Implementation of the Net 911 Improvement Act of 2008, 31860-31874 [E9-15822]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 74, Number 127 (Monday, July 6, 2009)]
[Rules and Regulations]
[Pages 31860-31874]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-15822]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 9

[WC Docket No. 08-171; FCC 08-249]


Implementation of the Net 911 Improvement Act of 2008

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: The Federal Communications Commission (Commission) has adopted 
rules implementing certain key provisions of the New and Emerging 
Technologies 911 Improvement Act of 2008 (NET 911 Act), which was 
enacted on July 23, 2008. Congress directed the Commission to issue 
rules implementing certain key provisions of the NET 911 Act no later 
than October 21, 2008. In particular, to effectuate the statutory 
requirement that providers of interconnected voice over Internet 
Protocol (interconnected VoIP) service provide 911 and enhanced 911 
(E911) service in full compliance with the Commission's rules, Congress 
mandated that the Commission issue regulations in this time frame that, 
among other

[[Page 31861]]

things, ensure that interconnected VoIP providers have access to any 
and all capabilities they need to satisfy that requirement.

DATES: Effective October 5, 2009, except for Sec.  9.7(a) which 
contains information collection requirements that are not effective 
until approved by the Office of Management and Budget (OMB). The 
Commission will publish a document in the Federal Register announcing 
the effective date of such requirements.

ADDRESSES: Federal Communications Commission, 445 12th Street, SW., 
Washington, DC 20554.
    Interested parties may submit PRA comments identified by OMB 
Control Number 3060-1085, by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web Site: https://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
     E-mail: Parties who choose to file by e-mail should submit 
their comments to Tim.Stelzig@fcc.gov. Please include WC Docket Number 
08-171 and FCC No. 08-249 in the subject line of the message.
     Mail: Parties who choose to file by paper should submit 
their comments to Tim Stelzig, Federal Communications Commission, Room 
5-C261, 445 12th Street, SW., Washington, DC 20554.
    In addition to filing comments with the Office of the Secretary, a 
copy of any comments on the Paperwork Reduction Act information 
collection requirements contained herein should be submitted to Judith 
B. Herman, Federal Communications Commission, Room 1-B441, 445 12th 
Street, SW., Washington, DC 20554, or via the Internet to PRA@fcc.gov.

FOR FURTHER INFORMATION CONTACT: Tim Stelzig, Competition Policy 
Division, Wireline Competition Bureau, at (202) 418-0942. For 
additional information concerning the Paperwork Reduction Act 
information collection requirements 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. 08-171, FCC 08-249, adopted and 
released October 21, 2008. The complete text of this document is 
available for inspection and copying during normal business hours in 
the FCC Reference Information Center, Portals II, 445 12th Street, SW., 
Room CY-A257, Washington, DC, 20554. This document may also be 
purchased from the Commission's duplicating contractor, Best Copy and 
Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 
20554, telephone (800) 378-3160 or (202) 863-2893, facsimile (202) 863-
2898, or via e-mail at https://www.bcpiweb.com. It is also available on 
the Commission's Web site at https://www.fcc.gov.

Final Paperwork Reduction Act of 1995 Analysis

    This document contains new information collection requirements. The 
Commission, as part of its continuing effort to reduce paperwork 
burdens, invites the general public to comment on the information 
collection requirements contained in this Order as required by the 
Paperwork Reduction Act of 1995, Public Law 104-13. In addition, the 
Commission notes that pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we 
previously sought specific comment on how the Commission might 
``further reduce the information collection burden for small business 
concerns with fewer than 25 employees.''
    In this present document, we have assessed the effects of the rules 
implementing the Net 911 Improvement Act of 2008, and find the rules 
adopted are warranted. The reasons for this conclusion are explained in 
more detail below.
    Report to Congress: On January 27, 2009, the Commission sent a copy 
of the Order, including this FRFA, in a report to Congress and the 
Government Accountability Office pursuant to the Congressional Review 
Act, see 5 U.S.C. 801(a)(1)(A). In addition, the Commission will send a 
copy of the Order, including this FRFA, to the Chief Counsel for 
Advocacy of the SBA. [A copy of this present summarized Order and FRFA 
is also hereby published in the Federal Register.]

Synopsis of the Order

    1. Background. The Commission released a notice of proposed 
rulemaking on August 25, 2008, seeking comment regarding the specific 
duties imposed by the NET 911 Act and the regulations that the 
Commission is required to adopt. See 73 FR 50741 (Aug. 28, 2008). The 
Commission sought comment, for example, on what 911 and E911 
capabilities must be made available to interconnected VoIP providers, 
and how such capabilities could be made available on the same rates, 
terms, and conditions afforded to wireless providers. The Commission 
also sought comment on what technical, network security, or information 
privacy requirements regarding 911 and E911 calls are specific to 
interconnected VoIP service.
    2. Discussion. In the Order, the Commission turned first to its 
obligation under section 6(c)(1) of the Wireless 911 Act to issue 
regulations ensuring that interconnected VoIP providers can exercise 
their rights of access to any and all ``capabilities'' they need to be 
able to provide 911 and E911 service in full compliance with the 
Commission's rules from ``an entity with ownership or control over such 
capabilities.'' Congress did not define key terms of these provisions, 
such as the ``capabilities'' to which interconnected VoIP providers 
have a right of access, or an ``entity'' with ownership or control over 
capabilities, but left the elucidation of these terms to the 
Commission. The Commission interpreted these terms, examining the 
statutory language itself, its legislative history, and the record. The 
Commission next discussed the ``rates, terms and conditions'' that 
apply to that access. It then imposed certain security requirements to 
protect the integrity of the 911 system.
    3. Access to E911 Capabilities. Need for Rules in General. The 
Order first discussed the scope of the Commission's obligation to 
``issue regulations implementing the [NET 911] Act, including 
regulations that * * * ensure that IP-enabled voice service providers 
have the ability to exercise their rights [to access].'' The Commission 
concluded that having rules establishing standards for access to 
capabilities best fulfills the Commission's obligations and the goals 
of the NET 911 Act. Congress clearly intended for the Commission to 
implement regulations more specific than the statutory language itself. 
In section 6(c), Congress specifically directed the Commission to 
conduct this rulemaking to assure interconnected VoIP providers' rights 
under section (6)(b), taking into account specific factors, such as 
``any technical, network security, or information privacy requirements 
that are specific to IP-enabled voice services.'' If Congress had not 
intended the Commission to implement rules more detailed than the 
statute itself, it would not have instructed the Commission to take 
certain things into account; it would have left the statutory language 
as sufficient and self-effectuating. The Commission therefore disagreed 
with commenters who suggested that no specific rules are needed, or 
that any rules can simply parrot the statutory language.

