Legislative Activity

House Commerce Committee Releases GOP Policy Proposals

On December 29, 2014, House Energy and Commerce Committee Chairman Fred Upton (R-MI) released a set of policy papers entitled “GOP Solutions:  A Compilation of Policy Proposals from the House Committee on Energy and Commerce.” It is a compilation of prior papers issued by the Committee during the 113th Congress as well as new papers through which the Committee intends to build its policy work in the coming year. Two of the new papers address communications topics.

A paper entitled “Good Process Makes Good Policy: Reforming the FCC” addressed Federal Communications Commission (FCC) process reform, finding that long-term reform can only be achieved through legislation. It discussed the FCC Process Reform Act (H.R. 3675), which the House of Representatives passed in March 2014, but the Senate did not pass, and described the proposed reforms and procedural changes in this legislation.

In a second new paper entitled “Making the Most of America’s Airwaves: Government Spectrum Policy,” the Committee noted that work must be done to ensure that all spectrum users, including the federal government, are using assigned airwaves effectively and efficiently and to extract additional spectrum from less efficient uses for more innovative and productive uses. The Committee encouraged discussion concerning appropriate management of federal and commercial spectrum through licensing and authorizing and emphasized the need for creative solutions for spectrum policy to meet the ever-increasing demand for spectrum.

House Commerce Committee Announces Series of Hearings on Threats to the Digital Economy and E-Commerce

In response to recent coverage of the alleged cyber attack against Sony Pictures, Chairman Upton announced on December 19, 2014 that the House Energy and Commerce Committee will hold a series of hearings in 2015 to focus on the effects of cyber crimes on the economy and electronic commerce in particular. The hearings, the dates for which have not been announced, will bring together much of the Committee’s prior work concerning cybersecurity, technology, consumer information, and Internet governance and security.

Congress Approves Omnibus Appropriations Bill for 2015

The omnibus appropriations bill for the 2015 fiscal year that Congress passed and President Obama signed in December 2014 includes a $1.1 trillion dollar spending package that will keep most of the government funded through September 2015. The National Institute of Standards and Technology (NIST) received funding of $676 million, a $25 million increase from its 2014 funding levels. The increased funding will allow NIST to implement policy initiatives that will spur innovation, develop measurements, and provide resources to promote competitiveness of U.S. manufacturers globally. The FCC received $340 million, the same as it did in 2014.

Upton and Walden Release #CommActUpdate White Paper on Video Policy

On December 10, 2014, House Energy and Commerce Committee Chairman Upton and Rep. Greg Walden (R-OR) released a white paper exploring the laws governing the market for video content distribution. It notes that the proliferation of the numbers and types of video service providers has created increased competition for customers in the subscription video market. Increased competition has created barriers to entry for new market participants.  In addition, over-the-top (OTT) video providers have begun to compete with traditional offerings that bundle content with delivery mechanisms. Finding that the video market has become increasingly fractured both in terms of services and the regulatory environment, the paper seeks comments on how to change existing rules and regulations to reflect the new video marketplace. While the paper seeks comments on video content distribution, it also encourages comments on any aspect of competition policy and updating the Communications Act. Comments are due by January 23, 2015. 

Regulatory Activity

FCC Releases Order Further Modernizing E-Rate Program

On December 19, 2014, the FCC released a Second Report and Order and Order on Reconsideration (Order) making more funding available for schools and libraries to purchase broadband connectivity capable of delivering gigabit service. The Order builds on the FCC’s July 2014 Order and Further Notice of Proposed Rulemaking, which made funds available for Wi-Fi connectivity by phasing out or ending support for legacy services such as paging and phone service.  While schools and libraries have benefitted from the FCC’s prior E-Rate orders, there is still a significant connectivity gap with over 40 million students in schools lacking broadband connections capable of supporting modern digital learning.  Recognizing that the gap will only widen as digital learning applications increase bandwidth requirements, the FCC’s Order is a further attempt to close the connectivity gap and to benefit students.  The Order raises the spending cap for the E-Rate program from the current $2.4 billion to $3.9 billion, representing the first reset of the cap since it was initially set at $2.25 billion in 1997.

