Skip Navigation

Federal Communications Commission

English Display Options

Commission Document

Accessibility rules for advanced communications services

Download Options

Released: October 7, 2011

Federal Communications Commission

FCC 11-151

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Implementation of Sections 716 and 717 of
)
CG Docket No. 10-213
the Communications Act of 1934, as Enacted
)
by the Twenty-First Century Communications )
and Video Accessibility Act of 2010
)
)

Amendments to the Commission's Rules
)
Implementing Sections 255 and 251(a)(2) of
)
WT Docket No. 96-198
the Communications Act of 1934, as Enacted
)
by the Telecommunications Act of 1996
)
)

In the Matter of Accessible Mobile Phone
)
Options for People who are Blind, Deaf-
)
CG Docket No. 10-145
Blind, or Have Low Vision
)

REPORT AND ORDER AND FURTHER NOTICE OF PROPOSED RULEMAKING

Adopted: October 7, 2011

Released: October 7, 2011

Comment Date: (45 days after date of publication in the Federal Register)
Reply Comment Date: (75 days after date of publication in the Federal Register)

By the Commission: Chairman Genachowski and Commissioners McDowell and Clyburn issuing
separate statements; Commissioner Copps approving in part, dissenting in part and issuing a
statement.

TABLE OF CONTENTS

Heading
Paragraph #
I. INTRODUCTION AND BACKGROUND ..............................................................................1
II. EXECUTIVE SUMMARY .....................................................................................................13
III. REPORT AND ORDER..........................................................................................................30
A. Scope and Obligations .......................................................................................................30
1. Advanced Communications Services ..........................................................................30
a. General...................................................................................................................30
b. Interconnected VoIP Service .................................................................................33
c. Non-interconnected VoIP Service .........................................................................40
d. Electronic Messaging Service ...............................................................................42

Federal Communications Commission

FCC 11-151

e. Interoperable Video Conferencing Service ...........................................................46
2. Manufacturers of Equipment Used for Advanced Communications
Services........................................................................................................................52
3. Providers of Advanced Communications Services .....................................................81
4. General Obligations.....................................................................................................91
a. Manufacturers and Service Providers....................................................................92
b. Providers of Applications or Services Accessed over Service
Provider Networks.................................................................................................95
c. Network Features...................................................................................................97
d. Accessibility of Information Content ..................................................................100
5. Phased in Implementation .........................................................................................105
B. Nature of Statutory Requirements ...................................................................................114
1. Achievable Standard..................................................................................................114
a. Definitions ...........................................................................................................114
(i) Accessible to and Usable by..........................................................................114
(ii) Disability .......................................................................................................117
b. General Approach................................................................................................119
c. Specific Factors ...................................................................................................127
(i) Nature and Cost of Steps Needed with Respect to Specific
Equipment or Service ....................................................................................127
(ii) Technical and Economic Impact on the Operation .......................................131
(iii)Type of Operations ........................................................................................136
(iv)Extent to which Accessible Services or Equipment are Offered
with Varying Functionality, Features, and Prices..........................................140
2. Industry Flexibility ....................................................................................................149
3. Compatibility.............................................................................................................158
C. Waivers and Exemptions.................................................................................................170
1. Customized Equipment or Services...........................................................................170
2. Waivers for Services or Equipment Designed Primarily for Purposes
other than Using ACS................................................................................................179
3. Exemptions for Small Entities Temporary Exemption of Section 716
Requirements .............................................................................................................201
D. Additional Industry Requirements and Guidance ...........................................................210
1. Performance Objectives.............................................................................................210
2. Safe Harbors ..............................................................................................................213
3. Prospective Guidelines ..............................................................................................216
E. Section 717 Recordkeeping and Enforcement.................................................................219
1. Recordkeeping ...........................................................................................................219
2. Enforcement...............................................................................................................231
a. Overview .............................................................................................................231
b. General Requirements .........................................................................................232
c. Informal Complaints............................................................................................241
d. Formal Complaints ..............................................................................................241
e. Remedies and Sanctions ......................................................................................275
IV. FURTHER NOTICE OF PROPOSED RULEMAKING......................................................279
A. Small Entity Exemption ..................................................................................................279
2

Federal Communications Commission

FCC 11-151

B. Section 718 Implementation............................................................................................292
C. Interoperable Video Conferencing Services....................................................................301
1. Meaning of Interoperable ..........................................................................................301
2. Coverage of Video Mail ............................................................................................306
D. Accessibility of Information Content ..............................................................................308
E. Electronically Mediated Services ....................................................................................309
F. Performance Objectives...................................................................................................310
G. Safe Harbors ....................................................................................................................311
H. Section 718 Recordkeeping and Enforcement.................................................................315
V. PROCEDURAL MATTERS.................................................................................................318
A. Ex Parte Rules Permit-But-Disclose ............................................................................318
B. Comment Filing Procedures ............................................................................................319
C. Final Regulatory Flexibility Analysis .............................................................................321
D. Final Paperwork Reduction Analysis ..............................................................................322
E. Initial Regulatory Flexibility Analysis ............................................................................324
F. Initial Paperwork Reduction Analysis.............................................................................325
G. Further Information .........................................................................................................326
VI. ORDERING CLAUSES........................................................................................................327
APPENDIX A - List of Commenters
APPENDIX B - Final Rules
APPENDIX C - Proposed Rules
APPENDIX D - Final Regulatory Flexibility Analysis
APPENDIX E - Initial Regulatory Flexibility Analysis
APPENDIX F - Accessibility of Information Content
APPENDIX G - Performance Objectives

I.

INTRODUCTION AND BACKGROUND

1.
In this Report and Order, we implement provisions of Section 104 of the
"Twenty-First Century Communications and Video Accessibility Act of 2010"1
(hereinafter referred to as the "CVAA"), which was enacted to ensure that people with
disabilities have access to the incredible and innovative communications technologies of
the 21st-century. These rules are significant and necessary steps towards ensuring that the
54 million Americans with disabilities2 are able to fully utilize and benefit from advanced


1 Twenty-First Century Communications and Video Accessibility Act of 2010, Pub. L. No. 111-260, 124
Stat. 2751 (2010) (as codified in various sections of 47 U.S.C.) (CVAA). The law was enacted on October
8, 2010. See also Amendment of Twenty-First Century Communications and Video Accessibility Act of
2010, Pub. L. No. 111-265, 124 Stat. 2795 (2010), also enacted on October 8, 2010, to make technical
corrections to the Twenty-First Century Communications and Video Accessibility Act of 2010 and the
amendments made by that Act. Hereinafter, all references to the CVAA will be to the CVAA as codified in
the Communications Act of 1934, as amended, unless otherwise indicated.
2 Matthew W. Brault, Current Population Reports 3, Americans with Disabilities: 2005, (Dec. 2008) ("2005
Census Report"), http://www.census.gov/prod/2008pubs/p70-117.pdf.
3

Federal Communications Commission

FCC 11-151

communications services ("ACS"). Given the fundamental role ACS plays in our
everyday lives, we believe that the CVAA represents the most significant accessibility
legislation since the passage of the Americans with Disabilities Act ("ADA") in 1990.3
2.
In enacting the CVAA, Congress noted that the communications
marketplace had undergone a "fundamental transformation" since it last acted on these
issues in 1996, when it added Section 255 to the Communications Act of 1934, as
amended (hereinafter referred to as "the Communications Act" or "the Act").4 For
example, statistics show that as of 2010, "40% of adults use the Internet, e-mail or instant
messaging on a mobile phone."5 Congress found, however, that people with disabilities
often have not shared in the benefits of this rapid technological advancement.6
Implementation of the CVAA is a critical step in addressing this inequity.
3.
The actions we take today are consistent with the Commission's
commitment to rapid deployment of and universal access to broadband services for all
Americans. As described in the National Broadband Plan, broadband technology can
stimulate economic growth and provide opportunity for all Americans.7 Only 41% of
Americans with disabilities, however, have broadband access at home compared to the
national average of 69%.8 Congress recognized that this gap must be closed in order to
afford persons with disabilities to share fully in the economic, social, and civic benefits of
broadband.
4.
In keeping with Congress's clear direction, our actions today advance the
accessibility of ACS in a manner that is consistent with our objectives of promoting
investment and innovation, while being mindful of the potential burden on industry. We
have crafted our rules to provide manufacturers and service providers flexibility in how
they achieve accessibility. Our rules encourage efficient accessibility solutions and do


3 Americans with Disabilities Act of 1990, Pub. L. No. 101-336, 104 Stat. 327 (1990) (codified at 42
U.S.C. 12101-12213) (ADA).
4 See 47 U.S.C. 255; S. Rep. No. 111386, at 1 (2010) ("Senate Report"); H.R. Rep. No. 111-563, at 19
(2010) ("House Report").
5 Aaron Smith, Pew Internet, Mobile Access 2010, (July 7, 2010), available at
http://www.pewinternet.org/Reports/2010/Mobile-Access-2010.aspx. The Pew Report states that "40% of
adults use the Internet, e-mail or instant messaging on a mobile phone (up from the 32% of Americans who
did this in 2009)" and that "mobile data applications have grown more popular over the last year." Id. The
report shows that the usage of "non-voice data applications" has grown dramatically in the last year as the
percentages have risen for people who use their phones for such things, among others, as checking the
Internet, taking pictures, and sending text messages, instant messages, and e-mail and also states, "[o]f the
eight mobile data applications we asked about in both 2009 and 2010, all showed statistically significant
year-to-year growth." Id.
6 See Senate Report at 1-2; House Report at 19.
7 Federal Communications Commission, Connecting America: The National Broadband Plan at
Recommendation 9.10. (rel. Mar. 16, 2010) ("National Broadband Plan" or "NBP"), available at
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-296935A1.pdf.
8 Susannah Fox, Pew Internet, Americans Living with Disability and their Technology Profile (January 21,
2011), available at http://pewinternet.org/Reports/2011/Disability.aspx.
4

Federal Communications Commission

FCC 11-151

not require the retrofitting of equipment or services. Further, our rules will phase in over
two years, balancing the potentially significant industry-wide changes the law requires
with the need to ensure that people with disabilities can take advantage of the benefits of
ACS.
5.
Today, we specifically take action to implement Sections 716, 717, and
718 of the Act. Section 716 requires that providers of ACS and manufacturers of
equipment used for ACS make their services and products accessible to people with
disabilities, unless it is not achievable to do so.9 The CVAA provides flexibility to
providers of ACS and manufacturers of ACS equipment by allowing covered entities to
comply with Section 716 by either building accessibility features into their equipment or
services10 or relying on third-party applications, peripheral devices, software, hardware,
or customer premises equipment ("CPE") that are available to individuals with
disabilities at nominal cost.11 Section 716 grants the Commission the authority to waive
the requirements of this section for equipment and services that provide access to ACS
but are designed primarily for purposes other than using ACS and to exempt small
entities from the requirements of the section.12 Finally, Section 716 provides that the
requirements of the section do not apply to customized equipment or services not offered
directly to the public or to such classes of users as to effectively be made available to the
public.13
6.
Section 717 of the Act requires that the Commission establish new
recordkeeping and enforcement procedures for manufacturers and providers that are
subject to Section 255 and Section 716.14 It provides that covered entities submit to the
Commission an annual certification that records are kept in accordance with the
requirements of the section.15 Every two years after enactment of the CVAA, the
Commission is required to file a report to Congress including an assessment of
compliance with Sections 255, 716, and 718; the extent of persistent barriers to
accessibility with respect to new communications technologies; and a summary of
complaints handled, along with their resolutions, over the preceding two years.16 Section
717 also compels the Comptroller General to conduct a study on the Commission's
enforcement actions, as well as the extent to which the sections' requirements have
affected the development of new technologies, within five years of enactment of the


9 See 47 U.S.C. 617(a)(1) and (b)(1).
10 See 47 U.S.C. 617(a)(2)(A) and (b)(2)(A).
11 See 47 U.S.C. 617(a)(2)(B) and (b)(2)(B).
12 47 U.S.C. 617(h)(1)-(2).
13 47 U.S.C. 617(i).
14 See 47 U.S.C. 618(a). The Section 717 requirements also apply to manufacturers and providers subject
to Section 718, which provides for the accessibility of mobile phone browsers and is effective three years
after enactment of the CVAA. See Section 717 Recordkeeping and Enforcement, Section III.E, infra.
15 47 U.S.C. 618(a)(5)(B).
16 47 U.S.C. 618(b).
5

Federal Communications Commission

FCC 11-151

CVAA.17 Finally, Section 717 requires the creation of a clearinghouse for information
about the accessibility of products, services, and accessibility solutions and requires the
Commission, in coordination with NTIA, to develop an information and educational
program to inform the public about the clearinghouse and the protections and remedies in
Sections 255, 716, and 718.18
7.
Section 718, which is effective three years after the date of enactment of
the CVAA, requires manufacturers and service providers to make Internet browsers built
into mobile phones accessible to and useable by people who are blind or have visual
impairments, unless doing so is not achievable.19 Section 718 makes clear that this
obligation does not include a requirement to make Internet content, applications, or
services accessible to or usable by individuals with disabilities.20 Section 718 also
provides flexibility for manufacturers or providers to comply with this section by either
building accessibility features into their equipment or services or relying on third-party
applications, peripheral devices, software, hardware, or CPE.21 Finally, Section 718
amends Section 503 of the Act to provide forfeiture penalties for manufacturers or
providers who violate Sections 255, 716, or 718.22
8.
Procedural history. On October 21, 2010, the Consumer and
Governmental Affairs Bureau ("CGB") and the Wireless Telecommunications Bureau
("WTB") jointly issued a Public Notice ("October Public Notice") seeking input on key
provisions in Sections 716, 717, and 718 of the Communications Act, as amended by the
CVAA.23
9.
In March 2011, the Commission issued a Notice of Proposed Rulemaking,
proposing new accessibility requirements to implement Sections 716 and 717 of the
Act.24 In the Accessibility NPRM, the Commission proposed that the accessibility
requirements of Section 716 generally should apply to a wide range of manufacturers and
service providers, including applications developers and providers of applications or
services downloaded and run by users over service providers' networks.25 The


17 47 U.S.C. 618(c).
18 47 U.S.C. 618(d), (e).
19 See 47 U.S.C. 619.
20 47 U.S.C. 619(a)(1)-(2).
21 47 U.S.C. 619(b).
22 47 U.S.C. 619(c).
23 See Consumer and Governmental Affairs Bureau and Wireless Telecommunications Bureau Seek
Comment on Advanced Communication Provisions of the Twenty-First Century Communications and Video
Accessibility Act of 2010
, CG Docket No. 10-213, DA 10-2029, Public Notice, at 2, released October 21,
2010 ("October Public Notice").
24 Implementation of Sections 716 and 717 of the Communications Act of 1934, as Enacted by the Twenty-
First Century Communications and Video Accessibility Act of 2010
, CG Docket No. 10-213, Notice of
Proposed Rulemaking, 26 FCC Rcd 3133, 3142, 16 (2011) (Accessibility NPRM).
25 Accessibility NPRM, 26 FCC Rcd at 3142-3151, 19-47.
6

Federal Communications Commission

FCC 11-151

Commission also sought comment on whether and how it should exercise its authority to
adopt exemptions for small entities26 and waivers, both individual and blanket, for
offerings that are designed primarily for purposes other than using advanced
communications services.27
10.
The Commission proposed, in the Accessibility NPRM, to define
"achievable," consistent with the statutory language, as "with reasonable effort and
expense"28 and proposed to adopt the four statutory factors that could be used to conduct
an achievability analysis pursuant to Section 716.29 The Commission also sought
comment on whether it should base some of its definitions on the United States Access
Board ("Access Board")30 guidelines and the existing Section 255 rules. Section 255(e)
of the Act, as amended, directs the Access Board to develop equipment accessibility
guidelines "in conjunction with" the Commission, and periodically to review and update
those guidelines.31 In accordance with this directive, in March 2010, the Access Board
released Draft Guidelines for public comment.32 Although a number of the issues
discussed in the instant proceeding overlap with the guidelines now under consideration
by the Access Board, the Access Board's process for developing guidelines is still not
complete.
11.
In addition, the Commission proposed to adopt the Act's flexibility to
allow manufacturers and service providers to comply with the requirements of Section
716 either by building accessibility features into their equipment or service or by relying


26 Accessibility NPRM, 26 FCC Rcd at 3157-58, 66.
27 Accessibility NPRM, 26 FCC Rcd at 3153-56, 52-60.
28 Accessibility NPRM, 26 FCC Rcd at 3158-59, 67-69.
29 The Commission proposed to consider the following four factors equally to make achievability
determinations: 1) the nature and cost of the steps needed to meet the requirements of this section with
respect to the specific equipment or service in question; 2) the technical and economic impact on the
operation of the manufacturer or provider and on the operation of the specific equipment or service in
question; 3) the type of operations of the manufacturer or provider; and 4) the extent to which the service
provider or manufacturer in question offers accessible services or equipment containing varying degrees of
functionality and features, and offered at differing price points. Accessibility NPRM, 26 FCC Rcd at 3158-
3162, 68-76.
30 The U.S. Access Board is "an independent Federal agency devoted to accessibility for people with
disabilities [which] . . . develops and maintains design criteria for the built environment, transit vehicles,
telecommunications equipment, and for electronic and information technology." United States Access
Board, About the U.S. Access Board, http://www.access-board.gov/about.htm (last visited February 18,
2011).
31 47 U.S.C. 255(e). See Implementation of Sections 255 and 251(a)(2) of the Communications Act of
1934
, as enacted by the Telecommunications Act of 1996, WT Docket No. 96-198, Report and Order and
Further Notice of Inquiry, 16 FCC Rcd 6417 (1999) ("Section 255 Report and Order").
32 Accessibility NPRM, 26 FCC Rcd at 3164-3165, 82-83. See also United States Access Board, Draft
Information and Communication Technology (ICT) Standards and Guidelines
, (March 2010), ("Access
Board Draft Guidelines"), http://www.access-board.gov/sec508/refresh/draft-rule.pdf.
7

Federal Communications Commission

FCC 11-151

on third-party applications or other accessibility solutions.33 The Commission also
proposed, consistent with the Act, to require that manufacturers and service providers
make their products compatible with specialized devices commonly used by people with
disabilities, when it is not achievable for manufacturers and service providers to make
their products accessible to people with disabilities.34
12.
To enforce the provisions of Sections 255, 716, 717, and 718, the
Commission proposed procedures in the Accessibility NPRM to facilitate the filing of
complaints,35 including implementing the Congressional 180-day deadline to issue an
order resolving informal complaints concerning the accessibility of products.36 If the
Commission fails to act on a complaint as prescribed in Section 717, the complainant
may file for mandamus in the U.S. Court of Appeals for the District of Columbia to
compel the Commission to carry out its responsibility under the section.37 In addition, the
Commission proposed that manufacturers and providers subject to Sections 716, 718, and
Section 255 maintain records of (1) their efforts to consult with people with disabilities;
(2) the accessibility features of their products; and (3) the compatibility of their products
with specialized devices, consistent with the Act. The Commission also sought comment
on whether it should require entities to maintain other records to demonstrate their
compliance with these provisions and sought input on a "reasonable time period" during
which covered entities would be required to maintain these records.38 Finally, in the
Accessibility NPRM, the Commission sought input on steps the Commission and
stakeholders could take to ensure that manufacturers and service providers could meet
their obligations pursuant to Section 718 by 2013.

