United States: Communications Law Bulletin -- April 2006 (Part Two)

FCC Adopts New "Junk Fax" Rules as Collections Industry Requests Clarification of Scope of Telemarketing Requirements

On April 6, 2006, the FCC released its Report and Order and Third Order on Reconsideration ("Order") implementing the Junk Fax Prevention Act of 2005 ("JFPA").

The JFPA was a critical piece of legislation for companies that engage in fax advertising. Before the JFPA was enacted, the FCC had determined that advertisers may no longer send fax advertisers to recipients with whom the sender had an established business relationship ("EBR") unless the sender had first obtained the recipient’s prior, written permission to do so. As a result, many fax advertisers were faxed with the costly, cumbersome prospect of obtaining written permission to continue sending faxes to their vendors and business customers. The JFPA brought this process to a halt by directing the Commission to adopt new rules that would permit commercial faxes to be sent to recipients with whom the sender has an EBR, so long as each such fax defines a mechanism by which the recipient can "opt out" of receiving faxes from that sender in the future.

Among other provisions, the Order announces the following rules and decisions:

• For purposes of the fax advertising rules, an EBR will be defined as "a prior or existing relationship formed by a voluntary two‑way communication between a person or entity and a business or residential subscriber with or without an exchange of consideration, on the basis of an inquiry, application, purchase or transaction by the business or residential subscriber regarding products or services offered by such person or entity, which relationship has not been previously terminated by either party."

• The sender of a fax ad is responsible for demonstrating the existence of an EBR, although senders are not required to keep any specific records for this purpose.

• Even where the sender and recipient have an EBR, the sender must have obtained the fax number directly from the recipient, or the recipient must have voluntarily made the fax number available in a directory, advertisement, or Internet site that is accessible to the public. An exception to this requirement applies if the EBR was formed prior to July 9, 2005.

• No time limit is placed on EBRs, but the FCC will revisit the time limit question, based on any history of complaints to the Commission, within one year of the Order’s effective date.

• The first page of each fax ad must include a notice stating that the recipient is entitled to request that the sender not send any future unsolicited ads. The notice must include a direct contact telephone number and a fax number for the recipient to transmit such an "opt out" request, and must provide at least one cost‑free mechanism for transmitting the request.

• The opt-out notice must be "clear and conspicuous," but no rules are imposed concerning font type, size and wording. However, the notice must be distinguishable from the advertising material.

• Senders must honor opt out requests within 30 days.

• An unsolicited advertisement will be defined as "any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without the person’s prior express invitation or permission, in writing or otherwise." The final four words of the definition are an addition to the Commission’s previous definition, as required by the Junk Fax Act.

• Prior express invitation or permission may be given by oral or written means, including email, fax and Internet, but always must be given before the fax is sent.

In another electronic marketing development, the FCC put out on Public Notice a petition for expedited declaratory ruling filed by ACA International, a group that represents credit and collection companies. ACA’s petition asks the Commission to rule that collections calls are not covered by the Commission’s prohibition against use of autodialers to call numbers assigned to cellular telephone services. The petition points out that debtors frequently provide mobile numbers as points of contact in credit applications, and argues that Congress did not intend to prohibit collections calls to the mobile numbers of those customers.

Comments on the ACA petition are due May 11, 2006, and reply comments must be filed on or before May 22, 2006.

Finally, the General Accountability Office ("GAO") released a report on April 5, 2006, issued a critical report on the state of FCC enforcement of its fax advertising regulations. According to the GAO, enforcement is hampered by inefficient data management and lack of coordination between the FCC’s Consumer & Governmental Affairs Bureau and the Enforcement Bureau.

Late on April 25, 2006, the House of Representatives unanimously passed a bill aimed at data brokers that obtain consumers’ telephone records by means of "pretexting." HR 4709 authorizes prison terms of up to ten years, and fines of up to $250,000 for individuals and $500,000 for organizations. The bill now will go to the Senate.

In the meantime, the House Commerce Committee issued subpoenas to 12 data brokers that had refused to respond to requests for voluntary disclosure of information, and the FCC announced its intention to fine Cbeyond Communications $100,000 for failure to comply with the Commission’s customer proprietary network information ("CPNI") regulations.

On April 19, the FCC issued a forfeiture order requiring Globcom, Inc., a long distance resale carrier, to pay a penalty of $715,031 for its willful and repeated failures to contribute to the Universal Service Fund ("USF") and Telecommunications Relay Service ("TRS") fund and to file complete and accurate interstate and international revenue information. This proceeding was initiated in 2003 by a Notice of Apparent Liability and Order ("NAL") issued against Globcom proposing a forfeiture of $806,861 for unpaid USF and TRS contributions for 2001-03.