[[Page 31862]]

    4. The Commission also declined to issue highly detailed rules 
listing capabilities or entities with ownership or control of those 
capabilities. As recognized above and explained further in the Order, 
the nation's 911 system varies from locality to locality, and overly 
specific rules would fail to reflect these local variations. 
Furthermore, as Congress recognized, the nation's 911 system is 
evolving from its origins in the circuit-switched world into an IP-
based network. The Commission stated that its rules should be 
sufficiently flexible to accommodate this ongoing process. Indeed, 
Congress specifically prohibited the Commission from ``issu[ing] 
regulations that require or impose a specific technology or 
technological standard,'' which specific, invariable rules could do. 
The Commission therefore adopted rules that establish standards for 
determining to what capabilities interconnected VoIP providers have a 
right of access and from which entities, and explained in the Order 
what capabilities and entities would typically (but not necessarily) be 
encompassed in today's architecture.
    5. Standard for Right of Access to Capabilities. Consistent with 
the approach just described, the Commission adopted rules establishing 
a standard for determining to what capabilities interconnected VoIP 
providers have a right of access, and also providing examples of the 
capabilities that will typically be required in most local 911 and E911 
architectures. In later parts of the Order, the Commission explained 
that capabilities may only be used for the provision of 911 and E911 
service.
    6. The analysis in the Order begins first with the statutory 
language. While the statute does not define the term ``capabilities,'' 
it does provide that interconnected VoIP providers have a right of 
access to capabilities on the same ``rates, terms, and conditions that 
are provided to a provider of commercial mobile service.'' Pursuant to 
its authority under the NET 911 Act, the Commission issued rules to 
grant interconnected VoIP providers a right of access to the 
capabilities commercial mobile radio service (CMRS) providers use to 
provide E911 service equal to the access rights made available to CMRS 
providers. Congress clearly recognized a commonality between the 
capabilities needed by interconnected VoIP providers and those already 
used by CMRS providers. Indeed, if an owner or controller of a 
capability used to provide E911 service made it available to a CMRS 
provider at a certain rate but refused to grant interconnected VoIP 
providers access to that same capability, that interconnected VoIP 
provider would not ``have a right of access to such capabilities * * * 
to provide [E911] service on the same rates, terms, and conditions that 
are provided to a provider of [CMRS].'' The Commission also found 
support for this position in the context in which this legislation was 
enacted. As explained above, the capabilities used by interconnected 
VoIP providers--particularly those providing a nomadic or mobile 
service--to provide E911 service are similar to those used by CMRS 
providers; interpreting the statute to mean that interconnected VoIP 
providers have a right of access to those capabilities used by CMRS 
providers furthers Congress's goal of ``ensur[ing] that consumers using 
Voice over Internet Protocol (VoIP) service can access enhanced 911 (E-
911) emergency services by giving VoIP providers access to the 
emergency services infrastructure.''
    7. Second, with respect to any capabilities that are not provided 
to CMRS providers for their provision of E911 service, the Commission 
interpreted the NET 911 Act as granting interconnected VoIP providers a 
right of access if the capability is necessary for the interconnected 
VoIP provider to provide E911 service in compliance with the 
Commission's rules. For reasons similar to those outlined in the 
previous paragraph, the Commission stated the Commission's belief that 
the right of an interconnected VoIP provider to certain rates, terms, 
and conditions necessarily includes a right of access to such 
capability. Section 6(c)(1)(C) of the Wireless 911 Act provides that 
``with respect to any capabilities that are not required to be made 
available to a [CMRS] provider but that the Commission determines * * * 
are necessary for an [interconnected VoIP] provider to comply with its 
obligations [to provide E911 service in accordance with the 
Commission's rules], that such capabilities shall be available at the 
same rates, terms, and conditions as would apply if such capabilities 
were made available to a [CMRS] provider.'' The Commission also found 
that this text limits interconnected VoIP providers' right of access to 
such capabilities to those that are necessary to provide E911 service 
in compliance with the Commission's rules.
    8. Third, regardless whether a capability is used by a CMRS 
provider or not, for any capability an interconnected VoIP provider 
gets pursuant to rights granted in the NET 911 Act and the Commission's 
implementing rules, the Order stated that such capability may be used 
by that provider only for the purpose of providing E911 service in 
accordance with the Commission's rules. The NET 911 Act explicitly 
mandates this limit on interconnected VoIP providers' statutory access 
rights with respect to capabilities CMRS providers use to provide E911 
service. The Commission recognized that the statute does not expressly 
contain a similar limitation in section 6(c)(1)(C), which grants 
interconnected VoIP providers a right to access the capabilities they 
need to provide E911 service even if they are not capabilities CMRS 
providers use to provide E911 service. Nevertheless, the Commission's 
interpretation of the NET 911 Act is informed by the legislative 
history as well as Congress's overarching purpose in enacting the 
provisions at issue here. Both with respect to capabilities that are 
used by CMRS providers and those that are not, the NET 911 Act is clear 
that its purpose is to facilitate interconnected VoIP providers' 
ability to provide E911 service in compliance with the Commission's 
rules, without granting access rights to additional capabilities. This 
overarching purpose indicates that Congress intended that any 
capabilities to which access is gained pursuant to the NET 911 Act may 
be used exclusively for the purpose of providing E911 service. In 
addition, the record indicates that CMRS providers use most of the 
capabilities interconnected VoIP providers need to provide E911 
service. The Commission did not find any reason to believe that 
Congress would have granted interconnected VoIP providers more 
expansive rights with respect to the relatively small subset of 
capabilities that are not used by CMRS providers to provide E911 
service than those capabilities that are. Therefore, the Commission 
stated it is reasonable to require that interconnected VoIP providers 
use all capabilities that they obtain pursuant to the NET 911 Act and 
this Order exclusively for the provision of E911 service in compliance 
with the Commission's rules.
    9. Typical Capabilities. The record reflects general consensus as 
to what capabilities are used by CMRS providers today and what 
capabilities are not used by CMRS providers but are ``necessary'' for 
interconnected VoIP providers to comply with the Commission's rules. As 
AT&T explains, CMRS providers have been offering E911 services for many 
years and even interconnected VoIP providers have been providing such 
services since 2005. The Commission therefore interpreted 
``capabilities'' to include all those items described in part II of the 
Order that are used by wireless

