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[Federal Register Volume 65, Number 186 (Monday, September 25, 2000)]
[Rules and Regulations]
[Pages 57557-57561]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-24541]

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 15

[ET Docket 99-231; FCC 00-312]

Spread Spectrum Devices

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document amends the Commission's rules for frequency 
hopping spread spectrum devices in the 2.4 GHz band (2400-2483.5 MHz). 
The rules were amended to allow frequency hopping spread spectrum 
transmitters operating in the band to use a minimum of 15 hopping 
channels, spanning a total of 75 MHz. The new rules will allow for 
hopping channels up to 5 MHz wide. The wider bandwidths will permit 
these systems to provide higher data speeds, thereby enabling the 
development of new and improved consumer products such as wireless 
computer local area networks and wireless cable modems.

DATES: Effective September 25, 2000.

FOR FURTHER INFORMATION CONTACT: Neal L. McNeil, Office of Engineering 
and Technology, (202) 418-2408, TTY (202) 418-2989, e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's First 
Report and Order, ET Docket 99-231, FCC 00-312 adopted August 24, 2000 
and released August 31, 2000. The full text of this document is 
available for inspection and copying during regular business hours in 
the FCC Reference Center, (Room CY-A257) 445 12th Street SW., 
Washington, DC. The complete text of this document also may be 
purchased from the Commission's duplication contractor, International 
Transcription Service, Inc., (202) 857-3800, 1231 20th Street, NW, 
Washington, DC 20036.

Summary of Report and Order

    1. The First Report and Order (``R&O'') amends the Commission's 
rules for frequency hopping spread spectrum devices in the 2.4 GHz band 
(2400-2483.5 MHz). The rules were amended to allow frequency hopping 
spread spectrum transmitters operating in the band to use a minimum of 
15 hopping channels, spanning a total of 75 MHz. The new rules will 
allow for hopping channels up to 5 MHz wide. The wider bandwidths will 
permit these systems to provide higher data speeds, thereby enabling 
the development of new and improved consumer products such as wireless 
computer local area networks and wireless cable modems.
    2. The Commission initiated a Notice of Proposed Rule Making 
(``Notice''), 64 FR 38877, July 20, 1999, in this proceeding in 
response to a letter filed by the Home RF Working Group (``Home RF'') 
requesting that part 15 spread spectrum systems operating in the 2.4 
GHz band be permitted to use bandwidths of up to 5 MHz. The Notice 
proposed rule changes consistent with the request of the Home RF 
Working Group. Specifically, the Notice proposed to allow systems to 
operate with bandwidths of up to 3 MHz or 5 MHz in the 2.4 GHz band. 
Under the proposal, the systems would utilize 75 hopping channels. 
Output power would be reduced in proportion to the increase in 
bandwidth over 1 MHz. For example, systems with 3 MHz bandwidths would 
operate with output power of no more than 320 mW and channel occupancy 
time no greater than 0.05 second per hop. Each of the 75 channels would 
be used at least once during a 3.75 second period. Like existing 1 MHz 
systems, the average time of occupancy on any channel would not be 
greater than 0.4 second within a 30 second period. Under the proposal, 
systems using 5 MHz bandwidths would operate with output power of no 
more than 200 mW and channel occupancy time of no greater than 0.02 
second per hop. Each of the 75 hopping channels would be used at least 
once during a 1.5 second period. Again, the average occupancy time on 
any channel would remain 0.4 second or less per 30 second period.
    3. Opponents of the proposed rules expressed a number of concerns. 
For example, the Wireless Ethernet Compatibility Alliance (``WECA'') 
filed comments October 14, 1999, asserting that devices operating under 
the proposed new rules will not be able to achieve the claimed higher 
data rates because they will be more prone to multipath and 
interference problems. The opponents therefore assert the Home RF 
proposal will have little or no public benefit. The opponents are 
concerned that, under the Notice, wide band frequency hopping systems 
could use overlapping hopping channels. Intersil and Lucent submitted 
technical analyses and test data claiming to show that interference 
from partially overlapping channels is more detrimental to frequency 
hopping systems than the first-adjacent or co-channel interference. 
According to Intersil, wide band frequency hopping systems employing 
overlapping channels will experience a greater level of mutual 
interference than existing systems that use 1 MHz bandwidths. To 
compensate, they assert that the systems would likely resort to 
multiple retransmissions, with the net effect that wide bandwidth 
systems will transmit continuously and totally occupy the 2400-2483 MHz 
band to the exclusion of other devices. Silicon Wave supports 
Intersil's findings. Several parties state that the Home RF proposal 
will cause interference to devices under development by Bluetooth, a 
cross-industry group formed to establish industry-wide specifications 
for unlicensed wireless voice and data communications devices operating 
in the 2.4 GHz band
    4. WECA and other opponents of the Home RF proposal offer several 
proposals as a compromise to reduce the potential for interference to 
other part 15 devices. They maintain that the output power should be 
reduced much further than the proposed 200 milliwatts. Several members 
of WECA offer a compromise that would limit the bandwidth of wide band 
frequency hopping spread spectrum systems to 4 MHz, establish a minimum 
of 20 hopping channels, and restrict the output power to 65 milliwatts. 
WECA asserts that this proposal would be consistent with European 
standard ETS 300 328. The ETS 300 328 standard permits frequency 
hopping systems in the 2.4 GHz band to use at least 20 non-overlapping 
hopping channels, each with up to 4 MHz bandwidth, and up to 100 mW 
effective radiated power, or 61 mW transmitter output power based on an 
assumed antenna gain of 1.64. WECA notes that, in a previous proceeding 
where the Commission reduced the number of required hops for spread 
spectrum devices operating in the 915 MHz band, the output power was 
reduced in proportion to the square in the number of hopping 
frequencies. For a system using a 4 MHz bandwidth the number of hopping 
channels would be reduced by a factor of approximately 4 (from 75 to 20 
channels), and the output power would need to be reduced by a factor of 
16 (from 1 watt to 60 mW). WECA also suggests two additional 
requirements. First, WECA proposes to require interference rejection 
tests for receivers in frequency hopping systems having channel widths 
greater than 1 MHz. WECA states that the test is necessary to ensure 
that receiver performance is adequate to minimize the need to 
retransmit packets, which,