In its response to the NAL, Globcom asserted that: its revenue filings actually overstated its revenue; it should be given credit under the limited international revenue exception; the forfeiture calculation in the NAL differed from the method used in earlier similar cases; and it could not afford to pay the forfeiture amount. Based on Globcom’s revised revenue reports for 2002, the Universal Service Administrative Company ("USAC") reduced Globcom’s USF contribution debt, reflecting the application of the expanded international exemption. Nevertheless, because Globcom failed to submit any timely revenue reports since the NAL and paid nothing to either the USF or TRS funds since early 2003, Globcom’s unpaid USF contribution balance increased to almost $1,120,000.

The FCC rejected Globcom’s argument that, because the forfeiture was calculated in a different manner from previous similar cases, the higher resulting amount violates the Administrative Procedures Act. The forfeiture amount is less than the maximum amount authorized by Section 503 of the Communications Act, and the FCC had warned in previous cases that it would impose greater USF contribution-related forfeitures in the future based on more stringent methodologies, if necessary to deter violations. The FCC noted that Globcom clearly had not been deterred, since it "has yet to pay even the money it admits to owing." Moreover, delinquent carriers may obtain a competitive advantage over carriers complying with their contribution obligations. The FCC also rejected Globcom’s claim that, because of its low margins on its resale business, it is unable to pay the forfeiture. The FCC noted that it has repeatedly found that gross revenues are the best measure of a carrier’s ability to pay a forfeiture and that Globcom’s gross revenues are much greater than the forfeiture amount.

This forfeiture order continues and escalates the FCC’s crack-down on USF contribution and revenue reporting violations (reported in the July-August 2005 issue of the Bulletin). Particularly in cases of repeated violations, the FCC can be expected to make good on its previous threats to impose greater penalties, using more stringent penalty calculation methodologies, for nonpayment of USF and other contribution obligations.

The FCC at its April 12 open meeting adopted a public notice setting forth key details regarding the procedures for Auction No. 66 in which it will auction more than 90 MHz of Advanced Wireless Service ("AWS") spectrum. Pursuant to the public notice, the auction remains scheduled to begin on June 29, 2006. Although the FCC maintained many of the same auction procedures utilized in prior auctions, it also modified certain significant aspects, including the potential that the identities of bidders will not be publicly disclosed throughout the auction.

The FCC previously had proposed to implement blind bidding for the first time in a spectrum auction in order to block collusion and other anti-competitive behavior. However, both small and larger carriers objected to implementing such a dramatic and untested change in procedures to an auction that has been hailed as one of the largest and most important in FCC history. Industry members have argued that limiting disclosure of bidding data would, in fact, provide certain bidders with a competitive advantage while placing others at a disadvantage, potentially leading to some carriers to decide to not participate in the auction at all.

The FCC ultimately concluded that it would adopt key aspects of a compromise bidding plan proposed by T-Mobile USA, Inc. Specifically, the FCC will examine the "threshold eligibility ratio" of the auction prior to the start of the auction to determine whether the auction would be sufficiently competitive to limit the likelihood of anti-competitive behavior. If the ratio is three or greater — i.e., the amount of upfront payments for the auction as a whole equals an average of three bidders per license — the FCC will conduct the AWS auction as it has in the past by disclosing bidder data after each bidding round. (T-Mobile had proposed a threshold eligibility ratio of two.) If the threshold is not met, however, the FCC will withhold the license selections each bidder chose on their short form applications and the bidder identities and other bidding information during the auction. The FCC would reveal the gross amount of the bids after each bidding round.

Whether bidder information will be disclosed will not be known until after the short form applications are filed and upfront payments are made. Although the FCC has not calculated the threshold eligibility ratio of prior auctions, one market participant has estimated that based on its own calculations Auction No. 5 (PCS C Block) had an eligibility ratio of 6.72, Auction No 58 (mainly PCS C and F Blocks) had an eligibility ratio of 2.94, and Auction No. 4 (PCS A and B Blocks) had an eligibility ratio of 1.93.

The FCC also decided that the AWS spectrum would be auctioned in a single sale using a simultaneous multiple-round format, which is the traditional auction format used in prior auctions. The FCC previously had sought comment on whether the spectrum should be auctioned using package bidding. In addition, the FCC reduced minimum opening bids and upfront payments for rural licenses. Further, the FCC adopted a minimum reserve price for the entire auction such that the total winning bids, net of any bidding credits, must exceed $2.059 billion. If this reserve price is not met, the auction will be cancelled.

