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Telecom/IT Policy Highlights

Volume: 8.07
August/September 2008

Microsoft Word version / Aug/Sep, 2008 TiPH (180kB)

Adobe PDF version / Aug/Sep, 2008 TiPH (111kB)

Contents:
Overview
Legislative Activities
Policy / Regulatory Activities
Judicial Activities
Studies / Reports
Other Activities and Items of Interest
Upcoming Events
Newsletter Info
  • Overview

    This Fall edition of the TIPH considers developments in telecommunications and IT policy for the months of August and September. During the past two months, Congress and the courts have been relatively inactive in this area, although there are a couple of developments worth noting. In late September, the President signed into law the “Identity Theft Enforcement and Restitution Act,” a piece of legislation designed to provide restitution for victims of identity theft and similar fraudulent acts. At the same time, this new law expands interstate and foreign jurisdiction for the prosecution of computer fraud offenses, as well as imposes criminal and civil forfeitures of property used to commit computer fraud offenses. It also provides for stricter sentencing of individuals convicted of committing these crimes.

    Meanwhile, the courts continued to address the issue of wireless service billing in Peck v. Cingular Wireless,, a class action lawsuit that alleges that a cellular phone company’s inclusion of a line item on its monthly bills violates a Washington state statue. At issue is a state business and occupation tax that Cingular (now AT&T Wireless) decided to pass on to its customers in Washington. Overturning a U.S. District court’s opinion declaring the case had no merit, the Court of Appeals’ ruling will allow the matter to receive a full hearing in the courts.

    The most important developments took place in the regulatory arena, where the FCC adopted and released a number of rulings addressing, among other things, emergency communications and the creation of a Commercial Mobile Alert System (CMAS), reporting requirements for telephone carriers, and the ongoing digital television (DTV) transition. Perhaps the most important story during the past two months was the FCC’s investigation of complaints that Comcast Corporation had been inhibiting customers of its high speed Internet service from using file sharing software such as BitTorrent, which is used by people for downloading music, movies, and software. In response, the Commission ruled that Comcast must cease its discriminatory network management practices by the end of the year.


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  • Legislative Activities

    Identity Theft Enforcement and Restitution Act Passed into Law

    09.26.2008 – On September 26, 2008, the President signed into law the “Identity Theft Enforcement and Restitution Act” [Public Law No. 110-326] as part of a larger bill that combined several unrelated pieces of legislation. First introduced by Rep. John Conyers (D-MI) in May, this new law amends 18 U.S.C. § 1030, the statute in the federal criminal code that covers computer fraud and hacking. The new law provides for restitution for victims of identity theft, to compensate them for the time spent to remediate the intended or actual harm they incurred. It also eliminates the requirement that damage to a victim’s computer must aggregate at least $5,000 before prosecution can be brought for unauthorized access to a computer.

    In addition, the “Identity Theft Enforcement and Restitution Act” allows for prosecution of criminal fraud offenses for conduct not involving an interstate or foreign communication. The law also makes it a felony, during any one-year period, to damage 10 or more protected computers used by or for the federal government or a financial institution; expands the definition of “cyber-extortion” to include a demand for money in relation to a protected computer; and outlaws conspiracies to commit computer fraud.

    The Act expands interstate and foreign jurisdiction for the prosecution of computer fraud offenses, as well as imposes criminal and civil forfeitures of property used to commit computer fraud offenses. Finally, the new law directs the U.S. Sentencing Commission to review its guidelines and policy statements for the sentencing of persons convicted of identity theft, computer fraud, illegal wiretapping, and unlawful access to stored information, in order to reflect Congress’s intent that penalties for these offenses be increased.

    The text of the Act, as it was signed into law by the President, is not yet available from the Government Printing Office. In the meantime, the version agreed to by the House and Senate may be found at [http://thomas.loc.gov/cgi-bin/query/D?c110:6:./temp/~c110jxwPPZ::]. [Source: Library of Congress]

    Laptop Computer Search Bill Introduced in House

    09.11.2008 – On September 11, 2008, Reps. Loretta Sanchez (D-CA) and Bennie Thompson (D-MS) introduced the “Border Security Search Accountability Act of 2008” [H.R. 6869]. The bill is designed to address unnecessary, abusive and unreasonable searches of laptop computers and other devices by customs agents. If passed into law, it would require the Department of Homeland Security (DHS), which oversees customs, to craft a rule regarding border security searches of electronic devices.

