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This third entry on the FCC’s ongoing review of RF exposure limits highlights the Notice of Inquiry that focuses on possible changes to the current RF exposure limits.

The NOI reiterates that the current exposure limits were adopted in 1996 and while expressing confidence in these limits, the NOI observes that intervening research studies, the ubiquity of device adoption, advances in technology, and developments in international standards support updating the record on RF exposure limits. Accordingly, the NOI seeks comment on whether the current exposure limits should be changed, and the costs and benefits of any suggested changes. The FCC explains its “intent is to adequately protect the public without imposing an undue burden on industry.” It adds that its goal “is to open a science-based examination of the efficacy, currency, and adequacy of the Commission’s exposure limits for RF electromagnetic fields.”

The tenor of the NOI is that, while safety concerns regarding the exposure limits have not been scientifically substantiated, there is extensive research and standards bodies activity on many aspects related to RF exposure.  These include partial-body and whole-body averaging of exposure; averaging area for power density; averaging time for limits; among others. The FCC must review a vast array of technical studies and information compiled since the adoption of the current limits as the agency considers whether and how to proceed. The views of other federal agencies with health and safety expertise will be particularly important to the FCC in this process.

Specific issues raised in the NOI may categorized as follows:

Exposure Limits. Issues of interest to the FCC include partial-body and whole-body averaging of exposure; averaging area and averaging time considerations; whether there should be peak pulsed field limits and/or limits on contact RF currents; whether the frequency range for FCC limits should be broadened from the current 100 kHz-100 GHz range; and conductive implanted objects.

Consumer Information. The FCC notes that it makes a variety of information on RF electromagnetic fields available to the public, but it seeks comment on whether it should make additional information available. If so, what form would be most useful to the public. It also asks whether it should require that more information be made available in equipment manuals, at point-of-sale, or on websites.

Exposure Reduction Policies. The FCC asks whether, in addition to its current “conservative, bright line limit[s]”, it should consider a general technical approach to reduce exposure below its limits in some situations, requesting  comment on cost-benefit and other trade-offs of such an approach and that interested parties specify the specific circumstances, tangible benefits, and impact on the cost and performance of  such an approach.

Evaluation. The FCC defines evaluation as “the determination of compliance with its exposure limits by measurement or computation.” The FCC requests comment on the pros and cons of measurement versus computation and variants thereof. In addition, the FCC requests comments on the effectiveness of its SAR and MPE limits in certain situations and whether any of the non-bindings matters in its Knowledge Database (KDB) should be made mandatory.

Portable RF Sources. The FCC notes that, although Supplement C of EOT Bulletin 65 recommends maintaining separation of about one inch during the testing of consumer portable body-worn devices, many radiating devices may be used without any separation from the human body (e.g., Bluetooth headsets). The FCC states that its calculations suggest that some devices may not be compliant with its exposure limits without the use of a spacer to maintain a separation distance when body-worn. It asks for comments on whether it should consider zero spacing or actual contact with the body when testing some devices. 

As this summary discussion demonstrates, the NOI is extremely broad and is important to equipment manufacturers, spectrum licensees, and many classes of RF device users.  It is possible that, after developing an up-to-date record on appropriate exposure levels, the FCC may decide that the current exposure limits remain valid.  The FCC frequently states that the current values are cautious and in many cases, equipment operates below the permitted levels.

On the other hand, if the FCC concludes that changes in the exposure limits are necessary or appropriate, the FCC likely would issue a Notice of Proposed Rulemaking setting forth the basis for and the details of the changes it proposes.

We believe the FCC’s next action in this proceeding will be adoption of many of the changes it proposed in its FNPRM discussed in the second entry of this three-part series, including some form of the more detailed signage requirements. Those signage changes, if adopted as proposed, will impose tangible costs for many FCC licensees. These include a significant financial impact–the costs of determining where signage is required and obtaining and installing the new signage.   There is also the potential for significant fines from the FCC if licensees do not fully comply with the updated FCC rules.

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Radiofrequency exposure limits and mitigation requirements are an area of special expertise at Keller and Heckman LLP. With our wide-ranging and deep experience in the areas of telecommunications and health and safety, we stand ready to assist you with any questions or concerns about these regulatory requirements. Please feel free to contact the author at Fitch@khlaw.com.

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Part One of this series summarized the FCC’s long-pending proceeding and initial set of decisions on human exposure to radiofrequency (RF) fields. Generally, the more complicated and difficult decisions were deferred.  In light of Chairman Pai’s commitments to Congress, we expect the FCC to resolve at least some of the remaining issues in 2018. Let us now examine areas that are likely up next for decision.

In addition to the decisions in its First Report and Order (R&O), the FCC adopted a Further Notice of Proposed Rulemaking (FNPRM) and Notice of Inquiry (NOI). The FCC summarized the FNPRM as follows:

We are proposing to broadly revise and harmonize the criteria for determining whether single or multiple fixed, mobile, or portable RF sources are subject to routine evaluation for compliance with the RF exposure limits or are exempted from such evaluations.  Additionally, we propose clarifications of evaluation requirements for portable and medical implant devices.  We also propose to adopt specific new requirements for signs and barriers at fixed transmitter sites to ensure compliance with public and occupational exposure limits.  Further, we propose a clarification of the definition of transient exposure for non-workers exposed at levels up to occupational limits.

[We] propose establishing general exemptions from evaluation to determine compliance in place of existing service-specific “categorical exclusions.”  These proposed exemptions involve simple calculations to establish whether any further determination of compliance is necessary. .  .  .  The new, general exemptions would instead apply to all subparts authorizing RF sources. .  .  .  Given the trend toward opportunistic spectrum access to allow services to utilize multiple bands of frequencies with various power limits, inclusion of all services is necessary to better ensure compliance with our exposure limits.