FCC Commissioners Copps and Adelstein issued concurring votes for the AWS auction procedures. Commissioner Copps stated that he did not have sufficient time to "determine with confidence that we can successfully change so many long-standing auction procedures." Commissioner Adelstein remarked that it "is unclear to me what specific harms this [blind bidding] proposal is intended to address" and that "the full Commission did not have the opportunity to shape the original proposal or add questions that may have helped inform the decision-making process."

The FCC also has released an order and further notice of proposed rulemaking that modifies the FCC’s rules regarding designated entities ("DEs") (see separate article). The Democratic Commissioners have long been urging a rulemaking to reform the DE rules to limit the ability of national wireless carriers to partner with small businesses. The rules adopted in the new order apply to the AWS auction.

The FCC and the National Telecommunications and Information Administration ("NTIA") also have released joint coordination procedures for relocating government users from the AWS band. Use of the AWS licenses will be conditioned on the commercial licensees coordinating frequency usage with known co-channel and adjacent channel incumbent federal users. Under the joint procedures, both commercial and government licensees must coordinate fully and make reasonable efforts to resolve and technical problems. Prior to operations, AWS licensees must contact the appropriate government agency to obtain information necessary to perform an interference analysis. If the agency does not respond within 30 days, the AWS licensee may contact NTIA for assistance. The AWS licensee then must send its interference analysis to the agency for review. If the agency does not raise any objections within 60 days, the AWS licensee may commence operations.

FCC Revises Rules for Transitioning to New Brs/Ebs Band

On April 12, the FCC adopted an order revising several key elements of the plan for transitioning to the new band for broadband radio services ("BRS") and educational broadband services ("EBS"). The BRS/EBS industry supported many of these changes. For example, the FCC revised its rules to permit licensees within "basic trading areas," rather than larger "major economic areas," to transition to the new BRS/EBS band. The FCC also allowed BRS and EBS licensees the option to self-transition to the new band. Additionally, the FCC allowed EBS licensees to lease their capacity for terms of up to 30 years, but required that leases with terms of 15 years or longer must allow EBS licensees the right to revisit certain requirements of the leases every five years after 15 years. Because the full text of the order has not been released yet, many of the details of the FCC order remains unclear.

Legislative Developments

In late March, House Energy and Commerce Committee Chairman Barton (R-Tex.) released a draft telecommunications bill, despite the lack of support from key Democratic members of the committee. The draft bill would allow cable operators and others to bypass local franchising requirements and obtain national franchising authority from the FCC. Franchise fees would be set at five percent of an operator’s gross revenue. The draft bill also would prohibit the FCC from adopting Net neutrality rules, but would allow the FCC to enforce Net neutrality principles in complaint proceedings. It would grant interconnection rights to VoIP providers, but require them to provide E911 capability. Additionally, the draft bill would remove state bans against the provision of telecommunications, cable, or broadband services by municipalities.

Telephone companies, cable operators, and other network operators have responded fairly favorably to the draft bill, while consumer groups and Internet content providers criticized major portions of the bill, such as the Net neutrality and national franchise provisions. Meanwhile, the Senate Commerce Committee has been continuing work on its version of a comprehensive telecommunications bill, and it is uncertain how different the Senate and House bills will be.

Reform of the universal service program, which has been a focus of the FCC and Congress for some time, recently received additional attention with new legislation proposed in the House and FCC Chairman Kevin Martin reviving an old idea of a "reverse auction" allocation method for high-cost support. Both the new bill and Martin’s proposal would significantly change the universal service program. In addition, those defrauding the universal service schools and libraries program, also known as the E-rate program, continue to be prosecuted.

Representatives Lee Terry (R., Neb.) and Rick Boucher (D., Va.) introduced the Universal Service Reform Act of 2006 ("USF Act"), which is intended to reflect a year of consultation with industry and other interests. The USF Act would broaden the base of contributors to the universal service fund ("USF") to include any service provider that uses telephone numbers, IP addresses, or their functional equivalents to provide voice services. This would include voice over Internet protocol ("VoIP") services, regardless of whether the services are provided over DSL, power lines, or cable modems. The USF Act allows the FCC to decide the contribution methodology for the USF. If a revenue-based method is chosen, the FCC is authorized to base a carrier’s contribution on intrastate, interstate and international revenues.

