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.

Federal Communications Commission (FCC) Announcements

• The FCC has released the Tentative Agenda for its next meeting to the held May 12, 2011. It contains three items: a Notice of Proposed Rulemaking seeking comment on outage reporting requirements for Voice-over-Internet-Protocol (VoIP) service; a Notice of Proposed Rulemaking on whether to eliminate the international settlements regime; and the First Report and Order on streamlining international data reporting requirements, with a Further Notice of Proposed Rulemaking. To view the Public Notice, click here.
• AT&T and T-Mobile filed their application for transfer of control on April 21, 2011. The FCC has not yet set the comment cycle but is accepting ex parte presentations. Requests for meetings must be submitted online using an ex parte request form. To view the Public Notice, click here.
• The next FCC workshop on Universal Service and Intercarrier Compensation reform will be held April 27, 2011, at 9:30 am Eastern. It will take place in the Commission’s Meeting Room located at 445 12th Street, SW, Washington DC 20554. The focus will be the Connect America Fund (CAF). For further information, click here.
• Comments on the Notice of Proposed Rulemaking (NPRM) adopted by the FCC on February 8, 2011, regarding reform of the Universal Service fund (USF) and the intercarrier compensation (ICC) system are as follows:
  
  Reply Comments on all portions of the NPRM except Section XV are due May 23, 2011.
  
  Comments on the FCC’s proposed collection requirements under the Paperwork Reduction Act are due May 2, 2011.
• On April 11, 2011, the FCC released a Public Notice regarding consumers’ “need for speed” information on broadband. Noting that the lack of consumer understanding of broadband speed may affect subscribership, the FCC is seeking comment on what kind of speed data to collect and how to present it to consumers. Comments are due May 26, 2011, and Reply Comments are due June 16, 2011. The Public Notice is available here.
• Reply Comments on the Notice of Proposed Rulemaking to implement the Truth in Caller ID Act, Pub. L. No. 111-331, codified at 47 U.S.C. § 227(e), are due May 3, 2011. WC Docket No. 11-39. To read our Alert on this item, click here. To view the NPRM, click here.

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

Federal Trade Commission (FTC) Developments

• On April 21, 2011, the FTC announced that Electric Mobility Corp. (EMC), the maker of Rascal Scooters, will pay a $100,000 fine to settle the agency’s complaint against it for violations of the Do Not Call Rules. The complaint alleges that EMC used phone numbers gathered from sweepstakes entry forms to contact consumers whose numbers are on the Do Not Call Registry. The FTC’s Telemarketing Sales Rules allow a company to call a consumer on the Do Not Call Registry for up to 18 months if the company has an “established business relationship” with the consumer and the consumer has not asked the firm to stop calling. A completed sweepstakes entry is insufficient to establish a business relationship with a consumer. The settlement agreement states that EMC is subject to a larger fine of $2 million, but that fine is suspended based on its inability to pay. United States v. Electric Mobility Corp., Case No. 1:11-cv-02218 (D.N.J., filed Apr. 19, 2011); FTC File No. 062-3132.
• The FTC will host a forum on May 11, 2011, in Washington, DC, to examine how the government, businesses, and consumer protection organizations can work together to prevent consumers from receiving unauthorized third-party charges on their phone bills — a practice known as “cramming”. The forum, which will be held at the FTC’s satellite building conference center, will be open to the public. The FTC invites interested parties to submit comments on cramming prevention through the FTC’s online comment form no later than April 27, 2011. The FTC’s Press Release on the Cramming Forum can be found here. Comments can be submitted to the FTC here.

Please contact Ross Buntrock, Alan Fishel, Stephanie Joyce, or J. Isaac Himowitz (contact information below) for further information.

Developments in Intercarrier Compensation

• On April 20, 2011, Capital Infrastructure LLC d/b/a Connexion Technologies, and Broadstar LLC d/b/a/ Primecast filed separate petitions for reconsideration of an Iowa Utilities Board order finding that the companies provided non-nomadic VoIP service and are therefore public utilities under Iowa law. The order stems from a complaint proceeding in which MCC Telephony of Iowa LLC and MCC Iowa LLC d/b/a Mediacom alleged that Connexion entered into exclusive service contracts with the owners of certain multiple dwelling units and demanded that Mediacom stop providing service to those properties. Connexion argued that because it did not have a direct contractual relationship with the tenants of the properties, it did not treat these tenants as end users and therefore could not be deemed a public utility. The Board, however, ruled that a public utility need not have a direct relationship with a customer to be considered a utility under Iowa law, and ruled that Connexion and Primecast must obtain a certificate of public convenience and necessity (CPCN) to provide their VoIP service within the state. Primecast argued that it provides nomadic VoIP service, and that the FCC has preempted state regulation of this service, and thus the Board lacks authority to require Primecast to obtain a CPCN. Primecast requested that the Board stay its decision while the petitions are pending, and stated that it “stands firm in its position that its nomadic VoIP service is an information service not subject to Board jurisdiction.” Docket No. FCU-2010-0015.