Important proposed changes in the FNPRM include:

  1. Clarified definitions of “power” for consistency throughout the Rules.
  2. Changes to general exemption criteria based on power, distance, and frequencies involved for all services using fixed, mobile, and portable transmitters including implants; elimination of distinctions between different services.
  3. A blanket exemption for single transmitter operations with up to 1 milliwatt (mW) available maximum time-averaged power independent of frequency and service; minimum two-centimeter separation between multiple transmitters operation at up to 1 mW.
  4. For single transmitter operation above 1 mW, requiring routine environmental evaluation above a “sliding scale” of values for minimum distance as a function of wavelength and maximum power as a function of frequency and distance for five frequency ranges from 0.3-100,000 MHz. The FNPRM acknowledges that the formulas used for the sliding scale are based on worst-case calculations but states that they trigger further evaluation, not necessarily a finding of non-compliance with permitted exposure limits.
  5. A multi-step equation to sum the effect of multiple fixed transmissions in proximity to each other and determine whether further evaluation is required.
  6. Additional exemption criteria based primarily on Specific Absorption Rate (SAR) limits for single fixed, mobile, and portable transmitters in the frequency range 300 MHz-6 GHz at distances of 0.5-40 centimeters from a human body and formulas to determine whether additional evaluation is required for multiple portable and multiple portable and mobile transmitters.

The FNPRM also proposes changes regarding mitigation of exposure to RF, stating that “. . . mitigation matters involve post-evaluation procedures to ensure that our exposure limits are not exceeded. Such measures include labels, signs, barriers, occupational training, and enforcement.” Specifically, these proposals include:

  1. Clarification of transient exposure and how to apply exposure limits in controlled environments with respect to averaging time.
  2. Specific new training, access restriction, and signage requirements for fixed transmitter sites with a new four-category system based on an Institute of Electrical and Electronics Engineers (IEEE) standard.

There are four-categories of proposed signage requirements.  Signage would be required for Categories 2-4 but optional for Category 1.

Category 1 is exposure up to the General Population (GP) limit. No signage would be required. Green “INFORMATION” signs stating that a transmitting source of RF energy is nearby but compliant with FCC exposure limits would be optional.

Category 2 is exposure above the GP limit and up to the Occupational (O) limit. Signs and access control would be required surrounding the area in which the GP limit is exceeded. Blue “NOTICE” signs would have to be large enough to be visible at the separation distance required to comply with the GP limit. Training would be required for occupational personnel with access to the area. Use of personal RF monitors would be recommended but not required.

Category 3 is exposure above the O limit and up to 10 times the O limit. In addition to the Category 2 mitigation requirements, yellow “CAUTION” signs would be required surrounding the area in which the O limit is exceeded. Transient individuals would not be permitted in the Category 3 area. Use of personal protective gear would be recommended but not required.

Category 4 is exposure to more than 10 times the O limit. In addition to the Category 3 mitigation requirements, orange “WARNING” signs would be required where the O limit could be exceeded by a factor of 10 and red “DANGER” signs would be required wherever immediate and serious injury would occur. If power reduction would not sufficiently protect in the event of human presence considering additional use of optional personal protective equipment, lockout/tagout procedures would have to be followed.

The signage for Categories 2, 3, and 4 would require inclusion of the “radiating antenna” RF energy advisory symbol, an explanation of the RF source, behavior necessary to comply with exposure limits, and contact information for a timely response in addition to the color and key words listed for each category.

The FNPRM states that barriers may not be appropriate for all Category 2 environments and that the FCC continues to support suggested Engineering and Technology (OET) exceptions not to require barriers in remote areas with unlikely public access. The FNPRM also reiterates the principle that licensees cannot rely exclusively on natural barriers for protection unless specifically approved by the FCC on a case-by-case basis. The FCC Enforcement Bureau can require corrective action and impose fines or other sanctions for non-compliance.

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This is the first entry of three regarding the FCC’s ongoing proceeding addressing human exposure to radio-frequency (RF) fields.  Although the FCC proceeding has been pending for some time, Chairman Pai has informed Congress that further action is a Commission priority.  Thus, we expect the FCC to adopt one or more orders in this proceeding in 2018.

Exposure to RF emissions is a persistent concern for segments of the public and some public health and workplace safety advocates.  With ever-increasing consumer adoption of wireless communications including unlicensed operations and in-building Wi-Fi, the emergence of small cells, the Internet of Things (IoT), and 5G implementation, a review of existing rules, largely unchanged for over 20 years, is warranted to consider more current research and studies and to maintain the credibility of the FCC’s regulations regarding RF exposure limits.

The FCC regulations on RF exposure limits impact a wide range of business interests—companies which manufacture equipment, including wireless medical devices, businesses which use radio equipment in their delivery of other goods and services, public safety organizations of all types, and the general public– both as cell phone or other wireless device users and as beneficiaries of countless wireless applications.  Any change in the current RF emission limits could cause significant expense for these groups, especially if there are changes in the limits governing devices having high numbers of consumer adoption—smart phones, tablets and WiFi routers.

The long-pending FCC proceeding addresses a very broad range of issues.  The FCC re-states its confidence in the current exposure limits adopted in 1996.  However, it acknowledges that intervening research, the ubiquity of device adoption, advances in technology, and developments in international standards warrant a far more current and up-to-date record on these matters.

The current FCC limits differentiate between general public and occupational/controlled exposure limits. The latter apply to personnel with expertise and training regarding RF exposure safety.  For that reason, the exposure levels are higher than for the general public.  In today’s increasingly wireless world, a closer look at exposure levels for the general public appears warranted.

2013 First Report and Order

The current FCC proceeding actually dates back to March 2003, when the FCC issued a Notice of Proposed Rule Making (NPRM) to “provide more efficient, practical, and consistent application of compliance procedures” relating to rules “to ensure that the public is appropriately protected from any potential adverse effects from RF exposure . . . .”  In March 2013, the FCC adopted a First Report and Order (R&O), Further NPRM, and Notice of Inquiry (NOI).