[[Page 31863]]

providers today or that are not used by wireless providers but are 
necessary to interconnected VoIP providers' compliance with the 
Commission's rules. Thus, in a typical local architecture, 
``capabilities'' will include: the Selective Router; the trunk line(s) 
between the Selective Router and the PSAP(s); the Automatic Location 
Information Database (ALI Database); the Selective Router Database (SR 
Database); the Database Management System (DBMS), the Master Street 
Address Guide (MSAG); pseudo-ANIs (p-ANIs); Emergency Service Numbers 
(ESNs); mobile switching center capabilities; mobile positioning center 
capabilities; shell records; the data circuits connecting these 
elements; and the network elements, features, processes, and agreements 
necessary to enable the use of these elements.
    10. Entities with Ownership or Control of Capabilities. The 
Commission concluded that interconnected VoIP providers are entitled to 
access to capabilities from any entity that owns or controls such 
capabilities. Again, it found this interpretation to be the most 
natural reading of the statutory language. Section 6(b) grants 
interconnected VoIP providers a right to access ``such capabilities,'' 
with ``such'' referring back to the ``capabilities [an interconnected 
VoIP seeks] to provide 9-1-1 and enhanced 9-1-1 service from an entity 
with ownership or control over such capabilities.'' Congress's use of 
the term ``an entity'' instead of ``the entity'' strongly suggests that 
Congress understood that capabilities might be available from multiple 
sources and intended a broad interpretation of the scope of 
``entities'' obligated to provide access to capabilities. The 
Commission therefore interpreted the NET 911 Act to impose obligations 
of access on each of the entities described in Part II.D of the Order, 
including in typical E911 architectures: incumbent LECs, PSAPs and 
local authorities, VoIP Positioning Centers (VPCs), CMRS providers, 
competitive carriers, and the Interim RNA to the extent any of these 
entities has ``ownership or control'' over any capabilities to which 
interconnected VoIP providers have a right of access.
    11. The Commission recognized that in some instances, multiple 
entities may have ownership or control of similar capabilities in the 
same local area. It saw nothing in the NET 911 Act to suggest that only 
certain of those entities would have the obligation to provide access. 
Indeed, if some but not all entities had that obligation, disputes 
would certainly arise over which entities were subject to the Act, 
causing delays in granting interconnected VoIP providers access and 
thwarting Congress's ultimate goal of ``facilitating the rapid 
deployment of IP-enabled 911 and E911 services.'' Finally, the 
Commission recognize that it does not normally regulate some of the 
entities it described in this part of the Order, such as PSAPs and 
VPCs. Yet Congress has imposed a duty on them and instructed the 
Commission to issue regulations to ``ensure that IP-enabled voice 
service providers have the ability to exercise their rights under 
subsection (b).'' As Congress has instructed the Commission to take 
these actions, it has also given the Commission the authority it needs 
to do so.
    12. Rates, Terms, and Conditions. The NET 911 Act also mandates 
that the rates, terms, and conditions under which access to 911 and 
E911 capabilities is provided are to be the same as made available to 
CMRS providers. Under the rules the Commission issued in the Order, 
interconnected VoIP providers may exercise these rights to fulfill 
their obligation to provide 911 and E911 in full compliance with the 
Commission's rules.
    13. As a threshold matter, the Commission found that issuing rules 
of general applicability regarding rates, terms, and conditions best 
fulfills the goals of the NET 911 Act. The rules adopted in the Order 
are specific enough to bring market certainty and clear direction while 
also being flexible enough to ensure that Congress's aims are met in a 
wide variety of circumstances. Contrary to the approach advocated by 
some commenters, the Commission found no indication that Congress 
intended the Commission to issue detailed regulations regarding the 
pricing methodology under which E911 capabilities must be made 
available. Instead, the Commission found it sufficient to specify that 
those rates, terms, and conditions must in all instances be reasonable. 
One indicia of reasonableness will be whether the rates, terms, and 
conditions under which E911 capabilities are made available to 
interconnected VoIP providers are the same as the rates, terms, and 
conditions made available to CMRS providers.
    14. First, the Commission considered the case where a capability is 
in fact provided to CMRS carriers, such that the owner or controller of 
that capability must grant interconnected VoIP providers access to that 
capability. In that case, the statute is clear on its face that the 
capability must be made available ``on the same rates, terms, and 
conditions that are provided to'' a CMRS provider. The Commission 
interpreted the term ``provided'' as used in this provision as 
encompassing not only those capabilities that are actually provisioned 
to a CMRS provider as well as the rates, terms, and conditions under 
which they are provisioned, but also those capabilities that are 
currently offered to a CMRS provider as well as the rates, terms, and 
conditions under which they are offered. The Commission interpreted 
``provided'' broadly to ensure that interconnected VoIP providers are 
able to access the same capabilities that CMRS providers may access on 
the same rates, terms, and conditions that are available to CMRS 
providers.
    15. In addition, if an owner or controller of a capability does not 
provide a capability to CMRS providers but is required to grant 
interconnected VoIP providers access to such capability under the rules 
described in Part III.A of the Order, such access must be provided on 
the rates, terms, and conditions that would be offered to a CMRS 
provider. The Commission did not believe that Congress intended for it, 
within the 90-day timeframe the Commission was given to adopt rules 
implementing the NET 911 Act, to conduct detailed pricing proceedings 
to determine, for each such capability offered by each type of provider 
in various localities around the country, what the exact price for each 
capability would be if it were offered to CMRS providers. Congress 
clearly did intend, however, for the Commission to provide guidance as 
to how the rates, terms, and conditions for these capabilities should 
be determined. To further that intent, minimize disputes over these 
rates, terms, and conditions, and help achieve Congress's ultimate goal 
``[t]o promote and enhance public safety by facilitating the rapid 
deployment of IP-enabled 911 and E911 services,'' the Commission 
provided further guidance. Specifically, if an owner or controller does 
not provide a capability to CMRS providers but is required to give 
interconnected VoIP providers access to such capability under the rules 
described in Part III.A of the Order, such access must be made 
available on the same rates, terms, and conditions that are offered to 
other telecommunications carriers or any other entities. The Commission 
stated that such rates, terms, and conditions are a reasonable proxy 
for the rates, terms and conditions that would be provided to a CMRS 
provider. To the extent an owner or controller of a capability used to 
provide E911 service provides a single capability to more than one CMRS 
provider or other entity, an interconnected VoIP provider that

