[Federal Register: December 29, 2004 (Volume 69, Number 249)]
[Rules and Regulations]
[Page 77912-77938]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29de04-11]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 1, 20, and 43
[WC Docket No. 04-141; FCC 04-266]
Local Telephone Competition and Broadband Reporting
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Federal Communications Commission
extends and modifies the FCC Form 477 local competition and broadband
data gathering program, established by the Commission's Data Gathering
Order published Wednesday, April 12, 2000, 65 FR 19675.
DATES: The rules in this document contain information collection
requirements that have not been approved by OMB. The Federal
Communications Commission will publish a document in the Federal
Register announcing the effective date.
Compliance date: September 1, 2005. Providers subject to the
requirements and regulations adopted herein shall complete and file the
amended FCC Form 477 on the compliance date and semiannually
thereafter.
FOR FURTHER INFORMATION CONTACT: Ellen Burton, Assistant Chief, James
Eisner, Senior Economist, or Thomas J. Beers, Deputy Chief, Industry
Analysis and Technology Division, Wireline Competition Bureau, at (202)
418-0940. For additional information concerning the information
collection(s) contained in this document, contact Judith B. Herman at
(202) 418-0214, or via the Internet at Judith-B.Herman@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order (Order) in WC Docket No. 04-141, adopted on November 9, 2004,
and released on November 12, 2004. The full text of this document is
available on the Commission's Web site Electronic Comment Filing System
and for public inspection Monday through Thursday from 8 a.m. to 4:30
p.m. and Friday from 8 a.m. to 11:30 a.m. in the FCC Reference Center,
Room CY-A257, 445 Twelfth Street, SW., Washington, DC 20554.
Alternative formats are available to persons with disabilities by
contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365. The
full text of the NPRM may also be purchased from the Commission's
duplicating contractor, Best Copy and Printing, Inc., Room CY-B402, 445
Twelfth Street, SW., Washington, DC 20554, telephone (202) 488-5300,
facsimile (202) 488-5563, or through http://www.bcpiweb.com.
Paperwork Reduction Act
This Order contains modified information collection requirements
subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-
13. It will be submitted to OMB for review under section 3507(d) of the
PRA.
Summary of the Report and Order
1. In this Order, we adopt rules and a standardized form to improve
our Form 477 local competition and broadband data gathering program,
including extending the program for five years beyond its currently
designated sunset in March 2005, eliminating existing reporting
thresholds, and gathering more granular data from service providers.
The information collected in the Form 477 program helps the Commission
and the public understand the extent of local telephone competition and
broadband deployment, which is important to the nation's economic,
educational, and social well-being. The improvements we adopt here,
which include some but not all of the modifications proposed in our
recent Data Collection NPRM, are necessary to ensure that the
Commission can continue to effectively evaluate broadband and local
competition developments as they affect all Americans. At the same
time, we have acted to minimize, wherever possible, the administrative
burdens imposed on reporting entities by the modified Form 477 program.
2. The Data Gathering Order established a reporting program (using
the FCC Form 477) to collect basic information about two critical areas
of the communications industry: the deployment of broadband services
and the development of local telephone service competition. The
Commission concluded that collecting this information would materially
improve its ability to develop, evaluate, and revise policy in these
rapidly changing areas and provide valuable benchmarks for Congress,
the Commission, other policy makers, and consumers. Since adoption of
the Form 477 in 2000, broadband service providers and local telephone
service providers have reported data ten times, and we have issued
regular reports based in significant part on this information. In the
Data Gathering Order, the Commission adopted a sunset provision
pursuant to which the collection program terminates after five years
(i.e., in March 2005) unless the Commission acts to extend it.
3. Form 477 includes separate sections on broadband deployment,
local telephone service competition, and mobile telephone service
provision. In the Data Gathering Order, the Commission required
entities to report only when they meet or exceed defined reporting
thresholds, and, then, to complete only those portions of the form for
which they meet or exceed the reporting thresholds. The Commission
required entities that meet a threshold to file data on a state-by-
state basis. The Commission also required facilities-based providers of
broadband connections and local exchange carriers (LECs) to report
lists of the Zip Codes in which they serve end users, for each state
for which they complete a form. In the case of broadband connections,
reporting entities include incumbent and competitive LECs, cable
companies, operators of terrestrial and satellite wireless facilities,
municipalities, and any other facilities-based provider of broadband
connections to end users.
4. In the Data Collection NPRM, we proposed to: (1) Extend the data
collection for an additional five years; (2) modify Form 477 to collect
more-detailed information about broadband connection speeds and the
localized deployment of broadband technologies; (3) collect information
about subscribership to bundled local and interstate long distance
telephone services; and (4) eliminate or revise those local telephone
service questions that elicit imprecise or infrequently used
information. We also invited comment on whether we should eliminate or
lower the current reporting thresholds; modify our policies for
publishing or sharing Form 477 data; require filers to categorize
broadband connections according to the information transfer rates
observed by end users; and require filers to report numbers of
broadband connections in service by Zip Code or technology, or,
alternatively, by Zip Code, technology, and speed.
5. We have considered the record of this proceeding, including
comment about reporting burdens associated with current Form 477
reporting requirements, potential burdens associated with additional
reporting requirements proposed or otherwise noticed for discussion in
the Data Collection NPRM, and potential burdens associated with
alternatives suggested by the parties, as well as our experience with
the Form 477 to date. As discussed below, in this Order we: (1) Extend
the Form 477 program for five years beyond
[[Page 77913]]
its currently designated sunset in March 2005; (2) eliminate reporting
thresholds; and (3) adopt various modifications to the Form 477.
6. Five-Year Extension. We conclude that it is reasonable to extend
the Form 477 program for five years beyond the current March 2005
sunset given our statutory obligations to study and report on the
availability of broadband capability, as well as our continuing
obligations to promote telecommunications services competition
generally. We conclude that extending the Form 477 program for an
additional five years with the modifications discussed below will
materially improve the Commission's ability to develop, evaluate, and
revise policy in the rapidly changing areas of broadband deployment and
local telephone competition, and provide valuable benchmarks for
Congress, the Commission, other policy makers, and consumers. As
discussed in more detail in the following sections and in the Final
Regulatory Flexibility Analysis attached to this Order, we also
conclude that extending the Form 477, as modified, will not impose an
undue burden on the entities that are required to report. In this
regard, we have taken or will take the following steps to reduce
associated burdens: (1) We decline to adopt certain modifications to
the Form 477 proposed in the Data Collection NPRM, including the
proposed requirement that filers categorize broadband connections
according to the information transfer rate (speed) actually observed by
the end user; (2) we eliminate various questions from the wireline
local telephone section of the form; (3) we eliminate the requirement
that filers seeking confidential treatment of Form 477 data prepare and
submit a separate, redacted Form 477; (4) responding to comments
submitted by the Office of Advocacy of the Small Business
Administration, we will publish a Small Entity Compliance Guide to
provide a set of user-friendly explanations to direct small entities to
those sections of the Form 477 relevant to their operations.
7. We reject calls for extending the Form 477 program for less than
five years because our statutory responsibilities to study and report
on broadband deployment and encourage the development of local
telephone service competition are on-going. We find that a five-year
extension is prudent given continuing and rapidly-evolving developments
in broadband and local telephone services markets. Reviewing the
adequacy of our form at regular intervals is essential to ensure that
it is, in fact, capturing the most relevant and critical information
given the dynamic nature of these markets. Accordingly, we affirm our
analysis and conclusion in the Data Gathering Order, namely, that a
five-year program best balances our continuing need to understand
evolving market developments against our desire to minimize costs and
ensure that adopted regulation does not outlive its usefulness.
Moreover, we disagree with comments that the availability of
alternative data sources is an adequate substitute for the Form 477. In
our experience, most if not all commercially available studies of
residential services adoption derive their data in significant part
from the Commission's Form 477-based public reports. And, no nationwide
studies of broadband deployment or of local telephone competition are
based on better sources of data for rural and other hard-to-serve
areas. Voluntary membership surveys conducted by commenters NTCA and
OPASTCO, and also by the National Exchange Carrier Association (NECA),
provide welcome evidence that the incumbent LECs that respond to the
surveys are deploying broadband services to substantial--and
increasing-- percentages of their customer base. Entities that choose
not to participate in these voluntary surveys may have a different
experience. By contrast, surveys such as those about Internet use
conducted by the Pew Internet & American Life Project, and the Census
Bureau's Current Population Survey, use random samples that are
constructed to avoid overlooking particular population groups. To
obtain statistically significant results for particular rural
populations, however, a large (and therefore expensive) random sample
is required. For example, because the random sample (of about 57,000
households) for the Current Population Survey does not over-sample
households located in rural areas in particular states, the Department
of Commerce was able to discuss nationwide differences between rural
and urban households in its report, A Nation Online: How Americans Are
Expanding Their Use of the Internet (February 2002), but was not able
to discuss such differences within particular states. Similarly, the
Pew Internet & American Life Project has compared only nationwide
differences in Internet use by residents of rural and urban areas on
the basis of random samples of about 20,000 Americans age 18 and older.
8. Elimination of Reporting Thresholds. We also modify the Form 477
program to require all facilities-based providers of broadband
connections to end users to report broadband data, all local exchange
carriers to report local telephone service data, and all mobile
telephone carriers to report mobile telephone data. In reaching this
conclusion, we note that comments from state agencies, and from some
service providers, generally supported eliminating, or substantially
reducing, the reporting thresholds. As we stated in the Data Collection
NPRM, we believe that the current data collection misses several
hundred small facilities-based broadband providers, e.g., rural
incumbent LECs, wireless Internet service providers, and
municipalities. Moreover, we agree with those commenters who argue that
it is important to capture a more accurate picture of broadband
deployment and local telephone competition in rural, sparsely populated
areas, which are more likely to be served by small carriers.
9. In reaching our conclusion, we recognize that in the Data
Gathering Order the Commission concluded that a reporting threshold for
broadband and local competition appropriately balanced its need for an
inclusive reporting requirement against the burdens imposed on small
entities. At the same time, the Commission stated ``[we] are committed
to revising these thresholds (either upward or downward) should it be
necessary based either on our experience or on changes in the relevant
markets.'' And, the Commission pointed out that ``[by] excluding any
providers we necessarily face the possibility of understating the
amount of competitive activity and broadband deployment in smaller,
rural areas.'' Based on our experience with the Form 477 over the past
nearly five years, we now conclude that the current thresholds render
impossible a thorough understanding of the dynamics of broadband
deployment in states with rural and/or underserved areas. We find that
lowering the existing thresholds to some other, more or less arbitrary,
number means that certain of these areas will continue to elude our
scrutiny. Such a result seems inimical to Congress's charge, in section
706 of the Act, that we make determinations on the ``availability of
advanced telecommunications capability to all Americans.'' Thus, we
believe that are better equipped to make sound policy determinations
affecting the broadband market to the extent we have the most accurate
and comprehensive data possible upon which to base our decisions.
[[Page 77914]]
10. Similarly, based on our extensive experience in collection
local competition data, we now conclude that we must gather an
appropriate amount of information about the status of local competition
from all areas of the country. We believe that the current 10,000 line
reporting threshold significantly understates the amount of local
competition in states that include rural and/or other underserved
areas. As a result, our understanding of rural and underserved market
development is not as precise as it could be. Having more accurate
information about competition in rural markets will assist the
Commission in its review of portability and eligibility policies.
Merely lowering existing thresholds to some arbitrary number does not
overcome this problem or mitigate its effects.
11. Moreover, this problem predictably will only get worse as
networks continue to evolve, i.e., as network architectures reflect the
continued convergence of traditional telephony and broadband. Given
such convergence, which was only at its initial stages when we adopted
the Data Gathering Order almost five years ago, it becomes essential
that our broadband and local competition data collection methodologies
are equally comprehensive. We therefore conclude that we should collect
local telephone service information on the same comprehensive basis
upon which we collect information about broadband connections.
