Rural Call Completion, 76218-76241 [2013-29867]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 78, Number 242 (Tuesday, December 17, 2013)]
[Rules and Regulations]
[Pages 76218-76241]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-29867]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[WC Docket No. 13-39; FCC 13-135]


Rural Call Completion

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document the Federal Communications Commission 
(Commission) improves its ability to monitor problems with completing 
calls to rural areas, and enforce restrictions against blocking, 
choking, reducing, or restricting calls. The Report and Order applies 
the new rules to providers of long-distance voice service that make the 
initial long-distance call path choice for more than 100,000 domestic 
retail subscriber lines, counting the total of all business and 
residential fixed subscriber lines and mobile phones and aggregated 
over all of the providers' affiliates (referred to herein as ``covered 
providers''). In most cases, this is the calling party's long-distance 
provider. Covered providers include LECs, interexchange carriers 
(IXCs), commercial mobile radio service (CMRS) providers, and VoIP 
service providers. These rules do not apply to intermediate providers. 
Covered providers must file quarterly reports and retain the call 
detail records for at least six calendar months. The Report and Order 
also allows qualifying providers to certify that they meet the 
conditions for a Safe Harbor that would reduce reporting and retention 
obligations. In addition, the Commission has delegated to the Wireline 
Competition Bureau, in consultation with the Enforcement Bureau, the 
authority to act on requests from qualified providers for waiver of 
these rules. The Report and Order also adopts a rule prohibiting all 
originating and intermediate providers from causing audible ringing to 
be sent to the caller before the terminating provider has signaled that 
the called party is being alerted.

DATES: Effective January 16, 2014 except for Sec.  64.2201 of the 
Commission's rules, which will become effective January 31, 2014, and 
Sec. Sec.  64.2103, 64.2105, and 64.2107 and the information collection 
in paragraph 67 of this Report and Order, which contains information 
collection requirements that have not been approved by Office of 
Management and Budget. The Federal Communications Commission will 
publish a document in the Federal Register announcing the effective 
date of Sec. Sec.  64.2103, 64.2105, and 64.2107.

FOR FURTHER INFORMATION CONTACT: Gregory D. Kwan, Competition Policy 
Division, Wireline Competition Bureau, at (202) 418-1191.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order in WC Docket No. 13-39, FCC 13-135, released on November 8, 
2013. The complete text of this document is available for public 
inspection during regular business hours in the FCC Reference 
Information Center, Room CY-A257, 445 12th Street SW., Washington, DC 
20554. It is also available on the Commission's Web site at https://www.fcc.gov. This summarizes only the Report and Order in WC Docket No. 
13-39; A summary of the Commission's Further Notice of Proposed 
Rulemaking in WC Docket No. 13-39 is published elsewhere in this issue 
of the Federal Register.

Synopsis of Report and Order

I. Introduction

    1. In this Order, we adopt rules to address significant concerns 
about completion of long-distance calls to rural areas. Doing so will 
help ensure that long-distance calls to all Americans, including rural 
Americans, are completed. The record in this proceeding leaves no doubt 
that completion rates for long-distance calls

[[Page 76219]]

to rural areas are frequently poor--whether the call is significantly 
delayed, the called party's phone never rings, the caller hears false 
busy signals, or there are other problems. These failures have 
significant and immediate public interest ramifications, causing rural 
businesses to lose customers, cutting families off from their relatives 
in rural areas, and creating potential for dangerous delays in public 
safety communications in rural areas.
    2. The rules that we adopt today are a critical step to eliminating 
this significant problem by improving the Commission's ability to 
monitor the delivery of long-distance calls to rural areas, aiding 
enforcement action in connection with providers' call completion 
practices as necessary, as well as aiding consumers and industry by 
adopting a rule prohibiting false ring signaling. In the Further Notice 
of Proposed Rulemaking (FNPRM), we seek comment on additional measures 
that may help the Commission ensure a reasonable and nondiscriminatory 
level of service to rural areas.

II. Background

    3. The Commission initiated this rulemaking in February 2013 to 
help address problems in the completion of long-distance telephone 
calls to rural customers. This followed a series of Commission actions 
to address rural call completion concerns over the past several years. 
As discussed in greater detail below, since 2007 the Commission has:
     Adopted the USF/ICC Transformation Order, which, among 
other things, reaffirmed the prohibition on call blocking; made clear 
that carriers' blocking of VoIP-PSTN traffic is prohibited; clarified 
that interconnected and one-way VoIP providers are prohibited from 
blocking voice traffic to or from the PSTN; and adjusted over a period 
of time many terminating switched access charges as part of transition 
to a bill-and-keep regime;
     Issued two Declaratory Rulings clarifying that carriers 
are prohibited from blocking, choking, reducing, or restricting traffic 
in any way, including to avoid termination charges, and clarifying the 
scope of the Commission's prohibition on blocking, choking, reducing, 
or restricting telephone traffic which may violate section 201 or 202 
of the Communications Act of 1934, as amended (the Act);
     Established a Rural Call Completion Task Force to 
investigate the growing problems associated with calls to rural 
customers;
     Held a workshop to identify specific causes of rural call 
completion problems and discuss potential solutions with key 
stakeholders;
     Established dedicated avenues for rural consumers and 
carriers to inform the Commission about call completion problems; and
     Investigated and pursued enforcement of providers not 
complying with the statute and/or our rules, including a consent decree 
as well as an enforcement advisory regarding rural call completion 
problems.

We describe in greater detail the Commission's most significant 
actions, which inform the legal and policy actions that we take in this 
Order.
    4. USF/ICC Transformation Order. On November 18, 2011, the 
Commission released the USF/ICC Transformation Order, which, among 
other things, established a number of new rules requiring carriers to 
adjust, over a period of years, many of their terminating switched 
access charges effective every July 1, as part of a transition to a 
bill-and-keep regime. The Commission capped the vast majority of 
interstate and intrastate switched access rates as of December 29, 
2011. Price cap and rate-of-return carriers were required to make 
comparable reductions to certain intrastate switched access rates in 
2012 and 2013 if specified criteria were met. Beginning in 2014, price 
cap and rate-of-return carriers begin a series of rate reductions to 
transition certain terminating interstate and intrastate switched 
access rates to bill-and-keep. The price cap transition occurs over six 
years and the rate-of-return transition over nine years.
    5. The USF/ICC Transformation Order also re-emphasized the 
Commission's longstanding prohibition on call blocking. The Commission 
reiterated that call blocking has the potential to degrade the 
reliability of the nation's communications network and that call 
blocking harms consumers. The Commission also made clear that the 
general prohibition on call blocking by carriers applies to VoIP-to-
PSTN traffic. Finally, the Commission prohibited call blocking by 
providers of interconnected VoIP services as well as providers of 
``one-way'' VoIP services. The Communications Act defines ``non-
interconnected VoIP service'' as a service that enables real-time voice 
communications that originate from or terminate to the user's location 
using Internet protocol or any successor protocol, requires Internet 
protocol compatible customer premises equipment, and does not include 
any service that is an interconnected VoIP service. 47 U.S.C. 153(36). 
Our use of the term ``one-way VoIP'' in this Order is consistent with 
the definition of ``non-interconnected VoIP service'' in the 
Communications Act, to the extent such service offers the capability to 
place calls to or receive calls from the PSTN.
    6. In addition, the Commission adopted rules to address so-called 
``phantom traffic,'' that is, traffic that terminating networks receive 
that lacks certain identifying information for calls. The lack of such 
basic information to accompany calls has also resulted in calls being 
delivered without the correct caller identification, which is a common 
call quality complaint in rural areas. In the USF/ICC Transformation 
Order, the Commission found that service providers in the call path 
were intentionally removing or altering identifying information to 
avoid paying the terminating rates that would apply if the call were 
accurately signaled and billed. The Commission adopted rules requiring 
telecommunications carriers and providers of interconnected VoIP 
service to include the calling party's telephone number in all call 
signaling, and required intermediate providers to pass this signaling 
information, unaltered, to the next provider in a call path.
    7. 2012 Declaratory Ruling. In 2012, the Wireline Competition 
Bureau issued a declaratory ruling to clarify the scope of the 
Commission's prohibition on blocking, choking, reducing, or restricting 
telephone traffic in response to continued complaints about rural call 
completion issues from rural associations, state utility commissions, 
and consumers. The 2012 Declaratory Ruling made clear that practices 
used for routing calls to rural areas that lead to call termination and 
quality problems may violate the prohibition against unjust and 
unreasonable practices in section 201 of the Act or may violate the 
carriers' section 202 duty to refrain from unjust or unreasonable 
discrimination in practices, facilities, or services. The 2012 
Declaratory Ruling also noted that carriers may be subject to liability 
under section 217 of the Act for the actions of their agents or other 
persons acting for or employed by the carriers. The Bureau stated that 
the practices causing rural call completion problems ``adversely affect 
the ubiquity and reliability of the nation's communications network and 
threaten commerce, public safety, and the ability of consumers, 
businesses, and public health and safety officials in rural America to 
access and use a reliable network.''
    8. The NPRM. In February 2013, the Commission adopted a Notice of

[[Page 76220]]

Proposed Rulemaking (NPRM) seeking comment on proposed reporting and 
data retention requirements. 78 FR 21891, April 12, 2013. The NPRM 
proposed rules requiring facilities-based originating long-distance 
voice service providers to collect, retain, and report to the 
Commission data on call answer rates. The NPRM also proposed rules 
requiring facilities-based originating long-distance voice service 
providers to collect and retain information on call attempts and to 
periodically analyze call completion data and report the results to the 
Commission. The NPRM proposed rules requiring facilities-based 
originating long-distance providers with more than 100,000 retail long-
distance subscribers (business or residential) to file quarterly 
reports that measure the call answer rate for each rural operating 
company number (OCN) to which 100 or more calls were attempted during a 
calendar month, and to report on specific categories of call attempts. 
The NPRM also proposed requiring originating long-distance providers to 
measure the overall call answer rate for nonrural call attempts to 
permit comparisons between long-distance calls in rural versus nonrural 
local exchanges.
    9. Public Notice Seeking Comment on List of Rural OCNs. On April 
18, 2013, the Wireline Competition Bureau released a Public Notice 
seeking comment on which rural OCNs covered providers should include in 
the proposed quarterly reports on call completion performance. 78 FR 
26572-01, May 7, 2013. The Public Notice invited comment on the 
completeness and suitability of a list of rural OCNs compiled by the 
National Exchange Carrier Association (NECA) and posted on NECA's Web 
site.
    10. Enforcement Activity. The Commission's Enforcement Bureau is 
also actively responding to rural call completion problems. In March 
2013, Level 3 Communications, LLC (Level 3) entered into a consent 
decree terminating the Enforcement Bureau's investigations into 
possible violations of sections 201(b) and 202(a) of the Act with 
respect to Level 3's call completion practices to rural areas, 
including its use and monitoring of intermediate providers. On July 19, 
2013, the Enforcement Bureau issued an advisory to long-distance 
providers to take consumer complaints about rural call completion 
seriously. The advisory gave examples of plainly insufficient provider 
responses and warned that ``[g]oing forward, the FCC may take 
enforcement action against providers that submit such patently 
deficient responses to informal complaints.''
    11. In addition to conducting ongoing investigations of several 
long-distance providers, the Commission has been addressing daily 
operational problems reported by rural customers and carriers so that 
incoming long-distance calling to customers of rural incumbent local 
exchange carriers (LECs) is promptly restored. We have established 
dedicated avenues for rural customers and carriers to inform the 
Commission about these call completion problems. A web-based complaint 
intake focuses on the rural call completion problems of residential and 
business customers, instructs such customers how to file complaints 
with the Commission, and links to the Commission's standard 2000B 
complaint form. Separately, a dedicated email intake provides a ``hot 
email line'' for rural telephone companies to alert the Commission of 
systemic problems receiving calls from a particular originating long-
distance provider and facilitates provider-to-provider resolution.
    12. Many key stakeholders acknowledge that call termination issues 
to rural service areas are serious and widespread and have collaborated 
to propose industry solutions. For example, in October 2011, 
stakeholders attended the Commission's Rural Call Completion Task 
Force's workshop to identify and discuss potential solutions. In 2012, 
the Alliance for Telecommunications Industry Solutions (ATIS) released 
the Intercarrier Call Completion/Call Termination Handbook outlining 
standards and practices of the industry relevant to ensuring call 
completion. In August 2013, ATIS and NECA announced a voluntary Joint 
National Call Testing Project offering providers the opportunity to 
test call completion issues identified on calls destined to many areas 
served by rural local exchange carriers. The testing project will 
facilitate cooperative trouble resolution efforts with originating, 
intermediate and terminating carriers. Finally, we note that some 
providers have devoted substantial time and resources to analyzing 
rural call completion performance. We applaud these and other efforts 
by stakeholders and encourage the continued support of the industry to 
undertake further efforts to diagnose problems in call routing, 
cooperate on finding solutions, and adopt best practices aimed at 
solving the rural call completion problem.

III. Discussion

    13. Even with the significant Commission actions described above, 
the record leaves no doubt that the problems of completing calls to 
rural areas, particularly areas served by rural incumbent local 
exchange carriers (ILECs) continue to be frequent and pervasive 
throughout rural America. The inability to complete calls reliably 
threatens public safety and contravenes the public interest. We 
conclude that additional Commission action and enforcement are 
necessary to address these problems.
    14. Scope of the problems. The record indicates that rural call 
completion problems are serious and widespread. NTCA has argued that 
``the call completion epidemic results in `dire consequences' to 
consumers, economic development, and public safety across the nation.'' 
The problems manifest themselves in lengthy periods of dead air on the 
calling party's end after dialing a number, audible ringing tones on 
the calling party's end when the called party's telephone never rings 
at all, false busy signals, inaccurate intercept messages, and the 
inability of one or both parties to hear the other when the call does 
go through. The record contains substantial evidence that these 
problems persist; some state that they are worsening. We also continue 
to receive information on the nature and extent of the rural call 
completion problem. For example, we have received examples of life-
threatening call failures, including a situation where an on-call 
surgeon was unable to receive a call from a hospital for emergency 
surgery and a 911 call center was unable to do emergency call backs. We 
also continue to take in individual complaints from consumers and rural 
telephone companies affected by these issues.
    15. Although some commenters question whether the problems are 
serious or widespread and whether there is a need for Commission 
action, these comments are largely unsubstantiated and are inconsistent 
with the significant evidence and real-world Commission experience to 
the contrary. We find the views of rural carriers and our state 
partners more persuasive, given their direct experience with complaints 
about call completion performance. We therefore find a sufficient basis 
for proceeding with the rules we adopt today, and can revisit these 
rules in the future as warranted by the data we will be collecting, 
which should provide evidence regarding the scope and extent of call 
completion problems over time.
    16. Causes of the Problems. There appear to be multiple factors 
that cause rural call completion problems. Rural associations posit 
that the call completion problems may arise from the manner in which 
originating providers

[[Page 76221]]

set up the signaling and routing of their calls, and that many of these 
call routing and termination problems can be attributed to intermediate 
providers. They argue that least cost routing carriers offer 
terminating services at low rates, and that some least cost routing 
carriers may provide inferior service for a low rate.
    17. One key reason for the increased problems in rural areas is 
that a call to a rural area is often handled by numerous different 
providers in the call's path. Given the particularly high rates long-
distance providers incur to terminate long-distance calls to rural 
rate-of-return carriers, long-distance providers have additional 
incentives to reduce the per-minute cost of calls. For example, the 
disparity between interstate rates can be 5-6 cents per minute for 
rate-of-return areas and just over half a cent per minute for price cap 
areas. As a result, there is greater incentive for the long-distance 
provider to hand off the call to an intermediate provider that is 
offering to deliver it cheaply--and potentially less incentive to 
ensure that calls to rural areas are actually completed properly. The 
prevalence of these problems accords with providers' incentives to 
engage in blocking or degrading traffic, or similar behavior, in an 
effort to minimize their intercarrier compensation payments, which has 
been long recognized by the Commission. While the Commission's 
comprehensive reform of intercarrier compensation will alleviate some 
of these price differences in the long-term, it likely will continue to 
be more costly to complete calls to rate-of-return carriers while the 
transition to bill-and-keep is implemented over the next several years.
    18. The Commission has determined that call blocking is an unjust 
and unreasonable practice under section 201(b) of the Act, and the 
Wireline Competition Bureau has made clear that carriers' rural call 
routing practices that lead to call termination and quality problems 
may violate the prohibition against unjust and unreasonable practices 
in section 201(b) of the Act. In the USF/ICC Transformation Order, the 
Commission extended its longstanding prohibition on call blocking to 
providers of interconnected and one-way VoIP service. We emphasize that 
interconnected and one-way VoIP service providers may violate this 
prohibition if they block, choke, reduce, or restrict traffic on calls 
placed to customers of rural telephone companies.

