September 2020 News Update
USDA Announces $1.7 Million ReConnect Program Broadband Award In South Dakota And Wyoming
September 29, 2020 – The U.S. Department of Agriculture has announced a $1.7 million ReConnect Program broadband grant has been awarded to Golden West Telecommunications Cooperative, Inc. in rural southwestern South Dakota and eastern Wyoming. Golden West will receive a $1.7 million grant to deploy a fiber-to-the-premises network that will connect 218 people, five businesses, 65 farms, and one essential community facility to high-speed broadband service in Fall River and Custer counties in South Dakota, and Niobrara and Weston counties in Wyoming. The funded service area includes 100 households and one essential community facility spread over 404.74 square miles. The grant is the 13th award made under the second round of the ReConnect Program. It brings the total funding made in the second round to $129,781,192.
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Mississippi Public Service Commission Wants FCC To Audit AT&T’s Use Of Connect America Fund Support
September 29, 2020 – The Mississippi Public Service Commission has sent a letter to the Federal Communications Commission (FCC) which requests the FCC conduct “a full compliance audit of AT&T Mississippi regarding information submitted to federal entities surrounding the telecom giant’s claims of providing internet service to homes in Mississippi through the company’s use of federal dollars in the FCC’s Connect America Fund.” On September 10, 2020, the Mississippi PSC sent an investigative subpoena for records from AT&T regarding the AT&T’s acceptance of $283 million in CAF support to expand broadband service to 133,000 locations in Mississippi. The Mississippi PSC claims it has “clear and convincing evidence” that AT&T submitted false broadband deployment data to the Universal Service Administrative Company. The PSC further claims AT&T Mississippi has “actual knowledge of these invalid submissions regarding their provision of service.”
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DOJ Sends Congress Proposed Section 230 Legislation
September 23, 2020 – The U.S. Department of Justice has sent Congress draft legislation that proposes changes to Section 230 of the Communications Decency Act, the law that provides certain immunity for online platforms. The proposed legislation “implements reforms that the Department of Justice deemed necessary in its June Recommendations and follows a yearlong review of the outdated statute.” President Trump, in May 2020, issued an Executive Order titled “Preventing Online Censorship,” which calls for the immunity provided to online platforms by Section 230 to be scaled back. The DOJ’s draft legislation focuses on two areas of reform:
(1) Promoting Transparency and Open Discourse – The current interpretations of Section 230 have enabled online platforms to hide behind the immunity to censor lawful speech in bad faith and is inconsistent with their own terms of service. To remedy this, the department’s legislative proposal revises and clarifies the existing language of Section 230 and replaces vague terms that may be used to shield arbitrary content moderation decisions with more concrete language that gives greater guidance to platforms, users, and courts. The legislative proposal also adds language to the definition of “information content provider” to clarify when platforms should be responsible for speech that they affirmatively and substantively contribute to or modify.
(2) Addressing Illicit Activity Online – Section 230 immunity is meant to incentivize and protect online Good Samaritans. Platforms that purposely solicit and facilitate harmful criminal activity – in effect, online Bad Samaritans – should not receive the benefit of this immunity. Nor should a platform receive blanket immunity for continuing to host known criminal content on its services, despite repeated pleas from victims to take action. The department also proposes to more clearly carve out federal civil enforcement actions from Section 230. Although federal criminal prosecutions have always been outside the scope of Section 230 immunity, online crime is a serious and growing problem, and there is no justification for blocking the federal government from civil enforcement on behalf of American citizens. Finally, the department proposes carving out certain categories of civil claims that are far outside Section 230’s core objective, including offenses involving child sexual abuse, terrorism, and cyberstalking.
A copy of the DOJ’s cover letter to Congress explaining the need for Section 230 reform and how the Department proposes to reform it is available here. A redline copy of Section 230 with the DOJ’s proposed changes is available here. An accompanying section-by-section analysis of each proposed change to the law is available here.
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AT&T Elects Seventh Year Of CAF Phase II Funding
September 23, 2020 – AT&T Services, Inc. has elected to receive the seventh year of model-based support for its price cap carrier subsidiaries in all 18 states where AT&T is participating in the FCC’s Connect America Fund (CAF) Phase II program. The states and amounts which AT&T subsidiaries are authorized to receive CAF II support are as follows: Alabama $23,161,780 – Louisiana $27,907,591 – Arkansas $21,350,835 – Michigan $29,750,677 – California $60,240,434 – Mississippi $49,772,592 – Florida $8,485,813 – North Carolina $3,498,889 – Georgia $25,345,199 – Ohio $14,802,500 – Illinois $8,932,507 – South Carolina $9,689,453 – Indiana $17,576,788 – Tennessee $26,137,862 – Kansas $18,942,367 – Texas $42,078,424 – Kentucky $30,962,548 – Wisconsin $9,070,392.