[[Page 57558]]

in turn, will minimize interference to other devices. Second, WECA 
suggests that the Commission place a maximum limit of 100 hops/sec for 
frequency hopping systems using bandwidths greater than 1 MHz.
    As justification, WECA argues that parties on both sides of the 
debate have acknowledged that increasing the hopping rate also 
increases interference. However, WECA concedes that in some cases 
faster hopping is necessary and desirable for 1 MHz systems. Therefore, 
WECA does not propose maximum hopping rate restrictions for systems 
using 1 MHz channels.
    5. In response to the opposition, supporters of the Notice offer 
suggestions for accommodating wider bandwidths without overlapping 
channels. In an ex parte filing received March 23, 2000, Proxim Inc. 
proposes to allow manufacturers to use 3 MHz or 5 MHz wide, non-
overlapping hopping channels. The total number of channels used would 
span at least 75 MHz. Output power for systems using 3 MHz and 5 MHz 
wide channels would remain 320 mW and 200 mW, respectively, as 
originally proposed in the Notice. Under the Proxim proposal, the 
average time of occupancy on any hopping channel would be limited to 
0.4 seconds within a 30 second period or a period of 30 seconds divided 
by the 20 dB channel bandwidth, whichever is less.
    6. We find that the record supports rule changes that will permit 
wider bandwidths for frequency hopping spread spectrum systems. We 
reject the argument that such rule changes will have little or no 
benefit. We note that numerous parties filed comments indicating that 
the proposed rule changes would permit the introduction of a wide array 
of new and improved devices. We have no reason to doubt these claims. 
We anticipate that any technical constraints to higher data speeds 
using wider bandwidths can be overcome by appropriate equipment design. 
We also agree that rule changes to permit wide band frequency hopping 
systems will encourage competition with direct sequence technology, to 
the benefit of consumers.
    7. We believe it is appropriate to adopt rules that represent a 
reasonable engineering compromise between the risks of increased 
interference and the desire to accommodate new technologies. We are 
concerned about the comments submitted by the opponents regarding the 
interference potential of overlapping frequency hopping channels. 
Intersil's technical analysis presents compelling arguments why 
overlapping channels should not be allowed. Supporters of the Notice 
submitted modified proposals which would eliminate the use of 
overlapping channels. In light of this concession, we will amend our 
rules to allow frequency hopping systems in the 2.4 GHz band to operate 
with at least 15 channels. The channels must be separated by at least 
their 20 dB bandwidths and may never overlap. The total span of 
channels shall be at least 75 MHz. We will also require that systems 
have a greater output power reduction than that proposed in the Notice. 
In order to reduce any potential impact on existing unlicensed devices, 
we will limit transmitter output power to 125 mW for any frequency 
hopping system that operates with fewer than 75 hopping channels. This 
power level is consistent with that used by many frequency hopping 
systems today and is only 3 dB more than opponents of the Home RF 
proposal. We are concerned that any further power reduction will 
constrain the useful operating range to such an extent that the devices 
will not be useful. The provision for 15 non-overlapping channels will 
accommodate up to 5 MHz bandwidths, which will allow faster data speeds 
and enable backward compatibility with existing devices.
    8. In the Notice, we proposed minimum hopping rates of 20 hops/s 
(0.05 s/hop channel dwell time) and 50 hops/s (0.02 s/hop channel dwell 
time) for systems using 3 MHz and 5 MHz channels, respectively. 
However, in order to remain consistent with former regulations, we will 
leave the minimum hopping rate unchanged at 2.5 hops/s. Furthermore, we 
will not specify a maximum hopping rate for wide band frequency hopping 
systems, as WECA suggested. We realize that choosing the hopping rate 
for a system involves trade-offs. For example, the Committee for 