A. Recording, Retention, and Reporting of Data

1. Scope
    19. Summary. We adopt recording, retention, and reporting 
requirements to substantially increase our ability to monitor and 
redress problems associated with completing calls to rural areas. These 
rules will also enhance our ability to enforce restrictions against 
blocking, choking, reducing, or restricting calls. For the reasons set 
forth below, we find that the recording, retention, and reporting rules 
should apply to providers of long-distance voice service that make the 
initial long-distance call path choice for more than 100,000 domestic 
retail subscriber lines, counting the total of all business and 
residential fixed subscriber lines and mobile phones and aggregated 
over all of the providers' affiliates (referred to herein as ``covered 
providers''). In most cases, this is the calling party's long-distance 
provider. As discussed below, covered providers include LECs, 
interexchange carriers (IXCs), commercial mobile radio service (CMRS) 
providers, and VoIP service providers. The recording, retention, and 
reporting rules we adopt today apply to providers of interconnected 
VoIP service, as that term is defined in section 9.3 of the 
Commission's rules, 47 CFR 9.3, and to providers of VoIP service that 
permits users generally to terminate calls to the PSTN, but not to 
receive calls from the PSTN (one-way VoIP). For ease of reference, in 
this Order, the terms ``VoIP service'' or ``VoIP services'' are 
sometimes used to refer collectively to interconnected VoIP service and 
one-way VoIP service. Finally, we do not apply these rules to 
intermediate providers.
    20. Covered Providers. The NPRM proposed to require facilities-
based, originating long-distance voice service providers to comply with 
recording, retention, and reporting obligations. The NPRM proposed that 
if the originating long-distance voice service provider were not 
facilities-based, the first facilities-based provider in the call-
delivery path would be subject to the rules. The Commission's proposal 
to limit application of the rules to facilities-based providers was 
premised on the belief that those providers would have the greatest 
access to call detail information. In response to the proposed 
categories of covered providers, several commenters urged the 
Commission to clarify or expand what is considered a covered provider, 
noting that the first facilities-based provider in a call path is not 
always the entity with the most direct access to call delivery data. 
Upon reviewing the record, we agree and conclude that the entity with 
the most direct access to call delivery data and the ability to control 
the call path (either directly or via contract) is the appropriate 
entity to record, retain, and report the relevant data. Accordingly, we 
conclude that these rules should apply to providers of long-distance 
voice service that make the initial long-distance call path choice for 
more than 100,000 domestic retail subscriber lines, regardless of 
whether those providers are facilities-based. The 100,000-subscriber-
line figure should include the total of all of a provider's business 
and residential fixed subscriber lines and mobile phones, aggregated 
over all of the provider's affiliates. By ``initial long-distance call 
path choice,'' we refer to the static or dynamic selection of the path 
for a long-distance call based on the called number of the individual 
call. For facilities-based providers, this decision may include 
choosing to deliver the call on the provider's own network. This 
approach will ensure that we impose data-related requirements on the 
providers that have the relevant information. Examples may illustrate 
how this rule would work in practice:
     If originating provider A hands all long-distance calls to 
a single IXC-1 under a 12-month contract, originating provider A is not 
a ``covered provider'' for purposes of these rules. If IXC-1 examines 
the number called in order to select among alternative downstream 
providers LCR-1, LCR-2, and LCR-3, then IXC-1 would be the covered 
provider because it is making the initial route selection decision. The 
intermediate providers LCR-1, LCR-2, and LCR-3 are not covered 
providers in this example.
     If originating provider B is allocating long distance 
calls between IXC-2 and IXC-3 based on geographic origination (e.g., 
different LATAs), volume (e.g., 50% to IXC-2 and 50% to IXC-3), or 
basic jurisdiction (i.e., all intrastate to IXC-2, and all interstate 
and international to IXC-3), and IXC-2 and IXC-3 are making the initial 
route selection among downstream intermediate providers based on the 
called party number, then IXC-2 and IXC-3 are covered providers but 
originating provider B is not. Notably, a covered provider that also 
serves as an intermediate provider for other providers may--but need 
not--segregate its originated traffic from its intermediary traffic in 
its recording and reporting, given the additional burdens such 
segregation may impose on such providers.

[[Page 76222]]

     If originating provider C selects IXC-4 for all long-
distance calls where the called number is east of the Mississippi River 
and selects IXC-5 for long-distance calls where the called number is 
west of the Mississippi River, then originating provider C is making 
the initial routing decision based on the called party's number and is 
a covered provider, and IXC-4 and IXC-5 are not covered providers with 
regard to traffic from originating provider C.
    21. The NPRM proposed that the types of providers covered by these 
rules include LECs, IXCs, CMRS providers, and interconnected VoIP 
service providers. The Commission also sought comment on whether other 
types of providers, such as one-way VoIP service providers, should be 
subject to these rules. We conclude that long-distance voice service 
providers, including LECs, IXCs, CMRS providers, and interconnected and 
one-way VoIP service providers, must comply with these rules when they 
make the initial long-distance call path choice. In order for us to 
fulfill our statutory obligations, these providers must collect, 
retain, and report the information required by these rules.
    22. Commenters generally support the application of the rules to 
LECs, IXCs, and CMRS providers. Although some commenters argue that the 
proposed rules should not apply to interconnected VoIP service 
providers, there is also significant record support for adopting the 
proposal to apply the rules to interconnected VoIP service providers. 
Commission data show that end users are increasingly obtaining service 
from interconnected VoIP providers, such as cable companies. For the 
Commission to address the serious public interest harms, we must 
include the providers that serve approximately one-third of residential 
customers. Indeed, if we do not apply these rules to providers of VoIP 
service, other providers could circumvent the rules by working with a 
VoIP service provider to ensure that the VoIP service provider makes 
the initial long-distance call path choice. Moreover, data and comments 
filed in the record indicate that calls that originated with VoIP 
service providers, like other originating providers, face significant 
rural call completion issues. Accordingly, interconnected VoIP service 
providers that make the initial long-distance call path choice must 
comply with the recording, reporting, and retention rules we adopt 
today.
    23. For similar reasons, we see no basis for excluding one-way VoIP 
providers from the scope of our rules. The Commission has described 
one-way VoIP services as allowing users to receive calls from, or place 
calls to, the PSTN, but not both; here, where we are concerned about 
termination issues, we refer to VoIP services that allow users to place 
calls to the PSTN but not to receive them. One-way VoIP providers have 
significant numbers of subscribers to their services, and some data 
suggest that one-way VoIP usage is increasing. Indeed, there is no 
relevant distinction in our record between ``one-way'' VoIP and 
interconnected VoIP, as the rural call completion problem we are 
addressing here inherently is ``one way''--calls terminating to rural 
areas. The Commission needs data from one-way VoIP providers as well as 
interconnected VoIP providers in order to obtain a complete picture of 
the rural call completion problem and address it effectively.
    24. Affiliated Providers. We note that covered providers may be 
affiliated with other covered providers. To minimize the burden on such 
providers, affiliated providers may record, retain, and report the 
information required herein individually or aggregated to the holding-
company level. To the extent that covered providers choose to file 
individually by affiliate, they may do so in whatever arrangement they 
choose. For example, if three covered providers are affiliated, two of 
those providers may record, retain, and report data together, while the 
third does so individually. Furthermore, we do not consider affiliates 
of a covered provider to be ``intermediate providers'' of that covered 
provider for the purposes of these rules.
    25. Intermediate Providers. The NPRM sought comment on whether we 
should impose recording, retention, and reporting requirements on 
intermediate providers and, if so, how. Some commenters argue that the 
Commission should impose these requirements on intermediate providers 
to provide the Commission with more data in its efforts to identify 
sources of call completion problems and incent intermediate providers 
to ensure high levels of call completion over their networks. Others 
disagree, questioning whether the benefits produced by these additional 
data would justify the burden associated with imposing recording, 
retention, and reporting requirements on a large number of intermediate 
providers.
    26. At this time, we conclude that intermediate providers are not 
required to comply with the recording, retention, and reporting rules 
we adopt today. Because the rules extend to providers that make the 
initial long-distance call path choice, we expect the Commission will 
obtain the data we need to identify and analyze patterns of call 
completion problems. In addition, the Act provides that ``the act, 
omission, or failure of any officer, agent, or other person acting for 
or employed by any common carrier or user, acting within the scope of 
his employment, shall in every case be also deemed to be the act, 
omission, or failure of such carrier or user as well as that of the 
person.'' Although we decline at this time to require intermediate 
providers to comply with these rules, the Enforcement Bureau continues 
to have the authority to investigate and collect additional information 
from intermediate providers when pursuing specific complaints and 
enforcement actions. We also remind intermediate providers that our 
rules already require, within thirty days of the commencement of 
providing services, telecommunications carriers, certain other 
providers of telecommunications, interconnected VoIP service providers, 
and certain non-interconnected VoIP providers to register with the 
Commission and designate agents for service of process in the District 
of Columbia. In the attached FNPRM, we seek comment on addressing 
intermediate providers going forward.
    27. Exception for Smaller Covered Providers. Consistent with the 
NPRM, we require only providers of long-distance voice service that 
make the initial long-distance call path choice for more than 100,000 
domestic retail subscriber lines (counting the total of all business 
and residential fixed subscriber lines and mobile phones and aggregated 
over all of the providers' affiliates) to comply with the recording, 
retention, and reporting rules. Commenters generally supported this 
approach. Although some commenters argue that this threshold should be 
lower, doing so would burden many providers with new obligations 
without significantly improving the data that are filed with the 
Commission. Exclusion of smaller providers should not compromise our 
ability to monitor rural call completion problems effectively. A review 
of fixed and mobile subscription counts reported to the Commission via 
Form 477 reveals that the 100,000-subscriber-line threshold should 
capture as much as 95 percent of all callers. Additionally, many 
providers that have 100,000 or fewer subscriber lines are not covered 
providers because they are reselling long-distance service from other 
providers that make the initial long-distance call path choice. 
Providers that do not meet the 100,000-subscriber-line threshold 
continue to be subject to the prohibition against blocking calls,

[[Page 76223]]

the section 201 prohibition against unjust and unreasonable carrier 
practices, and the section 202 prohibition on unjust and unreasonable 
discrimination. Finally, although we exempt such providers at this 
time, the Enforcement Bureau continues to have the authority to 
investigate and collect additional information from such providers when 
pursuing specific complaints and enforcement actions. The Commission 
will continue to look into complaints from rural LECs and consumers and 
pursue enforcement action where warranted.
2. Legal Authority
    28. The NPRM set out several sources of legal authority that 
support the proposals to require covered providers to retain and report 
call completion data, and sought comment on the conclusion that such 
authority was sufficient to adopt the proposals and ``any additional 
sources of possible authority.'' We conclude that we have ample direct 
authority to adopt this Order and the accompanying rules by virtue of 
sections 1, 4(i), 201(b), 202(a), 218, 220(a), 251(a), and 403 of the 
Act. We also conclude that we have ancillary authority to apply the 
requirements adopted in this Order to VoIP service providers as 
discussed below, to the extent those providers are not otherwise 
subject to our direct authority under the Act.
    29. Direct Authority. As an initial matter, call detail records are 
crucial to the Commission's ability to fulfill its responsibilities 
under section 201 of the Act. As we have previously made clear, 
blocking, choking, reducing, or restricting traffic in any way, 
including to avoid transport and termination charges, generally 
constitutes an unjust and unreasonable practice under section 201(b) of 
the Act. The recording, retention, and reporting rules we adopt today 
will help us identify instances in which long-distance providers or 
their agents may have violated section 201(b) by blocking or otherwise 
restricting or degrading calls placed to rural consumers. Once such 
instances have been identified, we can then intelligently marshal our 
resources. For example, we can use those data to evaluate provider 
performance and to inform enforcement actions, where necessary. We 
anticipate that this prospect of enforcement will help to further deter 
providers from engaging in unjust or unreasonable practices and hence 
reduce call completion problems to customers in rural America. Indeed, 
as providers collect data as required under this Order, many will have 
greater insight into their performance and that of their intermediate 
providers than they have had in the past. These data also will enable 
the Commission to evaluate the need for other steps, whether more 
specific requirements implementing section 201(b), such as specific 
standards regarding call completion performance, or other actions. For 
similar reasons, the records to be reported under our new rules also 
will aid the Commission's efforts to ensure that provider practices, 
facilities, or services do not unjustly or unreasonably discriminate 
against rural localities, which could violate section 202(a).
    30. Our authority to adopt these rules also derives from section 
251(a) because these rules will allow us to ensure that all Americans 
in rural and nonrural areas receive the benefits of interconnection. 
For example, the record reflects that some providers are purchasing 
voice termination services that are of low quality--both in terms of 
quality of service and in terms of the reliability of delivery to 
terminating carriers-- and rely on indirect interconnection with rural 
carriers that is not always reliable. To identify the source of the 
problems in terminating calls--and to assess whether there is a 
potential failure of ``direct or indirect interconnection'' of the sort 
the Commission can address under section 251(a)(1)--the Commission 
needs relevant data. Likewise, insofar as individuals with disabilities 
live in rural areas experiencing call completion problems, these data 
are likely to be important tools in targeting investigations of whether 
long distance providers have configured their networks in ways that do 
not comply with the accessibility requirements adopted under section 
255, as required by section 251(a)(2), and if so, what further actions 
are warranted.
    31. Moreover, the Act provides the Commission with ample authority 
to: (1) Inquire into and keep itself apprised of carriers' business 
management practices; (2) obtain from carriers full and complete 
information necessary to enable the Commission to perform the duties 
for which it was created; and (3) prescribe the form for these records 
and reports. Adopting recording, retention, and reporting rules as 
described below will allow the Commission to better identify patterns 
of rural call completion problems and address them in fulfillment of 
our statutory obligations.
    32. Our actions also advance the goals set out in other provisions 
of the Act. Section 1 of the Act makes clear that the Commission's 
purposes include ``to make available, so far as possible, to all the 
people of the United States . . . a rapid, efficient, Nation-wide, and 
world-wide wire and radio communication service with adequate 
facilities at reasonable charges, for the purpose of the national 
defense, [and] for the purpose of promoting safety of life and property 
through the use of wire and radio communications.''
    33. We disagree with the sole commenter who questioned our 
jurisdiction to apply recording, retention, and reporting requirements 
to intrastate long distance calls. Telephone services are 
jurisdictionally mixed services, and allowing providers to record, 
retain, and report only interstate information would provide an 
incomplete picture of the rural call completion problem and leave us 
poorly equipped to ensure that calls are being properly completed. 
Indeed, to the extent that our data collection will help us diagnose 
precisely where rural call failures occur in the network (and that 
network is used for both intrastate and interstate calls), collecting 
only a partial picture of rural call completion rates may prevent us 
from ensuring that interstate calls are properly being completed. In 
addition, as the Supreme Court has made clear, ``[section] 201(b) 
explicitly gives the FCC jurisdiction to make rules governing matters 
to which the 1996 Act applies,'' which includes matters covered by 
section 251(a). We therefore have authority to adopt the data 
collection, retention, and reporting rules in this Order both for 
interstate and intrastate traffic.
    34. Many commenters support applying the recording and reporting 
obligations to intrastate as well as interstate long-distance calls. 
Our state partners, in particular, strongly agree that we should apply 
our requirements to intrastate calls. We look forward to working with 
our state partners--some of whom may be strained for resources to 
address these problems themselves--to ensure that customers of rural 
carriers do not continue to suffer from poor termination rates.
    35. Ancillary Authority. The Commission has ancillary authority to 
impose these rules on providers of interconnected and one-way VoIP 
services, to the extent that they are not already subject to the direct 
authority just described. Most commenters agree. Ancillary authority 
may be employed, at the Commission's discretion, when the Act ``covers 
the regulated subject'' and the assertion of jurisdiction is 
``reasonably ancillary to the effective performance of [the 
Commission's] various responsibilities.'' Both predicates for ancillary 
authority are satisfied here.