In the First R&O, the FCC clarified power evaluation procedures and references to determine compliance with FCC limits and made changes to its regulations regarding labeling of RF devices.  Key changes include:

  1. Amending the rules to reference the underlying whole-body and partial-body exposure limits for SAR (Specific Absorption Rate) and to allow evaluation of SAR instead of power density or field strength for demonstrating compliance for fixed and mobile RF sources below 6 GHz.
  2. Maintaining use of maximum permissible exposure (MPE) as a basis for evaluation subject to certain conditions.
  3. Discontinuing Supplement C of OET Bulletin 65, which provided guidance on RF limits for portable and mobile devices because more updated information is available in OET’s “Knowledge Database” (KDB).
  4. Classifying the outer ear (“Pinna”) as an “extremity” and subject to exceptions for localized SAR limits for “extremities.”
  5. Adopting more specific labeling requirements for occupational/controlled exposure to mobile and portable devices. The occupational/controlled limits apply when individuals are “fully aware” and can “exercise control” over exposure.  For these situations there is a two-tiered approach: (1) written and/or verbal information must be provided to an individual that exposure is part of their employment, and (2) appropriate training regarding work practices to ensure awareness and control must be provided.
  6. For fixed sites with multiple transmitters, noting that failure to comply with the rules can result in penalties for all transmitter operators whose systems contribute significantly to the exposure.
  7. Declining to require a new evaluation for existing sites that were excluded from evaluation under its prior evaluation criteria.

The regulated community did not raise significant objections to these rules largely because there were few substantive changes from existing requirements.  The next phases of the proceeding may prove more challenging for device manufacturers and services providers.

Part Two will review the changes proposed by the FCC in its Further Notice of Proposed Rulemaking.

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This entry provides an overview of how enterprise customers shape the underlying business deals in telecommunications services agreements. In the previous entry, we discussed the primary objectives enterprise customers look to achieve in negotiating telecommunications services agreements.  In our initial entry in this series, we discussed the challenge counsel for enterprise customers face in confining telecommunications services agreements to the four corners of the customer contract.

Overview. There are two basic approaches for putting these deals together. The first is the default or “seat of the pants” approach in which the customer (telecom manager) limits discussions to the current provider(s), typically 3 to 6 months prior to expiration of the current contract and, based on informal discussions with consultants or other customers, asks for a “market-based” reduction in rates for a new three-year deal, maybe remembering to request pricing for replacement IP services. The second is to initiate a more structured process 9 to 14 months prior to the expiration of the current agreement by engaging an experienced consultant to develop a demand set for an RFP to issue to both incumbent and potential successor carriers and to advise on trends in carrier services and pricing, particularly the transition to IP-based services offerings. This entry focuses on the second approach.

Caveat: The incumbent often prevails even under a systematic, well-planned procurement. Transitioning to successor providers is resource-intensive and, for some period, entails the payment of services to the incumbent and the successor provider during the transition process. Hot cuts are not the rule for major enterprises, particularly at critical locations. Caveat to the Caveat. If there is insufficient time to initiate a transition to a successor provider (and avoid a substantial increase in service pricing per the rates in the incumbent’s price guide), both the incumbent provider and its competitive providers likely will not propose market-based pricing and terms and conditions. Thus, the RFP should be issued in a timely manner to allow for competitive, responsive bids and for a doable transition to the successor provider(s).

Value of Telecom Consultants. There are several reasons for engaging a competent consultant. First, there are no published lists of market-based rates; carrier guide rates are rarely accepted by customers. There is no equivalent of published commodity prices (crude oil, corn or pork bellies) or web sites such as Edmunds or TrueCar for enterprise telecommunications service pricing. Even the “best of the best” telecom managers have a limited knowledge base of current market pricing; unless they have changed jobs (frequently), these persons’ pricing knowledge is limited to the company’s last agreement or competitive pricing review of 12 to 18 months ago. Experienced consultants have more insights into current market pricing.

Consultants offer two other value-added services. The first is the development of the enterprise’s demand set for its RFP. Telecom service pricing is based largely on volume, customer locations, and service mix. Two aspects of developing a demand set are determining current usage of existing services at current and planned locations (or anticipating a reduction in locations) and selecting the services (type and capacity) that the customer is looking to acquire. This entails a review of bills and invoices, existing network design, current services, expected growth or contraction of the enterprise’s requirements, and desired services. The two latter considerations are driven by the customer with input from the procurement consultants.

The second value-added is the consultant’s RFP templates. In addition to setting out the demand set and desired services, the RFP elicits information on pricing, other business considerations and legal terms and conditions. The RFP is the starting point for negotiations. The consultant’s RFP should be reviewed within the enterprise by the telecom/IT department, procurement group, legal, and, perhaps, risk management. A company may wish to incorporate the consultant’s RFP into its standard RFP documents or modify the consultant’s RFP. A related consideration to be determined upfront is the extent to which the consultant is the principal contact and whether the consultant will take the lead in discussions with the carriers.

Revenue Commitments and Pricing Reviews. Several other economic considerations are central to the business deal in addition to rates (recurring charges, non-recurring charges, waivers and credits). The first is the minimum revenue commitment which the customer commits to spend either annually or over the term of the agreement. Exclusive purchase commitments are rare. The minimum commitment level is based on projected expenditures at the proposed rates. Currently, term commitments with annual commitments for each renewal period are more common. The minimum commitment is increasingly supplemented by “incentive credits.” The best pricing or highest discount under the agreement is achieved only when expenditures exceed some dollar amount above the minimum commitment level, qualifying for the incentive credits.

Agreements also include a so-called “business downturn/downsizing” provision. This clause is triggered when unexpected reductions in projected expenditures occur due to downturns, divestitures or downsizing in the customer’s business. This clause addresses the risk of paying a hefty sum that is the difference between the minimum commitment and the actual (reduced) level of expenditures. The typical quid pro quo is an increase in rates or an increase in the term of the agreement or both.

