[Federal Register Volume 73, Number 168 (Thursday, August 28, 2008)]
[Proposed Rules]
[Pages 50741-50751]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-20135]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Chapter I

[WC Docket No. 08-171; FCC 08-195]


Implementation of the New and Emerging Technologies 911 
Improvement Act of 2008

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Communications Commission (Commission) adopted a 
Notice of Proposed Rulemaking seeking comment on rules that must be 
adopted pursuant to the New and Emerging Technologies 911 Improvement 
Act of 2008 (NET 911 Act). This action is necessary because the NET 911 
Act commands us to issue certain regulations within 90 days of the NET 
911 Act's enactment. The intended effect of this action is to generate 
comment to guide the Commission when issuing those particular 
regulations.

DATES: Comments are due on or before September 9, 2008, and reply 
comments are due on or before September 17, 2008.

ADDRESSES: You may submit comments, identified by WC Docket No. 08-171, 
by any of the following methods:
    <bullet> Federal e-Rulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    <bullet> Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
    <bullet> E-mail: <a href="/cdn-cgi/l/email-protection#ed888e8b9ead8b8e8ec38a829b"><span class="__cf_email__" data-cfemail="bfdadcd9ccffd9dcdc91d8d0c9">[email protected]</span></a>, and include the following words in 
the body of the message, ``get form.'' A sample form and directions 
will be sent in response. Include the docket number(s) in the subject 
line of the message.
    <bullet> Mail: Secretary, Federal Communications Commission, 445 
12th Street, SW., Washington DC 20554.
    <bullet> Hand Delivery/Courier: 236 Massachusetts Avenue, NE., 
Suite 110, Washington, DC 20002.
    <bullet> People with Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by e-mail: <a href="/cdn-cgi/l/email-protection#52141111676266123431317c353d24"><span class="__cf_email__" data-cfemail="a6e0e5e5939692e6c0c5c588c1c9d0">[email protected]</span></a> or phone: 202-418-
0530 or TTY: 202-418-0432.
    All submissions received must include the agency name and docket 
number for this rulemaking, WC Docket No. 08-171. All comments received 
will be posted without change to http://www.fcc.gov/cgb/ecfs. For 
detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Matt Warner, Wireline Competition 
Bureau, (202) 418-1580.

SUPPLEMENTARY INFORMATION: Pursuant to sections 1.415 and 1.419 of the 
Commission's rules, 47 CFR 1.415, 1.419, interested parties may file 
comments and reply comments on or before the dates indicated on the 
first page of this document. Comments may be filed using: (1) The 
Commission's Electronic Comment Filing System (ECFS), (2) the Federal 
Government's e-Rulemaking Portal, or (3) by filing paper copies. See 
Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 
(1998).
    <bullet> Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ 
or the Federal e-Rulemaking Portal: http://www.regulations.gov. Filers 
should follow the instructions provided on the Web site for submitting 
comments.
    <bullet> For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to <a href="/cdn-cgi/l/email-protection#91f4f2f7e2d1f7f2f2bff6fee7"><span class="__cf_email__" data-cfemail="7f1a1c190c3f191c1c51181009">[email protected]</span></a>, and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
    <bullet> Paper Filers: Parties who choose to file by paper must 
file an original and

[[Page 50742]]

four copies of each filing. If more than one docket or rulemaking 
number appears in the caption of this proceeding, filers must submit 
two additional copies for each additional docket or rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail (although we continue to experience delays in receiving U.S. 
Postal Service mail). All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
    <bullet> The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
    <bullet> Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
    <bullet> U.S. Postal Service first-class, Express, and Priority 
mail must be addressed to 445 12th Street, SW., Washington, DC 20554.
    People with Disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an e-mail to <a href="/cdn-cgi/l/email-protection" class="__cf_email__" data-cfemail="395f5a5a0c090d795f5a5a175e564f">[email protected]</a> or call the 
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (tty).

Notice of Proposed Rulemaking

I. Introduction

    1. 911 service is critical to our nation's ability to respond to a 
host of crises. The New and Emerging Technologies (NET) 911 Improvement 
Act of 2008 (NET 911 Act), signed into law on July 23, 2008, is 
designed to ``promote and enhance public safety by facilitating the 
rapid deployment of IP-enabled 911 and E911 services, encourage the 
Nation's transition to a national IP-enabled emergency network, and 
improve 911 and enhanced 911 (E911) access to those with 
disabilities.'' This Notice of Proposed Rulemaking (NPRM) marks our 
first step towards implementing this new legislation.
    2. The NET 911 Act addresses several aspects of our nation's 911 
system. This NPRM focuses on one particular obligation in the NET 911 
Act: The Commission must, no later than October 21, 2008, issue 
regulations implementing certain key provisions that, among other 
things, ensure that providers of IP-enabled voice services have access 
to the capabilities they need to provide 911 and E911 service. We fully 
intend to have those regulations in place by Congress's deadline. 
Therefore we issue this NPRM and provide a short comment cycle that 
will allow us to meet our statutory obligation.