[[Page 76224]]

    36. First, the Act gives the Commission jurisdiction over 
interstate ``communication by wire or radio.'' VoIP service connected 
to the PSTN is clearly such communication, because it involves 
transmission of voice by aid of wire, cable, or other like connection 
and/or transmission of voice by radio. These services are therefore 
covered by the Commission's general jurisdictional grant under Title I.
    37. Second, requiring providers of VoIP service to comply with 
these recording, retention, and reporting requirements is ``reasonably 
ancillary to the [FCC's] effective performance of its statutorily 
mandated responsibilities'' under sections 201(b), 202(a), and 
251(a)(1). The problems that cause us to impose these requirements 
relate to terminating LECs--clearly common carriers providing 
interstate service--that are unable to provide satisfactory service to 
their customers due to the routing practices of other providers 
handling the call, thus leaving these terminating LECs susceptible to 
erroneous complaints that they are engaged in unjust, unreasonable, or 
otherwise unlawful charges or practices under sections 201(b), 202(a), 
or a combination thereof. These LECs offer their customers a telephone 
service that allows the customer to receive long-distance calls from 
anywhere, but due to other providers' routing practices, 
interconnection arrangements, and/or network configurations, calls to 
the rural LECs' customers have experienced significant problems with 
reliability. The rules we adopt in this Order will help clarify where 
the blame lies, alleviating the problem of erroneous complaints lodged 
against terminating rural LECs by helping resolve complaints in an 
expeditious manner and reducing the burden on all parties, including 
rural LECs and the Commission. VoIP service constitutes a significant 
and growing portion of the long-distance telephone market, and 
according to evidence in the record is also causing some terminating 
LECs to be unable to ensure their customers a reasonable quality of 
service. Absent the application of these rules to providers of VoIP 
service connected to the PSTN, terminating LECs may be suspected of 
causing rural customers to experience service problems that in fact 
were caused by VoIP providers or their intermediate providers (and the 
interconnection arrangements between and among these providers), and 
may unfairly be the subject of complaints. The prevention of this 
problem through the periodic reporting of relevant data is reasonably 
ancillary to the effective performance of our duties under sections 
201(b) and 202(a).
    38. In addition, if we do not apply these requirements to providers 
of VoIP service, telecommunications carriers could evade the rules by 
partnering with a VoIP provider in a way that allows the VoIP provider 
to make the initial call routing decision, thereby allowing the carrier 
to circumvent the requirements we adopt today and undermine the purpose 
of those rules. Such a carrier could therefore arrange for low-cost, 
low-quality terminations of its customers' calls to the customers of 
rural LECs without the threat of enforcement action from the 
Commission. For example, there is evidence on the record that, in at 
least one instance, a non-facilities-based reseller makes the initial 
long-distance call path choice. If that reseller making the initial 
long-distance call path choice uses VoIP technology, in the absence of 
recording, retention, and reporting requirements for VoIP providers, 
both it and the customers for which it makes the initial long-distance 
call path choice would avoid these rules, and the Commission would 
receive no data on retail long-distance call attempts made by the 
customers of the providers using the reseller's services. Such 
circumvention would prevent ``the effective performance of [our] 
statutorily mandated responsibilities'' under sections 201(b) and 
202(a); therefore extending our rules to cover VoIP long-distance 
providers and eliminating this opportunity for circumvention is 
``reasonably ancillary'' to the effective performance of our duties for 
this reason as well.
    39. The recording and reporting requirements will also aid the 
Commission in ensuring that VoIP providers fulfill their obligations 
pursuant to the call blocking ban extended to one-way and 
interconnected VoIP service providers in the USF/ICC Transformation 
Order, and the application of the rules we adopt today to providers of 
VoIP service connected to the PSTN is therefore reasonably ancillary to 
the same statutory authority that provided the basis for the relevant 
Commission action in the USF/ICC Transformation Order. For these 
reasons, we conclude that imposing the recording, retention, and 
reporting requirements meets the second predicate for ancillary 
authority.
3. Recording and Retention Requirements
    40. The NPRM proposed to require covered providers to record and 
retain the following information for each long-distance call attempt: 
Calling party number; called party number; date; time of day; whether 
the call is handed off to an intermediate provider and, if so, which 
intermediate provider; whether the call is going to a rural carrier 
and, if so, which rural carrier, as identified by its OCN; whether the 
call is interstate; and whether the call attempt was answered. We 
sought comment on this approach and on the degree to which providers 
typically retain this information in the ordinary course of business. 
We now conclude that these data--as well as certain cause code 
information--are necessary to permit us to identify and redress call 
completion problems.
    41. Covered providers must begin recording the required data on the 
first day of the calendar month that is at least 20 days after the 
effective date of the information collections in these rules, which 
will be announced in the Federal Register upon approval of the 
collections by the Office of Management and Budget (OMB). Thus, for 
example, if the effective date of the information collections as 
announced in the Federal Register is on January 5, providers must begin 
recording the required data on February 1; if the effective date as 
announced is on January 20, providers must begin recording their data 
on March 1. The Wireline Competition Bureau will also issue a public 
notice announcing when providers must begin recording data.
a. Data To Be Recorded and Retained
    42. On balance, the record supports the categories of call attempt 
data proposed in the NPRM. The Rural Associations argue that ``this 
information is or should be readily available to providers since it is 
typically used to calculate bills and [for] call verification as well 
as to confirm charges assessed by other providers for transport and 
termination.'' Although some commenters claim that most carriers do not 
currently retain the proposed call detail information, or retain only 
some of the information, we find that the proposed categories of call 
data are necessary for the Commission to monitor rural call completion 
problems. Having access to call detail records (CDRs) is essential for 
carriers to identify patterns of problems and develop effective, 
targeted solutions. If, for example, these CDRs reveal a particularly 
low call completion rate to a specific rural OCN, this might indicate 
an inaccuracy in that provider's routing tables or the presence of a 
downstream intermediate provider engaged in call blocking. Identifying 
such patterns would be significantly more difficult without recording 
and retaining call

[[Page 76225]]

detail records at the level of granularity required by the rules we 
adopt today. While we are mindful of the burdens, particularly on 
providers that do not already collect or retain this information, we 
find that the information we require is narrowly tailored to give the 
Commission data necessary to analyze the issue and take action to 
address call completion problems.
    43. We also agree with those commenters that encourage the 
Commission to require covered providers to record and retain certain 
signaling cause code information. The information would allow providers 
and the Commission to calculate and evaluate the statistical 
significance of a provider's call answer rate, which is the ratio of 
the number of calls answered to the number of calls attempted. The call 
answer rate provides valuable information for identifying problem areas 
but does not distinguish among categories of calls that are not 
answered. To have a better understanding of the rural call termination 
problems, having cause codes for unanswered calls will allow us to 
distinguish among calls that generate busy signals, calls that ring but 
are not answered, and calls to unassigned numbers, and to identify 
calls that never reach the intended destination. We recognize that 
these data are imperfect--we understand, for example, that user busy 
signaling may in reality reflect network problems--but they will 
improve our ability as well as that of providers to monitor performance 
and narrow in on specific problems. As such, in addition to the eight 
data points proposed in the NPRM, we require covered providers to 
record an indication whether the call attempt was completed to the 
incumbent local exchange carrier but signaled as busy, ring no answer, 
or unassigned number. For most providers, this indication is likely to 
take the form of an SS7 signaling cause code or SIP signaling message 
code associated with each call attempt.
    44. In contrast, we disagree with commenters that encourage the 
Commission to require covered providers to record and retain post-dial 
delay. Because the retention and reporting of average post-dial delay 
information is of limited utility, and the accumulation and reporting 
of useful post-dial delay data by rural OCN is complex, we decline to 
add this category of call detail information to the recording and 
retention requirements.
    45. Interstate and Intrastate Call Data. We require covered 
providers to record data for all domestic long-distance calls, 
regardless of whether the calls are interstate or intrastate, and to 
report data on interstate and intrastate calls separately. To identify 
the source of problems and take appropriate action, we need complete 
data. Indeed, several state entities support the Commission's 
collection of interstate and intrastate call data as a positive step 
for monitoring rural call completion problems.
    46. While we considered providing greater flexibility to providers 
to choose whether to record and report data for interstate and 
intrastate call attempts separately or together, we decide that having 
consistent data sets across providers is necessary to a clear analysis 
of rural call completion problems. For example, if we were to compare 
the performances of various providers in completing calls to a 
particular rural destination, it would be important to know that the 
performances we were comparing included the same types of calls (e.g., 
interstate, intrastate, or both). In addition, inconsistent data could 
potentially mask problems that consumers are actually experiencing, if 
the call volume for one category is substantially higher than the 
other. We will also be better able to advise our state partners of 
relevant problems within their states. While the record suggests that 
distinguishing between interstate and intrastate calls may require some 
providers to make adjustments to their systems, we believe these 
adjustments are warranted so that we can quickly and efficiently 
identify and pursue any problems.
    47. One commenter suggests that the Commission should limit the 
requirements to interstate calls so that intrastate long-distance 
providers will not be burdened by duplicative or conflicting state 
requirements. While some states are acting to address rural call 
completion problems, we are not aware of any overlap or conflict with 
the rules we adopt today. Indeed, we believe that these rules will help 
states monitor and address rural call completion problems too, and also 
enable them to address rural call completion problems with us jointly. 
Thus, we disagree that collecting intrastate call information will be 
duplicative of state requirements. To the extent that covered providers 
identify areas where the requirements we adopt today duplicate or 
conflict with state commission regulation, we will consider those 
specific circumstances when they are brought to our attention.
b. Categories of Call Attempts To Be Recorded
    48. The NPRM proposed to categorize long-distance call attempts by 
type of originating and terminating provider. The NPRM proposed that 
the data collection requirements cover, at a minimum, the following 
categories of long-distance call traffic: Originating provider to rural 
telephone company (including rural CLEC), originating provider to 
nonrural LEC (including nonrural CLEC), first facilities-based provider 
to rural telephone company (including rural CLEC), and first 
facilities-based provider to nonrural LEC (including nonrural CLEC). 
The NPRM sought comment on whether all these proposed categories are 
necessary and whether other categories of calls should also be 
included.
    49. We conclude that the only call attempts that need to be 
retained are those to incumbent LECs that are rural telephone 
companies, as identified by OCN. Evidence indicates that the rural call 
completion problems are largely confined to such carriers; one reason 
may be that rate-of-return carriers have terminating access rates tend 
to be higher than those of other carriers. In addition, we note that 
originating providers process substantially more calls to nonrural 
areas than to rural areas each day--according to Verizon, 89.5 percent 
of long-distance calls may be to nonrural destinations. Thus requiring 
covered providers to retain records only for calls to rural incumbent 
LECs may substantially reduce the burden of compliance. Finally, we are 
unaware of any complaints that the list of proposed rural OCNs on which 
the Commission sought comment did not include rural competitive LECs. 
Indeed, NTCA agrees that so long as we retain the data for calls to 
rural incumbents, there is no need to maintain that same data for calls 
to nonrural carriers.
    50. We disagree with the commenter that argues we should include 
calls that terminate to CMRS subscribers. Evidence indicates that calls 
to CMRS customers are unlikely to suffer from the completion problems 
affecting long-distance calls to rural wireline telephone subscribers 
because calls to CMRS subscribers normally do not incur high 
termination access charges in rural areas. Moreover, calls that 
terminate to CMRS customers have not been the subject of the same or 
similar volume of complaints as have calls to rural LECs. Therefore, we 
decline to include calls that terminate to CMRS subscribers in the 
categories of call attempts to be recorded and retained.
    51. Calls delivered on-network. One commenter asserts that 
intraLATA toll traffic and interLATA traffic carried on its own network 
and handed off directly by the originating provider to the terminating 
LEC should be excluded

[[Page 76226]]

because this traffic would not likely cause call completion issues. 
Even if this traffic would incur fewer call completion issues, we 
decline to exclude this traffic because it provides an important 
benchmark for issue-free performance. This is especially true in 
instances where a provider may be using both on-net and off-net routes 
to deliver calls to the same terminating provider.
    52. Autodialer Traffic. The NPRM acknowledged that some providers 
may handle substantial amounts of autodialer traffic on behalf of 
business customers who may have call completion expectations and 
capacity requirements that differ from those of residential and 
business callers. The Commission noted, for example, that an autodialer 
may be programmed to hang up before a call attempt can be answered by 
voicemail or an answering machine. We thus sought comment on whether 
such traffic can be reliably identified and, to the extent that it can 
be identified, whether it should be excluded from the recording and 
retention requirements.
    53. Some commenters indicate that they can reliably identify retail 
autodialer traffic because it is delivered on a dedicated connection. 
Another commenter, however, argues that such traffic cannot be reliably 
identified. To the extent that it can be identified, several commenters 
suggest that autodialer traffic should be excluded because it has the 
potential to skew call completion results. One commenter suggests that 
the Commission should only allow covered providers to exclude 
autodialer traffic to the extent that they can identify and segregate 
emergency autodialer call attempts, while another commenter argues that 
all autodialer traffic should be included in the recording and 
retention requirements, particularly given concerns about completion of 
important autodialed emergency alert calls.
    54. While we agree that there are characteristics unique to 
autodialer traffic that may make it likely to skew call completion 
performance results, the record in this proceeding is unclear on the 
degree to which providers can reliably identify and segregate this 
traffic when recording their long-distance call attempts. We are 
confident that the impact of autodialer traffic can be accounted for 
and will not undermine the reliability of the data for our purposes. 
For these reasons, we require covered providers to include autodialer 
traffic in their recording, retention and reporting. Covered providers 
may, however, submit separate calculations in their reports to the 
Commission that segregate autodialer traffic from other traffic, 
accompanied by an explanation of the method the provider used to 
identify the autodialer traffic. This approach should help the 
Commission examine the effects of autodialer traffic on call completion 
rates and the degree to which those effects are magnified in more 
sparsely populated rural numbering blocks, as well as to identify more 
effective means of segregating this traffic.
c. Inclusion or Exclusion of Certain Call Attempt Types
    55. The NPRM sought comment on the feasibility and appropriateness 
of including or excluding certain types of call attempts from the 
recording and retention requirements. For the reasons set forth below, 
we include call attempts of very short duration and exclude call 
attempts handed back to an upstream provider and call attempts to toll-
free numbers.
    56. Calls of Short Duration. The NPRM sought comment on whether 
calls of very short duration, such as those lasting for less than two 
seconds, should be excluded from the recording and retention 
requirements. Some commenters encourage the Commission to include these 
calls while others contend that we should exclude these calls ``because 
they are often wrong numbers, are made by mass dialers, and/or do not 
provide the called party ample time to answer.'' We find that it is 
appropriate to include calls of short duration. While there are myriad 
reasons why a call may be very brief, a short call could reflect an 
inability to complete a call to the intended called party, a dropped 
call, poor call quality, or that the calling party hung up just as the 
called party answered, all of which are relevant to the issues the 
Commission is attempting to address. We thus conclude that calls of 
very short duration should be included in the recording and retention 
requirements. Covered providers may submit an explanation for any 
apparent anomalies when they submit their reports.
    57. Calls Handed Back. The NPRM proposed to exclude call attempts 
that are handed back to the upstream provider in order to avoid double-
counting of the same phone call, and sought comment on the feasibility 
and appropriateness of doing so. The record strongly supports the 
proposal and several commenters contend that it is ``easily 
achievable,'' while CTIA claims that excluding these attempts will 
require the development of new systems to identify these calls.
    58. We find that excluding call attempts handed back to the 
upstream provider is both appropriate and practicable. To obtain a fair 
measure of total call attempts, we find it appropriate to exclude call 
attempts handed back to the upstream provider from the recording and 
retention requirements if the upstream provider makes further attempts 
to complete the call, whether on its own network or through a different 
intermediate provider. Covered providers should confirm that they have 
excluded such hand backs when reporting their results. Inteliquent 
observes that some providers, especially CMRS providers, are ``unable 
to take back a call that an intermediate provider is unable to 
complete.'' Our understanding is that calls are not handed back to 
originating providers in such cases, and these rules would not apply as 
there are no calls that are handed back and no new systems for 
detecting calls handed back would be required. Under those 
circumstances, there is no risk of double counting a single call 
attempt, so there is no need for CMRS providers to develop new systems 
to properly account for such calls.
    59. Toll-Free Numbers. The NPRM sought comment on whether calls to 
toll-free numbers can be reliably identified and excluded. Some 
commenters argue that calls to toll-free numbers should be excluded, 
noting that in many instances it is the toll-free service provider, and 
not the originating service provider, that controls the routing of 
those call attempts. However, other commenters contend that calls to 
toll-free numbers should not be excluded from the recording and 
retention requirements.
    60. We conclude that calls to toll-free numbers should be excluded. 
In many instances, the originating provider has no control over the 
routing or the quality of call attempts to toll-free numbers, and to 
include these call attempts in the recording and retention requirements 
would require covered providers to include data on call attempts for 
which they can take no remedial steps in the event of completion 
problems. We thus exclude call attempts to toll-free numbers from the 
recording and retention requirements.
d. Retention Period
    61. The NPRM proposed that covered providers retain call detail 
records in a readily retrievable form for at least six calendar months. 
We find that the six-month retention period best balances the 
Commission's need for access to these data in support of its efforts to