The second major economic consideration is the competitive pricing review. These reviews are typically conducted annually or every 18 months. Involvement with consultants are often essential for the customer to have some insight into current market trends. For enterprises with stable or growing expenditures and general satisfaction with the incumbent’s services, services agreements may be extended based on the price negotiations that follow the path of competitive pricing reviews.

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Many in the wireless industry are aware of the FCC rulemaking proceeding proposing regulatory changes to streamline the expansion of wireless infrastructure (WT Docket 17-79).  A basic premise of this proceeding is the tremendous potential of 5G wireless technology and the increased capacity needs and vast expansion of infrastructure supporting wireless networks that will be needed to deploy 5G. The proceeding focuses on and identifies potential obstacles to rapid deployment of wireless infrastructure at the local level.

For wireless carriers, small wireless cells are important because small cells support greater re-use of available spectrum and bring the wireless network closer to users and devices. Those attributes are very important to the developing Internet-of-Things (IOT).

Action by the FCC. In Nov. 2017, the FCC took one action in this docket. It excluded from required review under Section 206 of the National Historic Preservation Act (NHPA) replacement utility poles if these conditions are met:

(i)   The original structure

(A) Is a pole that can hold utility, communications, or related transmission lines;

(B) Was not originally erected for the sole or primary purpose of supporting antennas that operate pursuant to a spectrum license or authorization issued by the Commission; and

(C) Is not itself a historic property.

(ii)  The replacement pole—

(A) Is located no more than 10 feet away from the original pole, based on the distance between the centerpoint of the replacement pole and the centerpoint of the original pole; provided that construction of the replacement pole in place of the original pole entails no new ground disturbance (either laterally or in depth) outside previously disturbed areas, including disturbance associated with temporary support of utility, communications, or related transmission lines.  For purposes of this paragraph, “ground disturbance” means any activity that moves, compacts, alters, displaces, or penetrates the ground surface of previously undisturbed soils;

(B) Has a height that does not exceed the height of the original pole by more than 5 feet or 10 percent of the height of the original pole, whichever is greater; and

(C) Has an appearance consistent with the quality and appearance of the original pole. (FCC 17-153, footnotes omitted.)

What’s a “Small Cell.” There is no succinct, agreed definition of the term “small cells.” One FCC point of guidance is in the August 2016 First Amendment to the Nationwide Programmatic Agreement (NPA) for the Collocation of Wireless Antennas between the FCC, the National Conference of State Historic Preservation Officers, and the Advisory Council on Historic Preservation.

The amendment lists requirements for exemption from review under Section 106 of the NHPA for “collocation of small wireless antennas and associated equipment on buildings and non-tower structures that are outside of historic districts and are not historic properties.” The specified limits of the “small wireless antennas and associated equipment” are:

  1. Each individual antenna, excluding the associated equipment (as defined in the definition of Antenna in Stipulation l.A.), that is part of the collocation must fit within an enclosure (or if the antenna is exposed, within an imaginary enclosure, i.e., one that would be the correct size to contain the equipment) that is individually no more than three cubic feet in volume, and all antennas on the structure, including any pre-existing antennas on the structure, must in aggregate fit within enclosures (or if the antennas are exposed, within imaginary enclosures, i.e., ones that would be the correct size to contain the equipment) that total no more than six cubic feet in volume; and,
  2. All other wireless equipment associated with the structure, including preexisting enclosures and including equipment on the ground associated with antennas on the structure, but excluding cable runs for the connection of power and other services, may not cumulatively exceed:
    1.  28 cubic feet for collocations on all non-pole structures (including but not limited to buildings and water tanks) that can support fewer than 3 providers; or,
    2.  21 cubic feet for collocations on all pole structures (including but not limited to light poles, traffic signal poles, and utility poles) that can support fewer than 3 providers; or,
    3.  35 cubic feet for non-pole collocations that can support at least 3 providers; or,
    4.  28 cubic feet for pole collocations that can support at least 3 providers;

State Legislation. In addition to the FCC proceeding, there has been a flurry of actions at the state level that are changing the regulatory landscape for small cells. There has been a major campaign underway by the wireless industry which has achieved impressive results. A list of state legislative initiatives considered in recent years includes about 20 states, many of which have enacted new legislation limiting the authority of local governments regarding small cell installations on public right-of-way.

These proposed state law changes typically limit or eliminate the authority of local governments to determine where in local right-of-way small cell equipment can be installed; limit the time for review by local governments; and limit the application and/or right-of-way leasing charges that can be imposed. For example, Virginia enacted S.B. 1282 earlier this year. It provides that localities cannot require special exceptions or special use permits for small cell facilities installed on existing structures where providers already have permission to co-locate equipment. It imposes a 10-day limit to notify carriers of an incomplete application and a 60-day limit to approve or deny applications. It limits fees to $100 each for up to five small cell facilities on an application and $50 for additional facilities. It prohibits fees for carrier use of municipal rights-of-way, except for zoning, subdivision, site plan, and comprehensive plan fees. It mandates that approval for a permit shall not be unreasonably conditioned, withheld, or delayed.

The Virginia law uses these definitions:

“Micro-wireless facility” means a small cell facility that is not larger in dimension than 24 inches in length, 15 inches in width, and 12 inches in height and that has an exterior antenna, if any, not longer than 11 inches.

“Small cell facility” means a wireless facility that meets both of the following qualifications: (i) each antenna is located inside an enclosure of no more than six cubic feet in volume, or, in the case of an antenna that has exposed elements, the antenna and all of its exposed elements could fit within an imaginary enclosure of no more than six cubic feet and (ii) all other wireless equipment associated with the facility has a cumulative volume of no more than 28 cubic feet, or such higher limit as is established by the Federal Communications Commission. The following types of associated equipment are not included in the calculation of equipment volume: electric meter, concealment, telecommunications demarcation boxes, back-up power systems, grounding equipment, power transfer switches, cut-off switches, and vertical cable runs for the connection of power and other services.