II.

EXECUTIVE SUMMARY

13.
In this Report and Order, we conclude that the accessibility requirements
of Section 716 of the Act apply to non-interconnected VoIP services, electronic
messaging services, and interoperable video conferencing services. We implement rules
that hold entities that make or produce end user equipment, including tablets, laptops, and
smartphones, responsible for the accessibility of the hardware and manufacturer-provided
software used for e-mail, SMS text messaging, and other ACS. We also hold these
entities responsible for software upgrades made available by such manufacturers for
download by users. Additionally, we conclude that, except for third-party accessibility
solutions, there is no liability for a manufacturer of end user equipment for the
accessibility of software that is independently selected and installed by the user, or that
the user chooses to use in the cloud. We provide the flexibility to build-in accessibility or
to use third-party solutions, if solutions are available at nominal cost (including set up


33 See Accessibility NPRM, 26 FCC Rcd at 3136-70, 4, 77-80, 100.
34 Accessibility NPRM, 26 FCC Rcd at 3165-67, 85-90, 3170 100.
35 Accessibility NPRM, 26 FCC Rcd at 3180-83, 126-133.
36 Accessibility NPRM, 26 FCC Rcd at 3183-85, 136-139.
37 47 U.S.C. 618(a)(6).
38 Accessibility NPRM, 26 FCC Rcd at 3176-78, 117, 121.
8

Federal Communications Commission

FCC 11-151

and maintenance) to the consumer. We require covered entities choosing to use third-
party accessibility solutions to support those solutions for the life of the ACS product or
service or for a period of up to two years after the third-party solution is discontinued,
whichever comes first. If the third-party solution is discontinued, however, another third-
party accessibility solution must be made available by the covered entity at nominal cost
to the consumer. If accessibility is not achievable either by building it in or by using
third-party accessibility solutions, equipment or services must be compatible with
existing peripheral devices or specialized customer premises equipment commonly used
by individuals with disabilities to achieve access, unless such compatibility is not
achievable.
14.
We also conclude that providers of advanced communications services
include all entities that offer advanced communications services in or affecting interstate
commerce, including resellers and aggregators. Such providers include entities that
provide advanced communications services over their own networks, as well as providers
of applications or services accessed (i.e., downloaded and run) by users over other service
providers' networks. Consistent with our approach for manufacturers of equipment, we
find that a provider of advanced communications services is responsible for the
accessibility of the underlying components of its service, including software applications,
to the extent that doing so is achievable. A provider will not be responsible for the
accessibility of components that it does not provide, except when the provider relies on a
third-party solution to comply with its accessibility obligations.
15.
We adopt rules identifying the four statutory factors that will be used to
conduct an achievability analysis pursuant to Section 716: (i) the nature and cost of the
steps needed to meet the requirements of Section 716 of the Act and this part with respect
to the specific equipment or service in question; (ii) the technical and economic impact
on the operation of the manufacturer or provider and on the operation of the specific
equipment or service in question, including on the development and deployment of new
communications technologies; (iii) the type of operations of the manufacturer or
provider; and (iv) the extent to which the service provider or manufacturer in question
offers accessible services or equipment containing varying degrees of functionality and
features, and offered at differing price points. Pursuant to the fourth achievability factor,
we conclude that covered entities do not have to consider what is achievable with respect
to every product, if such entity offers consumers with the full range of disabilities
products with varied functions, features, and prices. We also conclude that ACS
providers have a duty not to install network features, functions, or capabilities that
impede accessibility or usability.
16.
We adopt rules pursuant to Section 716(h)(1) to accommodate requests to
waive the requirements of Section 716 for ACS and ACS equipment. We conclude that
we will grant waivers on a case-by-case basis and adopt two factors for determining the
primary purpose for which equipment or a service is designed. We will consider whether
the equipment or service is capable of accessing ACS and whether it was designed for
multiple purposes but primarily for purposes other than using ACS. In determining
whether the equipment or service is designed primarily for purposes other than using
ACS, the Commission shall consider the following factors: (i) whether the product was
9

Federal Communications Commission

FCC 11-151

designed to be used for ACS purposes by the general public; and (ii) whether the
equipment or services are marketed for the ACS features and functions.
17.
Our new accessibility rules further provide that we may also waive, on our
own motion or in response to a petition, the requirements of Section 716 for classes of
services and equipment that meet the above statutory requirements and waiver criteria.
To be deemed a class, members of a class must have the same kind of equipment or
service and same kind of ACS features and functions.
18.
We further conclude that the Commission has the discretion to place time
limits on waivers. The waiver will generally be good for the life of the product or service
model or version. However, if substantial upgrades are made to the product that may
change the nature of the product or service, a new waiver request must be filed. Parties
filing class waiver requests must explain in detail the expected lifecycle for the
equipment or services that are part of the class. All products and services covered by a
class waiver that are introduced into the market while the waiver is in effect will
ordinarily be subject to the waiver for the duration of the life of those particular products
and services. For products and services already under development at the time when a
class waiver expires, the achievability analysis conducted may take into consideration the
developmental stage of the product and the effort and expense needed to achieve
accessibility at that point in the developmental stage. To the extent a class waiver
petitioner seeks a waiver for multiple generations of similar equipment and services, we
will examine the justification for the waiver extending through the lifecycle of each
discrete generation.
19.
We adopt a timeline for consideration of waiver requests similar to the
Commission's timeline for consideration of applications for transfers or assignments of
licenses or authorizations relating to complex mergers. We delegate to the Consumer and
Governmental Affairs Bureau the authority to act upon all waiver requests, and urge the
Bureau to act promptly with the goal of completing action on each waiver request within
180 days of public notice. In addition, we require that all public notices of waiver
requests provide a minimum 30-day comment period. Finally, we note that these public
notices will be posted and highlighted on a webpage designated for disability-related
information in the Disability Rights Office section of the Commission's website.
20.
The Commission has already received requests for class waivers for
gaming equipment, services, and software, and TVs and Digital Video Players ("DVPs")
enabled for use with the Internet. While we conclude that the record is insufficient to
grant waivers for gaming and IP-enabled TVs and DVPs, parties may re-file requests
consistent with the new waiver rules.
21.
We construe Section 716(i) of the Act to provide a narrow exemption from
the accessibility requirements of Section 716. Specifically, we conclude that equipment
that is customized for the unique needs of a particular entity, and that is not offered
directly to the public, is exempt from Section 716. We conclude that this narrow
exemption should be limited in scope to customized equipment and services offered to
business and other enterprise customers only. We also conclude that equipment
manufactured for the unique needs of public safety entities falls within this narrow
exemption.
10

Federal Communications Commission

FCC 11-151

22.
We find that the record does not contain sufficient support to adopt a
permanent exemption for small entities. Nonetheless, we believe that relief is necessary
for small entities that may lack the legal, technical, or financial ability to conduct an
achievability analysis or comply with the recordkeeping and certification requirements
under these rules. Therefore, we adopt a temporary exemption for ACS providers and
ACS equipment manufacturers that qualify as small business concerns under the Small
Business Administration's rules and small business size standards. The temporary
exemption will expire on the earlier of (1) the effective date of small entity exemption
rules adopted pursuant to the Further Notice of Proposed Rulemaking, or (2) October 8,
2013.
23.
We adopt as general performance objectives the requirements that covered
equipment and services be accessible, compatible, and usable. We defer consideration of
more specific performance objectives to ensure the accessibility, usability, and
compatibility of ACS and ACS equipment until the Access Board adopts Final
Guidelines39 and the Emergency Access Advisory Committee (EAAC)40 provides
recommendations to the Commission relating to the migration to IP-enabled networks.
Additionally, consistent with the views of the majority of the commenters, we refrain
from adopting any technical standards as safe harbors for covered entities. To facilitate
the ability of covered entities to implement accessibility features early in product
development cycles, we gradually phase in compliance requirements for accessibility,
with full compliance required by October 8, 2013.
24.
We also adopt new recordkeeping rules that provide clear guidance to
covered entities on the records they must keep to demonstrate compliance with our new
rules. We require covered entities to keep the three categories of records set forth in
Section 717(a)(5)(A).41 We remind covered entities that do not make their products or
services accessible and claim as a defense that it is not achievable for them to do so, that
they bear the burden of proof on this defense.
25.
In an effort to encourage settlements, we adopt a requirement that
consumers must file a "Request for Dispute Assistance" with the Consumer and
Governmental Affairs' Disability Rights Office as a prerequisite to filing an informal
complaint with the Enforcement Bureau. We also establish minimum requirements for
information that must be contained in an informal complaint. While we also adopt
formal complaint procedures, we decline to require complainants to file informal
complaints prior to filing formal complaints.
26.
In the accompanying Further Notice of Proposed Rulemaking ("Further
Notice"), we seek comment on whether to adopt a permanent exemption for small entities
and, if so, whether it should be based on the temporary exemption or some other criteria.


39 See discussion supra para. 10. See also Access Board Draft Guidelines.
40 The EAAC was established pursuant to Section 106 of the CVAA for the purpose of achieving equal
access to emergency services by individuals with disabilities, as part of the migration to a national Internet
Protocol-enabled emergency network. Pub. L. No. 111-260, 106.
4147 U.S.C. 618(a)(5)(A)(i)-(iii).
11

Federal Communications Commission

FCC 11-151

We seek comment on the impact of a permanent exemption on providers of ACS and
manufacturers of ACS equipment, including the compliance costs for small entities
absent a permanent exemption. We also seek comment on the impact of a permanent
exemption on consumers, including on the availability of accessible ACS and ACS
equipment and on the accessibility of new ACS innovations or ACS equipment
innovations. We propose to continually monitor the impact of any small entity
exemption, including whether it promotes innovation or whether it has unanticipated
negative consequences on the accessibility of ACS.
27.
We propose to clarify that Internet browsers are software generally subject
to the requirements of Section 716, with the exception of the discrete category of Internet
browsers built into mobile phones used by individuals who are blind or have a visual
impairment, which Congress singled out for particular treatment in Section 718. We seek
to further develop the record on the technical challenges associated with ensuring that
Internet browsers built into mobile phones and those browsers incorporated into
computers, laptops, tablets, and devices other than mobile phones are accessible to and
usable by persons with disabilities.
28.
With regard to Section 718, which is not effective until 2013, we seek
comment on the best way(s) to implement Section 718 so as to afford affected
manufacturers and service providers the opportunity to provide input at the outset, as well
as to make the necessary arrangements to achieve compliance at such time as the
provisions of Section 718 become effective.
29.
To ensure that we capture all the equipment Congress intended to fall
within the scope of Section 716, we seek comment on alternative proposed definitions of
"interoperable" as used in the term "interoperable video conferencing." Additionally, we
ask whether we should require that video mail service be accessible to individuals with
disabilities when provided along with a video conferencing service. We seek to further
develop the record regarding specific activities that impair or impede the accessibility of
information content. We also seek comment on whether performance objectives should
include certain testable criteria. In addition, we seek comment on whether certain safe
harbor technical standards will allow the various components in the ACS architecture to
work together more efficiently, thereby facilitating accessibility. We also seek comment
on the definition of "electronically mediated services," the extent to which electronically
mediated services are covered under Section 716, and how they can be used to transform
ACS into an accessible form.

III.

REPORT AND ORDER

A.

Scope and Obligations

1.

Advanced Communications Services

a.

General

30.
Background. Section 3(1) of the Act defines "advanced communications
services" to mean (A) interconnected VoIP service; (B) non-interconnected VoIP service;
12

Federal Communications Commission

FCC 11-151

(C) electronic messaging service; and (D) interoperable video conferencing service.42
Section 3 of the Act also sets forth definitions for each of these terms.43 In the
Accessibility NPRM, the Commission proposed to treat any offering that meets the
criteria of the statutory definitions as an "advanced communications service."44
31.
Discussion. We will adopt into our rules the statutory definition of
"advanced communications services." We thus agree with commenters that urge us to
include all offerings of services that meet the statutory definitions as being within the
scope of our rules.45 In doing so, we maintain the balance that Congress achieved in the
CVAA between promoting accessibility through a broadly defined scope of covered
services and equipment and ensuring industry flexibility and innovation through other
provisions of the Act, including limitations on liability, waivers, and exemptions.46
32.
Some commenters asserted that the Commission should exclude from the
definition of advanced communications services such services that are "incidental"
components of a product.47 We reject this view. Were the Commission to adopt that
approach, it would be rendering superfluous Section 716's waiver provision, which
allows the Commission to waive its requirements for services or equipment "designed
primarily for purposes other than using advanced communications service."48 Several
parties also ask the Commission to read into the statutory definition of advanced
communications services the phrase "offered to the public." They argue that we should
exclude from our definition advanced communications services those services that are
provided on an "incidental" basis because such services are not affirmatively "offered"
by the provider or equipment.49 There is nothing in the statute or the legislative history
that supports this narrow reading. Section 3(1) of the Act clearly states that the


42 See 47 U.S.C. 153(1).
43 See 47 U.S.C. 153(19), (25), (27), (36).
44 Accessibility NPRM, 26 FCC Rcd at 3145-6, 3150, 32, 43.
45 See IT and Telecom RERCs Comments at 9 and 13. See also ACB Reply Comments at 17-19; AFB
Reply Comments at 7. But see TIA Comments at 8; T-Mobile Comments at 3.
46 See, e.g., Pub. L. No. 111-260, 2 (limitation on liability); 47 U.S.C. 617(h)(1) (provision for
waivers); 617(h)(2) (provision for exempting small entities); 617(i) (exempting customized equipment and
services).
47 See, e.g., CEA Comments at 10, 12, and 14; CTIA Comments at 19 and 21; ESA Comments at 3; ITI
Comments at 23; OnStar Comments at 6; TIA Comments at 9 and 12; Verizon Comments at 6-7. CEA also
suggests that excluding "incidental" non-interconnected VoIP services by definition, rather than by using a
waiver process, would also result in the exclusion of these "incidental" services being subject to
Telecommunications Relay Service Fund ("TRS Fund") contributions and FCC Form 499-A filing
requirements. CEA Comments at 12-13. See also Contributions to the TRS Fund, Notice of Proposed
Rulemaking, CG Docket No. 11-47, 26 FCC Rcd 3285 (2011). Any definition adopted in this proceeding
does not necessarily determine the outcome in other proceedings.
48 See 47 U.S.C. 617(h)(1). See also Waivers for Services or Equipment Designed Primarily for Purposes
other than Using ACS, Section III.C.2, infra.
49 See, e.g., CEA Comments at 10-11 and 14; T-Mobile Comments at 6; Verizon Comments at 7-8, citing,
inter alia,
47 U.S.C. 617(a) and (b).
13

Federal Communications Commission

FCC 11-151

enumerated services are themselves "advanced communications services" when
provided, and does not limit the definition to the particular marketing focus of the
manufacturers or service providers.50
b.

Interconnected VoIP Service

33.
Background. Section 3(25) of the Act, as added by the CVAA, provides
that the term "interconnected VoIP service" has the meaning given in section 9.3 of the
Commission's rules, as such section may be amended from time to time.51 Section 9.3, in
turn, defines interconnected VoIP as a service that (1) enables real-time, two-way voice
communications; (2) requires a broadband connection from the user's location; (3)
requires Internet protocol-compatible customer premises equipment ("CPE"); and (4)
permits users generally to receive calls that originate on the public switched telephone
network ("PSTN") and to terminate calls to the PSTN.52 In the Accessibility NPRM, the
Commission proposed to continue to define interconnected VoIP in accordance with
section 9.3 of the Commission's rules and sought comment on that proposal.53
34.
In addition, Section 716(f) of the Act provides that "the requirements of
this section shall not apply to any equipment or services, including interconnected VoIP
service, that are subject to the requirements of Section 255 on the day before the date of
enactment of the Twenty-First Century Communications and Video Accessibility Act of
2010,"54 that is, on October 7, 2010. In the Accessibility NPRM, the Commission sought
comment on AT&T's suggestion that "the Commission should subject multipurpose
devices to Section 255 to the extent that the device provides a service that is already
subject to Section 255 and apply Section 716 solely to the extent that the device provides
ACS that is not otherwise subject to Section 255."55 The Commission also sought
comment on alternative interpretations of Section 716(f).


