g., 
nationwide, a particular region of the country, certain states, certain 
MSAs, a particular study area?
    h. To receive a discount or Non-Rate Benefit under this plan, must 
the customer make a Prior Purchase-Based Commitment?
    [ballot] Yes
    [ballot] No
    i. Do purchases of DS1 or DS3 services in areas outside of your 
price cap study area(s) (e.g., purchases from an Affiliated Company 
that is a CLEC) count towards meeting any Volume Commitment to receive 
a discount or Non-Rate Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment)
    j. Do DS1 or DS3 purchases in areas where you are subject to price 
cap regulation and where pricing flexibility has not been granted count 
towards meeting any Volume Commitment to receive a discount or Non-Rate 
Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment)
    k. Do non-tariffed PBDS purchases by the customer count towards 
meeting any Volume Commitment to receive a discount or Non-Rate Benefit 
under this plan?
    [ballot] Yes
    [ballot]
    No [ballot] N/A (no Volume Commitment)
    l. Do purchases by the customer for services other than DS1s, DS3s, 
and PBDS count towards meeting any Volume Commitment to receive a 
discount or Non-Rate Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment)
    m. Is the discount or Non-Rate Benefit available under this plan 
conditioned on the customer limiting its purchase of UNEs, e.g., 
customer must keep its purchase of UNEs below a certain percentage of 
the customer's total spend?
    [ballot] Yes
    [ballot] No
    n. What were your Revenues from the provision of DS1, DS3, and/or 
PBDS services under this plan in 2010 and in 2012? For each year, 
report Revenues in total, separately by DS1, DS3, and PBDS sales as 
applicable, and separately by customer category, i.e., sales to 
Competitive Providers and End Users.
    o. What percentage of the Revenues reported above in response to 
question II.B.12.n for 2010 and 2012 were generated and also reported 
as Revenues under a separately identified Tariff Plan or Contract-Based 
Tariff?
    p. What percentage of the Revenues generated by this plan in 2012 
resulted from a Term Commitment of five or more years?
    q. What is the business justification for any Term or Volume 
Commitments associated with this plan?
    r. How many customers were subscribed to this plan as of December 
31, 2012? Report customer numbers in total, separately for DS1, DS3, 
and PBDS services as applicable, and separately by customer category, 
i.e., the number of DS1, DS3, and/or PBDS customers that were 
Competitive Providers and End Users.
    s. Of those customers subscribed as of December 31, 2012, how many 
in 2012 failed to meet any Volume Commitment or Term Commitment 
required to retain a discount or Non-Rate Benefit they originally 
agreed to when entering into this plan?
    13. Do you have any non-tariffed agreement with an End User or 
Competitive Provider that, directly or

[[Page 2595]]