In addition, if adopted as introduced, the USF Act would place a cap on the fund for high-cost support. USF support for schools, libraries, rural health care facilities, and the Lifeline and Link-up programs would not be subject to the cap. The USF Act also would limit the number of eligible telecommunications carriers ("ETCs") by specifying specific criteria that must be met to receive USF support, including providing universal service, demonstrating the ability to remain functional in emergencies, and satisfy certain customer protection and quality of service standards. Support to ETCs would be based on actual costs of providing service. The USF Act, however, prohibits the FCC from adopting a primary-line restriction.

The new also bill proposes to provide USF support for providing broadband services, but imposes a five-year build out requirement on support recipients. Further, it is supposed to address "phantom traffic" concerns by requiring carriers to identify all traffic originating on their networks and requiring intermediate carriers to pass through appropriate call data. In addition, the USF Act permanently exempts the USF from the Anti-Deficiency Act.

Chairman Martin at a public speaking event proposed using a "reverse auction" for high-cost universal service support to battle the ever-increasing USF. Under the proposal universal service support would be allocated for the network of the lowest bidder in a particular geographic region rather than multiple operators in one region. In exchange for receiving USF monies for five years, a carrier would be designated the carrier of last resort. According to Chairman Martin, subsidizing multiple wireline and wireless carriers "might be a good thing" if there is "a limitless amount of money." However, paying wireless carriers high-cost support when customers also keep their landline phones contributes to the growth of the USF, which must be curbed.

Opponents to the reverse auction concept argue that it would discourage investment and network upgrades, including investments in VoIP and other new services. According to opponents, although the auction process may reduce pressure on the USF, it does not take into consideration real world characteristics of building and maintaining high-cost, capital-intensive networks.

In related events, the government continues to prosecute those that attempt to defraud the E-rate program. Networking company NextiraOne LLC, a subsidiary of Platinum Equity LLC, has been charged with defrauding the E-rate program and the Oglala Nation Educational Coalition member schools, which are located on the Pine Ridge Reservation in South Dakota. NextiraOne is charged with inflating equipment prices, submitting fraudulent invoices and failing to deliver and install certain equipment that was paid for through the E-rate program. NextiraOne has entered into a plea agreement under which it will pay a $1.9 million criminal fine and forfeit more than $2.6 million in reimbursement for uncompensated work previously performed at other school districts. A federal grand jury in South Carolina also has returned a 12-count indictment against the former technology director of Bamberg County School District One in Bamberg, South Carolina for submitting fraudulent E-rate funding applications and fraudulently obtaining more than $468,000 in E-rate support.

States continue their efforts to deregulate telecommunications services, although the rapid pace of the last few months seems to be slowing down. This may signal that this effort has run its course and that future regulatory initiatives will be in other areas, such as video franchising. In the meantime, a number of public utility commissions and state legislatures continue to consider how to adapt regulations to the increasingly competitive markets for telecommunications services in their jurisdictions.

On April 11, the New York Public Service Commission ("NYPSC") adopted a policy that grants Verizon and Frontier virtually unlimited pricing flexibility for most retail telecommunications services. The order is part of the NYPSC’s proceeding to examine issues related to intermodal competition, initiated in June of last year. After hearing from interested parties and reviewing a staff report released last fall, the NYPSC concluded that wireless, cable, and VoIP services provide sufficient intermodal competition to justify deregulating Verizon’s and Frontier’s non-basic retail services. The order points to significant access line loss for both companies in recent years and the staff estimate that 90% of New Yorkers have at least two intermodal alternatives to the incumbents’ wireline networks. These carriers must continue to offer a basic service subject to a regulated price cap that may be increased in accordance with certain conditions that will allow basic services to better reflect cost. Wholesale services will continue to be regulated. Independent incumbent carriers also are allowed some pricing flexibility but, unlike Verizon and Frontier, the incumbents must offset any price increases by decreasing access charges, unless they can cost-justify retaining the increased revenues. In addition, the NYPSC will commence a proceeding to consider modifying service quality and consumer protection regulations and a separate proceeding to evaluate pole attachment rates.

The Governor of Kansas just signed a deregulation bill in that state. The Kansas law, passed in the final days of the 2006 legislative session, removes from the Corporation Commission the authority to set rates in certain telephone exchange areas. Prices for bundled and stand-alone services will be completely deregulated in exchanges with more than 75,000 local access lines, only basic exchange rates for customers purchasing 5 or fewer lines would continue to be regulated. The law applies to carriers currently subject to price regulation. In exchanges with less than 75,000 access lines, a carrier can request price deregulation of business services if the carrier can demonstrate that two or more non-affiliated carriers, at least one of which is facilities-based, provide services to business customers.