50 See 47 U.S.C. 153(1). We also reject TIA's recommendation that "advanced communications services"
be limited to "human-to-human" services. See Letter from Mark Uncapher, Director, Regulatory and
Government Affairs, Telecommunications Industry Association, to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 2 (filed Sept. 28, 2011) ("TIA Sept. 28 Ex Parte"). We note that, while Congress
did not indicate that "advanced communications services" must be "human-to-human," Congress defined,
in part, "interconnected VoIP service" as a service that "enables real-time, two-way voice communications"
(see para. 32, infra), "non-interconnected VoIP service" as a service that "enables real-time voice
communications" (see para. 39, infra), "electronic messaging service" as a service that "provides real-time
or near real-time non-voice messages in text form between individuals" (see para. 41, infra), and
"interoperable video conferencing services" as a service that "provides real-time video communications"
(see para. 45, infra), and our rules adopt those definitions.
51 47 U.S.C. 153(25); 47 C.F.R. 9.3.
52 47 C.F.R. 9.3.
53 Accessibility NPRM, 26 FCC Rcd at 3145, 29.
54 See 47 U.S.C. 617(f).
55 Accessibility NPRM, 26 FCC Rcd at 3145, 29, citing AT&T Comments in response to October Public
Notice
at 5.
14

Federal Communications Commission

FCC 11-151

35.
Discussion. As urged by commenters,56 we adopt the definition of
"interconnected VoIP service" as having the same meaning as in section 9.3 of the
Commission's rules, as such section may be amended from time to time.57 Given that this
definition has broad reaching applicability beyond this proceeding,58 we find that any
changes59 to this definition should be undertaken in a proceeding that considers the
broader context and effects of any such change.
36.
We confirm that Section 716(f) means that Section 255, and not Section
716, applies to telecommunications and interconnected VoIP services and equipment
offered as of October 7, 2010.60 Our proposed rule read, in part, that "the requirements of
this part shall not apply to any equipment or services . . . that were subject to the
requirements of Section 255 of the Act on October 7, 2010."61 We decline to amend our
proposed rule by substituting the word "were" with the word "are," as urged by NCTA.62
The statute makes clear that any equipment or service that was subject to Section 255 on
October 7, 2010, should continue to be subject to Section 255, regardless of whether that
equipment or service was offered before or after October 7, 2010. With respect to a new
service (and equipment used for that service) that was not in existence on October 7,
2010, we believe we have the authority to classify the service as a service subject to
either Section 255 or Section 716 (or neither). In addition, Congress anticipated that the
definition of interconnected VoIP service may change over time.63 In that event, it is
possible, for example, that certain non-interconnected VoIP services that are currently


56 See, e.g., CEA Comments at 9; TIA Comments at 8; Verizon Comments at 5-6.
57 47 U.S.C. 153(25); 47 C.F.R. 9.3.
58 See, e.g., Contributions to the Telecommunications Relay Services Fund, CG Docket No. 11-47, FCC 11-
38, Notice of Proposed Rulemaking, 26 FCC Rcd. 3285, 3291 13-14 (2011); Rules and Regulations
Implementing the Truth in Caller ID Act of 2009
, WC Docket No. 11-39, FCC 11-41, Notice of Proposed
Rulemaking, 26 FCC Rcd 4128, 4134, 15 (2011); Telecommunications Relay Services and Speech-to-
Speech Services for Individuals with Hearing and Speech Disabilities; E911 Requirements for IP-Enabled
Service Providers
, CG Docket No. 03-123 and WC Docket No. 05-196, FCC 08-78, Report and Order, 23
FCC Rcd. 5255, 5257, 5268, 22, 27 (2008); Implementation of Sections 255 and 251(a)(2) of the
Telecommunications Act of 1996: Access to Telecommunications Services, Telecommunications Equipment
and Consumer Premises Equipment by Persons with Disabilities
, WT Docket No. 96-98, Order and Notice
of Proposed Rulemaking, 22 FCC Rcd 11275, 11280-90, 7-24 (2007); IP-Enabled Service Providers,
WC Docket No. 04-36, FCC 05-116, First Report and Order and Notice of Proposed Rulemaking, 20 FCC
Rcd 10245, 22-28 (2005).
59 See IT and Telecom RERCs Comments at 7 (urging us to amend the definition in section 9.3 of the
Commission's rules to delete the word "generally" and to include "successors to the PSTN").
60 See 47 U.S.C. 617(f). See, e.g., CEA Comments at 9; NCTA Comments at 3 and 6-8; TechAmerica
Comments at 3; T-Mobile Comments at 5-6; TWC Comments 8-9; Verizon Comments at 5-6. But see
Words+ and Compusult Comments at 12 (substantial updates and wholly new interconnected VoIP services
and equipment, after October 7, 2010, must comply with Section 716).
61 See Accessibility NPRM, 26 FCC Rcd at 3193, Appendix B.
62 See NCTA Comments at 7-8.
63 See 47 U.S.C. 153(25).
15

Federal Communications Commission

FCC 11-151

subject to Section 716 may meet a future definition of interconnected VoIP services and
yet remain subject to Section 716.
37.
With respect to multipurpose devices, including devices used for both
telecommunications and advanced communications services, we agree with the vast
majority of commenters that argued that Section 255 applies to telecommunications
services and to services classified as interconnected VoIP as of October 7, 2010, as well
as to equipment components used for those services, and Section 716 applies to non-
interconnected VoIP, electronic messaging, and interoperable video conferencing
services, as well as equipment components used for those services.64 We reject the
suggestion of some commenters that such multipurpose devices should be governed
exclusively by Section 255.65 Nothing in the statute or legislative history indicates that
Congress sought to exclude from the requirements of Section 716 a device used for
advanced communications merely because it also has telecommunications or
interconnected VoIP capability. Rather, both the House Report and the Senate Report
state that smartphones represent a technology that Americans rely on daily and, at the
same time, a technological advance that is often still not accessible to individuals with
disabilities.66 If multipurpose devices such as smartphones were subject exclusively to
Section 255, then the advanced communications services components of smartphones,
which are not subject to Section 255, would not be covered by Section 716. That is, there
would be no requirement to make the advanced communications services components of
multipurpose devices such as smartphones accessible to people with disabilities. Such an
approach would, therefore, undermine the very purpose of the CVAA.67
38.
Due to the large number of multipurpose devices, including smartphones,
tablets, laptops and desktops, that are on the market, if Section 716(f) were interpreted to
mean that Section 716 applies only to equipment that is used exclusively for advanced
communications services,68 and that Section 255 applies only to equipment that is used
exclusively for telecommunications and interconnected VoIP services,69 almost no
devices would be covered by Section 716 and only stand-alone telephones and VoIP
phones would be covered by Section 255. That reading would undercut Congress's clear
aim in enacting the CVAA.70 We also disagree with commenters that suggest that such


64 See, e.g., AT&T Comments at 4; CEA Comments at 9-10; IT and Telecom RERCs Comments at 7-8; T-
Mobile Comments at 5-6; Verizon Comments at 5-6. See also CEA Reply Comments at 5-6.
65 See CTIA Comments at 13; NCTA Comments at 3, 9.

66 House Report at 19; Senate Report at 1-2.
67 See Words+ and Compusult Comments at 12 (exclusive coverage under Section 255 would undermine
virtually all accessibility benefit to be gained by the CVAA).
68 See ESA Comments at 3 (application of CVAA requirements should be limited only to "equipment used
for advanced communications services," not other purposes); NCTA Comments at 7 (suggesting that
Section 716 applies to equipment used only for advanced communications services).
69 See AFB Comments at 6.
70 Such a result is also contrary to how Section 255 is currently applied to multipurpose equipment and
services. Under Commission rules implementing Section 255, "multipurpose equipment . . . is covered by
Section 255 only to the extent that it provides a telecommunications function" and not "to all functions . . .
(continued....)
16

Federal Communications Commission

FCC 11-151

multipurpose devices should be governed exclusively by Section 716.71 Such an
interpretation would render Section 716(f) meaningless.
39.
We recognize that the application of Section 255 and Section 716 to such
multipurpose devices means that manufacturers and service providers may be subject to
two distinct requirements, but as discussed above, we believe any other interpretation
would be inconsistent with Congressional intent. As a practical matter, we note that the
nature of the service or equipment that is the subject of a complaint depending on the
type of communications involved will determine whether Section 255 or Section 716,
or both, apply in a given context.72
c.

Non-interconnected VoIP Service

40.
Background. Section 3(36) of the Act, as added by the CVAA, states that
the term "non-interconnected VoIP service" means a service that "(i) enables real-time
voice communications that originate from or terminate to the user's location using
Internet protocol or any successor protocol; and (ii) requires Internet protocol compatible
customer premises equipment" and "does not include any service that is an
interconnected VoIP service."73 In the Accessibility NPRM, the Commission proposed to
define "non-interconnected VoIP service" in our rules in the same way and sought
comment on that proposal.74
41.
Discussion. The IT and Telecom RERCs urge us to modify the statutory
definition of non-interconnected VoIP to read "any VoIP that is not interconnected
VoIP."75 They are concerned that the language in Section 3(36) which reads "does not
include any service that is an interconnected VoIP service" could be interpreted to mean
that if a service "includes both interconnected and non-interconnected VoIP, then all the
(Continued from previous page)


whenever the equipment is capable of any telecommunications function." Section 255 Report and Order,
16 FCC Rcd at 6453, 87. Similarly, "[a]n entity that provides both telecommunications and non-
telecommunications services . . . is subject to Section 255 only to the extent that it provides a
telecommunications service." Section 255 Report and Order, 16 FCC Rcd at 6450, 80.
71 See AFB Comments at 4-6. AFB states that Congress enacted Section 716(f) because industry and
advocates agreed "that it would not be fair to apply a brand new set of legal expectations to old technology
which, at least in theory, has had to be in compliance with a fifteen-year-old mandate, namely Section
255." AFB Comments at 4. Nonetheless, AFB claims, for example, that Section 716(a)(1) is
"comprehensive and requires that the equipment must be accessible, not just those functions of the
equipment that are used for advanced communications." AFB Comments at 5 (emphasis added). AFB
asserts that "the fact that the equipment can be used for advanced communications is nothing more and
nothing less than the trigger that pulls the equipment in question within the reach of the CVAA." AFB
Comments at 5.
72 For example, a complaint about the accessibility of an electronic messaging service on a mobile phone
will be resolved in accordance with the mandates of Section 716, while a complaint about the accessibility
of the voice-based telecommunications service on the same mobile phone will be resolved in accordance
with the mandates of Section 255.
73 47 U.S.C. 153(36).
74 Accessibility NPRM, 26 FCC Rcd at 3145, 31.
75 IT and Telecom RERCs Comments at 8.
17

Federal Communications Commission

FCC 11-151

non-interconnected [VoIP] is exempt because it is bundled with an interconnected VoIP
service."76 In response to these concerns, we clarify that a non-interconnected VoIP
service is not exempt simply because it is bundled or provided along with an
interconnected VoIP service.77 Accordingly, we agree with other commenters that it is
unnecessary and not appropriate to change the statutory definition78 and hereby adopt the
definition of "non-interconnected VoIP service" set forth in the Act.
d.

Electronic Messaging Service

42.
Background. Section 3(19) of the Act, as added by the CVAA, states that
the term "electronic messaging service" "means a service that provides real-time or near
real-time non-voice messages in text form between individuals over communications
networks."79 In the Accessibility NPRM, the Commission proposed to adopt that
definition and sought comment on the services included in electronic messaging service.80
The Commission also sought comment on whether services and applications that merely
provide access to an electronic messaging service, such as a broadband platform that
provides an end user access to a web-based e-mail service, are covered.81
43.
Discussion. We adopt, as proposed, the definition of "electronic
messaging service" contained in the Act.82 We agree with most commenters and find it
consistent with the Senate and House Reports that electronic messaging service includes
"more traditional, two-way interactive services such as text messaging, instant
messaging, and electronic mail, rather than . . . blog posts, online publishing, or messages
posted on social networking websites."83 While some common features of social


76 Id.
77 We interpret the meaning of the clause "does not include any service that is an interconnected VoIP
service" to mean that a service that meets the definition of an "interconnected VoIP service" is not a "non-
interconnected VoIP service." See Senate Report at 6 ("Interconnected VoIP services'' are specifically
excluded from the group of services classified as ``non-interconnected VoIP services'' under the Act).
78 See CTIA Reply Comments at 9-10 (adopting a new definition would cause confusion); Verizon Reply
Comments at 5 (Congress defined the term and the Commission has no authority to change it and no other
choice but to adopt it).
79 47 U.S.C. 153(19).
80 Accessibility NPRM, 26 FCC Rcd at 3146-3147, 33-34.
81 Accessibility NPRM, 26 FCC Rcd at 3146, 33. In addition, the Commission sought comment on
whether the "text leg" of an Internet protocol relay ("IP Relay") services call is an "electronic messaging
service" subject to the requirements of Section 716. Accessibility NPRM, 26 FCC Rcd at 3146, 33. IP
Relay is a form of telecommunications relay services ("TRS") under Section 225 of the Act. See Consumer
and Governmental Affairs Bureau, FCC Consumer Facts, IP Relay Service at
http://www.fcc.gov/cgb/consumerfacts/iprelay.html (visited September 27, 2011). We defer consideration
of whether Section 716 covers IP Relay as an electronic messaging service until such time as we can
address the applicability of Section 716 to all forms of TRS. See note 95, infra. Until that time, we
encourage all IP Relay providers to make IP Relay accessible to users who are deaf, hard of hearing, deaf-
blind, or speech disabled and who have other disabilities, if achievable.
82 47 U.S.C. 153(19).
83 Senate Report at 6; House Report at 23. See also CEA Comments at 13; IT and Telecom RERCs
Comments at 9; Microsoft Comments at 15; T-Mobile Comments at 7; TechAmerica Comments at 3-4;
(continued....)
18

Federal Communications Commission

FCC 11-151

networking sites thus fall outside the definition of "electronic messaging service," other
features of these sites are covered by Sections 716 and 717. The Wireless RERC asserts
that, to the extent a social networking system provides electronic messaging services as
defined in the Act, those services should be subject to Sections 716 and 717.84 While the
statute does not specifically reference the use of electronic messaging services as part of a
social networking site, the comments referenced above in the Senate and House Reports
suggest it was well aware that such aspects of social networking sites would fall under
the Act. The reports specifically exclude "messages posted on social networking
websites," but do not exclude the two-way interactive services offered through such
websites. We therefore conclude that to the extent such services are provided through a
social networking or related site, they are subject to Sections 716 and 717 of the Act.
44.
We also find, as proposed in the Accessibility NPRM, that the phrase
"between individuals" precludes the application of the accessibility requirements to
communications in which no human is involved, such as automatic software updates or
other device-to-device or machine-to-machine communications.85 Such exchanges
between devices are also excluded from the definition of electronic messaging service
when they are not "messages in text form."86 The definitional requirement that electronic
messaging service be "between individuals"87 also excludes human-to-machine or
machine-to-human communications.88
(Continued from previous page)


TIA Comments at 10; Verizon comments at 7-8; CEA Reply Comments at 7-8; T-Mobile Reply Comments
at 8. While we recognize that Congress's "primary concerns . . . are focused on more traditional, two-way,
interactive services," we do not interpret that expression of primary concerns or focus to exempt new or
less traditional electronic messaging services that fully meet the definition in the Act. Senate Report at 6;
House Report at 23.
84 Wireless RERC Comments at 3. See, e.g., Facebook Chat information available at
http://www.facebook.com/help/?topic=chat (visited September 17, 2011) and Facebook Messages
information available at http://www.facebook.com/help/?topic=messages_and_inbox (visited September
17, 2011). Similarly, to the extent a social networking system provides "non-interconnected VoIP
services" or "interoperable video conferencing services," as defined in the Act, those services are subject to
the accessibility requirements of Sections 716 and 717.
85 47 U.S.C. 153(19) (definition of "electronic messaging service"). Accord, AT&T Comments at 5;
CEA Comments at 13; Consumer Groups Comments at 6; CTIA Comments at 20; ESA Comments at 3; ITI
Comments at 23-24; Microsoft Comments at 15; T-Mobile Comments at 7; TechAmerica Comments at 3-
4; TIA Comments at 10; Verizon Comments at 7-8; VON Coalition Comments at 4-5; Words+ and
Compusult Comments at 13; CEA Reply Comments at 7; CTIA Reply Comments at 10-11. See also ITI
Comments at 23-24 (urging us to limit the definition of "electronic messaging service" to services designed
primarily for communication between individuals and to services that involve a store-forward modality).
86 47 U.S.C. 153(19).
87 47 U.S.C. 153(19).
88 See CEA Comments at 13; ITI Comments at 23-24; Microsoft Comments at 15; T-Mobile Comments at
7; VON Coalition Comments at 4-5; CEA Reply Comments at 7; T-Mobile Reply Comments at 8. As a
practical matter, however, we agree with AFB that these exclusions will have little practical effect on the
experience of the human user as the message recipient or sender. AFB Reply Comments at 6.
19

Federal Communications Commission

FCC 11-151

45.
We conclude that Section 2(a) of the CVAA89 exempts entities, such as
Internet service providers, from liability for violations of Section 716 when they are
acting only to transmit covered services or to provide an information location tool.90
Thus, service providers that merely provide access to an electronic messaging service,
such as a broadband platform that provides an end user with access to a web-based e-mail
service, are excluded from the accessibility requirements of Section 716.
e.