    The bill would mandate that this rule contain a “requirement that information collected during a border security search of an electronic device that is determined to be commercial information, including trade secrets, information subject to attorney-client privilege, information subject to doctor-patient privilege, or information subject to another privilege or protection shall be handled consistent with the laws, rules, and regulations governing such information and shall not be shared with a Federal, State, local, tribal, or foreign agency unless it is determined that such agency has the mechanisms in place to comply with such laws, rules, and regulations." The bill was introduced into the House, and then referred to the House Committee on Homeland Security for consideration. For a copy of the bill, please see [http://thomas.loc.gov/cgi-bin/query/z?c110:H.R.6869:]. [Source: Library of Congress]


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  • Policy / Regulatory Activities

    Comcast Ordered by FCC to End Discriminatory Network Management Practices

    08.01.2008 – The FCC adopted and released a Memorandum Opinion and Order [FCC 08-183] in response to complaints that Comcast Corporation had been inhibiting customers of its high speed Internet service from using file sharing software such as BitTorrent, which is used by people for downloading music, movies, and software. In response to complaints filed by two public advocacy groups, Free Press and Public Knowledge, the FCC concluded that Comcast had unduly interfered with Internet users’ right to access the lawful Internet content and to use the applications of their choice. In a 3-2 vote, the Commission ordered that Comcast must cease its discriminatory network management practices by the end of the year. Under the plan, within 30 days of release of the MO&O Comcast must disclose the details of its discriminatory network management practices to the Commission; submit a compliance plan describing how it intends to stop these discriminatory management practices by the end of the year; and disclose to customers and the Commission the network management practices that will replace current practices.

    For a copy of this MO&O, please see [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-183A1.txt] (MS Word and PDF versions also available). [Source: FCC]

    Commercial Mobile Alert System Details Considered in Latest Rulemaking

    08.07.2008 – The FCC adopted and released its Third Report and Order [FCC 08-184] as part of its efforts to establish a Commercial Mobile Alert System (CMAS) to provide emergency and other government alerts to the public by way of cell phones and other mobile devices. The proposed CMAS is a voluntary program in which carriers can elect to participate.

    In this latest R&O, the FCC addressed carrier participation in this program, as well as notices to consumers, existing subscribers, and the Commission. Most important, the Order rules that carriers who choose not to participate in the CMAS and elect not to send alert messages must provide notice of this fact to consumers, especially people with disabilities, at the point of sale for the carrier’s devices and services, whether a store, kiosk, or website. The Order requires carriers to notify existing subscribers of their decision not to transmit CMAS messages. The new rules also require all CMS providers to provide a letter to the FCC regarding whether they will participate.

    For a copy of this Third R&O, please see [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-184A1.txt] (MS Word and PDF formats also available). [Source: FCC]

    Licensing of 700 MHz D Block for Emergency Communications Reconsidered

    09.25.2008 – The FCC adopted and released its Third Further Notice of Proposed Rulemaking (FCC 08-230) that proposes licensing the 700 MHz D Block spectrum as part of a revised 700 MHz private/public partnership designed to maximize both the public safety and commercial benefits of a nationwide, interoperable broadband network in the 700 MHz band. This Notice follows FCC consideration on the future of the D Block after it failed to meet its $1.3 billion reserve price in the 700 MHz auction held in May 2008.

    A primary goal of the FCC is the deployment of a broadband network that would provide maximum coverage for first responders throughout the nation. Absent other sources of funding, the current Notice proposes to retain a public/private partnership model for the 700 MHz D Block. The Notice proposes a modified set of rules to govern the D Block and a revised auction plan for assigning D Block licenses. Specifically, the FCC plans to use the competitive bidding process to determine whether, based on greatest population coverage and highest bid(s), the D Block spectrum would be licensed to a single licensee on a nationwide basis or to regional licensees on the basis of 58 public safety regions.

    The Notice also seeks comment on a number of issues, including rules involving significant clarifications and revisions of the respective obligations of the D Block licensee(s) and the Public Safety Broadband License regarding the construction and operation of the shared wireless broadband network. The clarifications and revisions address the use of spectrum in the shared wireless broadband network (including requirements regarding public safety priority access to commercial capacity in emergencies), the technical requirements of the shared wireless broadband network (including detailed proposals relating to interoperability, robustness, capacity, quality of service, and security), the coverage requirements of the broadband network(s), and the respective operational roles of the D Block licensee(s) and the Public Safety Broadband Licensee.

