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Telecom/IT Policy Highlights


September 2003

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Contents:
Overview
Legislative Activities
Policy / Regulatory Activities
Other Activities and Items of Interest
Research/ Reports
OTP/GCATT Events
Newsletter Info
  • Overview

    As homeland security continues to be a priority issue in the U.S., the House Committee on Energy and Commerce moved on a bill [H.R. 2898] that would help improve coordination between public safety agencies and protect funds that are appropriated for states to deploy E-911 services. In a recent hearing on the legislation before its passage in committee, those representing industry wanted suppliers of services to be held more accountable for performance in implementing E-911 services. In addition, cost recovery mechanisms were noted by industry representatives as important to the success of E-911 deployment, so operating expenses could be recouped and deployment of services could move more quickly.

    The FCC adopted a Notice of Proposed Rulemaking (NPRM) [FCC 03-222], proposing ways to amend its spectrum regulations and policies in order to promote continued rapid deployment of spectrum based services in rural areas. The Commission proposed modifying construction requirements by allowing all providers of wireless services licensed on a geographic area basis to demonstrate “substantial service.” Also, the FCC proposes to remove or modify regulations that may impede rural service through the possible increase of power levels so coverage areas are exposed to more geography with a given amount of equipment. This rulemaking comes following a recently formed partnership last July between the FCC’s Wireless Telecommunications Bureau and U.S. Department of Agriculture Rural Services Utilities (USDA/RUS) [See Telecom/IT Policy Highlights July-August 2003]. Both agencies hope to develop uniform rules and processes to expand benefits for rural areas, while encouraging greater deployment of wireless services.


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  • Legislative Activities

    108th Congress Telecommunications Industry Related Legislative Update
    09.26.03 – Below is an updated list of key legislation introduced in the 108th Congress with potential impacts for the wireless industry. The bills focus primarily in the areas of broadband, spectrum, and E-911. [Source: The Cellular Telecommunications and Internet Association, Library of Congress, House Committee on Energy and Commerce, Senate Committee on Finance, House Subcommittee on Telecommunications and the Internet, Senate Committee on Commerce, Science, and Transportation]

    Broadband legislation that has been introduced primarily focuses on giving incentives such as tax credits to companies that deploy services to rural and underserved areas.

    H.R.267--Broadband Internet Access Act – This legislation is that of “the Rockefeller broadband tax credits proposal from last Congress that promotes the deployment of broadband by providing carriers with a three-year tax credit for providing next generation and current generation broadband services to rural and underserved areas.” [Source: CTIA] Current status of this legislation: House Ways and Means committee as introduced, no action taken.

    S. 160, Broadband Access Expenditures – “Amends the Internal Revenue Code to: 1) permit any qualified broadband expenditure which is paid or incurred by the taxpayer to be treated as an expense which is not chargeable to capital account; and (2) any expenditure so treated to be allowed as a deduction.” [Source: CTIA] Current status of this legislation: Senate Committee on Finance, no action taken.

    H.R. 363, Jumpstart Broadband Act – “Requires the FCC to allocate no less than an additional 255 megahertz of contiguous spectrum in the 5 gigahertz band for unlicensed use by wireless broadband devices while ensuring that Department of Defense devices and systems are not compromised. Directs the National Telecommunications and Information Administration to establish standards for interference protection which enable incumbent Federal government agency users of such allocated spectrum to continue such use. Directs the FCC to: (1) adopt minimal technical and device rules for efficient use of such allocated spectrum by wireless broadband devices; and (2) amend its rules to require that all wireless broadband devices manufactured after such rules amendment that operate in such allocated spectrum be capable of two-way digital communications and meet the interference protection standards.” [Source: CTIA] Current status of this legislation: House Subcommittee on Telecommunications and the Internet, no action taken.

    S. 159, Jumpstart Broadband Act - See H.R. 363 summary above. Current status of this legislation: Senate Committee on Commerce, Science, and Transportation, no action taken.

    Spectrum legislation has focused promoting emergency communications, competition, military and education preparedness, and commercial spectrum enhancement.