Interoperable Video Conferencing Service

46.
Background. As noted above, an "interoperable video conferencing
service" is one of the enumerated "advanced communications services" in the CVAA.
Such a service is defined by the CVAA as one "that provides real-time video
communications, including audio, to enable users to share information of the user's
choosing."91 One question that has arisen is what Congress meant by including the term
"interoperable." In the Accessibility NPRM, the Commission noted that earlier versions
of the legislation did not include the word "interoperable" in the definition of the term
"advanced communications services" and that the definition of "interoperable video
conferencing services" in the enacted legislation is identical to the definition of "video
conferencing services" found in earlier versions.92 In addition, language in the Senate
Report regarding "interoperable video conferencing services" is identical to language in
the House Report regarding "video conferencing services."93 Both the Senate Report and
the House Report state that "[t]he inclusion . . . of these services within the scope of the
requirements of this act is to ensure, in part, that individuals with disabilities are able to


89 Section 2(a) of the CVAA provides that no person shall be liable for a violation of the requirements of
the CVAA to the extent that person "transmits, routes, or stores in intermediate or transient storage the
communications made available through the provision of advanced communications services by a third
party" or who "provides an information location tool, such as a directory, index, reference, pointer, menu,
guide, user interface, or hypertext link, through which an end user obtains access to such video
programming, online content, applications, services, advanced communications services, or equipment used
to provide or access advanced communications services." Pub. L. No. 111-260, Section 2(a). These
limitations on liability do not apply "to any person who relies on third-party applications, services,
software, hardware, or equipment to comply with the requirements of the [CVAA]." Id. at 2(b).
90 See Pub. L. No. 111-260, 2(a). See also Senate Report at 5, House Report at 22 ("Section 2 provides
liability protection where an entity is acting as a passive conduit of communications made available
through the provision of advanced communications services by a third party . . .."); CEA Comments at 14;
CTIA Comments at 20; CTIA Reply Comments at 10; NCTA Reply Comments at 3. But see Consumer
Groups Comments at 6. We disagree with T-Mobile that third-party or web-based electronic messaging
services that might be accessed via a mobile device, but are not offered by the underlying Internet service
provider, are expressly excluded from the definition of "electronic messaging service." T-Mobile
Comments at 7. Instead, Section 2(a) immunizes Internet service providers that are passive conduits for
third-party advanced communications services.
91 47 U.S.C. 153(1) and (27).
92 Accessibility NPRM, 26 FCC Rcd at 3147, 35, citing S. 3304 and H.R. 3101.
93 See Senate Report at 18; House Report at 38.
20

Federal Communications Commission

FCC 11-151

access and control these services"94 and that "such services may, by themselves, be
accessibility solutions."95
47.
Discussion. Many commenters argue that that the word "interoperable"
cannot be read out of the statute, and we agree.96 Congress expressly included the term
"interoperable," and therefore the Commission must determine its meaning in the context
of the statute. We find, however, that the record is insufficient to determine how exactly
to define "interoperable," and thus we seek further comment on this issue in the Further
Notice
below.
48.
We also find that the inclusion of the word "interoperable" does not
suggest that Congress sought to require interoperability, as some commenters have
suggested.97 There simply is no language in the CVAA to support commenters' views
that interoperability is required or should be required, or that that we may require video
conferencing services to be interoperable because "interoperability" is a subset of
"accessibility," "usability," and "compatibility" as required by Section 716.98
49.
We reject CTIA's argument that personal computers, tablets, and
smartphones should not be considered equipment used for interoperable video
conferencing service, because these devices are not primarily designed for two-way video
conferencing, and accessibility should be required only for equipment designed primarily
or specifically for interoperable video conferencing service.99 Consumers get their
advanced communications services primarily through multipurpose devices, including
smartphones, tablets, laptops and desktops. If Section 716 applies only to equipment that


94 See Senate Report at 6; House Report at 25.
95 Id. In addition, the Commission sought comment on whether the "video leg" of a video relay service
("VRS") call and point-to-point calls made by deaf or hard of hearing consumers who use video equipment
distributed by VRS providers are covered under the CVAA. Accessibility NPRM, 26 FCC Rcd at 3148-49,
39-40. VRS is a form of telecommunications relay services ("TRS") under Section 225 of the Act. See
Consumer and Governmental Affairs Bureau, FCC Consumer Facts, IP Relay Service at
http://www.fcc.gov/cgb/consumerfacts/videorelay.html (viewed September 27, 2011). We are addressing,
in a separate proceeding, a possible restructuring of the VRS program, including issues regarding
regulatory structure, equipment and compensation. See Structure and Practices of the Video Relay Service
Program
, Notice of Inquiry, CG Docket No. 10-51, 25 FCC Rcd 8597 (2010) ("VRS Restructuring NOI").
Because the resolution of the issues addressed in that proceeding could have an impact on the regulatory
treatment of VRS services and equipment, as well as other forms of TRS, we will defer consideration of
whether Section 716 covers VRS or point-to-point calls as interoperable video conferencing services until
after we resolve the issues raised in the VRS Restructuring NOI proceeding. Until that time, we encourage
all VRS providers to make VRS and point-to-point video conferencing services accessible to users who are
deaf, hard of hearing, deaf-blind, or speech disabled and have other disabilities, if achievable.
96 See, e.g., CTIA Comments at 22; ESA Comments at 3; ITI Comments at 24; Microsoft Comments at 4;
TechAmerica Comments at 4-5; TIA Comments at 12; T-Mobile Comments at 7; Verizon Comments at 9;
VON Coalition Comments at 5-6.
97 See IT and Telecom RERCs Comments at 13-14; CSDVRS Reply Comments at 2-4.
98 See Consumer Groups Comments at 9-10.
99 See, e.g., CTIA Comments at 20-21.
21

Federal Communications Commission

FCC 11-151

is used exclusively for advanced communications services,100 almost no devices would be
covered by Section 716, and therefore Congress's aims in enacting the statute would be
undermined.
50.
With respect to webinars and webcasts,101 we find that services and
equipment that provide real-time video communications, including audio, between two or
more users
, are "video conferencing services" and equipment, even if they can also be
used for video broadcasting purposes (only from one user).102 We disagree, however,
with the IT and Telecom RERCs that providing interactive text messaging, chatting,
voting, or hand-raising by or between two or more users, along with real-time video
communications, including audio, only from one user, constitutes a "video conferencing
service."103 In this example of a system that provides multiple modes of communication
simultaneously, providing text messaging between two or more users is an electronic
messaging service. Similarly, telecommunications or VoIP services may be provided as
part of a webinar or webcast. The provision of electronic messaging, VoIP, or other
services, alongside real-time video communications, including audio, only from one user,
does not convert the latter into a "video conferencing service."104
51.
Finally, we agree with commenters that non-real-time or near-real-time
features or functions of a video conferencing service, such as video mail, do not meet the
definition of "real-time" video communications."105 We defer consideration to the
Further Notice as to whether we should exercise our ancillary jurisdiction to require that
a video mail service be accessible to individuals with disabilities when provided along


100 See ESA Comments at 3 (application of CVAA requirements should be limited only to "equipment used
for advanced communications services," not other purposes); NCTA Comments at 7 (suggesting that
Section 716 apply to equipment used only for advanced communications services).
101 See Accessibility NPRM, 26 FCC Rcd at 3149-50, 41-42.
102 See Consumer Group Comments at 8 (the application of accessibility requirements is based on the fact
that the service and equipment provide the advanced communications as defined in the Act, not on whether
the service or equipment may be or is used to also provide another form of communication); IT and
Telecom RERCs Comments at 12. But see TIA Comments at 10-11 (videos broadcast by one user to
multiple participants, and that do not provide for a two-way video exchange of information, are not video
conferencing services). In other words, the service and equipment must provide the user with the
opportunity, but not the obligation to communicate in the manner as defined in the Act. See Words+ and
Compusult Comments at 14. But see Microsoft Comments at 3, n.2 (the CVAA does not apply to webinars
because they are designed primarily to broadcast information).
103 IT and Telecom RERCs Comments at 12. See also Words+ and Compusult Comments at 14.
104 Entities that use advanced communications services and equipment may have legal obligations to ensure
the accessibility of their programs and services, including the obligation to communicate effectively, under
other disability related statutes such as Section 504 of the Rehabilitation Act of 1973 and the Americans
with Disabilities Act of 1990. See 29 U.S.C. 794(d); 42 U.S.C. 12101-12213.
105 See Accessibility NPRM, 26 FCC Rcd at 3149-50, 41-42. See, e.g., CEA Comments at 15-16; CTIA
Comments at 21; Verizon Comments at 9; NCTA Reply Comments at 6-7. As a technical matter, "video
mail" may not be "real-time" communication, but, as a practical matter, if an interoperable video
conferencing service and equipment is accessible, the video mail feature or function will likely also be
accessible.
22

Federal Communications Commission

FCC 11-151

with a video conferencing service.106 We also do not decide at this time whether our
ancillary jurisdiction extends to require other features or functions provided along with a
video conferencing service, such as recording and playing back video communications on
demand, to be accessible.107
2.

Manufacturers of Equipment Used for Advanced
Communications Services

52.
Background. Section 716(a) of the Act provides that, with respect to
equipment manufactured after the effective date of applicable regulations established by
the Commission and subject to those regulations, the accessibility obligations apply to a
"manufacturer of equipment used for advanced communications services, including end
user equipment, network equipment, and software . . . that such manufacturer offers for
sale or otherwise distributes in interstate commerce."108 In the Accessibility NPRM, the
Commission sought comment on several issues and proposals relating to how it should
interpret this provision.109
53.
The Commission proposed to define "end user equipment" as including
hardware;110 "software" as including the operating system,111 user interface layer,112 and
applications,113 that are installed or embedded in the end user equipment by the
manufacturer of the end user equipment or by the user; and "network equipment" as
equipment used for network services.114 It also sought comment on whether upgrades to
software by manufacturers are included in this definition.115
54.
The Commission sought comment on the meaning of the phrase "used for
advanced communications services" and asked whether equipment subject to Section
716(a) must merely support or be capable of offering advanced communications services
on a stand-alone basis.116 Consistent with the Commission's Section 255 rules, the


106 See CEA Comments at 15-16 (consideration of video mail is premature); CTIA Comments at 21
(asserting that the definition precludes the exercise of our ancillary jurisdiction). But see Consumer Groups
Comments at 9 (urging us to exercise our ancillary jurisdiction to require accessibility).
107 See IT and Telecom RERCs Comments at 12 (asserting that, "if a person with a disability is unable to
attend a live videoconference, that person should not lose the ability to access it through a later download
or streaming, if non-disabled participants can access it later").
108 See 47 U.S.C. 617(a)(1).
109 See Accessibility NPRM, 26 FCC Rcd at 3142-43, 19-24.
110 See note 142, infra.
111 See note 143, infra.
112 See note 144, infra.
113 See note 145, infra.
114 See note 146, infra.
115 Accessibility NPRM, 26 FCC Rcd at 3143, 21.
116 47 U.S.C. 617(a)(1); Accessibility NPRM, 26 FCC Rcd at 3143, 22.
23

Federal Communications Commission

FCC 11-151

Commission also proposed to define "manufacturer" as "an entity that makes or produces
a product."117
55.
The Commission also sought comment on software upgrades, whether the
limitations on liability in Section 2(a) of the CVAA generally preclude manufacturers of
end user equipment from being liable for third-party applications that are installed or
downloaded by the consumer,118 and whether manufacturers of software used for
advanced communications services that is downloaded or installed by the user are
covered by Section 716(a).119 Finally, the Commission sought comment on Section
718,120 which requires manufacturers and service providers to make Internet browsers
built into mobile phones accessible to people who are blind or have visual impairments.121
Specifically, the Commission sought input on steps the Commission and stakeholders
could take to ensure that manufacturers and service providers could meet their obligations
by 2013.122
56.
Discussion. Section 716(a)(1) states the following:
a manufacturer of equipment used for advanced communications services,
including end user equipment, network equipment, and software, shall
ensure that the equipment and software that such manufacturer offers for
sale or otherwise distributes in interstate commerce shall be accessible to
and usable by individuals with disabilities, unless the requirements of this
subsection are not achievable.123
57.
In the Accessibility NPRM the Commission proposed to find that
developers of software that is used for advanced communications services and that is
downloaded or installed by the user rather than by a manufacturer are covered by Section
716(a).124 The IT and Telecom RERCs support that proposal on the grounds that
coverage should not turn on how a manufacturer distributes ACS software (pre-installed
on a device or installed by the user).125 Microsoft and the VON Coalition, on the other
hand, argue that Section 716(a) must be read as applying only to manufacturers of
equipment, that "software" is not "equipment," and that our proposal would


117 47 C.F.R. 6.3(f). See also Section 255 Report and Order, 16 FCC Rcd at 6454, 90.
118 Accessibility NPRM, 26 FCC Rcd at 3143, 21. See also note 89, supra.
119 Accessibility NPRM, 26 FCC Rcd at 3143, 24.
120 47 U.S.C. 619.
121 Accessibility NPRM, 26 FCC Rcd at 3186, 143-144.
122 Accessibility NPRM, 26 FCC Rcd at 3186, 144.
123 47 U.S.C. 617(a)(1) (emphasis added).
124 Accessibility NPRM, 26 FCC Rcd at 3143, 24.
125 IT and Telecom RERCs Comments at 4-5.
24

Federal Communications Commission

FCC 11-151

impermissibly extend the Commission's authority beyond the limits set by Congress in
the CVAA.126
58.
We find that, while the language of Section 716(a)(1) is ambiguous, the
better interpretation of Section 716(a)(1) is that it does not impose independent regulatory
obligations on providers of software that the end user acquires separately from equipment
used for advanced communications services.
59.
Section 716(a)(1) can be read in at least two ways. Under one reading, the
italicized phrase "including end user equipment, network equipment, and software"
defines the full range of equipment manufacturers covered by the Act. Under this
construction, manufacturers of end user equipment used for ACS, manufacturers of
network equipment used for ACS, and manufacturers of software used for ACS, would
all independently be subject to the accessibility obligations of Section 716(a)(1), and to
the enforcement regime of Section 717. "Equipment," as used in the phrase "a
manufacturer of equipment used for advanced communications services" would thus refer
both to physical machines or devices and to software that is acquired by the user
separately from any machine or device, and software would be understood to be a type of
equipment. This first reading is the interpretation on which we sought comment in the
Accessibility NPRM.127
60.
Under a second possible reading, the phrase "manufacturer of equipment"
would be given its common meaning as referring to makers of physical machines or
devices. If such equipment is used for advanced communications services, then the
equipment manufacturer is responsible for making it accessible. Under this reading, the
phrase "including end user equipment, network equipment, and software" makes clear
that both end user equipment and network equipment, as well as the software included by
the manufacturer in such equipment, must be consistent with the CVAA's accessibility
mandate.128 Thus, to the extent that equipment used for advanced communications
services include software components -- for example, operating systems or e-mail clients
-- the manufacturer of the equipment is responsible for making sure that both "the
equipment and software that such manufacturer offers for sale or otherwise distributes in
interstate commerce" is accessible.129


126 Letter from Gerard J. Waldron, Counsel to Microsoft Corp., to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 1-2 (filed Sept. 9, 2011) ("Microsoft Sept. 9 Ex Parte"); Letter from Glenn S.
Richards, Executive Director, Voice on the Net Coalition, to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 4-5 (filed Aug. 12, 2011) ("VON Coalition Aug. 12 Ex Parte"); Letter from Glenn
S. Richards, Executive Director, Voice on the Net Coalition, to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 3 (filed Sept. 6, 2011) ("VON Coalition Sept. 6 Ex Parte").
127 Accessibility NPRM, 26 FCC Rcd at 3143, 21. See also para. 53, supra (definitions of end user
equipment and software proposed in the Accessibility NPRM).
128 We have modified the definitions of "end user equipment" and "network equipment" that are proposed
in the Accessibility NPRM to make clear that such equipment may include both hardware and software
components.
129 47 U.S.C. 617(a)(1) (emphasis added).
25

Federal Communications Commission

FCC 11-151

61.
The text of the CVAA does not compel either of these inconsistent
readings. The first, more expansive, reading accords more easily with the use of commas
surrounding and within the phrase ", including end user equipment, network equipment,
and software," but it requires giving the term "equipment" a meaning that is far broader
than its ordinary usage. In addition, if "equipment" means "software" as well as
hardware, then there was no need for Congress to say in the same sentence that "the
equipment and software" that a manufacturer offers must be made accessible. The
second, narrower, reading gives a more natural meaning to the word "equipment" and
explains why it was necessary for Congress to say that the manufacturer of equipment
used for ACS must make both "equipment and software" accessible. The second reading
is thus more consistent with the interpretive canon that all words in a statute should if
possible be given meaning and not deemed to be surplusage (as "software" would be in
this phrase under the first reading).130
62.
Looking to other provisions of the CVAA, the language of Section 716(j)
is more consistent with the second, narrower understanding of Section 716(a)(1). Section
716(j) establishes a rule of construction to govern our implementation of the Act, stating
that Section 716 shall not be construed to require a manufacturer of equipment used for
ACS or a provider of ACS "to make every feature and function of every device or service
accessible for every disability."131 The word "device" refers to a physical object and
cannot reasonably be construed to also refer to separately-acquired software. If, as in the
broader interpretation of Section 716(a)(1), "manufacturer of equipment" includes
manufacturers of separately acquired software, then Congress created a rule of
construction for Section 716 as a whole that applies to only some of the equipment that is
subject to Section 716(a). The narrower interpretation of Section 716(a)(1) produces a
more logical result, in that Section 716(j), as it applies to manufacturers of equipment,
has the same scope as Section 716(a).
63.
Examining the legislative history of the CVAA, we find no indication in
either the Senate Report or the House Report that Congress intended to instruct the
Commission to regulate directly software developers that are neither manufacturers of
equipment nor providers of advanced communications services -- a class of businesses
that the Commission historically has not regulated. There is, on the other hand, evidence
that Congress had makers of physical objects in mind when it made "manufacturers of
equipment" responsible for accessibility. For example, the Senate Report states that the
Act requires manufacturers of equipment used for ACS and providers of ACS to "make
any such equipment, which they design, develop, and fabricate, accessible to individuals
with disabilities, if doing so is achievable."132 The Senate Report further says that


130 See Montclair v. Ramsdell, 107 U.S. 147, 152 (1883); Astoria Federal Savings & Loan Ass'n v.
Solimino
, 501 U.S. 104, 112 (1991); Sprietsma v. Mercury Marine, 537 U.S. 51, 63 (2003) (interpreting
word "law" broadly could render word "regulation" superfluous in preemption clause applicable to a state
"law or regulation"); Bailey v. United States, 516 U.S. 137, 146 (1995) ("we assume that Congress used
two terms because it intended each term to have a particular, nonsuperfluous meaning").
131 47 U.S.C. 617(j).
132 Senate Report at 7 (emphasis added).
26

Federal Communications Commission

FCC 11-151

Sections 716(a) and 716(b) "require that manufacturers and service providers,
respectively, make their devices and services accessible to people with disabilities."133
Likewise, the House Report states that Sections 716(a) and 716(b) "give manufacturers
and service providers a choice regarding how accessibility will be incorporated into a
device or service."134 Software is not fabricated, nor are software programs or
applications referred to as devices.135 Particularly in light of this legislative history, we
are doubtful that Congress would have significantly expanded the Commission's
traditional jurisdiction to reach software developers, without any clear statement of such
intent.
64.
We disagree with commenters that suggest that the Commission's
interpretation of "customer premises equipment" ("CPE") in the Section 255 Report and
Order
compels us to find that software developers that are neither manufacturers of ACS
equipment nor providers of ACS are covered under Section 716(a).136 First, in the
Section 255 Report and Order, the Commission found that CPE "includes software
integral to the operation of the telecommunications function of the equipment, whether
sold separately or not."137 Although the statutory definition of CPE did not reference
software, the Commission found that it should construe CPE similarly to how it construed
"telecommunications equipment" in the Act, which Congress explicitly defined to
include "software integral to such equipment (including upgrades)."138 The Commission
did not in the Section 255 Report and Order reach the issue of whether any entity that
was not a manufacturer of the end user equipment or provider of telecommunications
services had separate responsibilities under the Act.139