    The Notice also presents a number of specific proposals with regard to the rules governing public safety users and the Public Safety Broadband License. The Notice proposes, for example, that eligible users of the public safety broadband spectrum capacity must be providers of “public safety services” as defined under federal law. The Notice also proposes that the Public Safety Broadband Licensee should remain a non-profit entity, and that certain restrictions be imposed on its business relationships to avoid the potential for conflicts of interest. Further, the Notice proposes a number of changes to the Public Safety Broadband Licensee’s organizational structure to enhance its operational efficiency and transparency. For a copy of the Third FNPRM, please see [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-230A1.txt] (MS Word and PDF formats also available). Comments will be due within 30 days of publication of the Notice in the Federal Register, and reply comments will be due 10 days later. [Source: FCC]

    Reporting Requirements for Telephone Carriers Relaxed by FCC

    09.06.2008 – The FCC adopted and released a Memorandum Opinion and Order and Notice of Proposed Rulemaking (FCC 08-203), that grants, in part, a number of petitions filed by telephone carriers seeking forbearance from certain legacy and reporting requirements. In its MO&O, the FCC relaxed its rules mandating the filing of certain Automated Reporting Management Information System (ARMIS) reports, particularly those related to service quality, customer satisfaction, and infrastructure and operating data. The FCC had required that incumbent local exchange carriers (ILECs) provide regular reports in order to ensure that these carriers did not lower quality of customer service to increase short-term profit or fail to invest in infrastructure. Given the changing nature of the telecommunications marketplace, and in response to the petitions for forbearance received by the Commission, the FCC determined that the ARMIS service quality and infrastructure reporting requirements are not “necessary to ensure that the charges, practices, classifications or regulations by, for, or in connection with that telecommunications carrier . . . are just and reasonable and are not unjustly or unreasonably discriminatory” under current regulations.

    However, the FCC did determine that “collection of certain of that information might be warranted, if tailored in scope to be consistent with Commission objectives, and if obtained from the entire relevant industry of providers of broadband and telecommunications.” As such, the FCC has also issued an NPRM seeking comment on whether and how the Commission should collect such data on an industry-wide basis.

    A copy of this MO&O and NPRM may be found at [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-203A1.txt] (MS Word and PDF versions also available). Comments will be due 30 days after publication in the Federal Register, and reply comments will be due 60 days after publication. [Source: FCC]

    Small Cable Systems Exempt from DTV Carriage Regulations, FCC Rules

    09.04.2008 – The FCC adopted and released its Fourth Report and Order (FCC 08-193) as part of its proceeding entitled “In the Matter of Carriage of Digital Television Broadcast Signals: Amendment to Part 76 of the Commission's Rules.” In it’s Order, the FCC ruled that cable systems that either have 2,500 or fewer subscribers and are not affiliated with a large cable operator, or have an activated channel capacity of 552 MHz or less, are exempt from the Commission’s requirement to carry high definition versions of broadcast signals for three years following the digital television (DTV) transition. The ruling is designed to ease the burden that dual “must carry” requirements would have imposed upon smaller cable systems.

    A copy of the Fourth R&O may be found at [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-193A1.txt] (MS Word and PDF versions also available). [Source: FCC]

    Wireless Microphones Operating in 700 MHz Band Focus of Rulemaking

    08.21.2008 – The FCC adopted and released a Notice of Proposed Rulemaking and Order [FCC 08-188] that proposes a prohibition on low power auxiliary stations, including wireless microphones, from operating in the 700 MHz band after the completion of the DTV transition on February 17, 2009. The Notice proposes that the FCC prohibit the manufacture, import, sale, or shipment of devices that operate as low power auxiliary stations in the 700 MHz Band after the end of the DTV transition, in order to ensure that low power auxiliary operations do not cause harmful interference to new public safety and commercial wireless services in the band.

    Low power auxiliary stations are technologies authorized for such uses as wireless microphones, cue and control communications, and synchronization of TV camera signals. Of the 943 active low power auxiliary station licenses, 156 are currently permitted to operate in the 700 MHz Band. Of those 156 licenses, most are authorized to operate in other spectrum bands as well, and only 30 are authorized to operate only in the 614-806 MHz band, of which the 700 MHz Band is a part. After the end of the DTV transition, low power auxiliary stations would be able to continue operating in additional spectrum bands that allow such operations on a secondary basis, including certain broadcast television channels below 700 MHz.