II. Background

    3. The NET 911 Act explicitly imposes on each IP-enabled voice 
service provider the obligation to provide 911 service and E911 service 
in accordance with Commission requirements. The NET 911 Act also grants 
each IP-enabled voice service provider rights with respect to 
``capabilities'' to provide 911 and E911 services. Specifically, 
section 102 of the NET 911 Act adds a new section 6 to the Wireless 911 
Act, which states in relevant part:

    (a) DUTIES.--It shall be the duty of each IP-enabled voice 
service provider to provide 9-1-1 service and enhanced 9-1-1 service 
to its subscribers in accordance with the requirements of the 
Federal Communications Commission, as in effect on the date of 
enactment of the New and Emerging Technologies 911 Improvement Act 
of 2008 and as such requirements may be modified by the Commission 
from time to time.
    (b) PARITY FOR IP-ENABLED VOICE SERVICE PROVIDERS.--An IP-
enabled voice service provider that seeks capabilities to provide 9-
1-1 and enhanced 9-1-1 service from an entity with ownership or 
control over such capabilities, to comply with its obligations under 
subsection (a), shall, for the exclusive purpose of complying with 
such obligations, have a right of access to such capabilities, 
including interconnection, to provide 9-1-1 and enhanced 9-1-1 
service on the same rates, terms, and conditions that are provided 
to a provider of commercial mobile service * * *, subject to such 
regulations as the Commission prescribes under subsection (c).
    (c) REGULATIONS.--The Commission--
    (1) within 90 days after the date of enactment of the [NET 911 
Act] shall issue regulations implementing such Act, including 
regulations that--
    (A) ensure that IP-enabled voice service providers have the 
ability to exercise their rights under subsection (b);
    (B) take into account any technical, network security, or 
information privacy requirements that are specific to IP-enabled 
voice services; and
    (C) provide, with respect to any capabilities that are not 
required to be made available to a commercial mobile service 
provider but that the Commission determines under subparagraph (B) 
of this paragraph or paragraph (2) are necessary for an IP-enabled 
voice service provider to comply with its obligations under 
subsection (a), that such capabilities shall be available at the 
same rates, terms, and conditions as would apply if such 
capabilities were made available to a commercial mobile service 
provider.
    (2) shall require IP-enabled voice service providers to which 
the regulations apply to register with the Commission and to 
establish a point of contact for public safety and government 
officials relative to 9-1-1 and enhanced 9-1-1 service and access * 
* *

    4. The ``requirements of the Federal Communications Commission, as 
in effect on the date of enactment of the [NET 911 Act]'' referenced in 
the legislation are set forth in the Commission's VoIP 911 Order. In 
that Order, the Commission required providers of ``interconnected VoIP 
service''--referred to as ``IP-enabled voice services'' in the NET 911 
Act--to provide 911 service using the existing wireline 911 
infrastructure. Congress has specified that ``[n]othing in the [NET 911 
Act] shall be construed as altering, delaying, or otherwise limiting 
the ability of the Commission to enforce the Federal actions taken or 
rules adopted obligating an IP-enabled voice service provider to 
provide 9-1-1 or enhanced 9-1-1 service as of the date of the enactment 
of the [NET 911 Act].''

III. Discussion

    5. In the discussion that follows, we seek comment on the specific 
duties imposed by the legislation and the elements of the regulations 
we are required to adopt. We ask about the capabilities for which the 
NET 911 Act affords IP-enabled voice service providers a right of 
access, how the Commission can ensure that IP-enabled voice service 
providers can exercise these rights, and how to provide that such 
capabilities are made available on the same rates, terms, and 
conditions that are provided to commercial mobile service providers. We 
also explore how the regulations we must adopt are impacted by 
requirements specific to IP-enable voice service providers. We seek 
comment, generally, on the questions and tentative conclusions below.
A. ``Capabilities''
    6. The NET 911 Act states that IP-enabled voice service providers 
``shall * * * have a right of access to such capabilities, including 
interconnection, to provide 9-1-1 and enhanced 9-1-1 service on the 
same rates, terms, and conditions that are provided to CMS providers.'' 
To what extent is it appropriate for the Commission to define 
``capabilities'' in this rulemaking, or should we determine what 
constitutes ``capabilities'' on a case-by-case basis? To the extent a 
prospective determination is appropriate, we seek comment on the 
definition of

[[Page 50743]]