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Final Agenda For FCC September 30th Open Meeting
September 23, 2020 – The Federal Communications Commission Chairman has released the final agenda for the FCC’s open meeting on Wednesday, September 30, 2020:
Facilitating Shared Use in the 3.1-3.55 GHz Band – The Commission will consider a Report and Order that would remove the existing non-federal allocations from the 3.3-3.55 GHz band as an important step toward making 100 megahertz of spectrum in the 3.45-3.55 GHz band available for commercial use, including 5G, throughout the contiguous United States. The Commission will also consider a Further Notice of Proposed Rulemaking that would propose to add a co-primary, non-federal fixed and mobile (except aeronautical mobile) allocation to the 3.45-3.55 GHz band as well as service, technical, and competitive bidding rules for flexible-use licenses in the band. (WT Docket No. 19-348)
Expanding Access to and Investment in the 4.9 GHz Band – The Commission will consider a Sixth Report and Order that would expand access to and investment in the 4.9 GHz (4940-4990 MHz) band by providing states the opportunity to lease this spectrum to commercial entities, electric utilities, and others for both public safety and non-public safety purposes. The Commission also will consider a Seventh Further Notice of Proposed Rulemaking that would propose a new set of licensing rules and seek comment on ways to further facilitate access to and investment in the band. (WP Docket No. 07-100)
Improving Transparency and Timeliness of Foreign Ownership Review Process – The Commission will consider a Report and Order that would improve the timeliness and transparency of the process by which it seeks the views of Executive Branch agencies on any national security, law enforcement, foreign policy, and trade policy concerns related to certain applications filed with the Commission. (IB Docket No. 16-155)
Promoting Caller ID Authentication to Combat Spoofed Robocalls – The Commission will consider a Report and Order that would continue its work to implement the TRACED Act and promote the deployment of caller ID authentication technology to combat spoofed robocalls. (WC Docket No. 17-97)
Combating 911 Fee Diversion – The Commission will consider a Notice of Inquiry that would seek comment on ways to dissuade states and territories from diverting fees collected for 911 to other purposes. (PS Docket Nos. 20-291, 09-14)
Modernizing Cable Service Change Notifications – The Commission will consider a Report and Order that would modernize requirements for notices cable operators must provide subscribers and local franchising authorities. (MB Docket Nos. 19-347, 17-105)
Eliminating Records Requirements for Cable Operator Interests in Video Programming – The Commission will consider a Report and Order that would eliminate the requirement that cable operators maintain records in their online public inspection files regarding the nature and extent of their attributable interests in video programming services. (MB Docket No. 20-35, 17-105)
Reforming IP Captioned Telephone Service Rates and Service Standards – The Commission will consider a Report and Order, Order on Reconsideration, and Further Notice of Proposed Rulemaking that would set compensation rates for Internet Protocol Captioned Telephone Service (IP CTS), deny reconsideration of previously set IP CTS compensation rates, and propose service quality and performance measurement standards for captioned telephone services. (CG Docket Nos. 13-24, 03-123)
Enforcement Bureau Action – The Commission will consider an enforcement action.
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T-Mobile Tells FCC To Dismiss AT&T Challenge To T-Mobile 600 MHz Leases, Says Spectrum Screen Should Be Overhauled
September 22, 2020 – T-Mobile has requested the FCC dismiss, as procedurally deficient, a filing by AT&T challenging T-Mobile’s 600 MHz Spectrum Manager Lease arrangements with Channel 51 License Company LLC and LB License Co, LLC. AT&T submitted the filing in support of a petition for reconsideration filed by Verizon, which argues the leases “will exacerbate the extent to which T-Mobile exceeds the Commission’s 250 MHz screen for low- and mid-band spectrum in the relevant markets.” T-Mobile characterizes the AT&T comments as an effort by AT&T to slow down T-Mobile as a competitor and game the upcoming C-band auction to its advantage. T-Mobile, however, stated it agrees with AT&T that the spectrum screen is now anachronistic, omits relevant available spectrum, and sorely needs to be reassessed by the Commission. T-Mobile believes the FCC should issue a clarification with respect to the trigger for post-auction case-by-case review of spectrum holdings in the context of the FCC’s upcoming C-band auction. T-Mobile suggests that under such a case-by-case review, there should be “a presumption of no competitive harm where the spectrum won by any auction participant does not exceed one-third of the auctioned spectrum in a local market.”
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FCC & NARUC Urge State Governors To Reduce Intrastate Inmate Calling Rates
September 22, 2020 – The Federal Communications Commission (FCC) and the National Association of Regulatory Utility Commissioners (NARUC) have sent a letter to the National Governors Association to address “the too-often exorbitant rates and fees charged for inmates to make intrastate phone calls.” The FCC is taking action to address interstate and international calling rates, but only state and local leaders can address the rates and fees charged for in-state calls made by inmates. The FCC’s News Release announcing the letter explains that “[e]xorbitantly high rates and charges can impede the ability of incarcerated individuals to maintain vital connections by making it prohibitively expensive to stay in touch with their families. Studies have long shown that contact with family and other loved ones during incarceration reduces recidivism and lessens disruptive and anxious behaviors in children with incarcerated parents.” Accompanying the FCC and NARUC letter is a list of every prison and jail in the country that, according to an FCC information collection, had the highest 2019 reported charge for a 15-minute call.
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Southern Fiber Worx Forgot To File FCC Form 477, Seeks Waiver To Participate In RDOF Auction
September 21, 2020 – Southern Fiber Worx, LLC has filed a petition seeking waiver of Section 54.804(a)(7)(i)(A) of the FCC’s rules in order to qualify for participation in the FCC’s Rural Digital Opportunity Fund (RDOF) Phase I auction. Southern Fiber Worx, created in Georgia in 2015, currently serves 830 customers and has the potential to reach 3,000 homes. While completing an FCC Form 183 to participate in the FCC’s RDOF Phase I auction, Southern Fiber Worx discovered it “inadvertently neglected to file the three required Form 477s by June 17, 2020,” as required by the FCC’s RDOF rules and orders. It then immediately filed all three requisite Form 477s prior to the Form 183 filing deadline. Southern Fiber Worx is seeking a waiver of Section 54.804(a)(7)(i)(A) which “requires that an auction participant file the three Form 477s on a timely basis so that FCC staff can verify that a participant was operational during the relevant time period.” Southern Fiber Worx’s short form was listed as incomplete when the FCC announced the status of short-form applications received for participation in the RDOF Phase I auction.
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Next Meeting Of FCC Precision Ag Connectivity Task Force Set For October 28th
September 21, 2020 – The Federal Communications Commission has announced that the next meeting of the Task Force for Reviewing the Connectivity and Technology Needs of Precision Agriculture will be held Wednesday, October 28, 2020, beginning at 9:30 am EDT. The Task Force will consider and vote on reports from its Data and Mapping, Examining Current and Future Connectivity Demand for Precision Agriculture, and Encouraging Adoption of Precision Agriculture and Availability of High-Quality Jobs on Connected Farms working groups. Also, it will discuss the progress of its other working groups.
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Telecom Fiber Sues Four Former Employees, Alleges Misappropriation Of Trade Secret
September 21, 2020 – Telecom Fiber, LLC has filed a lawsuit against four former employees alleging misappropriation of trade secrets, unauthorized access of computer files, and breach of contract. The lawsuit was filed in U.S. District Court for The Northern District Of Georgia – Atlanta Division. Telecom Fiber, formed in Georgia, “constructs fiber optic networks and provides emergency response and maintenance services for fiber optic networks.” It describes itself as “a leading installer of fiber optic cable and service provider for fiber optic networks for the southeastern United States.” Telecom Fiber claims it has extensive trade secrets which include the following: the company’s operational structure; customer, supplier, and vendor contracts; pricing structure and pricing matrix; material costs pricing matrix; fiber technician training program; methods of reporting on-the-job test results; detailed records of its customers’ networks including building locations, network layouts, fiber routes, fiber splicing diagrams, as-built records, and distance records; fully-stocked service truck inventory and design; quality control procedures for the company’s services; and customer information and customer service model.