Unlicensed Broadband Enablement (``CUBE'') noted that faster hopping 
may be beneficial in some instances because the result is less time 
spent, on an instantaneous basis, on a channel that may be experiencing 
interference. On the other hand, faster hopping may also decrease 
system efficiency due to the greater amount of non-transmitting 
transition phases. The Commission has previously given manufacturers 
latitude in choosing the hopping rate which best suits their particular 
application. We are confident that manufacturers will continue to use 
good engineering practices in order to achieve their desired results 
without increasing the risk of harmful interference.
    9. We will not specify receiver standards, as proposed in WECA's 
April 10, 2000 letter. We find that Sec. 15.247(a)(1), which requires 
receiver input bandwidth to match hopping channel bandwidth, provides 
ample assurance that receivers are indeed functioning as part of a 
spread spectrum system. That is the intent of the rule section. 
Additionally, we agree with the Proxim letter dated April 14, 2000, 
stating that this issue is not appropriate for resolution in this First 
R&O since it was neither proposed by the Commission nor discussed by 
other parties.
    10. The Notice in this proceeding, also proposed to modify the 
method for measuring processing gain for certain direct sequence spread 
spectrum systems. Because of the large volume of comments the 
Commission has received in this proceeding, we have decided to address 
the topics individually. Accordingly, we are postponing adoption of 
final rules for measuring processing gain. We will address the issue in 
a future Report and Order. The action we take here is not dependent on 
resolution of the processing gain issue.

Final Regulatory Flexibility Analysis

    11. As required by the Regulatory Flexibility Act (``RFA''),\1\ an 
Initial Regulatory Flexibility Analysis (``IRFA'') was incorporated in 
the Notice of Proposed Rule Making (``NPRM'') in this docket, ET Docket 
99-231.\2\ The Commission sought written public comment on the 
proposals in the NPRM, including comment on the IRFA. As described more 
fully below, we find that the rules we adopt in the First Report and 
Order will not have a significant economic impact on a substantial 
number of small entities.\3\ We have nonetheless provided this Final 
Regulatory Flexibility Analysis (``FRFA'') to provide a fuller record 
in this proceeding. This IRFA conforms to the RFA.\4\
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    \1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et seq., has 
been amended by the Contract With America Advancement Act of 1996, 
Public Law 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the 
CWAAA is the Small Business Regulatory Enforcement Fairness Act of 
1996 (SBREFA).
    \2\ See ET Docket 99-231, FCC 99-149, 64 FR 38877, July 20, 
1999.
    \3\ Thus, we could certify that an analysis is not required. See 
5 U.S.C. 605(b).
    \4\ See 5 U.S.C. 604.
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A. Need for and Objective of the Rules

    12. The rules adopted in this First Report and Order are intended 
to facilitate the development of spread spectrum technology, 
particularly for high data-rate wireless applications. The rules will 
permit frequency hopping spread spectrum systems in the 2.4 GHz band 
(2400-2483.5 MHz) to operate with wider hopping channels. This action 
is taken in response to a request

[[Page 57559]]

filed by the Home RF Working Group (``Home RF''). The Home RF request 
stated that the increased bandwidth is needed to meet business and 
consumer demand for high-speed data applications.
    13. In the NPRM in this proceeding, the Commission also proposed to 
modify the method for measuring processing gain for certain direct 
sequence spread spectrum systems. Because of the large volume of 
comments the Commission has received in this proceeding, we have 
decided to address this second issue separately. Accordingly, we are 
postponing adoption of final rules for measuring processing gain, and 
will address the issue in a future Report and Order. The action we take 
here is not dependent on resolution of the processing gain issue.