``capabilities.'' What would such a definition include and exclude? Are 
pseudo Automatic Number Identification (p-ANI), real-time Automatic 
Location Identification (ALI) database access, Emergency Service 
Numbers (ESN), Master Street Address Guides (MSAG), shell records, 
callback number, selective router interconnection for both voice and 
data transport, or other ``elements'' appropriately considered 
``capabilities'' under the NET 911 Act? Do ``capabilities'' include 
network services, testing, and agreements? What other items, elements, 
features, functions, or agreements are appropriately considered 
capabilities? Because the NET 911 Act requires IP-enabled service 
providers to ``have a right of access'' to capabilities to provide 911 
and enhanced 911 service ``on the same rates, terms, and conditions 
that are provided to a provider of commercial mobile service,'' we seek 
comment about what capabilities are currently required to be available 
to CMS providers. What, if any, capabilities ``are necessary for an IP-
enabled voice service provider to comply with its obligations'' under 
section 6(a) of the Wireless 911 Act, but ``are not required to be made 
available to a commercial mobile service provider''?
    7. With regard to mobile VoIP service used by CMRS carriers in 
conjunction with their CMRS service, we seek comment specifically on 
what capabilities ``are necessary for [such mobile interconnected VoIP] 
provider to comply with its obligations'' under section 6(a) of the 
Wireless 911 Act. Specifically, what requirements should be imposed on 
the mobile VoIP provider and its roaming partner when offering mobile 
VoIP service in a roaming area outside its CMRS footprint? For example, 
T-Mobile has asked the Commission to waive or rule on several 
requirements of the VoIP 911 Order for its interconnected VoIP service, 
which allows a customer to use a dual-mode handset that works as a 
regular CMRS phone and, when it is in a WiFi hotspot, an interconnected 
VoIP phone. Its service uses CMRS default routing for VoIP 911 calls 
and ``last known cell'' information for automatic location information 
in its footprint, but is not able to use such ``last known cell'' 
information outside the footprint because it is not provided by its 
roaming partner. Assuming that T-Mobile's use of CMRS default routing 
and associated ``last known cell'' information is sufficient, we seek 
comment on what modifications we should make to our rules when outside 
the footprint. For example, what requirements should be placed on the 
roaming partners of these dual-mode service providers to provide access 
to information necessary to employ ``last known cell'' in a roaming 
area in the same manner that dual-mode providers such as T-Mobile use 
such information when in its own network? Further, we seek comment 
generally on what capabilities we should require roaming partners to 
make available to mobile VoIP providers to ensure compliance with 
applicable 911 and E911 requirements. In addition, we seek comment on 
whether wireless carriers should be required pursuant to the NET 911 
Act to provide roaming partners with last-known caller location 
information necessary for the proper routing of wireless VoIP calls to 
911. We also seek comment on how such a requirement would affect 
incentives to reach roaming agreements and how the Commission can 
ensure that such a requirement would not prevent companies from forming 
roaming agreements they might otherwise reach.
B. Ownership, Control, Availability, and Right of Access
    8. Who owns and controls each of the capabilities identified in 
response to the questions above? For each type of entity owning or 
controlling such capabilities, how should the Commission fulfill its 
statutory mandate to ``ensure that IP-enabled voice service providers 
have the ability to exercise their rights under subsection (b)''? Does 
this mandate confer sufficient authority or jurisdiction upon the 
Commission to impose requirements on state, local or private entities? 
What other sources of authority or jurisdiction are available to the 
Commission to ensure that such capabilities are made available? Are 
there any additional actions the Commission should take to ensure that 
such capabilities are available per Congress's instructions? What are 
the implications of Congress's direction that IP-enabled voice service 
providers shall have a right of access to these capabilities ``for the 
exclusive purpose of complying with'' their obligations under the NET 
911 Act?
C. Rates, Terms, and Conditions
    9. The NET 911 Act requires that IP-enabled voice service providers 
receive a right of access to E911 network capabilities on the ``same 
rates, terms, and conditions'' as provided to CMS providers. Under what 
rates, terms, and conditions are such capabilities provided to CMS 
providers? To what extent are capabilities made available to CMS 
providers under tariff, interconnection agreement, or some other form 
of agreement? To what extent are the terms of such agreements available 
for review by other CMS providers or providers of IP-enabled voice 
service?
    10. Assuming that similar capabilities have varying rates, terms, 
and conditions, how should the Commission determine what rates, terms, 
and conditions are to be placed on certain capabilities? Is it enough 
to mandate in our rules that those entities owning or controlling the 
capabilities needed for IP-enabled voice service providers provide such 
capabilities at the same rates, terms and conditions offered to CMS 
providers? Conversely, is it necessary to establish pricing standards 
for each of the capabilities that an IP-enabled voice service provider 
needs to meet the NET 911 Act's section 101(2) obligations? If so, what 
standards should apply? Can and should the Commission mandate 
disclosure of all rates, terms, and conditions concerning each 
capability from states, localities, and industry? How shall the 
Commission determine what rates, terms, and conditions would have been 
made available to CMS providers for capabilities that they do not use? 
Are there any other differences between CMS and IP-enabled voice 
service that we should consider with regard to the ``rates, terms, and 
conditions'' of access for IP-enabled voice service providers?
D. Technical, Network Security, or Information Privacy Requirements 
That Are Specific to IP-Enabled Voice Services
    11. What technical, network security, or information privacy 
requirements specific to IP-enabled voice services must be taken into 
account when ensuring that capabilities are available to IP-enabled 
voice service providers? Are there any concerns that certain 911 
systems may not offer the capabilities necessary particularly to meet 
the technical requirements of IP-enable voice services? If so, how 
should we take into account these requirements when adopting 
regulations for IP-enabled voice service providers? What network 
security issues do providers of IP-enabled voice services pose for the 
911 and E911 networks? What steps can the Commission take to correct or 
ameliorate these concerns? With respect to information privacy, are 
there any issues specific to IP-enabled voice service providers that 
raise new concerns regarding the protection of customer proprietary 
network information? What steps should the Commission take to ensure 
IP-enabled voice service providers' customers' information is protected 
during and

[[Page 50744]]

after a 911 or E911 call? Should the Commission take any action at this 
time to require IP-enabled voice service providers to register with the 
Commission and to establish a point of contact for public safety and 
government officials relative to 911 and E911 service and access? If 
so, what steps would be appropriate?
E. Other Considerations
    12. Finally, what other issues relating to the NET 911 Act should 
the Commission consider? Are there particular issues relating to the 
Commission's jurisdiction, federal, state, local and private 
initiatives, or other issues that the Commission should take into 
consideration when adopting rules? Should the Commission delegate 
authority to enforce any regulations issued under subsection (c) to 
State commissions or other State or local agencies or programs with 
jurisdiction over emergency communications? If so, what specifically 
should the Commission delegate and to which entity? What costs and 
burdens would rules resulting from the NPRM impose upon small entities 
and how can they be ameliorated? Are there any other issues or 
significant alternatives that the Commission should consider to ease 
the burden on small entities?

