346. Accordingly, IT IS ORDERED that, pursuant to sections 3, 4, 201(b), 218, 230, 231, 257, 303, 309, 332, 403, 501, and 503 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 153, 154, 201(b), 218, 230, 231, 257, 303, 309, 332, 403, 501, 503, this Declaratory Ruling, Report and Order, and Order IS ADOPTED.
347. IT IS FURTHER ORDERED that parts 1, 8, and 20 of the Commission’s rules ARE AMENDED as set forth in Appendix A.
348. IT IS FURTHER ORDERED that this Declaratory Ruling, Report and Order, and Order SHALL BE effective 60 days after publication in the Federal Register, except that those amendments which contain new or modified information collection requirements that require approval by the Office of Management and Budget under the Paperwork Reduction Act WILL BECOME EFFECTIVE after the Commission publishes a notice in the Federal Register announcing such approval and the relevant effective date. It is our intention in adopting the foregoing Declaratory Ruling and these rule changes that, if any provision of the Declaratory Ruling or the rules, or the application thereof to any person or
1149 See Letter from Wireline Competition Bureau, FCC, to Marlene Dortch, Secretary, FCC, GN Docket No. 09-191, WC Docket No. 07-52 (filed Dec. 13, 2010).
circumstance, is held to be unlawful, the remaining portions of such Declaratory Ruling and the rules not deemed unlawful, and the application of such Declaratory Ruling and the rules to other person or
circumstances, shall remain in effect to the fullest extent permitted by law.
349. IT IS FURTHER ORDERED that the INCOMPAS Petition to Modify Protective Orders is DENIED.
350. IT IS FURTHER ORDERED that the National Hispanic Media Coalition (NHMC) Motion Regarding Informal Consumer Complaints is DENIED.
351. IT IS FURTHER ORDERED that the Commission’s Consumer & Governmental Affairs Bureau, Reference Information Center, SHALL SEND a copy of this Declaratory Ruling, Report and Order, and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
352. IT IS FURTHER ORDERED that the Commission’s Consumer & Governmental Affairs
Bureau, Reference Information Center, SHALL SEND a copy of this Declaratory Ruling, Report and
Order, and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy
of the Small Business Administration.
APPENDIX A Final Rules
The Federal Communications Commission amends 47 CFR Parts 1, 8, and 20 as follows:
PART 1 – PRACTICE AND PROCEDURE
1. Amend section 1.49 by revising paragraph (f)(1)(i) to read as follows:
§ 1.49 Specifications as to pleadings and documents.
* * * * * (f) * * * (1) * * *
(i) Formal complaint proceedings under Section 208 of the Act and rules in §§1.720 through 1.736, and pole attachment complaint proceedings under Section 224 of the Act and rules in §§1.1401 through 1.1424;
* * * * *
2. Amend the heading of part 8 to read as follows:
PART 8: INTERNET FREEDOM
3. Amend the authority citation for part 8 to read as follows:
AUTHORITY: 47 U.S.C. §§ 154, 201(b), 218, 257, and 303.
4. Amend section 8.1 to read as follows:
§8.1 Transparency.
(a) Any person providing broadband Internet access service shall publicly disclose accurate information regarding the network management practices, performance, and commercial terms of its broadband Internet access services sufficient to enable consumers to make informed choices regarding the purchase and use of such services and entrepreneurs and other small businesses to develop, market, and maintain Internet offerings. Such disclosure shall be made via a publicly available, easily accessible website or through transmittal to the Commission.
(b) Broadband Internet access service is a mass-market retail service by wire or radio that provides the capability to transmit data to and receive data from all or substantially all Internet endpoints, including any capabilities that are incidental to and enable the operation of the communications service, but excluding dial-up Internet access service. This term also encompasses any service that the Commission finds to be providing a functional equivalent of the service described in the previous sentence or that is used to evade the protections set forth in this part.
(c) A network management practice is reasonable if it is appropriate and tailored to achieving a legitimate network management purpose, taking into account the particular network architecture and technology of the broadband Internet access service.