[[Page 31864]]

requests access to such capability is entitled to the rates, terms and 
conditions provided to any such single other provider.
    16. If an owner or controller of a capability required to be made 
available does not currently make that capability available to any 
other entities, the rates, terms and conditions under which that owner 
or controller must provide access to a requesting interconnected VoIP 
provider must be reasonable, and should be reached through commercial 
negotiation. Given the industry's track record in working diligently 
and on an accelerated time table to implement the VoIP 911 Order and 
the importance all industry participants attach to having a reliable 
and effective 911 and E911 network, the Commission stated that the 
capability owner or controller and the interconnected VoIP provider 
will be able to expeditiously negotiate reasonable rates, terms, and 
conditions for that capability. The Commission clarified that in 
granting interconnected VoIP providers new contractual rights, it did 
not abrogate any existing commercial agreements that interconnected 
VoIP providers may already have reached for access to capabilities for 
the provision of E911 service. Finally, the Commission emphasized that 
all rights to capabilities that the NET 911 Act grants to an 
interconnected VoIP provider are ``for the exclusive purpose of 
complying with * * * its obligations under subsection (a) [i.e. the 
Commission's existing E911 rules].'' The NET 911 Act does not grant, 
and the Commission's rules do not grant, access to capabilities beyond 
what interconnected VoIP providers need to provide 911 and E911 
service, nor does the statute or the Commission's rules grant access to 
capabilities for any purpose other than compliance with the 
Commission's 911 and E911 rules.
    17. Technical, Network Security, and Information Privacy 
Requirements. To protect the security and reliability of the E911 
network, interconnected VoIP providers may obtain access to E911 
capabilities only in compliance with the specific criteria set forth 
below. The safety of our nation's citizens vitally depends upon 
protecting the emergency services network from security threats. In the 
Order, as required by the NET 911 Act, the Commission granted 
interconnected VoIP providers access to E911 capabilities. Expanding 
the range of entities that have access to the E911 network raises new 
challenges. As NENA has said, VoIP technology ``presents new challenges 
and security issues [for 911 service] as it breaks the bond between 
access and service provider characteristics of legacy networks and at 
this time lacks the legislative and regulatory requirements that apply 
to more conventional telephone services.''
    18. Although Congress has granted interconnected VoIP providers 
additional rights to access E911 capabilities, in most cases, the 
Commission did not anticipate significant deviation from current 
practices. Commenters agree that interconnected VoIP providers today 
are successfully using numbering partners and other 911 service 
providers to deliver E911 calls to the appropriate PSAP. For example, 
Vonage reports that for ``98.45% of its customers, Vonage [currently] 
provides the full suite of E911 service'' pursuant to NENA's standard 
and is in the process of obtaining the capabilities it needs to provide 
E911 service for most of the remainder of its customers.
    19. NENA has developed national VoIP E911 requirements, referred to 
as NENA's i2 standard, that are ``designed to ensure that VoIP 9-1-1 
calls are routed and presented in a wireline equivalent manner.'' The 
Commission stated that any interconnected VoIP provider that is in 
compliance with this standard already is coordinating its efforts with 
the other organizational entities responsible for providing E911 
service.
    20. The Commission required interconnected VoIP providers to comply 
with all applicable industry network security standards to the same 
extent as traditional telecommunications carriers when they access 
capabilities traditionally used by carriers. The Commission recognized 
the security of the nation's emergency services network depends on many 
interlocking measures that collectively preserve the integrity of the 
911 system from unauthorized access and use. For instance, in addition 
to the security concerns discussed above, the network elements used to 
provide 911 service must be kept physically secure. The E911 network 
must also be kept secure against unauthorized electronic access, such 
as through hacking. NENA reports that ``[t]he existing Emergency 
services network provides a relatively high degree of security for 
correctness of information, integrity, and authorization of access, 
authenticity/secrecy, and accuracy of information.'' By requiring 
interconnected VoIP providers to comply with the same standards as 
carriers, the Commission was able to expand access to the E911 system 
without compromising network security.
    21. Finally, the Commission's rules contemplate that incumbent LECs 
and other owners or controllers of 911 or E911 infrastructure will 
acquire information regarding interconnected VoIP providers and their 
customers for use in the provision of emergency services. The 
Commission stated it fully expects that these entities will use this 
information only for the provision of E911 service. The Commission 
further clarified that no entity may use customer information obtained 
as a result of the provision of 911 or E911 services for marketing 
purposes.