In its complaint, Telecom Fiber states that the four defendants had access to Telecom Fiber’s corporate Dropbox account which contained Telecom Fiber’s trade secrets. Telecom Fiber further alleges that over a roughly eight-hour period in November 2019, one of the defendants logged into the corporate Dropbox account and made copies of over 4,000 files stored on the account, which included Telecom Fiber’s Trade Secrets and documents related to Telecom Fiber’s biggest customer, Zayo. The defendant then resigned from the company the next day. Shortly thereafter, he began working with Vertical Communications, LLC as the regional manager for the Atlanta market. Sometime later, the three other defendants also began working for Vertical Communications. Telecom Fiber alleges that after the four defendants began working with Verticom, Zayo began working with Verticom and transferring its business from Telecom Fiber to Verticom. Based on these allegations, Telecom Fiber’s lawsuit contains the following claims:
Count I – Violation Of Georgia’s Computer Systems Protection Act (against one defendant)
Count II – Violation Of The Computer Fraud And Abuse Act (against one defendant)
Count III – Request For Interlocutory And Permanent Injunction (against all defendants)
Count IV – Breach Of Contract (against one defendant)
Count V – Breach Of Contract (against three defendants)
Count VI – Violation Of The Georgia Trade Secrets Act (against all defendants)
Count VII – Violation Of The Federal Defend Trade Secrets Acts (against all defendants)
Count VIII – Conversion (against all defendants)
Count IX – Civil Conspiracy (against all defendants)
Count X – Punitive Damages (against all defendants)
Count XI – Attorney’s Fees And Costs (against all defendants)
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Second E-Rate Filing Window For Funding Year 2020 Opens September 21st, Closes October 16th
September 21, 2020 – The FCC’s Wireline Competition Bureau Order opening a second E-Rate filing window for funding year 2020 has been published in the Federal Register. Accordingly, the second E-Rate filing window for funding year 2020 will open on September 21, 2020, and close on October 16, 2020. During the second filing window, E-Rate eligible schools may request E-Rate discounts for additional on-campus category one services to address increased on-campus bandwidth needs caused by the COVID-19 pandemic. Under certain circumstances, E-Rate schools also will not have to undergo a new competitive bidding process.
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Mergers & Acquisitions: Liberty Broadband Corporation & GCI Liberty, Inc.
September 18, 2020 – The FCC’s Wireline Competition Bureau, International Bureau, Wireless Telecommunications Bureau, and Media Bureau are seeking comment on applications filed by GCI Liberty, Inc. (GCI Liberty), and Liberty Broadband Corporation (Liberty Broadband) pursuant to Sections 214 and 310(d) of the Communications Act, the Cable Landing License Act of 1921, and various FCC rules seeking approval to transfer control of various licenses and authorizations held by operating subsidiaries indirectly held by GCI Liberty to Liberty Broadband.
GCI Liberty is a publicly traded Delaware corporation. Its wholly owned subsidiary, GCI Holdings, LLC, through operating subsidiaries, provides local exchange, exchange access, domestic intrastate and interstate interexchange, commercial mobile radio and data, cable television, Internet access, broadcast television, wholesale submarine cable capacity, and other communications services throughout Alaska, between Alaska and the 48 contiguous states, and in certain other geographic regions.
Liberty Broadband is a Delaware publicly traded holding corporation. Liberty Broadband beneficially owns approximately a 23.4% equity interest (on a fully diluted basis) in Charter and a 25.01% voting interest in Charter. Liberty Broadband’s wholly-owned subsidiary, Skyhook, offers mobile positioning and contextual location intelligence solutions.
Upon consummation of the proposed transaction, Liberty Broadband will own GCI Liberty’s existing wholly-owned subsidiaries, including GCI Holdings and its operating subsidiaries that hold FCC licenses and authorizations to provide communications services. Comments are due on or before October 2, 2020, and reply comments are due October 9, 2020.
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AT&T Joins Verizon’s Challenge To T-Mobile 600 MHz Leases, Spectrum Holdings
September 18, 2020 – AT&T Services, Inc., on behalf of its affiliates, has filed comments in response to Verizon’s petition for reconsideration of the Wireless Telecommunications Bureau’s acceptance of T-Mobile’s Spectrum Manager Lease arrangements with Channel 51 License Company LLC and LB License Co, LLC, and T-Mobile’s opposition to the petition. AT&T argues that the combination of Sprint and T-Mobile has resulted in an unprecedented concentration of spectrum in the hands of one carrier, necessitating much more transparency into how the FCC evaluates transactions (and auction applications) involving spectrum aggregation in excess of the screen, changes in the FCC’s review process, and a re-examination of how the FCC approaches its spectrum screen. The 600 MHz licenses at issue were originally won by AT&T at auction, but later sold to Columbia Capital. Verizon filed its petition in August 2020 seeking reconsideration of the Wireless Telecommunications Bureau’s acceptance of T-Mobile License LLC’s Spectrum Manager Lease arrangements with Channel 51 License Company LLC and LB License Co, LLC (Application File Nos. 0009021213 & 0009021220). Verizon argues the lease agreements “will exacerbate the extent to which T-Mobile exceeds the Commission’s 250 MHz screen for low- and mid-band spectrum in the relevant markets, including those where it already exceeds the screen by more than 100 MHz.”
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USDA Announces $7.5 Million ReConnect Program Broadband Award In South Carolina
September 17, 2020 – The U.S. Department of Agriculture has announced a $7.5 million ReConnect Program broadband loan has been awarded to OneTone Telecommunications in rural South Carolina. OneTone Telecommunications will receive a $7.5 million loan to deploy a fiber-to-the-premises network that will connect 12,938 people, 29 businesses, and three educational facilities to high-speed broadband internet in Anderson and Oconee counties in South Carolina. The funded service area includes 5,263 households spread over 2.67 square miles. The loan is the 12th award made under the second round of the ReConnect Program. This brings the total funding made in the second round to $128,049,562.