5. Remove and delete in their entirety sections 8.2, 8.3, 8.5, 8.7, 8.9, 8.11, 8.12, 8.13, 8.14, 8.15, 8.16, 8.17, 8.18, and 8.19.
PART 20: COMMERCIAL MOBILE SERVICES
6. Amend Section 20.3 as follows:
§ 20.3 Definitions.
* * * * *
Commercial mobile radio service. * * *
* * * * *
(b) The functional equivalent of such a mobile service described in paragraph (a) of this section.
* * * * *
Interconnected Service. A service:
(a) That is interconnected with the public switched network, or interconnected with the public switched network through an interconnected service provider, that gives subscribers the capability to communicate to or receive communication from all other users on the public switched network; or
(b) * * *
* * * * *
Public Switched Network. The network that includes any common carrier switched network, whether by
wire or radio, including local exchange carriers, interexchange carriers, and mobile service providers, that
uses the North American Numbering Plan in connection with the provision of switched services.
APPENDIX B
Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980 (RFA),
1150as amended, Initial Regulatory Flexibility Analysis (IRFAs) was incorporated in the Notice of Proposed Rule Making (Internet Freedom NPRM) for this proceeding.
1151The Commission sought written public comment on the proposals in the Internet Freedom NPRM, including comment on the IRFA. The Commission received comments on the Internet Freedom NPRM IRFA, which are discussed below.
1152This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.
1153A. Need for, and Objectives of, the Final Rules
1. In order to return the Internet to the light-touch regulatory environment that allowed investment to increase and consumers to benefit, we return broadband Internet access service to its longstanding classification as an information service,
1154and eliminate several rules adopted in the Title II Order, including the general conduct standard, the ban on paid prioritization, and the blocking and no-throttling rules.
1155We retain the transparency rule adopted in the Open Internet Order,
1156with
modifications, while eliminating the additional reporting obligations created in the Title II Order, the Title II Order’s direct notification requirement, and the broadband label “safe harbor.”
11572. We also eliminate the formal complaint procedures under Part 8 of the Act, because the informal complaint procedures are sufficient.
1158We eliminate the other components of the enforcement regime created in the Title II Order, including the position of Open Internet Ombudsperson and the issuance of advisory opinions.
1159We also return mobile broadband Internet access service to its longstanding definition as a private mobile radio service under section 332 of the Communications Act.
11603. The transparency rule we adopt is necessary because properly tailored transparency disclosures provide valuable information to the Commission to enable it to meet its statutory obligation to observe the communications marketplace to monitor the introduction of new services and technologies, and to identify and eliminate potential marketplace barriers for the provision of information service. Such disclosures also provide valuable information to other Internet ecosystem participants; transparency substantially reduces the possibility that ISPs will engage in harmful practices, and it incentivizes quick corrective measures by providers if problematic conduct is identified. Appropriate disclosures help
1150 5 U.S.C. § 603. The RFA, 5 U.S.C. §§ 601-612 has been amended by the Contract With America Advancement Act of 1996, Public Law No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).
1151 Restoring Internet Freedom, Notice of Proposed Rulemaking, 32 FCC Rcd 4434 (2017) (Internet Freedom NPRM).
1152 See, e.g., WISPA Comments at 2.
1153 See 5 U.S.C. § 604.
1154 See supra Part III.A.
1155 See supra Part IV.B.
1156 See supra Part IV.B.2.
1157 See id.
1158 See supra Part IV.C.
1159 See id.
1160 See supra Part III.B.
consumers make informed choices about their purchase and use of broadband services. Moreover, clear disclosures improve consumer confidence in ISPs’ practices, ultimately increasing user adoption and leading to additional investment and innovation, while providing startups and other edge providers the necessary information to innovate and improve products.