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 NET 911 Notice in WC Docket 08-171. See 73 FR 50741 
(Aug. 28, 2008). The Commission sought written public comment on the 
proposals in the Net 911 Notice, including comment on the IRFA. The 
Commission received no comments on the IRFA. This Final Regulatory 
Flexibility Analysis (FRFA) conforms to the RFA.

A. Need for, and Objectives of, the Rules

    2. In the Report and Order (Order), the Commission adopted rules 
implementing certain key provisions of the New and Emerging 
Technologies 911 Improvement Act of 2008 (NET 911 Act). The NET 911 
Act, signed into law on July 23, 2008, is designed to ``promote and 
enhance public safety by facilitating the rapid deployment of IP-
enabled 911 and E911 services, encourage the Nation's transition to a 
national IP-enabled emergency network, and improve 911 and enhanced 911 
(E911) access to those with disabilities.'' Congress directed the 
Commission to issue rules implementing certain key provisions of the 
NET 911 Act no later than October 21, 2008. In particular, to 
effectuate the requirement that providers of interconnected voice over 
Internet Protocol (interconnected VoIP) service provide 911 and 
enhanced 911 (E911) service without exception, Congress mandated that 
the Commission issue regulations in this time frame that, among other 
things, ensure that interconnected VoIP providers have access to any 
capabilities they need to satisfy that requirement. In the Order, the 
Commission fulfilled that duty and took steps to ensure that 
interconnected VoIP providers will use the capabilities they gain as a 
result of the Order to provide 911 and E911 in complete accord with the 
Commission's rules.

[[Page 31865]]

    3. Specifically, in the Order the Commission issued rules that give 
interconnected VoIP providers rights of access to any and all 
capabilities necessary to provide E911 from any entity that owns or 
controls those capabilities. The Commission establish a standard to 
determine the rates, terms, and conditions that will apply to that 
access and also restrict interconnected VoIP provider's access to 
capabilities for the sole purpose of providing 911 or E911 service. 
Finally, interconnected VoIP providers must comply with all applicable 
industry network security standards to the same extent as traditional 
telecommunications carriers when they access capabilities traditionally 
used by carriers.

B. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    4. No comments were submitted specifically in response to the IRFA.

C. Description and Estimate of the Number of Small Entities to Which 
Rules Will Apply

    5. 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 SBA.
    6. Small Businesses. Nationwide, there are a total of approximately 
22.4 million small businesses according to SBA data.
    7. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.
    8. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, towns, 
townships, villages, school districts, or special districts, with a 
population of less than fifty thousand.'' Census Bureau data for 2002 
indicate that there were 87,525 local governmental jurisdictions in the 
United States. We estimate that, of this total, 84,377 entities were 
``small governmental jurisdictions.'' Thus, we estimate that most 
governmental jurisdictions are small.
1. Telecommunications Service Entities
    9. Wireline Carriers and Service Providers. 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.
    10. Incumbent LECs. Neither the Commission nor the SBA has 
developed a small business size standard specifically for incumbent 
LECs. The appropriate size standard under SBA rules is for the category 
Wired Telecommunications Carriers. Under that size standard, such a 
business is small if it has 1,500 or fewer employees. According to 
Commission data, 1,311 carriers have reported that they are engaged in 
the provision of incumbent local exchange services. Of these 1,311 
carriers, an estimated 1,024 have 1,500 or fewer employees and 287 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 Order.
    11. Competitive LECs, Competitive Access Providers (CAPs), 
``Shared-Tenant Service Providers,'' and ``Other Local Service 
Providers.'' Neither the Commission nor the SBA has developed a small 
business size standard specifically for these service providers. The 
appropriate size standard under SBA rules is for the category Wired 
Telecommunications Carriers. Under that size standard, such a business 
is small if it has 1,500 or fewer employees. According to Commission 
data, 1,005 carriers have reported that they are engaged in the 
provision of either competitive access provider services or competitive 
LEC services. Of these 1,005 carriers, an estimated 918 have 1,500 or 
fewer employees and 87 have more than 1,500 employees. In addition, 16 
carriers have reported that they are ``Shared-Tenant Service 
Providers,'' and all 16 are estimated to have 1,500 or fewer employees. 
In addition, 89 carriers have reported that they are ``Other Local 
Service Providers,'' and all 89 have 1,500 or fewer employees. 
Consequently, the Commission estimates that most providers of 
competitive local exchange service, competitive access providers, 
``Shared-Tenant Service Providers,'' and ``Other Local Service 
Providers'' are small entities.
    12. Local Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 151 carriers have reported 
that they are engaged in the provision of local resale services. Of 
these, an estimated 149 have 1,500 or fewer employees and two have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of local resellers are small entities that may be affected by 
our action.
    13. Toll Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 815 carriers have reported 
that they are engaged in the provision of toll resale services. Of 
these, an estimated 787 have 1,500 or fewer employees and 28 have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of toll resellers are small entities that may be affected by 
our action.
    14. Payphone Service Providers (PSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
payphone services providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 526 carriers have reported 
that they are engaged in the provision of payphone services. Of these, 
an estimated 524 have 1,500 or fewer employees and two have more than 
1,500 employees. Consequently, the Commission estimates that the 
majority of payphone service providers are small entities that may be 
affected by our action.
    15. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
providers of interexchange services. The appropriate size standard 
under SBA rules is for the category Wired Telecommunications Carriers. 
Under that size standard, such