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Agenda Set For September 22 FTC Virtual Workshop On Data Portability
September 17, 2020 – The Federal Trade Commission will hold a virtual workshop on data portability on Tuesday September 22, 2020. The workshop will examine the potential benefits and challenges to consumers, privacy, and competition raised by data portability, defined as the “ability of consumers to move data from one service to another or to themselves.” It will run from 8:30 a.m. to 3 p.m. ET. The full agenda is available online.
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FCC Electronic Licensing Order Finalizes Transition To All Electronic Filings In The Wireless Radio Services
September 17, 2020 – The FCC has released on Order which finalizes the transition to electronic interactions for licenses, authorizations, and correspondence in the Wireless Radio Services. In the 2019 Electronic Licensing Notice of Proposed Rulemaking the FCC proposed to make all filings to the Universal Licensing System (ULS) completely electronic; expand electronic filing and correspondence elements for related systems; and require applicants to provide an e-mail address on related FCC Forms; and sought comment on additional rule changes that would further expand the use of electronic filing and electronic service. In the Electronic Licensing Order, the FCC explains that it manages applications for all Wireless Radio Service licenses through the Universal Licensing System (ULS). Related systems accept filings and work in conjunction with or alongside of ULS, including the Antenna Structure Registration (ASR) System, the Tower Construction Notification System (TCNS), and the Electronic Section 106 (E-106) System. While the majority of applications filed in ULS are electronic, exceptions to mandatory electronic filing remain for a number services. The FCC’s Electronic Licensing Order adopts the following changes:
The FCC has removed the remaining exemptions to mandatory electronic filing in ULS and require electronic filing in the ASR System.
The FCC now requires electronic filing of pleadings related to Wireless Radio Services licenses and applications in these systems and requires electronic service where service of such pleadings is required.
All applicants, licensees, and registrants in the Wireless Radio Services must include at least one valid e-mail address on the relevant FCC Forms.
The FCC has moved away from U.S. Postal Service to electronic delivery of correspondence generated from these systems to applicants, licensees, and registrants in the Wireless Radio Services.
There is a transition deadline of six months for these changes to take effect.
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Senators Urge FCC To Use E-Rate Funding To Help Students Obtain In-Home Broadband Service
September 17, 2020 – A group of 30 Senators led by Senator Ed Markey (D-MA) have sent a letter to FCC Chairman Ajit Pai which urges the FCC “to immediately utilize the E-Rate program to provide internet connectivity to students at home.” According to the press release announcing the letter, “studies indicate that as many as 16 million children in the United States lack internet access at home and are unable to participate in online learning.” The Senators argue the FCC has clear authority under the E-Rate program to use available funding to start connecting students immediately. They argue that the federal E-Rate statute “does not preclude the FCC from expanding [the] program to fund connections at students’ homes —which, because schools have had to close their doors, have become de facto classrooms for millions of children.”
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FCC Releases Report On Broadband Services Derived From FCC Form 477 Data
September 16, 2020 – The FCC’s Office of Economics & Analytics, Industry Analysis Division has released a report on “Internet Access Services: Status as of December 31, 2018,” which summarizes information about Internet access connections in the U.S. as of December 31, 2018, as collected by FCC Form 477. Key data in the report include the following:
Total Connections. Total Internet connections increased by about 4.9% between December2017 and December 2018 to 441 million. Mobile Internet connections increased 5.7% year-over-year to 331 million in December 2018, while fixed connections grew to 111 million – up about 2.5% from December 2017.
Downstream Speeds. The percentage of fixed connections with a downstream speed of at least 25 Mbps has grown from 54% (or 55 million connections) in December 2015 to 76% (or 85 million connections) in December 2018. Over the same period, the percentage of fixed connections with downstream speeds of less than 3 Mbps has decreased from 6% (or 6 million connections) in December 2015 to 2% (or about 2.4 million connections) in December 2018
Typical Speeds. The median downstream speed of all reported fixed connections was 100 Mbps and the median upstream speed was 10 Mbps. For residential fixed connections, the median downstream speed was 100 Mbps and the median upstream speed was 10 Mbps.
Residential Connections. Residential fixed Internet access connections increased by about 2.6% between December 2017 and December 2018, to ~101 million. Residential (non-business) mobile wireless Internet access connections on mobile devices with data plans for full Internet access increased by about 5.6%, to 267 million, between December2017 and December 2018.
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President Trump Nominates Nathan Simington To Fill O’Rielly’s Federal Communications Commission Seat
September 16, 2020 – President Trump has nominated Nathan Simington to be a Member of the Federal Communications Commission for a term of five years from July 1, 2019. Mr. Simington is currently a Senior Advisor in the National Telecommunications and Information Administration (NTIA). The nomination will fill the seat formerly held by Michael O’Rielly. In August 2020, the White House withdrew the reappointment nomination of Commissioner O’Rielly after the Commissioner gave a speech to the Media Institute in which he said demands for private actors to curate or publish speech in a certain way should be rejected. Commissioner O’Rielly’s reappointment was sent to the Senate on March 18, 2020. His current term as an FCC Commissioner expired at the end of June 2019, but he may continue to serve until the close of the next Congress.
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FCC Announces Opening Of Second E-Rate Application Window For Funding Year 2020; Will Close On October 16th
September 16, 2020 – The FCC’s Wireline Competition Bureau has announced the opening of a second E-Rate filing window for funding year 2020 to allow schools to request additional E-Rate funding to address increased on-campus bandwidth needs. The decision is made on an emergency basis, without notice and comment. During this second funding year 2020 filing window, E-Rate eligible schools will be allowed to request additional funding for the limited purpose of purchasing more broadband bandwidth without having to undergo a new competitive bidding process. The window will open upon publication of the Bureau’s Order in the Federal Register, and will close on October 16, 2020.
According to the FCC’s News Release, “during this second filing window, schools will be able to purchase additional bandwidth for this academic year to address needs resulting from the increasing shift to 1:1 student-to-device ratios in classrooms, live streaming of classroom instruction to students at home, and expanding use of cloud-based educational tools and platforms – all of which can significantly increase on-campus bandwidth requirements.”