[[Page 76227]]

eliminate rural call completion problems, including enforcement 
actions, with the burden on providers associated with compliance. Some 
commenters support the six-month retention period, emphasizing the 
utility of the recording and retention requirements in the Commission's 
efforts to identify patterns of rural call completion problems and take 
enforcement action where appropriate. Others urge us to adopt a longer 
or shorter retention period.
    62. A six-month retention period is consistent with our decision to 
require quarterly reporting to the Commission. If we were to adopt a 
shorter retention period, such as the three months suggested by some 
commenters, the records underlying the first month reflected in the 
report might have been purged before the Commission had a reasonable 
opportunity to review the quarterly report. Alternatively, if the 
Commission adopted a shorter retention period, it likely would need to 
require more frequent reporting to provide time to review reports 
before covered providers purged call records summarized in the report. 
This increased reporting frequency, in turn, would increase the burden 
on covered providers. Thus we conclude that a six-month retention 
period (and quarterly reporting requirements) strikes the appropriate 
balance between the benefit of better ensuring satisfactory levels of 
call completion to rural areas and any associated burdens on covered 
providers.
    63. Some commenters argue that the proposed six-month retention 
period is too burdensome, both in terms of up-front software and 
hardware costs required to develop the capability to retain this volume 
of data in a readily retrievable form, and in terms of ongoing 
personnel and systems costs associated with administering a data 
retention program. These commenters characterize these up-front and 
ongoing costs as exceeding any benefits associated with a six-month 
retention period. As other commenters point out, however, covered 
providers already collect, in the ordinary course of business, much if 
not all of the call data to be retained.
    64. We disagree with those commenters who contend that the 
development, storage, and personnel costs associated with the six-month 
retention period are too burdensome relative to any benefits resulting 
from the data retained. A number of potentially covered providers 
appear to already have in place the capability of complying with these 
rules. We also note that Sprint's unsubstantiated contention that the 
proposed rules will cost billions of dollars industry-wide is based on 
several erroneous assumptions. For example, Sprint's assertion that the 
rules will apply to ``hundreds or thousands of other originating 
carriers'' does not reflect the fact that our rules will apply only to 
providers that make the initial long-distance call path choice for more 
than 100,000 domestic retail subscriber lines. In addition, the 
retention obligation applies only to call attempts to incumbent LECs 
that are rural telephone companies, which reduces the burden on covered 
providers. We therefore find that imposing a six-month retention period 
is not unduly burdensome, relative to the significant harm of call 
completion problems and the expected benefits of retaining the data and 
having access to the data underlying the periodic reports.
4. Reporting Requirements
    65. We require covered providers to submit a certified report to 
the Commission once per calendar quarter that includes for each full 
month in that quarter: (1) For each rural OCN, the OCN, the state, the 
total number of attempted interstate calls, the number of attempted 
interstate calls that were answered, and the number of attempted 
interstate calls that were not answered, reported separately for call 
attempts signaled as busy, ring no answer, or unassigned number; (2) 
the same information described in (1), but for intrastate calls; (3) 
the same information regarding attempted interstate calls described in 
(1), but for nonrural OCNs in the aggregate; and (4) the same 
information regarding attempted intrastate calls described in (2), but 
for nonrural OCNs in the aggregate. Using these data, we will calculate 
the percentage of calls answered (the call answer rate) and the 
percentage of calls completed to the terminating provider regardless of 
whether answered or unanswered by the user (the network effectiveness 
ratio). We will also calculate the totals and values for the rural OCNs 
in the aggregate. The categories of call attempts and what constitutes 
a call attempt are addressed above in section III.A.3. As proposed in 
the NPRM, the reports will be submitted in electronic form using a 
template specified by the Commission.
    66. In Appendix C, attached to the Report and Order, we provide a 
template of the mandatory report in the form of an electronic 
spreadsheet that will be filed with the Commission each quarter. As 
noted above, covered providers must include autodialer traffic in their 
reports, but they may submit separate calculations that segregate 
autodialer traffic from other traffic, accompanied by an explanation of 
the method the provider used to identify the autodialer traffic. Before 
any reports are due, the Wireline Competition Bureau will release a 
public notice that explains the filing mechanism in detail. Bureau 
staff will work with providers to ensure that the providers have the 
tools they need to complete and file the form in the least burdensome 
manner possible. Because the reporting requirements are an information 
collection, no reports will be required until the collection has been 
approved by OMB under the Paperwork Reduction Act. The effective date 
of the information collections in these rules will be announced in the 
Federal Register, and covered providers must begin recording the data 
included in the reports they file with the Commission on the first day 
of the calendar month that is at least 20 days after the effective 
date.
    67. Originating long-distance voice service providers that do not 
make the initial long-distance call path decision for more than 100,000 
domestic retail subscriber lines are not required to comply with these 
recording and reporting requirements. Rather, the entity or entities 
that make the initial long-distance call path decision for calls from 
those providers' end-user customers must record and report data for 
those calls. To address rural call completion problems, it is important 
to ensure that call attempts from all originating long-distance 
providers that have more than 100,000 domestic retail subscriber lines 
but do not make the initial long-distance call path choice are 
accounted for in the reports we receive. Accordingly, we require all 
originating long-distance voice service providers that have more than 
100,000 domestic retail subscriber lines but that, for reasons set 
forth in this paragraph, are not required to file quarterly reports to 
file a one-time letter in WC Docket No. 13-39 explaining that they do 
not make the initial long-distance call path choice for more than 
100,000 long-distance voice service subscriber lines and identifying 
the long-distance provider or providers to which they hand off their 
end-user customers' calls. This letter must be submitted to the 
Commission by the date on which recording and retention is required to 
begin, and a copy must be submitted simultaneously to each provider 
identified in the letter as having reporting responsibility.
5. Call Answer Rate and Related Information
    68. The NPRM proposed to require that providers report the call 
answer

[[Page 76228]]

rate for each rural OCN, for all rural OCNs in the aggregate, and for 
nonrural OCNs in the aggregate, and report the call answer rates 
separately for interstate and intrastate calls. After reviewing the 
record, we require covered providers to report data that will allow the 
Commission to calculate the call answer rate, rather than requiring 
them to report the call answer rate itself. We also require covered 
providers to report data regarding unanswered calls. Specifically, we 
require covered providers to report, for each rural OCN and for 
nonrural OCNs in the aggregate but separated by interstate and 
intrastate call attempts: (a) The total number of call attempts; (b) 
the number of answered calls; (c) the number of call attempts that 
result in ``busy'' code; (d) the number of call attempts that result in 
a ``ring no answer'' code; and (e) the number of call attempts for 
which the called number was reported to be unassigned. Collecting these 
data points individually will enable the Commission to calculate--for 
each rural OCN, for all rural OCNs in the aggregate, and for nonrural 
OCNs in the aggregate--both the call answer rate and the network 
effectiveness ratio (NER), and will provide the Commission with better 
insight into the reasons why calls are not answered or not reaching 
their destinations. We emphasize that because the report includes data 
for both rural and nonrural call attempts, covered providers must file 
reports even if they deliver no calls to rural OCNs.
    69. The call answer rate that the NPRM described, which divides the 
number of calls answered by the total number of call attempts, is 
similar to the answer/seizure ratio (ASR), the analogous TDM voice 
network metric, which is often ``used as a means of identifying 
possible changes in performance of a service.'' Using these data, we 
can calculate call answer rates, and thus the data are a valuable 
metric in assisting the Commission in comparing performance across 
providers to uncover the source of rural call completion problems. 
Indeed, the call answer rate is a reasonably reliable measure because, 
for many users, the answer signaling message generates a billing 
record.
    70. Several commenters urge the Commission to require covered 
providers to report the NER in addition to the call answer rate. One 
commenter notes that call answer rates may differ based on local 
adoption rates of voice-mail service, answering machines, and fax 
machines and observes that because ``ring no-answer'' and ``end user 
busy'' calls are treated the same as answered calls in calculating the 
NER, it may be superior to the call answer rate. Some commenters go 
further to propose that we require providers to report only the NER, 
instead of the call answer rate. Other commenters disagree and assert 
that the Commission should not require covered providers to report the 
additional call data that has been suggested because it would be too 
burdensome and potentially inaccurate.
    71. After reviewing the record, we agree with commenters that we 
should require providers to report information beyond the call answer 
rate. As noted above, we require providers to retain certain cause code 
information from which providers and the Commission can calculate the 
NER as well as certain specific percentages regarding unanswered calls, 
such as the percent of call attempts that resulted in a busy signal. 
While we agree that additional data will be useful in identifying the 
causes of rural call completion problems, we do not agree with 
commenters who suggest that we should require reporting of the NER in 
lieu of the call answer rate. First, the call answer rate is the data 
point least susceptible to variations in data reporting or to 
differences in the quality or accuracy of signaling: The called party 
either answered the call or did not answer the call. The NER, by 
contrast, standing alone and viewed only from the originating 
provider's perspective, does not similarly validate whether the call 
ultimately reached its destination. For example, the NER calculation is 
dependent on reliable signaling--because it treats ``user'' cause code 
signals the same as a completed call, any incorrect or falsified 
signals could mask problems such as looping or intentional blocking 
within the network while maintaining a high NER. For instance, busy 
signals are sometimes injected by intermediate providers, rather than 
handing back the call when they cannot find a route. Accordingly, we 
require covered providers to report data that will allow us to 
calculate the NER in addition to the call answer rate. In Appendix C, 
attached to the Report and Order, we provide a specific template that 
covered providers will use in reporting their data, which will capture 
the information described above while accommodating differences in the 
specific cause codes or other data that providers may have, to give 
them flexibility to report such data based on their own network 
configurations.
    72. ``Answered call.'' The NPRM defined the term ``answered call'' 
to mean ``a call that is answered by the called party, including by 
voicemail service, facsimile machine or answering machine.'' One 
commenter recommends that we expand the definition of ``answered call'' 
to mean ``a call that was answered by or on behalf of the called party 
(including calls completed to devices, services or parties that answer 
the call such as an interactive voice response, answering service, 
voicemail or call-forwarding system or any such system that cause the 
network to register that the terminating party has gone off hook).'' We 
adopt this recommendation, with some modification, because we conclude 
it is more comprehensive. Thus the term ``answered call'' means a call 
that was answered by or on behalf of the called party (including calls 
completed to devices, services or parties that answer the call such as 
an interactive voice response, answering service, voicemail or call-
forwarding system), causing the network to register that the 
terminating party is prepared to receive information from the calling 
user.
a. Reporting by Operating Company Number
    73. We require each covered provider to report monthly information 
for each rural OCN to which the provider attempted to deliver calls. As 
the NPRM explained, it is necessary to measure performance at the 
individual rural incumbent LEC level, as identified by OCN, to ensure 
that poor performance to any individual rural incumbent LEC is not 
masked, as it otherwise would be by averaging together calls to all 
rural incumbent LECs, or averaging call data for rural and nonrural 
areas. Some commenters support reporting the data for each rural 
operating company as proposed, and several covered providers state that 
they can readily satisfy a requirement of reporting for each rural 
operating company. As noted above, the Commission proposed a list of 
rural OCNs, to be maintained by NECA, for which call completion 
performance must be recorded, retained, and reported, and it sought 
comment on the completeness of the list and its suitability for use 
upon adoption of the rules proposed in the NPRM. We received no comment 
opposing the use of this list or arguing that it was overinclusive or 
underinclusive in any way, and we believe that the proposed list will 
provide the Commission with the data we need to achieve the objectives 
identified in this Order. Therefore, we conclude that covered providers 
must use the rural OCN list as proposed in the List of Rural OCNs 
Public Notice. To further improve administration of the recording and 
reporting process, the Wireline Competition Bureau will release a

[[Page 76229]]

public notice shortly after release of this Order providing a list, 
also compiled and maintained by NECA, of OCNs associated with incumbent 
LECs that are not rural telephone companies; covered providers must use 
this list to compile the data for nonrural call attempts that must be 
recorded and reported to the Commission under these rules. Once the 
information collections in the Order become effective, we direct NECA 
to update the lists of rural and nonrural OCNs annually and provide 
them to the Wireline Competition Bureau in time for the Bureau to 
publish the lists no later than November 15. For purposes of complying 
with the recording and reporting rules adopted herein, those lists will 
define the rural OCNs and nonrural OCNs at issue for the following 
calendar year.
    74. Other commenters support the proposed reporting while 
suggesting that additional data should also be reported. We find that 
the data that will be reported under this Order should be sufficient to 
enable the Commission to analyze and address rural call completion 
problems, and thus we do not expect the benefits of reporting the 
proposed additional data to outweigh the burdens of doing so.
    75. Some commenters indicate that they do not categorize calls by 
terminating OCN and that to do so would be burdensome. We are not 
convinced that the requirement is unreasonable or overly burdensome. To 
make the routing selection for a call, a provider typically begins with 
the same level of identification of the called number. As we have 
noted, several originating providers already categorize calls by OCN in 
order to analyze their performance to rural areas. Indeed, these data 
seem essential to providers for distinguishing rural and nonrural calls 
and performance, the very problem we seek to address through this 
proceeding. We understand that there are several commercial reference 
databases available for identifying the OCNs for all domestic telephone 
numbers. We thus find that any burden to these covered providers is 
outweighed by the importance of this information to meeting our 
statutory obligations.
b. Reporting for OCNs With 100 Attempts or More
    76. The NPRM proposed that covered long-distance providers be 
required to report the call answer rate for those rural OCNs to which 
100 or more calls were attempted during the month, and also the call 
attempt and answer data on which the calculation is based. Some 
commenters have proposed that we increase the threshold to as many as 
1,000 attempts per month to limit the number of OCNs being reported, 
and others proposed substantially reducing the threshold, including 
removing the threshold completely.
    77. We agree with the commenters who recommend that we eliminate 
the minimum calls per month threshold for reporting by rural OCN. As 
some commenters observe, all attempts have to be counted by OCN before 
a provider can then exclude those below a threshold from the submitted 
report and it is less burdensome to simply report complete results for 
all OCN results than it is to take the additional step of applying a 
threshold before doing so. In addition to being less burdensome on 
covered providers, this adjustment will permit the Commission to more 
reliably study data aggregated across all providers for an individual 
OCN. The Commission will weigh the statistical significance of the data 
on OCNs with small numbers of call attempts per month that it will 
likely receive from covered providers in their individual reports.
c. Reporting for Peak Periods Only
    78. The NPRM asked whether reports should cover all call attempts 
or just those attempted in some peak period, such as between noon and 
6:00 p.m. Eastern time. Commenters generally opposed limiting call 
attempts to those made during a peak period. The Rural Associations 
observe that ``[l]imiting reporting to peak hours suggests call 
failures are attributable solely to network congestion.''
    79. We conclude that we will obtain the most informative data by 
collecting data on all call attempts, rather than attempts during a 
peak period. While we recognize that a disproportionate percentage of 
call failures may be attributable to intermediate providers whose 
facilities are poorly engineered or inadequately sized for loads 
occurring during peak hours, there is little support in the record for 
limiting reporting to peak periods and strong support for requiring 
reporting that covers all call attempts. To the extent that a covered 
provider requires data on peak periods data to analyze call completion 
problems, the provider can extract that information from the data it 
collects on all calls.
d. Reporting Monthly Measurements
    80. The NPRM proposed that the call answer rates for rural OCNs be 
calculated over a month-long period, asked if a different measurement 
period would be more appropriate, and asked whether the nature of 
chronic call routing failures might be such that measurement data 
analyzed monthly masks problems that, for example, a weekly measurement 
period would better capture.
    81. Comments vary widely on the approach to take. One carrier 
states that it can gain significant insight from a one-day snapshot 
while another recommends that the measurement period should be the 
whole quarter. Other commenters propose collecting data over a three-
day period each month or a peak-period measurement during one sample 
week each month. One commenter asserts that a weekly measurement period 
would be more likely to capture intermittent problems. Other commenters 
accept the month-long measurement period and some oppose reducing the 
reporting interval to less than a calendar month. Two commenters state 
that they are comfortable with using a monthly measurement period 
initially, while noting that the Commission could reduce the period in 
the future if one month proves inadequate.
    82. We adopt the proposed monthly measurement interval. As we 
develop experience, we may reconsider this decision. At present, the 
record indicates that monthly measurements are reasonably calculated to 
provide a reasonable snapshot of performance. We again note that for 
problem identification and analysis purposes, providers can extract 
data for smaller time spans, such as weekly figures, from the complete 
set of data they collect.
e. Timing and Frequency of Reports
    83. We proposed in the NPRM that reports be filed quarterly with 
the Commission and asked on what dates they should be filed. Several 
commenters support reporting no more frequently than quarterly if 
reporting rules are adopted. Other commenters recommend that call 
attempt data be reported monthly in the interest of timely reporting of 
problems. Another commenter concerned about the timeliness of reporting 
recommends that covered providers submit three ``rolling'' months of 
data once a month.
    84. Some parties raise concern that reporting more frequently than 
quarterly would be unduly burdensome. To minimize the burden while 
providing the Commission with sufficient information, we adopt a 
quarterly reporting interval. Concerning when the reports should be 
filed, we agree with commenters that assert that once reporting systems 
and procedures are deployed, they should be able to produce the 
quarterly electronic spreadsheet submission before the end