Initial Regulatory Flexibility Analysis

    13. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared the present Initial 
Regulatory Flexibility Analysis (IRFA) of the possible significant 
economic impact on small entities that might result from today's NPRM. 
Written public comments are requested on this IRFA. Comments must be 
identified as responses to the IRFA and must be filed by the deadlines 
for comments on the NPRM provided above. The Commission will send a 
copy of the NPRM, including this IRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration. In addition, the NPRM 
and IRFA (or summaries thereof) will be published in the Federal 
Register.

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

    14. In the NPRM, the Commission considers how to best make 911 
capabilities available to IP-enabled voice service providers at the 
same rates, terms, and conditions available to commercial mobile 
service (CMS) providers. Specifically, the Commission seeks comments 
regarding its need to issue regulations within 90 days of NET 911 Act's 
enactment, including regulations that:
    (A) Ensure that IP-enabled voice service providers have the ability 
to exercise their rights under subsection (b);
    (B) Take into account any technical, network security, or 
information privacy requirements that are specific to IP-enabled voice 
services; and
    (C) Provide, with respect to any capabilities that are not required 
to be made available to a commercial mobile service provider but that 
the Commission determines * * * are necessary for an IP-enabled voice 
service provider to comply with its obligations [to provide 911 service 
and enhanced 911 service], that such capabilities shall be available at 
the same rates, terms, and conditions as would apply if such 
capabilities were made available to a commercial mobile service 
provider.
    For each of these issues, the Commission also seeks comment on the 
burdens, including those placed on small carriers, associated with 
corresponding Commission rules related to each issue and whether there 
are alternative rules that might lessen any burden.

B. Legal Basis

    15. The legal basis for any action that may be taken pursuant to 
the NPRM is contained in sections 1, 4(i)-(j), 201, 202, 222, 251, 252, 
303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 
154(i)-(j), 201, 202, 222, 251, 252, 303(r), and section 6 of the 
Wireless 911 Act, as amended.

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

    16. 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 rules adopted herein. 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 Small Business 
Administration (SBA).
1. Wireline Carriers and Service Providers
    17. Incumbent Local Exchange Carriers (ILECs). 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 engaged in the 
provision of local exchange services. Of these 1,307 carriers, an 
estimated 1,019 have 1,500 or fewer employees and 288 have more than 
1,500 employees. Consequently, the Commission estimates that most 
providers of incumbent local exchange service are small businesses that 
may be affected by our action.
    18. Competitive Local Exchange Carriers (CLECs). 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, 859 carriers reported that they were engaged in the 
provision of either competitive local exchange carrier or competitive 
access provider services. Of these 859 carriers, an estimated 741 have 
1,500 or fewer employees and 118 have more than 1,500 employees. In 
addition, 16 carriers have reported that they are ``Shared-Tenant 
Service Providers,'' and all 16 are estimated to have 1,500 or fewer 
employees. In addition, 44 carriers have reported that they are ``Other 
Local Service Providers.'' Of the 44, an estimated 43 have 1,500 or 
fewer employees and one has more than 1,500 employees. Consequently, 
the Commission estimates that most providers of competitive local 
exchange service, competitive access providers, ``Shared-Tenant Service 
Providers,'' and ``Other Local Service Providers'' are small entities 
that may be affected by our action.
    19. We have included small incumbent local exchange carriers (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 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

[[Page 50745]]

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.
    20. 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, 184 carriers have reported 
that they are engaged in the provision of local resale services. Of 
these, an estimated 181 have 1,500 or fewer employees and three have 
more than 1,500 employees. Consequently, the Commission estimates that 
the majority of local resellers are small entities that may be affected 
by our action.
    21. 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 853 have 1,500 or fewer employees and 28 have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of toll resellers are small entities that may be affected by 
our action.
    22. Payphone Service Providers (PSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
payphone services providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 657 carriers have reported 
that they are engaged in the provision of payphone services. Of these, 
an estimated 653 have 1,500 or fewer employees and four have more than 
1,500 employees. Consequently, the Commission estimates that the 
majority of payphone service providers are small entities that may be 
affected by our action.
    23. 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, 330 companies reported 
that their primary telecommunications service activity was the 
provision of interexchange services. Of these 330 companies, an 
estimated 309 have 1,500 or fewer employees and 21 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 our action.
    24. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 23 carriers have reported that 
they are engaged in the provision of operator services. Of these, an 
estimated 22 have 1,500 or fewer employees and one has more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
OSPs are small entities that may be affected by our action.
    25. 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, 104 carriers have reported that they are 
engaged in the provision of prepaid calling cards. Of these, an 
estimated 102 have 1,500 or fewer employees and two 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 our action.
    26. 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, at the beginning of July 
2006, the number of 800 numbers assigned was 7,647,941; the number of 
888 numbers assigned was 5,318,667; the number of 877 numbers assigned 
was 4,431,162; and the number of 866 numbers assigned was 6,008,976. 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 
7,647,941 or fewer small entity 800 subscribers; 5,318,667 or fewer 
small entity 888 subscribers; 4,431,162 or fewer small entity 877 
subscribers; and 5,318,667 or fewer small entity 866 subscribers.
2. Wireless Carriers and Service Providers
    27. Below, for those services subject to auctions, we note that, as 
a general matter, the number of winning bidders that qualify as small 
businesses at the close of an auction does not necessarily represent 
the number of small businesses currently in service. Also, the 
Commission does not generally track subsequent business size unless, in 
the context of assignments or transfers, unjust enrichment issues are 
implicated.
    28. Wireless Telecommunications Carriers (except Satellite). Since 
2007, the SBA has recognized wireless firms within this new, broad, 
economic census category. Prior to that time, the SBA had developed a 
small business size standard for wireless firms within the now-
superseded census 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. Because Census Bureau data are not yet available for 
the new category, we will estimate small business prevalence using the 
prior categories and associated data. For the first category of Paging, 
data for 2002 show that there were 807 firms that operated for the 
entire year. Of this total, 804 firms had employment of 999 or fewer 
employees, and three firms had employment of 1,000 employees or more. 
For the second category of Cellular and Other Wireless 
Telecommunications, data for 2002 show that there were 1,397 firms that 
operated for the entire year. Of this total, 1,378 firms had employment 
of 999 or fewer employees, and 19 firms had employment of 1,000 
employees or more. Thus, using the prior categories and the available 
data, we estimate that the majority of wireless firms can be