Normally, funding year 2020 runs from July 1, 2020 through June 30, 2021, with a filing window from January 15, 2020 through April 29, 2020. The Universal Service Administrative Company (USAC) received 38,207 applications requesting $2.91 billion in discounts for eligible services during this filing window. The Bureau notes, however, that applicants conducted competitive bidding and requested E-Rate funding before they were forced to fully or partially transition to remote learning. Since the beginning of the 2020 school year, most school districts are relying on remote learning, either in whole or in part, which has dramatically increased demand on school networks and broadband access requirements.
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FCC Filing Requirement: Designated Entity Annual Reports Due September 30th
September 15, 2020 – Every designated entity (DE) licensee must file an annual DE report with the FCC by September 30, 2020. More specifically, each DE licensee must submit an annual report reflecting the status of each license held as of August 31, 2020 that is subject to the FCC’s unjust enrichment requirements. Pursuant to Section 1.2110(n) of the FCC’s rules, the annual DE report must include, at a minimum, a list and summaries of all agreements and arrangements, including proposed agreements and arrangements, that relate to eligibility for designated entity benefits. In addition, the list must include the parties, including affiliates, controlling interests, and affiliates of controlling interests, to each agreement or arrangement, as well as the dates on which the parties entered into each agreement or arrangement. Licensees must file DE reports electronically using Form 611-T. Failure to comply with the annual DE reporting requirement may result in enforcement action by the FCC.
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FCC Upholds Retrans Complaint, Issues $512,228 Fine Against Eighteen Broadcast Stations For Failing To Negotiate In Good Faith
September 15, 2020 – The FCC has issued a Memorandum Opinion And Order upholding an FCC Media Bureau decision that 18 broadcast stations failed to negotiate in good faith with DIRECTV, LLC, and AT&T Services, Inc. for consent to carry the signals of 18 broadcast television stations. In the Bureau’s November 2019 decision, the Bureau granted AT&T’s complaint, finding that the broadcast station “Defendants refused to negotiate, unreasonably delayed negotiations, and failed to respond to AT&T’s carriage proposals, each constituting a per se breach of the duty to negotiate in good faith.” Along with the order affirming the Media Bureau’s decision, the FCC issued a Notice Of Apparent Liability For Forfeiture proposing a penalty of $512,228 against each of the eighteen stations.
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FCC Announces 157 Tribal Priority Window Applications Are Acceptable For Filing
September 15, 2020 – The FCC’s Wireless Telecommunications Bureau has announced that 157 Rural Tribal Priority Window applications for 2.5 GHz band spectrum licenses have been found, upon initial review, to be acceptable for filing. The Rural Tribal Priority Window opened in February 2020, giving Tribal entities an opportunity to apply for spectrum licenses in the 2.5 GHz band to serve rural Tribal areas without having to bid in an FCC spectrum auction. More than 400 applications were filed during the priority filing window. The 157 Rural Tribal Priority Window applications that have passed initial review are listed on an Attachment to the Bureau’s Public Notice. Petitions to deny the applications must be filed no later than October 15, 2020. Oppositions to a petition to deny must be filed no later than October 26, 2020. Replies to oppositions must be filed no later than November 2, 2020.
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Fourth Quarter 2020 USF Contribution Factor Increases To 27.1 Percent, Smashes Previous Record!
September 14, 2020 – The Federal Communications Commission’s Office of Managing Director has announced that the proposed universal service fund (USF) contribution factor for the fourth quarter of 2020 will be 27.1 percent. This breaks the previous USF contribution factor record of 26.5 percent set during the third quarter of 2020. It also makes 2020’s average contribution factor 23.3 percent, the highest yearly average ever. The four USF contribution factors for 2020 and the average for the year are as follows:
2020Q1 – 20
2020Q2 – 19.6
2020Q3 – 26.5
2020Q4 – 27.1
2020 USF contribution factor average: 23.3
For the fourth quarter of 2020, the Universal Service Administrative Company (USAC) projects $10.42838 billion in total interstate and international end-user telecommunications revenues will be collected. USAC estimates that $2.204790 billion is needed to cover the total demand and expenses for all Federal universal service support mechanisms in the fourth quarter of 2020. If the FCC takes no action on the proposed USF contribution factor within 14 days, it will be declared approved. Historical information on quarterly universal service fund contribution factors is available online from the FCC.
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FCC Releases Rural Call Completion Report, Comments Due October 29th
September 14, 2020 – The FCC’s Wireline Competition Bureau has released a report on the effectiveness of the FCC’s rural call completion rules, along with a related request for comment. In the Report, the Bureau finds that the rules the FCC adopted in the Second Rural Call Completion Order, including the covered provider monitoring and point of contact requirements, and the elimination of the data reporting requirement, have been effective in contributing to a reduction call completion issues and improving overall rural call completion. The Bureau seeks comment on this conclusion. The Bureau also seeks comment on the effectiveness of the intermediate provider service quality standards adopted in the Fourth Rural Call Completion Order. That order imposed a general duty intermediate providers to complete calls; adopted service quality standards for intermediate providers; and adopted an exception to those standards for intermediate providers that qualify for the covered provider safe harbor in the FCC’s existing rules. Interested parties may file comments in response to the Report and the Bureau’s findings on or before October 29, 2020.
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Verizon Acquiring TracFone In $6 Billion Deal
September 14, 2020 – Verizon has announced it has entered into an agreement with America Movil to acquire TracFone Wireless, Inc. Verizon will pay America Movil $3.125 billion in cash and $3.125 billion in Verizon common stock. Verizon expects the transaction to close in the second half of 2021. TracFone is a mobile virtual network operator (MVNO) that utilizes the networks of all three nationwide mobile wireless providers, and provides service under various brands, including Simple Mobile, Straight Talk wireless, and SafeLink Wireless. TracFone specializes in prepaid wireless service, and is estimated to have over 20 million prepaid wireless subscribers and over 90,000 retail locations in the U.S.