The Governor of Kentucky just signed the deregulation bill in that state as well. The law will create "basic local exchange" and "non-basic" classes of service and restricts the Public Service Commission’s authority to certain consumer issues and to FCC-delegated authority over wholesale transactions. Basic local exchange rates would be frozen for five years and subject to ongoing PSC oversight afterwards.

The past month also has seen state activity overseeing the contracts between telecommunications carriers and their customers. Perhaps as the next phase in the evolution of telecommunications deregulation, the governor of West Virginia signed a bill intended to "improve competition among telephone public utilities providing landline services." The bill, now law, prohibits telephone public utilities from using automatic renewal provisions in their landline customer services agreements; requires notice of the end of the service agreement; provides that after initial term of landline customer services agreement the term shall be on a month-to-month basis unless customer signs new landline customer services agreement; and limits termination fees charged by telephone public utilities for landline service and providing method of computing termination fee.

In Michigan, a federal district court (Eastern District) has denied SBC’s (now AT&T’s) motion for summary judgment to dismiss a complaint filed by a customer, Diamond Computer System, who claimed that SBC had failed to honor promises made by the sales representative as to the installation date of the services and other commitments that were not included in the written contract. SBC had argued that the contract expressly disclaimed any liability for promises not made in writing as part of the contract. The court disagreed, concluding that the plaintiff’s claim of promissory fraud could withstand summary judgment despite the "merger" and "no-reliance clauses" in the contract. Important to the court’s analysis was the fact that, at the time the contract was entered, SBC did not have in place the facilities needed to provide the contract services and would not have them by the installation date promised by the sales representative.

Foreign companies seeking to acquire U.S. telecommunications assets need to be increasingly aware of the Exon-Florio approval process in addition to any necessary FCC approvals. Specifically, the role of the Committee on Foreign Investment in the United States ("CFIUS") and its review of foreign investment in the United States received considerable media scrutiny in connection with the proposed acquisition by Dubai Ports World ("DP World") of P&O Navigation, including operations at six U.S. ports. Following CFIUS approval of the transaction, congressional action threatening to block the transaction resulted in DP World announcing that it would sell the U.S. operations of P&O Navigation to a U.S. entity.

The CFIUS approval of the DP World transaction has raised congressional concerns over the secretive CFIUS foreign investment review process and its effectiveness in protecting U.S. national security priorities. Lawmakers in both the House of Representatives and in the Senate have drafted various legislative proposals aimed at revising the CFIUS review and approval process. At last count, there were 12 bills in the Senate and 11 in the House. The general theme of the various legislative proposals is towards greater transparency in the national security review process, congressional notification of transactions, and in certain cases express limitations on foreign ownership of certain U.S. assets, including (under many of the bills) telecommunications infrastructure.

On March 30, 2006, the Senate Banking Committee unanimously approved the "Foreign Investment and National Security Act of 2006," which was introduced by Senator Shelby (R‑AL). This legislation would substantially reform the CFIUS process by, among other things, expanding the initial 30-day CFIUS review by an additional 30 days if there are national security concerns with the transaction, and mandating an extended 45-day investigation of transactions involving critical infrastructure. In addition, the bill would create a secret "national security" ranking system of countries. Because the Senate Banking Committee has already considered and approved this bill, it is likely to be the CFIUS reform legislation considered by the full Senate.

In the House, Representative Hunter (R-CA), Chairman of the House Armed Services Committee, introduced legislation entitled the "National Defense Critical Infrastructure Protection Act of 2006." The most noteworthy provision of this legislation prohibits an entity from owning, or being authorized to manage or operate, any system or asset that is included on a (to-be-determined) national defense critical infrastructure list, unless the entity meets specified national security management requirements. These requirements include the entity being majority owned by U.S. citizens and having a majority of its board members approved by the Department of Defense.

It is anticipated that hearings on the House bills will be scheduled in May. There has been considerable concern among the domestic and international business community that restrictions on foreign ownership of U.S. assets could have a chilling effect on foreign investment in the United States. Accordingly, the business community has engaged in lobbying efforts to limit the possible adverse impact of any CFIUS reform legislation. While it is too early to determine the final form of any new CFIUS legislation, it is widely expected that such legislation will be passed prior to the November 2006 mid-term elections.