State legislation along these same lines has been adopted in many other states in the last year. Of course, each state’s law varies and must be read carefully to determine its changes.

In contrast, Senate Bill 649 was passed this year by the California legislature but was ultimately vetoed by the Governor. S.B. 649 streamlined the local approval process for small cell sites and limited fees for small cells installed on municipal infrastructure to $250/year with a defined cost of living increase formula. The bill defined small cells as follows:

(3) (A) “Small cell” means a wireless telecommunications facility, as defined in paragraph (2) of subdivision (d) of Section 65850.6, or a wireless facility that uses licensed or unlicensed spectrum and that meets the following qualifications:

(i) The small cell antennas on the structure, excluding the associated equipment, total no more than six cubic feet in volume, whether an array or separate.

(ii) Any individual piece of associated equipment on pole structures does not exceed nine cubic feet.

(iii) The cumulative total of associated equipment on pole structures does not exceed 21 cubic feet.

(iv) The cumulative total of any ground-mounted equipment along with the associated equipment on any pole or nonpole structure does not exceed 35 cubic feet.

(v) The following types of associated ancillary equipment are not included in the calculation of equipment volume:

(I) Electric meters and any required pedestal.

(II) Concealment elements.

(III) Any telecommunications demarcation box.

(IV) Grounding equipment.

(V) Power transfer switch.

(VI) Cutoff switch.

(VII) Vertical cable runs for the connection of power and other services.

(VIII) Equipment concealed within an existing building or structure.

In his veto message, the Governor stated:

This bill establishes a uniform permitting process for small cell wireless equipment and fixes the rates local governments may charge for the placement of that equipment on city or county owned property, such as streetlights and traffic signal poles. There is something of real value in having a process that results in extending this innovative technology rapidly and efficiently. Nevertheless, I believe that the interest which localities have in managing rights of way requires a more balanced solution that the one achieved in this bill.

That suggests the possibility of another effort to address these issues during the next legislative session in California.

Federal Legislation. There is also proposed Federal legislation regarding the approval process for small cells. On October 19, Senators Wicker (R-MI) and Cortez Masto (D-NV) introduced S. 1988, the Streamlining Permitting to Enable Efficient Deployment of Broadband Infrastructure Act of 2017 or the “SPEED Act”.

This legislation would exempt small wireless facilities from environmental and historic reviews under the National Environmental Policy Act (NEPA) if they meet these conditions: (1) They are being deployed in public right of way and are not higher than an existing structure in the public right of way; or (2) They are serving as a replacement for an existing small cell and are substantially similar (as defined by the FCC) to the small cell being replaced. It would also exempt wireless towers from NEPA review if located in public right of way and the antenna tower or support pole is not more that the higher of 50 feet tall or 10 feet higher that any existing structure in the public right of way and does not have guy wires. The SPEED Act uses FCC size and other applicable requirements as its definition of small wireless facilities.

Prospects for enactment are not clear at this time.

If you would like additional information regarding these actions, please contact me or any other attorney in the Telecommunications Practice Group at Keller and Heckman LLP.

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Trends in wireline and mobile services strongly suggest a refresh to the FCC Forms 499-A/Q is in order. For purposes of brevity, this entry focuses on the Form 499-A. While changes to the forms do not address the challenge of a declining USF revenue base and an accelerating contribution factor or answer long pending USAC requests for guidance to the Wireline Competition Bureau (“the Bureau”), a shift to fewer revenue buckets (categories) aligned with the major services currently provided to customers could reduce the time for services providers to prepare Forms 499-A and for USAC staff to review forms or conduct audits. Other incremental steps are also suggested.

Consumers increasingly purchase service in bundles:

  • Wireless bundles: Voice, text and data (Internet access service); occasionally, voice-only
  • Wireline bundles: Voice, data and video: data and video; or increasingly data-only

Voice services are assessable services. High speed Internet access and multi-channel video programming services are not. The FCC has declined to classify text messaging as telecommunications, a telecommunications service or an information service. Interconnected VoIP is rapidly displacing circuit switched wireline voice services. Switched access service revenues are approaching inconsequential status.

The all-distance bundles for wireline voice services may encompass unlimited domestic calls and unlimited or an allotment of international minutes to select countries with the overage billed on a per minute basis, as service to other countries, tracking closely mobile voice service pricing schemes. International calling card revenues remain cognizable. Payphone services revenues are not.. The same is true for Line 405 revenues (subscriber line charge and certain PICC charges). The latter can be added to the voice services bucket.

The utility of separate USF reporting categories for wireline voice services, depending on how they are priced, is not apparent. The same is true for mobile voice service revenues; distinguishing between prepaid and postpaid voice revenues is irrelevant for determining USF assessable revenues. The relevant USF considerations are (1) apportioning revenues between assessable voice services from the revenues from bundled non-assessable services and products and (2) determining the proper jurisdiction.

The revenues for wireline voice services (increasingly interconnected VoIP) provided to small businesses, many educational institutions, libraries and not-for-profits, and many local governments (collectively “SMB customers”) are principally wireline voice (intrastate, interstate, and international, both outbound and inbound (toll free)), and high speed Internet access service. These services are often priced separately, posing less of a revenue apportionment challenge.

Enterprise customers often obtain a broader mix of services that include

  • Voice services (local, outbound and inbound (toll free), increasingly interconnected VoIP), with multiple pricing options
  • Special access services
  • Private line services
  • Other non-Internet data services, such as MPLS-based services
  • High speed Internet access services

Enterprise customers, including the Federal government and many state governments, will have significant international revenues.

Enterprise voice services revenues would be added to a services provider’s voice services revenue category; for enterprise voice services, the principal USF consideration is assignment to the correct jurisdiction (intrastate, interstate, international or foreign). The same is true for special access and private line services. Special access services are sold to wireless carriers and, principally, to wireline services providers that resell the services to end users. Special access services should be reported separately from private line service, consistent with industry practice of offering and charging for these services separately.