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DC Circuit Court Of Appeals Denies ACA’s C-Band Writ Of Mandamus
September 14, 2020 – The U.S. Court of Appeals for the District of Columbia Circuit has denied ACA Connects’ petition for a writ of mandamus seeking a halt to the FCC’s September 14 deadline for incumbent earth-station operators to elect a lump sum payment as part of the C-Band transition. Generally, ACA was challenging the Wireless Telecommunications Bureau’s decision to exclude from the lump-sum total the cost of integrated receiver/decoders that earth stations require for relocation. The D.C. Circuit concluded ACA failed to demonstrated a likelihood of success on the merits. Among other things, the court was not persuaded by ACA’s arguments that “the Wireless Telecommunications Bureau was required by regulation to include certain costs for purchasing decoders when determining a lump sum amount, or that the process the Bureau used to ultimately determine that lump sum amount was arbitrary and capricious.”
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FCC Modifies DISH Network Spectrum Licenses
September 11, 2020 – The FCC’s Wireless Telecommunications Bureau has modified the license terms and revised the construction deadlines for various spectrum licenses held by DISH Network Corporation. DISH’s licenses also now carry certain obligations to provide 5G services using the spectrum. DISH made the request to modify its spectrum licenses in 2019 when DISH was added to the U.S. Department of Justice’s settlement allowing T-Mobile and Sprint to combine. The DOJ settlement required T-Mobile and Sprint divest spectrum, prepaid wireless businesses, cell sites, and physical assets to DISH, in an effort to prop up DISH as a new fourth nationwide mobile wireless carrier. The Wireless Bureau’s action applies to the following DISH licenses: AWS H Block; AWS-4; Lower 700 MHz E Block Band; and 600 MHz Band.
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USDA Announces $21.6 Million ReConnect Program Broadband Award In North Carolina
September 11, 2020 – The U.S. Department of Agriculture has announced a $21.6 million ReConnect Program broadband grant has been awarded to Atlantic Telephone Membership Corporation in rural North Carolina. ATMC will receive a $21.6 million grant to construct a fiber-to-the-premises network which will bring high-speed broadband internet access to 17,424 people, 209 farms, 285 businesses, 19 educational facilities, nine health care facilities, seven fire stations, and seven post offices in Pender County. The funded service area includes 6,853 households spread over 539.44 square miles. The grant is the 11th award made under the second round of the ReConnect Program.
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Mississippi Public Service Commission Subpoenas AT&T For Broadband Deployment Records
September 10, 2020 – The Mississippi Public Service Commission has issued an investigative subpoena for records from AT&T regarding the company’s acceptance of $283,780,632 from the FCC’s Connect America Fund to expand broadband service to 133,000 locations in Mississippi. Prior to issuing the subpoena, the Mississippi PSC sent AT&T an informal request “for documentation related to the actual number of locations benefitting from the $280 million project,” but AT&T did not reply. The Mississippi PSC’s subpoena “demands production of documents showing the number of actual subscribers to AT&T’s fixed wireless service within the 133,000 locations where the company claims to have provided service, the number of complaints filed with the company by customers who have taken service and the number of Mississippians who applied for fixed wireless service based on AT&T’s assertion that it was available and were later determined not to be in an area covered.”
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Mergers & Acquisitions: Future Fiber Purchasing Otelco
September 10, 2020 – The FCC’s Wireline Competition Bureau is seeking comment on a Section 214 application filed by Otelco Inc. and Future Fiber FinCo, Inc. requesting consent to transfer control of Otelco Inc. and its subsidiaries to Future Fiber. Comments are due on or before September 24, 2020, and reply comments are due October 1, 2020. Otelco is a publicly traded Delaware corporation and holding company that provides telecommunications services through subsidiaries in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont, and West Virginia. Future Fiber, a newly formed Delaware corporation created for the purpose of completing the proposed transaction, is primarily owned and controlled by funds and entities affiliated with Oak Hill Capital Management, a private equity fund based in the United States but whose funds are organized in the Cayman Islands. Pursuant to an Agreement and Plan of Merger, Olympus Merger Sub, Inc., a Delaware corporation and direct, wholly owned subsidiary of Future Fiber created for the transaction, will merge with and into Otelco where upon the separate corporate existence of Olympus will cease, and Otelco will continue as the surviving entity. As a result, Otelco will be a direct, wholly owned subsidiary of Future Fiber, and Otelco’s telecom subsidiaries will be indirect, wholly owned subsidiaries of Future Fiber.
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USDA Announces $2.3 Million ReConnect Program Broadband Award In North Carolina
September 10, 2020 – The U.S. Department of Agriculture has announced a $2.3 million ReConnect Program broadband grant has been awarded to Randolph Telephone Membership Corporation in rural North Carolina. RTMC will receive a $2.3 million grant to deploy a fiber-to-the-premises network to bring high-speed broadband internet access service to 3,333 people, 17 farms, 26 businesses, and nine educational facilities in northern Moore County. The funded service area includes 1,302 households spread over 16.24 square miles. The grant is part of the $100 million Congress allocated to the ReConnect Program through the CARES Act, and is the 10th award made in the second round of USDA’s ReConnect Program.
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Cryptocurrency: Portion Of Digital Taxonomy Act Of 2019 Passes Full House Committee On Energy And Commerce
September 9, 2020 – A portion of the Digital Taxonomy Act of 2019 has been approved by the U.S. House of Representatives’ Committee on Energy and Commerce. Introduced in April 2019, the Digital Taxonomy Act, H.R. 2154, would have authorized funding for the Federal Trade Commission to prevent unfair or deceptive acts or practices relating to digital tokens and digital token transactions, and required the FTC to report to Congress on efforts to carry out that mission. During a full Energy and Commerce Committee markup session, an amendment in the form of a substitute was made to the bill, which added part of the original legislation to H.R. 8128, the AI for Consumer Product Safety Act. Specifically, only the portion of the Digital Taxonomy Act requiring the FTC to report to Congress on actions taken to prevent unfair or deceptive acts or practices relating to digital tokens was included. The amendment also added H.R.8153, the Blockchain Innovation Act, and renamed H.R. 8128 the Consumer Safety Technology Act. The bill was passed by the full committee and can now be sent to the full House for consideration.
