Welcome to the latest edition of Arent Fox’s This Week in Telecom, our weekly newsletter designed to keep you apprised of recent developments in telecommunications policy, legislation, and litigation.

Federal Communications Commission (FCC) Announcements

  • The FCC will hold a workshop on “bill shock” and “cramming” on April 17, 2013, from 9:00 am to 12:15 pm. It will be streamed at www.fcc.gov/live. To read the agenda, click here.
  • The FCC has released the Final Agenda for its next Open Meeting to be held April 18, 2013. Please note that the start time has changed to 10:00 am Eastern. The Agenda contains the same three items previously noticed: a Second Report and Order on streamlining foreign ownership policies for certain radio and aeronautical licenses; a Notice of Inquiry and Proposed Rulemaking on granting VoIP providers direct access to numbers; and a status report from the Consumer and Governmental Affairs Bureau on carrier compliance with the voluntary Code of Conduct to combat “bill shock” that becomes effective April 17, 2013. To read the Final Agenda, click here.
  • The FCC will hold a “Distracted Driving Technology Showcase” on April 19, 2013, from 10:00 am to 1:00 pm Eastern at its Headquarters. The FCC encourages attendees to pre-register by sending an email to DistractedDriving@fcc.gov. For more information, click here.

The Mobile Market

  • Most of the new rules adopted by the FCC for signal boosters will go into effect on May 13, 2013. The rules were adopted on February 20, 2013 in WT Docket No. 10-4. They create two classes of signal boosters and adopt regulatory requirements for each. Consumer Signal Boosters are designed to be used by individuals to improve their wireless coverage within a limited area such as a home or vehicle. They can be operated with the consent of the wireless network operator provided it is registered with the network operator and is an FCC certified model. Industrial Signal Boosters are designed to serve multiple users simultaneously and cover larger areas. These boosters require an FCC license or express licensee consent to operate, and must be appropriately labeled. Certain information collection requirements adopted by the Commission will not go into effect on May 13, because they require approval by the Office of Management and Budget. The Federal Register notice is available here.
  • The FCC has released a Report and Order and Further Notice of Proposed Rulemaking exposure to radio frequency (RF) emissions. The existing RF standards were adopted in 1996 and this marks the first time that the Commission will revisit them. There has been concern, including from some in the medical community, that current limitations may not adequately protect users of wireless devices, especially children and pregnant women, and that cellular towers may impact the health of nearby residents. Comments are due 90 days after Federal Register publication and replies are due 60 days thereafter. The full document is available here. ET Docket Nos. 13-84 and 03-137.
  • As part of its Learn Everything About Reverse-Auctions Now Program (LEARN), the FCC will host a workshop on May 3, 2013, to discuss technical aspects of the 600 MHz band plan for recovered broadcast spectrum. The workshop will be free and open to the public and will be held in Commission Headquarters. Additional details will be released closer to the event date. To read more, click here.

Federal Trade Commission (FTC) and Privacy Regulation

  • The FTC will host a “Cramming Roundtable” on May 8, 2013, to examine unauthorized third-party charges, also known as “cramming,” on mobile phone bills. The roundtable will bring together consumer advocates, industry representatives, and government regulators to explore various issues, including how mobile cramming occurs and how to protect consumers from this practice. The roundtable is free and open to the public and will be held at the FTC’s satellite building conference center, located at 601 New Jersey Avenue, NW, Washington, DC. More information is available here.
  • The FTC has announced that it will host a one-day public forum on June 4, 2013 addressing malware, viruses and similar threats facing users of smartphones, tablets and other mobile technologies. According to the press release, the one-day forum “will focus on the security of existing and developing mobile technologies and the roles various members of the mobile ecosystem can play in protecting consumers from these types of security threats.” Technology researchers and other interested parties are invited to recommend topics for discussion and to submit requests to serve as panelists at the forum, which topics and requests should be submitted electronically to mobilethreats@ftc.gov by March 28, 2013. More information regarding the one-day forum is available here.

New Markets: Smart Grid and E-Health

  • The National Institute of Standards and Technology (NIST) has issued two reports regarding the evolution of the nation’s power grid into a modern, “smart” energy distribution network. The reports are titled “Technology, Measurement, and Standards Challenges for the Smart Grid” and “Strategic R&D Opportunities for the Smart Grid”. They “identify the most important technical issues in the smart grid arena, and prioritize impediments and R&D areas that must be addressed for successful deployment of the smart grid.” The reports state that, with the rapid changes to the grid’s capacity as an information generating system, a host of challenges will arise for the research and development community, not the least of which are grid security and consumer privacy as outlined in the reports. Both reports are available here.