    For a copy of the NRPM and Order, please see [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-188A1.txt] (MS Word and PDF formats also available). [Source: FCC]


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  • Judicial Activities

    Wireless Billing Dispute Case Affirmed by Court of Appeals

    08.07.2008 – The U.S. Court of Appeals for the Ninth Circuit delivered its opinion in Peck v. Cingular Wireless, a class action lawsuit that alleges that a cellular phone company’s inclusion of a line item on its monthly bills violates a Washington state statute. At issue is a charge of 31 cents, entitled a “State B&O Surcharge,” added to the bills of Cingular (now AT&T Wireless) customers in Washington. The charge refers to a state business and occupation tax that the carrier decided to pass onto its customers. In response, Cingular customer Jared Peck filed suit, contending that the line item was in violation of Washington state law, which noted of the B&O tax that, “it is not the intention of this chapter that the taxes herein levied upon persons engaging in business be construed as taxes upon the purchasers or customers, but that such taxes be levied upon, and collectible from, the person engaging in the business activities herein designated and that such taxes shall constitute a part of the operating overhead of such person.” Peck alleged that Cingular failed to disclose that it would pass this State B&O Surcharge on to its customers, and thus, he also pled breach of contract, unjust enrichment, and violation of Washington's Consumer Protection Act.

    The lawsuit was originally dismissed by District Court, which claimed that a federal statue governing mobile services preempted the claim. U.S.C. 47 § 332(c)(3)(A) maintains that “no State or local government shall have any authority to regulate the entry of or the rates charged by any commercial mobile service or any private mobile service.” On appeal, the Court of Appeals reversed the judgment of the District Court, effectively ruling in favor of the original plaintiff and allowing the lawsuit to proceed.

    A copy of the Court of Appeals’ ruling may be found at [http://www.ca9.uscourts.gov/ca9/newopinions.nsf/05DB7928C31464B08825749D0079DC2A/$file/0636027.pdf] (PDF only). [Source: 9th Circuit Court of Appeals]


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  • Studies / Reports

    Local Telephone Competition Report Released by FCC

    09.19.2008 – The FCC has released its latest data on local telephone competition in the United States. Released twice a year as part of the Commission’s requirement that all incumbent local exchange carriers (ILECs) and competitive local exchange carriers (CLECs) report basic data about their services to the FCC, this latest report highlights statistics as of December 31, 2007.

    According to the latest data gathered by the FCC, end-user customers obtained local telephone service by utilizing approximately 129.7 million ILEC switched access lines, 28.7 million CLEC switched access lines, and 249.2 million mobile telephony service subscriptions at the end of December 2007. Of the 28.7 million CLEC end-user switched access lines, 8.4 million of them were provided over coaxial cable connections. There was at least one CLEC serving customers in 81 percent of the nation’s ZIP codes at the end of December 2007, and about 97 percent of United States households resided in those ZIP codes. Multiple carriers reported providing local telephone service in the major population centers of the country. Perhaps even more notable, mobile telephone service providers reported 249.2 million subscribers at the end of December 2007, which is 19.6 million, or 9 percent, more than a year earlier.

    For a copy of the report, please see: [http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-285509A1.txt] (MS Word and PDF versions also available). [Source: FCC]

    Network Worker Report Released by Pew Internet

    09.24.2008 – The Pew Internet & American Life Project has released the results of a national survey that shows that 62 percent of adults who are currently employed use the Internet or e-mail at work. The study found that this group has mixed views about the impact of technology on their work lives. Many respondents note the benefits of increased connectivity and flexibility that the Internet and communications technologies affords them at work. Conversely, many workers observe these tools have added stress and new demands to their lives.

    This survey also finds that 96 percent of those who work use the Internet, e-mail, or have a cell phone for some purpose in their lives, even if not specifically related to work. The Pew survey has termed this larger group "wired and ready workers." When asked how the Internet has affected their work lives, the survey found that 80 percent responded that technologies have improved their ability to do their job; 73 percent note that these technologies have improved their ability to share ideas with co-workers; and 58 percent believe that such technologies have allowed them more flexibility in the hours they work.

    For a copy full copy of the Pew Internet survey, please see [http://www.pewinternet.org/PPF/r/264/report_display.asp]. [Source: Pew Internet]


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  • Other Activities and Items of Interest

    Consumers Urged to Apply for DTV Converter Box Coupons before End of Year

    09.30.2008 – The National Telecommunications and Information Administration (NTIA) has announced that “over-the-air” television viewers who want to participate in the federal Television Converter Box Coupon Program should apply for coupons before the end of the year, in order to minimize the chances of losing television reception when full-power broadcasters switch completely to digital transmission on February 17, 2009. The NTIA stresses that households who rely on an antenna, rather than cable or satellite, for television reception need to apply early in order to minimize the number of Americans adversely affected when the DTV transition is completed.