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

• FCC Form 499-Q is due May 1, 2011 for all filers that are not considered to be de minimis for Universal Service filing purposes. Carrier must report historical revenues from the first quarter of 2011 and projected revenues for the third quarter of 2011. A copy of the current FCC Form 499-Q can be found here.
• Detariffed, non-dominant providers of interstate interexchange telecommunications services are required to file their Annual Geographic Rate Averaging Certification on or before May 1, 2011. 47 CFR Section 64.1900. In this filing, providers must certify that their rates in high-cost and rural areas are not higher than their rates in urban areas as required by 47 USC Section 254(g). An officer must sign the certification under oath. Certifications must be filed with the Secretary of the FCC, and addressed to the attention of Chief of the Pricing Policy Bureau.
• The Universal Service contribution factor for the second quarter of 2011 is 14.9%. A copy of the notice can be found here.

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

Stimulus This Week

• On April 20, 2011, US Department of Agriculture (USDA) Secretary Tom Vilsack announced almost $40 million in loans for projects in Georgia, Illinois, Iowa, Kansas, North Dakota, Montana, and Oklahoma for Fiber to the Premises (FTTP) projects under the USDA’s broadband loan programs. The projects will result in more than 1,000 miles of FTTP networks. Funding for each project is contingent upon the recipient meeting the terms of the loan agreement. More information about the projects may be found here.
• The Rural Utilities Service (RUS) is accepting applications for broadband access loans. These loans will be funded by the Food, Conservation, and Energy Act of 2008, commonly known as the 2008 Farm Bill. RUS currently estimates that $700 million may be available from prior appropriations, but this figure may change based upon ultimate resolution of the federal budget. RUS plans to publish a subsequent notice that will identify the amount of funding available upon the enactment of the 2011 Appropriations Act. It has stated that “expenses incurred in developing the application will be at the applicant’s own risk.” The minimum loan amount is $100,000 and the maximum is $100 million. A copy of the Federal Register notice regarding the loans, published on March 14, 2011, can be found here.
• Also on March 10, RUS announced interim rules that reflect changes in its broadband loan programs as a result of the 2008 Farm Bill. They became effective March 13, 2011. RUS is seeking comment on these interim rules on issues relating to priority of applications, application requirements, notice requirements, methods of determining which applicants should be eligible for a 4% interest rate, and application processing. Comments are due May 13, 2011. A copy of the Federal Register notice, published on March 14, 2011, can be found here.
• Quarterly financial reports and Performance Progress Reports (PPR) for Broadband Technology Opportunities Program (BTOP) grant recipients are due April 30, 2011 for the first quarter of 2011.
  
  The instructions for filing the financial reports can be found here.
  
  The form for the financial reports can be found here. 
  
  The quarterly Performance Progress Reports for Broadband Sustainability Projects can be found here.
  
  The quarterly Performance Progress Reports for projects involving Public Computer Centers can be found here.
  
  The quarterly Performance Progress Reports for Broadband Infrastructure Projects can be found here. 
• The American Recovery and Reinvestment Act (ARRA), which provided the funding to NTIA, requires BTOP recipients to file quarterly status and compensation reports no later than 10 days after the close of a quarter. These reports must be filed at www.federalreporting.gov.

Please contact Ross Buntrock, Jon Canis, Alan Fishel, Jeffrey Rummel, or Katherine Barker Marshall (contact information below) for further information regarding stimulus funding.

Broadband News

• On April 20, 2011, Commissioner Clyburn spoke at the Internet2 Spring Member Meeting in Arlington, VA. Commissioner Clyburn praised Internet2 for “promoting three policy initiatives that are particularly important to me – accessibility, affordability, and adoption.” She also praised Internet2 for its commitment to Open Internet principles and commended Internet2 for its BTOP award to develop a comprehensive 50-state network benefiting approximately 121,000 community anchors. The text of the speech is available here.
• Also on April 20, Chairman Genachowski spoke at a luncheon sponsored by The Economic Club of Washington, DC, and predicted that TV broadcasters will participate in spectrum incentive auctions if Congress authorizes such auctions. He emphasized that incentive auctions are critical to freeing up significant spectrum to meet the nation’s increasing spectrum needs.
• The FCC and the John S. and James L. Knight Foundation announced a nationwide contest to develop an application that “seeks to take advantage of the local, public information coming online – on topics from education to health care, child care, government services and jobs – and … turn that information into content, apps and services that expand people’s choices on critical issues.” As an example, the announcement mentioned apps that could “give people valuable information about their communities in an easily digestible graphic on their mobile devices; help seniors, immigrants, and others use tools such as Skype to communicate; allow consumers to choose a health care provider; or deliver contract and seasonal job post alerts in English and Spanish via text message.” The Knight Foundation is offering $100,000 in prizes. More details may be found here.
• The submission deadline for the FCC Open Internet Challenge is June 1, 2011. The FCC seeks ideas for monitoring Internet providers’ compliance with the Open Internet rules. The winner will get a trip to Washington, DC and will be honored at an FCC Chairman’s reception. More information can be found here.