Developments in Intercarrier Compensation

  • On March 27, 2013, a Hearing Officer at the Tennessee Regulatory Authority (TRA) informed the agency that two areas of disagreement remain in the dispute between wireless and rural local exchange carriers over intercarrier compensation rates. The Hearing Officer reported that an arbitration panel needs to establish the reciprocal compensation rate that applies to traffic exchanged between the two classes of carriers before July 1, 2012, and to true up the interim rate, as needed. The carriers already have agreed that the FCC’s USF/ICC Transformation Order established a bill-and-keep regime effective July 1, 2012, so only the traffic exchanged between October 2004 and June 2012 remains in dispute. The rural LECs have stated that a rate of 1.5 cents per minute would be “fair and just.” The rural LECs have settled their disputes with Sprint, but the remaining wireless carriers urge the TRA to hold that they owe the rural LECs nothing for transporting and terminating the disputed traffic. The Hearing Officer ordered the parties to file initial briefs – which must include “final best offers” – on April 15, 2013, and reply briefs on April 29, 2013. The Report & Recommendation is available here. In re Petition for Arbitration of Cellco Partnership d/b/a Verizon Wireless, TRA Docket No. 03-00585.

Compliance Notes

  • Form 499-Q is due May 1, 2013, for all filers that are not considered de minimis for Universal Service filing purposes. This filing encompasses historical revenues from the first quarter of 2013 and projected revenues for the third quarter of 2013. A copy of the current FCC Form 499-Q can be found here.

Voice over Internet Protocol (VoIP) providers and Commercial Mobile Radio Service (CMRS) providers who rely on traffic studies to report interstate revenues on FCC Form 499-Q must submit these studies by May 1, 2013, to the Universal Service Administrative Company (USAC) and the Chief, Industry Analysis and Technology Division of the FCC.

  • Every non-dominant provider of detariffed interstate interexchange service must certify in writing by May 1, 2013, that it is in compliance with Section 254(g) of the Communications Act which requires that rates to subscribers in rural and other high-cost areas are no higher than rates charged to subscribers in urban areas. This filing is required by Section 64.1900 of the Commission’s rules.
  • The Universal Service contribution factor for the second quarter of 2013 is 15.5%. A copy of the Public Notice announcing the rate can be found here. (DA 13-422)

In the Courts

  • On April 5, 2013, the U.S. Court of Appeals for the Sixth Circuit affirmed the Western District of Kentucky’s ruling that TracFone Wireless owes approximately $5 million in state-mandated service fees to Kentucky’s CMRS Emergency Telecommunications Board. The trial court concluded – and the Sixth Circuit agreed – that TracFone owes the fees back to 2006. It had found that, “even though the CMRS Board initially failed to follow the procedures which this Court has ultimately required, that failure is not sufficient reason to conclude that TracFone can escape the broad statutory mandate.” Despite TracFone’s challenge that the statute is ambiguous, the court was “not persuaded” that the statute was so ambiguous to excuse TracFone from paying the fees. The court also rejected TracFone’s argument that the statute does not apply to prepaid providers, like TracFone: “the [statute’s] mandate that each CMRS provider collect fees is not diminished based on the mention of a billing method. While the billing language offers one possible method, there is no indication that the billing language has a limiting effect in applicability to CMRS providers.” Absent reversal by the Supreme Court, the liability stands. Kentucky Commercial Mobile Radio Serv. Emergency Telecomms. Bd. V. TracFone Wireless, Inc., Nos. 11-6215, et al. (6th Cir. 2013).

Legislative Outlook

  • The House Subcommittee on Courts, Intellectual Property and the Internet will hold a hearing titled “Abusive Patent Litigation: The Issues Impacting American Competitiveness and Job Creation at the International Trade Commission and Beyond” tomorrow, April 16, 2013, at 2:00 pm Eastern in 2141 Rayburn. To learn more, click here.
  • The Senate Antitrust Subcommittee will hold a hearing titled “Oversight of the Enforcement of the Antitrust Laws” tomorrow, April 16, 2013, at 2:30 pm Eastern in 226 Dirksen. Invited witnesses are William Baer, Assistant Attorney General, Antitrust Division of the Department of Justice, and Edith Ramirez, Chair of the FTC. More information is available here.