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. Follow our Telecom Group on Twitter! Click here.

Jump to a Topic:
FCC Announcements l The Mobile Market l FTC and Privacy Regulation l New Markets: Smart Grid and E-Health l Intercarrier Compensation l Compliance Notes l Broadband News l In the Courts l Legislative Outlook l Events

Federal Communications Commission (FCC) Announcements

• The FCC is convening the .Gov Developer Meet Up today, April 16, 2012, from 11:00 am to 3:00 pm Eastern. The Meet Up will enable agencies to showcase how they make data available through application program interfaces (APIs) and introduce them to the developer community. For more information, click here.
• The Technical Advisory Board for First Responder Interoperability will hold a public workshop on April 23, 2012, from 8:30 am to 12:30 pm Eastern at FCC Headquarters in Washington, DC. The purpose of this workshop is to share information about necessary minimum technical requirements for a nationwide, interoperable public safety broadband network. For more information, click here.
• The FCC has released the Tentative Agenda for its next Open Meeting on April 27, 2012, at 11:00 am Eastern. It contains five items, including a Report and Order and Further Notice of Proposed Rulemaking on “cramming” and a Further Notice of Proposed Rulemaking on modernizing the contribution system for the Universal Service Fund. To view the Tentative Agenda, click here.
• The FCC seeks comment on the petition for expedited declaratory ruling of Soundbite Communications that sending one-time, confirmatory messages when a consumer opts out of receiving text messages does not violate the Telecommunications Consumer Protection Act (TCPA). Comments are due April 30, 2012, and Reply Comments are due May 15, 2012. The petition is available here. The Notice establishing filing deadlines is available here. CG Docket No. 02-278.
  
  Read our Client Alert on this proceeding here.

Please contact Ross Buntrock, Alan Fishel, Michael Hazzard, or Jon Canis (contact information below) for further information.

The Mobile Market

• On April 11, 2012, the U.S. Department of Justice (DOJ) announced the filing of a much-anticipated antitrust lawsuit (see March 12 edition of This Week in Telecom) against Apple, Inc. and five publishers alleging that they conspired to fix the price of e-books. DOJ simultaneously announced that it had reached a proposed settlement agreement with three of the publishers, Hachette Book Group (USA), HarperCollins Publishers LLC and Simon & Schuster, Inc., that would invalidate their existing sales agreements for e-books with Apple and certain other e-book retailers and bar them “for five years from again conspiring with or sharing competitively sensitive information with their competitors.” The settlement agreement would impose reporting requirements designed to empower DOJ to ensure that the companies are complying with the mandates of the settlement agreement. Federal law requires that the proposed settlement be published and that DOJ receive public comment for a period of 60 days before the settlement can be accepted by the court. The two publishers named in the complaint that have not reached settlements are Holzbrinck Publishers LLC d/b/a Macmillan and Penguin Group (USA). More information, including the complaint and proposed settlement, are available here.
• AT&T, Sprint, T-Mobile, and Verizon have agreed to deploy databases designed to reduce the growing number of thefts of wireless smartphones and tablets. Under the plan announced last week, a database will prevent stolen devices from being activated on the networks of other carriers. The database will maintain a list of international mobile equipment identifiers (IMEIs) associated with stolen devices. AT&T and T-Mobile anticipate having their databases deployed by October 31, 2012, while Verizon and Sprint are expected to deploy by November 30, 2013. The carriers will also undertake a public education campaign this summer, including public service announcements and online tools, to improve consumers’ knowledge about how to lock and secure devices electronically and how to remotely wipe sensitive data from stolen devices. FCC Chairman Julius Genachowski threatened that the Commission could open proceedings if the carriers do not follow through on their promises. The Chairman’s remarks about this so-called PROTECT Initiative are available here.
• The Canadian Radio-television and Telecommunications Commission has opened a proceeding to consider whether Canada should begin to regulate retail wireless services. As has the United States, the CRTC previously declined to impose regulations on the wireless market, believing that there was sufficient competition to impose constraints on wireless carriers. But according to the Notice of Consultation released April 4, 2012, “the Commission is seeking comments on whether the conditions for forbearance have changed sufficiently to warrant Commission intervention in the development of a national retail wireless services consumer code.” Interested parties must intervene by May 3, 2012, and Reply Comments must be filed by May 14, 2012. The Commission expects to issue a ruling about four months later. The Notice of Consultation is available here.
• The FCC seeks comment on the impact of a public safety network on Commercial Mobile Radio Service by April 30, 2012, with Reply Comments due May 30, 2012. The call for comments was issued in response to a decision to suspend service in San Francisco’s subway system last August. The Public Notice asks for comment on several topics, including: past practices and precedents; bases for interrupting wireless service; risks in interrupting mobile communications; scope of interruption; authority to interrupt service; and the legal constraints on service disruption. The notice is available here.

Please contact Ross Buntrock, Michael Hazzard, or G. David Carter (contact information below) for further information.