[[Page 76230]]

of the following calendar month. Therefore, we conclude that quarterly 
reports will be due on February 1 (reflecting monthly data from October 
through December), May 1 (reflecting monthly data from January through 
March), August 1 (reflecting monthly data from April through June), and 
November 1 (reflecting monthly data from July through September) of 
each year.
6. Safe Harbors
    85. The NPRM proposed two safe harbors by which providers could 
reduce their obligations under the data reporting and retention 
obligations. The first safe harbor was described as the ``Managing 
Intermediate Provider Safe Harbor.'' Under this safe harbor, as 
proposed, a provider could have no more than two intermediate providers 
in a given call path before the call reaches the terminating provider. 
The second safe harbor, described as the ``Monitoring Performance Safe 
Harbor,'' would provide some relief from the proposed rules to 
providers meeting certain performance standards. We adopt the Managing 
Intermediate Provider Safe Harbor in part, and to create incentives for 
providers to improve their rural call completion performance 
immediately, we provide a means for providers that have taken 
significant steps and adopted measures to ensure calls to rural areas 
are being completed, such as adoption of industry best practices, to 
seek a waiver of these data-related obligations. We do not adopt the 
Monitoring Performance Safe Harbor.
    86. Managing Intermediate Provider Safe Harbor. We adopt the 
Managing Intermediate Provider Safe Harbor in part, to reduce a 
qualifying provider's reporting obligations and reduce the data 
retention obligations from six months to three months. Qualifying 
covered providers must comply with the reporting requirements for one 
year and must retain the call detail records described above in a 
readily retrievable form for only three calendar months, but must have 
three full months of data available at all times. To qualify, a 
provider must certify on an annual basis either that it uses no 
intermediate providers, or that all of its contracts with directly 
connected intermediate providers allow those intermediate providers to 
pass a call to no more than one additional intermediate provider (that 
is, a total of no more than two intermediate providers in the call 
path) before the call reaches the terminating provider or terminating 
tandem. The provider must further certify that any nondisclosure 
agreement with an intermediate provider permits the covered provider to 
reveal the identity of the directly connected intermediate provider and 
any additional intermediate provider to the Commission and to the rural 
carrier(s) whose incoming long-distance calls are affected by 
intermediate provider performance. Finally, the provider must certify 
that if it uses intermediate providers, it has a process in place to 
monitor the performance of its intermediate providers. Providers may 
utilize the safe harbor by filing a certification on any of the four 
quarterly filing dates throughout the year (and filings are due 
annually thereafter). Thus, a provider does not need to wait until the 
next annual certification to take advantage of the safe harbor. At the 
same time, a provider must comply with our full data retention and 
reporting obligations for any quarter in which it no longer qualifies 
for the safe harbor (i.e., its business practices cease to comply with 
the terms of its certification).
    87. Several commenters oppose this safe harbor, expressing 
skepticism about its efficacy in preventing rural call completion 
problems. NARUC and the rural associations describe the safe harbor as 
premature until it can be validated by a history of reporting. We 
disagree. Our experience in investigating and resolving rural call 
completion complaints suggests that problems with routing calls to 
rural areas typically arise where more than two intermediate providers 
are involved in transmitting a call. An originating provider that 
limits the intermediate providers in the call path to two is better 
able to manage performance to rural destinations than an originating 
provider that sends calls through numerous intermediate providers, the 
identities of which the originating provider may not even know. We 
agree that ``[l]imiting the number of intermediate providers that may 
handle a call limits the potential for lengthy call setup delays and 
looping.''
    88. Moreover, our examination of carrier practices during 
enforcement proceedings and when responding to complaints has revealed 
that the proliferation of rural call completion problems in recent 
years has coincided with the proliferation of intermediate providers, 
the use of which appears to contribute to call completion problems and 
often results in nearly untraceable call routes. This situation has 
arisen after decades of uncontroversial, well-functioning use of 
intermediate providers for least-cost routing. This suggests that a 
provider that has a manageable network with few intermediate providers 
in a call path will provide better performance.
    89. We do, however, modify the proposed safe harbor by requiring 
the same reporting for a period of one year as for providers not 
invoking the safe harbor and requiring the same recording requirements, 
but limit the retention period to three full calendar months rather 
than six. One year of reporting will provide the Commission with data 
on completion rates from safe-harbor qualifiers to ensure that such 
providers are achieving satisfactory rural call completion performance. 
Furthermore, the recording requirements ensure that the providers have 
the data available should there be a need to initiate investigation. 
And, we believe that, absent any retention requirements, providers may 
have an incentive to purge data quickly to avoid having relevant 
information for any possible investigation.
    90. Even so, we reduce the burden by limiting reporting to one year 
and retention to three months of data for several reasons. First, we 
want to encourage providers to take advantage of the safe harbor and 
expect fewer rural call completion issues, if any, to arise regarding 
providers that qualify for the safe harbor. Several providers 
encouraged the Commission to adopt a three-month retention period to 
reduce the burden. Second, the Enforcement Bureau is already able to 
require providers to retain these records for a longer period of time 
and may revoke a provider's use of this safe harbor if that provider 
fails to comply with the safe harbor requirements. Third, because we 
expect rural call completion to be less of a problem for safe-harbor 
qualifiers, our concern that six months of record retention is 
necessary to ensure that the first month of data reflected in any 
report has not been purged before the Commission has had a reasonable 
opportunity to review the quarterly report is mitigated here.
    91. Some commenters seek clarification on whether, if a provider 
other than the terminating rural ILEC operates the terminating tandem 
switch, that provider counts as an intermediate provider for purposes 
of eligibility for this safe harbor. We clarify that it does not. Our 
experience in investigating rural call completion complaints indicates 
that when a call does reach the terminating tandem, regardless of 
ownership, it is completed by the rural ILEC with a very high degree of 
reliability. Accordingly, if a provider merely operates a terminating 
tandem that delivers traffic to a rural ILEC, delivering traffic to the 
terminating tandem operated by that provider does

[[Page 76231]]

not count as using an additional intermediate provider for purposes of 
this safe harbor.
    92. One commenter seeks clarification concerning the categorization 
of an intermediate provider that operates a comprehensive network of 
organizationally separate affiliates. We agree that an intermediate 
provider at either the first or second level includes all of the 
intermediate provider's affiliates.
    93. Finally, the NPRM proposed that originating providers maintain 
a self-certified monitoring process to qualify for this safe harbor. 
Many commenters indicate that they monitor the performance of their 
first-level intermediate providers using a variety of key performance 
measures including but not limited to overall answer-seizure ratio 
(ASR), network effectiveness ratio (NER), and post-dial delay. One 
interexchange carrier requested additional guidance. Because we want to 
encourage providers covered by the safe harbor to analyze their own 
performance and that of any intermediate providers, we do not require 
qualifying providers to use any particular process. Instead, we require 
that they describe the process they use to monitor their intermediate 
providers in their annual filings certifying compliance with the safe 
harbor.
    94. We note that this safe harbor decreases reporting and data 
retention obligations for a covered provider, but is not a safe harbor 
from the Commission's normal investigatory processes. For example, the 
Commission will continue to serve rural call completion complaints from 
consumers and rural carriers on service providers that invoke the safe 
harbor. Furthermore, we delegate authority to the Enforcement Bureau to 
revoke a provider's use of the safe harbor if the Bureau finds that the 
provider is not in compliance with the safe harbor requirements. At any 
time, the Bureau may request copies of the provider's contracts or 
agreements with intermediate providers as well as other evidence 
regarding the covered provider's processes for monitoring the 
performance of its intermediate providers. If the Bureau determines 
that evidence warrants revocation of the provider's safe harbor 
protection, the Bureau shall notify the service provider of such 
revocation by letter. The provider's safe harbor protection shall 
terminate 30 days after the revocation letter is mailed. Accordingly, 
any provider taking advantage of the safe harbor should be prepared to 
begin complying with the additional data retention requirements and the 
reporting requirements within 30 days. A service provider that loses 
safe harbor protection in this manner may seek reconsideration or 
review of the Bureau's decision in accordance with the Commission's 
rules. While we anticipate that the need to revoke a provider's use of 
the safe harbor will not occur often, we must remain prepared to assess 
and address rural call completion issues involving providers that use 
the safe harbor.
    95. Waivers of Data Collection and Retention Requirements. Although 
the safe harbor encourages providers to take steps to reduce the rural 
call completion problem, we note that the industry through the ATIS 
Handbook and other means has identified other significant steps 
providers can take to ensure calls to rural areas are completed. We 
seek comment in the FNPRM about imposing additional requirements to 
take advantage of the safe harbor in the future. While the FNPRM is 
pending, we adopt a waiver process to enable providers that have taken 
steps in addition to satisfying the requirements for the Managing 
Intermediate Provider Safe Harbor to ensure calls to rural areas are 
being completed to receive a waiver of the data retention obligations.
    96. To encourage providers to take immediate and decisive action to 
redress rural call completion problems, we will consider requests for 
waiver of the specific reporting and data retention rules as described 
herein. We delegate to the Wireline Competition Bureau, in consultation 
with the Enforcement Bureau, the authority to act on such waiver 
requests. In evaluating a provider's waiver request, the Bureau should 
consider not only whether a provider has demonstrated that it qualifies 
for the Managing Intermediate Provider Safe Harbor, but also whether it 
persuasively demonstrates that it has processes in place to ensure that 
call attempts to rural incumbent LECs successfully reach their 
destinations, such as by adopting industry best practices. The Bureau 
should also consider whether the provider has demonstrated that it has 
capabilities and processes to monitor its own performance by the OCN of 
the called party's ILEC (rather than just at an aggregate level). The 
Bureau shall require, as a condition of a waiver, that a provider 
report information about rural call completion for a one-year period, 
and such a report may be based on a statistically valid sample of 
calls. In addition, the Bureau may require, as a condition of a waiver, 
that a provider collect and retain some data, such as data reflecting a 
statistically valid sample of calls to rural and non-rural areas.
    97. By adopting this waiver process, we hope to encourage providers 
to adopt practices and processes to prevent rural call completion 
problems from occurring in the first place, thus benefitting rural 
consumers and avoiding the need for enforcement. Providers are free to 
file such waiver requests before the Commission receives OMB approval 
for the data retention and reporting obligations. We also encourage the 
Bureau to act upon such requests on an expedited basis.
    98. Monitoring Performance Safe Harbor. The NPRM proposed a second 
safe harbor that would subject a provider to a reduced call completion 
data retention obligation and relieve the provider of all reporting 
obligations if the provider certified that it had met the following 
performance standards. The average call answer rate for all rural 
carriers (i.e., not weighted by call volume) to which the provider 
attempted more than 100 calls in a month could be no more than 2 
percent less than the average call answer rate for all calls it placed 
to nonrural carriers in the same month. Additionally, the call answer 
rates for 95 percent of those rural carriers to which the provider 
attempted more than 100 calls could be no more than 3 percent below the 
average rural call answer rate.
    99. Some commenters objected to the suggestion implicit in this 
safe harbor that a small differential between rural and nonrural 
average call answer rates is acceptable. Other commenters suggested 
that the proposed differential (no more than 2 percent) may be too 
small to be of practical or statistical significance. One large carrier 
notes that the requirement that 95 percent of all rural sites be no 
more than 3 percent below the average rural call answer rate 
presupposes an abnormally narrow distribution and suggests the 
Commission needs to do analysis to establish permissible variance.
    100. After reviewing the record, we decline to adopt the Monitoring 
Performance Safe Harbor at this time. We agree with commenters that we 
should not adopt a performance-based safe harbor before we receive any 
call completion data from providers.
7. Duration of Rules
    101. In the NPRM, the Commission sought comment on whether any 
recording and reporting requirements adopted in this proceeding should 
expire at the end of the intercarrier compensation transition to bill-
and-keep or some other point. As discussed more fully above, the USF/
ICC Transformation Order adopted rules that should address the root 
causes of

[[Page 76232]]

many rural call completion problems. In particular, the Commission 
adopted a bill-and-keep methodology for all intercarrier traffic, and 
adopted a transition plan to gradually reduce most termination charges, 
which, at the end of the transition, should eliminate the financial 
incentive that appears to be contributing significantly to rural call 
completion problems.
    102. Many carriers comment that the rules should expire before the 
transition to bill-and-keep is complete. They argue that ``systemic 
problems with rural call completion resulting from the current access 
regime should disappear as the incentives to avoid high, rural 
terminating rates decrease,'' thus the Commission should sunset the 
rules in this order prior to the completion of a transition to bill-
and-keep. Commenters propose that targeted enforcement, scheduled 
reviews of the continuing need for these rules, or hard expiration 
deadlines will provide ``more than sufficient time to determine whether 
a call completion issue exists in particular rural destinations or with 
particular intermediate carriers.''
    103. Other commenters urge the Commission to refrain from setting 
an expiration date until these rules are clearly unnecessary. Many 
commenters suggest that terminating access charges and reciprocal 
compensation are not the only incentives for certain originating and 
intermediate carriers to avoid completing calls to rural customers. For 
example, there may be unique incentives for carriers to not complete 
calls in rural versus nonrural areas, because many of the calls to 
rural LEC exchanges ``must be carried over lengthy transport and 
transit routes operated by third parties, to whom compensation must be 
paid by toll service providers,'' and that ``[i]n the highly 
competitive, low-margin long-distance toll service market, LCR 
providers will still be tempted to reduce their transit/transport costs 
by taking networking shortcuts or blocking calls to such RLEC service 
areas even after [many intercarrier compensation] charges go to bill-
and-keep.'' Further, as one commenter suggests, ``[w]ith the sunset of 
the rules, any short term solutions could unravel the progress made, 
because the factors not directly linked to the ICC reform transition 
could trigger a relapse in the performance by the industry in 
completing calls to rural customers.'' Other commenters note that while 
terminating access rates have declined, the number of call completion 
problems to rural areas have actually increased. Some comments suggest 
that any rules should not expire because the impact of VoIP providers 
on rural call completion is unclear, stating that ``because VoIP 
providers are applying less rigorous call completion standards than the 
rest of the PSTN, then there will continue to be a need for the rules 
adopted in this proceeding regardless of the level of terminating 
rates.''
    104. Based on the record before us, we decline at this time to 
adopt a sunset date for the rules we adopt today. We believe that these 
rules will provide relief to rural consumers who are receiving inferior 
telephone service. The Commission must also ensure that it has the data 
necessary to adopt a long-term solution regarding the disparity in call 
completion rates between rural and nonrural areas. While the bill-and-
keep transition should, to a large extent, eliminate the financial 
incentive structure that contributes to rural call completion problems, 
we agree with commenters that rural call completion problems may not be 
solely attributable to terminating charges.
    105. Although we decline to adopt a specific sunset date, we 
anticipate that our need for these rules will decrease, particularly as 
the transition to a bill-and-keep regime continues. To assist with that 
examination, we direct the Wireline Competition Bureau to analyze the 
eight sets of reports submitted during the first two years of the data 
collection's effectiveness (as well as any other information the 
Commission receives during that period regarding the causes of and 
solution to rural call completion) and to publish for public comment a 
report on the effectiveness of the rules, whether data collection and 
reporting should be reduced or eliminated for certain providers or 
classes of providers (including those that meet a performance-based 
standard over four consecutive quarters), whether the Commission should 
extend data collection and reporting requirements to certain 
intermediate providers, and how the Commission can incorporate industry 
best practices, such as those developed through ATIS, into its work. 
The Bureau shall publish that report no more than 90 days after the 
last reports are due for that two-year period.
    106. Furthermore, to ensure that the data collection and reporting 
rules we adopt today do not last without review in perpetuity, the 
Commission shall complete a proceeding in which we reevaluate whether 
to keep, eliminate, or amend the data collection and reporting rules 
three years after they become effective. That time should be sufficient 
for the Commission and the public to review the data collected herein, 
as well as the report of the Wireline Competition Bureau, and determine 
whether the rules adopted today remain in the public interest going 
forward.
8. Voluntary Reporting by Rural Incumbent Local Exchange Carriers
    107. One commenter proposes that terminating rural incumbent LECs 
file quarterly reports documenting the number of incoming long-distance 
call attempts received and the number answered on their network. We 
agree that a terminating rural ILEC's call answer rate for incoming 
calls would be an important benchmark that could be responsive to 
speculation about local rural user behavior and local rural service 
distinctions, both among individual rural ILECs and between rural and 
nonrural terminating ILECs generally. It would also be an important 
benchmark against which to evaluate the number of call attempts that 
covered providers report as having reached a rural ILEC's terminating 
switch or tandem, and the number that covered providers report as 
having been answered.
    108. We think that it is in the terminating rural ILECs' own 
interest to report this information on a voluntary basis. We therefore 
encourage, but do not require, rural ILECs to report quarterly on the 
number of incoming long-distance call attempts received, the number 
answered on its network, and the call answer rate calculation for each 
of the previous three months, by the reporting dates for covered 
providers. In the FNPRM we seek comment on whether we should mandate 
reporting by rural ILECs.
9. Disclosure of Reported Data
    109. The NPRM sought comment on whether the information that will 
be provided pursuant to the reporting requirements should be treated as 
confidential or be open to public inspection. After reviewing the 
record, we conclude that covered providers filing these reports may 
request confidential treatment of all or portions of the data they 
submit without filing the detailed confidentiality justification 
required by section 0.459 of our rules. If the Commission receives a 
request for, or proposes disclosure of, the information contained in 
the report, the provider will be notified and required to make the full 
showing under section 0.459 as to why confidentiality is warranted. 
Taking into consideration that covered providers must submit these 
reports quarterly, as well as the unique and relatively homogenous 
nature of this data collection, these streamlined procedures for 
requesting nondisclosure should greatly improve the ability of 
providers to request