    S. 564, Emergency Communications and Competition Act of 2003 – This legislation “directs the Federal Communications Commission (FCC) to assign licenses in the 12.2-12.7 gigahertz band for the provision of fixed terrestrial communications services. Prohibits: (1) granting such a license if operations would interfere with direct broadcast satellite service; (2) such licenses from being used for the provision of personal communications or terrestrial telephony service. Requires licensees to begin providing services within five years after the license is granted.” [Source: CTIA] Current status of this legislation: Senate Committee on Commerce, Science, and Transportation Subcommittee on Communications as of 5.22.03.

    H.R.1320, Commercial Spectrum Enhancement Act “would establish a Spectrum Relocation Fund in place of the current mechanism for reimbursing Federal entities for the costs of relocating from spectrum reallocated for commercial use. The Spectrum Relocation Fund would be funded with the proceeds from the spectrum auction of the 1710-1755 MHz band and any other band reallocated from Federal to non-Federal use after January 1, 1995. Senate Commerce Committee Chairman John McCain (R-AZ) has introduced a companion measure, S.865.” [Source: CTIA] Current status of this legislation: Senate Committee on Commerce, Science, and Transportation. Ordered to be reported with an amendment favorably as of 6.22.03.

    H.R. 1396, Spectrum Commons and Digital Dividends Act of 2003 – This bill “allocates spectrum for the enhancement of wireless telecommunications, and to invest wireless spectrum auction proceeds for the military preparedness and educational preparedness of the United States for the digital era, and for other purposes.” [Source: CTIA] Current status of this legislation: House Subcommittee on Telecommunications and the Internet, no action taken since 4.10.03.

    E-911 legislation has focused on improving homeland security, public safety, and improving response times during emergencies through the use of enhanced wireless services.

    S. 1250, Enhanced Emergency 9-1-1 Act of 2003 – “A bill to improve, enhance, and promote the Nation's homeland security, public safety, and citizen activated emergency response capabilities through the use of enhanced 911 services, to further upgrade Public Safety Answering Point capabilities and related functions in receiving E-911 calls, and to support the construction and operation of a ubiquitous and reliable citizen activated system and other purposes.” [Source: CTIA] Current status of this legislation: Placed on Senate Legislative Calendar under General Orders. Calendar No. 254 as of 8.26.03.

    H.R. 2898, E-911 Implementation Act of 2003 – “To improve homeland security, public safety, and citizen activated emergency response capabilities through the use of enhanced 911 wireless services, and for other purposes.” [Source: CTIA] Current status of this legislation: Forwarded by Subcommittee to Full House Committee on Energy and Commerce (Amended) by Voice Vote as of 9.23.03.

    E-911 Legislation Amended in Subcommittee
    10.01.03 – The E-911 Implementation Act of 2003 [H.R. 2898] introduced by Rep. John Shimkus [IL-R] in July was approved by the House Commerce Subcommittee on Telecommunications and the Internet. The bill would create an E-911 Implementation Coordination Office under the National Telecommunications and Information Administration (NTIA) to coordinate efforts between local, state, and federal emergency communications systems, public safety personnel, and telecommunication carriers. In addition, it would allow for the appropriation of millions of dollars for emergency communications and provide penalties for states that shift monies from the E-911 fund that are specifically dedicated to E-911 deployment.

    In a hearing on the legislation [H.R. 2898] that took place on September 11, 2003 in the House Subcommittee on Telecommunications and the Internet, the executive director of the Tennessee Emergency Communications Board, Anthony Haynes, commented that the legislation will help move forward major advancements in areas of training, coordination, and financial assistance for many of the nations Public Safety Answering Points (PSAPs). Haynes notes that federal efforts in helping states with E-911 grants, in particular Phase 2 grants, would help states such as Tennessee that have rural populations with not enough substantive results with E-911 deployment. Phase 2 grants could help rural areas that have a limited tax base or few bonding opportunities. Also, he and Indiana’s State Treasurer Tim Berry commented that it was necessary to put in place language that protects the integrity of the 911 organizations and disbursement processes of grant monies through audits and assessments.

    Terry Addington, President and CEO of First Cellular of Southern Illinois, recommended that changing an entire network from one technology to another is massive and expensive, but will be necessary even if E-911 deployment is delayed. Those in industry want to make sure that the correct solutions are deployed for the right network, an aspect that is vital to the success of E-911.