B. Summary of Significant Issues Raised by Comments in Response to the 
IRFA

    14. We received six comments in response to the IRFA in this 
proceeding. Three were submitted by the Office of Advocacy of the U.S. 
Small Business Administration (SBA), one by Proxim, Inc. (Proxim), 
which is a small business, and one comment apiece by the U.S. Senate 
and House Small Business Committees.
    15. In its comment dated October 4, 1999, SBA stated that the IRFA 
did not comply with the RFA. Specifically, SBA stated that the IRFA did 
not fully consider the impact that the Commission's proposal would have 
on small entities. Furthermore, SBA stated that the IRFA failed to 
estimate the number of small businesses affected, describe the 
objectives of the proposed rules, propose alternatives, and properly 
state the paperwork burden the rules would place on equipment 
manufacturers. Accordingly, SBA stated that the Commission should not 
adopt final rules in this proceeding until the Commission conducted a 
fuller, superseding IRFA.
    16. Subsequently, in the first of the remaining five, ex parte 
comments filed in response to the IRFA, Proxim filed a comment dated 
January 11, 2000. Proxim stated that approximately 80 small businesses 
filed comments in this proceeding, constituting over 66 percent of the 
almost 120 comments filed in total. Proxim noted that small business 
participated during both the comment and reply comment periods, and 
filed comments on both sides of the proposals. Last, Proxim argued that 
the proposal to permit frequency hopping spread spectrum systems would 
benefit small business by permitting ``a low cost means for home-based 
business to create a low-cost network capable of supporting high-
capacity communications''--a network capability that, currently, 
``likely is beyond the financial and/or technical reach of many small 
businesses and most very small home-based businesses.''
    17. SBA's second comment was dated February 29, 2000. SBA clarified 
its position in light of Proxim's filing, stating that even if the 
significant economic effect of a proposal will be beneficial for small 
business, the proposal must be described and analyzed in an adequate 
IRFA. SBA stated that it did not wish to delay the issuance of final 
rules, and that, in light of the information provided by Proxim, the 
Commission should rectify its IRFA by conducting an adequate FRFA in 
conjunction with the adoption of final rules.
    18. The Senate Committee on Small Business, in its comment dated 
August 8, 2000, stated that the IRFA did not sufficiently describe why 
the proposed action was being taken, did not discuss the reporting or 
recordkeeping requirements or skills necessary to satisfy the 
requirements of the rules, and did not offer alternatives to the 
proposed rules that would minimize the impact on small business. The 
Committee asked that the Commission revise the IRFA. The House 
Committee on Small Business, in its comment dated August 15, 2000, 
concurred with the Senate Committee's position.
    19. SBA, in its third comment, dated August 18, 2000, stated that, 
in filing its second comment, SBA ``did not intend to withdraw its 
critical comments or relieve the FCC of its duty under RFA.''
    20. In response to these comments, we have conducted this present, 
full FRFA. We also take this opportunity to discuss the previous 
analysis or IRFA, which, although not exhaustive, was sufficient to 
generate comments from the small business community. We believe that 
the record indicates that the IRFA met the objectives of the RFA. 
Delaying issuance of final rules at this time would not, therefore, 
advance those objectives.
    21. First, concerning whether the IRFA sufficiently described why 
the proposed action was being taken, we note that the reason for action 
is clearly stated in the first paragraph of the Notice. The paragraph 
reads in part, ``We take this action to facilitate the continued 
development and deployment of spread spectrum technology, particularly 
for high data rate wireless applications.'' Therefore, interested 
parties who read the document were notified in the beginning of the 
item why the action was being taken. While the IRFA did not 
specifically mention the purpose of the proposed action, we believe 
that the Notice adequately informed interested parties of the reason 
for the proposed action, as required by the Regulatory Flexibility Act.
    22. Concerning whether the IRFA adequately discussed the reporting 
or recordkeeping requirements or skills necessary to satisfy the rule 
requirements, we note that the IRFA stated that the proposed rule 
changes would not alter any current reporting or recordkeeping 
requirements. We emphasize that part 15 transmitters must be authorized 
under the Commission's certification procedure prior to marketing. The 
certification procedure requires that the device in question be tested 
to ensure that it is in compliance with Commission regulations. An 
application for certification must contain a report describing the test 
procedure as well as the test results. The proposal in the NPRM would 
permit alternative modes of operation for frequency hopping systems. 
However, the new operating modes would not alter the reporting or 
recordkeeping requirements for manufacturers of these devices.
    23. The NPRM also proposed a modified test procedure for certain 
direct sequence spread spectrum systems. The Notice proposed that, 
``manufacturers of direct sequence spread spectrum systems that use a 
spreading rate less than 10 chips per symbol to submit the results of 
the jamming margin test as well as a calculation of processing gain to 
verify compliance.'' This statement may have created the impression 
that the Commission was intending to impose new reporting requirements. 
However, as stated above, the certification procedure already requires 
the submission of test results and a report showing compliance with the 
rules. Our proposal only sought to clarify the specific information to 
include in this report.
    24. Concerning whether the IRFA should have offered and discussed 
alternatives to the proposed rules that would have minimized the impact 
on small businesses, we believe that a positive benefit will result to 
small business as a result of this proceeding. Thus, we did not offer 
alternatives. Again, we should emphasize that the proposals would not 
require manufacturers to modify existing products. Instead, the rules 
would allow introduction of new devices into the marketplace. We expect 
that the rules will benefit small manufacturers by allowing them to 
distribute more diverse products. In turn, the more