[[Page 76233]]

confidential treatment of their data in a timely manner while 
minimizing the burden of doing so. The Commission will release 
information to states upon request, if those states are able to 
maintain the confidentiality of this information. The Commission 
imposes similar confidentiality requirements on state commissions 
seeking to gain access to broadband subscription data filed pursuant to 
our Form 477. The Commission also expects to make aggregated data 
available to states and the public.
    110. We recognize that there may be benefits to providing public 
access to the information in these reports. Some commenters argue that 
the public and/or other entities should have access to this information 
because this would provide an incentive to correct call completion 
problems, would be effective in deterring and resolving call blocking, 
and would provide valuable data for rural LECs to identify the cause of 
uncompleted calls. We further recognize that information submitted may 
be confidential. Some commenters assert that the reports should not be 
publicly disclosed because they could result in public misperception of 
the nature of the call completion problem, could result in the misuse 
of information taken out of context, and may prove difficult to compare 
fairly across providers due to potentially differing abilities of 
providers, for example, to identify autodialer traffic or account for 
call attempts that are handed back to be retried using a different 
intermediate provider. For now, we find that the approach we adopt 
today appropriately balances the filers' disclosure concerns with the 
public need for access to this information.

B. Rules To Address Ring Signaling

    111. False Audible Ringing. One of the rural call completion 
problems that parties have identified is ``false audible ringing.'' 
False audible ringing occurs when an originating or intermediate 
provider prematurely triggers audible ring tones to the caller before 
the call setup request has actually reached the terminating rural 
provider. That is, the calling party believes the phone is ringing at 
the called party's premises when it is not. An originating or 
intermediate provider may do this to mask the silence that the caller 
would otherwise hear during excessive call setup time. As a result, the 
caller may often hang up, thinking nobody is available to receive the 
call. False audible ringing can also make it appear to the caller that 
the terminating rural provider is responsible for the call failure, 
instead of the originating or intermediate provider. Once an 
intermediate provider provides a ringing indication to an originating 
provider while still processing the call, the call cannot be handed 
back to the preceding provider for an alternate route.
    112. In the NPRM, the Commission proposed to mandate that audible 
ringing be provided to callers only after the terminating provider 
affirmatively signals that the called line is free and the called party 
is being alerted. The record overwhelming supports the adoption of the 
proposed rule. False audible ringing departs from longstanding and 
well-established telephony signaling practices. Indeed, many commenters 
urge the Commission to simply codify the industry standard prohibiting 
false audible ringing, stating that ``numerous industry signaling 
standards and definitions . . . unambiguously establish that an audible 
ringing indication should be provided to the caller only after the 
terminating provider signals that the called line is free and the 
called party is being alerted.'' Some commenters support prohibiting 
false audible ringing broadly across the industry, stating that our 
prohibition ``should be applied across all providers that allow end 
users to make voice calls regardless of license, function, or 
authority,'' because such a practice ``is not likely to harm just 
consumers in rural areas; the harm could just as well fall on customers 
in nonrural areas, in the absence of an industry-wide rule.'' Because 
the proposed rule simply codifies long-standing industry practice, the 
majority of commenters do not believe such a rule is unduly burdensome.
    113. Only two commenters opposed a rule prohibiting false ring 
signaling. The VON Coalition argues that the adoption of such a rule 
that could potentially thwart enhanced functionalities that VoIP 
providers may develop and possibly make these providers ``limit their 
end user services in order to conform to `traditional' call flows would 
be contrary to the Commission's settled deregulatory approach to 
VoIP.'' Vonage, on the other hand, argues the real underlying issue 
``is not `false' ringing per se. Rather, the root issue is excessive 
post-dial delay in connecting a call to the terminating switch (i.e., 
post-dial delay that is sometimes filled by `false' ringing) . . . 
which may simply be used by providers to ensure that the calling party 
does not hang up before the call is answered because the calling party 
hears a relatively prolonged silence.'' They further argue that 
``[p]rohibiting false ringing could have unintended consequences such 
as extended silence after the call is placed. This could lead to 
confusion and increased hang-ups by the calling party, which would 
increase (rather than reduce) the incidence of call completion 
problems.'' By contrast, another commenter responds that Vonage's 
argument ``is tantamount to an argument that phone users are properly 
deceived into thinking that the called party's phone is ringing when in 
fact it is not. Deception is not sound public policy.''
    114. We find many benefits to adopting the proposed rule 
prohibiting false ring signaling, as set forth in the NPRM. We find 
that this rule will benefit both consumers and industry and avoid 
unnecessary confusion that may occur today about whether the call was 
actually delivered to the called party. Consumer expectation is simple: 
if a calling party hears audible ringing, the calling party believes 
the called party's phone is ringing or otherwise being alerted in the 
same timeframe. As a result of this rule, consumers will no longer 
prematurely hang up when the call has not even rung on the caller's 
side, nor will consumers mistakenly believe that the terminating rural 
provider is responsible for the call failure. Industry will benefit 
from this rule because intermediate providers will now hand back calls 
that have excessive set-up time to the preceding provider to find an 
alternate route, so that the call can ultimately be completed. 
Originating providers will be able to better identify (and compare) 
intermediate providers with patterns of service failures and, if they 
choose, elect other intermediate providers. Because this rule codifies 
a long-standing industry standard, it should not be unduly burdensome. 
We expect that this rule will improve the call completion rates to 
rural areas, therefore benefiting consumers and industry alike.
    115. Accordingly, we adopt a rule prohibiting false audible 
ringing. More specifically, all originating and intermediate providers 
are prohibited from causing audible ringing to be sent to the caller 
before the terminating provider has signaled that the called party is 
being alerted. We clarify that alerting the called party includes 
alerting devices, services or parties that can answer the call such as 
an interactive voice response, answering service, voicemail or call-
forwarding system or any such system that can cause the network to 
register that the terminating party has gone off hook. As we proposed 
in the NPRM, originating and intermediate providers must also convey 
audio tones and announcements sent by the terminating provider to the 
calling party. We apply this rule

[[Page 76234]]

prohibiting false audible ringing to all originating providers and 
intermediate providers, including local exchange carriers, 
interexchange carriers, commercial mobile radio service (CMRS) 
providers, interconnected VoIP, and one-way VoIP providers. These rules 
apply to both interstate and intrastate calls, as well as to both 
originating and terminating international calls while they traverse 
U.S. networks.
    116. Legal Authority. Our authority for prohibiting false audible 
ringing to all originating and intermediate providers lies in section 
201(b) of the Act. It is an unreasonable practice to send misleading 
ring sounds to customers making long-distance calls, as it may cause 
them to believe that the called party is not answering when in fact the 
call has not yet been connected, or has been connected for a shorter 
time than the ring sounds would lead the calling party to believe. The 
majority of the comments assert that false audible ringing contributes 
to the disparity between rural and nonrural call completion rates. 
Adopting a rule that prohibits false audible ringing therefore aids in 
the Commission's efforts to ensure that provider practices are not 
unjust or unreasonable.
    117. We also apply this rule to interconnected and one-way VoIP 
providers that send calls to terminate on the PSTN, as well as 
intermediate providers that are not common carriers, as ``reasonably 
ancillary to the effective performance of [our] statutorily mandated 
responsibilities'' under section 201(b). The purpose of the rule is to 
address the problem of calls failing to complete to rural PSTN 
customers. Given the substantial role that VoIP service connected to 
the PSTN plays in the retail long-distance telephone market, and the 
potential for intermediate providers to be non-carriers, excluding such 
providers from the prohibition against false audible ringing would 
undermine the effectiveness of the rule, as well as the Commission's 
ability to ensure that carrier practices are both just and reasonable. 
Specifically, if VoIP customers or callers being indirectly served by 
non-carrier intermediate providers receive misleading ring sounds, 
leading them to mistakenly believe that the called party is not 
answering when in fact the called party has not been alerted, the 
terminating carrier may be erroneously subject to complaints regarding 
its perceived failure to terminate calls to its customers. Indeed, it 
is not ``just and reasonable'' for customers of rural terminating 
carriers not to be alerted to incoming calls or to be alerted for less 
time than the calling parties believes. The Commission has previously 
applied ring signaling rules to interconnected VoIP service providers, 
including intermediate providers in a call path. For the same reasons 
that the Commission has authority to prohibit intermediate providers 
from altering the calling number, the Commission has authority to apply 
the false audible ringing rule to intermediate providers. The problem 
would not be adequately addressed without addressing the practices of 
VoIP service and intermediate providers.
    118. Adopting a prohibition against false ring signaling will help 
the Commission isolate problems that are the responsibility of carriers 
subject to section 201(b), and help us uncover and better understand 
call completion issues which could otherwise be obfuscated. If we did 
not do so, callers would continue to think that calls were being 
completed that in fact had never made it to the rural LEC or its 
customer. Likewise, if false ring signaling were not prohibited, 
originating providers and some intermediate providers would treat calls 
passed to a downstream intermediate provider as having been answered 
when in fact they were not being completed. The prevention of such 
problems by prohibiting all originating and intermediate carriers, 
interconnected VoIP providers, and one-way VoIP providers from 
transmitting false audible signaling is therefore reasonably ancillary 
to the effective performance of our duties in enforcing section 201(b).
    119. Finally, we apply this false audible ringing rule to all 
traffic, including intrastate traffic. The USF/ICC Transformation Order 
expanded the scope of our call signaling rules to encompass 
jurisdictionally intrastate traffic. Where providers previously were 
required to include the Calling Party Number (CPN) on interstate calls, 
the Commission required such information to be included on intrastate 
calls as well. The Commission noted that CPN-based services are 
jurisdictionally mixed services and it would be impractical and 
uneconomic to require the development and implementation of systems 
that would permit separate federal and state call signaling rules to 
operate. We conclude here, as we did in the USF/ICC Transformation 
Order, that it would be infeasible to have separate federal and state 
rules regarding false audible ringing because, inter alia, there would 
be significant confusion among consumers and long-distance providers if 
the presence or absence of a ring signal had a different meaning on 
interstate versus intrastate calls, thus exacerbating the problems that 
we have seen to date. We conclude, therefore, that we have authority to 
extend the false audible ringing rule to intrastate traffic.

IV. Procedural Matters

A. Paperwork Reduction Act Analysis

    120. This document contains new information collections subject to 
the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. They will 
be submitted to the Office of Management and Budget (OMB) for review 
under section 3507(d) of the PRA, 44 U.S.C. 3507. Prior to submission 
to OMB, the Commission will publish a notice in the Federal Register 
seeking public comment on the information collections. In addition, 
that notice will also seek comment on how the Commission might 
``further reduce the information collection burden for small business 
concerns with fewer than 25 employees'' pursuant to the Small Business 
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 
3506(c)(4). The information collections contained in this Report and 
Order will not go into effect until OMB approves the collections and 
the Commission has published a notice in the Federal Register 
announcing the effective date of the information collections.

B. Congressional Review Act

    121. The Commission will send a copy of this Report and Order and 
Further Notice of Proposed Rulemaking to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).

V. Final Regulatory Flexibility Analysis

    122. As required by the Regulatory Flexibility Act (RFA), an 
Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the 
Notice of Proposed Rulemaking (NPRM) in WC Docket No. 13-39. The 
Commission sought written public comment on the proposals in the NPRM, 
including comment on the IRFA. This Final Regulatory Flexibility 
Analysis (FRFA) conforms to the RFA.