12. We conclude that the benefits to the policy making process that
derive from the additional data outweigh the reporting burdens on new
Form 477 filers (i.e., entities that would not be required to file Form
477 if we retained the current mandatory reporting thresholds). As we
noted in the Data Collection NPRM, the small facilities-based broadband
providers that currently file Form 477 on a voluntary basis find that
only a few questions apply to their situations. Moreover, among the
smaller entities that are currently required to report broadband data
on Form 477 (i.e., entities that report between 250 and 499 broadband
connections in a state), 68 percent reported connections in only one
technology category, and 98 percent reported connections in two or
fewer technology categories. Accordingly, we conclude that the
broadband reporting requirements we adopt here are not overly
burdensome for small providers. Similarly, among the smaller incumbent
LECs that are currently required to report wireline local telephone
data (i.e., carriers that report between 10,000 and 24,999 voice-grade
equivalent local exchange lines), 95 percent report only one of the
five rows of information that will appear in the modified form.
Therefore, we conclude that the local telephone reporting requirements
we adopt here are not overly burdensome for small carriers. We also
note that, for many new incumbent LEC filers, some answers (e.g.,
percent of local exchange lines provided over the filer's own local
loops) are unlikely to change from filing to filing, and that, more
generally, filers will be able to complete their filings more
efficiently as they gain experience with the data collection. We
conclude that it is not possible to develop an adequately comprehensive
picture of broadband deployment and local telephone competition in the
United States without including information about the situation in
rural, sparsely populated areas. As NECA emphasizes, the more than
1,100 rural carriers that belong to NECA's Traffic Sensitive pool
generally serve sparse populations over wide geographical areas--
frequently fewer than 10 customers per square mile. Therefore, we
conclude that the benefits to policy making of developing a more
accurate picture of broadband deployment and local telephone
competition--including in rural, sparsely populated areas--outweigh the
costs of reporting that we impose on carriers that have previously been
exempt from filing Form 477.
13. We recognize, however, the particular concerns about reporting
burden that have been raised by smaller incumbent LECs, and we
consequently decide not to pursue at this time certain options about
which we requested comment in the Data Collection NPRM. In particular,
we decide not to require filers to determine what information transfer
rate an end user actually observes on his or her broadband connection,
and, as discussed below, we also decide to eliminate from the form
several questions about local telephone service.
14. Broadband Data. Based on our review of the record in this
proceeding and on our experience with the Form 477, we adopt a number
of modifications to the broadband data collected by the Form 477. We
conclude that these modifications are necessary to ensure that we have
a full picture of developing broadband deployment trends nationwide.
First, we modify the Form 477 to require filers to determine what
percentage of their broadband or high-speed connections are faster than
200 kbps in both directions, and to categorize these connections into
five ``speed tiers'' based on the information transfer rate in the
connection's faster direction: (1) Greater than 200 kbps and less than
2.5 megabits per second (mbps); (2) greater than or equal to 2.5 mbps
and less than 10 mbps; (3) greater than or equal to 10 mbps and less
than 25 mbps; (4) greater than or equal to 25 mbps and less than 100
mbps; and (5) greater than or equal to 100 mbps. Some comments in this
proceeding assert that collecting information about connections with
very high speeds (e.g., above 10 mbps) would be irrelevant (e.g.,
because connections operating at such speeds are now not generally
available to consumers in the United States). As we noted in the Fourth
706 Report, however, we have observed some service providers offering
faster and faster connections, perhaps because they are able to do so
at relatively little cost, and thereby differentiate their products
from competitors' slower services. As these faster services are
introduced, it is vitally important that we understand the evolving
dynamics of higher speed broadband availability in order to fulfill our
statutory responsibilities to report about whether broadband capability
is available to all Americans.
15. We also modify Form 477 to require filers to report symmetric
xDSL broadband connections separately from traditional wireline (such
as T-carrier) connections, and to separately report broadband
connections delivered over electric power lines. Thus, we require
filers to report broadband connections in the following technology
categories: asymmetric xDSL, symmetric xDSL, traditional wireline (such
as T-carrier), cable modem, optical carrier (fiber to the end user),
satellite, terrestrial fixed wireless, terrestrial mobile wireless,
electric power line, or ``all other.'' In contrast to asymmetric xDSL,
symmetric xDSL is well-suited to applications, such as
videoconferencing, that require high-speed capacity in the upstream
path as well as the downstream path. When Form 477 was implemented, it
was the Commission's understanding that symmetric xDSL service was
being deployed and marketed principally to businesses, as a substitute
for the more traditional T-carrier services, and the Commission
therefore specified that symmetric xDSL connections should be reported
along with connections over ``other traditional wireline''
technologies. We now observe that some symmetric xDSL services are
being offered to residential end users. For example, while we note that
information about a broad range of symmetric high-speed xDSL services
appears in marketing materials, such as Web pages, that are directed to
business customers, we also observe that some
[[Page 77915]]
relatively low priced symmetric xDSL connections are being advertised
on Web pages identified specifically for residential customers. We
therefore disagree with comments that it is unnecessary or meaningless
to distinguish symmetric xDSL services from traditional wireline
services in the data collection. We also decide to establish electric
power line as a separate broadband technology category to enable us to
monitor its deployment specifically.
16. Additionally, we modify Form 477 to require incumbent LECs that
report DSL connections (or whose affiliates report DSL connections) to
report the extent to which DSL connections are available to the
residential end user premises to which the incumbent LEC offers local
telephone service. Similarly, we modify Form 477 to require cable
system operators that report cable modem connections (or whose
affiliates report cable modem connections) to report the extent to
which cable modem connections are available to the residential end user
premises to which the cable system offers cable television service. We
adopt these requirements in order to obtain state-level
``availability'' estimates from the major providers of the broadband
services with the greatest residential acceptance in the United States
to date, to better enable us to monitor the extent to which these
broadband platforms are available to all Americans, and to ascertain
with more precision the pattern of competition between these platforms.
17. In response to commenter concerns, we modify the availability
metric that we proposed in the Data Collection NPRM to conform more
closely with the system-wide metrics with which cable system operators
are generally familiar. By relying as much as possible on such industry
practices, we believe that we can collect, in a minimally burdensome
manner, more-detailed information about the extent to which the widely
deployed and widely utilized cable modem and DSL infrastructures are
available to potential residential end users in a minimally burdensome
manner. We note that residential broadband connections in service in
the United States are primarily cable modem or DSL connections. Because
of the relatively small numbers of residential subscribers to broadband
services that are provided by means of satellite, fixed wireless,
mobile wireless, optical carrier, and other technologies, at this time,
we do not require providers of those services to report availability
estimates. We may, however, propose to do so in the future if
circumstances warrant.
18. We also modify Form 477 to require all filers that report
information about wired or fixed wireless broadband connections to end
user locations to report technology-specific lists of the Zip Codes in
which at least one such connection is in service. Specifically, we
require separate such lists for connections provided by mean of
asymmetric xDSL, symmetric xDSL, cable modem, optical carrier (fiber to
the end user), satellite, terrestrial fixed wireless, electric power
line, and (as a single category) other wireline technologies. With
respect to mobile wireless broadband services, which are now beginning
to be deployed commercially, we note that the end user of such a
service must be within a broadband service coverage area to make use of
the service, but may move around within and among coverage areas.
Particularly during the initial stages of commercial deployment,
moreover, there may be a mismatch between the billing addresses of some
early-adopter subscribers, such as persons who travel frequently on
business, and the physical locations where the subscriber can actually
use the service. Because of the particular characteristics of mobile
services, some have argued that CMRS providers should be completely
exempt from reporting broadband data on Form 477. We disagree. Rather,
we acknowledge that mobile broadband services differ in particular
respects from fixed broadband services and make provision for such
differences in this data collection. In particular, we specify that
mobile wireless service providers will report the number of subscribers
to their mobile wireless broadband services. And, we require, at this
time, that filers reporting mobile wireless broadband subscribers on
Form 477 also provide a list of Zip Codes that best represent the
filer's mobile wireless broadband coverage areas. We observe mobile
wireless broadband service providers using Zip Code-based information
in their own marketing initiatives, and we conclude that providing such
information on Form 477 will not be overly burdensome.
19. Finally, we note that various commenters argued that the
Commission did not adequately identify and justify the need for the
broadband (and local competition) reporting modifications proposed in
the Data Collection NPRM. We disagree. In the Data Collection NPRM, we
carefully noted justifications for gathering information about
broadband deployment and local telephone competition in the Form 477.
We also stated that additional information ``would be extremely
useful'' in identifying and tracking relevant developments,
particularly in rural areas. Moreover, in the context of broadband
deployment, we specifically noted ``the emergence of competing
platforms to deliver high-speed services, increasing data speeds of
services offered, and a steady improvement in mass-market acceptance of
services.'' Our discussion of changes to the current Form 477 was
clearly tied to these observations, as well as to the Commission's
experience with the Form 477. We have carefully reviewed the record
developed in response to these proposals, and find that it supports
extending the Form 477 program with the modifications adopted in this
Order. We also draw attention to the Commission's statements in its
most recent Report to Congress, pursuant to section 706 of the 1996
Act, regarding the availability of broadband services in the United
States. In that Report, the Commission affirmed the need to track
broadband deployment in sparsely served, rural areas, as well as the
need to better track the developing consumer appetite for broadband
services at speeds well in excess of the Commission's current minimum
200 kbps speed. We find that all of the Form 477 modifications proposed
in the Data Collection NPRM and adopted here derive from these two
basic concerns, as well as from regulatory mandates imposed by section
706 of the Telecommunications Act of 1996 and, more generally, by the
Communications Act.
20. Local Telephone Data. Based on our review of the record in this
proceeding and our experience with the Form 477, we adopt far fewer
modifications to the local telephone data reported on the form. In
fact, we adopt only two. First, we modify Form 477 to require LECs to
report the extent to which they are also the end user's default
interstate long distance carrier. We disagree with those commenters
that argued such information is not relevant for monitoring local
telephone service competition. As we noted in the Data Collection NPRM,
consumers increasingly can choose among telephone service offerings
that permit both local and long distance calling, often for a single
price. Indeed, it appears to us that offering combinations of services
at attractive prices appears to be an important, rapidly evolving way
for providers to compete by providing potential end users more, and
higher value, choices. It is important for us to more precisely
understand how such
[[Page 77916]]
bundling affects the overall development of local telephone service
competition.
21. Second, we modify Form 477 to require LECs to report their use
of UNE loops to serve their own end-user customers separately from
their use of UNE-Platform to do so. Because the current form does not
require this distinction to be made, we are not able at this time to
compare data and thereby evaluate, for accuracy and completeness, the
information reported to us about the numbers of UNE loops and UNE-
Platform provided to unaffiliated carriers. Therefore, we modify the
form to require LECs to report the extent to which they provision
voice-grade equivalent lines to their own local telephone service
customers over their own local loop facilities (or the fixed wireless
last-mile equivalent), over UNE loops obtained from an unaffiliated
carrier without switching, over UNE-Platform, or by reselling another
carrier's services (such as Centrex or special access) or facilities
obtained under commercial arrangements.
22. Finally, to simplify the form and thus minimize reporting
burdens where possible, we eliminate from the Form 477 several
questions about local telephone service that, in our experience, have
confused filers or otherwise have provided information of limited
usefulness. Specifically, we eliminate current requirements that force
LECs to: (1) Estimate the types of customers unaffiliated carriers
serve by means of the lines and UNE arrangements the LEC provides; (2)
report the extent to which they use local loop facilities they own and
UNE loops they obtain from another carrier to provision the services
the LEC provides to unaffiliated carriers for resale; and (3) report
information related to ``collocation'' arrangements with unaffiliated
carriers.