indirectly, provides a discount or a Non-Rate Benefit on the purchase 
of tariffed DS1s, DS3s, and/or PBDS, restricts the ability of the End 
User or Competitive Provider to obtain UNEs, or negatively affects the 
ability of the End User or Competitive Provider to purchase Dedicated 
Services?
    [ballot] Yes
    [ballot] No
    a. If so, identify each agreement below, including the parties to 
the agreements, the effective date, and a summary of the relevant 
provisions.
    C. Entities that provide Best Efforts Business Broadband Internet 
Access Services must respond to the following questions:
    1. Do you have fewer than 15,000 customers and fewer than 1,500 
business broadband customers?
    [ballot] Yes
    [ballot] No
    2. If you answered ``no'' to question II.C.1, then answer the 
following questions:
    a. Did you submit data in connection with the State Broadband 
Initiative (SBI) Grant Program for 2010?
    [ballot] Yes
    [ballot] No
    b. Did you submit data in connection with the SBI Grant Program for 
2012?
    [ballot] Yes
    [ballot] No
    If you answered ``no'' to questions II.C.1.a and II.C.1.b, then you 
do not need to answer any further questions in this section.
    c. Did the data you submitted in connection with the SBI Grant 
Program in 2010 accurately and completely identify the areas in which 
you offered Best Efforts Business Broadband Internet Access Services 
and exclude those areas where you did not offer such services as of 
December 31, 2010?
    [ballot] Yes
    [ballot] No
    i. If yes, then provide the list of prices for those Best Efforts 
Business Broadband Internet Access Services that you were marketing in 
each census block submitted in connection with the SBI Grant Program as 
of December 31, 2010. If there is a price variation within your service 
footprint, indicate which prices are associated with which census 
blocks.
    ii. If no, then provide a list of all the census blocks in which 
you were providing Best Efforts Business Broadband Internet Access 
Services as of December 31, 2010, and a list of the prices for those 
Best Efforts Business Broadband Internet Access Services that you were 
marketing in each census block as of December 31, 2010. If there is a 
price variation within your service footprint, indicate which prices 
are associated with which census blocks.
    d. Did the data you submitted in connection with the SBI Grant 
Program in 2012 accurately and completely identify the areas in which 
you offered Best Efforts Business Broadband Internet Access Services 
and exclude those areas where you did not offer such services as of 
December 31, 2012?
    [ballot] Yes
    [ballot] No
    i. If yes, then provide the list of prices for those Best Efforts 
Business Broadband Internet Access Services that you were marketing in 
each census block submitted in connection with the SBI Grant Program as 
of December 31, 2012. If there is a price variation within your service 
footprint, indicate which prices are associated with which census 
blocks.
    ii. If no, then provide a list of all the census blocks in which 
you were providing Best Efforts Business Broadband Internet Access 
Services as of December 31, 2012, and a list of the prices for those 
Best Efforts Business Broadband Internet Access Services that you were 
marketing in each census block as of December 31, 2012. If there is a 
price variation within your service footprint, indicate which prices 
are associated with which census blocks.
    D. All Providers must respond to the following questions:
    1. Describe your company's short term and long-range promotional 
and advertising strategies and objectives for winning new--or retaining 
current--customers for Dedicated Services. In your description, please 
describe the size (e.g., companies with 500 employees or less, etc.), 
geographic scope (e.g., national, southeast, Chicago, etc.), and type 
of customers your company targets or plans to target through these 
strategies.
    2. Identify where your company's policies are recorded on the 
following Dedicated Service-related processes: (a) Initiation of 
service; (b) service Upgrades; and (c) service Disconnections. For 
instance, identify where your company records recurring and non-
recurring charges associated with the processes listed above. If 
recorded in a Tariff, provide the specific Tariff section(s). If these 
policies are recorded in documents other than Tariffs, list those 
documents and state whether they are publicly available. If they are 
publicly available, explain how to find them. For documents that are 
not publicly available, state whether they are conveyed to customers 
orally or in writing.
    3. Explain the procedures your company follows when a customer 
continues to purchase End-user Channel Terminations from your company 
but requests to change Transport Providers from your company to another 
Provider. In addition, answer the following questions regarding your 
process:
    a. Where are your procedures that govern these changes recorded? 
Provide the relevant Tariff number and section(s), if applicable, or 
identify which documents other than Tariffs contain these procedures. 
For documents that are not publicly available, state whether they are 
conveyed to customers orally or in writing.
    b. In 2012, what was the average length of time that it took your 
company to complete the process of connecting End User Channel 
Terminations to a new Transport Provider?
    c. Can purchasers negotiate timelines on a case-by-case basis?
    d. Do any of your company's policies, whether contained in Tariffs 
or other documents, limit the maximum number of circuits that can be 
connected to a new Transport Provider per day, per week, or per month? 
If yes, what is that number and what is the business rationale for this 
requirement?
    e. How does connecting to a new Transport Provider impact the rate 
a customer pays for the End User Channel Terminations the customer 
continues to purchase from your company?
    f. While the change in Transport Providers is pending completion 
and before there is a Disconnection in the Transport Service provided 
by your company, are there instances where the customer must pay a 
higher rate for the Transport Service provided by your company? If so, 
then detail those circumstances and what rates would apply before and 
after the request is made. For example, if the customer's contract 
expires or is terminated while a request to connect to a new Transport 
Provider is pending, would the customer pay a One Month Term Only Rate 
until there is a Disconnection in the Transport Service provided by 
your company?
    E. Purchasers that are mobile wireless service providers must 
respond to the following questions:
    1. How many cell sites do you have on your network?
    2. Provide the information requested below for each cell site on 
your network as of December 31, 2010 and as of December 31, 2012.
    a. A unique ID for the cell site;
    b. The actual situs address of the cell site (i.e., land where the 
cell site is located) if the cell site is located in or on a building;