133 Senate Report at 7 (emphasis added).
134 House Report at 24 (emphasis added).
135 Similarly, Section 716(j) of the Act also uses the word "device" as a synonym for "equipment." 47
U.S.C. 617(j).
136 See, e.g., Letter from Andrew S. Phillips, Counsel to National Association of the Deaf, on behalf of the
Coalition of Organizations for Accessible Technology (COAT), to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 2 (filed Sept.28, 2011) ("COAT Sept. 28 Ex Parte").
137 Section 255 Report and Order, 16 FCC Rcd at 6451, 83.
138 CPE is defined in the Act as "equipment employed on the premises of a person (other than a carrier) to
originate, route, or terminate telecommunications." 47 U.S.C. 153(14). Telecommunications equipment
is defined as "equipment, other than customer premises equipment, used by the carrier to provide
telecommunications services, and includes software integral to such equipment (including upgrades)." 47
U.S.C. 153(45).
139 When using its ancillary authority to apply similar obligations to interconnected VoIP providers, the
Commission imposed obligations on "providers of interconnected VoIP service and to manufacturers of
equipment that is specifically designed for that service, including specially designed software, hardware,
and network equipment." But the Commission did not revisit its fundamental conclusions regarding the
manufacturers of telecommunications equipment and providers of telecommunications services addressed
directly by Section 255. IP-Enabled Services; Implementation of Sections 255 and 251(a)(2) of the
Communications Act of 1934, as Enacted by the Telecommunications Act of 1996
, WC Docket No. 04-36,
WT Docket No. 96-196, CG Docket No. 03-123 and CC Docket No. 92-105, 22 FCC Rcd 11275, 11286
20 (1997).
27

Federal Communications Commission

FCC 11-151

65.
Second, in the CVAA, Congress gave no indication that it intended the
Commission to incorporate, when defining the scope of "equipment and software" for
purposes of Section 716(a)(1), the definitions we have established for the different, but
analogous, terms ("telecommunications equipment" and "customer premises equipment")
used in Section 255. Here, we interpret the statutory language to include all software,
including upgrades, that is used for ACS and that is a component of the end user
equipment, network equipment, or of the ACS service and do not limit software to
meaning only software that is integral to the network equipment or end user equipment.
As we discuss further in paragraph 86, infra, if software gives the consumer the ability to
engage in advanced communications, the provider of that software is a covered entity,
regardless of whether the software is downloaded to the consumer's equipment or
accessed in the cloud.
66.
The purpose of Sections 716 through 718 of the CVAA to ensure access
to advanced communications services for people with disabilities is fully served by the
narrower interpretation of Section 716(a) that we describe above because that
interpretation focuses our regulatory efforts where they will be the most productive.
67.
Advanced communications services are delivered within a complex and
evolving ecosystem. 140 Communications devices are often general-purpose computers or
devices incorporating aspects of general-purpose computers, such as smartphones,
tablets, and entertainment devices.141 In the Accessibility NPRM we observed that such
systems are commonly described as having five components or layers: (1) hardware
(commonly referred to as the "device");142 (2) operating system;143 (3) user interface
layer;144 (4) application;145 and (5) network services.146 We agree with ITI that three


140 See Accessibility NPRM, 26 FCC Rcd at 3140, 14-15, citing Kaveh Pahlavan & Prashant
Krishnamurthy, NETWORKING FUNDAMENTALS: WIDE, LOCAL, & PERSONAL AREA COMMUNICATIONS at
21-25 (John Wiley and Sons Ltd. 2009), and http://www.qualcomm.com/documents/files/evolution-toward-
multimode-future.pdf, at 3, 8-9.
141 See Accessibility NPRM, 26 FCC Rcd at 3140, 15, citing Kaveh Pahlavan & Prashant Krishnamurthy,
NETWORKING FUNDAMENTALS: WIDE, LOCAL, & PERSONAL AREA COMMUNICATIONS 21-23 (John Wiley
and Sons Ltd. 2009), and http://www.qualcomm.com/documents/files/evolution-toward-multimode-
future.pdf, at 3, 8-9.
142 Advanced communications services may rely on hardware with general-purpose computing
functionality that typically includes a central processing unit ("CPU"), several kinds of memory, one or
more network interfaces, built-in peripherals, and both generic and dedicated-purpose interfaces to external
peripherals. Accessibility NPRM, 26 FCC Rcd at 3141, 15.
143 Almost all devices with a CPU have an operating system that manages the system resources and
provides common functionality, such as network protocols, to applications. Accessibility NPRM, 26 FCC
Rcd at 3140, 15, citing William Stallings, OPERATING SYSTEMS, INTERNALS AND DESIGN PRINCIPLES, 51-
55 (Pearson and Prentice Hall 2009); Abraham Silberschatz, Peter B. Galvin & Greg Gagne, OPERATING
SYSTEM CONCEPTS, 3-5 (Wiley 8th ed. 2008).
144 Most modern devices have a separate user interface layer upon which almost all applications rely to
create their graphical user interface, and which is typically provided as a package with the operating
system.144 Accessibility NPRM, 26 FCC Rcd at 3140, 15, citing William Stallings, OPERATING SYSTEMS,
INTERNALS AND DESIGN PRINCIPLES, 51, 84-86 (Pearson and Prentice Hall 2009). In many cases, web
(continued....)
28

Federal Communications Commission

FCC 11-151

additional components in the architecture play a role in ensuring the accessibility of ACS:
(1) assistive technology ("AT") utilized by the end user; (2) the accessibility application
programming interface ("API");147 and (3) the web browser.148
68.
For individuals with disabilities to use an advanced communications
service, all of these components may have to support accessibility features and
capabilities.149 It is clear, however, that Congress did not give us the task of directly
regulating the manufacturers, developers, and providers all of these components. Rather,
Congress chose to focus our regulatory and enforcement efforts on the equipment
manufacturers and the ACS providers.
69.
We believe that end user equipment manufacturers, in collaboration with
the developers of the software components of the equipment and related service
providers, are best equipped to be ultimately responsible for ensuring that all of the
components that the end user equipment manufacturer provides are accessible to and
usable by individuals with disabilities.150 The manufacturer is the one that purchases
those components and is therefore in a position to require that each of those components
supports accessibility.151 Similarly, as we discuss further below,152 the provider of an
advanced communications service is the entity in the best position to make sure that the
(Continued from previous page)


browsers are considered to be part of the user interface layer although they themselves are also an
application. Accessibility NPRM, 26 FCC Rcd at 3140, 15.
145 Software, which may be embedded into the device and non-removable, installed by the system
integrator or user, or reside in the cloud, is used to implement the actual advanced communications
functionality. Accessibility NPRM, 26 FCC Rcd at 3141, 15, citing Media Phone by Intel Corporation.
http://edc.intel.com/Applications/Embedded-Connected-Devices/.
146 Advanced communications applications rely on network services to interconnect users. Accessibility
NPRM
, 26 FCC Rcd at 3141, 15. These networks perform many functions, ranging from user
authentication and authorization to call routing and media storage and may also provide the advanced
communication applications. Id.
147 ITI uses the term "Accessibility Services" to describe what the Commission refers to as the accessibility
API.
148 Letter from Ken J. Salaets, Director, Information Technology Industry Council, to Marlene H. Dortch,
Secretary, FCC, CG Docket No. 10-213 (filed July 8, 2011) ("ITI July 8 Ex Parte"). We would note that in
its original description of the architecture, the Commission stated that "in many cases, web browsers are
considered to be part of the user interface layer, although they themselves are also an application."
Accessibility NPRM, 26 FCC Rcd at 3141, 15.
149 Accessibility NPRM, 26 FCC Rcd at 3142, 17.
150 Manufacturers are responsible for the software components of their equipment whether they pre-install
the software, provide the software to the consumer on a physical medium such as a CD, or require the
consumer to download the software.
151 But see Green Reply Comments at 5 (arguing that the operating systems developers, rather than end user
equipment manufacturers or other software developers, should be responsible for accessibility, because
they are limited in number and have significant resources and contractual leverage).
152 See Providers of Advanced Communications Services, Section III.A.3, infra.
29

Federal Communications Commission

FCC 11-151

components (hardware, software on end user devices, components that reside on the web)
it provides and that make up its service all support accessibility.
70.
We believe these conclusions will foster industry collaboration between
manufacturers of end user equipment, software manufacturers, and service providers and
agree with TWC that this collaboration must be a central tenet in the efforts to implement
the CVAA.153 For example, as Microsoft states, "a laptop manufacturer that builds ACS
into its device will need to consult with the developer of the operating system to develop
this functionality, and in that way the operating system provider will be deeply involved
in solving these problems and promoting innovations in accessibility, such as making an
accessibility API available to the manufacturer."154 The consumer, who is not a party to
any arrangements or agreements, contractual or otherwise, between an end user
equipment manufacturer and a software developer, will not be put in the position of
having to divine which entity is ultimately responsible for the accessibility of end user
equipment used for advanced communications services.
71.
We recognize that consumers are able to change many of the software
components of the equipment they use for advanced communications services, including,
for some kinds of equipment, the operating systems, e-mail clients, and other installed
software used for ACS. We believe that, as a practical matter, operating systems and
other software that are incorporated by manufacturers into their equipment will also be
accessible when made separately available because it will not be efficient or economical
for developers of software used to provide ACS to make accessible versions of their
products for equipment manufacturers that pre-install the software and non-accessible
freestanding versions of the same products. Therefore, we believe that we do not need to
adopt an expansive interpretation of the scope of Section 716(a) to ensure that consumers
receive the benefits intended by Congress.
72.
Section 717(b)(1) of the Act requires us to report to Congress every two
years, beginning in 2012. We are required, among other things, to report on the extent to
which accessibility barriers still exist with respect to new communications technologies.
We intend to pay particular attention in these reports to the question of whether entities
that are not directly subject to our regulations, including software developers, are causing
such barriers to persist.
73.
Finally, the narrower interpretation of the scope of Section 716(a) that we
adopt today makes this statutory program more cost-effective than would the more
expansive interpretation. Covered entities are subject not only to the substantive
requirement that they make their products accessible, if achievable, but also to an
enforcement mechanism that includes recordkeeping and certification requirements. This
type of enforcement program imposes costs on both industry and the government.


153 TWC cautions that requiring service providers to offer particular capabilities (i.e., accessible services)
risks being largely meaningless if equipment manufacturers are not required to build the requisite
functionality into their consumer devices, and urges the Commission to hold manufacturers to their
obligations under the CVAA. TWC Comments at 7.
154 Microsoft Comments at 12.
30

Federal Communications Commission

FCC 11-151

Congress made a determination, which we endorse and enforce, that these costs are well
justified to realize the accessibility benefits that the CVAA will bring about. But the
costs of extending design, recordkeeping, and certification requirements to software
developers would be justified only if they were outweighed by substantial additional
accessibility benefits.
74.
As explained above, it appears that the benefits of accessibility, as
envisioned by Congress and supporters of the CVAA, can be largely (and perhaps
entirely) realized under the narrower, less costly interpretation of Section 716(a)(1).
Furthermore, the biennial review requirement of Section 717(b)(1) ensures that, if our
prediction proves incorrect, the Commission will have an occasion to examine whether
application of the CVAA's requirements directly to developers of consumer-installed
software is warranted, and make any necessary adjustments to our rules to achieve
accessibility in accordance with the intent of the CVAA. This biennial review process
gives us additional confidence that applying the statute more narrowly and cautiously in
our initial rules is the most appropriate policy at this time.
75.
With respect to the definition of "manufacturer," consistent with the
Commission's approach in the Section 255 Report and Order and in the Accessibility
NPRM
, we define "manufacturer" as "an entity that makes or produces a product."155 As
the Commission noted in the Section 255 Report and Order, "[t]his definition puts
responsibility on those who have direct control over the products produced, and provides
a ready point of contact for consumers and the Commission in getting answers to
accessibility questions and resolving complaints."156 We believe this definition
encompasses entities that are "extensively involved in the manufacturing process for
example, by providing product specifications."157 We also believe this definition includes
entities that contract with other entities to make or produce a product; a manufacturer
need not own a production facility or handle raw materials to be a manufacturer.158
76.
TechAmerica argues that Section 716(a) should apply only to equipment
with a "primary purpose" of offering ACS.159 We reject this interpretation. As discussed
above,160 consumers commonly access advanced communications services through


155 In accord, CEA Comments at 8; T-Mobile Comments at 4-5 (adopting this definition will help "draw a
bright line" between service providers and manufacturers).
156 Section 255 Report and Order, 16 FCC Rcd at 6454, 90.
157 Section 255 Report and Order, 16 FCC Rcd at 6454, 90. See also ITI Comments at 25.
158 See the North American Industry Classification System ("NAICS") definition of "manufacturing,"
which includes "establishments [that] may process materials or may contract with other establishments to
process their materials for them." 2007 NAICS Definition, Section 31-33 Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=31&search=2007%20NAICS%20Search. See
also
Exemptions for Small Entities Temporary Exemption of Section 716 Requirements, Section III.C.3,
infra, for a detailed discussion of NAICS.
159 TechAmerica Comments at 3.
160 See para. 67, supra. See also para. 49, supra.
31

Federal Communications Commission

FCC 11-151

general purpose devices. The CVAA covers equipment "used for ACS,"161 and we
interpret this to include general purpose hardware with included software that provides
users with access to advanced communications services.
77.
Commenters also expressed concerns about the impact of software
upgrades on accessibility. The IT and Telecom RERCs state that "[u]pgrades can be used
to increase accessibility . . . or they can take accessibility away, as has, unfortunately
occurred on numerous occasions."162 Wireless RERC urges that "[e]nd-users who buy an
accessible device expect manufacturer-provided updates and upgrades to continue to be
accessible."163 We agree that the purposes of the CVAA would be undermined if it
permitted equipment or services that are originally required to be accessible to become
inaccessible due to software upgrades. In accordance with our interpretation of 716(a)(1)
above, just as a manufacturer of a device is responsible for the accessibility of included
software, that manufacturer is also responsible for ensuring that the software developer
maintains accessibility if and when it provides upgrades. However, we agree with CTIA
that a manufacturer cannot be responsible for software upgrades "that it does not control
and that it has no knowledge the user may select and download."164
78.
Indeed, we recognize more generally, as ITI urges, that manufacturers of
equipment are not responsible for the components over which they have no control.165
Thus, manufacturers are not responsible for software that is independently selected and
installed by users, or for software that users choose to access in the cloud.166
Furthermore, we generally agree with commenters that a manufacturer is not responsible
for optional software offered as a convenience to subscribers at the time of purchase and
that carriers are not liable for third-party applications that customers download onto
mobile devices even if software is available on a carrier's website or application
store.167
79.
A manufacturer, however, has a responsibility to consider how the
components in the architecture work together when it is making a determination about
what accessibility is achievable for its product. If, for example, a manufacturer decides
to rely on a third-party software accessibility solution, even though a built-in solution is
achievable, it cannot later claim that it is not responsible for the accessibility of the third-
party solution.168 A manufacturer of end-user equipment is also responsible for the


161 47 U.S.C. 617(a)(1).
162 IT and Telecom RERCs Comments at 3.
163 Wireless RERC Comments at 2. See also Words+ and Compusult Comments at 7.
164 CTIA Comments at 10.
165 See Letter from Ken J. Salaets, Director, Information Technology Industry Council, to Marlene H.
Dortch, Secretary, FCC, CG Docket No. 10-213 (filed Aug. 9, 2011) at 1-2 ("ITI Aug. 9 Ex Parte").
166 See, e.g., AT&T Comments at 8-9: CTIA Comments at 10; IT and Telecom RERCs Comments at 3;
Microsoft Comments at 12; TechAmerica Comments at 2; Wireless RERC Comments at 2.
167 CTIA Comments at 11; Verizon Comments at 3-4.
168 See Verizon Comments at 3-4.
32

Federal Communications Commission

FCC 11-151

accessibility of software offered to subscribers if the manufacturer requires or
incentivizes a purchaser to use a particular third-party application to access all the
features of or obtain all the benefits of a device or service, or markets its device in
conjunction with a third-party add-on.169
80.
Because we did not receive a full record on the unique challenges
associated with implementing Section 718, we will solicit further input in the
accompanying Further Notice on how we should proceed. In particular, we seek
comment on the unique technical challenges associated with developing non-visual
accessibility solutions for web browsers in a mobile phone and the steps that we can take
to ensure that covered entities will be able to comply with these requirements on October
8, 2013, the date on which Section 718 becomes effective. Section 718 requires a mobile
phone manufacturer that includes a browser, or a mobile phone service provider that
arranges for a browser to be included on a mobile phone, to ensure that the browser
functions are accessible to and usable by individuals who are blind or have a visual
impairment, unless doing so is not achievable. In the accompanying Further Notice, we
also seek to develop a record on whether Internet browsers should be considered software
generally subject to the requirements of Section 716. Specifically, we seek to clarify the
relationship between Sections 716 and 718 and solicit comment on the appropriate
regulatory approach for Internet browsers that are not built into mobile phones.
3.