[[Page 57560]]

diverse product selection will provide greater flexibility in designing 
wireless networks, thereby benefiting small businesses that use these 
types of devices.
    25. Concerning whether the IRFA provided sufficient information so 
that the public could react in an informed manner, we note that, 
pursuant to the Administrative Procedure Act, see 5 U.S.C. 553, the 
Commission must provide ample opportunity for the public to comment on 
proposed rules. In this proceeding, the Commission provided a 75-day 
filing window for initial comments, followed by a 122-day period for 
reply comments. In total, the public had over six months to provide 
comments. More than 200 comments and other submissions were filed in 
this proceeding. Many of the commenters, including small businesses and 
educational institutions, enthusiastically endorsed the proposed 
changes. With the exception of the Small Business Administration, which 
subsequently clarified its comments, and Congress, no commenters raised 
adverse concerns regarding the IRFA. The Commission relies upon the 
public record to develop its rules. The rules changes in this 
proceeding were initiated at the urging and support of the small 
business community.
    26. In addition, for existing manufacturers to take advantage of 
the revised rule and begin to supply frequency-hopping equipment, the 
manufacturer will need only to slightly modify frequency control 
components in their products. Such modification appears to us, given 
common understanding of the equipment, to be achievable with minimal 
effort and cost. In fact, as stated previously, many manufacturers, 
including small businesses, enthusiastically supported this rule 
change.
    27. Last, we note that, in light of comments in response to the 
NPRM, we have altered our equipment usage parameters to eliminate the 
interference potential that might have resulted under the proposed 
rule. The changes have included eliminating the use of overlapping 
channels and reducing the maximum permitted power output.