[[Page 2596]]

    c. The geocode for the cell site (i.e., latitude and longitude);
    d. The CLLI code of the incumbent LEC wire center that serves the 
cell site, where applicable;
    e. Whether the cell site is in or on a building, is a free-standing 
cell site, or is on some other type of man-made structure, e.g., a 
water tower, billboard, etc.;
    f. If the cell site is served by a CBDS, indicate the equivalent 
number of DS1s used;
    g. If the cell site is served by a PBDS, indicate the bandwidth of 
the circuit in Mbps;
    h. If the cell site is served by a wireless Connection, indicate 
the bandwidth of the circuit in Mbps;
    i. The name of the Provider(s) that supplies your Connection to the 
cell site; and
    j. If you self-provide a Connection to the cell site, the 
provisioned bandwidth of that self-provided Connection.
    F. All Purchasers must respond to the following questions:
Expenditures Information
    1. What is the principal nature of your business, e.g., are you a 
CLEC, cable system operator, fixed wireless service provider, wireless 
Internet service provider, terrestrial or satellite mobile wireless 
service provider, interconnected VoIP service provider, etc.?
    2. What were your expenditures, i.e., dollar volume of purchases, 
on Dedicated Services for 2010 and 2012? For each year, report 
expenditures in total, separately for CBDS and PBDS purchases, and 
separately for purchases from ILECs and Competitive Providers.
    3. Provide your company's expenditures, i.e., dollar volume of 
purchases, for DS1s, DS3s, and/or PBDS purchased from ILECs pursuant to 
a Tariff in 2010 and in 2012. For each of the following categories, 
report expenditures for each year in total and separately for DS1s, 
DS3s and PBDS:
    a. All DS1s, DS3s, and PBDS;
    b. DS1s, DS3s, and PBDS purchased at One Month Term Only Rates;
    c. DS1s, DS3s, and PBDS purchased under Tariff Plans;
    d. DS1s, DS3s, and PBDS purchased under Contract-Based Tariffs;
    e. DS1s, DS3s, and PBDS purchased under Tariff Plans that contained 
a Term Commitment but not a Volume Commitment;
    f. DS1s, DS3s, and PBDS purchased under Tariff Plans that contained 
a Prior Purchase-Based Commitment;
    i. Of the total (and for the separate DS1, DS3, and PBDS totals 
where applicable), indicate the average discount from the One Month 
Term Only Rate incorporated in the expenditures.
    For purposes of calculating the percentages described above, an 
example would be a Tariff Plan that requires a purchase of 20 DS1s and 
10 DS3 and generates expenditures of $2,000 for calendar-year 2012. If 
those same circuits were purchased at One Month Term Only Rates of $100 
per DS1 and $200 per DS3, then total expenditures would instead be 
$4,000. Since the Tariff Plan under this scenario generated 50% of the 
expenditures that would be generated from One Month Term Only Rates, 
the discount would be 50%.
    g. DS1s, DS3s, and PBDS purchased under Contract-Based Tariffs that 
contained a Term Commitment but not a Volume Commitment; and
    h. DS1s, DS3s, and PBDS purchased under Contract-Based Tariffs that 
contained a Prior Purchased-Based Commitment;
    i. Of the total (and for the separate DS1 and DS3 totals if 
available), indicate the average discount from the One Month Term Only 
Rate incorporated in the expenditures.
    An example of how to calculate this percentage can be found at 