Private line service should be reported on one line as the distinction between “local’ and “toll” private line services is both confusing and irrelevant. The critical issue for private line and special access services is determining the correct jurisdiction. For physically intrastate private lines and (almost all) special access circuits (having endpoint within a single state), services providers must consider the 10% de minimis rule to determine the jurisdiction of these services. The Bureau addressed several longstanding requests for review of USAC determinations involving the 10% de minimis rule in its 30 March 2017 Memorandum and Opinion and Order, but the decision is subject to applications for review.

An addressable issue raised in the 2012 USF Contribution Reform Further Notice of Proposed Rulemaking is the disparity between the “safe harbors” for interstate/international mobile service (37.1%) and interstate/international VoIP service (64.9%) on the one hand, and the noticeably lower reported values provided by the services providers (based on actual traffic or traffic studies) for these services on the other. A review of how the Commission set the mobile service safe harbor highlights the need for a refresh.

The Bureau could readily take the pragmatic step and conclude the process (or refresh the record) to align the safe harbors with services providers’ reported data either actual or based on traffic studies. This could reduce administrative burdens for services providers and for limited USAC staff resources.

Despite the trend in USF-support being extended increasingly to non-assessable high speed Internet access service, the instructions for Line 308 could be expanded to identify (i) all USF-supported programs, and (ii) the portions of providers’ revenues from supported services per program that should be reported as end-user revenues. This is preferable to reliance on abbreviated answers in USAC FAQs, particularly as more services providers are and will be receiving USF funds going forward as compared to 2015 and previous years.

Finally, a “Line 418.5” could be added to identify the revenues for high speed Internet access service provided within the United States. It merits reporting as it is such a large component of many services providers’ aggregate revenues.

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This entry discusses the primary objectives that enterprise customers look to achieve in negotiating telecommunications services agreements. In a recent entry, we discussed the challenge counsel for enterprise customers face in confining telecommunications services agreements to the four corners of the customer contract. In a future entry, we will look at how the underlying business deal is put together.

Invariably, the customer’s objectives include the following:

  1. Improved pricing
  2. Desired, reliable services (core transport services and non-core services)
  3. Sufficient capacity for services at customer locations
  4. Timely provisioning
  5. Meaningful service level agreements (SLAs)
  6. Customer support

These objectives are not static; rather, the intention is that these objectives be met for the duration of an agreement that typically includes an initial term for 3 years, at least a single, one-year renewal option for the customer and a transition period.

Improved Pricing. The constant underlying interest is that the customer wants to finalize the agreement “yesterday” because in almost all cases the new agreement provides improved pricing. This is often coupled with the deployment of new services and, sometimes, the transition to a successor carrier’s services. Carriers leverage this customer interest in negotiations, not offering the optimum terms; obligating the customer to request or forego requests for better terms and conditions, subject to commitments made in its response to the customer’s RFP.

Customers often request a competitive pricing review clause that calls for one or more reviews of current rates. The purpose of this clause is to “refresh” the pricing to secure “market-based” rates. Because there is no public repository of current pricing for enterprise services agreements, customers often look to telecom consultants to assist in pricing reviews

Services. There are five core services:

  • Voice services, either TDM, VoIP or both as carriers are transitioning their networks from TDM to VoIP (Call center services are often included as a subset of voice services)
  • Special access service
  • An MPLS-based data service
  • Private line service
  • High speed Internet access service

These services are provided in the United States and to varying degrees within its territories and possessions. Depending on customer requirements, voice services, private line services and MPLS-based data services connect U.S. locations to and from foreign destinations and between foreign points. Special access services are acquired in other countries, but pricing for these services are not always included in the enterprise services agreement.

Customers often request a technology upgrade clause, the purpose of which is to allow a customer to secure a more advanced service (a problematic definition) in lieu of an existing service provided under its current agreement. The advanced service may be offered by the current provider or another services provider. This clause is invoked far less than competitive pricing review clauses.

The primary non-core services include network management (router management), firewall and encryption (security), data center (collocation) and content delivery services.

Sufficient Capacity. In both fast and slow growing organizations, the demand for services is increasing; it is not a matter of whether, but by how much. Services agreements often include pricing schedules for higher capacity MPLS-based service ports, special access and private line services.

Provisioning. Whether IP-based or TDM wireline services are being provided, physical circuits must be extended from a services provider’s network (its closest point of presence (POP)) to customer locations. A local services provider—sometimes an affiliate of the customer’s carrier—provides the special access circuits connecting customer locations to its services provider’s network. Services agreements include specific procedures for ordering, testing and accepting new circuit/service installations and discontinuing services.

Provisioning is a resource-intensive process for carriers and customers. It is one of, if not the most significant, hurdle for switching from the incumbent provider to a successor carrier.

Service Level Agreements (SLAs). These are carrier commitments that a given service will meet performance metrics, such as jitter, latency, availability, and mean time to repair (MTTR).  Some SLAs apply to service between carrier endpoints; others apply to service between customer locations. SLAs are also offered for provisioning. SLAs are not always published in the carrier’s Service Guide; if not, the SLAs will be attached to the agreement. One criticism of carrier SLAs is that chronic or recurring issues are either ignored or inadequately addressed. Some customers look to negotiate “custom” SLAs that more fully reflect the adverse impact of significant service issues on the customer’s business.

Many SLAs provide credits for non-compliance that extend beyond a minimum period. As a rule, customers must report the trouble and submit a separate request for a credit.

Customer Support. Carrier processes for ordering, provisioning and testing circuits and services, and acting upon service termination requests are well-established and work most of the time. Recurring problems in either service ordering, provisioning, testing or significant SLA violations can arise and, from the customer’s perspective, cannot be addressed soon enough. In addition, there is a likelihood of hiccups as carriers transition from TDM to IP-based services, as this can entail service/circuit transitions at every customer location.

The customer is not necessarily looking for credits, but assurances that these issues are addressed as they arise and procedures implemented to minimize their recurrence. These concerns are often addressed by adding provisions to the services agreement calling for scheduled discussions pertaining to one or several of these areas between knowledgeable carrier staff and the customer.