4. Our enforcement changes will ensure that ISPs will be held accountable for any
violations of the transparency rule. We eliminate the formal complaint procedures because the informal complaint procedure, in conjunction with other redress options including consumer protection laws, will sufficiently protect consumers. Additionally, we eliminate the position of Open Internet Ombudsperson because the staff from the Consumer and Governmental Affairs Bureau—other than the Ombudsperson—
have been performing the Ombudsperson functions envisioned by the Title II Order. We also eliminate the issuance of enforcement advisory opinions, because enforcement advisory opinions do not diminish regulatory uncertainty, particularly for small providers. Instead, they add costs and uncertain timelines since there is no specific timeframe within which to act, which can also inhibit innovation.
5. We return mobile broadband Internet access service to its original classification as a private mobile radio service because we find that the definitions of the terms “public switched network”
and “interconnected service” that the Commission adopted in the 1994 Second CMRS Report and Order reflect a better reading of the Act. Accordingly, we readopt those definitions.
6. We restore the definition of interconnected service that existed prior to the Title II Order.
Prior to that Order, the term “interconnected service” was defined under the Commission’s rules as a service “that gives subscribers the capability to communicate to or receive communication from all other users on the public switched network.” The Title II Order modified this definition by deleting the word
“all,” finding that mobile broadband Internet access service should still be considered an interconnected service even if it only enabled users to communicate with “some” other users of the public switched network rather than all. We conclude that the better reading of “interconnected service” is one that enables communication between its users and all other users of the public switched network.
7. The legal basis for the rules we adopt today includes sections 3, 4, 201(b), 218, 230, 231, 257, 303, 309, 332, 403, 501, and 503 of the Communications Act of 1934, as amended, 47 U.S.C.
§§ 153, 154, 201(b), 218, 230, 231, 257, 303, 309, 332, 403, 501, 503. The transparency rule we adopt today relies on multiple sources of legal authority, including section 257, section 218, and Title III of the Communications Act.
8. Section 257 requires the Commission to make triennial reports to Congress, and those triennial reports must identify “market entry barriers for entrepreneurs and other small businesses in the provision and ownership of telecommunications services and information services.”
1161By requiring disclosures, the transparency rule will aid in the elimination of barriers to entry. Section 218, which applies to all ISPs that are common carriers by virtue of additional services they offer, directs the Commission to “keep itself informed as to the manner and method in which the [business of carriers] is conducted and as to technical developments and improvements in wire and radio communication and radio transmission of energy to the end that the benefits of new inventions and developments may be made available to the people of the United States.”
11629. Our Title III licensing authority also supports application of the transparency rule to wireless ISPs. The Commission has previously relied on its Title III licensing authority to apply the transparency rule to wireless ISPs, and it retains that authority today.
B. Summary of Significant Issues Raised by Public Comments to the IRFA
10. The Wireless Internet Service Providers Association (WISPA) argued that the IRFA was
1161 47 U.S.C. § 257.
1162 47 U.S.C. § 218.
incomplete and inaccurate.
1163C. Response to Comments by the Chief Counsel for Advocacy of the Small Business Administration
11. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel of the Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rule(s) as a result of those comments.
116412. The Chief Counsel did not file any comments in response to the proposed rule(s) in this proceeding.
D. Description and Estimate of the Number of Small Entities to Which the Final Rule May Apply
13. 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.
1165The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,”
“small organization,” and “small governmental jurisdiction.”
1166In addition, the term “small business”
has the same meaning as the term “small business concern” under the Small Business Act.
1167A small business concern is one that: (1) is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).
1168Nationwide, there are a total of approximately 28.2 million small businesses, according to the SBA.
1169A “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.”
11701. Total Small Entities
14.
Small Entities, Small Organizations, Small Governmental Jurisdictions. Our actions,over time, may affect small entities that are not easily categorized at present. We therefore describe here, at the outset, three comprehensive small entity size standards that could be directly affected herein.
1171First, while there are industry specific size standards for small businesses that are used in the regulatory flexibility analysis, according to data from the SBA’s Office of Advocacy, in general a small business is an independent business having fewer than 500 employees.