question II.F.3.f.i.
    4. What were your expenditures, i.e., dollar volume of purchases, 
on DS1s, DS3, and/or PBDS purchased from Competitive Providers pursuant 
to a Tariff in 2010 and in 2012? Report expenditures in total and 
separately for DS1s, DS3s and PBDS, as applicable, for the following 
categories for each year:
    a. All DS1s, DS3s, and PBDS;
    b. DS1s, DS3s, and PBDS purchased at One Month Term Only Rates;
    c. DS1s, DS3s, and PBDS purchased under Tariffs that contained a 
Term Commitment but not a Volume Commitment;
    d. DS1s, DS3s, and PBDS purchased under Tariffs that contained a 
Prior Purchase-Based Commitment;
    i. Of the total (and for the separate DS1, DS3, and PBDS totals 
where applicable), indicate the average discount from the One Month 
Term Only Rate incorporated in the expenditures.
    An example of how to calculate this percentage can be found at 
questionII.F.3.f.i.
    5. What were your expenditures, i.e., dollar volume of purchases, 
on DS1s, DS3s, and/or PBDS purchased from ILECs and Competitive 
Providers pursuant to an agreement (not a Tariff) in 2010 and in 2012? 
Report expenditures in total, separately for purchases from ILECs 
andCompetitive Providers, and separately for DS1s, DS3s and PBDS, as 
applicable, for the followingcategories for each year:
    a. All DS1s, DS3s, and PBDS;
    b. DS1s, DS3s, and PBDS purchased at a non-discounted rate;
    c. DS1s, DS3s, and PBDS purchased under a non-tariffed agreement 
that contained a Term Commitment but not a Volume Commitment;
    d. DS1s, DS3s, and PBDS purchased under a non-tariffed agreement 
that contained a Prior Purchase-Based Commitment;
    i. Of the total (and for the separate DS1, DS3, and PBDS totals 
where applicable), indicate the average discount from the non-
discounted rate incorporated in the expenditures.
    An example of how to calculate this percentage can be found at 
question II.F.3.f.i.
    6. What were your expenditures, i.e., dollar volume of purchases, 
on PBDS purchased under a Tariff in 2010 and in 2012?
    a. Separately for purchases from ILECs and Competitive Providers 
for the following service bandwidth categories:
    i. less than or equal to 1.5 Mbps;
    ii. greater than 1.5, but less than or equal to 50 Mbps;
    iii. greater than 50, but less than or equal to 100 Mbps;
    iv. greater than 100, but less than or equal to 1 Gbps; or
    v. greater than 1 Gbps.
    7. What were your expenditures, i.e., dollar volume of purchases, 
on non-tariffed PBDS in 2010 and in 2012?
    a. Separately for purchases from ILECs and Competitive Providers 
for the following service bandwidth categories:
    i. less than or equal to 1.5 Mbps;
    ii. greater than 1.5, but less than or equal to 50 Mbps;
    iii. greater than 50, but less than or equal to 100 Mbps;
    iv. greater than 100, but less than or equal to 1 Gbps; or
    v. greater than 1 Gbps.
Terms and Conditions Information
    8. Explain whether the terms and conditions of any contract to 
which you are a party for the purchase of Dedicated Services or the 
policies of any of your Providers constrain your ability to:
    a. Decrease your purchases from your current Provider(s);
    b. Purchase services from another Provider currently operating in 
the geographic areas in which you purchase services;
    c. Purchase non-tariffed services, such as Ethernet services, from 
your current

[[Page 2597]]