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FCC Releases Tentative Agenda For September Open Meeting
September 9, 2020 – Federal Communications Commission Chairman Ajit Pai has announced the following tentative agenda for the FCC’s next open meeting scheduled for Wednesday, September 30, 2020:
Facilitating Shared Use in the 3.1-3.55 GHz Band – The Commission will consider a Report and Order that would remove the existing non-federal allocations from the 3.3-3.55 GHz band as an important step toward making 100 megahertz of spectrum in the 3.45-3.55 GHz band available for commercial use, including 5G, throughout the contiguous United States. The Commission will also consider a Further Notice of Proposed Rulemaking that would propose to add a co-primary, non-federal fixed and mobile (except aeronautical mobile) allocation to the 3.45-3.55 GHz band as well as service, technical, and competitive bidding rules for flexible-use licenses in the band. (WT Docket No. 19-348)
Expanding Access to and Investment in the 4.9 GHz Band – The Commission will consider a Sixth Report and Order that would expand access to and investment in the 4.9 GHz (4940-4990 MHz) band by providing states the opportunity to lease this spectrum to commercial entities, electric utilities, and others for both public safety and non-public safety purposes. The Commission also will consider a Seventh Further Notice of Proposed Rulemaking that would propose a new set of licensing rules and seek comment on ways to further facilitate access to and investment in the band. (WP Docket No. 07-100)
Improving Transparency and Timeliness of Foreign Ownership Review Process – The Commission will consider a Report and Order that would improve the timeliness and transparency of the process by which it seeks the views of Executive Branch agencies on any national security, law enforcement, foreign policy, and trade policy concerns related to certain applications filed with the Commission. (IB Docket No. 16-155)
Promoting Caller ID Authentication to Combat Spoofed Robocalls – The Commission will consider a Report and Order that would continue its work to implement the TRACED Act and promote the deployment of caller ID authentication technology to combat spoofed robocalls. (WC Docket No. 17-97)
Combating 911 Fee Diversion – The Commission will consider a Notice of Inquiry that would seek comment on ways to dissuade states and territories from diverting fees collected for 911 to other purposes. (PS Docket Nos. 20-291, 09-14)
Modernizing Cable Service Change Notifications – The Commission will consider a Report and Order that would modernize requirements for notices cable operators must provide subscribers and local franchising authorities. (MB Docket Nos. 19-347, 17-105)
Eliminating Records Requirements for Cable Operator Interests in Video Programming – The Commission will consider a Report and Order that would eliminate the requirement that cable operators maintain records in their online public inspection files regarding the nature and extent of their attributable interests in video programming services. (MB Docket No. 20-35, 17-105)
Reforming IP Captioned Telephone Service Rates and Service Standards – The Commission will consider a Report and Order, Order on Reconsideration, and Further Notice of Proposed Rulemaking that would set compensation rates for Internet Protocol Captioned Telephone Service (IP CTS), deny reconsideration of previously set IP CTS compensation rates, and propose service quality and performance measurement standards for captioned telephone services. (CG Docket Nos. 13-24, 03-123)
Enforcement Bureau Action – The Commission will consider an enforcement action.
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USDA Announces $9.8 Million ReConnect Program Broadband Award In Tennessee
September 9, 2020 – The U.S. Department of Agriculture has announced a $9.8 million ReConnect Program broadband grant and loan combination has been awarded to Ardmore Telephone Company in rural Tennessee. Ardmore Telephone Company will receive a $4.9 million grant and a $4.9 million loan to deploy a fiber-to-the-premises network to connect high-speed broadband internet access service to 4,005 people, 263 farms, 28 businesses, four educational facilities, and one fire station in Benton, Giles and Lincoln counties in Tennessee. The funded service area includes 1,658 households spread over 128.55 square miles. Funding for the award was allocated through the CARES Act and from the $550 million available in the second round of ReConnect Program.
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FCC Supply Chain Security Information Collection Report Estimates $1.837 Billion Cost To Remove Huawei & ZTE Equipment
September 4, 2020 – The FCC’s Wireline Competition Bureau and Office of Economics and Analytics have released a Public Notice showing the results from the Supply Chain Security Information Collection, which was conducted pursuant to the FCC’s 2019 Supply Chain Order. The Public Notice contains a list of Eligible Telecommunications Carriers (ETCs) that have reported the presence or use of Huawei or ZTE equipment or services in their networks, or in the networks of their affiliates or subsidiaries. After reviewing the submitted data, the Bureau estimates it could cost $1.837 billion to remove and replace Huawei and ZTE equipment found in the networks of all communications providers that filed information with the FCC.
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SpaceX Claims Starlink Satellite Broadband Service Beta Tests Achieve 100 Mbps Download Speeds
September 4, 2020 – In a recent ex parte with the FCC, Space Exploration Holdings, LLC (SpaceX) claims its Starlink satellite broadband service can achieve download speeds of just over 100 Mbps with latency below 30 ms. SpaceX conducted the ex parte in support of the April 2020 application it filed with the FCC’s International Bureau asking for permission to modify its current FCC authorization to operate its Starlink satellite network at lower altitudes. Specifically, SpaceX seeks to lower the altitude of the 2824 satellites in the upper shell of its Starlink constellation from 1100-1330 km to 540-570 km. The SpaceX ex parte slide deck contains screen shots from Starlink beta tests, as well as additional information on the status of Starlink: SpaceX is manufacturing 120 Starlink satellites each month; SpaceX has deployed over 650 satellites to date, making it the largest satellite constellation in the world; and SpaceX “is on track: to produce thousands of consumer user terminals per month.
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Mergers & Acquisitions: Consolidated Companies, Inc. Purchasing Another Nebraska Rural ILEC
September 3, 2020 – The FCC’s Wireline Competition Bureau is seeking public comment on a Section 214 application filed by Sodtown Telephone Company (STC) and Sodtown Communications, Inc. (SCI) requesting consent to transfer the telecommunications assets and customer base of STC to SCI. Comments are due on or before September 17, 2020, and reply comments are due September 24, 2020. STC is a Nebraska a rural incumbent local exchange carrier (LEC) serving approximately 56 access lines in portions of Buffalo and Hall Counties in Central Nebraska. SCI is a wholly owned subsidiary of Consolidated Companies, Inc. that was formed to facilitate the purchase of STC’s assets. Consolidated Companies, Inc. owns four other Nebraska LECs and an interexchange carrier serving North Central and Southwestern Nebraska. Pursuant to an asset purchase agreement, SCI will purchase all of the operating assets and customer base of STC. STC and Consolidated’s four Nebraska LECs receive high-cost universal service fund support under the Alternative Connect America Cost Model.