    John Muleta, the Federal Communications Commission’s (FCC) Wireless and Telecommunications Bureau Chief, noted that data shows results are being made. According to Muleta, “every carrier using a hand-set based approach is offering at least one compliant handset” and 10% of the PSAPs across the nation already have Phase Two service.” [FCC Testimony Transcript from House Committee on Energy and Commerce] Muleta noted that industrys’ concerns over the ongoing need for PSAP education, cost recovery and PSAP funding issues, and lack of stakeholder coordination has been addressed through FCC guidance. Cost recovery demarcation issues, rulemaking on how the 911 rules should apply to technologies such as telematics services and emerging voice services and devices, and clarification of PSAP readiness issues and the establishment of a certification process were deemed important by the FCC to promote future E-911 deployment.

    View legislation at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:h.r.02898:. View markup of legislation at http://energycommerce.house.gov/108/Markups/09232003markup1084.htm View hearing at http://energycommerce.house.gov/108/Hearings/09112003hearing1068/hearing.htm. [Source: Library of Congress, House Committee on Energy and Commerce]

    Internet Tax Bill May Impact State Revenue
    09.25.03 – Legislation to continue a moratorium that is set to expire in November on “Internet access and traffic taxes” has passed the House, and now heads to the Senate. The Internet Tax Nondiscrimination Act [H.R. 49] introduced by Rep. Christopher Cox [CA-R] makes the existing tax moratorium permanent and applies such tax prohibition to all states, thus ending the existing authority of certain states to tax Internet access. Many states have argued that the language of the bill is very broad and may exempt the telecommunications industry entirely from state sales, income, and property taxes. Industry supporters of the bill believe arguments that are sensitive to such taxes are outside the purview of the bill. View legislation at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:HR00049:@@@L&summ2=m&. [Source: Library of Congress, C-Net]

    Senate Passes “Resolution of Disapproval” to Block FCC Media Rules
    09.16.03 - The Senate passed a resolution of disapproval [S.J.RES.17] to overturn recent new ownership rules [Report and Order (R&O), FCC 03-36] adopted by the FCC that would prevent a company from owning enough broadcast stations and newspapers to reach out to more than 35 percent of the nation’s viewers and readers. View Senate resolution at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:s.j.res.00017:. [Source: Library of Congress, Washington Post]


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  • Policy / Regulatory Activities

    Digital Television Transition Made Easier for Consumers
    09.10.03 – The FCC has adopted new standards that would make digital televisions more compatible with offerings that cable companies provide. This move is to help accelerate forward the transition of consumers to digital television and high definition sets. The Second Report and Order (R&O) and Further Notice of Proposed Rulemaking (FNPRM) [FCC 03-225] permits TV sets to be built with “plug and play” functions for one-way digital cable services. The FCC also notes that consumers will need a set-top box that will allow two-way services to be received for such things as video-on-demand and cable operator-enhanced electronic programming guides. In addition, the cable and electronics industries also filed a model license for the Dynamic Feedback Arrangement Scrambling Technique (DFAST) scrambling technology to protect content from unauthorized use. The new rules are an attempt to aid the transition to digital television by promoting competition and convenience for consumers. View press release at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-238850A1.txt. [Source: FCC]

    Unlicensed Devices: FCC Proposes Changes
    09.10.03 – The FCC is seeking comment on an issued Notice of Proposed Rulemaking (NPRM) [FCC 03-223] that would permit operators such as wireless internet service providers (WISPs) and device manufacturers to “readily modify or substitute technically equivalent parts, facilitating increased deployment of broadband services.” WISPs currently use unlicensed devices to provide a broadband alternative for underserved areas. Some of the rule changes that the FCC proposes within the NPRM include removing unnecessary regulations that obstruct deployment of advanced technologies for wireless networking, rule modifications that would make possible the deployment of “next-generation Bluetooth devices” that run at data rates up to three times faster than current devices, and rule changes that would reduce restrictions that are related to system design and equipment authorizations for unlicensed devices. [Comments will be due thirty days after the NPRM is published in the Federal Register]. View press release at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-238842A1.txt. [Source: FCC]