23. We also eliminate the current requirement that LECs report on
the Form 477 information about special access circuits that they
provide to unaffiliated carriers or to end users. (Filers' use of
channelized special access circuits to provide local exchange service
to their own end user customers will continue to be reflected in the
Form 477 data, however.) The current Form 477 collects information
about the number of special access circuits provided to unaffiliated
carriers or end users irrespective of the capacity of those circuits
(e.g., DS1, DS3, OCn), which seriously limits the usefulness of these
data in evaluating the extent of competition. We may, however, consider
collecting more precise information about special access services in
the future if circumstances warrant. Finally, we decide not to adopt
the proposal in the Data Collection NPRM to require mobile telephone
carriers to report the extent to which they are the default interstate
long distance carrier for the mobile telephone subscribers they report.
24. Other Issues. We will retain our current policies and
procedures regarding the confidential treatment of submitted Form 477
data, including the exclusive use of aggregated data in our published
reports. Moreover, we have decided not to adopt a different approach
with regard to historical data. Almost all commenters supported our
current data protection policies, and most argued that even historical
data remains competitively sensitive. We believe our current policies
and procedures afford more than adequate protection to any entity
submitting competitively sensitive information in the Form 477. We will
continue, however, our current practice of publishing most of the local
telephone information reported by the Bell operating companies after
consultation with the individual companies.
25. Because filers submitting Form 477 data routinely assert that
some or all such data are competitively sensitive, we see no need to
continue to require them to provide a separate, redacted file.
Accordingly, we eliminate that requirement. We expect that this action
by itself will substantially reduce the reporting burden imposed on a
large number of individual filers.
26. We also decide to retain our current policies and procedures
regarding the sharing of Form 477 data with state commissions. Such
data sharing only occurs where state entities formally declare to us
that they are willing and able to treat submitted information subject
to restrictions on data release that are at least as stringent as
federal requirements. Commenters generally do not oppose continuing
data-sharing arrangements on these terms.
27. Upon careful consideration of the record in this proceeding, we
decline to adopt certain modifications proposed or discussed in the
Data Collection NPRM. We decide not to modify Form 477 to require
filers to categorize broadband connections according to information
transfer rate (speed) that is actually observed by the end user of the
broadband connection. The record of this proceeding does not identify a
methodology or practice that currently could be applied, consistently
and by all types of broadband filers, to measure the information
transfer rates actually observed by end users. Moreover, we expect
broadband service providers to be mindful of general consumer
protection law and to advertise their services with sufficient accuracy
to enable end users to select the offering--as distinguished by ``speed
tier'' and other features--that best fits the end user's needs and
budget.
28. We also decide not to require filers to report the number of
broadband connections, by technology, in particular Zip Codes, or to
report, for each Zip Code, any information about the number of
connections provided in various ``speed tiers.'' Rather, by requiring
filers to report technology-specific lists of broadband Zip Codes in
the modified Form 477--and removing the reporting threshold to require
all facilities-based broadband providers to report--we believe we will
substantially enhance our ability to monitor the deployment of
established and emerging broadband platforms. Moreover, the comments of
several broadband providers asserted that developing the software and
systems necessary to generate such Zip Code-level data would impose a
large burden on the filer's financial and personnel resources, or would
require a number of months to implement. Accordingly, we decline to
require broadband providers to report this level of detail at this
time. We continue to recognize, however, that the presence of reported
subscribers in a Zip Code does not necessarily mean service is
available throughout the Zip Code, and we may revisit our decisions
about reporting detailed Zip Code-level data in the future. To this
end, we direct the Wireline Competition Bureau to assess more fully the
extent to which our Zip Code data adequately reflect the availability
of service throughout a Zip Code and to report its conclusions in the
next section 706 report.
29. Similarly, we also decide not to adopt at this time any
additional requirements that were not specifically proposed in the Data
Collection NPRM. For example, we decide not to require broadband
providers to report information about the prices at which they offer
broadband services to end users in particular Zip Codes, to require
mobile telephone carriers to estimate the percentage of wireless
subscribers that use their service as a replacement for traditional
landline service, or to require entities to report data according to
city boundaries. We are not convinced at this time that potential
benefits derived from collecting these additional data outweigh their
associated costs.
[[Page 77917]]
Procedural Matters
Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was
incorporated in the Data Collection NPRM (Notice). The Commission
sought written public comment on the proposals in the Notice, including
comment on the IRFA. The comments received are discussed below. This
present Final Regulatory Flexibility Analysis (FRFA) conforms to the
RFA.
I. Need for, and Objectives of, the Report and Order
2. The Commission initiated this rulemaking and made specific
proposals to improve its Form 477 local competition and broadband data-
gathering program and to extend the program for five years beyond its
currently designated sunset in March 2005. The Commission adopted the
Form 477 in the Spring of 2000 to help the Commission and the public
understand the extent of local telephone service competition and
broadband services deployment, which is important to the nation's
economic, educational, and social well-being. The decisions reached in
this Order will further that goal while minimizing burdens on
marketplace competitors and innovators, as well as small businesses.
II. Summary of Significant Issues Raised by Public Comments in Response
to the IRFA
3. In the IRFA, we stated that we would seek to minimize the burden
imposed on smaller entities by establishing requirements for reporting
that balanced the needs of the Commission to receive data on the
development of local competition and deployment of broadband against
the burden such reporting places on smaller entities. In response to
the Notice, the Commission received comments from 14 parties and reply
comments from 7 parties. In addition, the Office of Advocacy, U.S.
Small Business Administration (SBA), Verizon and the Vermont Public
Service Department (VPSD) made ex parte presentations. Among those
parties, only the SBA, the National Cable Television Association
(NCTA), the National Telecommunications Cooperative Association (NTCA),
and the Organization for the Promotion and Advancement of Small
Telecommunications Companies (OPASTCO) commented specifically on the
IRFA. We note that many other commenters raised issues about the
proposed rules and we encourage readers of this FRFA to consult the
complete text of this Order, which describes in detail our analysis of
commenter proposals.
4. In its ex parte presentation regarding the IRFA, the VPSD made
recommendations to simplify the expanded Form 477 proposed in the
Notice. In its ex parte presentation, SBA recommends that the
Commission consider less burdensome alternatives for small carriers,
such as simplifying the proposed Form 477 or establishing a ``short
form or Form 477-EZ'' for small carriers previously exempt from
reporting. OPASTCO stated that the Commission's estimated time to
complete the proposed Form 477 of 15 hours is understated, and that the
real number is 23 to 28 hours. NTCA agreed with OPASTCO and urged the
Commission to develop a new Form 477 that will reduce the amount of
information required from small carriers and take 30 minutes or less to
complete. NTCA further stated that the lowering or removing of the
current threshold exemption would result in an unwarranted burden on
small carriers. NCTA further recommended that the Commission establish
a new threshold of ``not lower than 100 broadband lines per state'' to
reduce that burden, while at the same time achieving the Commission's
objectives.
5. In an effort to balance the needs of the Commission with the
costs our data gathering may place on smaller entities, the Commission
has taken the suggestions of OPASTCO, NTCA and the SBA and simplified
the Form 477 proposed in the Notice. By doing so, we will lessen the
burden on all entities required to submit reports. We believe that
these modifications satisfy SBA's request that we significantly reduce
the burdens for those small entities that must comply. Moreover, we
conclude that these modifications will allow the Commission to comply
with Congress' charge in section 706 of the 1996 Act to determine
whether advanced telecommunications capability, commonly known as
``broadband,'' is being deployed to all Americans. In order to gain the
comprehensive understanding--as called for in section 706--of the
broadband market, particularly in rural and inner-city areas and among
demographic groups that are traditionally underserved, it is necessary
to gather data from entities that are most likely to serve these areas
and groups, which includes some smaller entities.
6. Among the other actions taken to reduce the overall burden on
small entities, we retain the ``decoupled'' feature where the broadband
and local competition reporting requirements are separate on the Form
477. Thus, we reduce reporting burdens on traditionally smaller
providers by only requiring data that covers services they actually
offer.
7. To further reduce the potential burden this data gathering
program may place on smaller entities, we retain several of the time-
saving and burden-reducing features of the original Form 477.
Specifically, the report frequency remains semiannual. We still require
carriers to report information about broadband connections and local
telephone services on a state-by-state basis. To supplement this
information, we ask providers of broadband connections and local
exchange services to provide lists of the Zip Codes in which they serve
at least one customer. Finally, we reaffirm that this reporting scheme
continues to offer the best balance of our need to achieve
geographically disaggregated information while minimizing burdens on
all entities, including small entities.
8. Overall, we believe that our approach (e.g., simplifying the
form and retaining the burden-reducing features of the original Form
477) will result in a program that is not overly burdensome on
reporting entities, and thus balances the concerns raised by SBA and
other commenters with the Commission's need to gain a better
understanding of developments in these markets.
III. Description and Estimate of the Number of Small Entities To Which
Rules Will Apply
9. The RFA directs agencies to provide a description of, and, where
feasible, an estimate of, the number of small entities that may be
affected by the rules adopted herein. The RFA generally defines the
term ``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A ``small business concern'' is one which: (1) Is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Administration (SBA).
10. The most reliable source of information regarding the total
numbers of certain common carrier and related providers nationwide, as
well as the number of commercial wireless entities, is the data that
the Commission publishes in its Trends in Telephone Service report. The
SBA has developed
[[Page 77918]]
small business size standards for wireline and wireless small
businesses within the three commercial census categories of Wired
Telecommunications Carriers, Paging, and Cellular and Other Wireless
Telecommunications. Under these categories, a business is small if it
has 1,500 or fewer employees. Below, using the above size standards and
others, we discuss the total estimated numbers of small businesses that
might be affected by our actions.
11. We have included small incumbent local exchange carriers (LECs)
in this present RFA analysis. As noted above, a ``small business''
under the RFA is one that, inter alia, meets the pertinent small
business size standard (e.g., a telephone communications business
having 1,500 or fewer employees), and ``is not dominant in its field of
operation.'' The SBA's Office of Advocacy contends that, for RFA
purposes, small incumbent LECs are not dominant in their field of
operation because any such dominance is not ``national'' in scope. We
have therefore included small incumbent LECs in this RFA analysis,
although we emphasize that this RFA action has no effect on Commission
analyses and determinations in other, non-RFA contexts.
12. Wired Telecommunications Carriers. The SBA has developed a
small business size standard for Wired Telecommunications Carriers,
which consists of all such companies having 1,500 or fewer employees.
According to Census Bureau data for 1997, there were 2,225 firms in
this category, total, that operated for the entire year. Of this total,
2,201 firms had employment of 999 or fewer employees, and an additional
24 firms had employment of 1,000 employees or more. Thus, under this
size standard, the great majority of firms can be considered small.
13. Incumbent Local Exchange Carriers (ILECs). Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to incumbent local exchange
services. The closest applicable size standard under SBA rules is for
Wired Telecommunications Carriers. Under that size standard, such a
business is small if it has 1,500 or fewer employees. According to
Commission data, 1,310 carriers reported that they were engaged in the
provision of local exchange services. Of these 1,310 carriers, an
estimated 1,025 have 1,500 or fewer employees and 285 have more than
1,500 employees. Consequently, the Commission estimates that most
providers of incumbent local exchange service are small businesses that
may be affected by the rules and policies adopted herein.
14. Competitive Local Exchange Carriers (CLECs). Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to providers of competitive exchange
services or to competitive access providers or to ``Other Local
Exchange Carriers,'' all of which are discrete categories under which
TRS data are collected. The closest applicable size standard under SBA
rules is for Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
According to Commission data, 563 companies reported that they were
engaged in the provision of either competitive access provider services
or competitive local exchange carrier services. Of these 563 companies,
an estimated 472 have 1,500 or fewer employees and 91 have more than
1,500 employees. In addition, 37 carriers reported that they were
``Other Local Exchange Carriers.'' Of the 37 ``Other Local Exchange
Carriers,'' an estimated 36 have 1,500 or fewer employees and one has
more than 1,500 employees. Consequently, the Commission estimates that
most providers of competitive local exchange service, competitive
access providers, and ``Other Local Exchange Carriers'' are small
entities that may be affected by the rules and policies adopted herein.