FCC Releases NPRM to Modernize Definition of MVPD

On December 19, 2014, the FCC released a Notice of Proposed Rulemaking (NPRM) seeking comment on how to modernize the definition of multichannel video programming distributor (MVPD). Because video services are no longer tied to a particular distribution technology, the FCC proposes to interpret MVPD in a technology-neutral way to include certain providers that make multiple linear streams of video programming available for purchase regardless of the technology used to distribute the programming. In doing so, the FCC intends to balance consumer interests with the ability of new, web-based video programming services to compete with established providers to ensure that the FCC’s regulations can accommodate the current technology transition occurring in the video distribution industry.

FCC Releases 17th Annual Mobile Wireless Competition Report

On December 18, 2014, the FCC released the 17th Annual Mobile Wireless Competition Report. Like the FCC’s previous three reports, the Report provided an analysis of the mobile wireless industry’s competitive metrics and trends, but did not reach an overall conclusion regarding whether the market is “effectively competitive.” The Report determined that market concentration in the mobile wireless market was “highly concentrated” according to a “widely-accepted” measure based on market share, but noted that an analysis of other factors may find that a market with high concentration levels is nevertheless competitive.

FCC Grants T-Mobile Petition to Provide Guidance on Data Roaming Rate Agreements

On December 18, 2014, the FCC’s Wireless Telecommunications Bureau (WTB) granted T-Mobile’s petition for declaratory ruling (“Petition”) requesting guidance on how to evaluate data roaming agreements between wireless providers. Under the FCC’s rules, facilities-based providers are obligated to offer data roaming arrangements under “commercially reasonable terms and conditions.”  In its Petition, T-Mobile asserted that “must have” roaming partners have exploited uncertainties in the commercial reasonableness standard to deny roaming requests. The WTB granted T-Mobile’s request that the FCC consider four “benchmarks” relevant to assessing the commercial reasonableness of provider to provider roaming rates:  (i) retail rates; (ii) international roaming rates; (iii) MVNO/resale rates; and (iv) roaming rates charged by other providers.  The WTB also agreed with T-Mobile that: (i) previously negotiated rates, and (ii) the extent of a carriers’ build out in a particular area would not necessarily be determinative as to future rates. Following the WTB’s grant of T-Mobile’s Petition, Commissioners Pai and O’Rielly released a joint statement taking issue with the Chairman’s Office’s directive to the WTB to rule on T-Mobile’s Petition without requiring – as was requested by both objecting Commissioners – a full Commission vote on the item.

New Video Captioning Standards to Take Effect March 16, 2015

The Office of Management and Budget (OMB) has approved the information collection requirements for the FCC’s new video captioning quality standards and rules intended to improve the accessibility of television programming for the deaf and hard of hearing. The rules were adopted by the FCC in February 2014 and will take full effect on March 16, 2015. Significant amongst the rules are newly established best practices in captioning for video programming distributors and standards for accuracy, synchronicity, program completeness, and placement of captions.

FCC Modifies Equipment Authorization Rules

The FCC amended its radiofrequency (RF) equipment authorization rules in a Report and Order released on December 30, 2014. The Report and Order delegates exclusive authority for the acceptance and processing of all applications for equipment Certification to Telecommunications Certification Bodies (“TCBs”), codifies the current “permit-but-ask” procedure for TCBs to certify new technology in coordination with the FCC’s Office of Engineering and Technology (“OET”), and codifies the procedure that allows TCBs to request post-market surveillance samples for testing directly from the grantee. The Order also grants delegated authority to the Chief of the OET to engage in limited rulemaking to modify FCC rules to reference updated equipment measurement standards in cases in which the modification would not raise major compliance issues.