Federal Trade Commission (FTC) and Privacy Regulation

• The FTC will hold a workshop on April 26, 2012, titled “Paper, Plastic . . . or Mobile? An FTC Workshop on Mobile Payments". It will examine the use of mobile payments and how this emerging technology affects consumers. Panelists will include consumer advocates, industry representatives, government regulators, technologists, and academics, and the workshop will be free and open to the public. Topics for discussion will be mobile payments technology, business models used in mobile payments, and the consumer protection and privacy issues that mobile payments raise. The experiences of other countries with mobile payments also will be discussed. The agenda is available here. More information about the workshop is available here.
• On May 30, 2012, the FTC will host a day-long, public “Dot Com Disclosures Workshop” addressing the need for new guidance for advertisers on appropriate disclosures for the online and mobile environment. The Workshop will concentrate on technological advancements and marketing developments that have emerged since the FTC first issued its online advertising disclosure guidelines known as “Dot Com Disclosures". Revisions will be consistent with the goals of the original guidelines, and will continue to emphasize that general consumer protection laws apply equally to online and mobile marketers. More information on the Workshop is available here.

Please contact Ross Buntrock, Alan Fishel, Stephanie Joyce, or Stephen Thompson (contact information below) for further information.

New Markets: Smart Grid and E-Health

• The U.S. Department of Energy (DOE) has announced a new “Apps for Energy” competition in partnership with PG&E, Itron, and Gridwise Alliance. The competition challenges application developers to use the Green Button data access program to make residential and commercial utility data more accessible and useful to the consumer. As part of DOE’s smart grid initiative, the Green Button program seeks to make energy usage data available in a streamlined and easy-to-understand format. The developers who submit the best apps will win part of a $100,000 cash prize, and submissions are due May 15, 2012 by 8:00 pm EST. Winners will be announced May 22, 2012. The official rules and deadlines are available here. More information regarding the Green Button initiative is available here.
• The Michigan Public Service Commission (MI PSC) has opened an investigation into the deployment of smart meters by electric utilities. Noting that consumers and municipalities have expressed concern about smart meters, the MI PSC ordered all regulated electric utilities to submit information to the MI PSC by March 16, 2012, on a number of issues, including (1) the utility’s existing plans for deployment of smart meters in its service territory, (2) any scientific information known to the utility that bears on the safety of smart meters, and (3) an explanation of the steps that the utility intends to take to safeguard the privacy of the information gathered. Comments are due April 16, 2012. The MI PSC order can be found here.

Please contact Stephanie Joyce, Jeffrey Rummel, G. David Carter, or Stephen Thompson (contact information below) for further information.

Developments in Intercarrier Compensation

• On April 10, 2012, the Florida Public Service Commission (FL PSC) granted the voluntary motion to dismiss of Qwest Communications Company, LLC d/b/a CenturyLink in its case against Lightyear Network Solutions, LLC after the parties reached a settlement agreement. Qwest filed its complaint in December 2009 against Lightyear and several other CLECs, including Verizon Access Transmission, XO Communications Services, Inc., and tw telecom of florida l.p., alleging that they had entered into discriminatory off-tariff access arrangements with several interexchange carriers but refused to provide the same rates to Qwest for similar access services. The CLEC defendants unsuccessfully moved to dismiss Qwest’s complaint last year, arguing that the FL PSC lacked subject matter jurisdiction as a result of legislation removing several matters from the FL PSC’s authority. Qwest’s complaint remains pending against the remaining CLECs. Docket No. 090538-TP.

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, Stephanie Joyce, or Adam Bowser (contact information below) for further information regarding intercarrier compensation matters.

Compliance Notes

• The Maryland Public Service Commission (MD PSC) has ordered all facilities-based Local Exchange Carriers (LECs) operating in Maryland to file reductions to their intrastate switched access rates in accordance with the Connect America Order (FCC 11-161) by May 1, 2012. These filings should bear an effective date of July 1, 2012. The MD PSC is also requiring facilities-based LECs to update their intrastate tariffs to reflect the implementation of the Connect America Order’s Internet-protocol (IP) traffic provisions by July 1, 2012. These provisions allow LECs to charge switched access charges for all IP-related traffic at interstate rates. The MD PSC warned that LECs that do not make these filings in a timely manner may be out of compliance and will not be allowed to charge for intrastate switched access until their revised tariff is approved by the MD PSC. A copy of the MD PSC notice can be found here. The Connect America Order may be found here.
• Form 499-Q is due May 1, 2012 for all filers that are not considered to be de minimis for Universal Service filing purposes. This filing encompasses historical revenues from the first quarter of 2012 and projected revenues for the third quarter of 2012. A copy of the current FCC Form 499-Q can be found here. Voice over Internet Protocol (VoIP) providers and Commercial Mobile Radio Service (CMRS) providers who rely on traffic studies to report interstate revenues on FCC Form 499-Q must submit these studies by May 1, 2012 to the Universal Service Administrative Company (USAC) and the Chief, Industry Analysis and Technology Division of the FCC.
• The Universal Service contribution factor for the second quarter of 2012 is 17.4%. A copy of the Public Notice announcing the rate can be found here. (DA-12-396).