15. Interexchange Carriers (IXCs). Neither the Commission nor the
SBA has developed a size standard for small businesses specifically
applicable to interexchange services. The closest applicable size
standard under SBA rules is for Wired Telecommunications Carriers.
Under that size standard, such a business is small if it has 1,500 or
fewer employees. According to Commission data, 281 companies reported
that their primary telecommunications service activity was the
provision of interexchange services. Of these 281 companies, an
estimated 254 have 1,500 or fewer employees and 27 have more than 1,500
employees. Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by the rules and policies adopted herein.
16. Cellular Licensees. The SBA has developed a small business size
standard for Cellular and Other Wireless Telecommunication, which
consists of all such firms having 1,500 or fewer employees. According
to Census bureau data for 1997, there were 977 firms in this category,
total, that operated for the entire year. Of this total, 965 firms had
employment of 999 or fewer employees, and an additional 12 firms had
employment of 1,000 employees or more. Thus, under this size standard,
the majority of firms can be considered small.
17. Broadband Personal Communications Service. The broadband
Personal Communications Service (PCS) spectrum is divided into six
frequency blocks designated A through F, and the Commission has held
auctions for each block. The Commission defined ``small entity'' for
Blocks C and F as an entity that has average gross revenues of $40
million or less in the three previous calendar years. For Block F, an
additional classification for ``very small business'' was added and is
defined as an entity that, together with its affiliates, has average
gross revenues of not more than $15 million for the preceding three
calendar years.'' These standards defining ``small entity'' in the
context of broadband PCS auctions have been approved by the SBA. No
small businesses, within the SBA-approved small business size standards
bid successfully for licenses in Blocks A and B. There were 90 winning
bidders that qualified as small entities in the Block C auctions. A
total of 93 small and very small business bidders won approximately 40
percent of the 1,479 licenses for Blocks D, E, and F. On March 23,
1999, the Commission re-auctioned 347 C, D, E, and F Block licenses.
There were 48 small business winning bidders. On January 26, 2001, the
Commission completed the auction of 422 C and F Broadband PCS licenses
in Auction No. 35. Of the 35 winning bidders in this auction, 29
qualified as ``small'' or ``very small'' businesses. Based on this
information, the Commission concludes that the number of small
broadband PCS licenses will include the 90 winning C Block bidders, the
93 qualifying bidders in the D, E, and F Block auctions, the 48 winning
bidders in the 1999 re-auction, and the 29 winning bidders in the 2001
re-auction, for a total of 260 small entity broadband PCS providers, as
defined by the SBA small business size standards and the Commission's
auction rules. Consequently, the Commission estimates that 260
broadband PCS providers are small entities that may be affected by the
rules and policies adopted herein.
18. Narrowband Personal Communications Services. To date, two
auctions of narrowband personal communications services (PCS) licenses
have been conducted. For purposes of the two auctions that have already
been held, ``small businesses'' were entities
[[Page 77919]]
with average gross revenues for the prior three calendar years of $40
million or less. Through these auctions, the Commission has awarded a
total of 41 licenses, out of which 11 were obtained by small
businesses. To ensure meaningful participation of small business
entities in future auctions, the Commission has adopted a two-tiered
small business size standard in the Narrowband PCS Second Report and
Order. A ``small business'' is an entity that, together with affiliates
and controlling interests, has average gross revenues for the three
preceding years of not more than $40 million. A ``very small business''
is an entity that, together with affiliates and controlling interests,
has average gross revenues for the three preceding years of not more
than $15 million. The SBA has approved these small business size
standards. In the future, the Commission will auction 459 licenses to
serve Metropolitan Trading Areas (MTAs) and 408 response channel
licenses. There is also one megahertz of narrowband PCS spectrum that
has been held in reserve and that the Commission has not yet decided to
release for licensing. The Commission cannot predict accurately the
number of licenses that will be awarded to small entities in future
actions. However, four of the 16 winning bidders in the two previous
narrowband PCS auctions were small businesses, as that term was defined
under the Commission's rules. The Commission assumes, for purposes of
this analysis, that a large portion of the remaining narrowband PCS
licenses will be awarded to small entities. The Commission also assumes
that at least some small businesses will acquire narrowband PCS
licenses by means of the Commission's partitioning and disaggregation
rules.
19. 220 MHz Radio Service--Phase I Licensees. The 220 MHz service
has both Phase I and Phase II licenses. Phase I licensing was conducted
by lotteries in 1992 and 1993. There are approximately 1,515 such non-
nationwide licensees and four nationwide licensees currently authorized
to operate in the 220 MHz band. The Commission has not developed a
small business size standard for small entities specifically applicable
to such incumbent 220 MHz Phase I licensees. To estimate the number of
such licensees that are small businesses, we apply the small business
size standard under the SBA rules applicable to ``Cellular and Other
Wireless Telecommunications'' companies. This standard provides that
such a company is small if it employs no more than 1,500 persons.
According to Census Bureau data for 1997, there were 977 firms in this
category, total, that operated for the entire year. Of this total, 965
firms had employment of 999 or fewer employees, and an additional 12
firms had employment of 1,000 employees or more. If this general ratio
continues in the context of Phase I 220 MHz licensees, the Commission
estimates that nearly all such licensees are small businesses under the
SBA's small business size standard.
20. 220 MHz Radio Service--Phase II Licensees. The 220 MHz service
has both Phase I and Phase II licenses. The Phase II 220 MHz service is
a new service, and is subject to spectrum auctions. In the 220 MHz
Third Report and Order, we adopted a small business size standard for
``small'' and ``very small'' businesses for purposes of determining
their eligibility for special provisions such as bidding credits and
installment payments. This small business size standard indicates that
a ``small business'' is an entity that, together with its affiliates
and controlling principals, has average gross revenues not exceeding
$15 million for the preceding three years. A ``very small business'' is
an entity that, together with its affiliates and controlling
principals, has average gross revenues that do not exceed $3 million
for the preceding three years. The SBA has approved these small
business size standards. Auctions of Phase II licenses commenced on
September 15, 1998, and closed on October 22, 1998. In the first
auction, 908 licenses were auctioned in three different-sized
geographic areas: three nationwide licenses, 30 Regional Economic Area
Group (EAG) Licenses, and 875 Economic Area (EA) Licenses. Of the 908
licenses auctioned, 693 were sold. Thirty-nine small businesses won
licenses in the first 220 MHz auction. The second auction included 225
licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies
claiming small business status won 158 licenses.
21. Fixed Microwave Services. Fixed microwave services include
common carrier, private operational-fixed, and broadcast auxiliary
radio services. At present, there are approximately 22,015 common
carrier fixed licensees and 61,670 private operational-fixed licensees
and broadcast auxiliary radio licensees in the microwave services. The
Commission has not created a size standard for a small business
specifically with respect to fixed microwave services. For purposes of
this analysis, the Commission uses the SBA small business size standard
for the category ``Cellular and Other Telecommunications,'' which is
1,500 or fewer employees. The Commission does not have data specifying
the number of these licensees that have more than 1,500 employees, and
thus are unable at this time to estimate with greater precision the
number of fixed microwave service licensees that would qualify as small
business concerns under the SBA's small business size standard.
Consequently, the Commission estimates that there are up to 22,015
common carrier fixed licensees and up to 61,670 private operational-
fixed licensees and broadcast auxiliary radio licensees in the
microwave services that may be small and may be affected by the rules
and policies adopted herein. We noted, however, that the common carrier
microwave fixed licensee category includes some large entities.
22. Offshore Radiotelephone Service. This service operates on
several UHF television broadcast channels that are not used for
television broadcasting in the coastal areas of states bordering the
Gulf of Mexico. There are presently approximately 55 licensees in this
service. We are unable to estimate at this time the number of licensees
that would qualify as small under the SBA's small business size
standard for ``Cellular and Other Wireless Telecommunications''
services. Under that SBA small business size standard, a business is
small if it has 1,500 or fewer employees.
23. Wireless Communications Services. This service can be used for
fixed, mobile, radiolocation, and digital audio broadcasting satellite
uses. The Commission established small business size standards for the
wireless communications services (WCS) auction. A ``small business'' is
an entity with average gross revenues of $40 million for each of the
three preceding years, and a ``very small business'' is an entity with
average gross revenues of $15 million for each of the three preceding
years. The SBA has approved these small business size standards. The
Commission auctioned geographic area licenses in the WCS service. In
the auction, there were seven winning bidders that qualified as ``very
small business'' entities, and one that qualified as a ``small
business'' entity. We conclude that the number of geographic area WCS
licensees affected by this analysis includes these eight entities.
24. Satellite Services. The SBA has developed a small business size
standard for Satellite Telecommunications, which consists of all such
firms having $12.5 million or less in annual receipts. According to
Census Bureau data for 1997, in this category there was a total of 324
firms
[[Page 77920]]
that operated for the entire year. Of this total, 273 firms had annual
receipts of under $10 million, and an additional twenty-four firms had
receipts of $10 million to $24,999,999. Thus, under this size standard,
the majority of firms can be considered small.
25. In addition to the estimates provided above, we consider
certain additional entities that may be affected by the data collection
from broadband service providers. Because section 706 requires us to
monitor the deployment of broadband regardless of technology or
transmission media employed, we anticipate that some broadband service
providers will not provide telephone service. Accordingly, we describe
below other types of firms that may provide broadband services,
including cable companies, MDS providers, and utilities, among others.
26. Cable Television Relay Service. This service includes
transmitters generally used to relay cable programming within cable
television system distribution systems. The SBA has defined a small
business size standard for Cable and other Program Distribution,
consisting of all such companies having annual receipts of no more than
$12.5 million. According to Census Bureau data for 1997, there were
1,311 firms in the industry category Cable and Other Program
Distribution, total, that operated for the entire year. Of this total,
1,180 firms had annual receipts of $10 million or less, and an
additional 52 firms had receipts of $10 million or more but less than
$25 million. Thus, under this standard, we estimate that the majority
of providers in this service category are small businesses.
27. Cable System Operators (Rate Regulation Standard). The
Commission has developed, with SBA approval, its own definition of a
small cable system operator for purposes of rate regulation. Under the
Commission's rules, a ``small cable company'' is one serving fewer than
400,000 subscribers nationwide. Based on our most recent information,
we estimate that there were 1,439 cable operators that qualified as
small cable companies at the end of 1995. Since then, some of those
companies may have grown to serve over 400,000 subscribers, and others
may have been involved in transactions that caused them to be combined
with other cable operators. The Commission's rules define a ``small
system,'' for purposes of rate regulation, as a cable system with
15,000 or fewer subscribers. The Commission does not request nor does
the Commission collect information concerning cable systems serving
15,000 or fewer subscribers, and thus is unable to estimate, at this
time, the number of small cable systems nationwide.
28. Cable System Operators (Telecom Act Standard). The
Communications Act, as amended, also contains a size standard for a
small cable system operator, which is ``a cable operator that, directly
or through an affiliate, serves in the aggregate fewer than 1 percent
of all subscribers in the United States and is not affiliated with any
entity or entities whose gross annual revenues in the aggregate exceed
$250,000,000.'' The Commission has determined that there are 68,500,000
subscribers in the United States. Therefore, an operator serving fewer
than 685,000 subscribers shall be deemed a small operator if its annual
revenues, when combined with the total annual revenues of all of its
affiliates, do not exceed $250 million in the aggregate. Based on
available data, we find that the number of cable operators serving
685,000 subscribers or less totals approximately 1,450. Although it
seems certain that some of these cable system operators are affiliated
with entities whose gross annual revenues exceed $250,000,000, we are
unable at this time to estimate with greater precision the number of
cable system operators that would qualify as small cable operators
under the definition in the Communications Act.