[[Page 50746]]

considered small. According to Commission data, 432 carriers reported 
that they were engaged in the provision of cellular service, Personal 
Communications Service (PCS), or Specialized Mobile Radio (SMR) 
Telephony services, which are placed together in the data. We have 
estimated that 221 of these are small, under the SBA small business 
size standard. Thus, under this category and size standard, about half 
of firms can be considered small. This information is also included in 
paragraph 23.
    29. Common Carrier Paging. The SBA has developed a small business 
size standard for Paging, under which a business is small if it has 
1,500 or fewer employees. According to Commission data, 365 carriers 
have reported that they are engaged in Paging or Messaging Service. Of 
these, an estimated 360 have 1,500 or fewer employees, and 5 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. In addition, 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. An auction of 
Metropolitan Economic Area licenses commenced on February 24, 2000, and 
closed on March 2, 2000. Of the 985 licenses auctioned, 440 were sold. 
Fifty-seven companies claiming small business status won.
    30. Wireless Communications Services. This service can be used for 
fixed, mobile, radiolocation, and digital audio broadcasting satellite 
uses. The Commission established small business size standards for the 
wireless communications services (WCS) auction. A ``small business'' is 
an entity with average gross revenues of $40 million for each of the 
three preceding years, and a ``very small business'' is an entity with 
average gross revenues of $15 million for each of the three preceding 
years. The SBA has approved these small business size standards. The 
Commission auctioned geographic area licenses in the WCS service. In 
the auction, held in April 1997, there were seven winning bidders that 
qualified as ``very small business'' entities, and one that qualified 
as a ``small business'' entity.
    31. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services (PCS), and specialized mobile radio 
(SMR) telephony carriers. As noted earlier, the SBA has developed a 
small business size standard for ``Cellular and Other Wireless 
Telecommunications'' services. Under that SBA small business size 
standard, a business is small if it has 1,500 or fewer employees. 
According to Commission data, 432 carriers reported that they were 
engaged in the provision of wireless telephony. We have estimated that 
221 of these are small under the SBA small business size standard.
    32. 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. On March 23, 
1999, the Commission re-auctioned 347 C, D, E, and F Block licenses. 
There were 48 small business winning bidders. On January 26, 2001, the 
Commission completed the auction of 422 C and F Broadband PCS licenses 
in Auction No. 35. Of the 35 winning bidders in this auction, 29 
qualified as ``small'' or ``very small'' businesses. Subsequent events, 
concerning Auction 35, including judicial and agency determinations, 
resulted in a total of 163 C and F Block licenses being available for 
grant.
    33. Narrowband Personal Communications Services. To date, two 
auctions of narrowband personal communications services (PCS) licenses 
have been conducted. For purposes of the two auctions that have already 
been held, ``small businesses'' were entities with average gross 
revenues for the prior three calendar years of $40 million or less. 
Through these auctions, the Commission has awarded a total of 41 
licenses, out of which 11 were obtained by small businesses. To ensure 
meaningful participation of small business entities in future auctions, 
the Commission has 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. In the future, the 
Commission will auction 459 licenses to serve Metropolitan Trading 
Areas (MTAs) and 408 response channel licenses. There is also one 
megahertz of narrowband PCS spectrum that has been held in reserve and 
that the Commission has not yet decided to release for licensing. The 
Commission cannot predict accurately the number of licenses that will 
be awarded to small entities in future actions. However, four of the 16 
winning bidders in the two previous narrowband PCS auctions were small 
businesses, as that term was defined under the Commission's Rules. The 
Commission assumes, for purposes of this analysis, that a large portion 
of the remaining narrowband PCS licenses will be awarded to small 
entities. The Commission also assumes that at least some small 
businesses will acquire narrowband PCS licenses by means of the 
Commission's partitioning and disaggregation rules.
    34. 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 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 ``Cellular and Other

[[Page 50747]]