C. Description and Estimate of the Number of Small Entities to Which 
the Rules Will Apply

    28. 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.\5\ The RFA generally 
defines the term ``small entity'' as having the same meaning as the 
terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdictions.'' In addition, the term ``small business'' 
has the same meaning as the term ``small business concern'' under the 
Small Business Act, 15 U.S.C. 632, unless the Commission has developed 
one or more definitions that are appropriate to its activities.\6\ A 
``small business concern'' is one that: (1) Is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) meets 
any additional criteria established by the Small Business 
Administration (''SBA'').\7\
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    \5\ 5 U.S.C. 603(b)(3).
    \6\ See 5 U.S.C. 601(3).
    \7\ 15 U.S.C. 632.
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    29. The Commission has not developed a definition of small entities 
specifically directed toward manufacturers of unlicensed communications 
devices. Therefore, we will utilize the SBA definition applicable to 
manufacturers of Radio and Television Broadcasting and Communications 
Equipment. According to the SBA regulations, unlicensed transmitter 
manufacturers must have 750 or fewer employees in order to qualify as a 
small business concern.\8\ Census Bureau data indicates that there are 
858 U.S. companies that manufacture radio and television broadcasting 
and communications equipment, and that 778 of these firms have fewer 
than 750 employees and would be classified as small entities.\9\ This 
action will not have a negative impact on small entities that 
manufacture unlicensed spread spectrum devices.
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    \8\ See 13 CFR 121.201, (SIC) Code 3663.
    \9\ See U.S. Dept. of Commerce, 1992 Census of Transportation, 
Communications and Utilities (Issued May 1995), SIC category 3663.
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    30. According to SBA regulations, an electronic computer 
manufacturer must have 1,000 or fewer employees in order to qualify as 
a small entity.\10\ Census Bureau data indicates that there are 716 
firms that manufacture electronic computers. Of those, 659 have fewer 
than 500 employees and qualify as small entities.\11\ The remaining 57 
firms have 500 or more employees; however, we unable to determine how 
many of those have 1,000 or fewer employees and therefore also qualify 
as small entities under the SBA definition.
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    \10\ 13 CFR 121.201, SIC code 3571.
    \11\ U.S. Small Business Administration 1995 Economic CEnsus 
Industry and Enterprise Report, Table 3, SIC Code 3571. (Burau of 
the Census data adapted by the Office of Advocacy of the U.S. Small 
Business Administration).
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    31. According to SBA regulations, a computer terminal manufacturer 
must have 1,000 or fewer employees in order to qualify as a small 
entity.\12\ Census Bureau data indicates that there are 757 firms that 
manufacture computer terminals. Of those, 162 have fewer than 500 
employees and qualify as small entities.\13\ The remaining 11 firms 
have 500 or more employees; however, we unable to determine how many of 
those have 1,000 or fewer employees and therefore also qualify as small 
entities under the SBA definition.
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    \12\ 13 CFR 121.201, SIC code 3575.
    \13\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, SIC Code 3575. (Bureau of 
the Census data adapted by the Office of Advocacy of the U.S. Small 
Business Administration).
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    32. According to SBA regulations, a computer peripheral equipment 
manufacturer must have 1,000 or fewer employees in order to qualify as 
a small entity.\14\ Census Bureau data indicates that there are 757 
firms that manufacture computer terminal equipment. Of those, 701 have 
fewer than 500 employees and qualify as small entities.\15\ The 
remaining 56 firms have 500 or more employees; however, we unable to 
determine how many of those have 1,000 or fewer employees and therefore 
also qualify as small entities under the SBA definition.
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    \14\ 13 CFR 121.201, SIC code 3577.
    \15\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, SIC Code 3639. (Bureau of 
the Census data adapted by the Office of Advocacy of the U.S. Small 
Business Administration).
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    33. According to SBA regulations, a manufacturer of household 
appliances must have 500 or fewer employees in order to qualify as a 
small entity.\16\ Census bureau indicates that there are 55 firms that 
manufacture household equipment in the ``catch all'' category for such 
data. Of those, 42 have fewer than 500 employees and qualify as small 
entities.\17\ The remaining 13 firms have 500 or more employees, and 
therefore, unless one or more has exactly 500 employees do not qualify 
as small entities under the SBA definition.
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    \16\ 13 CFR 121.201, SIC code 3639 (Household Appliances, Not 
Elsewhere Classified).
    \17\ U.S. Small Business Administration 1995 Economic Census 
Industry and Enterprise Report, Table 3, SIC Code 3639. (Bureau of 
the Census data adapted by the Office of Advocacy of the U.S. Small 
Business Administration).
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D. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements

    34. Part 15 transmitters are already required to be authorized 
under the Commission's certification procedure as a prerequisite to 
marketing and importation. See 47 CFR 15.101, 15.201, 15.305, and 
15.405. The new regulations will add permissible methods of operation 
for frequency hopping spread

[[Page 57561]]

spectrum systems. No new reporting or recordkeeping requirements will 
be required for the manufacturers of frequency hopping spread spectrum 
devices.
    35. As previously noted, in the NPRM in this proceeding, the 
Commission also proposed a modified test procedure for certain direct 
sequence spread spectrum devices. Although this First Report and Order 
does not address this second issue, we emphasize that the proposed 
processing gain measurement procedure would not alter reporting or 
recordkeeping requirements. As stated above, the certification 
procedure already requires the submission of test results and a report 
showing compliance with Commission rules. The proposal would clarify 
the specific information to include in this report.