1172These types of small businesses represent
1163 Letter from S. Jenell Trigg, Counsel to WISPA, to Marlene H. Dortch, FCC Secretary, WC Docket No. 17-108, at 2 (filed May 10, 2017) (“WISPA Ex Parte Letter”).
1164 5 U.S.C. § 604(a)(3).
1165 5 U.S.C. § 603(b)(3).
1166 5 U.S.C. § 601(6).
1167 5 U.S.C. § 601(3) (incorporating by reference the definition of “small business concern” in 15 U.S.C. § 632).
Pursuant to the RFA, the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.” 5 U.S.C. § 601(3).
1168 See 15 U.S.C. § 632.
1169 See SBA, Office of Advocacy, “Frequently Asked Questions,”
http://www.sba.gov/sites/default/files/FAQ_March_2014_0.pdf (last visited Mar. 8, 2016).
1170 5 U.S.C. § 601(4).
1171 See 5 U.S.C. § 601(3)-(6).
1172 See SBA, Office of Advocacy, “Frequently Asked Questions, Question 1 – What is a small business?”
https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf (June 2016)
99.9% of all businesses in the United States which translates to 28.8 million businesses.
1173Next, the type of small entity described as a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.”
1174Nationwide, as of Aug 2016, there were approximately 356,494 small organizations based on registration and tax data filed by nonprofits with the Internal Revenue Service (IRS). Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.”
1175U.S. Census Bureau data from the 2012 Census of Governments
1176indicates that there were 90,056 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States.
1177Of this number there were 37, 132 General purpose governments (county
1178, municipal and town or township
1179) with populations of less than 50,000 and 12,184 Special purpose governments (independent school districts
1180and special districts
1181) with populations of less than 50,000. The 2012 U.S. Census Bureau data for most types of governments in the local government category shows that the majority of these governments have populations of less than 50,000.
1182Based on this data we estimate
1173 See SBA, Office of Advocacy, “Frequently Asked Questions, Question 2- How many small business are there in the U.S.?” https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf (June 2016).
1174 5 U.S.C. § 601(4).
1175 5 U.S.C. § 601(5).
1176 See 13 U.S.C. § 161. The Census of Government is conducted every five (5) years compiling data for years ending with “2” and “7”. See also Program Description Census of Government,
https://factfinder.census.gov/faces/affhelp/jsf/pages/metadata.xhtml?lang=en&type=program&id=program.en.COG#
.
1177 See U.S. Census Bureau, 2012 Census of Governments, Local Governments by Type and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG02.US01. Local governmental jurisdictions are classified in two categories - General purpose governments (county, municipal and town or township) and Special purpose governments (special districts and independent school districts).
1178 See U.S. Census Bureau, 2012 Census of Governments, County Governments by Population-Size Group and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01. There were 2,114 county governments with populations less than 50,000.
1179 See U.S. Census Bureau, 2012 Census of Governments, Subcounty General-Purpose Governments by Population-Size Group and State: 2012 - United States – States.
https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01. There were 18,811 municipal and 16,207 town and township governments with populations less than 50,000.
1180 See U.S. Census Bureau, 2012 Census of Governments, Elementary and Secondary School Systems by Enrollment-Size Group and State: 2012 - United States-States.
https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. There were 12,184 independent school districts with enrollment populations less than 50,000.
1181 See U.S. Census Bureau, 2012 Census of Governments, Special District Governments by Function and State:
2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG09.US01. The U.S.
Census Bureau data did not provide a population breakout for special district governments.
1182 See U.S. Census Bureau, 2012 Census of Governments, County Governments by Population-Size Group and State: 2012 - United States-States - https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01;
Subcounty General-Purpose Governments by Population-Size Group and State: 2012 - United States–States - https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01; and Elementary and Secondary School Systems by Enrollment-Size Group and State: 2012 - United States-States.
https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. While U.S. Census Bureau data did not provide a population breakout for special district governments, if the population of less than 50,000 for this category of local government is consistent with the other types of local governments the majority of the 38, 266 special district governments have populations of less than 50,000.