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, or Katherine Barker Marshall (contact information below) for further information regarding compliance matters.

Broadband News

• Like AT&T and Verizon (see This Week in Telecom March 19 and April 2 editions), Sprint is also facing a shareholder vote on imposing net neutrality principles on its wireless network. Although stating that consumers are “well served by an open Internet,” Sprint opposes the proposal because it “would undermine Sprint’s ability to manage its network, ensure acceptable levels of performance for its customers, and develop new products and services.” The vote will take place May 15, 2012. Information on the proposal may be found here.
• On April 11, 2012, Calix, Inc. released a report on rural broadband entitled the “Calix U.S. Rural Broadband Report.” In the report, which studies data from October to December of 2011, Calix states that rural broadband is used most often for video streaming, composing 67 percent of downstream Internet traffic and 13 percent of upstream traffic in the studied networks. The report also finds that 5 percent of subscribers accounted for approximately 50 percent of Internet traffic. Calix plans to release an updated report every quarter. More information about the report may be found here.
• On April 2, 2012, the Internet Corporation for Assigned Names and Numbers (ICANN) announced April 30, 2012 as its target date to release the list of applications for new generic top-level domains (gTLDs) which will specify who has applied for which gTLDs. The application window closes April 12, 2012. If ICANN receives an “overwhelming number of applications,” it may postpone publication of the list of strings. ICANN’s announcement is available here.
• On April 4, 2012, the National Telecommunications and Information Administration (NTIA) requested comment on its proposal “to add 12 questions to the U.S. Census Bureau’s October 2012 Current Population Survey (CPS) in order to gather reliable data on broadband (also known as high-speed Internet) use by U.S. households.” The questions are intended to gauge progress on President Obama’s goal of universal, affordable broadband access for all Americans and to identify problem areas. Comments are due June 4, 2012. The Federal Register notice is available here.

Please contact Ross Buntrock, Alan Fishel, Michael Hazzard, Jeffrey Rummel, or Jason Koslofsky (contact information below) for further information.

In the Courts

• On April 5 and April 9, 2012, two mobile marketing companies filed putative class action antitrust lawsuits in the Southern District of New York against the country’s major wireless carriers, the CTIA trade association, and various text-message (or Short Message Service) aggregators. Plaintiffs, which send application-to-person (A2P) text messages on behalf of their customers, accuse the defendants of unlawfully preventing them from using normal 10-digit phone numbers to conduct their mobile marketing campaigns by instead creating and restricting such users to a system of 5- and 6-digit “common short codes,” or CSCs, for which the wireless carriers and Neustar then charged millions of dollars in fees above what would have been charged had they just been able to use 10-digit numbers. The plaintiffs allege that the wireless carriers “used their control of defendant CTIA ... to cause the CTIA to issue guidelines and rules calling for the use of five-digit (and later six-digit) CSCs for transmission of A2P SMS, inhibiting the use of standard ten-digit numbers for transmission of A2P SMS, and imposing volume limits on text messages sent from ten-digit numbers.” They further allege that the “establishment of the CSC system, which generates approximately $2.3 billion in revenues annually and continues to this day, has permitted the defendants and co-conspirator Neustar to jointly control and anti-competitively exploit the transmission of A2P SMS and to eliminate the lower-priced ten-digit telephone number alternative for use in A2P SMS transmission.” The plaintiffs, whose suits are likely to be consolidated, seek class certification, injunctive relief, treble damages, and attorneys’ fees under Sections 1 and 2 of the Sherman Act. Club Texting, Inc. v. Cellco P’ship d/b/a Verizon Wireless, No. 12-cv-2656 (S.D.N.Y.); TextPower, Inc. v. Cellco P’ship d/b/a Verizon Wireless, No. 12-cv-2729 (S.D.N.Y.).

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, Stephanie Joyce, or Joseph Bowser (contact information below) for further information.

Legislative Outlook

• Congress is in recess. The House and the Senate are scheduled to return April 16, 2012.

Please contact Stephanie Joyce (contact information below) for further information.

Upcoming Events

• Jeffrey Rummel, a Partner in our Group, will give a speech titled “FCC Licensing/Regulation of the Manufacture, Development & Testing of Military Communications Systems” at the Military Wireless Conference to be held May 15-17, 2012, at the Sheraton National Hotel in Arlington, VA. For more information, click here.
• The FCBA Annual Conference will be held May 4-6, 2012, at the Hyatt Regency Chesapeake Bay. For more information, click here.

Please contact Jeffrey Rummel, Jonathan Canis, or Stephanie Joyce (contact information below) for further information.

For further information, please contact any of our attorneys in the Arent Fox Telecommunications Group.