29. Multipoint Distribution Service, Multichannel Multipoint
Distribution Service, and ITFS. Multichannel Multipoint Distribution
Service (MMDS) systems, often referred to as ``wireless cable,''
transmit video programming to subscribers using the microwave
frequencies of the Multipoint Distribution Service (MDS) and
Instructional Television Fixed Service (ITFS). In connection with the
1996 MDS auction, the Commission established a small business size
standard as an entity that had annual average gross revenues of less
than $40 million in the previous three calendar years. The MDS auctions
resulted in 67 successful bidders obtaining licensing opportunities for
493 Basic Trading Areas (BTAs). Of the 67 auction winners, 61 met the
definition of a small business. MDS also includes licensees of stations
authorized prior to the auction. In addition, the SBA has developed a
small business size standard for Cable and Other Program Distribution,
which includes all such companies generating $12.5 million or less in
annual receipts. According to Census Bureau data for 1997, there were a
total of 1,311 firms in this category, total, that had operated for the
entire year. Of this total, 1,180 firms had annual receipts of under
$10 million and an additional 52 firms had receipts of $10 million or
more but less than $25 million. Consequently, we estimate that the
majority of providers in this service category are small businesses
that may be affected by the rules and policies adopted herein. This SBA
small business size standard also appears applicable to ITFS. There are
presently 2,032 ITFS licensees. All but 100 of these licenses are held
by educational institutions. Educational institutions are included in
this analysis as small entities. Thus, we tentatively conclude that at
least 1,932 licensees are small businesses.
30. Local Multipoint Distribution Service. Local Multipoint
Distribution Service (LMDS) is a fixed broadband point-to-multipoint
microwave service that provides for two-way video telecommunications.
The auction of the 1,030 Local Multipoint Distribution Service (LMDS)
licenses began on February 18, 1998 and closed on March 25, 1998. The
Commission established a small business size standard for LMDS licenses
as an entity that has average gross revenues of less than $40 million
in the three previous calendar years. An additional small business size
standard for ``very small business'' was added as an entity that,
together with its affiliates, has average gross revenues of not more
than $15 million for the preceding three calendar years. The SBA has
approved these small business size standards in the context of LMDS
auctions. There were 93 winning bidders that qualified as small
entities in the LMDS auctions. A total of 93 small and very small
business bidders won approximately 277 A Block licenses and 387 B Block
licenses. On March 27, 1999, the Commission re-auctioned 161 licenses;
there were 40 winning bidders. Based on this information, we conclude
that the number of small LMDS licenses consists of the 93 winning
bidders in the first auction and the 40 winning bidders in the re-
auction, for a total of 133 small entity LMDS providers. The license
terms require the licensees to build their wireless facilities within
ten years of the grant. As a result, more information on the licensees
will become available in the year 2008, when the licensees are required
to show the Commission that they have achieved substantial service as
part of the application renewal process.
31. Electric Power Generation, Transmission and Distribution. This
industry group comprises establishments primarily engaged in
generating, transmitting, and/or distributing electric power.
Establishments in this industry group may perform one or more of the
[[Page 77921]]
following activities: (1) Operate generation facilities that produce
electric energy; (2) operate transmission systems that convey the
electricity from the generation facility to the distribution system;
and (3) operate distribution systems that convey electric power
received from the generation facility or the transmission system to the
final consumer. The SBA has developed a small business size standard
for the category of Electric Power Generation, Transmission and
Distribution. Under that standard, a firm is small if, including its
affiliates, its total electric output for the preceding fiscal year did
not exceed 4 million megawatt hours. According to Census Bureau data
for 1997, there were 1,519 firms in this category that operated for the
entire year. Census data do not track electric output and we have not
determined how many of these firms fit the SBA definition for small,
with fewer than 4 million megawatt hours of electric output.
Consequently, the Commission estimates that all 1,519 firms may be
considered small by the SBA definition.
IV. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements for Small Entities
32. The Order extends the data collection for five years and adopts
changes to the Form 477 that will affect reporting, recordkeeping, and
other compliance requirements. The Order requires all facilities-based
providers of broadband connections to end users to report broadband
data, all LECs to report local telephone service data, and all mobile
telephone carriers to report mobile telephone data. The other changes
to the Form 477 are described below.
33. The Form 477 changes:
Require cable systems that use (or whose affiliates or
agents use) the cable system's own plant to provide broadband cable
modem connections also to report a best estimate of the extent to which
those connections are available to the residential end user premises to
which the cable system offers cable programming service.
Require ILECs that use (or whose affiliates or agents use)
the ILEC's own telephone plant to provide broadband DSL connections
also to report a best estimate of the extent to which those connections
are available to the residential end user premises to which the ILEC
provides local telephone service.
Require filers to report the percentage of connections
that have information transfer rates exceeding 200 kilobits per second
(kbps) in both directions and rates in the faster direction that are,
respectively: (1) Greater than 200 kbps and less than 2.5 megabits per
second (mbps); (2) greater than or equal to 2.5 mbps and less than 10
mbps; (3) greater than or equal to 10 mbps and less than 25 mbps; (4)
greater than or equal to 25 mbps and less than 100 mbps; and (5)
greater than or equal to 100 mbps. (In the current Form 477 program,
filers report the percentage of connections that are faster than 2 mbps
in both directions.)
In place of the previous requirement that all filers
report broadband connections over ``other traditional wireline
including symmetric xDSL technology'' at the end user location, require
filers to report broadband connections separately for ``symmetric
xDSL'' and ``traditional wireline such as T-carrier'' technologies.
Require filers to report Zip Code lists separately for
asymmetric xDSL, symmetric xDSL, cable modem, optical carrier (fiber to
the end user), satellite, terrestrial fixed wireless, terrestrial
mobile wireless, electric power line, and (as a single category) other
technologies. (In the current Form 477 program, filers report a single
list of Zip Codes in which the filer has at least one subscriber to
broadband service without indicating the type of technology used.)
Require filers to estimate the percentage of reported
broadband connections that have information transfer rates exceeding
200 kbps in both directions, and that connect to residential end user
premises.
Require reporting competitive LECs explicitly to
distinguish their use of unbundled network element (UNE) loops from
their use of the UNE-Platform, and explicitly to report the extent to
which they provide telephone service lines by reselling another
carriers' services (such as Centrex or special access) or facilities
obtained under commercial arrangements. (In the current Form 477
program, competitive LECs report their use of all types of UNEs
together, and competitive LECs' use of resold service and facilities
obtained under commercial arrangements must be estimated, as a
residual, from other data they report.)
Remove the requirement, in the current Form 477 program,
that LECs must estimate the types of customers unaffiliated carriers
serve by means of the services and facilities the LEC provides under
``Total Service Resale'' arrangements, other resale arrangements, or as
unbundled network elements (UNEs).
Remove the requirement, in the current Form 477 program,
that LECs must report the extent to which they use local loop
facilities that they own and UNE loops that they obtain from another
carrier to provision the services they provide to unaffiliated carriers
for resale.
Remove the requirement, in the current Form 477 program,
that LECs must report information related to their ``collocation''
arrangements with unaffiliated carriers.
Require LECs report the extent to which they are also the
end user's default interstate long distance carrier.
V. Steps Taken To Minimize the Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
34. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives: (1) The
establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.
35. We have had the benefit of four year's experience since the
adoption of the original Form 477 reporting program. Accordingly, in
the Notice, we sought comment on ways that the Commission might improve
this data gathering effort. The Notice asked whether the collection of
more granular data would enhance the Commission's ability to understand
the status and degree of broadband deployment pursuant to section 706
of the 1996 Act. At the same time, the Notice asked for comment on ways
by which the Commission can limit burdens imposed on providers,
particularly with regard to smaller providers that may have limited
resources, prevent the dissemination of competitively-sensitive
information, and limit the data collection, wherever possible, to
information that providers routinely keep in the ordinary course of
business or that is easily derived from their records. The proposed
changes to the Form 477 set forth in the Notice would minimize
additional reporting burden by (1) focusing direct questions about
service availability on the two major residential high-speed services
and (2) allowing providers of those services to estimate state-level
service availability using methodologies they may already employ to
inform the investment community about system-wide service availability.
As a practical
[[Page 77922]]
matter, any additional reporting burdens on small entities should be
minimal. The few small facilities-based broadband service providers
that currently file Form 477 on a voluntary basis find that only a few
questions apply to their situation.
36. The Notice asked whether eliminating--or lowering--the
reporting threshold for broadband data (i.e., at least 250 high-speed
lines (or wireless channels) in a state connecting end users to the
Internet) would yield significantly improved data about broadband
deployment, particularly in rural areas, and requested that parties
identify with specificity any associated burdens. The Notice similarly
asked about the benefits and specific associated burdens of lowering
the reporting threshold for local telephone competition data (i.e., at
least 10,000 local telephone service lines (or wireless channels), or
at least 10,000 mobile telephone service subscribers, in a state). At
the same time, the Notice expressly stated the Commission's desire and
intention to work closely with service providers, including small
entities, to minimize burdens wherever possible, particularly for
smaller providers that may have limited resources.
37. In the Order, we take several significant steps to minimize the
burdens of reporting broadband information on small entities. First, we
simplify the new Form 477 from the one proposed in the Notice. We
expect that this simplification will reduce the time and administrative
burden to all carriers, including small entities. Next, we eliminate
the proposed requirements for carriers to report the number of
broadband connections, by technology, in particular Zip Codes, or to
report, for each Zip Code, any information about the number of
connections provided in various ``speed tiers.''
38. In this Order, we also take several significant steps to
minimize the burdens of reporting local telephone service data. We do
this by eliminating several reporting requirements of the original Form
477. In the new and simplified Form 477, LECs are no longer required to
report information about how they provision the wholesale local
telephone service connections that they report they provide to
unaffiliated carriers. Also, we no longer require LECs to report
information about how they provision unbundled network elements (UNEs)
that they report they provide to unaffiliated carriers. We will also no
longer require LECs to report information about special access circuits
that they provide. To the extent that carriers (e.g., competitive LECs)
obtain special access circuits, or private line circuits, from
unaffiliated LECs and use them to provision switched access lines to
their own end-user customers, however, they will continue to include,
in their own Form 477 filings, the switched access lines that they
provision in this manner.
39. To further simplify the filing process and reduce the
administrative burdens on all carriers, we will no longer require
filers to provide a separate, redacted file when the filer requests
confidential treatment of reported data. The new and simplified Form
477 promulgated by this Order will continue to enable filers to request
confidential treatment of their data by using a drop-down box located
on the first page of the Form 477 to indicate that claim. Then, if the
Commission receives a request for, or proposes the disclosure of,
information reported on that particular Form 477, the filer will be
notified and afforded the opportunity to make the necessary showing
that the data should not be disclosed. We will continue the current
practice of releasing only aggregated broadband information in our
published reports to protect against release of filer-specific
information directly or indirectly, as might occur, for example, if
published aggregates could be compared to redacted files.
VI. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
40. The FCC Form 477 promulgated in this Order and the FCC Form 325
(Annual Report of Cable Systems) collect data on cable modem and cable-
telephony service subscribers. The Form 325, however, focuses on cable
physical system (PSID) data. A Form 325 is required from each PSID that
has at least 20,000 subscribers and from a random sample of PSIDs that
have fewer than 20,000 subscribers. The data are associated on the form
with other aspects of physical system operation to give a complete
picture of related aspects of PSID operation. By contrast, the
requirement to report cable modem service connections on Form 477
applies to holding companies whose subsidiaries and affiliates provide
high-speed connections to end users in a particular state, and the
requirement to report cable-telephony lines applies when the holding
company provides local telephone service lines in a particular state.
Form 325 collects information based on operations as of a typical day
in the last full week of June. Form 477 collects data as of June 30 and
December 31. In the new Form 477 promulgated by this Order, facilities-
based providers report information about high-speed connections on Form
477, which, for its intended purposes, focuses on and is analyzed on a
holding company rather than PSID basis.