    Unbundled Network Elements: NPRM Released to Review Rules
    09.10.03 – The FCC has issued a Notice of Proposed Rulemaking (NPRM) [WC Docket 03-173, FCC 03-224] to review rules regarding the pricing of unbundled network elements (UNEs) and the resale of service by incumbent local exchange carriers (ILECs). This proceeding was initiated to consider whether the Total Element Long Run Incremental Cost (TELRIC) methodology is working properly and whether it is favorable towards efficient facilities investment. The FCC notes that while their UNE pricing rules must produce rates that are consistent with the 1996 Telecommunications Act’s goal of promoting sustainable competition, they should not create incentives for carriers to avoid investment in facilities. The NPRM also seeks comment on the impacts of changes in unbundling obligations resulting from the Triennial Review Order on UNE pricing and comment on what resale pricing rules the FCC should adopt. [Comments will be due thirty days after the NPRM is published in the Federal Register]. View NPRM at http://hraunfoss.fcc.gov/edocs_public/ attachmatch/ FCC-03-224A1.txt . [Source: FCC]

    Wireless Services in Rural Areas Promoted by FCC
    09.10.03 – Recently, the FCC adopted a Notice of Proposed Rulemaking (NPRM) [FCC 03-222], proposing ways to amend its spectrum regulations and policies in order to promote continued rapid deployment of spectrum based services in rural areas. The Commission proposed modifying construction requirements by allowing all providers of wireless services licensed on a geographic area basis to demonstrate “substantial service.” Also, the FCC proposes to remove or modify regulations that may impede rural service through the possible increase of power levels so coverage areas are exposed to more geography with a given amount of equipment. Also, the FCC is examining the effect of the use of small versus large geographic licensing areas, in particular comment is sought on the costs of dividing license areas as compared to costs of aggregating these areas during or after the auction process. Finally, another important issued being examined are better ways to promote access to the equipment necessary to provide service in rural markets. [Comments will be due thirty days after the NPRM is published in the Federal Register]. View press release at http://hraunfoss.fcc.gov/edocs_public/ attachmatch/DOC-238840A1.txt . [Source: FCC]


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  • Other Activities and Items of Interest

    10-Point Consumer Code for Wireless Carriers Unveiled
    09.09.03 - The Cellular Telecommunications & Internet Association (CTIA) along with many of the nation's wireless carriers have unveiled a 10-point Consumer Code that enumerates voluntary industry principles, disclosures and practices. The voluntary Consumer Code according to the CTIA “will help consumers make informed choices when purchasing wireless services, better understand their wireless services and rate plans, and ensure that wireless carriers continue to meet their needs.” Some of the items within the 10-Point Code include: when initiating or changing service, carriers will clearly state contract terms to customers and confirm changes in service; promptly respond to consumer inquiries and complaints received from government agencies; and abide by policies for the protection of customer privacy. View complete list at http://www.wow-com.com/news/press/body.cfm?record_id=1311. [Source: CTIA]

    Hearing Aid Compatibility (HAC) Incubator Applauded
    09.04.03 – The Hearing Aid Compatibility Incubator [www.atis.org/atis/hac/hacwg.htm] of the Alliance for Telecommunications Industry Solutions (ATIS) www.atis.org was unveiled to bring together representatives of the wireless and hearing aid industries to share information and discuss technical issues associated with implementing changes to digital wireless phones in accordance with the FCC’s compatibility rules. According to the Alliance for Telecommunications Industry Solutions (ATIS), the incubator will “create an independent assessment of the current hearing aid compatibility standard, popularly known within the wireless and hearing aid industries as ANSI C63.19.” “Among its activities, the HAC Incubator is expected to investigate and develop recommendations for measuring hearing aid immunity, magnetic coupling, and interference believed to be caused by wireless devices. Findings from the HAC Incubator’s investigation will be released to the FCC, and to the Food and Drug Administration (FDA).” View press release at http://hraunfoss.fcc.gov/edocs_ public/attachmatch/DOC-238664A1.txt. [Source: ATIS, FCC]

    Commissioner Abernathy Speaks on Broadband Over Powerlines
    09.22.03 – FCC Commissioner Kathleen Abernathy discussed some of the regulatory issues surrounding broadband over power lines (BPL) at the United Powerline Council (UPLC) Annual Conference in Washington D.C. She believes the FCC can play an important role in making BPL possible to communities through regulation that will not put in place too many barriers for its deployment. She said that as new “technology platforms” are reached, the Commission should not put regulation in place that “no longer serve their intended purpose.” She continued “many of our old rules not only become unnecessary as markets evolve, but they can be fatal to new services that need room to breathe.” By forming an environment that is favorable to investment in new infrastructure, Abernathy says that competition will be created through overcoming short-term regulatory disparities. Abernathy believes that although BPL will do away with many “competition-related” regulations, other modes of regulation will remain necessary. View UPLC press release at http://www.uplc.org/?cbr_v=dcb&nt=true &cbr_eid=18648&p=admin&ct=contentbrowser . [Source: United Powerline Council]