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After an extended deliberative process and pursuant to issuance of a Request for Proposals (“RFP”), the First Responder Network Authority, commonly known as FirstNet, selected AT&T as its partner to build, operate and maintain the Nationwide Public Safety Broadband Network (“NPSBN”). The actual terms of the agreement between FirstNet and AT&T remain unavailable to the public for “proprietary” reasons. However, what has been revealed in public statements and in trade press reports may raise questions about whether the AT&T proposal accepted by FirstNet tracks the vision Congress had when it created FirstNet.

Spectrum Licensed to FirstNet Apparently Being Held in Reserve

As mandated by Congress in the Middle Class Tax Relief and Job Creation Act of 2012, (“Act”) the FCC licensed the 758-769/788-799 MHz band to FirstNet on a nationwide basis. This legislation was the culmination of a persistent effort by the nation’s leading public safety organizations to secure a 20 MHz block of “beachfront” 700 MHz spectrum for broadband use by first responders in urban and rural areas across the country. As recognized by the FCC, the “Act charges FirstNet with responsibility for establishing and overseeing a ‘nationwide interoperable public safety broadband network’ operated in this spectrum.” Emphasis on this spectrum.

The AT&T proposal adopted by FirstNet appears to essentially make the AT&T network the heart of the NPSBN with the FirstNet 700 MHz spectrum playing, at best, a supporting role in parts of the country. FirstNet has widely promoted that the entire AT&T network will be available immediately to first responders, with priority and preemption available on the LTE portion of the network. FirstNet’s beachfront spectrum will be utilized as part of the NPSBN where deemed necessary by AT&T. In testimony before Congress on July 20, 2017 (‘Congressional Hearing”), AT&T acknowledged that it will use the 700 MHz FirstNet spectrum where added “capacity” is needed by the AT&T network.

Exactly how much of FirstNet’s licensed spectrum is intended to be incorporated into the NPSBN by AT&T under its contract with FirstNet is a carefully guarded secret. In its Congressional testimony, AT&T represented that it will be “significant.” However, when pressed for a percentage on how much of the geography of the United States will be covered by the build-out of licensed FirstNet spectrum, AT&T declined to provide a specific answer saying this information is “proprietary” and cannot be disclosed – even to Congress.

Rural America

The Act also speaks in terms of “buildout” and “construction” to meet rural milestones. However, parts of rural America will apparently not see NPSBN base stations deployed– on any spectrum. The AT&T plan adopted by FirstNet apparently will rely on deployables – such as cells-on-wheels or COWs – in those areas of rural America in which neither the AT&T network nor the networks of potential roaming partners extend. In some cases, these deployables may take many hours to reach the site of an incident. How this approach meets the intent of Congress in mandating rural milestones for build-out of the NPSBN is an open question.

“Public Safety Grade”

FirstNet and AT&T have not articulated the meaning of a “public safety grade” facility. At the Congressional Hearing, both AT&T and FirstNet struggled in articulating the meaning of this concept, essentially saying that there is no one definition. This lack of clarity is unfortunate since a fundamental purpose of the legislation creating FirstNet was to make sure that public safety would not have to rely on a commercial network that is not sufficiently hardened. Groups such as NPSTC have developed detailed descriptions of what the first responder community considers “public safety grade.”  One only need look at the devastating results of Hurricane Sandy, which knocked out service in 25 percent of the cell towers in its path, to understand the importance of this issue to public safety.

Priority and Preemption

The concepts of priority – first responders go to the head of the line – and preemption – first responders knock other users off the network – under FirstNet’s plan also raise concerns. Following acceptance of its proposal by FirstNet, AT&T raised the issue of whether the FCC’s “net neutrality” policy, which is aimed, in part, at minimizing prioritization of Internet-based traffic could complicate its ability to provide priority and preemption to public safety users on the AT&T network. Congress or the FCC may eventually change the 2015 Open Internet Order, consistent with the proposal recently released by the FCC. Nevertheless, it is striking that AT&T is concerned with the potential impact of net neutrality on first responder priorities under the plan adopted by FirstNet.

As originally intended under the Act, first responders on FirstNet’s 700 MHz spectrum would be entitled to preemption, with the potential that non-public safety or less essential users could lose access to the network during emergency situations. The statute is based on the premise that these “secondary” users would be well-aware of their lower status on the FirstNet spectrum and would be willing to accept this condition in exchange for the right to access the NPSBN.

The proposal to deploy on AT&T’s network flips this concept on its head.  Under the plan adopted by FirstNet, the users that are subject to preemption during an emergency could potentially be members of the public who are depending on AT&T’s network. It is not entirely clear from public statements if AT&T customers will lose access to the entire network and if so, under what circumstances. At a minimum, this is an issue that deserves further clarification.

The spectrum licensed to FirstNet is intended under the Act to be the centerpiece of a hardened NPSBN that serves public safety agencies throughout America. It can be argued that the plan adopted by FirstNet is, in effect, little more than a rebranding of the AT&T network as the NPSBN, which raises substantial legal and policy questions.

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A guiding principle for attorneys and their clients when negotiating telecommunications services agreements is the four corners defense.  No, not the end-of-game defensive strategy devised by the legendary Dean Smith for his UNC basketball team, but the straightforward strategy of keeping the terms and conditions of telecommunications services agreements within the four corners of an agreement.

Due to deregulation and migration to IP-based services, telecommunications tariffs have largely disappeared.  The process started over twenty years ago.  In the United States, local exchange TDM voice services, DS-1 and DS-3 special access services and some intrastate interexchange voice and private line services remain tariffed.  Consistent with FCC decisions dating back to the 1990s, the major wireline and wireless carriers and the MSOs have replaced tariffs for telecommunications services with a combination of end-user (consumer, small business and enterprise) agreements and online service guides.  Broadband services have always been offered through some combination of end-user agreements and online terms and conditions.