[[Page 31866]]

a business is small if it has 1,500 or fewer employees. According to 
Commission data, 300 carriers have reported that they are engaged in 
the provision of interexchange service. Of these, an estimated 268 have 
1,500 or fewer employees and 32 have more than 1,500 employees. 
Consequently, the Commission estimates that the majority of IXCs are 
small entities that may be affected by our action.
    16. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees. According to Commission data, 28 carriers have reported that 
they are engaged in the provision of operator services. Of these, an 
estimated 27 have 1,500 or fewer employees and one has more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
OSPs are small entities that may be affected by our action.
    17. Prepaid Calling Card Providers. Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
prepaid calling card providers. The appropriate size standard under SBA 
rules is for the category Telecommunications Resellers. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 88 carriers have reported that they are 
engaged in the provision of prepaid calling cards. Of these, 85 are 
estimated to have 1,500 or fewer employees and three have more than 
1,500 employees. Consequently, the Commission estimates that all or the 
majority of prepaid calling card providers are small entities that may 
be affected by our action.
    18. 800 and 800-Like Service Subscribers. These toll-free services 
fall within the broad economic census category of Telecommunications 
Resellers. This category ``comprises establishments engaged in 
purchasing access and network capacity from owners and operators of 
telecommunications networks and reselling wired and wireless 
telecommunications services (except satellite) to businesses and 
households. Establishments in this industry resell telecommunications; 
they do not operate transmission facilities and infrastructure.'' The 
SBA has developed a small business size standard for this category, 
which is: all such firms having 1,500 or fewer employees. Census Bureau 
data for 2002 show that there were 1,646 firms in this category that 
operated for the entire year. Of this total, 1,642 firms had employment 
of 999 or fewer employees, and four firms had employment of 1,000 
employees or more. Thus, the majority of these firms can be considered 
small. Additionally, it may be helpful to know the total numbers of 
telephone numbers assigned in these services. Commission data show 
that, as of December 2007, the total number of 800 numbers assigned was 
7,860,000, the total number of 888 numbers assigned was 5,210,184, the 
total number of 877 numbers assigned was 4,388,682, and the total 
number of 866 numbers assigned was 7,029,116.
    19. International Service Providers. The Commission has not 
developed a small business size standard specifically for providers of 
international service. The appropriate size standards under SBA rules 
are for the two broad census categories of ``Satellite 
Telecommunications'' and ``All Other Telecommunications.''
    20. The first category of Satellite Telecommunications ``comprises 
establishments primarily engaged in providing point-to-point 
telecommunications services to other establishments in the 
telecommunications and broadcasting industries by forwarding and 
receiving communications signals via a system of satellites or 
reselling satellite telecommunications.'' For this category, a business 
is small if it has $15.0 million or less in average annual receipts. 
Census Bureau data for 2002 show that there were a total of 371 firms 
under this category that operated for the entire year. Of this total, 
307 firms had annual receipts of under $10 million, and 26 firms had 
receipts of $10 million to $24,999,999. Consequently, we estimate that 
the majority of Satellite Telecommunications firms are small entities 
that might be affected by our action.
    21. The second category of All Other Telecommunications ``comprises 
establishments primarily engaged in (1) providing specialized 
telecommunications applications, such as satellite tracking, 
communications telemetry, and radar station operations; or (2) 
providing satellite terminal stations and associated facilities 
operationally connected with one or more terrestrial communications 
systems and capable of transmitting telecommunications to or receiving 
telecommunications from satellite systems.'' For this category, a 
business is small if it has $25.0 million or less in average annual 
receipts. Census Bureau data for 2002 show that for this category there 
were a total of 332 firms that operated for the entire year. Of this 
total, 259 firms had annual receipts of under $10 million and 15 firms 
had annual receipts of $10 million to $24,999,999. Consequently, we 
estimate that the majority of All Other Telecommunications firms are 
small entities that might be affected by our action.
    22. Wireless Telecommunications Service Providers. Below, for those 
services subject to auctions, we note that, as a general matter, the 
number of winning bidders that qualify as small businesses at the close 
of an auction does not necessarily represent the number of small 
businesses currently in service. Also, the Commission does not 
generally track subsequent business size unless, in the context of 
assignments or transfers, unjust enrichment issues are implicated.
    23. Wireless Telecommunications Carriers (except Satellite). The 
SBA has developed a small business size standard for wireless firms 
under the broad category of ``Wireless Telecommunications Carriers 
(except Satellite).'' Under this category, a wireless business is small 
if it has 1,500 or fewer employees. Because the data currently 
available were gathered under previous NAICS codes, the discussion in 
the remainder of this section tracks these formerly used categories.
    24. Under its prior categories, the SBA categorized wireless firms 
within the two broad economic census categories of ``Paging'' and 
``Cellular and Other Wireless Telecommunications.'' For the former 
census category of Paging, Census Bureau data for 2002 show that there 
were 807 firms in this category that operated for the entire year. Of 
this total, 804 firms had employment of 999 or fewer employees, and 
three firms had employment of 1,000 employees or more. Thus, under this 
category and associated small business size standard, the majority of 
firms can be considered small. For the former census category of 
Cellular and Other Wireless Telecommunications, Census Bureau data for 
2002 show that there were 1,397 firms in this category that operated 
for the entire year. Of this total, 1,378 firms had employment of 999 
or fewer employees, and 19 firms had employment of 1,000 employees or 
more. Thus, under this second category and size standard, the majority 
of firms can, again, be considered small.
    25. Cellular Licensees. The SBA has developed a small business size 
standard for wireless firms within the broad economic census category 
``Cellular and Other Wireless Telecommunications.'' Under this SBA