    North Carolina Establishes New Authority for High-Speed Internet
    08.28.03 – Governor Michael Easley of North Carolina has recently enacted into law a measure that shifts the public/private Rural Internet Access Authority (RIAA) under the newly created e-NC Authority. The RIAA will be able to use its experiences with wireless technologies to help foster development of high-speed services in poor urban areas as they have in remote rural areas with this change. The new e-NC Authority will begin using the FCC’s definition of high-speed access as a baseline for internet services in urban and rural areas. View http://www.e-nc.org. [Source: e-NC Authority, Federal Computer Week]


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  • Research/ Reports

    FCC Releases Working Paper on TELRIC Pricing Rules
    09.15.03 – The FCC’s Office of Strategic Panning and Policy Analysis released a staff working paper entitled “Dynamic Pricing and Investment from Static Proxy Models,” evaluating the use of static computer cost models and cost studies typically used by regulators in setting “forward-looking” prices.” Section 2 of the paper addresses the argument that “periodic recalculation of Total Element Long Run Incremental Cost (TELRIC) prices prevents incumbents from recovering the cost of their investment.” Section 3 examines a “carrier’s cost minimizing investment plan in a dynamic environment with large fixed investment costs.” Finally, the authors provide a comparison of the “time path of prices which result from a particular implementation of TELRIC pricing with the time path of prices that would occur in a contestable market, which may be defined as a market in which entry barriers are absent. View paper at www.fcc.gov/osp . [Source: FCC]


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  • OTP/GCATT Events

    OTP Public Policy Luncheon Discussed MuniTIP Project
    09.17.03 – The recently completed Municipal Advanced Telecommunications Infrastructure Project (MuniTIP) conducted by the Office of Technology Policy and Programs (OTP) at the Georgia Centers for Advanced Telecommunications Technology (GCATT), was the centerpiece for a discussion on municipal telecommunication infrastructure deployment. Panelists included Commissioner David Burgess of the Georgia Public Service Commission; Larry Hanson, City Manager of Valdosta, Georgia; Phil Jacobs, President, BellSouth Georgia; and David Muschamp, President and CEO of Georgia Public Web, Inc. The study provided a broad overview of pertinent issues, policy considerations, and approaches.

    MuniTIP concluded that there is not a simple model of the role municipalities can or should play in undertaking advanced information infrastructure development. Further, evaluation of the political and telecommunications environment needs to be undertaken as well as a comprehensive assessment made of both available resources and community commitment. View MuniTIP at http://www.gcatt.org/otp/papers/MuniTIP.pdf. [Source: GCATT Office of Technology Policy and Programs]

    Wireless Internet and Municipal Government Summit in Atlanta
    09.26.03 – November 19 and 20, 2003, the Wireless Internet Institute and Atlanta Mayor’s Office of Community Technology will hold a municipal summit at the Georgia Tech Hotel. This summit will create opportunities for dialogue among local elected officials, municipal technology executives, industry practitioners, and regulators. “The conference, featuring plenary sessions and structured brainstorming workshops will seek to establish strategies necessary to overcome obstacles and develop environments favourable to the broad deployment of Wireless Internet infrastructures in metropolitan areas focusing on the following critical themes: case studies and what was the role of various constituents, business models and partnerships in support of wireless Internet, benefits to citizens, local government, community development, economic development, the leadership role of Mayors in promoting Wireless Internet applications and developing policies. View information on conference at http://www.w2i.org/pages/atlanta112003/manifesto.html . [Source: The Wireless Internet Institute]


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  • Newsletter Info

    Center for Advanced Communications Policy
    Telecom/IT Policy Highlights
    September 2003

    The focus of this publication is to present legislative, regulatory, legal, and other activities that are germane to technology policy news, events or products. For additional information regarding the information provided in this report, or if there are newsworthy items that should be included in future editions, please feel free to contact , Director of Research and Editor in Chief.
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