Provider of tariffed DS1, DS3, and/or PBDS services or from other 
Providers operating in the geographic areas in which you purchase 
tariffed services;
    d. Contract with companies that are considering entering the 
geographic areas in which you purchase tariffed services;
    e. Move circuits, for example, moving your DS1 and/or DS3 End-User 
Channel Terminations to connect to another Transport Provider; or
    f. Obtain Dedicated Services.
    Relevant terms and conditions, among others, may include: (a) Early 
termination penalties; (b) shortfall provisions; (c) overlapping/
supplemental discounts plans with different termination dates; (d) 
requirements to include all services, including new facilities, under a 
Tariff Plan or Contract-Based Tariff; or (e) requiring purchases in 
multiple geographic areas to obtain maximum discounts.
    In your answer, highlight contracts with particularly onerous 
constraints by comparison with more typical contract provisions. Also, 
at a minimum, list: (a) The Provider and indicate whether the Provider 
is an ILEC or a Competitive Provider; (b) a description of the term or 
condition; (c) the geographic area in which the tariffed services are 
provided; (d) the name of the vendor providing the tariffed service; 
and (e) the specific Tariff number(s) and section(s), or if the policy 
at issue is recorded in documents other than Tariffs, list those 
documents and how you obtained them.
    If you allege that a term, condition, or Provider's policy 
negatively affects your ability to obtain Dedicated Services, state 
whether you have brought a complaint to the Commission, a state 
commission or court about this issue and the outcome. If you have not 
brought a complaint, explain why not.
    9. Explain your experience with changing Transport Providers 
between January 1, 2010 and December 31, 2012, describing whether and 
how it has impacted your ability to purchase Dedicated Services. Where 
appropriate, identify the Provider(s) in your responses below.
    a. How many times did you change Transport Providers while keeping 
your End User Channel Terminations with an ILEC or Competitive 
Provider? An estimate of the number of circuits moved to a new 
Transport Provider, or the number of such changes requested for each 
year, is sufficient.
    b. What was the length of time, on average, it took for the ILEC or 
Competitive Provider to complete the process of connecting your last-
mile End-user Channel Terminations to another Transport Provider? An 
estimate is sufficient.
    c. Were you given the opportunity to negotiate time lines on a 
case-by-case basis?
    d. How did connecting to a new Transport Provider impact the rate 
you paid for the End User Channel Terminations you continued to 
purchase from the ILEC or Competitive Provider?
    e. Did connecting to a new Transport Provider typically impact the 
rate you continued to pay for Transport Service from the incumbent 
Provider while the change in Transport Providers remained pending? If 
so, what was the average percentage change in rates? Did you ever pay a 
One Month Term Only Rate during that time?
    10. Describe any circumstances since January 1, 2010, in which you 
have purchased circuits pursuant to a Tariff, solely for the purpose of 
meeting a Volume Commitment required for a discount or Non-Rate Benefit 
from your Provider (i.e., you did not utilize the circuits). In your 
description, provide at least one example, which at a minimum, lists:
    a. The geographic area (e.g., MSA or Non-MSA) in which you 
purchased the unnecessary circuits;
    b. The name of the Provider providing the circuits at issue;
    c. A description of the Volume Commitment;
    d. The Tariff and section number(s), if applicable, of the specific 
terms and conditions described;
    e. A comparison of the dollar amount of the unnecessary circuit(s) 
purchased versus the dollar amount of penalties your company would have 
had to pay had it not purchased and/or maintained the circuit(s), and a 
description of how that comparison was calculated.
    11. For each year for the past five years, state the number of 
times and in what geographic area(s) you have switched from one 
Provider of Dedicated Services to another.
    12. Explain the circumstances since January 1, 2010 under which you 
have paid One Month Term Only Rates for DS1, DS3, and/or PBDS services 
and the impact, if any, it had on your business and your customers. In 
your response, indicate any general rules you follow, if any, 
concerning the maximum number of circuits and maximum amount of time 
you will pay at One Month Term Only Rates, and your business rationale 
for any such rules.
    13. Separately list all available Tariffs under which your company 
purchases DS1s, DS3s, and/or PBDS and provide the information requested 
below for each plan.
    a. This plan is a:
    [ballot] Tariff Plan
    [ballot] Contract-Based Tariff (select one)
    b. Plan name:
    c. Provider name:
    d. Tariff and Section Number(s):
    e. Tariff type:
    [ballot] Interstate
    [ballot] Intrastate
    f. This plan contains:
    [ballot] Term Commitment(s)
    [ballot] Volume Commitment(s)
    [ballot] Non-Rate Benefit option(s) (select all that apply)
    g. If the plan contains Non-Rate Benefits, identify the Non-Rate 
Benefits that were relevant to your decision to purchase services under 
this plan.
    h. This plan can be applied to the purchase of:
    [ballot] DS1 services
    [ballot] DS3 services
    [ballot] PBDS
    [ballot] Other (select all that apply)
    i. In what geographic areas do you purchase DS1s, DS3s, and/or PBDS 
under this plan, e.g., nationwide, a particular region of the country, 
certain states, certain MSAs, a particular study area?
    j. To receive a discount or Non-Rate Benefit under this plan, does 
your company make a Prior Purchase-Based Commitment?
    [ballot] Yes
    [ballot] No
    k. If this is an ILEC plan, do DS1 or DS3 purchases your company 
makes outside the study area(s) of the ILEC (e.g., purchases from an 
Affiliated Company of the ILEC that is providing out-of-region service 
as a CLEC) count towards meeting any Volume Commitment to receive a 
discount or Non-Rate Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment, not an ILEC plan)
    i. If you answered yes, in what geographic areas outside the study 
area(s) of the ILEC, do you purchase these DS1s and/or DS3s?
    ii. Of the geographic areas identified, in which of those areas 
would your company have purchased from a different Provider, if at all, 
had it not been for the discounts or Non-Rate Benefits received under 
this plan? In your response, indicate whether the Provider that you 
would have purchased from has Connections serving that geographic area.
    l. If this is an ILEC plan, do DS1 and/or DS3 purchases your 
company makes from the ILEC in price cap areas where the Commission has 
not granted the ILEC pricing flexibility count towards meeting any 
Volume Commitment to