The FCC recently issued an order on TelCove’s petition for declaratory ruling seeking permission for foreign ownership in a wireless licensee above the 25% statutory benchmark. This order, which involved complex calculations involving several investment funds, was interesting in several respects:

• First, the licensee was unable to obtain foreign ownership information from several small investment funds. As a result, the FCC treated these unidentified owners as non-WTO owners for purposes of the foreign ownership calculation.

• Second, the licensee was unable to obtain specific ownership information from a few large presumably US investors, who declined to provide detailed information in light of their relatively small investments. Although the FCC grudgingly treated this obviously US ownership as US, it cautioned that any additional investment by these investors would be treated as non-WTO foreign investment unless the investors provided the required information.

• Third, the FCC seemed to tighten up considerably in its application of the "home market" test. This multi-factored test, which determines the nationality of a particular foreign investment, has traditionally been applied on a "balance of the factors" basis. In this order, however, the FCC appears to have treated (in some cases) an investor with even a single foreign indicator as foreign investment.

• Fourth, the FCC emphasized that nunc pro tunc approvals (i.e., approvals after the violation has already occurred) will be granted very sparingly — typically only when an application has been dismissed in error or when "exceptional" public interest factors are present. The FCC emphasized that bankruptcy did not constitute such an exceptional factor.

In short, the FCC continues to wrestle with increasingly complex foreign ownership calculations and seems to be applying an increasingly strict "home market" test for assessing foreign ownership. As a result, wireless licensees/applicants need to be vigilant with respect to the current guidance on foreign ownership calculations and need to regularly recalculate their foreign ownership to ensure that they remain in compliance.

The FCC issued a $750,000 Notice of Apparent Liability ("NAL") against Dobson Communications, a Tier II wireless carrier, for multiple violations of the FCC’s Enhanced 911 ("E911") rules. Specifically, the NAL penalizes Dobson, which uses a network-based (rather than handset-based) E911 solution, for 50 alleged violations of the FCC’s rules by not timely implementing its Phase I and Phase II E911 obligations in response from service requests by public safety answering points ("PSAPs").

The FCC concluded that Dobson’s violations were willful, repeated and particularly egregious given that the E911 rules promote the safeguarding of life and property. The FCC stated that multiple PSAP requests had been pending for two to three years. Nine of the alleged violations are for failing to implement Phase I requirements, which have been in effect for more than seven years. According to the FCC:

Dobson has not shown that it exercised the level of diligence expected of carriers in addressing the deployment of E911 services to warrant any mitigation. Rather, the record indicates that Dobson may not have dedicated sufficient resources and attention to E911 implementation at a time when it was actively expanding its wireless market holdings and converting its network from TDMA to GSM technology. Moreover, it appears that many of the violations stemmed, in part, from a lack of corporate oversight of the Dobson employee charged with the important function of managing Dobson’s deployment of E911.

The FCC concludes that a $750,000 total fine is warranted in Dobson’s case. The FCC appears to focus on Dobson’s size and financial resources and the desired deterrent effect of the penalty, but otherwise does not explain the basis for the $750,000 amount. There is no base penalty for E911 violations under the FCC’s rule, although the FCC can assess a forfeiture of up to $130,000 for each violation, or for each day of a continuing violation up to a maximum of $1.325 million.

After months of waiting, it also appears that the FCC may be ready to act against Tier I wireless carriers that missed a December 31, 2005 E911 deadline. Specifically, carriers deploying a handset E911 solution were required that 95 percent of their handsets be location capable. Waivers of the December 2005 deadline have been filed for large and small carriers alike.

The ultimate outcome likely will be based on each carrier’s particular situation and likely will be a combination of waivers and forfeitures. Multiple carriers reportedly have been contacted by the FCC’s Enforcement Bureau already. Carriers’ handset penetration rates vary widely. For example, Verizon Wireless’ penetration rate reportedly hovers slightly below the 95 percent threshold and Sprint Nextel reportedly has an approximate 84 percent penetration rate. Multiple smaller and rural carriers also have lower penetration rates because subscribers are not purchasing new handsets and some are loath to give up old analog handsets because they may have better coverage in rural areas compared to digital handsets that are location capable.

Note: Although we try to ensure that the dates listed in the PDF document are accurate as of the day this edition goes to press, please be aware that these deadlines are subject to frequent change. If there is a proceeding in which you are particularly interested, we suggest that you confirm the applicable deadline. In addition, although we try to list deadlines and proceedings of general interest, the list below does not contain all proceedings in which you may be interested.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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