Ordering Clauses
Accordingly, it is ordered that, pursuant to sections 1-5, 10, 11,
201-205, 215, 218-220, 251-271, 303(r), 332, 403, 502, and 503 of the
Communications Act of 1934, as amended, 47 U.S.C. 151-155, 160, 161,
201-205, 215, 218-220, 251-271, 303(r), 332, 403, 502, and 503, and
pursuant to section 706 of the Telecommunications Act of 1996, 47
U.S.C. 157nt, this ORDER, with all attachments, is hereby adopted.
The rules in this document contain information collection
requirements that have not been approved by OMB. The Federal
Communications Commission will publish a document in the Federal
Register announcing the effective date.
It is further ordered that providers subject to the requirements
and regulation established in this Order shall complete and file the
amended Local Telephone Competition and Broadband Reporting Form (FCC
Form 477) no later than September 1, 2005, and semiannually thereafter.
It is further ordered that the Commission's Consumer Information
Bureau, Reference Information Center, shall send a copy of the Local
Telephone Competition and Broadband Reporting ORDER, including the
Final Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
FCC Form 477 and Instructions
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FCC Form 477, Instructions for September 1, 2005 Filing (of data as of
6/30/05)
OMB No: 3060-0816; Expiration Date: xx/xx/xxxx.
Estimated Average Burden Hours Per Response: 10 Hours.
Instructions for Local Telephone Competition and Broadband Reporting
Form (FCC Form 477)
I. Purpose
FCC Form 477 collects information about broadband connections to
end user locations, and about wired and wireless local telephone
services, in individual states. The term ``state'' includes the
District of Columbia and the ``Territories and possessions'' (see 47
U.S.C. 153(40)). Data obtained from this form will be used to describe
the deployment of broadband infrastructure and competition to provide
local telecommunications services. See Local Telephone Competition and
Broadband Reporting, Report and Order, FCC 04-266 (rel. Nov. 12, 2004)
for additional information about this data collection.
II. Who Must File This Form?
Three types of entities must file this form. For purposes of this
information collection, the term ``entity'' (and synonyms used in these
instructions) includes all commonly-controlled or commonly-owned
affiliates. (See 47 U.S.C. 153(1) (establishing a 10 percent equity
interest, or the equivalent thereof, as indicia of ownership.))
Facilities-based Providers of Broadband Connections to End
User Locations: Entities that are facilities-based providers of
broadband connections--which, for purposes of this information
collection, are wired ``lines'' or wireless ``channels'' that enable
the end user to receive information from and/or send information to the
Internet at information transfer rates exceeding 200 kilobits per
second (kbps) in at least one direction--must complete and file the
applicable portions of this form for each state in which the entity
provides one or more such connections to end user locations. For the
purposes of Form 477, an entity is a ``facilities-based'' provider of
broadband connections to end user locations if it owns the portion of
the physical facility that terminates at the end user location, if it
obtains unbundled network elements (UNEs), special access lines, or
other leased facilities that terminate at the end user location and
provisions/equips them as broadband, or if it provisions/equips a
broadband wireless channel to the end user location over licensed or
unlicensed spectrum. Such entities include incumbent and competitive
local exchange carriers (LECs), cable system operators, fixed wireless
service providers (including ``wireless ISPs''), terrestrial and
satellite mobile wireless service providers, MMDS providers, electric
utilities, municipalities, and other entities. (Such entities do not
include equipment suppliers unless the equipment supplier uses the
equipment to provision a broadband connection that it offers to the
public for sale. Such entities also do not include providers of fixed
wireless services (e.g., ``Wi-Fi'' and other wireless ethernet, or
wireless local area network, applications) that only enable local
distribution and sharing of a premises broadband facility.) For such
entities, the applicable portions of the form are: (1) The Cover Page;
(2) Part I; (3) Part IV (if necessary); and (4) The relevant portion(s)
of Part V.
Providers of Wired or Fixed Wireless Local Telephone
Services: Incumbent and competitive LECs must complete and file the
applicable portions of the form for each state in which they provide
local exchange service to one or more end user customers (which may
include ``dial-up'' ISPs). For such entities, the applicable portions
of the form are: (1) The Cover Page; (2) Part II; (3) Part IV (if
necessary); and (4) Column (j) of Part V.
Providers of Mobile Telephony Services: Facilities-based
providers of mobile telephony services (see 47 CFR 20.15(b)(1)) must
complete and file the applicable portions of this form for each state
in which they serve one or more mobile telephony subscribers. A mobile
telephony service is a real-time, two-way switched voice service that
is interconnected with the public switched network using an in-network
switching facility that enables the provider to reuse frequencies and
accomplish seamless handoff of subscriber calls. A mobile telephony
service provider is considered ``facilities-based'' if it serves a
subscriber using spectrum for which the entity holds a license, that it
manages, or for which it has obtained the right to use via lease or
other arrangement with a Band Manager. For such entities, the
applicable portions of this form. The applicable portions of the form
are: (1) The Cover Page; (2) Part III; and (3) Part IV (if necessary).
III. Line-by-Line Instructions for Completing FCC Form 477
(Note: Key terms that appear in this section are summarized in
VI. Glossary of Selected Terms Appearing on FCC Form 477.)
A. Cover Page--Name and Contact Information (All Filers Must Complete
the Cover Page)
Line 1: Provide the name of the company or operations whose data
are reported in this form. (If the filer has a holding company or other
controlling entity with a different name, that controlling entity's
name must be reported in Line 3 of the Cover Page.)
Line 2: Use the drop-down box to indicate whether the data in this
form are for incumbent LEC (ILEC) operations or for non-ILEC
operations. (Data for affiliated operations in a single state may be
combined in a single form, except that filers may not combine data for
ILEC operations with data for non-ILEC operations.)
Line 3: Use the drop-down box to select the single name, such as a
holding company name, that identifies all commonly-owned or commonly-
controlled entities that are filing Form 477. (If the appropriate name
is not included in the provided list, enter the appropriate name in the
space provided. If you have no holding company or other controlling
entity, enter in Line 3 the same name as you entered in Line 1 of the
Cover Page.)
Line 4: Use the drop-down box to select the state for which data
are reported in this form. (You may not combine, in a single form, data
for operations in more than one state. For example, the only data that
may be reported in a ``headquarters state'' form are data for
operations within that specific state.)
Line 5: Provide a contact name for the person who prepared this
filing.
Line 6: Provide the telephone number and e-mail address for the
contact person listed in Line 5 of the Cover Page.
Line 7: Use the drop-down box in Line 7 to indicate whether this
filing is an original or a revised filing. (You must file a revised
form if you discover mistakes as specified in Section IV.D. of these
instructions.)
Line 8: Use the drop-down box to indicate whether you request non-
disclosure of information reported in this form. You may request non-
disclosure if you believe some or all of the information reported in
this form is privileged and confidential and that public disclosure of
such information would likely cause substantial harm to the competitive
position of the filer.
[[Page 77931]]
B. Part I.A: Broadband
Include in Part I.A: In Part I.A., facilities-based providers of
broadband connections to end user locations report information about
those connections. See page 1 of these instructions for definitions of
facilities-based provider and broadband connection. End users are
residential, business, institutional and government entities who use
broadband services for their own purposes and who do not resell such
services to other entities or incorporate such services into retail
Internet-access services that they market to end users. (Note that an
Internet Service Provider is not an ``end user'' for purposes of Part I
of FCC Form 477.) The end users of retail services delivered over the
broadband connections reported in Part I.A. may be billed by the filer
(including affiliates), by an agent of the filer, or by an unaffiliated
entity. In categorizing lines as ``broadband,'' filers should consider
the end user's authorized maximum information transfer rate (speed) on
that connection. Do not convert into voice-grade equivalent measures
any connections reported in Part I.A.
Exclude in Part I.A: Exclude subscribership connections for cable
television service and other multi-channel video programming service;
video-on-demand type service unless it is bundled with Internet-type
access or uses Internet-type delivery protocols; and services that do
connect to the Internet but restrict the end user to both transmitting
data to the Internet and receiving data from the Internet at
information transfer rates (speeds) of 200 kbps or less. Exclude
connections between two locations of the same business or other end
user entity (such as point-to-point connections within private or semi-
private data networks or corporate telephone systems). Exclude high-
capacity connections between network components within the public
switched telephone network or the Internet (note that such connections
do not terminate at an end user location). Exclude in Part I.A. high-
capacity dedicated connections (special access circuits) between end
users and interexchange (telephone) carrier points of presence.
Lines in Part I.A
Report broadband connections to end user locations on Lines A.I-1
through A.I-10 based on the technology employed by the part of the
connection that actually connects to the end user location. If
different technologies are used in the two directions of information
transfer (downstream and upstream), report the connection in the
technology category for the higher-rate direction. Count only
connections that are in service, including connections over which you
(including affiliates or agents) provide an Internet-access service to
the end user and connections over which an unaffiliated entity (which
is not your agent) provides an Internet-access service to the end user.
Line A.I-1: Report the number of broadband connections provided
over asymmetric xDSL technologies. Do not convert these connections
into a voice-grade equivalent measure.
Line A.I-2: Report the number of broadband connections provided
over symmetric xDSL technologies. Do not convert these connections into
a voice-grade equivalent measure.
Line A.I-3: Report the number of broadband connections provided
over traditional wireline facilities, such as T-carrier. Do not include
broadband connections provided over symmetric xDSL service, but report
such connections in Line A.I-2. Do not convert these connections into a
voice-grade equivalent measure.
Line A.I-4: Report the number of cable modem connections. Do not
convert these connections into a voice-grade equivalent measure.
Line A.I-5: Report the number of broadband connections provided
over optical carrier terminations at the end-user premises. (Note that
broadband connections that are provisioned over optical fiber
facilities used elsewhere in the network should not be reported in this
category. For example, connections provisioned as ``fiber to the curb''
do not qualify because, by using a non-fiber ``drop,'' they are not
``fiber to the home.'') Do not convert these connections into a voice-
grade equivalent measure.
Line A.I-6: Report the number of broadband connections provided
over satellite facilities. Do not convert these connections into a
voice-grade equivalent measure.
Line A.I-7: Report the number of broadband connections provided
over terrestrial fixed wireless facilities (whether provisioned/
equipped over licensed spectrum or over spectrum used on an unlicensed
basis). Do not convert these connections into a voice-grade equivalent
measure. (Do not report those fixed wireless services (e.g., ``Wi-Fi''
and other wireless ethernet, or wireless local area network,
applications) that only enable local distribution and sharing of a
premises broadband facility.)
Line A.I-8: Report the number of subscribers to broadband services
provided over terrestrial mobile wireless facilities (whether
provisioned/equipped over licensed spectrum or over spectrum used on an
unlicensed basis). Terrestrial wireless broadband providers should
report the number of end users whose mobile devices, such as wireless
modem laptop cards, smartphones, or handsets, are capable of sending or
receiving data at speeds in excess of 200 kbps and whose billing
addresses are within the areas of terrestrial mobile wireless broadband
availability as reported in Part V.
Line A.I-9: Report the number of broadband connections provided
over electric power lines. Do not convert these connections into a
voice-grade equivalent measure.
Line A.I-10: Report the number of broadband connections provided
over all other technologies. Do not convert these connections into a
voice-grade equivalent measure. Note that the filer must identify each
specific technology used to provide the connections reported in Line
A.I-10, and the corresponding number of connections for each specific
technology, in the comment section of Part IV of the form.
Columns in Part I.A
General Note about Reporting Percentage Breakouts: Parts I, II, and
III of Form 477 direct filers to provide percentage breakouts for
specific counts of connections. If disaggregated counts exist for
another purpose, then these must be used to calculate the requested
percentage breakouts. However, filers are not expected to calculate
percentages based on exhaustive counts performed solely for this task.
