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 Final Agenda for its next Open Meeting to be held May 9, 2013, at 10:30 am Eastern. It contains the two items previously noticed: a Notice of Proposed Rulemaking on allocating spectrum in the 14.0-14.5 GHz band to increase broadband access on airline flights; and a Notice of Proposed Rulemaking and Notice of Inquiry on Commercial Space Operations. The Commission has added a third item: a Report and Order with the first set final rules for text-to-911 service. To read the Final Agenda, click here.

The Mobile Market

  • On May 1, 2013, the FCC released a Notice of Proposed Rulemaking on measures it may adopt to prevent the use of cellphones by incarcerated persons. In the NPRM, the FCC states that “[p]risoners’ use of contraband wireless devices to engage in criminal activity is a serious threat to the safety of prison employees, other prisoners, and the general public.” The proposed rules would make it easier for correctional facilities to enter into leases or spectrum management agreements, allowing them to control which wireless devices were able to access the network. In addition, the proposed rules would “require wireless providers to terminate service, if technically feasible, to a contraband wireless device if an authorized correctional facility official notifies the wireless provider of the presence of the contraband wireless device”. The Commission also invites comment on “other technological approaches for addressing the problem of contraband wireless device usage in correctional facilities.” Comments on the NPRM are due 30 days after Federal Register publication, and Reply Comments are due 45 days after publication. The NPRM is available here. GN Docket No. 13-111; ET Docket No. 08-73; WT Docket No. 10-4.

Federal Trade Commission (FTC) and Privacy Regulation

  • The FTC has issued an updated set of frequently asked questions regarding the new Children’s Online Privacy Protection Act (COPPA) Rule, “Complying With COPPA: Frequently Asked Questions". According to the FTC’s press release, the FAQs are “designed to help website operators, mobile application developers, plug-ins and advertising networks operating on child-directed websites and online services prepare for upcoming changes to the” COPPA Rule. The new COPPA Rule will go into effect on July 1, 2013. 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.” More information regarding the one-day forum is available here.
  • The FTC has announced a public workshop to be held on November 21, 2013, in Washington, DC to address the consumer privacy and security issues raised by the growing connectivity of consumer devices such as smart phones, cars, appliances, and medical devices, also commonly referred to as “The Internet of Things”. In advance of the workshop, the FTC is inviting comments on these issues and will accept submissions through June 1, 2013. More information regarding the “Internet of Things” workshop and comments is available here.

New Markets: Smart Grid and E-Health

  • The FCC Wireline Competition Bureau is seeking comment on a petition filed by USTelecom for reconsideration and clarification of the FCC’s Healthcare Connect Fund (HCF) Order The petition asks the FCC to reconsider its decisions to permit health care providers participating in the HCF to install and resell excess capacity, and to receive support for dark fiber. USTelecom also asks the Commission to clarify several parts of the order. Comments are due May 9, 2013, and Reply Comments are due May 20, 2013. To read the Public Notice, click here. WC Docket No. 02-60.
  • The U.S. Department of Energy (DOE) has released a report on the economic gains achieved through smart grid stimulus funding. The report, titled “Economic Impact of Recovery Act Investments in the Smart Grid”, estimates that the roughly $2.9 billion in stimulus funds spent to date have yielded close to $7 billion in economic benefits and contributed to the creation of nearly 50,000 high-quality jobs that provide higher than average pay. The report also notes that the funding has had a particularly strong impact on the computer systems design industry, technical and scientific consulting services, and the electrical/wireless equipment manufacturing sectors. It is available here.

Developments in Intercarrier Compensation

  • On April 25, 2013, AT&T Corp. filed suit against Brightlink Communications, LLC in the U.S. District Court for the Northern District of Georgia, alleging that Brightlink owes it more than $467,000 in unpaid charges for VoIP services provided to Brightlink for resale. AT&T alleges that it billed Brightlink more than $1.2 million from January 2011 until July 2012, but that Brightlink made no payments until October 2011. AT&T further alleges that when it and Brightlink negotiated an installment plan to pay past due charges, Brightlink failed to honor this agreement. AT&T has disconnected its service to Brightlink and seeks the remaining amounts due, plus interest and attorneys’ fees. AT&T Corp. v. Brightlink Communications LLC, CIV No. 1:13-cv-01374-WSD (N.D. Ga.).

Compliance Notes

  • 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)

Broadband News

  • The Federal Register has published the FCC’s Notice of Proposed Rulemaking in PS Docket No. 12-94 regarding the use of broadband in the public safety network. Initial Comments are due May 24, 2013, and Reply Comments are due June 10, 2013. To read the Public Notice announcing these dates, click here. To read the NPRM, click here.

In the Courts

  • On May 1, 2013, the U.S. Court of Appeals for the Second Circuit affirmed a trial court’s 2011 ruling that AT&T Connecticut may charge only TELRIC (Total Element Long-Run Incremental Cost) rates for transit services provided to wireless and competitive wireline carriers. Various Competitive LECs (including Comcast and Cox) and wireless carriers (including MetroPCS and Sprint) challenged AT&T’s attempt to charge them higher, negotiated rates for its transiting services. The court of appeals agreed with the trial court that Congress requires Incumbent LECs like AT&T to charge the lower rate for transit services: “It would be inconsistent with the stated purpose of the [1996 Telecom Act] to allow AT&T to charge higher negotiated rates for this service because this would impose additional costs and competitive disadvantages upon new entrants. Such an imposition would allow AT&T to further exploit its status as a former monopolist.” The appeals court also rejected AT&T’s argument that the FCC had preempted this issue by examining but not deciding it: “we have little difficulty concluding that with regard to transit service Congress did not intend to preempt state regulation, the text of the TCA does not support preemption, and the FCC’s indecision simply reflects its current preference for continued experimentation by state commissions.” S. New England Tel. Co. v. Comcast Phone of Conn., Inc., No. 11-2332-cv (2d Cir. May 1, 2013).

Legislative Outlook

  • The text of H.R. 1685, the “Broadband Adoption Act of 2013”, introduced by Rep. Doris Matsui, D-Cal, is now available. It would require the FCC to adopt rules within 270 days that entitle low-income consumers to Lifeline assistance for purchasing broadband service. To read the bill in full, click here.
  • The Senate Judiciary Subcommittee on Crime and Drugs will hold a hearing titled “Cyber Threats: Law Enforcement and Private Sector Responses” on May 8, 2013, at 9:00 am Eastern in 226 Dirksen. It will be available via live webcast here.