    For consumers receiving free, over-the-air broadcasts on analog televisions, the NTIA has outlined a three-step process to make the transition to digital television. First, consumers should apply for a coupon now. Coupons are available on a first-come, first-serve basis. Consumers can apply for coupons online at [http://www.DTV2009.gov] or by phone at 1-888-DTV-2009 (1-888-388-2009), as well as by fax or mail. Second, consumers should buy their converter boxes soon after their coupons arrive in the mail. Consumers will receive a list of participating local, phone and online retailers with their coupons. Viewers are urged by the NTIA to make their choice before the end of the year. Finally, once a consumer has purchased a converter box, they should connect the box to their analog set immediately and follow the installation and channel scanning instructions, and make antenna adjustments, if needed. This provides the opportunity to test the converter box and troubleshoot potential problems prior to the transition date.

    For more information about the Coupon Program, please visit [http://www.DTV2009.gov]. For questions about the DTV transition, go to [http://www.dtv.gov], or call 1-888-CALL-FCC. [Source: NTIA]

    U.S. Mobile Market Slow in Third Quarter as Economic Concerns Build

    09.11.2008 – During the second quarter of 2008, the U.S. mobile telecommunications market experienced a marginal recovery compared to the depressed levels of the first quarter. There were 4 million net additions, taking the total number of customers to 261.5 million, up from 243.3 million one year ago. Overall mobile phone penetration has now reached 86.1 percent in the U.S., compared to 80.8 percent in June 2007. At the same time, overall growth in the U.S. mobile market is expected to slow in the third quarter as the U.S. economy faces continued challenges.

    However, according to Cellular-News.com, the process of consolidation that has been a distinctive feature of the cellular market has continued into the current year, the latest deal being the acquisition of Alltel by Verizon. Upon completion, this merger will create a new industry leader out of Verizon, with a total of 82.2 million customers, equivalent to 31.4% market share and ahead of AT&T, which will lag its rival by nearly 10 million connections. In fact, the enlarged Verizon will now be larger than the third and fourth largest carriers, Sprint Nextel and T-Mobile USA, combined. [Sources: Cellular-News.com and CNN.com]


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  • Upcoming Events

    Broadband Policy Meeting: Federal-State Joint Conference on Advanced Services

    11.06.2008 - The FCC has announced that the Federal-State Joint Conference on Advanced Services will hold a meeting on broadband policy on Thursday, November 6, 2008. The meeting will take place at the Wireless Communications Association International’s 14th Annual Symposium and Business Expo at the Fairmont Hotel in San Jose, California. A time for the meeting is to be announced, and additional details about the meeting will be made available to the public in the near future.

    For more information, please see the press release at [http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-285684A1.txt] (MS Word and PDF versions also available). [Source: FCC]

    First Responders Speaker’s Series: Public Safety and Homeland Security Bureau

    10.22.2008 – The FCC’s Public Safety and Homeland Security Bureau is launching a new speaker’s series to provide first responders with the latest news and developments on public safety communications and related initiatives. The first in a series of these sessions will be hosted by the Bureau on Wednesday, October 22, 2008, from 11:00 a.m. to 12:00 p.m., at the Commission Meeting Room (TW-C305).

    Laurie Flaherty, program analyst for the Office of Emergency Medical Services, National Highway Traffic Safety Administration, will be the first expert speaker. She will discuss the U.S. Department of Transportation’s (DOT’s) role in 911 issues. Ms. Flaherty’s presentation will specifically focus on the work of the Research and Innovative Technologies Administration, as well as recent developments in Next Generation 911 services.

    This speaker’s series will be open to the public, but admittance will be limited to the seating available. Individuals who are interested in attending may pre-register on-line at [www.fcc.gov/pshs/speakerseries911.html]. Those who pre-register will be asked to provide their name, title, organization affiliation, and contact information. The deadline for pre-registration is Monday, October 20, 2008. For those attendees with disabilities, reasonable accommodations are available upon request, but such requests need to be made as soon as possible. In addition, the meeting will be broadcast live with open captioning over the Internet from the FCC's web page at [www.fcc.gov/realaudio]. This webcast is free to the public and does not require pre-registration.

    For more information about this series, please visit [http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-285829A1.txt] (MS Word and PDF versions also available) for a copy of the press release. [Source: FCC]


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  • Newsletter Info

    Center for Advanced Communications Policy
    Telecom/IT Policy Highlights Volume 8.07
    August/September 2008
    Nathan W Moon, Editor

    Telecom/IT Policy Highlights presents legislative, regulatory, legal, and other items of interest pertinent to information, telecommunications, and related technology policy and research. For additional information regarding the information provided in this report, or if there are newsworthy items that should be included in future editions, please contact , Research Specialist

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