Providers of Advanced Communications Services

81.
Background. Section 716(b)(1) of the Act provides that, with respect to
service providers, after the effective date of applicable regulations established by the
Commission and subject to those regulations, a "provider of advanced communications
services shall ensure that such services offered by such provider in or affecting interstate
commerce are accessible to and usable by individuals with disabilities," unless these
requirements are "not achievable."170
82.
In the Accessibility NPRM,171 and consistent with the Section 255 Report
and Order,172 the Commission proposed to find that providers of advanced
communications services include all entities that make advanced communications
services available in or affecting interstate commerce, including resellers and
aggregators. The Commission also proposed to find that "providers of advanced


169 IT and Telecom RERCs Comments at 4-5. See also Words+ and Compusult Comments at 9-10
(suggesting that the service provider should be responsible for accessibility of an application that is "either
branded as the service provider's own or is the sole endorsed option or application in a category" and that
service providers should be required to include descriptions of the accessibility interfaces within their
software developer kits for third-party developers, along with best practices for accessible user interfaces).
170 See 47 U.S.C. 617(b)(1).
171 Accessibility NPRM, 26 FCC Rcd at 3144, 26.
172 See Section 255 Report and Order, 16 FCC Rcd at 6450, 80. The Commission also noted its belief
that the general principle it adopted in the Section 255 Report and Order that "Congress intended to use
the term `provider' broadly . . . to include all entities that make telecommunications services available"
applies in this context as well. Accessibility NPRM, 26 FCC Rcd at 3144, 26, citing Section 255 Report
and Order
, 16 FCC Rcd at 6450, 80.
33

Federal Communications Commission

FCC 11-151

communications services" include entities that provide advanced communications
services over their own networks as well as providers of applications or services accessed
(i.e., downloaded and run) by users over other service providers' networks, as long as
these advanced communications services are made available in or affecting interstate
commerce.173
83.
The Commission also asked whether there are any circumstances in which
a service provider would be responsible for the accessibility of third-party services and
applications or whether Section 2(a) of the CVAA would generally preclude such a
result.174 Finally, the Commission sought comment on the meaning of offered "in or
affecting interstate commerce" and whether there are any circumstances in which
advanced communications services that are downloaded or run by the user would not
meet this definition.175
84.
Discussion. Consistent with the proposal in the Accessibility NPRM, we
agree with commenters that state that we should interpret the term "providers" broadly
and include all entities that make available advanced communications in whatever
manner.176 Such providers include, for example, those that make web-based e-mail
services available to consumers; those that provide non-interconnected VoIP services
through applications that consumers download to their devices; and those that provide
texting services over a cellular network.
85.
As is the case with manufacturers, providers of ACS are responsible for
ensuring the accessibility of the underlying components of the service, to the extent that
doing so is achievable. For example, a provider of a web-based e-mail service could
meet its obligations by ensuring its services are coded to web accessibility standards
(such as the Web Content Accessibility Guidelines (WCAG)177), if achievable. For
services downloaded onto the OS of a desktop or mobile device, service providers could
meet their obligations by ensuring, if achievable, that their services are coded so they can
work with the Accessibility API for the OS of the device.178 Those that provide texting


173 Accessibility NPRM, 26 FCC Rcd at 3144, 27.
174 Accessibility NPRM, 26 FCC Rcd at 3144, 27.
175 Accessibility NPRM, 26 FCC Rcd at 3144, 27.
176 Consumer Groups Comments at 5-6.
177 Web Content Accessibility Guidelines ("WCAG") explain how to make web content (e.g., information
in a web page or web application, including text, images, forms, and sounds) more accessible to people
with disabilities. See http://www.w3.org/WAI/intro/wcag.php (viewed on September 16, 2011). The
WCAG is developed and published by the W3C Web Accessibility Initiative and provides an international
forum for industry, disability organizations, accessibility researchers, and government stakeholders. The
WCAG is part of a series of accessibility guidelines, including the Authoring Tool Accessibility Guidelines
("ATAG") and the User Agent Accessibility Guidelines ("UAAG"). Id. See also para. 101, infra
(discussing the WCAG).
178 Accessibility APIs are specialized interfaces developed by platform owners, which software
applications use to communicate accessibility information about user interfaces to assistive technologies.
HTML to Platform Accessibility APIs Implementation Guide, W3C Editor's Draft 10 June 2011, available
at http://dev.w3.org/html5/html-api-map/overview.html#intro_aapi (viewed September 15, 2011).
34

Federal Communications Commission

FCC 11-151

services over a cellular network, for example, must ensure that there is nothing in the
network that would thwart the accessibility of the service, if achievable.
86.
COAT raises the concern that some software used for ACS may be neither
a component of the end user equipment nor a component of a service and thus would not
be covered under the statute.179 Specifically, COAT argues that H.323180 video and audio
communication is peer-to-peer and does not require a service provider at all.181 Similarly,
it argues that it is possible to have large-scale examples of peer-to-peer systems without
service providers and that models used in the non-ACS context could be expanded to be
used for ACS.182 We believe that COAT construes the meaning of "provider of advanced
communications services" too narrowly. If software gives the consumer the ability to
send and receive e-mail, send and receive text messages, make non-interconnected VoIP
calls, or otherwise engage in advanced communications, then provision of that software is
provision of ACS.183 The provider of that software would be a covered entity, and the
service, including any provided through a small-scale or large-scale peer-to-peer system,
would be subject to the requirements of the statute.184 This is true regardless of whether
the software is downloaded to the consumer's equipment or accessed in the cloud.


179 Letter from Andrew S. Phillips, Counsel to National Association of the Deaf, on behalf of the Coalition
of Organizations for Accessible Technology (COAT), to Marlene H. Dortch, Secretary, FCC, CG Docket
No. 10-213, at 1-2 (filed Sept. 20, 2011) ("COAT Sept. 20 Ex Parte"); COAT Sept. 28 Ex Parte at 1-2.
180 H.323 is an ITU Telecommunication Standardization Sector (ITU-T) specification for transmitting
audio, video, and data across an Internet Protocol network, including the Internet. The H.323 standard
addresses call signaling and control, multimedia transport and control, and bandwidth control for point-to-
point and multi-point conferences. Products and applications that are compliant with H.323 can
communicate and interoperate with each other. See http://www.itu.int/rec/T-REC-H.323/en/ (last visited
September 27, 2011); Jonathan Davidson, Brian Gracely & James Peters, Voice over IP fundamentals pp.
229230 (Cisco Press 2000).
181 COAT Sept. 20 Ex Parte at 2; COAT Sept. 28 Ex Parte at 1-2.
182 COAT suggests that it is possible for ACS to follow the model of such large scale peer-to-peer systems
as Diaspora and Bit Torrent. COAT Sept. 20 Ex Parte at 2; COAT Sept. 28 Ex Parte at 2. Diaspora is an
open-source, social networking software that provides a decentralized, peer-to-peer alternative to
commercial alternatives such as Facebook and LinkedIn by allowing participants to retain ownership of all
the material they use on the site, and retain full control over how that information is shared. See
https://joindiaspora.com/; see also
http://www.pcworld.com/businesscenter/article/211526/opensource_social_network_diaspora_goes_live.ht
ml. BitTorrent is a peer-to-peer, closed software program that allows end users to upload or download files
and to share files with each other on a distributed basis. See http://www.bittorrent.com/.
183 On the other hand, provision of client software such as Microsoft Outlook is not provision of ACS.
While consumers use such client software to manage their ACS, the client software standing alone does not
provide ACS.
184 We also disagree with COAT's suggestion that ACS used with an online directory would not be
covered. COAT Sept. 28 Ex Parte at 2. While online directories are excluded from coverage under the
limited liability provisions in Section 2(a)(2) of the CVAA, the ACS used with such directories are
covered.
35

Federal Communications Commission

FCC 11-151

87.
We disagree with Verizon's assertion that the requirement in Section
716(e)(1)(C) that the Commission shall "determine the obligations under this section of
manufacturers, service providers, and providers of applications or services accessed over
service provider networks"185 compels the conclusion that developers of applications have
their own independent accessibility obligations.186 We note that the regulations that the
Commission must promulgate pursuant to Section 716(e) relate to the substantive
requirements of the Act found in Sections 716(a)-(d) encompassing accessibility (716(a)
and 716(b)); compatibility (716(c)); and network features, functions, and capabilities
(716(d)). Each of these obligations applies to manufacturers of ACS equipment and/or
providers of ACS. There are no independent substantive requirements in these sections
that apply to "providers of applications or services accessed over service provider
networks." We believe the most logical interpretation of this phrase is the one proposed
in the NPRM: that providers of advanced communications services include entities that
provide advanced communications services over their own networks as well as providers
of applications or services accessed (i.e., downloaded and run) by users over other service
providers' networks.187 We adopt this interpretation today, which we believe comports
with our analysis above that providers of ACS are responsible for ensuring the
accessibility of the underlying components of the service, including the software
applications, to the extent that doing so is achievable.
88.
We find, however, that a provider of advanced communications services is
not responsible for the accessibility of third-party applications and services that are not
components of its service and that the limitations on liability in Section 2(a) of the
CVAA generally preclude such service provider liability.188 This approach is consistent
with commenters that argue that service providers and manufacturers should be
responsible only for those services and applications that they provide to consumers.189
They explain that they have no control over third party applications that consumers add


185 47 U.S.C. 716(e)(1)(C) (emphasis added).
186 Verizon Comments at 3-4.
187 Accessibility NPRM, 26 FCC Rcd at 3144, 27. See also IT and Telecom RERCs at 6-7; Words+ and
Compusult Comments at 10. Other commenters assert that aggregators and resellers should also be
covered. See Consumer Groups Comments at 5; AFB Reply Comments at 3-4.
188 See, e.g., AT&T Comments at 8-9; CTIA Comments at 10; Microsoft Comments at 12; NetCoalition
Comments at 4; Verizon Comments at 3-4; Words+ and Compusult Comments at 10. CTIA also notes that
Section 2(a) exempts from liability providers of networks over which advanced communications services
are accessed. CTIA Comments at 10-11. See also Senate Report at 5; House Report at 22 ("Section 2
provides liability protection where an entity is acting as a passive conduit of communications made
available through the provision of advanced communications services by a third party . . ."). See also T-
Mobile Comments at 4 (service providers like T-Mobile are not responsible for the accessibility of third-
party services and applications); NCTA Reply Comments at 2-3 (networks, acting as conduits, are not
liable for the accessibility of services that travel over their networks); T-Mobile Reply Comments at 6. See
also
Network Features, Section III.A.4.c, and Accessibility of Information Content, Section III.A.4.d, infra,
discussing other obligations of providers of advanced communications and network services.
189 See, e.g., AT&T Comments at 8; CTIA Comments at 10; Microsoft Comments at 12-13; NetCoalition
Comments at 4-5; Verizon Comments at 3-4.
36

Federal Communications Commission

FCC 11-151

on their own and that such third party applications have the potential to significantly alter
the functionality of devices.190 Notwithstanding that conclusion and consistent with
Section 2(b) of the CVAA, we also agree with commenters that the limitation on liability
under Section 2(a) does not apply in situations where a provider of advanced
communications services relies on a third-party application or service to comply with the
accessibility requirements of Section 716.191
89.
We also confirm that providers of advanced communications services may
include resellers and aggregators,192 which is consistent with the approach the
Commission adopted in the Section 255 Report and Order.193 Several commenters
support that conclusion.194 We disagree with Verizon's suggestion that, to the extent that
a carrier is strictly reselling an advanced communications service as is (without
alteration), the sole control of the features and functions rests with the underlying service
provider, not the reseller, and the reseller should not have independent compliance
obligations.195 To the extent that the underlying service provider makes those services
accessible to and usable by individuals with disabilities in accordance with the CVAA
mandates, those services should remain accessible and usable when resold as is (without
alteration). Resellers offer services to consumers who may or may not be aware of the
identity of the underlying service provider. It is both logical and in keeping with the
purposes of the CVAA for consumers to be able to complain against the provider from
whom they obtain a service, should that service be inaccessible. While a reseller may not
control the features of the underlying service, it does have control over its decision to
resell that service. Its obligation, like that of any other ACS provider, is to ensure that the
services it provides are accessible, unless that is not achievable.
90.
Because the networks used for advanced communications services are
interstate in nature, and the utilization of equipment, applications and services on those
networks are also interstate in nature, we conclude that the phrase "in or affecting
interstate commerce" should be interpreted broadly.196 Nonetheless, the IT and Telecom
RERCs suggest that an entity that has its own network "completely off the grid, that it


190 See, e.g., AT&T Comments at 8-9; Microsoft Comments at 13.
191 CTIA Comments at 10; Verizon Comments at 4. See also Pub. L. No. 111-260, 2(b).
192 "Aggregator" is defined as "any person that, in the ordinary course of its operations, makes telephone
services available to the public or to transient users of its premises, for interstate telephone calls using a
provider of operator services." 47 U.S.C. 226(a)(2).
193 "[W]ith respect to section 255, Congress intended to use the term `provider' broadly, to include all
entities that make telecommunications services available." Section 255 Report and Order, 16 FCC Rcd at
6450, 80. The Commission explained that an aggregator is a "provider of telecommunications service,"
even though 47 U.S.C. 153(50) excludes aggregators from the definition of "telecommunications carrier."
Section 255 Report and Order, 16 FCC Rcd at 6450, 80.
194 See, e.g., Consumer Groups Comments at 5-6; IT and Telecom RERCs Comments at 5; Words+ and
Compusult Comments at 9. But see Verizon Comments at 4-5.
195 Verizon Comments at 4-5.
196 See IT and Telecom RERCs Comments at 7.
37

Federal Communications Commission

FCC 11-151

creates and maintains, and that does not at any time connect to another grid" would not
be covered.197 We agree that advanced communication services that are available only on
a private communications network that is not connected to the Internet, the public
switched telephone network ("PSTN"), or any other communications network generally
available to the public may not be covered when such services are not "offered in or
affecting interstate commerce." An example of a private communications network is a
company internal communications network. Nonetheless, where such providers of
advanced communications services are not covered by Section 716, they may have
accessibility obligations under other disability related statutes, such as Section 504 of the
Rehabilitation Act of 1973198 or the Americans with Disabilities Act of 1990.199
4.

General Obligations

91.
Section 716(e)(1)(C) of the Act requires the Commission to "determine
the obligations...of manufacturers, service providers, and providers of applications or
services accessed over service provider networks."200 Below, we discuss the obligations
of manufacturers and service providers, including the obligations of providers of
applications or services accessed over service provider networks.
a.

Manufacturers and Service Providers

92.
Background. With respect to equipment manufacturers and service
providers of ACS, the Commission proposed in the Accessibility NPRM to adopt general
obligations that mirror the language of the statute, similar to the approach taken in
sections 6.5 and 7.5 of the Commission's Section 255 rules.201 The Commission also
proposed to adopt requirements similar to those in its Section 255 rules regarding product
design, development, and evaluation (sections 6.7 and 7.7); information pass through
(sections 6.9 and 7.9); and information, documentation and training (sections 6.11 and
7.11), modified to reflect the statutory requirements of Section 716.202
93.
Discussion. As set forth below, we adopt into our rules the general
obligations contained in Sections 716(a)-(e).203 As the Commission did in the Section
255 Report and Order
, we find that a functional approach will provide clear guidance to
covered entities regarding what they must do to ensure accessibility and usability.204


197 IT and Telecom RERCs Comments at 7. See also ITI Comments at 22 ("A service is an offering to
others
; it is not software or a functionality developed by an entity solely for internal use. Accordingly, a
system that is developed by an individual or organization and not sold to the public cannot be considered
covered by the CVAA").
198 See 29 U.S.C. 794.
199 See 42 U.S.C. 12101-12213; see also ITI Comments at 21.
200 47 U.S.C. 617(e)(1)(C).
201 Accessibility NPRM, 26 FCC Rcd at 3170, 100.
202 Accessibility NPRM, 26 FCC Rcd at 3170-3171, 101-102.
203 See 47 U.S.C. 716(a) (e).
204 See Section 255 Report and Order, 16 FCC Rcd at 6429-6430, 22.
38

Federal Communications Commission

FCC 11-151

Consistent with AFB's comments, we modify our rules as proposed to make clear that
any third party accessibility solution that a covered entity uses to meet its accessibility
obligations must be "available to the consumer at nominal cost and that individuals with
disabilities can access."205

With respect to equipment manufactured after the effective date of the
regulations, a manufacturer of equipment used for advanced communications
services, including end user equipment, network equipment, and software, must
ensure that the equipment and software that such manufacturer offers for sale or
otherwise distributes in interstate commerce shall be accessible to and usable by
individuals with disabilities, unless such requirements are not achievable.206

With respect to services provided after the effective date of the regulations, a
provider of advanced communications services must ensure that services offered
by such provider in or affecting interstate commerce are accessible to and usable
by individuals with disabilities, unless such requirements are not achievable.207

If accessibility is not achievable either by building it into a device or service or by
using third-party accessibility solutions available to the consumer at nominal cost
and that individuals with disabilities can access, then a manufacturer or service
provider shall ensure that its equipment or service is compatible with existing
peripheral devices or specialized customer premises equipment commonly used
by individuals with disabilities to achieve access, unless such compatibility is not
achievable.208
Providers of advanced communications services shall not install network features,
functions, or capabilities that impede accessibility or usability.209
Advanced communications services and the equipment and networks used to
provide such services may not impair or impede the accessibility of information
content when accessibility has been incorporated into that content for
transmission through such services, equipment, or networks.210
94.
We further adopt in our rules the following key requirements, supported
by the IT and Telecom RERCs,211 with some non-substantive modifications to clarify the
rules proposed in the Accessibility NPRM.212 These requirements are similar to sections


205 AFB Comments at 3; AAPD Reply Comments at 3.
206 See 47 U.S.C. 617(a)(1).
207 See 47 U.S.C. 617(b)(1).
208 See 47 U.S.C. 617(c).
209 See 47 U.S.C. 617(d).
210 See 47 U.S.C. 617(e)(1)(B).
211 IT and Telecom RERCs Comments at 33.
212 Accessibility NPRM, 26 FCC Rcd at 3170-71, 101.
39

Federal Communications Commission

FCC 11-151

6.7 6.11 of our Section 255 rules213 but are modified to reflect the statutory
requirements of Section 716:

Manufacturers and service providers must consider performance objectives at the
design stage as early and as consistently as possible and must implement such
evaluation to the extent that it is achievable.

Manufacturers and service providers must identify barriers to accessibility and
usability as part of such evaluation.214

Equipment used for advanced communications services must pass through cross-
manufacturer, nonproprietary, industry-standard codes, translation protocols,
formats, or other information necessary to provide advanced communications
services in an accessible format, if achievable. Signal compression technologies
shall not remove information needed for access or shall restore it upon
decompression.

Manufacturers and service providers must ensure access by individuals with
disabilities to information and documentation it provides to its customers, if
achievable. Such information and documentation includes user guides, bills,
installation guides for end user devices, and product support communications, in
alternate formats, as needed. The requirement to provide access to information
also includes ensuring that individuals with disabilities can access, at no extra
cost, call centers and customer support regarding both the product generally and
the accessibility features of the product.215
b.

Providers of Applications or Services Accessed over
Service Provider Networks

95.
Background. Section 716(e)(1)(C) requires the Commission to
"determine the obligations under . . . section [716] of manufacturers, service providers,
and providers of applications or services accessed over service provider networks."216 In
the Accessibility NPRM, the Commission sought comment on what, if any, obligations it
should impose on providers of applications or services accessed over service provider
networks.217 The Commission also sought comment on the meaning of the phrase


213 See 47 C.F.R. 6.7 6.11.
214 Samuelson-Glushko TLPC argues that "[u]ser testing requirements are vital to ensure usable and viable
technology access to citizens with disabilities." Samuelson-Glushko Reply Comments at 4. While we will
not impose specific user testing requirements, we support the practice of user testing and agree with
Samuelson-Glushko that user testing benefits individuals with a wide range of disabilities. Samuelson-
Glushko Reply Comments at 4-5.
215 The IT and Telecom RERCs urge that all information provided with or for a product be available online
in accessible form. IT and Telecom RERCs Comments at 33. Although we will not require manufacturers
and service providers to build websites, to the extent that they provide customer support online, such
websites must be accessible, if achievable.
216 47 U.S.C. 617(e)(1)(C).
217 Accessibility NPRM, 26 FCC Rcd at 3144, 3171, 27, 103.
40

Federal Communications Commission

FCC 11-151

"accessed over service provider networks" and how it applies to applications and services
that are downloaded and then run as either native or web applications on the device or to
those applications and services accessed through cloud computing.218
96.
Discussion. As noted previously, to the extent they provide advanced
communications services, "providers of applications or services accessed over service
provider networks" are "providers of advanced communications services" and have the
same obligations when those services are accessed over the service provider's own
network or over the network of another service provider.219 No party suggested that any
additional obligations apply to this subset of providers of ACS, and we do not adopt any
today.220
c.