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FCC To Fine BarrierFree Communications $163,912 For Reporting Inaccurate Broadband Deployment Data
September 2, 2020 – The Federal Communications Commission has issued a Notice Of Apparent Liability For Forfeiture against Barrier Communications Corporation d/b/a BarrierFree for apparently reporting inaccurate FCC Form 477 broadband deployment information. The FCC proposes a $163,912 fine, which is the statutory maximum. As set out in the NAL, BarrierFree, a fixed wireless broadband service provider, apparently failed to file FCC Form 477 twenty-seven times and apparently filed inaccurate FCC Form 477 data on four other occasions: in its March 2018 filing; its revised March 2018 filing; its September 2019 filing; and its March 2020 filing. Additionally, after receiving Letters of Inquiry from the FCC, BarrierFree apparently provided non-responsive and inaccurate responses to the FCC’s Enforcement Bureau.
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CBRS Auction Concludes: 228 Winning Bidders, $4.54 Billion In Net Bids
September 2, 2020 – The FCC has announced that Auction 105 has concluded. Auction 105 raised a total of $4,543,232,339 in net bids ($4,585,663,345 in gross bids), with 228 bidders winning a total of 20,625 Priority Access Licenses in the 3550-3650 MHz portion of the 3.5 GHz band. The five bidders with the largest total winning bid amounts were:
Verizon Wireless Network Procurement LP – $1,893,791,991
Wetterhorn Wireless LLC (Dish) – $912,939,410
Spectrum Wireless Holdings, LLC – $464,251,209
XF Wireless Investment, LLC – $458,725,900
Cox Communications, Inc. – $212,805,412
The 228 bidders won 20,625 of 22,631, or more than 91.1%, of available licenses. The five bidders winning the largest number of licenses were:
Wetterhorn Wireless LLC (Dish) – 5,492
SAL Spectrum, LLC – 1,569
AMG Technology Investment Group, LLC – 1,072
Windstream Services LLC, Debtor-in-Possession – 1,014
XF Wireless Investment, LLC – 830
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FCC Authorizes $5.2 Million In CAF II Auction Support In Mississippi For Viasat
September 2, 2020 – The FCC’s Wireline Competition Bureau has authorized Connect America Fund Phase II auction support for one winning bid made by Viasat Carrier Services, Inc. in Mississippi. Viasat will receive $5,206,700.80 over 10 years to provide broadband access to 13,819 locations. The Bureau has directed the Universal Service Administrative Company to obligate and disburse Universal Service Fund support to Viasat in 120 monthly payments, which will begin at the end of September 2020. Additional information on Viasat’s funding is available on the FCC’s CAF II Auction site.
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USAC Files Fourth Quarter 2020 USF Contribution Base Data: $10.428 Billion
September 1, 2020 – The Universal Service Administrative Company (USAC) has filed information on the universal service fund (USF) contribution base to be used for the fourth quarter of calendar year 2020. This consists of the total interstate and international end-user revenue amount that will be used to determine the contribution factor for the universal service support mechanisms. USAC has calculated the total projected collected interstate and international end-user revenue base for the fourth quarter of 2020 to be $10,428,377,862. To provide a reference point, the USF contribution base for the four quarters of 2020 are as follows:
Fourth quarter 2020: $10,428,377,862
Third quarter 2020: $10,219,123,520
Second quarter 2020: $10,865,131,593
First quarter 2020: $11,129,976,956
USAC’s estimated revenue base for the fourth quarter of 2020 was derived from projected collected revenue reported by telecommunications service providers using FCC Form 499-Q in August 2020 – 4,200 reporting carriers, of which 3,051 are USF contributors and 1,149 are non-contributing de minimis carriers. Upon Federal Communications Commission approval of the total USF contribution base, the quarterly funding requirements for the four USF support mechanisms, and projected administrative costs, the FCC will establish a quarterly USF contribution factor. USAC will then bill USF contributors on a monthly basis for their individual obligations based on the approved contribution factor.
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Comments On Request For Waiver Of Lifeline Service Standards Due September 14
September 1, 2020 – The FCC’s Wireline Competition Bureau is seeking public comment on a petition filed by the National Lifeline Association requesting waiver of the scheduled December 1, 2020 increase in the Lifeline Program’s mobile broadband minimum service standard and decrease in the Lifeline support amount for voice service. Comments are due on or before September 14, 2020. Reply comments are due September 21, 2020. In its petition for waiver, the National Lifeline Association requests that the FCC retain the mobile broadband minimum service standard at 3 GB rather than increasing it to 11.75 GB as planned, and retain Lifeline voice support at $7.25 rather than decreasing it to $5.25 as planned.
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FCC Announces Status Of RDOF Auction Applications: 121 Complete
September 1, 2020 – The FCC has announced the status of 505 short-form applications received for Auction 904, the Rural Digital Opportunity Fund Phase I auction.
Complete – 121 applications
Incomplete – 384 applications
For the incomplete applications, each applicant has not provided required certifications and basic information, or the applicant has not been determined to be financially or operationally qualified to bid in all the states or for all the performance tier and latency combinations selected. Applicants may correct their deficiencies and resubmit their applications prior to 6:00 p.m. ET on Wednesday, September 23, 2020. Bidding in Auction 904 will begin on Thursday, October 29, 2020.
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IRS Memo Says Virtual Currency Received In Crowdsourcing Labor Market Is Taxable Income
September 1, 2020 – The Internal Revenue Service has issued a memorandum on Taxation of Virtual Currency Received in the Crowdsourcing Labor Market. The memo addresses the question of whether convertible virtual currency received by an individual for performing a microtask through a crowdsourcing or similar platform is taxable income. IRS says the answer is yes – a taxpayer who receives convertible virtual currency in exchange for performing a microtask through a crowdsourcing platform has received consideration in exchange for performing a service, and the convertible virtual currency received is taxable as ordinary income.
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