E. Steps Taken To Minimize Significant Economic Impact on Small 
Entities and Significant Alternatives Considered

    36. The rule changes adopted in this First Report and Order are 
intended to support the development of improved frequency hopping 
spread spectrum systems. These actions will benefit frequency hopping 
spread spectrum manufacturers, including small entities.
    37. In the NPRM, we proposed to allow frequency hopping systems in 
the 2400-2483.5 MHz band to operate with bandwidths of up to 5 MHz. The 
increase in bandwidth over 1 MHz would be accompanied by a 
proportionate decrease in output power. The minimum number of hopping 
channels would remain the same.
    38. Supporters of the NPRM argued that the rule changes were needed 
to accommodate high-speed data transmissions for home and business 
applications. The opponents argued that the proposed changes would 
cause unacceptable interference to other part 15 devices already 
operating in this spectrum. While they recognized that part 15 devices 
have no interference protection under the rules, opponents asserted 
that the Commission should act on public interest grounds to avoid 
increasing interference to existing consumer devices. They suggested 
several modifications to the proposal which, they claimed, would reduce 
the interference threat. Proponents of the NPRM also filed modified 
proposals in an effort to reach a compromise.
    39. In response to the comments filed by interested parties, 
including small businesses, the Commission modified the proposal 
contained in the NPRM by requiring frequency hopping systems to use at 
least 15 non-overlapping channels. We have also reduced the maximum 
transmitter output power from that which was proposed in the NPRM. The 
new rules will accomplish the objectives stated in the NPRM while 
creating less of an interference threat to other systems currently 
operating in the 2400--2483.5 MHz band. The changes we adopt in this 
First Report and Order will result in increased maximum data rates for 
frequency hopping spread spectrum devices operating in the 2.4 GHz 
band. The rules will benefit manufacturers of home electronic 
equipment, including small businesses, by enabling them to offer 
customers a greater variety of products that meet their customers' 
networking needs.
    40. As noted, we received numerous comments in this proceeding, and 
one alternative would have been to deny the request of Home RF and 
other proponents. That alternative, which we rejected, would not have 
resulted in the introduction of high-speed data applications that we 
believe will result as a consequence of the rules we are adopting.
    41. Report to Congress. The Commission will send a copy of the 
First Report and Order, including this FRFA, in a report to Congress 
pursuant to SBREFA.\18\ In addition, the Commission will send a copy of 
the First Report and Order, including the FRFA, to the Chief Counsel 
for Advocacy of the SBA.
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    \18\ See 5 U.S.C. 801(a)(1)(A).
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List of Subjects in 47 CFR Part 15

    Communications equipment.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.

Rule Changes

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR part 15 as follows:

PART 15--RADIO FREQUENCY DEVICES

    1. The authority citation for part 15 continues to read as follows:

    Authority: 47 U.S.C. 154, 302, 303, 304, 307, 544A.

    2. Section 15.247 is amended by adding a new paragraph (a)(1)(iii) 
and revising paragraph (b)(1) to read as follows:

Sec. 15.247  Operation within the bands 902-928 MHz, 2400-2483.5 MHz, 
and 5725-5850 MHz.

    (a) * * *
    (1) * * *
    (iii) Frequency hopping systems in the 2400--2483.5 MHz band may 
utilize hopping channels whose 20 dB bandwidth is greater than 1 MHz 
provided the systems use at least 15 non-overlapping channels. The 
total span of hopping channels shall be at least 75 MHz. The average 
time of occupancy on any one channel shall not be greater than 0.4 
seconds within the time period required to hop through all channels.
    (b) * * *
    (1) For frequency hopping systems in the 2400-2483.5 MHz band 
employing at least 75 hopping channels, all frequency hopping systems 
in the 5725-5850 MHz band, and all direct sequence systems: 1 watt. For 
all other frequency hopping systems in the 2400-2483.5 MHz band: 0.125 
watts.
* * * * *
[FR Doc. 00-24541 Filed 9-22-00; 8:45 am]
BILLING CODE 6712-01-P
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