Network Features

97.
Background. According to Section 716(d) of the Act, "[e]ach provider of
advanced communications services has the duty not to install network features, functions,
or capabilities that impede accessibility or usability."221 In the Accessibility NPRM, the
Commission proposed incorporating Section 716(d)'s requirements into the
Commission's rules, as the Commission's Section 255 rules reflect the cognate language
in Section 251(a)(2).222 Both the Senate and House Reports state that the obligations
imposed by Section 716(d) "apply where the accessibility or usability of advanced
communications services were incorporated in accordance with recognized industry
standards."223 In the Accessibility NPRM, the Commission sought comment on whether it
should "refrain from enforcing these obligations on network providers" until the
Commission identifies and requires the use of industry-recognized standards.224
98.
Discussion. As proposed in the Accessibility NPRM, we adopt rules that
include the requirements set forth in Section 716(d), just as our Section 255 rules reflect
the language in Section 251(a)(2). Commenters generally agree that the duty not to
impede accessibility is comparable to the duty set forth in Section 251(a)(2) of the Act.225
99.
As stated above, this obligation applies when the accessibility or usability
of ACS is incorporated in accordance with recognized industry standards.226 We agree
with industry and consumer commenters that suggest that stakeholder working groups


218 Accessibility NPRM, 26 FCC Rcd at 3171, 103.
219 See Providers of Advanced Communications Services, Section III.A.3, supra.
220 But see para. 86, supra.
221 See 47 U.S.C. 617(d).
222 Accessibility NPRM, 26 FCC Rcd at 3168, 92.
223 Senate Report at 8; House Report at 25.
224 Accessibility NPRM, 26 FCC Rcd at 3168, 93; CTIA Comments to October Public Notice at 15.
225 AAPD Reply Comments to October Public Notice at 4; AFB Reply Comments to October Public Notice
at 5; Verizon Comments to October Public Notice at 5.
226 See Senate Report at 8; House Report at 25.
41

Federal Communications Commission

FCC 11-151

should be involved in developing new accessibility standards.227 As explained in the next
section, we believe that there are several potential mechanisms to develop these
standards.228 Accordingly, we recommend that stakeholders either use existing working
groups or establish new ones to develop standards that will ensure accessibility as the
industry applies network management practices, takes digital rights management
measures, and engages in other passive or active activities that may impede
accessibility.229 We do not agree, however, that we should wait to require compliance
with our rules governing network features until an industry working group "formulates
and offers such standards for the industry."230 We agree with ACB that "existing
standards and expertise will ensure that manufacturers have sufficient functional
approaches" on which to base accessibility and that "[f]urther experience and products
will improve this process."231 We believe this approach provides certainty through the
use of recognized industry standards while at the same time recognizing the importance
of not unnecessarily delaying the development of accessibility solutions.
d.

Accessibility of Information Content

100.
Background. Section 716(e)(1)(B) of the Act states that the Commission's
regulations shall "provide that advanced communications services, the equipment used
for advanced communications services, and networks used to provide [such services] may
not impair or impede the accessibility of information content when accessibility has been
incorporated into that content for transmission through [such services, equipment or
networks]."232 The legislative history of the CVAA makes clear that these requirements
apply "where the accessibility of such content has been incorporated in accordance with
recognized industry standards."233 In the October Public Notice, the Bureaus sought
comment on how Section 716(e)(1)(B) of the Act should be implemented and the types
and nature of information content that should be addressed.234 Several commenters
stressed the importance of developing industry-recognized standards to ensure the
delivery of information content.235 In the Accessibility NPRM, the Commission sought
further comment on developing industry-recognized standards and how they should be
reflected in the Commission's rules, subject to the limitation on mandating technical


227 CTIA Comments at 29; IT and Telecom RERCs Comments at 30.
228 See Accessibility of Information Content, Section III.A.4.d, infra.
229 CTIA Comments at 29; CEA Comments at 30-31; Consumer Groups Comments at 22; IT and Telecom
RERCs Comments at 29-30; T-Mobile Comments at 12; CTIA Reply Comments at 25-26; T-Mobile Reply
Comments at 13-14.
230 ACB Reply Comments at 37. But see CTIA Comments at 29.
231 ACB Reply Comments at 38.
232 47 U.S.C. 617(e)(1)(B).
233 Senate Report at 8; House Report at 25.
234 October Public Notice at 4.
235 CEA Comments to October Public Notice at 14; T-Mobile Comments to October Public Notice at 5;
CTIA Reply Comments to October Public Notice at 16.
42

Federal Communications Commission

FCC 11-151

standards in Section 716(e)(1)(D).236 In particular, the Commission sought comment on
the RERC-IT proposal that our regulations need to ensure that (i) "the accessibility
information (e.g., captions or descriptions) are not stripped off when information is
transitioned from one medium to another;"237 (ii) "parallel and associated media channels
are not disconnected or blocked;"238 and (iii) "consumers . . . have the ability to combine
text, video, and audio streaming from different origins."239 The Commission also sought
comment on the best way it could ensure that encryption and other security measures do
not thwart accessibility,240 while at the same time ensuring that it promotes "network
security, reliability, and survivability in broadband networks."241
101.
Discussion. As proposed in the Accessibility NPRM, we adopt a rule
providing that "advanced communications services and the equipment and networks used
with these services may not impair or impede the accessibility of information content
when accessibility has been incorporated into that content for transmission through such
services, equipment or networks."242 This rule incorporates the text of Section
716(e)(1)(B) and is also consistent with the Commission's approach in the Section 255
Report and Order
.243 We believe that this rule is broad enough to disapprove of
accessibility information being "stripped off when information is transitioned from one
medium to another" and thus find it unnecessary to add this specific language in the rule
itself, as originally suggested by the IT and Telecom RERCs.244


236 Accessibility NPRM, 26 FCC Rcd at 3169, 96.
237 Accessibility NPRM, 26 FCC Rcd at 3169, 96 (citing RERC-IT Comments to October Public Notice at
7). At the public notice stage, Gregg Vanderheiden first filed comments for RERC-IT but all subsequent
fillings (reply comments at the public notice stage and comments and reply comments at the NPRM stage)
were filed under the collective name of the IT and Telecom RERCs. In their Comments to the NPRM, the
IT and Telecom RERCs modified section (i) of its original proposal to read "the accessibility information
(e.g., captions or descriptions) are not stripped off when information is transitioned from one medium to
another using industry standards" (emphasis added).
238 Accessibility NPRM, 26 FCC Rcd at 3169, 96.
239 Accessibility NPRM, 26 FCC Rcd at 3169, 96.
240 Accessibility NPRM, 26 FCC Rcd at 3169, 96 (citing ACB Reply Comments to October Public Notice
at 19).
241 Accessibility NPRM, 26 FCC Rcd at 3169, 96 (citing T-Mobile Comments to October Public Notice at
5).
242 47 U.S.C. 617(e)(1)(B); Accessibility NPRM, 26 FCC Rcd at 3197, Appendix B: Proposed Rules.
243 In our Section 255 Report and Order, the Commission added section 6.9 "Information pass through" to
the Commission's rules, which states:
Telecommunications equipment and customer premises equipment shall pass through cross-
manufacturer, non-proprietary, industry-standard codes, translation protocols, formats or other
information necessary to provide telecommunications in an accessible format, if readily
achievable. In particular, signal compression technologies shall not remove information needed
for access or shall restore it upon decompression. 47 C.F.R. 6.9.
244 IT and Telecom RERCs Comments at 31. The IT and Telecom RERCs subsequently filed an ex parte
reframing and clarifying its initial comments regarding the definition of accessibility of information
(continued....)
43

Federal Communications Commission

FCC 11-151

102.
The legislative history of the CVAA makes clear that the requirement not
to impair or impede the accessibility of information content applies "where the
accessibility of such content has been incorporated in accordance with recognized
industry standards."245 We agree with the IT and Telecom RERCs that sources of
industry standards include: (1) international standards from an international standards
body; (2) standards created by other commonly recognized standards groups that are
widely used by industry; (3) de-facto standards created by one company, a group of
companies, or industry consortia that are widely used in the industry.246 We believe that
these examples illustrate the wide range of recognized industry standards available that
can provide guidance to industry without being overly broad or requiring covered entities
to engineer for proprietary networks. We therefore decline to adopt CEA's proposal that
"recognized industry standards are only those developed in consensus-based, industry-
led, open processes that comply with American Standards Institute ("ANSI") Essential
Requirements."247
103.
At this time, we are unable to incorporate any aspects of the Access Board
criteria or the WCAG into our rules relating to accessibility of information content.
Because the Access Board's process for developing guidelines is still not complete,248 we
believe that it would be premature and inefficient to adopt them at this juncture. We
acknowledge, however, that the IT and Telecom RERCs support the WCAG developed
by the W3C and argue that "these web standards in the proposed Access Board revisions
to 508 and 255 ... should definitely be incorporated in the rules."249 Because technology
is changing so quickly, we encourage stakeholders to use existing or form new working
groups to develop voluntary industry-wide standards, including on issues such as
encryption and other security measures.250 We will monitor industry progress on these
issues and evaluate the Access Board guidelines when they are finalized to determine
whether any amendments to our rule might be appropriate.
(Continued from previous page)


content. See Letter from Gregg Vanderheiden, Director IT Access RERC, Co-Director
Telecommunications Access RERC, Trace R&D Center, University of Wisconsin-Madison, to Marlene H.
Dortch, Secretary, FCC, CG Docket No. 10-213, at 1-3 (filed June 17, 2011) ("IT and Telecom RERCs
June 17 Ex Parte"). In the accompanying Further Notice, we seek comment on the IT and Telecom
RERCs' specific recommendations regarding how we should interpret and apply the rule.
245 Senate Report at 8; House Report at 25.
246 IT and Telecom RERCs June 17 Ex Parte at 4.
247 CEA Comments at 32.
248 See CEA Comments at 33-34.
249 IT and Telecom RERCs Comments at 31. The WCAG are technical specifications developed by
industry, disability, and government stakeholders for those who develop web content, web authoring tools,
and web accessibility evaluation tools. See http://www.w3.org/WAI/intro/wcag.php (viewed on September
16, 2011). As such, we believe it may be appropriate to consider the WCAG an "industry recognized
standard" for purposes of applying our rule (i.e., the requirements of our rule would apply where the
accessibility of the content has been incorporated consistent with WCAG specifications), rather than
incorporating aspects of the WCAG into our rules.
250 IT and Telecom RERCs Comments at 30-31.
44

Federal Communications Commission

FCC 11-151

104.
Finally, we agree with CEA and the IT and Telecom RERCs that,
consistent with the CVAA's liability limitations, manufacturers and service providers are
not liable for content or embedded accessibility content (such as captioning or video
description) that they do not create or control.251
5.

Phased in Implementation

105.
Background. Section 716(e) of the CVAA requires the Commission,
within one year of the date of enactment of the CVAA, to promulgate regulations
implementing Section 716. The accessibility requirements of the CVAA apply to
"equipment manufactured after the effective date of the [applicable] regulations" and to
"services provided after the effective date of the [applicable] regulations."252 The
recordkeeping and annual certification requirements contained in Section 717 of the
CVAA take effect "one year after the effective date" of the regulations that implement
Section 716.253
106.
Discussion. The responsibilities of manufacturers and service providers
begin on the effective date of this Report and Order and are both prospective and
continuing.254 First, the regulations we set forth herein will be effective 30 days after
publication in the Federal Register, except for those rules related to recordkeeping and
certification. Next, the rules governing recordkeeping and certification will become
effective after Office of Management and Budget ("OMB") approval, but, as discussed
above,255 no earlier than one year after the effective date of our regulations implementing
Section 716.
107.
As several commenters recommend,256 we are phasing in the requirements
created by the CVAA for covered entities. Beginning on the effective date of these
regulations, we expect covered entities to take accessibility into consideration during the
design or redesign process for new equipment and services. Covered entities'
recordkeeping obligations become effective one year from the effective date of the rules
adopted herein. By October 8, 2013, covered entities must be in compliance with all of
the rules adopted herein. We find that phasing in these obligations is appropriate due to
the need for covered entities to implement accessibility features early in product
development cycles,257 the complexity of these regulations,258 and our regulations' effects


251 CEA Comments to October Public Notice at 14; IT and Telecom RERCs Comments at 31-32.
252 47 U.S.C. 617(a)(1) and (b)(1).
253 47 U.S.C. 618(a)(5)(A).
254 See Section 255 Report and Order, 16 FCC Rcd at 6447, 71.
255 See para. 105, supra.
256 See CEA Comments at 39-40; Verizon Comments at 2-3; VON Coalition Comments at 8; CEA Reply
Comments at 3-4; CTIA Reply Comments at 4-5; ESA Reply Comments at 22; T-Mobile Reply Comments
at 4; TIA Sept. 28 Ex Parte at 2; Letter from Scott K. Bergmann, Assistant Vice President, Regulatory
Affairs, CTIA The Wireless Association, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213,
at 1 (filed September 30, 2011) ("CTIA Sept. 30 Ex Parte").
257 ESA Reply Comments at 5; IT and Telecom RERCs Reply Comments at 2.
45

Federal Communications Commission

FCC 11-151

on previously unregulated entities. As CEA and ITI have stated, we have utilized phase-
in periods previously in similarly complex rulemakings.259 Below, we discuss details of
the phase-in process.
108.
Beginning on the effective date of these regulations, we expect covered
entities to take accessibility into consideration as early as possible during the design or
redesign process for new and existing equipment and services and to begin taking steps to
"ensure that [equipment and services] shall be accessible to and usable by individuals
with disabilities, unless... not achievable [as determined by the four achievability
factors.]"260 As part of this evaluation, manufacturers and service providers must identify
barriers to accessibility and usability.261
109.
Beginning one year after the effective date of these regulations, covered
entities recordkeeping obligations will become effective.262 As we further explain below,
we require covered entities to keep and maintain records in the ordinary course of
business that demonstrate that the advanced communications products and services they
sell or otherwise distribute are accessible to and usable by individuals with disabilities or
demonstrate that it was not achievable for them to make their products or services
accessible.263
110.
Beginning on October 8, 2013, products or services offered in interstate
commerce must be accessible, unless not achievable, as defined by our rules. Several
(Continued from previous page)


258 T-Mobile Reply Comments at 4.
259 CEA Reply Comments at 4 (citing Closed Captioning Requirements for Digital Television Receivers,
Report and Order, 15 FCC Rcd 16788, 16807, 56 (2000); Wireless E911 Location Accuracy
Requirements
, Report and Order, 22 FCC Rcd 20105, 20112 17 (2007), voluntarily vacated, Rural
Cellular Ass'n v. FCC
, 2008 U.S. App. LEXIS 19889 (D.C. Cir. Sept. 17, 2008)); ITI Comments at 19
(citing 47 C.F.R. 15.119(a); 47 C.F.R. 15.120(a); 47 C.F.R. 15.122(a)(1); 47 C.F.R. 15.117(i)(1)(i)-
(iii)); CEA Ex Parte in CG Docket No. 10-213 at 2 (citing Technical Requirements to Enable Blocking of
Video Programming based on Program Ratings
, Report and Order, 13 FCC Rcd 11248, 11257 23 (1998);
Implementation of Section 304 of the Telecommunications Act of 1996, Report and Order, 13 FCC Rcd
14775, 14803 69 (1998); Section 68.4(a) of the Commission's Rules Governing Hearing Aid-Compatible
Telephones
, Report and Order, 18 FCC Rcd 16753, 16780 65 (2003) ("Hearing Aid Compatibility
R&O"
)).
260 47 U.S.C. 617(a)(1) and (b)(1). See also CTIA Comments at 17; ESA Reply Comments at 5.
261 See Accessibility NPRM, 26 FCC Rcd at 3170, 101.
262 47 U.S.C. 618(a)(5)(A). We note that certain information collection requirements related to
recordkeeping adopted herein are subject to the Paperwork Reduction Act and will be submitted to the
OMB for review. Those requirements will become effective after OMB approval but no earlier than one
year after the effective date of rules promulgated pursuant to Section 716(e). After OMB approval is
obtained, the Consumer and Governmental Affairs Bureau will issue a public notice instructing covered
entities when and how to file their annual certification that records are being maintained in accordance with
the statute and the rules adopted herein.
263 Recordkeeping requirements apply to manufacturers and service providers subject to 47 U.S.C. 255,
617 and 619.
46

Federal Communications Commission

FCC 11-151

commenters have called for at least a two-year phase-in period for these regulations.264
By October 8, 2013, we expect that manufacturers and service providers will be
incorporating accessibility features deep within many of their most complex offerings,
instead of patching together ad-hoc solutions shortly before enforcement begins.265 Some
commenters are concerned that a long phase-in period will leave individuals with
disabilities waiting for access to new technologies.266 Although AAPD is correct that
many covered entities have been aware of the existence of this rulemaking,267 the specific
rules were not in place until now. The Commission is also cognizant of the fact that our
new implementing regulations will touch entities not traditionally regulated by this
Commission. A phase-in date of October 8, 2013 will give all covered entities the time to
incorporate their new obligations into their development processes.268 A two-year phase-
in period is also consistent with the Commission's approach in other complex
rulemakings, as shown in the chart below:

