The FCC reported that high-speed connections to the Internet increased 18% in the first half of 2003, raising the total of lines in the U.S. to 23.5 million. The increase was 45% for the 12-month period ended June 30, and cable led among service providers in growth. Although the data showed the uptake to be strong, the pace of growth appeared to ebb a bit. High-speed Internet lines connecting homes and businesses gained 18%, to 23.5 million lines as of June 30 from 19.9 million, compared with a 23% increase, to 19.9 million lines from 16.2 million, in the 2nd half of 2002.

NeuStar, the Direct Mktg. Assn. (DMA) and the Newspaper Assn. of America (NAA) told the FCC they were working out the details of a data file that would allow telemarketers to meet regulatory obligations in the face of wireless local number portability (LNP). DMA had raised concerns on how telemarketers could be notified when a wireline number changed to wireless following the Nov. 24 implementation of wireless LNP. The Telephone Consumer Protection Act (TCPA) prohibits autodialed telemarketing calls to wireless phones. NeuStar had suggested several possibilities to address that notification problem, including a secure Web site for telemarketers receiving routine updates on wireless numbers. DMA, NAA and NeuStar outlined for the Commission last week a file-based service that would feature a secure Web site for telemarketers using autodialing technology to download information on newly ported wireless numbers. The groups plan to create a mechanism for accessing such data, the frequency of providing the data, the actual information required, restrictions on data use and the service’s pricing. In an ex parte filing, they said: “It was acknowledged that there is a regulatory element impacting entities that need to comply with TCPA to complete resolution in view of the varying ways telemarketing programs are carried out, but this issue does not involve NeuStar and will be addressed by the interested parties with the FCC once the specifics of the wireline-wireless porting data program are resolved.”

European satellite operators have had “serious difficulties” gaining access to the U.S. market based on FCC applications of the DISCO 2 public interest framework and the ORBIT Act, according to a European report on trade barriers. The annual Report on U.S. Barriers to Trade & Investment is intended to “provide an overview of the obstacles that EU exporters and investors encounter in the U.S.,” it said. EU said it had concerns that ORBIT provisions weren’t applied equally and that “if it is used against EU operators’ interests, the EU reserves its right to seek arbitration procedures under the WTO.” The report used Inmarsat, New Skies and SES Global as examples of the difficulties European companies experienced in requesting access. Inmarsat was granted access conditioned on a post-IPO review. New Skies was granted access for 3 years in 1999 and in Jan. its NSS 8 was approved to serve the U.S. fixed satellite service (FSS) industry, the report said. Despite its ITU priority, Eutelsat was required by the U.S. to coordinate with Loral Skynet to use an orbit location for FSS services. While Eutelsat customers did receive FCC authority to access the satellite, the report said, “this case, in which the FCC appears to have leveraged it regulatory clout to the advantage of Loral, raised questions about the compatibility of U.S. domestic procedures with the [General Agreement on Trade in Services (GATS)] provision on Domestic Regulation.” SES Global was authorized in Aug. provide capacity for direct-to-home services to U.S. FSS facilities, the report said. “These cases show that proceedings by the FCC on spectrum allocation and licensing are not always carried out in an objective, transparent, timely and non- discriminatory manner, and they have raised concerns regarding their compatibility with U.S. WTO commitments,” it said. The report mentioned negotiations on GPS-Galileo coordination briefly, saying both the U.S. and EU understood that a bilateral agreement on coordination must be “within the existing international trade system and consistent with relevant WTO multilateral rules.” The report also mentioned: (1) The lack of available U.S. frequencies allocated for 3G mobile communications systems. While the FCC and NTIA have identified some 3G spectrum, “additional steps are required, in particular existing users must be relocated,” the report said: “In particular it is necessary to ensure that the U.S. market is open to European and foreign country operators that are potential new entrants in the market… [and] to ensure compatibility between the 3G frequency bands in the U.S. and EU so as to facilitate roaming between the U.S. and EU via multimodal terminals.” (2) Digital terrestrial TV compatibility between the U.S. and EU. The report said adoption of the ATSC standard had prevented development of the DVB-T standard in Europe, a “clear contradiction with U.S. government calls for technological neutrality and market-driven approaches in other sectors.” The mandate that TV receivers have digital TV reception capability after July 1, 2007, will strengthen the position of the ATSC standard, the report said.

