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 has released the Tentative Agenda for its next Open Meeting to be held April 18, 2013, at 10:30 am Eastern. It contains three items: 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 Tentative 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

  • The FCC has released a Report and Order and Further Notice of Proposed Rulemaking regarding whether it should modify its standards for exposure to radio frequencies (RF). 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.
  • Reply Comments on the remaining issues in the FCC’s Text-to-911 Further Notice of Proposed Rulemaking are due tomorrow, April 9, 2013. The Federal Register notice on the item is available here.

Federal Trade Commission (FTC) and Privacy Regulation

  • On April 2, 2013, the FTC announced the winners of its Robocall Challenge contest. Two submissions tied for the top spot and will share in the $50,000 prize for Best Overall Solution to block illegal robocalls. The challenge was “designed to help solve [the illegal robocall] problem by spurring innovation in the marketplace” and the FTC received approximately 800 eligible submissions. The two winning submissions each focus on intercepting and filtering out illegal prerecorded calls using technology to “blacklist” robocaller phone numbers and “whitelist” numbers associated with acceptable incoming calls. Both proposals also filter out unapproved robocallers using a CAPTCHA-style test to prevent illegal calls from ringing through to a user. The FTC made the disclaimer that, by selecting winners, it “isn’t endorsing any particular products or services. Before implementing any service involving personal information, companies should conduct a thorough privacy review and must consider and comply with the federal and state privacy, consumer protection, and other laws that may apply.” More information is available here.
  • 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.

Developments in Intercarrier Compensation

  • On April 1, 2013, AT&T Mississippi, AT&T Kentucky, AT&T Tennessee, and AT&T North Carolina filed a complaint against two competitive local exchange carriers (CLECs), BLC Management and Lifeconnex Telecom, in the US District Court for the Middle District of Florida, alleging that they failed to pay millions of dollars in intercarrier compensation charges that are due under the parties’ interconnection agreement (ICA). AT&T alleges that the CLECs “invented millions of dollars of specious promotions credit and discount requests” and then offset those amounts against charges for AT&T’s resold services. AT&T also alleges that both CLECs are owned by the same individual, and operated under similar business models. The Complaint also alleges that the state public service commissions of Mississippi, Kentucky, Tennessee, and Tennessee have revoked BLC’s authority to do business in those states. AT&T demands $38 million, plus interest, under the parties’ ICA. BellSouth Telecomms., LLC v. BLC Mgmt LLC, CIV No. 6-13-00529-PCF-DAB (M.D. Fla.).

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 1, 2013, the US Court of Appeals for the Second Circuit agreed that the Southern District of New York properly denied various broadcasters’ motion to enjoin Aereo’s transmission of their programming while the programs are still airing. Aereo allows its subscribers to watch or record broadcast television content over the Internet for a monthly fee. The broadcaster-plaintiffs – ABC, Disney, CBS, and NBC among them – sought to enjoin Aereo’s service on the ground that it infringes their exclusive right under the Copyright Act to publicly perform their works. Two of the three judges on the appellate panel agreed that the broadcasters were not likely to succeed on the merits of their claim, making injunctive relief inappropriate. The majority opinion relied heavily on the Second Circuit’s 2008 decision in Cartoon Networks v. Cablevision, where the court “concluded that Cablevision’s transmission of a recorded program to an individual subscriber was not a public performance. Each transmission of a program could be received by only one Cablevision customer, namely the customer who requested that the copy be created.” The panel also found it immaterial that Cablevision had paid the broadcasters for a license to transmit the programming. They reasoned that the determination of whether Aereo’s service was a “public performance” determined whether a license was needed, and not vice versa: “the question is whether Aereo’s transmissions are public performances of the Plaintiffs’ copyrighted works. If so, Aereo needs a license to make such public performances; if they are not public performances, it needs no such license.” The dissenting judge took issue with the majority’s reliance on how Aereo engineered its service: “[T]here is no technologically sound reason to use a multitude of tiny individual antennas rather than one central antenna; indeed, the system is a Rube Goldberg-like contrivance, over-engineered in an attempt to avoid the reach of the Copyright Act and to take advantage of a perceived loophole in the law.” Absent further appeal, the case will return to the trial court. WNET, Thirteen v. Aereo, Inc., Nos. 12-2786-cv, et al. (2d Cir. April 1, 2013).

Legislative Outlook

  • The Senate Communications Subcommittee will hold a hearing titled “State of Rural Communications” tomorrow, April 9, 2013, at 10:30 am Eastern in 253 Russell. Invited witnesses include Steven Davis, Executive Vice President of CenturyLink, and Patricia Jo Bowers, President and CEO of BOYCOM Cable. For more information, click here.
  • The Senate Antitrust Subcommittee will hold a hearing titled “Oversight of the Enforcement of the Antitrust Laws” on 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.