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

Telecom Privacy News

• The Obama administration recently unveiled its National Strategy for Trusted Identities In Cyberspace (NSTIC), a regulatory framework that will encourage the private sector to create a more secure Internet identity ecosystem aimed at reducing online fraud and theft. The proposal will establish standards for online identity authentication that will allow consumers to create, through private sector companies, a single online identity for all online transactions. According to the administration, businesses will benefit from the system by being able to more easily do business online without the costs of building secure log-in systems. Commerce Secretary Gary Locke stated, “We must do more to help consumers protect themselves, and we must make it more convenient than remembering dozens of passwords.” The National Institute of Standards and Technology will oversee the implementation of NSTIC. It is scheduled to hold a series of workshops later this year to get input on privacy and interoperability issues.
• Researchers Alasdair Allan and Pete Warden revealed this past week that Apple devices such as the iPhone or 3G iPad track their users. The devices log an individual’s location data in a file called ‘consolidated.db’ with latitude and longitude coordinates and a timestamp. This tracking capability appears to be associated with the launch of iOS 4 last June, meaning that many users now have had their locations tracked for nearly a year. According to their findings, Apple triangulates an individual’s location from cell phone towers and logs that information in order to help get a faster GPS lock. It is this triangulation data that is being logged even if the user is not using the built-in GPS application and, according to the report, is done without the user’s knowledge or consent. “As far as we can tell, the location is determined by triangulating against the nearest cell-phone towers. This isn’t as accurate as GPS, but presumably takes less power,” they wrote. Of additional concern is that the location files are stored unencrypted on the iPhone or iPad and also copied to any computer the device is syncs with. Thus, individuals who access the device or computer can see this information and know precisely where the individual has been at any time since they purchased the Apple device. “By passively logging your location without your permission, Apple have made it possible for anyone from a jealous spouse to a private investigator to get a detailed picture of your movements,” the team wrote. The pair have created and released an application that enables users to view the location files stored in their devices, available here.

Please contact Ross Buntrock, Jon Canis, Alan Fishel, Michael Hazzard, Jeffrey Rummel, or G. David Carter (contact information below) for further information.

In the Courts

• On April 19, 2011, the US District Court for the District of New Hampshire denied AT&T Mobility’s appeal from the Town of Candia’s denial of a for a variance to build a 120-foot or 150-foot monopole tower. The Town had granted AT&T permission to build a 100-foot tower, but AT&T found that insufficient. The court first had to resolve a burden-of-proof issue regarding wireless carriers’ challenges to denials of variance petitions: “to the extent AT&T argues that the Board bears the burden of demonstrating that its decision was supported by substantial evidence … it is quite mistaken. The law in this Circuit is clear: under the TCA, AT&T bears the burden of proving that the Board’s denials with respect to towers of 115 and 150 feet ‘lack adequate evidentiary support in the record.’” The court then concluded that AT&T failed to meet its burden: the “setback requirement of concern to the Board addresses safety issues, and the record does not suggest that those concerns must be compromised, and a variance allowed, to accommodate an otherwise unavoidable coverage gap.” New Cingular Wireless PCS, LLC v. Town of Candia, 09-cv-387-SM (D.N.H.).
• On April 18, 2011, the US District Court for the Eastern District of Missouri streamlined the nationwide class action against AT&T Missouri by dismissing two of that company’s affiliates: AT&T, Inc. and American Telephone & Telegraph Company. The suit seeks relief from allegedly unlawful and fraudulent third-party billing practices. In their motion to dismiss, those AT&T entities stated that they provide no services and have no employees or offices in Missouri. “There is nothing before the court which demonstrates that these defendants have transacted any business in the State of Missouri. Furthermore, there is nothing before the Court which demonstrates that these defendants committed a tort in Missouri,” the court concluded. The case will proceed against the remaining AT&T entities. Arnold v. AT&T, Inc., No. 4:10-cv-2429 (E.D. Mo.).

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

Legislative Outlook

• Both the House and the Senate are on recess through May 2, 2011.

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

Upcoming Events

• The FCBA’s 2011 Annual Seminar takes place this week, April 29-May 1, 2011, at the Nemacolin Woodlands Resort in Farmington, PA. For more information or to register, click here.
• On May 11, 2011, Chairman Julius Genachowski will speak at an event sponsored by Bisnow titled “The Future of Mobile Broadband.” This event will be moderated by Arent Fox Partner Ross Buntrock and will take place at the Renaissance Hotel in Washington DC. For more information or to register, click here.
• The Telecommunications Industry Association’s Spring Policy Summit, “TIA 2011: Inside the Network,” will be held May 17-20, 2011, at the Gaylord Texan Hotel in Dallas. For more information or to register, click here.
• The FCBA will hold its Spring Reception on May 24, 2011, at the Washington Hilton Hotel, 1919 Connecticut Avenue NW, from 6:00-8:00 pm Eastern. For more information or to register, click here.

Please contact Stephanie Joyce or Marcia Durkin (contact information below) for further information.

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