With Corp. for Public Bcstg. (CPB) reauthorization a near certainty in Congress next year, public broadcasting leaders are opposing Hill proposals to give CPB more power to deal with bias complaints about PBS programs such as Now With Bill Moyers. Sen. Lott (R-Miss.) raised the issue at a Senate Commerce Committee confirmation hearing for 2 CPB nominees Nov. 13, and public broadcasting leaders believe their authority to deal with such problems will be prominent at the reauthorization hearings. Members of Congress need to know CPB was created to be a “heat shield” from Congress, said Beth Courtney, who was confirmed to the CPB board by the Senate this month.

The FCC unanimously approved rules Wed. to improve administration of its e-rate program, including allowing $420 million in unused schools and libraries funds to be carried forward for disbursement in 2003. The Commission at its agenda meeting also adopted procedural safeguards, including: (1) Barring the transfer of equipment purchased with universal service discounts to other locations for 3 years after purchase, except in limited cases, such as a school’s closing. (2) Increasing the transparency of updating an annual list of services eligible for support. (3) Supporting internal connections upgrades and replacements no more than twice every 5 years, except for basic maintenance services.

Indicating the complexity of setting voice-over-Internet protocol (VoIP) rules, major federal law enforcers asked the FCC to set CALEA rules that would “ensure that no new loophole is created that allows criminals, terrorists and spies to use VoIP services to avoid lawfully authorized surveillance.” At the same time, the Electronic Privacy Information Center (EPIC) said the FCC should “ensure the establishment of strong privacy safeguards” for VoIP.” And SBC said the FCC shouldn’t allow AT&T to avoid access charges for phone calls that traveled partly over an IP backbone.

In continued back-and-forth at the FCC on the 800 MHz proceeding, Nextel shot back at a CTIA filing earlier this month that argued that the “consensus plan” to realign that spectrum would violate the competitive bidding provisions of Sec. 309(j) of the Communications Act. Nextel accused the plan’s opponents of unleashing a “campaign of misinformation” in the last few weeks, “audaciously twisting the application of regulation to serve their myopic interest.” In its latest filing, Nextel argued that the FCC had full legal authority to approve the consensus plan, which also was backed by some private wireless groups, PCIA and the Assn. of Public Safety Communications Officials. The plan is designed to mitigate interference to public safety operations at 800 MHz and would involve reconfiguring parts of 700, 800 and 900 MHz. CTIA’s most recent criticism had focused on the part of the plan that would give Nextel a nationwide license for 10 MHz at 1.9 GHz as part of a spectrum swap for capacity it was giving up in other bands. CTIA raised concerns about the extent to which the proposal would run counter to Sec. 309(j), which outlined the principals for the FCC’s offering spectrum at auction and would circumvent the Commission’s standard license assignment process. “CTIA applies inapposite precedent, distorts the comparative value of Nextel’s current licenses and proposed replacement spectrum and ignores the enormous societal benefits that would result from the consensus plan,” Nextel told the FCC. “The Commission should reject this last-ditch effort, and should instead move expeditiously to adopt the consensus plan in its entirety.” Nextel, a member of CTIA, told the Commission that this was not the first time the group had weighed in at the 11th hour in a spectrum proceeding to raise new arguments. Nextel cited the mobile satellite service rulemaking, in which CTIA argued late in the proceeding about potential interference to 1.9 GHz PCS operations. As for the 800 MHz proceeding, Nextel said it could implement the consensus plan and modify its licenses without triggering the competitive bidding requirements of Sec. 309(j). Nextel contended that provision applied only to the awarding of initial licenses. Instead, it said, the consensus plan would be modifying only Nextel’s already existing licenses. It said the FCC had authority to assign that spectrum to Nextel as a license modification under Sec. 316 of the Act. Nextel said important public interest provisions underlay the competitive bidding provisions of Sec. 309. “In the case of the 800 MHz proceeding, however, the compelling public interest benefits that would result from the consensus plan outweigh the public interest in spectrum auctions,” Nextel said. Nextel Vp-Govt. Affairs Lawrence Krevor said: “The consensus plan will eliminate the dangerous problem of public safety radio interference and we look forward to CTIA rallying to the cause.”