[[Page 2598]]

receive a discount or Non-Rate Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment, not an ILEC plan)
    i. If you answered yes, then identify the price cap areas where you 
purchase DS1s and/or DS3s that count towards meeting any Volume 
Commitment to receive a discount or Non-Rate Benefit under this plan?
    m. If this is an ILEC plan, do DS1 and/or DS3 purchases your 
company makes from the ILEC in areas where the Commission has granted 
either Phase I or Phase II Pricing Flexibility count towards meeting 
any Volume Commitment to receive a discount or Non-Rate Benefit under 
this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment, not an ILEC plan)
    i. If you answered yes, in what geographic areas subject to pricing 
flexibility do you purchase DS1s and/or DS3s that count towards meeting 
any Volume Commitment to receive a discount or Non-Rate Benefit under 
this plan?
    ii. Of the geographic areas identified, in which of those areas 
would your company have purchased from a different Provider, if at all, 
had it not been for the requirements of the Tariff Plan? In your 
response, indicate whether the Provider that you would have purchased 
from has Connections serving that geographic area.
    n. If this is an ILEC plan, do non-tariffed PBDS purchases you make 
from this ILEC count towards meeting any Volume Commitment to receive a 
discount or Non-Rate Benefit under this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment, not an ILEC plan)
    i. If you answered yes, in what geographic areas do you purchase 
non-tariffed PBDS that counts towards meeting any Volume Commitment to 
receive a discount or Non-Rate Benefit under this plan.
    ii. Of the geographic areas identified, in which of those areas 
would your company have purchased PBDS from a different Provider, if at 
all, had it not been for the requirements of the plan? In your 
response, indicate whether the Provider that you would have purchased 
from has Connections serving that geographic area.
    o. If this is an ILEC plan, do purchases you make for services 
other than DS1s, DS3s, and PBDS from this ILEC count towards meeting 
any Volume Commitment to receive a discount or Non-Rate Benefit under 
this plan?
    [ballot] Yes
    [ballot] No
    [ballot] N/A (no Volume Commitment, not an ILEC plan)
    i. If you answered yes, identify the other services purchased and 
the geographic areas where you purchase these services that count 
towards meeting any Volume Commitment to receive a discount or Non-Rate 
Benefit under this plan.
    ii. Of the geographic areas identified, in which of those areas 
would your company have purchased those other services from a different 
Provider, had it not been for the requirements of the plan? In your 
response, indicate whether the Provider that you would have purchased 
from has Connections serving that geographic area.
    p. Is the discount or Non-Rate Benefit available under this plan 
conditioned on the customer limiting its purchase of UNEs, e.g., the 
customer must keep its purchase of UNEs below a certain percentage of 
the customer's total spend? If yes, then provide additional details 
about the condition.
    14. Do you have any non-tariffed agreement with an ILEC that, 
directly or indirectly, provides a discount or a Non-Rate Benefit on 
the purchase of tariffed DS1, DS3, and/or PBDS services, restricts your 
ability to obtain UNEs, or negatively affects your ability to purchase 
Dedicated Services?
    [ballot] Yes
    [ballot] No
    a. If so, identify each agreement below, including the parties to 
the agreement, the effective date, and a summary of the relevant 
provisions.
    G. Non-Providers and Non-Purchasers instructed to respond to this 
data collection must respond to the following:
    1. If you must respond to this data collection because you filed 
the FCC Form 477 in 2012 to report the provision of ``broadband 
connections to end user locations'' but are not (a) a Provider or a 
Purchaser as defined in this data collection or (b) an entity that 
provides Best Efforts Business Broadband Internet Access Services, then 
indicate as such below and complete the certification accompanying this 
data collection.
    [ballot] I am not a Provider.
    [ballot] I am not a Purchaser.
    [ballot] I do not provide Best Efforts Business Broadband Internet 
Access Services.
    (select all that apply)
Certification
    I have examined the response and certify that, to the best of my 
knowledge, all statements of fact, data, and information contained 
therein are true and correct.