A. Need for, and Objectives of, the Report and Order

    123. This Report and Order (Order) continues the Commission's 
efforts to identify the causes of--and potential remedies for--the 
ongoing and widespread problems with the completion of long-distance 
telephone calls to rural areas. In the Order, the Commission adopts 
rules to address significant concerns about completion

[[Page 76235]]

of long distance calls to rural areas. Doing so will help ensure that 
long distance calls to all Americans, including rural Americans, are 
completed. Completion rates for long-distance calls to rural telephone 
company service areas are frequently poor--whether the call is 
significantly delayed, the called party's phone never rings, the caller 
hears false busy signals, or there are other problems. These failures 
have significant and immediate public interest ramifications, causing 
rural businesses to lose customers, cutting families off from their 
relatives in rural areas, and creating potential for dangerous delays 
in public safety communications in rural areas. The rules adopted in 
the Order are a critical step to eliminating this significant problem 
by improving the Commission's ability to monitor the delivery of long-
distance calls to rural areas, aiding enforcement action in connection 
with providers' call completion practices as necessary, as well as by 
aiding consumers and industry by adopting a rule prohibiting false ring 
signaling.
    124. Adopting recording, retention, and reporting requirements will 
substantially increase our ability to monitor and redress problems 
associated with completing calls to rural areas. These rules will also 
enhance our ability to enforce restrictions against blocking, choking, 
reducing, or restricting calls. The recording, retention, and reporting 
rules should apply to providers of long-distance voice service that 
make the initial long-distance call path choice for more than 100,000 
domestic retail subscriber lines, counting the total of all business 
and residential fixed subscriber lines and mobile phones and aggregated 
over all of the providers' affiliates (referred to herein as ``covered 
providers''). In most cases, this is the calling party's long-distance 
provider. As discussed below, covered providers include LECs, 
interexchange carriers (IXCs), commercial mobile radio service (CMRS) 
providers, and VoIP service providers. Finally, we do not apply these 
rules to intermediate providers.
    125. The Order requires covered providers to record and retain the 
following information for each long-distance call to a local exchange 
carrier that is a rural telephone company: Calling party number; called 
party number; date; time of day; whether the call is handed off to an 
intermediate provider and, if so, which intermediate provider; whether 
the call is going to a rural carrier and, if so, which rural carrier, 
as identified by its operating company number (OCN); whether the call 
is interstate; whether the call attempt was answered; and whether the 
call attempt was completed to the incumbent local exchange carrier but 
signaled as busy, ring no answer, or unassigned number. For most 
providers, this indication is likely to take the form of an SS7 
signaling cause code or SIP signaling message code associated with each 
call attempt. While covered providers need not retain data for calls to 
nonrural OCNs, they must nonetheless record such data to the extent 
that it is necessary to comply with the reporting obligations described 
below. The Order also concludes that the most useful comparison of call 
completion rates is between rural and nonrural incumbent LECs, and thus 
excludes calls terminating to CLECs, CMRS providers, or VoIP services 
providers from the recording, retention, and reporting requirements. 
The Order also requires filers to include autodialer traffic in their 
recording, retention and reporting but allows them file a separate 
report that segregates autodialer traffic from other traffic, 
accompanied by an explanation of the method the used to identify the 
autodialer traffic. In addition, recording, retention, and reporting 
requirements set forth in the Order apply to call attempts of very 
short duration, while excluding call attempts handed back to an 
upstream provider and call attempts to toll-free numbers. The Order 
requires covered providers to retain the call detail records described 
above for calls to rural OCNs in a readily retrievable form for at 
least six calendar months, except as described in the discussion of the 
safe harbor, below.
    126. The reporting obligations adopted in the Order require covered 
providers to submit a certified report to the Commission once per 
calendar quarter that includes, for each full month in that quarter: 
(1) For each rural OCN, the OCN, the state, the total number of 
attempted interstate calls, the number of attempted interstate calls 
that were answered, and the number of attempted interstate calls that 
were not answered, reported separately for call attempts signaled as 
busy, ring no answer, or unassigned number; (2) the same information 
described in (1), but for intrastate calls; (3) the same information 
regarding attempted interstate calls described in (1), but for nonrural 
OCNs in the aggregate; and (4) the same information regarding attempted 
intrastate calls described in (2), but for nonrural OCNs in the 
aggregate. These data permit calculation of the percentage of calls 
answered (the call answer rate) and the percentage of calls completed 
to the terminating provider regardless of whether answered or 
unanswered by the user (the network effectiveness ratio). Collecting 
these data points will provide the Commission with better insight into 
the reasons why calls are not answered or not reaching their 
destinations. The Order defines the term ``answered call'' to mean ``a 
call that was answered by or on behalf of the called party (including 
calls completed to devices, services or parties that answer the call 
such as an interactive voice response, answering service, voicemail or 
call-forwarding system or any such system that cause the network to 
register that the terminating party has gone off hook).'' The Order 
requires each covered provider to report monthly information for each 
rural OCN to which the provider attempted to deliver calls and decline 
to adopt a minimum calls per month threshold for reporting by rural 
OCN. The Order also concludes that the Commission will obtain the most 
informative data by collecting data on all call attempts, rather than 
attempts during a peak period, and adopts a monthly measurement 
interval and quarterly reporting interval for covered providers. The 
Order also encourages rural ILECs to voluntarily report their own call 
answer rates by terminating rural OCN, which we believe would be an 
important benchmark that could be responsive to speculation about local 
rural user behavior and local rural service distinctions both among 
individual rural ILECs and between rural and nonrural terminating ILECs 
generally.
    127. The Order adopts a rule prohibiting all originating and 
intermediate providers from causing audible ringing to be sent to the 
caller before the terminating provider has signaled that the called 
party is being alerted, and clarifies that ``alerting the called 
party'' includes alerting devices, services or parties that can answer 
the call such as an interactive voice response, answering service, 
voicemail or call-forwarding system or any such system that can cause 
the network to register that the terminating party has gone off hook. 
Originating and intermediate providers must also convey audio tones and 
announcements sent by the terminating provider to the calling party. 
The rule prohibiting false audible ringing applies to all originating 
providers and intermediate providers, including LECs, IXCs, CMRS 
providers, interconnected VoIP, and one-way VoIP providers.
    128. The rules adopted in the Order will help the Commission, our 
state partners, and the reporting providers

[[Page 76236]]

monitor call completion performance and address problem areas. At the 
same time, we are mindful of the potential burdens and take actions to 
minimize them, particularly on smaller entities. The Order therefore 
limits the application of the recording, retention, and reporting 
requirements to providers with more than 100,000 retail customers. We 
also target our regulations to address the source of the problem. 
Because the problems appear to increase significantly when a call is 
handed off among multiple providers, the Order adopts a safe harbor to 
encourage providers to limit the number of hand offs. Specifically, 
providers that restrict by contract directly connected intermediate 
providers to no more than one additional intermediate provider in the 
call path will be relieved of the reporting obligation after one year 
and have a reduced record retention period, although such providers may 
be required to comply with those requirements at the discretion of the 
Enforcement Bureau. Similarly, covered providers adhering to industry 
best practices and other measures intended to ensure robust call 
completion performance may apply for a waiver of these recording, 
retention, and reporting requirements. Our regulations are carefully 
targeted to help address the problems with completing calls in rural 
areas while minimizing the burdens of compliance for all covered 
providers, including small entities. We also note that the ring 
signaling integrity requirements adopted in the Order may have an 
economic impact on small entities, but believe that the benefits to the 
functioning of the PSTN and to consumers outweigh any burdens.

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

    129. There were no comments filed that specifically addressed the 
rules and policies proposed in the IRFA. To the extent we received 
comments raising general small business concerns during this 
proceeding, those comments are discussed throughout the Order.

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

    130. 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 proposed rules, if adopted. 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.
    131. Small Businesses. Nationwide, there are a total of 
approximately 27.9 million small businesses, according to the SBA.
    132. 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 
Census data for 2007 shows that there were 31,996 establishments that 
operated that year. Of those 31,996, 1,818 operated with more than 100 
employees, and 30,178 operated with fewer than 100 employees. Thus, 
under this size standard, the majority of firms can be considered 
small.
    133. Local Exchange Carriers (LECs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to 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, Census data for 2007 
shows that there were 31,996 establishments that operated that year. Of 
those 31,996, 1,818 operated with more than 100 employees, and 30,178 
operated with fewer than 100 employees. Consequently, the Commission 
estimates that most providers of local exchange service are small 
entities that may be affected by the rules and policies proposed in the 
NPRM.
    134. Incumbent Local Exchange Carriers (Incumbent LECs). 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, 1,307 carriers reported that they were incumbent local 
exchange service providers. Of these 1,307 carriers, an estimated 1,006 
have 1,500 or fewer employees and 301 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 
rules adopted pursuant to the NPRM.
    135. We have included small incumbent 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.
    136. Competitive Local Exchange Carriers (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, 1,442 carriers reported that they were 
engaged in the provision of either competitive local exchange services 
or competitive access provider services. Of these 1,442 carriers, an 
estimated 1,256 have 1,500 or fewer employees and 186 have more than 
1,500 employees. In addition, 17 carriers have reported that they are 
Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 
or fewer employees. In addition, 72 carriers have reported that they 
are Other Local Service Providers. Of the 72, seventy have 1,500 or 
fewer employees and two have more than 1,500 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 that 
may be affected by rules adopted pursuant to the NPRM.
    137. 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

[[Page 76237]]

Commission data, 359 companies reported that their primary 
telecommunications service activity was the provision of interexchange 
services. Of these 359 companies, an estimated 317 have 1,500 or fewer 
employees and 42 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 rules adopted 
pursuant to the NPRM.
    138. 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. 
Census data for 2007 show that 1,523 firms provided resale services 
during that year. Of that number, 1,522 operated with fewer than 1000 
employees and one operated with more than 1,000. Thus, under this 
category and the associated small business size standard, the majority 
of these prepaid calling card providers can be considered small 
entities. According to Commission data, 193 carriers have reported that 
they are engaged in the provision of prepaid calling cards. Of these, 
an estimated all 193 have 1,500 or fewer employees and none have more 
than 1,500 employees. Consequently, the Commission estimates that the 
majority of prepaid calling card providers are small entities that may 
be affected by rules adopted pursuant to the NPRM.
    139. 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. Census data for 2007 show that 1,523 firms provided resale 
services during that year. Of that number, 1,522 operated with fewer 
than 1000 employees and one operated with more than 1,000. Thus, under 
this category and the associated small business size standard, the 
majority of these prepaid calling card providers can be considered 
small entities. According to Commission data, 213 carriers have 
reported that they are engaged in the provision of local resale 
services. Of these, an estimated 211 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 rules adopted pursuant to the NPRM.
    140. 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. Census data for 2007 show that 1,523 firms provided resale 
services during that year. Of that number, 1,522 operated with fewer 
than 1000 employees and one operated with more than 1,000. Thus, under 
this category and the associated small business size standard, the 
majority of these prepaid calling card providers can be considered 
small entities. According to Commission data, 881 carriers have 
reported that they are engaged in the provision of toll resale 
services. Of these, an estimated 857 have 1,500 or fewer employees and 
24 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of toll resellers are small entities that 
may be affected by rules adopted pursuant to the NPRM.
    141. Other Toll Carriers. Neither the Commission nor the SBA has 
developed a size standard for small businesses specifically applicable 
to Other Toll Carriers. This category includes toll carriers that do 
not fall within the categories of interexchange carriers, operator 
service providers, prepaid calling card providers, satellite service 
carriers, or toll resellers. 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. 
Census data for 2007 shows that there were 31,996 establishments that 
operated that year. Of those 31,996, 1,818 operated with more than 100 
employees, and 30,178 operated with fewer than 100 employees. Thus, 
under this category and the associated small business size standard, 
the majority of Other Toll Carriers can be considered small. According 
to Commission data, 284 companies reported that their primary 
telecommunications service activity was the provision of other toll 
carriage. Of these, an estimated 279 have 1,500 or fewer employees and 
five have more than 1,500 employees. Consequently, the Commission 
estimates that most Other Toll Carriers are small entities that may be 
affected by the rules and policies adopted pursuant to the NPRM.
    142. Wireless Telecommunications Carriers (except Satellite). Since 
2007, the SBA has recognized wireless firms within this new, broad, 
economic census category. Prior to that time, such firms were within 
the now-superseded categories of Paging and Cellular and Other Wireless 
Telecommunications. Under the present and prior categories, the SBA has 
deemed a wireless business to be small if it has 1,500 or fewer 
employees. For this category, census data for 2007 show that there were 
11,163 establishments that operated for the entire year. Of this total, 
10,791 establishments had employment of 999 or fewer employees and 372 
had employment of 1000 employees or more. Thus, under this category and 
the associated small business size standard, the Commission estimates 
that the majority of wireless telecommunications carriers (except 
satellite) are small entities that may be affected by our proposed 
action.
    143. Similarly, according to Commission data, 413 carriers reported 
that they were engaged in the provision of wireless telephony, 
including cellular service, Personal Communications Service (PCS), and 
Specialized Mobile Radio (SMR) Telephony services. Of these, an 
estimated 261 have 1,500 or fewer employees and 152 have more than 
1,500 employees. Consequently, the Commission estimates that 
approximately half or more of these firms can be considered small. 
Thus, using available data, we estimate that the majority of wireless 
firms can be considered small.
    144. Cable and Other Program Distribution. Since 2007, these 
services have been defined within the broad economic census category of 
Wired Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.'' The SBA has developed a small business size standard 
for this category, which is: All such firms having 1,500 or fewer 
employees. Census data for 2007 shows that there were 31,996 
establishments that operated that year. Of those 31,996, 1,818 operated 
with more than 100 employees, and 30,178 operated with fewer than 100 
employees. Thus, under this size standard, the majority of firms 
offering cable and other program distribution services can be 
considered small and may be affected by rules adopted pursuant to the 
NPRM.
    145. Cable Companies and Systems. The Commission has developed its 
own small business size standards, for the purpose of cable rate 
regulation. Under the Commission's rules, a ``small cable company'' is 
one serving 400,000 or fewer subscribers, nationwide. Industry data 
indicate that, of 1,076 cable

[[Page 76238]]

operators nationwide, all but eleven are small under this size 
standard. In addition, under the Commission's rules, a ``small system'' 
is a cable system serving 15,000 or fewer subscribers. Industry data 
indicate that, of 6,635 systems nationwide, 5,802 systems have under 
10,000 subscribers, and an additional 302 systems have 10,000-19,999 
subscribers. Thus, under this second size standard, most cable systems 
are small and may be affected by rules adopted pursuant to the NPRM.
    146. All Other Telecommunications. The Census Bureau defines this 
industry as including ``establishments primarily engaged in providing 
specialized telecommunications services, such as satellite tracking, 
communications telemetry, and radar station operation. This industry 
also includes establishments primarily engaged in providing satellite 
terminal stations and associated facilities connected with one or more 
terrestrial systems and capable of transmitting telecommunications to, 
and receiving telecommunications from, satellite systems. 
Establishments providing Internet services or Voice over Internet 
Protocol (VoIP) services via client-supplied telecommunications 
connections are also included in this industry.'' The SBA has developed 
a small business size standard for this category; that size standard is 
$30.0 million or less in average annual receipts. According to Census 
Bureau data for 2007, there were 2,623 firms in this category that 
operated for the entire year. Of these, 2478 establishments had annual 
receipts of under $10 million and 145 establishments had annual 
receipts of $10 million or more. Consequently, we estimate that the 
majority of these firms are small entities that may be affected by our 
action.

D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities

    147. The Order requires covered providers to submit a certified 
report to the Commission once per calendar quarter that includes, for 
each full month in that quarter: (1) For each rural OCN, the OCN, the 
state, the total number of attempted interstate calls, the number of 
attempted interstate calls that were answered, and the number of 
attempted interstate calls that were not answered, reported separately 
for call attempts signaled as (a) busy, (b) ring no answer, or (c) 
unassigned number; (2) the same information described in (1), but for 
intrastate calls; (3) the same information regarding attempted 
interstate calls described in (1), but for nonrural OCNs in the 
aggregate; and (4) the same information regarding attempted intrastate 
calls described in (2), but for nonrural OCNs in the aggregate. The 
Order requires covered providers to record and retain the following 
information for each long-distance call to a local exchange carrier 
that is a rural telephone company: Calling party number; called party 
number; date; time of day; whether the call is handed off to an 
intermediate provider and, if so, which intermediate provider; whether 
the call is going to a rural carrier and, if so, which rural carrier, 
as identified by its operating company number (OCN); whether the call 
is interstate; whether the call attempt was answered; and whether the 
call attempt was completed to the incumbent local exchange carrier but 
signaled as busy, ring no answer, or unassigned number. The Commission 
requires covered providers to retain these records for a period 
including the six most recent calendar months for call attempts to 
rural ILECs; for those call attempts to nonrural ILECs, the rules do 
not require covered providers to retain records for any length of time. 
Compliance with these recordkeeping and retention obligations may 
affect small entities, and may include new administrative processes.
    148. In the Order, the Commission adopts a rule prohibiting all 
originating and intermediate providers--including LECs, IXCs, CMRS 
providers, interconnected VoIP, and one-way VoIP providers--from 
causing audible ringing to be sent to the caller before the terminating 
provider has signaled that the called party is being alerted. 
Compliance with these ring signaling integrity requirements may affect 
small entities, and may include new administrative processes.

E. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    149. The RFA requires an agency to describe any significant, 
specifically small business, alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): ``(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 and 
reporting requirements under the rules for such 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 such small 
entities.''
    150. The Commission is aware that some of the proposals under 
consideration will impact small entities by imposing costs and 
administrative burdens. For this reason, the Order includes a number of 
measures to minimize or eliminate the costs and burdens generated by 
compliance with the proposed rules.
    151. First, the recording, reporting, and retention rules adopted 
in the Order apply only to providers of long-distance voice service 
that make the initial long-distance call path choice for more than 
100,000 domestic retail subscriber lines, counting the total of all 
business and residential fixed subscriber lines and mobile phones and 
aggregated over all of the providers' affiliates. Accordingly, smaller 
providers are not required to comply with these rules.
    152. Additionally, the rule requiring retention of call detail 
records applies only to call attempts to rural incumbent LECs, a 
relatively small percentage of total call attempts; call attempts to 
nonrural incumbent LECs need not be retained. This approach should 
reduce the burden of compliance for smaller entities by reducing the 
costs of data storage that the rule proposed in the NPRM would have 
required, according to one estimate by as much as 90 percent. The Order 
also permits affiliated providers to record and report the information 
required individually or aggregated to the holding-company level, which 
should make it easier for smaller entities to record and report data in 
ways that are less burdensome to them.
    153. The rules adopted in the Order also include a safe harbor 
provision that could reduce the economic impact on small entities. The 
safe harbor relieves covered providers of their reporting obligations 
after one year and reduces their retention obligations if they certify 
that: They restrict by contract directly connected intermediate 
providers to no more than one additional intermediate provider in the 
call path before the call reaches the terminating provider; any 
nondisclosure agreement with an intermediate provider permits the 
covered provider to reveal the intermediate provider's identity to the 
Commission and to any rural carrier whose incoming long-distance 
traffic is affected by the intermediate provider's performance; and 
they have a process in place to monitor the performance of their 
intermediate providers.
    154. The Order delegates to the Wireline Competition Bureau, in 
consultation with the Enforcement Bureau, the authority to consider 
applications for waiver of the recordkeeping, retention, and reporting

[[Page 76239]]

requirements adopted in the Order. If approved, these waivers will 
reduce or eliminate a covered provider's recordkeeping, retention, or 
reporting obligations. In evaluating a provider's waiver request, the 
Bureau may consider: Whether a provider has demonstrated that it 
qualifies for the safe harbor; whether it persuasively demonstrates 
that it has processes in place to ensure that calls to rural incumbent 
LECs successfully reach their destinations, such as by adopting 
industry best practices; and whether the provider has demonstrated that 
it has capabilities and processes to monitor its own performance by the 
OCN of the called party's LEC. As a condition of a waiver, the Bureau 
will require a provider to report information about rural call 
completion for a one-year period, and such a report may be based on a 
statistically valid sample of calls. In addition, the Bureau may 
require, as a condition of a waiver, that a provider collect and retain 
some data, such as data reflecting a statistically valid sample of 
calls to rural and nonrural areas.
    155. The Commission considered the economic impact on small 
entities, as identified in comments filed in response to the NPRM, in 
reaching its final conclusions and taking action in this proceeding. In 
declining to adopt a sunset date for the rules, the Commission 
considered whether the rules should expire on a particular date to 
account for the possibility that reforms to the intercarrier 
compensation rules may alleviate many rural call completion problems. 
However, the Commission must ensure that it has the data necessary to 
adopt a long-term solution regarding the disparity in call completion 
rates between rural and nonrural areas. Moreover, while the bill-and-
keep transition should, to a large extent, eliminate the financial 
incentive structure that contributes to rural call completion problems, 
we conclude that rural call completion problems may not be solely 
attributable to terminating charges. Although declining to adopt a 
sunset provision could have an ongoing economic impact on both small 
and large entities, the Commission believes that any such impact is 
outweighed by the benefit of ensuring that the Commission continues to 
obtain the data necessary to address the rural call completion problem 
should the intercarrier compensation reforms alleviate only some of the 
issues plaguing long-distance call attempts to rural areas. 
Furthermore, to ensure that the data collection and reporting rules do 
not last without review in perpetuity, the Order states that the 
Commission shall complete a proceeding in which it reevaluates whether 
to keep, eliminate, or amend the data collection and reporting rules 
three years after they become effective. That time should be sufficient 
for the Commission and the public to review the data collected herein 
and determine whether the rules adopted today remain in the public 
interest going forward.
    156. The proposed ring signaling integrity requirements in the NPRM 
could have an economic impact on both small and large entities. 
However, the Commission believes that any impact of such requirements 
is outweighed by the accompanying benefits to the public and to the 
operation and efficiency of the long distance industry.

F. Report to Congress

    157. The Commission will send a copy of the Order, including this 
FRFA, in a report to be sent to Congress pursuant to the Congressional 
Review Act. 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 the Order and FRFA (or summaries thereof) will also be 
published in the Federal Register.

VI. Ordering Clauses

    Accordingly, it is ordered that, pursuant to sections 1, 4(i), 
201(b), 202(a), 218, 220(a), 251(a), and 403 of the Communications Act 
of 1934, as amended, 47 U.S.C. 151, 154(i), 201(b), 202(a), 218, 
220(a), 251(a), and 403, the Report and Order IS ADOPTED.
    It is further ordered that part 64 of the Commission's rules is 
amended as set forth in Appendix A of the Report and Order.
    It is further ordered that, pursuant to sections 1.4(b)(1) and 
1.103(a) of the Commission's rules, 47 CFR 1.4(b)(1), 1.103(a), this 
Report and Order shall be effective January 16, 2014, except for Sec.  
64.2201 of the Commission's rules, which will become effective January 
31, 2014, and Sec. Sec.  64.2103, 64.2105, and 64.2107 and the 
information collection in paragraph 67 of this Report and Order, which 
contains information collection requirements that have not been 
approved by Office of Management and Budget. The Federal Communications 
Commission will publish a document in the Federal Register announcing 
the effective date.
    it is further ordered that the Commission shall send a copy of this 
Report and Order to Congress and to the Government Accountability 
Office pursuant to the Congressional Review Act, see 5 U.S.C. 
801(a)(1)(A).
    It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Report and Order, including the Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration.

List of Subjects in 47 CFR Part 64

    Communications common carriers, Reporting and recordkeeping 
requirements, Telecommunications, Telephone.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR part 64 as follows:

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

0
1. The authority citation for part 64 continues to read as follows:

    Authority:  47 U.S.C. 154, 254(k); 403(b)(2)(B), (c), Pub. L. 
104-104, 110 Stat. 56. Interpret or apply 47 U.S.C. 201, 218, 222, 
225, 226, 227, 228, 254(k), 616, 620, and the Middle Class Tax 
Relief and Job Creation Act of 2012, Pub. L. 112-96, unless 
otherwise noted.

0
2. Add subpart V to part 64 to read as follows:

Subpart V--Recording, Retention and Reporting of Data on Long-
Distance Telephone Calls to Rural Areas and Reporting of Data on 
Long-Distance Telephone Calls to Nonrural Areas

Sec.
64.2101 Definitions.
64.2103 Retention of call attempt records.
64.2105 Reporting requirements.
64.2107 Reduced retention and reporting requirements for qualifying 
providers under the Safe Harbor.
64.2109 Disclosure of data.


Sec.  64.2101  Definitions.

    For purposes of this subpart, the following definitions will apply:
    Affiliate. The term ``affiliate'' has the same meaning as in 47 
U.S.C. 153(2).
    Call attempt. The term ``call attempt'' means a call that results 
in transmission by the covered provider toward an incumbent local 
exchange carrier (LEC) of the initial call setup message, regardless of 
the voice call signaling and transmission technology used.
    Covered provider. The term ``covered provider'' means a provider of 
long-distance voice service that makes the initial long-distance call 
path choice for more than 100,000 domestic retail subscriber lines, 
counting the total of all

[[Page 76240]]

business and residential fixed subscriber lines and mobile phones and 
aggregated over all of the providers' affiliates. A covered provider 
may be a local exchange carrier as defined in Sec.  64.4001(e), an 
interexchange carrier as defined in Sec.  64.4001(d), a provider of 
commercial mobile radio service as defined in Sec.  20.3 of this 
chapter, a provider of interconnected voice over Internet Protocol 
(VoIP) service as defined in 47 U.S.C. 153(25), or a provider of non-
interconnected VoIP service as defined in 47 U.S.C. 153(36) to the 
extent such a provider offers the capability to place calls to the 
public switched telephone network.
    Initial long-distance call path choice. The term ``initial long-
distance call path choice'' means the static or dynamic selection of 
the path for a long-distance call based on the called number of the 
individual call.
    Intermediate provider. The term ``intermediate provider'' has the 
same meaning as in Sec.  64.1600(f).
    Long-distance voice service. The term ``long-distance voice 
service'' includes interstate interLATA, intrastate interLATA, 
interstate interexchange, intrastate interexchange, inter-MTA 
interstate and inter-MTA intrastate voice services.
    Operating company number (OCN). The term ``operating company 
number'' means a four-place alphanumeric code that uniquely identifies 
a local exchange carrier.
    Rural OCN. The term ``rural OCN'' means an operating company number 
that uniquely identifies an incumbent LEC (as defined in Sec.  51.5 of 
this chapter) that is a rural telephone company (as defined in Sec.  
51.5 of this chapter). The term ``nonrural OCN'' means an operating 
company number that uniquely identifies an incumbent LEC (as defined in 
Sec.  51.5 of this chapter) that is not a rural telephone company (as 
defined in Sec.  51.5 of this chapter). We direct NECA to update the 
lists of rural and nonrural OCNs annually and provide them to the 
Wireline Competition Bureau in time for the Bureau to publish the lists 
no later than November 15. These lists will be the definitive lists of 
rural OCNs and nonrural OCNs for purposes of this subpart for the 
following calendar year.


Sec.  64.2103  Retention of call attempt records.

    (a) Except as described in Sec.  64.2107, each covered provider 
shall record and retain information about each call attempt to a rural 
OCN from subscriber lines for which the covered provider makes the 
initial long-distance call path choice in a readily retrievable form 
for a period that includes the six most recent complete calendar 
months.
    (b) Affiliated covered providers may record and retain the 
information required by this rule individually or in the aggregate.
    (c) A call attempt that is returned by an intermediate provider to 
the covered provider and reassigned shall count as a single call 
attempt.
    (d) Call attempts to toll-free numbers, as defined in Sec.  
52.101(f) of this chapter, are excluded from these requirements.
    (e) The information contained in each record shall include:
    (1) The calling party number;
    (2) The called party number;
    (3) The date;
    (4) The time;
    (5) An indication whether the call attempt was handed off to an 
intermediate provider or not and, if so, which intermediate provider;
    (6) The rural OCN associated with the called party number;
    (7) An indication whether the call attempt was interstate or 
intrastate;
    (8) An indication whether the call attempt was answered, which may 
take the form of an SS7 signaling cause code or SIP signaling message 
code associated with each call attempt; and
    (9) An indication whether the call attempt was completed to the 
incumbent local exchange carrier but signaled as busy, ring no answer, 
or unassigned number. This indication may take the form of an SS7 
signaling cause code or SIP signaling message code associated with each 
call attempt.


Sec.  64.2105  Reporting requirements.

    (a) Except as described in Sec.  64.2107, each covered provider 
shall submit a certified report to the Commission in electronic form on 
the following quarterly schedule: February 1 (reflecting monthly data 
from October through December), May 1 (reflecting monthly data from 
January through March), August 1 (reflecting monthly data from April 
through June), and November 1 (reflecting monthly data from July 
through September). An officer or director of each covered provider 
must certify to the accuracy of each report.
    (b) The information contained in the certified report shall include 
the following information about subscriber lines for which the covered 
provider makes the initial long-distance call path choice, reported 
separately for each month in that quarter:
    (1) For each rural OCN:
    (i) The OCN;
    (ii) The State;
    (iii) The number of interstate call attempts;
    (iv) The number of interstate call attempts that were answered;
    (v) The number of interstate call attempts that were not answered, 
reported separately for call attempts signaled as busy, ring no answer, 
or unassigned number;
    (vi) The number of intrastate call attempts;
    (vii) The number of intrastate call attempts that were answered; 
and
    (viii) The number of intrastate call attempts that were not 
answered, reported separately for call attempts signaled as busy, ring 
no answer, or unassigned number.
    (2) For nonrural OCNs in the aggregate:
    (i) The number of interstate call attempts;
    (ii) The number of interstate call attempts that were answered;
    (iii) The number of interstate call attempts that were not 
answered, reported separately for call attempts signaled as busy, ring 
no answer, or unassigned number;
    (iv) The number of intrastate call attempts;
    (v) The number of intrastate call attempts that were answered; and
    (vi) The number of intrastate call attempts that were not answered, 
reported separately for call attempts signaled as busy, ring no answer, 
or unassigned number.
    (c) In reporting the information described in paragraph (b) of this 
section, a covered provider may disaggregate calls originated by 
automatic telephone dialing systems (as defined in Sec.  64.1200(f)) if 
it includes an explanation of the method used to identify those calls.
    (d) Affiliated covered providers may report this information 
individually or in the aggregate.


Sec.  64.2107  Reduced retention and reporting requirements for 
qualifying providers under the Safe Harbor.

    (a)(1) A covered provider may reduce its retention and reporting 
obligations under this subpart if it files one of the following 
certifications, signed by an officer or director of the covered 
provider regarding the accuracy and completeness of the information 
provided, in WC Docket No. 13-39 on any of the four quarterly filing 
dates established in Sec.  64.2105 and annually thereafter.
    I ------ (name), ------ (title), an officer of ------ (entity), 
certify that ------ (entity) uses no intermediate providers;
    or
    I ------ (name), ------ (title), an officer of ------ (entity), 
certify that

[[Page 76241]]

------ (entity) restricts by contract any intermediate provider to 
which a call is directed by ------ (entity) from permitting more than 
one additional intermediate provider in the call path before the call 
reaches the terminating provider or terminating tandem. I certify that 
any nondisclosure agreement with an intermediate provider permits ----
-- (entity) to reveal the identity of the intermediate provider and any 
additional intermediate provider to the Commission and to the rural 
incumbent local exchange carrier(s) whose incoming long-distance calls 
are affected by the intermediate provider's performance. I certify that 
------ (entity) has a process in place to monitor the performance of 
its intermediate providers.
    (2) Covered providers that file the second certification must 
describe the process they have in place to monitor the performance of 
their intermediate providers.
    (b) A covered provider that meets the requirements described in 
paragraph (a) of this section must comply with the data retention 
requirements in Sec.  64.2103 for a period that includes only the three 
most recent complete calendar months, so long as it continues to meet 
the requirements of paragraph (a) of this section. A covered provider 
that ceases to meet the requirements described in paragraph (a) of this 
must immediately begin retaining data for six months, as required by 
Sec.  64.2103.
    (c) A covered provider that meets the requirements described in 
paragraph (a) of this section must comply with the reporting 
requirements in Sec.  64.2105 for a period of one year commencing when 
it first filed the certification described in paragraph (a) of this 
section, so long as it continues to meet those paragraph (a) of this 
section requirements. A covered provider that ceases to meet the 
requirements described in paragraph (a) of this section must begin 
filing the reports required by Sec.  64.2105 on the next filing 
deadline.
    (d) Affiliated covered providers may meet the requirements of 
paragraph (a) of this section individually or in the aggregate.


Sec.  64.2109  Disclosure of data.

    (a) Providers subject to the reporting requirements in Sec.  
64.2105 of this chapter may make requests for Commission nondisclosure 
of the data submitted under Sec.  0.459 of this chapter by so 
indicating on the report at the time that the data are submitted.
    (b) The Chief of the Wireline Competition Bureau will release 
information to states upon request, if the states are able to maintain 
the confidentiality of this information.

0
3. Add subpart W, consisting of Sec.  64.2201, to read as follows:

Subpart W--Ring Signaling Integrity


Sec.  64.2201  Ringing indication requirements.

    (a) A long-distance voice service provider shall not convey a 
ringing indication to the calling party until the terminating provider 
has signaled that the called party is being alerted to an incoming 
call, such as by ringing.
    (1) If the terminating provider signals that the called party is 
being alerted and provides an audio tone or announcement, originating 
providers must cease any locally generated audible tone or announcement 
and convey the terminating provider's tone or announcement to the 
calling party.
    (2) The requirements in this paragraph apply to all voice call 
signaling and transmission technologies and to all long-distance voice 
service providers, including local exchange carriers as defined in 
Sec.  64.4001(e), interexchange carriers as defined in Sec.  
64.4001(d), providers of commercial mobile radio service as defined in 
Sec.  20.3 of this chapter, providers of interconnected voice over 
Internet Protocol (VoIP) service as defined in 47 U.S.C. 153(25), and 
providers of non-interconnected VoIP service as defined in 47 U.S.C. 
153(36) to the extent such providers offer the capability to place 
calls to or receive calls from the public switched telephone network.
    (b) Intermediate providers must return unaltered to providers in 
the call path any signaling information that indicates that the 
terminating provider is alerting the called party, such as by ringing.
    (1) An intermediate provider may not generate signaling information 
that indicates the terminating provider is alerting the called party. 
An intermediate provider must pass the signaling information indicating 
that the called party is being alerted unaltered to subsequent 
providers in the call path.
    (2) Intermediate providers must also return unaltered any audio 
tone or announcement provided by the terminating provider.
    (3) In this section, the term ``intermediate provider'' has the 
same meaning as in Sec.  64.1600(f).
    (4) The requirements in this section apply to all voice call 
signaling and transmission technologies.
    (c) The requirements in paragraphs (a) and (b) of this section 
apply to both interstate and intrastate calls, as well as to both 
originating and terminating international calls while they are within 
the United States.

[FR Doc. 2013-29867 Filed 12-16-13; 8:45 am]
BILLING CODE 6712-01-P