Crown Castle told the FCC it had concerns with part of a draft national program agreement designed to streamline the review process for sites under the National Historic Preservation Act. The draft agreement would streamline the process for communications facilities under Sec. 106 of the act. A similar agreement in 2001 had focused on colocation on existing towers, while the draft would cover new sites. Crown Castle raised concerns over an exclusion in the draft agreement that said that a tower modification that didn’t involve a colocation and didn’t substantially increase the size of the tower was an undertaking that would be excluded from Sec. 106 review. Crown Castle said it agreed with the proposed exclusion but said such actions weren’t properly deemed “undertakings” because they didn’t require a federal permit, license or approval. Such changes, which could involve replacing a fence around a tower site, could otherwise become subject to tribal consultation, Crown Castle said. That would be the case if language proposed by the Navajo Nation were included in the final agreement, the company said. Improperly classifying such activities as undertakings would “be an improper extension of the FCC’s authority and would thus be subject to judicial challenge,” it said. Without changing the language using “undertaking,” Crown Castle said the proposed exclusion could have unintended consequences: “The notion of what ‘is’ and ‘is not’ an undertaking will be blurred. As a result, the overall scope of the FCC’s Section 106 and other environmental obligations may expand as other types of ‘modifications’… that are not related directly to the issuance of an FCC license are considered to be undertakings that are subject to direct FCC authority.”

Tackling a dispute about how the FCC conducts its biennial reviews of regulations, the U.S. Appeals Court, D.C., indicated Mon. it might side with the Commission on one of the complaints raised by Verizon. The panel’s view on another key issue involving standards was unclear. The case centered on the Telecom Act’s requirement that the FCC review telecom regulations every 2 years to determine whether they still were needed in light of competition. Judges Merrick Garland, Raymond Randolph and Judith Rogers sat on the panel.

The National Telecom Co-op Assn. (NTCA) and OPASTCO asked the U.S. Appeals Court, D.C., to review parts of a recent FCC order on wireline-to-wireless local number portability (LNP) requirements that affect small, rural LECs. The groups told the D.C. Circuit in their petition that the FCC didn’t comply with the Regulatory Flexibility Act and Administrative Procedure Act when adopting a intermodal LNP order last month. NTCA and OPASTCO were part of a group of rural carriers that petitioned the FCC last month on behalf of so-called 2% carriers, or those that individually serve less than 2% of phone consumers in the U.S. In the petition at the FCC, on which the agency still hasn’t acted, the rural carriers contended that the Nov. 7 order created unintentional consequences for rural carriers in the top 100 markets. Wireless LNP went into effect in the top 100 metropolitan statistical areas on Nov. 24. They said that in setting that deadline for carriers to support wireline-to- wireless porting in those markets, the agency didn’t consider the fact that some 2% carriers also were located in those markets. The groups also argued that the FCC failed to address key technical and compensation issues, which must be resolved before these 2% carriers can effectively implement intermodal LNP. The D.C. Circuit recently rejected a petition by rural carriers seeking a stay of the wireless-to- wireless porting rules. Meanwhile, the FCC turned down a petition concerning its intermodal rules raised by USTA and CenturyTel.