Rather, where disaggregated counts do not exist, filers may provide
good faith estimates of percentages based on the best information
available to the filer. For example, if there is a pricing distinction
between services provided to residential end users, then billing
information may be used to estimate the percentage of connections
provided to such end users. In the absence of such information,
however, filers should rely on studies done for other purposes such as
marketing and business plan information, demographic data, etc. A filer
should conduct limited special studies only in the event that it cannot
provide estimates of percentage breakouts that it reasonably expects to
be accurate within plus or minus five percentage points.
Column (a): Report the total number of broadband connections as
described in each of Lines A.I-1 through A.I-10, above.
Column (b): Report the percentage of total connections reported in
column (a) that are residential connections in the
[[Page 77932]]
sense that these connections are used to deliver Internet-access
services that are primarily purchased by, designed for, and/or marketed
to residential end users. (Such Internet-access services may differ in
price, ``speed tier,'' and other features from Internet-access services
that are primarily purchased by, designed for, and/or marketed to non-
residential end users.)
Column (c): Report the percentage of total connections reported in
column (a) that are provided over your own local loop facilities, or
the wireless last-mile equivalent. Your own such facilities include
wired local loop facilities that you (including affiliates) owned,
wireless connections to end user locations that you (including
affiliates) have provisioned/equipped over spectrum that you use on an
unlicensed basis or over spectrum for which you hold a license, manage,
or have obtained the right to use via lease or other arrangement with a
Band Manager, and facilities you obtained the right to use from
unaffiliated entities as dark fiber or satellite transponder capacity
(and that you used as part of your own system). Do not include, in
column (c), broadband connections to end users that you provided over
UNEs, special access lines, and other leased lines that you obtained
from an unaffiliated entity and equipped as broadband.
Column (d): Report the percentage of total connections reported in
column (a) that are billed (or incorporated in a service billed) to end
users by the filer (including affiliates) or its agents. Do not include
in this percentage any lines reported in column (a) that are billed to
an unaffiliated Internet Service Provider (ISP) that has incorporated
the filer's broadband service into a premium Internet-access service
marketed under the unaffiliated ISP's own name.
Note on columns (e)-(j) of Part I.A: The percentages reported in
columns (e)-(j) of Part I.A refer, in each case, to connections that
carry information, at the end user location, at information transfer
rates exceeding 200 kbps in both directions. In categorizing broadband
connections in this manner, filers should consider the end user's
authorized maximum information transfer rate (speed) on that
connection.
Column (e): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and
that are residential connections in the sense that they are used to
deliver Internet-access services that are primarily purchased by,
designed for, and/or marketed to residential end users. (As noted in
the instructions for column (b), above, such Internet-access services
may differ in price, ``speed tier,'' and other features from Internet-
access services that are primarily purchased by, designed for, and/or
marketed to non-residential end users.)
Column (f): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and,
in the faster direction, at rates greater than 200 kbps and less than
2.5 mbps.
Column (g): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and,
in the faster direction, at rates greater than or equal to 2.5 mbps and
less than 10 mbps.
Column (h): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and,
in the faster direction, at rates greater than or equal to 10 mbps and
less than 25 mbps.
Column (i): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and,
in the faster direction, at rates greater than or equal to 25 mbps and
less than 100 mbps.
Column (j): Report the percentage of total connections reported in
column (a) that carry information, at the end user location, at
information transfer rates exceeding 200 kbps in both directions and,
in the faster direction, at rates greater than or equal to 100 mbps.
C. Part I.B: Broadband (continued)
Incumbent LECs that report xDSL (asymmetric or symmetric)
connections in Part I.A (or whose affiliates report such connections)
must complete Line B.I-11. Cable system operators that report cable
modem connections (or whose affiliates report such connections) in Part
I.A. must complete Line B.I-12.
Line B.I-11: Of those residential end user premises in this state
to which you (including affiliates) can deliver telephone service over
local loop facilities that you own (or over the fixed wireless last-
mile equivalent), report your best estimate of the percentage of
premises to which broadband (asymmetric or symmetric) xDSL service is
also available from you (or your affiliate, or an agent of you or your
affiliate) over those facilities.
Line B.I-12: Of those residential end user premises in this state
to which you (including affiliates) can offer cable television service
over cable plant that you own, report the best estimate of the
percentage of premises to which broadband cable modem service also is
available from you (or your affiliate, or an agent of you or your
affiliate) over that plant.
Residential end user premises include residential living units
(e.g., single family dwellings and individual households in multiple
dwelling units such as apartments, condominiums, mobile home parks,
etc.) and also individual living units in such institutional settings
as college dormitories and nursing homes. For the purposes of this data
collection, residential end user premises also include other end user
locations to which you (including your affiliates and agents) market
broadband services that are primarily designed for residential use.
Guidance on generating a ``best estimate': Rather than setting out
detailed methodologies to which filers must adhere in reporting
information in Part I.B., we intend to rely on current ``best
practices'' in the local exchange and cable television industries to
provide us with carefully considered estimates. Filers should note the
following points. (1) The reported estimate of xDSL or cable modem
service availability should not require degradation, outside of normal
operating parameters, of the service quality of the filer's most
heavily purchased type(s) of xDSL or cable modem service. (2) Filers
should take into account rule-of-thumb lessons from the experience of
deploying particular broadband services in similar areas (e.g.,
differences between actual and theoretical availability of xDSL service
to end user premises in areas in which the service already has been
deployed, such as may arise due from loop conditioning factors and loop
lengths).
D. Part II: Wireline and Fixed Wireless Local Telephone
Include in Part II: Report lines or wireless channels (hereafter,
``lines'') that you (including affiliates) use to provide voice
telephone service in this state. For purposes of this data collection,
``voice telephone service'' means local exchange or exchange access
services that allow end users to originate and/or terminate local
telephone calls on the public switched network, whether used by the end
user for voice telephone calls or for other types of calls carried over
the public switched network (for example, lines
[[Page 77933]]
used for facsimile equipment or lines used occasionally or exclusively
for ``dial-up'' connection to the Internet). See ``Note for reporting
channelized service,'' below.
Exclude in Part II: Do not report in Part II lines not yet in
service, lines used for interoffice trunking, company official lines,
lines used for special access service, or lines that were reported in
Part I of this form. Do not report in Part II any lines that connect
two locations of the same end user customer, ISP, or communications
carrier. Where you are already reporting the portion of a circuit
between the end user and your switching center, do not separately count
the portion of that circuit between your switching center and a circuit
switched, Internet protocol, or ATM network, irrespective of whether
you multiplexed the circuit onto a higher-capacity facility between
your switching center and that network. Note for reporting channelized
service: In Part II.A and Part II.B, providers must report voice-grade
equivalent lines. Count as one voice-grade equivalent line: traditional
analog POTS lines, Centrex-CO extensions, and Centrex-CU trunks.
Count lines based on how they are charged to the customer rather
than how they are physically provisioned. That is, when a customer is
charged for channelized service, report the number of activated,
charged-for channels rather than the theoretical capacity of the line.
Examples: Count Basic Rate Integrated (BRI) Services Digital Network
(ISDN) lines as two voice-grade equivalent lines. Count fully-
channelized PRI circuits (including PRIs that are used exclusively to
provide local connectivity to ``dial-up'' ISPs) as 23 voice-grade
equivalent lines. But report, for example, 8 voice-grade equivalent
lines if a customer is charged for 8 trunks that happen to be
provisioned over a DS1 circuit. If a customer is charged for a fully-
channelized DS1 circuit, however, report 24 voice-grade equivalent
lines. In Part II.C, however, any high-capacity UNEs should not be
reported in voice-grade equivalents. UNEs should be reported as actual
circuit counts. Note for competitive LECs providing local exchange
service over hybrid fiber-coaxial cable systems: If you cannot
determine the number of lines from your records, you may report the
number of subscribers.
Lines in Part II
In Line A.II-1 (service provided to end users) and Lines B.II-2
through B.II-3 (service provided to unaffiliated carriers for resale),
report voice-grade equivalent lines used to provide voice telephone
service. See ``Note for reporting channelized service,'' above.
Line A.II-1: Report total voice-grade equivalent lines that you
(including affiliates and agents) provided--that is, billed--directly
to end users. Include lines provided to end users by your agents or
under traditional marketing arrangements; for example, include lines
provided to shared-tenant service providers. Note that an Internet
Service Provider (ISP) may be an end user of local exchange service
lines. (For example, a ``dial-up'' ISP may purchase channelized PRI
circuits so that its customers can reach it via a local telephone
call.)
Line B.II-2: Report total voice-grade equivalent local telephone
service lines that you provided to unaffiliated telecommunications
carriers under a Total Service Resale arrangement (i.e., provided
pursuant to section 251(c)(4) of the Communications Act of 1934, as
amended).
Line B.II-3: Report total voice-grade equivalent local telephone
service lines that you provided to unaffiliated telecommunications
carriers under other arrangements, such as Centrex/Centron or special
access service, that provide the unaffiliated carrier with a connection
to the end user premises and enable the unaffiliated carrier to provide
local telephone service to the end user.
In Lines C.II-4 and C.II-5, report counts of circuits. Do not
convert circuits to voice-grade equivalent measures.
Line C.II-4: Report the number of circuits you provided to
unaffiliated telecommunications carriers under an unbundled network
element (UNE) loop arrangement, where you do not provide switching for
that circuit. Do not convert any high capacity circuits provided under
such UNE arrangements into voice-grade equivalent measures.
Line C.II-5: Report the number of circuits you provided to
unaffiliated telecommunications carriers under a UNE loop arrangement,
where you also provide switching for that circuit (i.e., ``UNE-
Platform''). Do not convert any high-capacity circuits provided under
such UNE arrangements into voice-grade equivalent measures.
Columns in Part II
Column (a): For Lines A.II-1 through B.II-3, report voice-grade
equivalent lines used to provide voice telephone service, as defined
above. For Lines C.II-4 and C.II-5, report the number of circuits
(i.e., not the voice-grade equivalent of those circuits).
Columns (b)-(j): Complete columns (b)-(j) for Line A.II-1. See also
``General note about reporting percentage breakouts,'' above.
Column (b): Report the percentage of the lines reported in column
(a) that are used for residential service. Include lines provided to
shared-tenant service providers in apartment buildings and similar
residential settings. ILEC filers may report based on the percentage of
lines reported in column (a) that are tariffed residential lines, with
an appropriate adjustment for lines provided under shared-tenant
service arrangements. Carriers that do not have separate residential
tariffs or price lists should use marketing or other information about
the demographic characteristics of the areas they serve to develop a
comparable estimate, or should undertake a limited special study.
Column (c): Report the percentage of the lines reported in column
(a) for which you (including affiliates) are the default interstate
long distance carrier, i.e., the (facilities-based or reseller) carrier
to which an interstate long distance call is routed automatically,
without the use of any access code by the end user.
Column (d): Report the percentage of the lines reported in column
(a) that are used for residential service (as specified in the
instructions for column (b), above) and for which you (including
affiliates) are the default interstate long distance carrier (as
specified in the instructions for column (c), above).
Column (e): Report the percentage of the lines reported in column
(a) that are provided over your own local loop facilities connecting to
the end user's premises. Count as your own such facilities, those wired
local loop facilities you (including affiliates) own, those facilities
you obtain the right to use from unaffiliated entities as dark fiber or
satellite transponder capacity (and that you use as part of your own
system), those fixed-wireless connections to end user premises that are
deployed over spectrum for which you hold a license, manage, or have
obtained the right to use via lease or other agreement with a Band
Manager, or those fixed-wireless connections that are deployed over
spectrum that you use on an unlicensed basis. Do not include, in column
(c), lines provided over UNE loops, special access lines, or other
leased lines that you obtained from an unaffiliated carrier.
Note for competitive LECs that own telephone switches: A
competitive LEC should include, in column (e), a line for which it
provided its own switching only if it also owned (as just discussed)
the local loop facilities that connect to the end user's premises.