Wireless Telecommunications'' companies. 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.
    35. 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 
a new service, and 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.
    36. 800 MHz and 900 MHz Specialized Mobile Radio Licenses. The 
Commission awards ``small entity'' and ``very small entity'' bidding 
credits in auctions for Specialized Mobile Radio (SMR) geographic area 
licenses in the 800 MHz and 900 MHz bands to firms that had revenues of 
no more than $15 million in each of the three previous calendar years, 
or that had revenues of no more than $3 million in each of the previous 
calendar years, respectively. These bidding credits apply to SMR 
providers in the 800 MHz and 900 MHz bands that either hold geographic 
area licenses or have obtained extended implementation authorizations. 
The Commission does not know how many firms provide 800 MHz or 900 MHz 
geographic area SMR service pursuant to extended implementation 
authorizations, nor how many of these providers have annual revenues of 
no more than $15 million. One firm has over $15 million in revenues. 
The Commission assumes, for purposes here, that all of the remaining 
existing extended implementation authorizations are held by small 
entities, as that term is defined by the SBA. The Commission has held 
auctions for geographic area licenses in the 800 MHz and 900 MHz SMR 
bands. There were 60 winning bidders that qualified as small or very 
small entities in the 900 MHz SMR auctions. Of the 1,020 licenses won 
in the 900 MHz auction, bidders qualifying as small or very small 
entities won 263 licenses. In the 800 MHz auction, 38 of the 524 
licenses won were won by small and very small entities.
    37. 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 $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. 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.
    38. 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). The Commission uses 
the SBA's small business size standard applicable to ``Cellular and 
Other Wireless Telecommunications,'' 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 adopted herein.
    39. 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 ``Cellular and Other Wireless Telecommunications,'' 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.
    40. 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 ``Cellular and Other 
Telecommunications,'' which is 1,500 or fewer 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.
    41. Fixed Microwave Services. Fixed microwave services include 
common

[[Page 50748]]

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 the category ``Cellular and Other Telecommunications,'' 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 noted, however, that the common carrier 
microwave fixed licensee category includes some large entities.
    42. 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. We are unable to estimate at this time the number of licensees 
that would qualify as small under the SBA's small business size 
standard for ``Cellular and Other Wireless Telecommunications'' 
services. Under that SBA small business size standard, a business is 
small if it has 1,500 or fewer employees.
    43. 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 our action.
    44. Wireless Cable Systems. Wireless cable systems use 2 GHz band 
frequencies of the Broadband Radio Service (BRS), formerly Multipoint 
Distribution Service (MDS), and the Educational Broadband Service 
(EBS), formerly Instructional Television Fixed Service (ITFS), to 
transmit video programming and provide broadband services to 
residential subscribers. These services were originally designed for 
the delivery of multichannel video programming, similar to that of 
traditional cable systems, but over the past several years licensees 
have focused their operations instead on providing two-way high-speed 
Internet access services. We estimate that the number of wireless cable 
subscribers is approximately 100,000, as of March 2005. Local 
Multipoint Distribution Service (LMDS) is a fixed broadband point-to-
multipoint microwave service that provides for two-way video 
telecommunications. As described below, the SBA small business size 
standard for the broad census category of Cable and Other Program 
Distribution, which consists of such entities generating $13.5 million 
or less in annual receipts, appears applicable to MDS, ITFS and LMDS. 
Other standards also apply, as described.
    45. The Commission has defined small MDS (now BRS) and LMDS 
entities in the context of Commission license auctions. In the 1996 MDS 
auction, the Commission defined a small business as an entity that had 
annual average gross revenues of less than $40 million in the previous 
three calendar years. This definition of a small entity in the context 
of MDS auctions has been approved by the SBA. In the MDS auction, 67 
bidders won 493 licenses. Of the 67 auction winners, 61 claimed status 
as a small business. At this time, the Commission estimates that of the 
61 small business MDS auction winners, 48 remain small business 
licensees. In addition to the 48 small businesses that hold BTA 
authorizations, there are approximately 392 incumbent MDS licensees 
that have gross revenues that are not more than $40 million and are 
thus considered small entities. MDS licensees and wireless cable 
operators that did not receive their licenses as a result of the MDS 
auction fall under the SBA small business size standard for Cable and 
Other Program Distribution. Information available to us indicates that 
there are approximately 850 of these licensees and operators that do 
not generate revenue in excess of $13.5 million annually. Therefore, we 
estimate that there are approximately 850 small entity MDS (or BRS) 
providers, as defined by the SBA and the Commission's auction rules.
    46. Educational institutions are included in this analysis as small 
entities; however, the Commission has not created a specific small 
business size standard for ITFS (now EBS). We estimate that there are 
currently 2,032 ITFS (or EBS) licensees, and all but 100 of the 
licenses are held by educational institutions. Thus, we estimate that 
at least 1,932 ITFS licensees are small entities.
    47. In the 1998 and 1999 LMDS auctions, the Commission defined a 
small business as an entity that has annual average gross revenues of 
less than $40 million in the previous three calendar years. Moreover, 
the Commission added an additional classification for a ``very small 
business,'' which was defined as an entity that had annual average 
gross revenues of less than $15 million in the previous three calendar 
years. These definitions of ``small business'' and ``very small 
business'' in the context of the LMDS auctions have been approved by 
the SBA. In the first LMDS auction, 104 bidders won 864 licenses. Of 
the 104 auction winners, 93 claimed status as small or very small 
businesses. In the LMDS re-auction, 40 bidders won 161 licenses. Based 
on this information, we believe that the number of small LMDS licenses 
will include the 93 winning bidders in the first auction and the 40 
winning bidders in the re-auction, for a total of 133 small entity LMDS 
providers as defined by the SBA and the Commission's auction rules.
    48. 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 carryover 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,

[[Page 50749]]