[[Page 31867]]

category, a wireless business is small if it has 1,500 or fewer 
employees. For the census category of Cellular and Other Wireless 
Telecommunications, Census Bureau data for 2002 show that there were 
1,397 firms in this category that operated for the entire year. Of this 
total, 1,378 firms had employment of 999 or fewer employees, and 19 
firms had employment of 1,000 employees or more. Thus, under this 
category and size standard, the majority of firms can be considered 
small. Also, according to Commission data, 434 carriers reported that 
they were engaged in the provision of cellular service, Personal 
Communications Service (PCS), or Specialized Mobile Radio (SMR) 
Telephony services, which are placed together in the data. We have 
estimated that 222 of these are small under the SBA small business size 
standard.
    26. Paging. The SBA has developed a small business size standard 
for the broad economic census category of ``Paging.'' Under this 
category, the SBA deems a wireless business to be small if it has 1,500 
or fewer employees. Census Bureau data for 2002 show that there were 
807 firms in this category that operated for the entire year. Of this 
total, 804 firms had employment of 999 or fewer employees, and three 
firms had employment of 1,000 employees or more. In addition, according 
to Commission data, 281 carriers have reported that they are engaged in 
the provision of ``Paging and Messaging Service.'' Of this total, we 
estimate that 279 have 1,500 or fewer employees, and two have more than 
1,500 employees. Thus, in this category the majority of firms can be 
considered small.
    27. We also note that, in the Paging Second Report and Order, the 
Commission adopted a size standard for ``small businesses'' for 
purposes of determining their eligibility for special provisions such 
as bidding credits and installment payments. In this context, 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. The SBA has approved this 
definition. An auction of Metropolitan Economic Area (MEA) licenses 
commenced on February 24, 2000, and closed on March 2, 2000. Of the 
2,499 licenses auctioned, 985 were sold. Fifty-seven companies claiming 
small business status won 440 licenses. An auction of MEA and Economic 
Area (EA) licenses commenced on October 30, 2001, and closed on 
December 5, 2001. Of the 15,514 licenses auctioned, 5,323 were sold. 
One hundred thirty-two companies claiming small business status 
purchased 3,724 licenses. A third auction, consisting of 8,874 licenses 
in each of 175 EAs and 1,328 licenses in all but three of the 51 MEAs 
commenced on May 13, 2003, and closed on May 28, 2003. Seventy-seven 
bidders claiming small or very small business status won 2,093 
licenses. We also note that, currently, there are approximately 74,000 
Common Carrier Paging licenses.
    28. 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 or less for each 
of the three preceding years, and a ``very small business'' is an 
entity with average gross revenues of $15 million or less 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.
    29. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services (PCS), and specialized mobile radio 
(SMR) telephony carriers. As noted earlier, the SBA has developed a 
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. 
According to Commission data, 434 carriers reported that they were 
engaged in the provision of wireless telephony. We have estimated that 
222 of these are small under the SBA small business size standard.
    30. 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. Subsequent events, 
concerning Auction 35, including judicial and agency determinations, 
resulted in a total of 163 C and F Block licenses being available for 
grant.
    31. Narrowband Personal Communications Services. The Commission 
held an auction for Narrowband PCS licenses that commenced on July 25, 
1994, and closed on July 29, 1994. A second auction commenced on 
October 26, 1994 and closed on November 8, 1994. For purposes of the 
first two Narrowband PCS auctions, ``small businesses'' were entities 
with average gross revenues for the prior three calendar years of $40 
million or less. Through these auctions, the Commission awarded a total 
of 41 licenses, 11 of which were obtained by four small businesses. To 
ensure meaningful participation by small business entities in future 
auctions, the Commission 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. A third 
auction commenced on October 3, 2001 and closed on October 16, 2001. 
Here, five bidders won 317 (Metropolitan Trading Areas and nationwide) 
licenses. Three of these claimed status as a small or very small entity 
and won 311 licenses.
    32. 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

[[Page 31868]]

