The Following Items Were Reported at the December AICC Meeting

Wireline Report December 6, 2011

The following items were reported at the December AICC meeting.

Open Network Architecture

As previously reported, AICC filed reply comments on the FCC's proposal to eliminate the reporting requirements applicable to the Bell Operating Companies (BOCs) concerning their comparably efficient interconnection (CEI) and open network architecture (ONA) obligations. AICC raised the concern that the BOCs were not limiting their efforts to eliminating the reporting requirements but also were attempting to have the underlying narrowband CEI/ONA obligations eliminated as well.

Pending resolution of its proceeding, the FCC has waived the reporting requirements on its own motion. Accordingly, the BOCs are not required to prepare and file quarterly, semi-annual and annual reports to demonstrate their compliance with these requirements, pending further Commission action on this matter. In its waiver order, the FCC states that its waiver is not a prejudgment of the issue. The FCC also notes, however, that the record suggests that the reports are of limited value and do not justify the expense and burden of preparing them.

Net Neutrality (Open Internet Proceeding)

The FCC's net neutrality or open internet rules became effective on November 20, 2011.

As of November 20, 2011, all fixed and mobile broadband service providers are required to disclose their network management practices, performance, and commercial terms of service in a manner sufficient for consumers to make informed choices regarding use of such services and for content, application, service, and device providers to develop, market, and maintain Internet offerings. Disclosures include information on network practices, including congestion management, application-specific behavior, device attachment rules and security measures; performance characteristics, including a general description of system performance and the effects of specialized services on available capacity; and commercial terms, including pricing, privacy policies and redress options. Broadband service providers also should disclose information on the type of facilities used to provide service and the actual upload and download speed of the service.

In comments and reply comments filed in this proceeding, AICC raised the concern that broadband providers may have the ability and incentive to engage in anti-competitive conduct with respect to specialized services. As a result of the FCC's rules, broadband providers are required to identify the specialized services they offer and indicate whether those services impact the performance characteristics of its internet access service. At this time, however, the FCC has identified only facilities-based VoIP and IP video as specialized services.

This information should be available on the website of all broadband service providers.

In addition to the disclosure requirements, fixed broadband providers cannot block lawful content, applications, services, or non-harmful devices, subject to reasonable network management; mobile broadband providers cannot block lawful websites, or block applications that compete with their voice or video telephony services, subject to reasonable network management; and fixed broadband providers cannot unreasonably discriminate in transmitting lawful network traffic.

Broadband Outage Reporting Requirements

The FCC has instituted a proceeding seeking to impose outage reporting requirements on interconnected VoIP providers and broadband Internet access service providers,defined as "providers of any mass-market retail service by wire or radio that is able to support interconnected VoIP service." Outage reporting requirements already apply to wireline and wireless communications service providers.

Under the proposed rules, interconnected VoIP providers and broadband Internet access service providers must report an outageof at least 30 minutes duration that "potentially affects at least 900,000 user minutes and results in (i) complete loss of service; or (ii) an average packet loss of 1 percent or greater, or (iii) average round-trip latency of 100 ms or greater, or (iv) average jitter of 4 ms or greater, with all packet loss, latency, and jitter measurements taken in each of at least 6 consecutive 5 minute intervals from source to destination host."

Broadband Universal Service and Intercarrier Compensation Reform

In November, the FCC released an order and further notice of proposed rulemaking (FNPRM) radically changing the federal universal service and intercarrier compensation regimes that apply to carriers to promote broadband deployment.

With respect to federal universal service, the FCC requires all carriers receiving federal universal service support for voice service to also provide broadband service that meets the following performance characteristics:

1. actual downstream speed of 4 Mbps and upstream speed of 1 Mbps (for areas served by price cap carriers, this will increase to 6Mbps/1.5 mbps to some number of supported locations in the future)

2. latency sufficient for real time applications, including VoIP and

3. capacity reasonably comparable to that available in urban areas (the FCC states that a 250 GB monthly data limit for fixed broadband would likely be adequate at this time).

The FCC has imposed a "budget" on federal high cost support in the amount of $4.5 billion annually. This is the current level of federal high cost universal service support. Therefore, the part of the universal service fee that appears on communications bills to support high cost networks should not increase.

The FCC adopted a new Mobility Fund to provide support for wireless in unserved areas. The Mobility Fund will consist of non-recurring support and recurring support. For the non-recurring support, mobile service providers will be required to provide supported services over a 3G or better network that has achieved data rates of 200 kbps downstream and 50 kbps upstream to handheld mobile devices. For mobile service provides that commit to provide supported services over a 4G network, mobile transmissions to and from the network must meet or exceed an outdoor minimum of 768 kbps downstream and 200 kbps upstream to handheld mobile devices. In order to ensure that support recipients offer service that enables the use of real-time applications such as VoIP, round trip latencies for communications over the network must be low enough for this purpose. No minimum capacity requirement was adopted at this time. However, the FCC emphasized that any usage limits imposed by a provider on its mobile broadband services supported by the Mobility Fund must be reasonably comparable to any usage limits for comparable mobile broadband offerings in urban areas.

In the Order, the FCC adopts bill and keep as the ultimate, uniform, national methodology for all telecommunications traffic exchanged with a LEC. This will replace, over time, the current system of interstate and intrastate access charges for the exchange of toll traffic and reciprocal compensation for the exchange of local traffic. Once all charges are transitioned to bill and keep, LECs will recover all costs of their networks from end user customers and universal service.

In order to offset the decline in revenues that will be caused by the transition to bill and keep for terminating access, the FCC will allow carriers to recover a portion of their lost revenues through charges on residential and business customers.

IP-to-IP Interconnection

The FCC has released a Further Notice of Proposed Rulemaking seeking comment on IP-to-IP interconnection. The FCC seeks comment on whether it should leave IP-to-IP interconnection to unregulated commercial agreements or whether Commission rules are required to encourage or require IP-to-IP interconnection. In any event, the FCC states that all carriers are expected to negotiate in good faith in response to requests for IP-to-IP interconnection for the exchange of voice traffic.

Comments on this aspect of the FCC’s FNPRM are due on February 24, 2012 and reply comments are due on March 30, 2012.

Telecommunications Service Priority

A test case customer was submitted and was accepted by the FCC and Department of Homeland Security (DHS) as qualifying for TSP designation under the "National security posture and US population attack warning"priority level. According to the FCC's rules, this subcategory covers telecommunications services "essential to maintaining an optimum defense, diplomatic, or continuity-of-government postures before, during, and after crises situations. DHS has provided an application process that should be used to submit an application to DHS to obtain TSP in connection with service provided to customers who qualify under the "National security posture and US population attack warning"priority level.