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.
    49. 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. The 
applicable SBA small business size standard is that of ``Cellular and 
Other Wireless Telecommunications'' companies. This category provides 
that such a company is small if it employs no more than 1,500 persons. 
We believe 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.
    50. 24 GHz--Future Licensees. With respect to new applicants in the 
24 GHz band, the small business 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 the future auction, if held.
3. Satellite Service Providers
    51. Satellite Telecommunications. Since 2007, the SBA has 
recognized satellite firms within this revised category, with a small 
business size standard of $13.5 million. The most current Census Bureau 
data, however, are from the (last) economic census of 2002, 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 both prior categories, such a business was considered small if it 
had, as now, $13.5 million or less in average annual receipts.
    52. 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 2002 show that there were a total of 371 firms that 
operated for the entire year. Of this total, 307 firms had annual 
receipts of under $10 million, and 26 firms had receipts of $10 million 
to $24,999,999. Consequently, we estimate that the majority of 
Satellite Telecommunications firms are small entities that might be 
affected by our action.
    53. The second category of Other Telecommunications ``comprises 
establishments primarily engaged in (1) providing specialized 
telecommunications applications, such as satellite tracking, 
communications telemetry, and radar station operations; or (2) 
providing satellite terminal stations and associated facilities 
operationally connected with one or more terrestrial communications 
systems and capable of transmitting telecommunications to or receiving 
telecommunications from satellite systems.'' For this category, Census 
Bureau data for 2002 show that there were a total of 332 firms that 
operated for the entire year. Of this total, 303 firms had annual 
receipts of under $10 million and 15 firms had annual receipts of $10 
million to $24,999,999. Consequently, we estimate that the majority of 
Other Telecommunications firms are small entities that might be 
affected by our action.
4. Cable and OVS Operators
    54. In 2007, the SBA recognized new census categories for small 
cable entities. However, there is no census data yet in existence that 
may be used to calculate the number of small entities that fit these 
definitions. Therefore, we will use prior definitions of these types of 
entities in order to estimate numbers of potentially affected small 
business entities. In addition to the estimates provided above, we 
consider certain additional entities that may be affected by the data 
collection from broadband service providers. Because section 706 
requires us to monitor the deployment of broadband regardless of 
technology or transmission media employed, we anticipate that some 
broadband service providers will not provide telephone service. 
Accordingly, we describe below other types of firms that may provide 
broadband services, including cable companies, MDS providers, and 
utilities, among others.
    55. Cable and Other Program Distribution. The Census Bureau defines 
this category as follows: ``This industry comprises establishments 
primarily engaged as third-party distribution systems for broadcast 
programming. The establishments of this industry deliver visual, aural, 
or textual programming received from cable networks, local television 
stations, or radio networks to consumers via cable or direct-to-home 
satellite systems on a subscription or fee basis. These establishments 
do not generally originate programming material.'' The SBA has 
developed a small business size standard for Cable and Other Program 
Distribution, which is: All such firms having $13.5 million or less in 
annual receipts. According to Census Bureau data for 2002, there were a 
total of 1,191 firms in this category that operated for the entire 
year. Of this total, 1,087 firms had annual receipts of under $10 
million, and 43 firms had receipts of $10 million or more but less than 
$25 million. Thus, under this size standard, the majority of firms can 
be considered small.
    56. Cable Companies and Systems. The Commission has also 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 under 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.
    57. Cable System Operators. The Communications Act of 1934, as 
amended, also contains a size standard for small cable system 
operators, which is ``a cable operator that, directly or through an 
affiliate, serves in the aggregate fewer than 1 percent of all 
subscribers in the United States and is not affiliated with any entity 
or entities whose gross annual revenues in the aggregate exceed 
$250,000,000.'' 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

[[Page 50750]]