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 category provides that a small 
business is a wireless company employing no more than 1,500 persons. 
For the census category Cellular and Other Wireless Telecommunications, 
Census Bureau data for 1997 show that 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 
second category and size standard, the majority of firms can, again, be 
considered small. Assuming 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. In addition, limited preliminary census data for 2002 
indicate that the total number of cellular and other wireless 
telecommunications carriers increased approximately 321 percent from 
1997 to 2002.
    33. 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.
    34. 800 MHz and 900 MHz Specialized Mobile Radio Licenses. The 
Commission awards ``small entity'' and ``very small entity'' bidding 
credits in auctions for Specialized Mobile Radio (SMR) geographic area 
licenses in the 800 MHz and 900 MHz bands to firms that had revenues of 
no more than $15 million in each of the three previous calendar years, 
or that had revenues of no more than $3 million in each of the three 
previous calendar years, respectively. These bidding credits apply to 
SMR providers in the 800 MHz and 900 MHz bands that either hold 
geographic area licenses or have obtained extended implementation 
authorizations. The Commission does not know how many firms provide 800 
MHz or 900 MHz geographic area SMR service pursuant to extended 
implementation authorizations, nor how many of these providers have 
annual revenues of no more than $15 million. One firm has over $15 
million in revenues. The Commission assumes, for purposes here, that 
all of the remaining existing extended implementation authorizations 
are held by small entities, as that term is defined by the SBA. The 
Commission has held auctions for geographic area licenses in the 800 
MHz and 900 MHz SMR bands. There were 60 winning bidders that qualified 
as small or very small entities in the 900 MHz SMR auctions. Of the 
1,020 licenses won in the 900 MHz auction, bidders qualifying as small 
or very small entities won 263 licenses. In the 800 MHz auction, 38 of 
the 524 licenses won were won by small and very small entities.
    35. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order, 
we adopted a small business size standard for ``small businesses'' and 
``very small businesses'' for purposes of determining their eligibility 
for special provisions such as bidding credits and installment 
payments. 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. Additionally, a 
``very small business'' is an entity that, together with its affiliates 
and controlling principals, has average gross revenues that are not 
more than $3 million for the preceding three years. An auction of 52 
Major Economic Area (MEA) licenses commenced on September 6, 2000, and 
closed on September 21, 2000. Of the 104 licenses auctioned, 96 
licenses were sold to nine bidders. Five of these bidders were small 
businesses that won a total of 26 licenses. A second auction of 700 MHz 
Guard Band licenses commenced on February 13, 2001 and closed on 
February 21, 2001. All eight of the licenses auctioned were sold to 
three bidders. One of these bidders was a small business that won a 
total of two licenses.
    36. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service. A significant subset of the Rural Radiotelephone Service is 
the Basic Exchange Telephone Radio System (BETRS). The Commission uses 
the SBA's small business size standard applicable to ``Cellular and 
Other Wireless Telecommunications,'' i.e., an entity employing no more 
than 1,500 persons. There are approximately 1,000 licensees in the 
Rural Radiotelephone Service, and the Commission estimates that there 
are 1,000 or fewer small entity licensees in the Rural Radiotelephone 
Service that may be affected by the rules and policies adopted herein.
    37. Air-Ground Radiotelephone Service. The Commission has not 
adopted a small business size standard specific to the Air-Ground 
Radiotelephone Service. We will use SBA's small business size standard 
applicable to ``Cellular and Other Wireless Telecommunications,'' i.e., 
an entity employing no more than 1,500 persons. There are approximately 
100 licensees in the Air-Ground Radiotelephone Service, and we estimate 
that almost all of them qualify as small under the SBA small business 
size standard.
    38. Aviation and Marine Radio Services. Small businesses in the 
aviation and marine radio services use a very high frequency (VHF) 
marine or aircraft radio and, as appropriate, an emergency position-
indicating radio beacon (and/or radar) or an emergency locator 
transmitter. The Commission has not developed a small business size 
standard specifically applicable to these small businesses. 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. Most 
applicants for recreational licenses are individuals. Approximately 
581,000 ship station licensees and 131,000 aircraft station licensees 
operate domestically and are not subject to the radio carriage

[[Page 31869]]

requirements of any statute or treaty. For purposes of our evaluations 
in this analysis, we estimate that there are up to approximately 
712,000 licensees that are small businesses (or individuals) under the 
SBA standard. In addition, between December 3, 1998 and December 14, 
1998, the Commission held an auction of 42 VHF Public Coast licenses in 
the 157.1875-157.4500 MHz (ship transmit) and 161.775-162.0125 MHz 
(coast transmit) bands. For purposes of the auction, the Commission 
defined a ``small'' business as an entity that, together with 
controlling interests and affiliates, had average gross revenues for 
the preceding three years not to exceed $15 million dollars. In 
addition, a ``very small'' business is one that, together with 
controlling interests and affiliates, had average gross revenues for 
the preceding three years not to exceed $3 million dollars. There are 
approximately 10,672 licensees in the Marine Coast Service, and the 
Commission estimates that almost all of them qualify as ``small'' 
businesses under the above special small business size standards.
    39. 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.
    40. 39 GHz Service. The Commission created a special small business 
size standard for 39 GHz licenses--an entity that has average gross 
revenues of $40 million or less in the three previous calendar years. 
An additional size standard for ``very small business'' is an entity 
that, together with 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. The auction of the 2,173 
39 GHz licenses began on April 12, 2000 and closed on May 8, 2000. The 
18 bidders who claimed small business status won 849 licenses. 
Consequently, the Commission estimates that 18 or fewer 39 GHz 
licensees are small entities that may be affected by the rules and 
polices adopted herein.
    41. Wireless Cable Systems. Wireless cable systems use 2 GHz band 
frequencies of the Broadband Radio Service (``BRS''), formerly 
Multipoint Distribution Service (``MDS''), and the Educational 
Broadband Service (``EBS''), formerly Instructional Television Fixed 
Service (``ITFS''), to transmit video programming and provide broadband 
services to residential subscribers. These services were originally 
designed for the delivery of multichannel video programming, similar to 
that of traditional cable systems, but over the