[[Page 77934]]
Column (f): Report the percentage of lines reported in column (a)
that are provided over UNE loops that you obtained from an unaffiliated
carrier without also obtaining UNE switching from that carrier.
Column (g): Report the percentage of lines reported in column (a)
that are provided over UNE-Platform (i.e., the combination of loop UNE,
switching UNE, and transport UNE) that you obtained from an
unaffiliated carrier.
Column (h): Report the percentage of lines reported in column (a)
that are provided by reselling a telecommunications service (such as
Centrex/Centron or special access) that you obtained from an
unaffiliated carrier, or by using facilities that you obtained from an
unaffiliated carrier under a commercial arrangement.
Column (i): Report the percentage of lines reported in column (a)
that are delivered over coaxial cable facilities used in the part of
the line that connects to the end user premises (``cable telephony'').
Column (j): Report the percentage of lines reported in column (a)
that are delivered over fixed wireless facilities used in the part of
the line that connects to the end user premises.
E. Part III: Mobile Local Telephone
Line A. III-1: Report all mobile voice telephony subscribers served
over your own facilities that give customers the ability to place or
receive calls from the public switched telephone network. (See column
(a), below, for how to count subscribers.) Include: satellite,
cellular, and PCS telephone service and other terrestrial mobile
services; and, units in service that combine voice telephone with other
services. Report subscribers that you (including affiliates) serve
using spectrum for which you hold a license, manage, or have obtained
the right to use via lease or other agreement with a Band Manager. Do
not report any subscribers that you serve by reselling an unaffiliated
carrier's mobile telephone service.
Note: Exclude mobile services that customers cannot use to
directly place calls to subscribers of ordinary telephone service,
such as dispatch services and one-way or two-way paging services.
Also exclude voice services that permit communications between only
a narrow range of locations such as automobile units that permit
drivers to communicate only with a specific road service.
Column (a): Report the total number of mobile voice telephony
subscribers in the state that are served over your own facilities.
Count as a subscriber a mobile handset, car-phone, or other revenue-
generating, active, voice unit that has a unique phone number and that
can place and receive calls from the public switched network. Include
in column (a) subscribers that you (including affiliates) bill directly
(including through agents), pre-paid subscribers, and subscribers
served via unaffiliated mobile telephone service resellers. Subscriber
counts by state should be based on the area codes of the phone numbers
provided to subscribers.
Column (b): Report the percentage of subscribers in column (a) that
you bill directly (including through agents) or serve on a pre-paid
basis. Do not include subscribers that are billed by an unaffiliated
mobile telephone service reseller.
F. Part IV: Explanations and Comments
Filers that must report: If there is a non-zero entry in column (a)
of Line A.I-10 of Part I of a form, the filer must identify each
specific technology used to provide the broadband connections reported
in Line A.I-10, and the corresponding number of connections for each
specific technology, in the comment section of Part IV of the form.
Other filers: Complete Part IV to furnish relevant explanatory
information with your data. For example, an explanation should be
provided if a percentage figure has changed noticeably from earlier
filings. In Part IV, filers should identify the Part and Line to which
their comment applies in the columns provided.
G. Part V: Zip Code Listings
Line V-1: Report, in the appropriate column, the 5-digit Zip
Codes--for this state--in which you provide at least one of the
broadband connections reported in Part I.A, or at least one of the
voice-grade telephone service lines provided to end users reported in
Part II, Line II.A-1. Do not report line counts or subscriber counts by
Zip Code.)
Column (a)-(i): If you file broadband information in Part I, you
must provide, for each individual technology indicated by the column
head, a list of Zip Codes in the state in which at least one of the
broadband connections reported in Part I is in service--except that the
Zip Codes reported in column (g) should be the Zip Codes in the state
in which the mobile wireless broadband service provider's service is
advertised and available to actual and potential subscribers.
Column (j): If you file local telephone service information in Part
II, Line II.A-1, you must provide a list of Zip Codes in the state in
which you have end user customers for your voice telephone service.
(See the definition of ``voice telephone service,'' above.) Providers
of mobile telephony services that report data in Part III should not
report this Zip Code information.
Note: Zip Code lists reported in a form should be reviewed prior
to filing to eliminate any out-of-state Zip Codes (such as may
appear in Zip Code lists generated directly from billing databases).
IV. General Information
A. Where and When to File
1. When to File
March 1st of each year: providers must file data as of
December 31 of the preceding year.
September 1st of each year: providers must file data as of
June 30 of the same year.
2. Where To File
All filers must deliver to the FCC the signed, original paper copy
of the Certification Statement. The Certification Statement is the
single page that constitutes Section V of these instructions. Filers
must deliver completed Form 477(s) to the FCC on electronic media.
Paper copies of completed Form 477s may not be submitted. Acceptable
electronic media are spreadsheet files attached to an e-mail message,
or one or more IBM format compact discs or 3.5-inch floppy diskettes
containing such files. The latter should be clearly labeled to identify
contents by (at a minimum): FCC Form 477 (6/30/05 data), name of filer,
and the states for which data are included. In all cases, filers should
use up-to-date virus detection software to ensure that electronic media
are virus-free.
Attention: The United States Postal Service (USPS) requires all
First Class, Priority, and Express Mail addressed to the Zip Code in
which the FCC Headquarters is located to be irradiated (cleaned) prior
to delivery. Because irradiation can damage compact discs and floppy
diskettes, filers are encouraged to submit Form 477 using one of the
following three alternatives--preferably e-mail. (Use only one filing
method; do not make duplicate filings. A filer who is unable to use one
of the following delivery methods should contact the Industry Analysis
and Technology Division, Wireline Competition Bureau, at (202) 418-0940
or via TTY at (202) 417-0484.)
E-mail: Filers are encouraged to deliver completed Form 477(s) as
attachments to one or more e-mail messages sent to FCC477@fcc.gov.
Filers submitting multiple files may use a zip utility to compress
them. The subject field of the e-mail should contain the
[[Page 77935]]
phrase: FCC Form 477 due 9/1/05. If multiple e-mails must be sent, the
subject line should so indicate; for example: FCC Form 477 due 9/1/05
(message 1 of 3). Filers submitting Form 477(s) by e-mail may deliver
the signed, original paper copy of the Certification Statement by USPS
first-class mail addressed to: FCC FORM 477 (ATTN: WCB/IATD, Room 6-
A220), Federal Communications Commission, 445 12th Street, SW.,
Washington, DC 20554. (Alternatively, filers may deliver the signed,
original copy of the Certification Statement by one of the following
methods.)
Overnight delivery service other than USPS Express Mail or Priority
Mail: Compact discs, or floppy diskettes, containing completed Form
477(s)--accompanied by the signed, original copy of the Certification
Statement--may be delivered by an overnight delivery service other than
USPS Express Mail or Priority Mail (e.g., UPS, DHL, Federal Express).
Such deliveries must be addressed and delivered to: FCC FORM 477 (ATTN:
WCB/IATD, Room 6-A220), Federal Communications Commission, 9300 East
Hampton Drive, Capitol Heights, MD 20743. Filers who want a
confirmation of receipt may include a stamped, self-addressed envelope
and a photocopy of the Certification Statement, which will be receipt-
stamped and returned by mail.
Hand delivery or messenger delivery: Local hand and messenger
deliveries directed to the Commission's Secretary are accepted at 236
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. All Form
477 filing materials delivered to this location must be clearly
identified to be re-directed to: FCC FORM 477 (ATTN: WCB/IATD, Room 6-
A220).
Note: Because the specific requirements for overnight, hand, or
messenger delivery may change, you may want to consult the Office of
the Secretary (http://www.fcc.gov/osec) for the most current information.
B. How To File
1. Preparation of Data Files
You must file your local competition and broadband deployment data
using the electronic version of Form 477 that is available at
http://www.fcc.gov/formpage.html or by purchase from the FCC's duplicating
contractor, Best Copy and Printing, Inc. at (202) 488-5300, facsimile
(202) 488-5563, or through http://www.bcpiweb.com. Form 477 will be updated
for each filing round, and filers must obtain the latest version for
each filing period. Filers should also obtain the latest version of
Instructions for Form 477.
The electronic version of Form 477 is provided in Excel 2002
format. It contains drop-down boxes and some edit checks. Once you
complete a filing, name the file in accordance with instructions
provided below.
Note: You may not move cells, insert or delete rows, or change
the validation or formatting characteristics of any cell. If the FCC
cannot load your files into its databases as a result of
modifications to the file, you will be required to correct and
resubmit those files. Filers must save each Form 477 as a separate
spreadsheet file. Do not submit multiple Form 477 worksheets within
a single Excel 2002 workbook. Filers choosing to submit Form 477(s)
on a floppy diskette(s), or compact disc(s), may place multiple
spreadsheet files on a single diskette or compact disc.
Each file name must adhere to the following convention:
SSTHyearname.xls, where:
SS is the two letter post office abbreviation for the state.
T is a single character that indicates whether the file contains
incumbent LEC (ILEC) data or non-ILEC data (which must be filed
separately) and whether the file contains revised data. Select the
appropriate code from the following list:
A = original filing for non-ILEC operations
B = original filing for ILEC operations
C = revised filing for non-ILEC operations
D = revised filing for ILEC operations
# is a ``sequence number'' (i.e., 1, 2, 3, etc.) to be used to
differentiate what would otherwise be identically named files when the
file names are constructed according to the convention specified here.
If no such redundancy of file names occurs, use the number ``1'' in
place of the character ``''.
H is the half of the year of the data being filed. Use: ``J'' for
data as of June 30; ``D'' for data as of December 31.
year is the last two digits of the year of the data being filed
(e.g., for the filing due September 1, 2005, reported data will be as
of June 30, 2005, so 2005 = 05).
name is the company name identified on Line 1 of the Cover Page of
Form 477.
Example: NCB1J05BellSouth.xls
2. Additional Directions for Filing
Filers must submit the original, signed paper copy of the
Certification Statement (which is the single page that constitutes
Section V of these Instructions). The Certification statement must be
signed in ink by an officer of the filer of one of the legal entities
whose data is included. An officer is a person who occupies a position
specified in the articles of incorporation (or partnership agreement),
and would typically be president, vice president for operations, vice
president for finance, comptroller, treasurer or a comparable position.
If the filer is a sole proprietorship, the owner must sign the
certification.
C. Requesting Confidentiality
Filers may submit a request that information on Form 477 not be
made routinely available for public inspection by so indicating on Line
8 of the Cover Page of the form and on the Certification Statement. See
also 47 CFR 0.457, 0.459, 1.7001(d), 43.11(c); Examination of the
Current Policy Concerning the Treatment of Confidential Information
Submitted to the Commission, FCC 98-184 (rel. Aug. 4, 1998).
D. Obligation To File Revisions
Filers must submit a revised form if the filer discovers a
significant error in the data. For counts, a difference amounting to 5
percent of the filed number must be re-filed. For percentages, a
difference of 5 percentage points is significant and must be re-filed.
Revisions should consist of a certification statement and one or more
electronic files. Carriers should re-file all data for a state if one
or more data element must be revised. A re-filed Form 477 spreadsheet
should contain all appropriate data for the state, not just the
corrected figures. Note that files containing revisions must be given
different names from the original filings, as specified above, Section
IV.B.1 of these instructions.
E. Compliance
Service providers that are required to file the Form 477 but fail
to do so may be subject to enforcement action under sections 502 and
503 of the Communications Act and any other applicable law, 47 U.S.C.
502, 503.
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VI. Glossary of Selected Terms Appearing on FCC Form 477
The following selected terms are noted on FCC Form 477. The filer
must interpret these terms in the specific context of the detailed
reporting instructions, above. All terms are as defined for the
specific purposes of this information collection.
Part I: Broadband
Broadband connections: Lines (or wireless channels) that terminate
at an end user location and enable the end user to receive information
from and/or send information to the Internet at information transfer
rates exceeding 200 kilobits pe