These service guides were initially required by the agency to disclose standard prices for de-tariffed services and to be made available to the public at the carriers’ principal offices or online.  The scope of the terms and conditions in online services guides has expanded substantially and, in many cases, replicates the one-sidedness of tariffs.  For enterprise customers, service guides currently offer the services providers’ service descriptions, service level agreements (SLAs) (sometimes), standard rates and charges, and policies such as the Authorized User Policy (AUP) for Internet access service.  Several services providers also post a comprehensive set of general legal terms and conditions and related definitions.

Several online service guides are almost impossible to search.  URLs in customer agreements related to potentially relevant online web pages often prove to be dead-ends.  However unfriendly the online design and integration of service guides, the overarching concern is that services providers reserve the right to modify unilaterally all aspects of their service guides including service descriptions, SLAs, pricing schedules, privacy and authorized user policies (AUPs) and, as applicable, the provider’s online general terms and conditions.  Some services providers insist on an indemnity from customers for violations of the provider’s AUP for which the provider reserves the right to modify at any time.  In some instances, the general terms and conditions in the services guide not only conflict with the terms and conditions in the executed agreement, but may impose additional or supplemental customer obligations and conditions that are not readily trumped (excuse the pun) by a standard precedence clause in the executed agreement.

Some services providers push the envelope even further, asserting that the customer’s sole remedy for services providers’ unilateral changes to the service guides that are “material and adverse” to the customer is the customer’s right to discontinue the affected service on sixty (60) days-notice.  Apart from excluding the customer’s right to damages, replacement services to multiple customer locations (sometimes a hundred or more sites) cannot be sourced, provisioned, and tested and the customer’s traffic cannot be reliably migrated to replacement services in sixty (60) days.

This brings us back to the four corners defense.  The agreement executed by the customer and the services provider should provide for fixed rates, as opposed to percentage discounts of the rates in the online services agreements; services providers invariably reserve the right to change the rack rates in their service guides with virtually no notice.  The written agreement should also exclude “shadow” general terms and conditions in the service guide as opposed to relying on a precedence clause.  The minimum response to the services providers’ provision authorizing changes to the service guide that are “material and adverse” to the customer is to secure a six-to-twelve-month transition period to migrate to replacement services, not sixty (60) days.

There is one caveat on changes in wireline services. The major telecommunications carriers are now transitioning their networks from TDM technology to IP-based services.  (The MSOs’ networks are largely IP-based.)  The FCC is accommodating the carriers’ efforts to minimize regulatory delays and burdens on ILECs in implementing this transition and in replacing copper loops with fiber or fixed wireless technologies.  The core networks of the major services providers are well along in this transition, but the transition in special access services varies considerably in terms of location and the ILEC provider.

Enterprise customers should press their wireline services providers on (i) the status and projections for completing their IP-transitions, and (ii) the transition plans for the ILECs from which the services provider will be acquiring special access services.

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FirstNet recently selected AT&T as its partner to build, operate and maintain the Nationwide Public Safety Broadband Network (“NPSBN”).  With AT&T leading the charge, network development appears to be on a fast track. In early June, the initial AT&T/FirstNet Radio Access Network (“RAN”) or coverage plans were made available electronically to all 50 states, the District of Columbia and territories of the United States (referred to as the “states” for purposes of this article). After a brief period for review, comment and consultations, the plans will be finalized and the Governor of each state must decide whether to accept the FirstNet plan or to seek an alternative coverage model through the state’s own Request For Proposal (“RFP”) process.

In evaluating its options, the goal of every state should be to obtain the best possible network coverage for its First Responders. The safety of First Responders and the public must be the primary concern in evaluating the AT&T/FirstNet plan. In order to conduct a reasonably thorough examination, the Governors and their teams must have access to the necessary financial, technical and legal information regarding AT&T’s commitments to deliver the NPSBN.

However, the states currently face a major obstacle in conducting their analysis. They do not have access to the underlying contract between AT&T and FirstNet. There have been numerous trade press reports and FirstNet/AT&T presentations about what the AT&T proposed roll-out will entail (e.g. access to the entire AT&T network, public safety usage targets, priority and preemption). However, no one from a state government is privy to the specific terms of the FirstNet/AT&T agreement. As with most agreements the “devil is in the details,” but the states cannot access the details.

There are countless issues involved in the review of state plans that turn on the conditions of the underlying FirstNet/AT&T contract. For example, how much of the statutory requirement for rural coverage can be satisfied through “deployables” as opposed to permanent hardened infrastructure under the terms of the contract? What is the specific long-term commitment to support discounted pricing for public safety use? Is there a mechanism in place to resolve any disputes that may arise between FirstNet and AT&T.

A fundamental question is whether there is an option for AT&T to “opt-out” of the contract with FirstNet if it fails to obtain a certain number of states “opting-in” or for any other reason. Another basic issue pertains to the penalties that AT&T may have to pay if it fails to meet certain levels of public safety use or “adoption” on the network. Without firsthand knowledge of the AT&T/FirstNet agreement, there is no way of knowing with certainty if there are caveats or conditions that could limit such a requirement?  What happens to the spectrum if there is zero public safety adoption in a given area or insufficient adoption on a nationwide basis? These are significant questions to which states are entitled to an answer.

For AT&T and FirstNet to simply address these and other critical questions an on ad hoc basis is not a prudent approach. The only way for a full evaluation of whether the needs and objectives of public safety are being met is for FirstNet and AT&T to disclose the underlying contract to the states so that they can examine the specific terms of the agreement.

As things now stand, a Governor is being asked to accept a vendor to build and operate the public safety network within his or her state – impacting the lives of First Responders and the public – without firsthand knowledge of the terms under which AT&T will provide the service. FirstNet and AT&T should disclose the terms of their contract pursuant to an appropriately drafted non-disclosure agreement so the Governors and their teams will have a complete picture in reviewing the FirstNet/AT&T coverage plans.