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.
    58. Open Video Services. Open Video Service (OVS) systems provide 
subscription services. As noted above, the SBA has created a small 
business size standard for Cable and Other Program Distribution. This 
standard provides that a small entity is one with $13.5 million or less 
in annual receipts. The Commission has certified approximately 45 OVS 
operators to serve 75 areas, and some of these are currently providing 
service. Affiliates of Residential Communications Network, Inc. (RCN) 
received approval to operate OVS systems in New York City, Boston, 
Washington, DC and other areas. RCN has sufficient revenues to assure 
that they do not qualify as a small business entity. Little financial 
information is available for the other entities that are authorized to 
provide OVS and are not yet operational. Given that some entities 
authorized to provide OVS service have not yet begun to generate 
revenues, the Commission concludes that up to 44 OVS operators (those 
remaining) might qualify as small businesses that may be affected by 
the rules and policies adopted herein.
5. Electric Power Generation, Transmission and Distribution
    59. Electric Power Generation, Transmission, and Distribution. The 
Census Bureau defines this category as follows: ``This industry group 
comprises establishments primarily engaged in generating, transmitting, 
and/or distributing electric power. Establishments in this industry 
group may perform one or more of the following activities: (1) Operate 
generation facilities that produce electric energy; (2) operate 
transmission systems that convey the electricity from the generation 
facility to the distribution system; and (3) operate distribution 
systems that convey electric power received from the generation 
facility or the transmission system to the final consumer.'' The SBA 
has developed a small business size standard for firms in this 
category: ``A firm is small if, including its affiliates, it is 
primarily engaged in the generation, transmission, and/or distribution 
of electric energy for sale and its total electric output for the 
preceding fiscal year did not exceed 4 million megawatt hours.'' 
According to Census Bureau data for 2002, there were 1,644 firms in 
this category that operated for the entire year. Census data do not 
track electric output and we have not determined how many of these 
firms fit the SBA size standard for small, with no more than 4 million 
megawatt hours of electric output. Consequently, we estimate that 1,644 
or fewer firms may be considered small under the SBA small business 
size standard.
6. Internet Service Providers, Web Portals, and Other Information 
Services
    60. In 2007, the SBA recognized two new small business, economic 
census categories. They are (1) Internet Publishing and Broadcasting 
and Web Search Portals, and (2) All Other Information Services. 
However, there is no census data yet in existence that may be used to 
calculate the number of small entities that fit these definitions. 
Therefore, we will use prior definitions of these types of entities in 
order to estimate numbers of potentially affected small business 
entities.
    61. Internet Service Providers. The SBA has developed a small 
business size standard for Internet Service Providers (ISPs). ISPs 
``provide clients access to the Internet and generally provide related 
services such as Web hosting, Web page designing, and hardware or 
software consulting related to Internet connectivity.'' Under the SBA 
size standard, such a business is small if it has average annual 
receipts of $23 million or less. According to Census Bureau data for 
2002, there were 2,529 firms in this category that operated for the 
entire year. Of these, 2,437 firms had annual receipts of under $10 
million, and an additional 47 firms had receipts of between $10 million 
and $24,999,999. Consequently, we estimate that the majority of these 
firms are small entities that may be affected by our action.
    62. Web Search Portals. Our action pertains to interconnected VoIP 
services, which could be provided by entities that provide other 
services such as e-mail, 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 ``operate Web 
sites that use a search engine to generate and maintain extensive 
databases of Internet addresses and content in an easily searchable 
format. Web search portals often provide additional Internet services, 
such as e-mail, connections to other Web sites, auctions, news, and 
other limited content, and serve as a home base for Internet users.'' 
The SBA has developed a small business size standard for this category; 
that size standard is $6.5 million or less in average annual receipts. 
According to Census Bureau data for 2002, there were 342 firms in this 
category that operated for the entire year. Of these, 303 had annual 
receipts of under $5 million, and an additional 15 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.
    63. 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 $23 million or less 
in average annual receipts. According to Census Bureau data for 2002, 
there were 6,877 firms in this category that operated for the entire 
year. Of these, 6,418 had annual receipts of under $10 million, and an 
additional 251 firms had receipts of between $10 million and 
$24,999,999. Consequently, we estimate that the majority of these firms 
are small entities that may be affected by our action.
    64. All Other Information Services. ``This industry comprises 
establishments primarily engaged in providing other information 
services (except new syndicates and libraries and archives).'' Our 
action pertains to interconnected VoIP services, which could be 
provided by entities that provide other services such as e-mail, 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 $6.5 million or 
less in average annual receipts. According to Census Bureau data for 
2002, there were 155 firms in this category that operated for the 
entire year. Of these, 138 had annual receipts of under $5 million, and 
an additional four 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.
    65. Internet Publishing and Broadcasting. ``This industry comprises 
establishments engaged in publishing and/or broadcasting content on the 
Internet exclusively. These establishments do not provide traditional 
(non-Internet) versions of the content that they publish or 
broadcast.'' The SBA has developed a small

[[Page 50751]]

business size standard for this census category; that size standard is 
500 or fewer employees. According to Census Bureau data for 2002, there 
were 1,362 firms in this category that operated for the entire year. Of 
these, 1,351 had employment of 499 or fewer employees, and six firms 
had employment of between 500 and 999. Consequently, we estimate that 
the majority of these firms small entities that may be affected by our 
action.
D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities
    66. Any potential proposals from this NPRM will not impose 
reporting or recordkeeping requirements that would be subject to the 
Paperwork Reduction Act. Therefore, we have not attempted here to 
provide an estimate in terms of burden hours. Rather, we are asking 
commenters to provide the Commission with reliable information and 
comments on any costs and burdens on small entities.
E. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered
    67. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its proposed approach, 
which may include (among others) the following four alternatives: (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.
    68. As noted above, the NPRM invites comment on regulations that 
the Commission must implement 90 days after the 911 NET Act's 
enactment, including regulations that:
    (A) Ensure that IP-enabled voice service providers have the ability 
to exercise their rights under subsection (b);
    (B) Take into account any technical, network security, or 
information privacy requirements that are specific to IP-enabled voice 
services; and
    (C) Provide, with respect to any capabilities that are not required 
to be made available to a commercial mobile service provider but that 
the Commission determines * * * are necessary for an IP-enabled voice 
service provider to comply with its obligations [to provide 911 service 
and enhanced 911 service], that such capabilities shall be available at 
the same rates, terms, and conditions as would apply if such 
capabilities were made available to a commercial mobile service 
provider.
    69. Specifically, we invite comment regarding how the Commission 
could ease any potential burden on small entities. The Commission seeks 
comment on significant alternatives and recommends that small entities 
file comments in response to the NPRM. We anticipate that the record 
will be developed concerning alternative ways in which the Commission 
could lessen the burden on classes of carrier or entities.
F. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules
    70. None.

Initial Paperwork Reduction Act of 1995 Analysis

    71. This document does not contain proposed information 
collection(s) subject to the Paperwork Reduction Act of 1995 (PRA), 
Public Law 104-13. In addition, therefore, it does not contain any new 
or modified ``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).

Ordering Clauses

    72. Accordingly, it is ordered that pursuant to the authority 
contained in sections 1, 4(i)-(j), 201, 202, 222, 251, 252, and 303(r) 
of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i)-
(j), 201, 202, 222, 251, 252, 303(r), and section 6 of the Wireless 911 
Act, as amended, this Notice of Proposed Rulemaking is adopted.
    73. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Notice of Proposed Rulemaking, including the Initial 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of 
the Small Business Administration.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E8-20135 Filed 8-27-08; 8:45 am]
BILLING CODE 6712-01-P


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