Signature:-------------------------------------------------------------

Printed Name:----------------------------------------------------------

Title:-----------------------------------------------------------------

Date:------------------------------------------------------------------

    * Respondents are reminded that failure to comply with these data 
reporting requirements may subject them to monetary forfeitures of up 
to $150,000 for each violation or each day of a continuing violation, 
up to a maximum of $1,500,000 for any single act or failure to act that 
is a continuing violation. False statements or misrepresentations to 
the Commission may be punishable by fine or imprisonment under Title 18 
of the U.S. Code.

VI. Ordering Clauses

    136. Accordingly, it is ordered that pursuant to sections 1, 4(i), 
4(j), 5, 201-205, 211, 215, 218, 219, 303(r), 332, 403, and 503 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 
155, 201, 202, 203, 204, 205, 211, 215, 218, 219, 303(r), 332, 403, 
503, and section 706 of the Telecommunications Act of 1996, 47 U.S.C. 
1302, the Report and Order, with all attachments, is adopted March 12, 
2013, except for those rules and requirements involving Paperwork 
Reduction Act burdens, which shall become effective upon announcement 
in the Federal Register of OMB approval and an effective date of the 
rule(s), and except as specified in paragraph 137.
    137. It is further ordered that we delegate authority to the 
Wireline Competition Bureau to implement a data collection in 
accordance with the terms of this Report and Order, and that this 
delegation of authority is effective upon adoption, see 47 U.S.C. 
155(c).
    138. It is further ordered that the data collection shall become 
effective upon announcement in the Federal Register of Office of 
Management and Budget approval and an effective date of the 
requirements.
    139. It is further ordered that the Commission SHALL SEND a copy of 
this Report and Order to Congress and the Government Accountability 
Office pursuant to the Congressional Review Act, see 5 U.S.C. 
801(a)(1)(A).
    140. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Report and Order, including the Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration.


[[Page 2599]]


Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 2013-00278 Filed 1-10-13; 8:45 am]
BILLING CODE 6712-01-P`