Commission Proceeding

Phase-in Period

CVAA
2 years
Closed Captioning Requirements for Digital Television269
2 years


264 See CEA Comments at 39-40; Verizon Comments at 2-3; VON Coalition Comments at 8; CEA Reply
Comments at 3-4; CTIA Reply Comments at 4-5; ESA Reply Comments at 22; T-Mobile Reply Comments
at 4; CTIA Sept. 30 Ex Parte at 1; TIA Sept. 28 Ex Parte at 2.
265 See CEA Reply Comments at 5; IT and Telecom RERCs Reply Comments at 2.
266 See, e.g., AAPD Reply Comments at 3-4 (proposing a one-year phase-in period); Letter from Paul W.
Schroeder, Vice President, Programs and Policy, AFB, and Mark D. Richert, Director Public Policy, AFB,
to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 1-2 (filed September 28, 2011) ("AFB
Sept. 28 Ex Parte"); Letter from Andrew S. Phillips, Policy Attorney, National Association of the Deaf, to
Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 3 (filed September 28, 2011) ("NAD Sept.
28 Ex Parte"). See also IT and Telecom RERCs Reply Comments at 4-5.
267 AAPD Reply Comments at 3-4.
268 We believe two years to be consistent with complex consumer electronics development cycles. See, e.g.
Amendment of the Commission's Rules Governing Hearing Aid-Compatible Mobile Handsets,
WT Docket
No. 07-250, Policy Statement and Second Report and Order and Further Notice of Proposed Rulemaking,
25 FCC Rcd 11167, 11185, 49, 50 (2010) (Hearing Aid Compatibility FNPRM).
269 Closed Captioning Requirements for Digital Television Receivers, Report and Order, 15 FCC Rcd
16788, 16807, 56 (2000).
47

Federal Communications Commission

FCC 11-151

E911 Location Accuracy Requirements270
5 years
V-chip Implementation271
2 years
Wireless Hearing Aid Compatibility Implementation272
4.5 years
111.
Also beginning October 8, 2013, the requirements we discuss elsewhere
regarding peripheral device compatibility273 and pass-through of industry standard codes
and protocols274 come into effect. The obligation not to impair or impede accessibility or
the transmission of accessibility information content through the installation of network,
features, functions, or capabilities as clarified above275 also begins October 8, 2013. We
also expect covered entities to provide information and documentation about their
products and services in accessible formats, as explained earlier, beginning October 8,
2013.276
112.
In addition, on October 8, 2013, consumers may begin filing complaints.
Prior to that date, the Commission will issue a public notice describing how consumers
may file a request for dispute assistance with the CGB Disability Rights Office and
informal complaints with the Enforcement Bureau.277 Formal complaints must be filed in
accordance with the rules adopted in this Report and Order.278 While the CVAA
complaint process will not be available to consumers until 2013, we remind industry that
it has a current obligation to ensure that telecommunications services and equipment are
accessible to and usable by individuals with disabilities. Consumers may file complaints
at any time under our existing informal complaint procedures alleging violations of the
accessibility requirements for telecommunications manufacturers and service providers
under Section 255 of the Communications Act.279 Furthermore, separate from the
complaint process, the Disability Rights Office in CGB will be available to assist
consumers, manufacturers, service providers and others in resolving concerns about the


270 Wireless E911 Location Accuracy Requirements, Report and Order, 22 FCC Rcd 20105, 20112 17
(2007), voluntarily vacated, Rural Cellular Ass'n v. FCC, 2008 U.S. App. LEXIS 19889 (D.C. Cir. Sept.
17, 2008).
271 Technical Requirements to Enable Blocking of Video Programming based on Program Ratings, Report
and Order, 13 FCC Rcd 11248, 11257, 23 (1998).
272 Hearing Aid Compatibility R&O, 18 FCC Rcd at 16780, 65.
273 See Compatibility, Section III.B.3, infra.
274 See Accessibility of Information Content, Section III.A.4.d, supra.
275 See Network Features, Section III.A.4.c, Accessibility of Information Content, Section III.A.4.d, supra.
276 See Manufacturers and Service Providers, Section III.A.4.a, supra.
277 See Informal Complaints, Section III.E.2.c, infra.
278See Formal Complaints, Section III.E.2.d, infra.
279 47 C.F.R. 6.17.
48

Federal Communications Commission

FCC 11-151

accessibility and usability of advanced communications services and equipment as of the
effective date of our rules (i.e., October 8, 2013).280
113.
Since ACS manufacturers and service providers must take accessibility
into account early in the ACS product development cycle beginning on the effective date
of our rules, we anticipate that many ACS products and services with relatively short
development cycles will reach the market with accessibility features well before October
8, 2013.

B.

Nature of Statutory Requirements

1.

Achievable Standard

a.

Definitions

(i)

Accessible to and Usable by

114.
Background. Under Sections 716(a) and (b) of the Act, covered service
providers and equipment manufacturers must make their products "accessible to and
usable by" people with disabilities, unless it is not achievable.281 Section 255 of the Act
requires telecommunications providers and equipment manufacturers to make their
products "accessible to and usable by" people with disabilities if readily achievable.282 In
the Section 255 Report and Order, the Commission adopted definitions of "accessible" in
section 6.3(a) and "usable" in section 6.3(l) of the Commission's rules which
incorporated the functional definitions of these terms from the Access Board
guidelines.283 In the Accessibility NPRM, the Commission sought comment on whether to
continue to define "accessible to and usable by" as it has for its implementation of
Section 255, or to make changes to these definitions, based on the Access Board Draft
Guidelines that were released for public comment in March 2010.284
115.
Discussion. Given that commenters generally agree that the
Commission's definitions of "accessible" and "usable" in sections 6.3(a) and 6.3(l),
respectively, are "well established," we will continue to define "accessible to and usable
by" as the Commission did with regard to implementation of Section 255.285 We agree


280 Consumers may contact the Disability Rights Office by mail, by e-mail to dro@fcc.gov, or by calling
202-418-2517 (voice) or 202-418-2922 (TTY).
281 47 U.S.C. 617(a), (b).
282 47 U.S.C. 255.
283 Accessibility NPRM, 26 FCC Rcd at 3164-3165, 82-83. See 47 C.F.R. 6.3(a) which provides that
"[i]nput, control, and mechanical functions shall be locatable, identifiable, and operable..."
284 Accessibility NPRM, 26 FCC Rcd at 3164-3165, 82-83. See also Access Board Draft Guidelines.
285 CEA Comments at 29; TIA Comments at 33; Verizon Comments at 13; Wireless RERC Comments at 6;
Words+ and Compusult Comments at 29. But see VON Coalition Comments at 7 ("when a company
makes a good faith reasonable effort to incorporate accessibility features in different products across
different lines, it complies with the Act, even if a particular offering is not accessible"). Consistent with
most of the record, in Performance Objectives, Section III.D.1, infra, we adopt the same approach to
implementation that the Commission used with regard to Section 255. In its Reply Comments, the IT and
Telecom RERCs disagree with this approach and argue that the requirements in Part 6 of the Commission's
(continued....)
49

Federal Communications Commission

FCC 11-151

with the Wireless RERC that this approach will "reduce both the potential for
misunderstanding as well as the regulatory cost of compliance" and promote "the
objective of consistency."286 We also plan to draw from the Access Board's guidelines
once they finalize them.287
116.
While we note that there is a great deal of overlap between Section 255's
definition of "accessible" and the criteria outlined in the Access Board Draft Guidelines,
at this time, we are unable to incorporate the Access Board's draft definitions of
"accessible" or "usable" into both our Section 255 rules and our Section 716 rules
because the Access Board's process for developing guidelines is not complete.288 Once
the Access Board Draft Guidelines are complete, the Commission may revisit its
definitions of "accessible" and "usable" and harmonize them with the Access Board's
final definitions, to the extent there are differences.
(ii)

Disability

117.
Background. Section 3(18) of the Act states that the term "disability" has
the meaning given such term under Section 3 of the ADA.289 The ADA defines
"disability" as with respect to an individual: "(A) a physical or mental impairment that
substantially limits one or more major life activities of such individual; (B) a record of
such an impairment; or (C) being regarded as having such an impairment . . ."290 In the
Accessibility NPRM, the Commission sought comment on whether we should incorporate
the ADA's definition of disability in our Section 716 rules.291
118.
Discussion. Having received only one comment292 on this issue and
finding that our current rules incorporate the definition of "disability" from Section 3 of
the ADA, we adopt this definition, as proposed, in our Section 716 rules as well.293 To
provide additional guidance to manufacturers and service providers, as the Commission
did in the Section 255 Report and Order, we note that the statutory reference to
(Continued from previous page)


rules should be reframed as goals and testable performance criteria. IT and Telecom RERCs Reply
Comments at 5. In the Further Notice, we seek comment on the general approach and the specific testable
performance criteria suggested by the IT and Telecom RERCs. See Performance Objectives, Section IV.F,
infra.
286 Wireless RERC Comments at 6. See also Verizon Comments at 13.
287 See further discussion of their guidelines at Compatibility, Section III.B.3; Performance Objectives,
Section III.D.1; Prospective Guidelines, Section III.D.3, infra.
288 CEA Comments at 29; Verizon Comments at 13; TIA Comments at 33.
289 47 U.S.C. 153(18).
290 42 U.S.C. 12102(1).
291 Accessibility NPRM, 26 FCC Rcd at 3165, 84.
292 UC Comments at 22-23 (arguing that the CVAA should apply to people with cognitive disabilities).
293 47 C.F.R. 6.3(d). See also Section 255 Report and Order, 16 FCC Rcd at 6428-6429, 18-20. We
note that Congress amended the ADA in 2008 to clarify the definition of "being regarded as having such an
impairment" and to provide rules of construction regarding the definition of disability. See ADA
Amendments Act of 2008, Pub. L. No. 110-325, 122 Stat. 3553 (2008).
50

Federal Communications Commission

FCC 11-151

"individuals with disabilities" includes people with hearing, vision, movement,
manipulative, speech, and cognitive disabilities.294 The definition of "disability,"
however, is not limited to these specific groups. Determinations of whether an individual
has a disability are decided on a case-by-case basis.
b.

General Approach

119.
Background. The CVAA requires that service providers and
manufacturers meet the accessibility requirements of Section 716 "unless [those
requirements] are not achievable."295 Section 716(g) of the Act defines the term
"achievable" to mean "with reasonable effort or expense, as determined by the
Commission."296 Section 716 imposes a different standard than Section 255.
Specifically, under Section 255, covered entities must ensure the accessibility of their
products and services if it is "readily achievable" to do so, which the statute defines, with
reference to the ADA, to mean "easily accomplishable and able to be carried out without
much difficulty or expense."297
120.
With respect to Section 716(g), the CVAA requires the Commission to
consider the following factors in making determinations about what "constitutes
reasonable effort or expense":
(1) The nature and cost of the steps needed to meet the requirements of
this section [716(g)] with respect to the specific equipment or service in
question.
(2) The technical and economic impact on the operation of the
manufacturer or provider and on the operation of the specific equipment or
service in question, including on the development and deployment of new
communications technologies.
(3) The type of operations of the manufacturer or provider.
(4) The extent to which the service provider or manufacturer in question
offers accessible services or equipment containing varying degrees of
functionality and features, and offered at differing price points.298
121.
The Senate and House Reports both state that the Commission should
"weigh each factor equally when making an achievability determination."299 The House
Report states that, in implementing Section 716, the Commission should "afford


294 See Section 255 Report and Order, 16 FCC Rcd at 6428-6429, 20.
295 47 U.S.C. 617(a)(1), (b)(1). See Accessibility NPRM, 26 FCC Rcd at 3158, 67. In the
accompanying Further Notice we propose to exempt certain small businesses from the requirement to
perform an achievability analysis. See Section IV.A, infra. While that aspect of the Further Notice is
pending, we will apply the small business exemption on an interim basis. See Exemptions for Small
Entities Temporary Exemption of Section 716 Requirements, Section III.C.3, infra.
296 47 U.S.C. 617(g).
297 47 U.S.C. 255(a)(2); 42 U.S.C. 12181(9).
298 47 U.S.C. 617(g).
299 Senate Report at 8; House Report at 25. See Accessibility NPRM, 26 FCC Rcd at 3158, 69.
51

Federal Communications Commission

FCC 11-151

manufacturers and service providers as much flexibility as possible, so long as each does
everything that is achievable in accordance with the achievability factors."300
122.
Discussion. As provided in the CVAA and its legislative history, we
adopt the Commission's proposal in the Accessibility NPRM to limit our consideration of
achievability to the four factors specified in Section 716301 and to weigh each factor
equally302 when considering whether accessibility is not achievable. We agree with AFB
that the CVAA requires covered entities to make their products accessible unless it is
"not achievable" to do so and that the Section 716 standard is different from the Section
255 "readily achievable" standard.303
123.
We will be applying the four achievability factors in the complaint process
in those cases in which a covered entity asserts that it was "not achievable" to make its
equipment or service accessible. Thus, as proposed by AT&T and supported by many of
the commenters,304 we will be taking a flexible, case-by-case approach to the
determination of achievability. We reject the suggestion by Words+ and Compusult that
the Commission should evaluate products and services on a category-by-category
basis.305 The approach suggested by Words+ and Compusult would not be consistent
with the four factors mandated by Congress.306 We also share the concerns expressed by


300 House Report at 24.
301 See CTIA Comments at 24; TechAmerica Comments at 6; TIA Comments at 15; T-Mobile Reply
Comments at 11.
302 See CEA Comments at 21; CTIA Comments at 25; T-Mobile Comments at 9; CEA Reply Comments at
12; T-Mobile Reply Comments at 11.
303 47 U.S.C. 255, 617(g). See AFB Reply Comments at 11. ACB suggests adding seven more factors
to the achievability analysis. These proposed factors, which address the commitment of the manufacturer
or service provider to achieving accessibility, include (1) engagement of upper level executives; (2) the
budgeting process for accessibility as compared to the overall budget; (3) consideration of accessibility
early in the planning process; (4) covered entity devotion of personnel during planning stages to achieving
accessibility; (5) inclusion of people with disabilities in testing; (6) devotion of resources to the needs of
people with disabilities; and (7) record of delivering accessible products and services. ACB Reply
Comments at 25-26. While we do not adopt these as additional achievability factors, we do believe they
are useful guidance that will help covered entities meet their obligations under the statute.
304 AT&T Comments at 9; CEA Comments at 21; TechAmerica Comments at 6; TIA Comments at 15; T-
Mobile Comments at 9. Accord, CTIA Comments at 26 (Commission should interpret the four factors
"with the goal of promoting the development and deployment of new advanced communications services");
CEA Reply Comments at 13; T-Mobile Reply Comments at 10-11.
305 Words+ and Compusult Comments at 21. Words+ and Compusult are concerned that the Commission
will not be able to evaluate the many products that are introduced each year. This will not be necessary,
since the Commission will be evaluating only those products that are the subject of a complaint.
306 See, e.g., Achievable Standard, Section III.B.1, infra, discussing the specific factors the Commission
will consider when determining achievability, including the nature and cost of the steps needed with respect
to the specific equipment or service in question.
52

Federal Communications Commission

FCC 11-151

NFB and supported by the Consumer Groups307 that flexibility should not be so
paramount that accessibility is never achieved.
124.
We note that nothing in the statute limits the consideration of the
achievability of accessibility to the design and development stage. While we believe in
many instances, accessibility is more likely to be achievable if covered entities consider
accessibility issues early in the development cycle, there may be other "natural
opportunities" for consideration of accessibility.308 Natural opportunities to assess or
reassess the achievability of accessibility features may include, for example, the redesign
of a product model or service, new versions of software, upgrades to existing features or
functionalities, significant rebundling or unbundling of product and service packages, or
any other significant modification that may require redesign.309 We agree with Consumer
Groups that new versions of software or services or new models of equipment must be
made accessible unless not achievable and "that this burden is not discharged merely by
having shown that accessibility is not achievable for a previous version or model."310
125.
We expect that accessibility will be considered throughout the design and
development process and that during this time "technological advances or market
changes" may "reduce the effort and/or expense needed to achieve accessibility."311 We
reject CTIA's argument that requiring manufacturers and service providers to reassess the
accessibility of products and services at key development stages would result in
companies refraining from issuing new versions of their products.312 Beyond this
conclusory statement, nothing in the record supports this contention. We note that no
party has asserted that the identical requirement in the Section 255 context hampered
innovation and competition, and there appears to be no reason to believe that it will have
such an impact here.
126.
Consistent with both the Section 255 Report and Order313 and the
legislative history of the CVAA,314 Section 716 does not require manufacturers of
equipment to recall or retrofit equipment already in their inventories or in the field. In
addition, consistent with our Section 255 implementation, cosmetic changes to a product
or service may not trigger a manufacturer or service providers' reassessment.315


307 NFB Reply Comments to October Public Notice at 6; Consumer Groups Comments at 16.
308 See Section 255 Report and Order, 16 FCC Rcd at 6447, 71.
309 If, however, a covered entity is required by the Commission to make the next generation of a product or
service accessible as a result of an enforcement proceeding, an achievability analysis may not be used for
the purpose of determining that such accessibility is not achievable.
310 Consumer Groups Comments at 17. See also Section 255 Report and Order, 16 FCC Rcd at 6447, 71.
311 Consumer Groups Comments at 17; IT and Telecom RERCs Reply Comments at 2.
312 CTIA Reply Comments at 23.
313 Section 255 Report and Order, 16 FCC Rcd at 6448, 73.
314 Senate Report at 9.
315 Section 255 Report and Order, 16 FCC Rcd at 6448, 72.
53

Federal Communications Commission

FCC 11-151

c.

Specific Factors

(i)

Nature and Cost of Steps Needed with Respect to
Specific Equipment or Service

127.
Background. Section 716(g)(1) of the Act states that, in determining
whether the statutory requirements are achievable, the Commission must consider "[t]he
nature and cost of the steps needed to meet the requirements of this section [716(g)] with
respect to the specific equipment or service in question."316 Both the Senate and House
Reports stress the need for the Commission to focus on the specific equipment or service
in question when conducting this analysis.317 The House Report also states that "the
Commission [should] interpret the accessibility requirements in this provision the same
way as it did for Section 255, such that if the inclusion of a feature in a product or service
results in a fundamental alteration of that service or product, it is per se not achievable to
include that feature."318 Accordingly, in the Accessibility NPRM, the Commission sought
comment on its proposal to interpret the achievability requirements consistent with this
directive.319 The Commission also sought comment on whether competing products
should be considered when determining achievability and the totality of the steps a
company needs to take for an achievability analysis.320
128.
Discussion. Consistent with the House Report, we find that if the
inclusion of an accessibility feature in a product or service results in a fundamental
alteration of that product or service, then it is per se not achievable to include that
accessibility function.321 We find that the most appropriate definition of "fundamental
alteration" can be found in the Section 255 Report and Order, where the Commission
defined it to mean "reduce substantially the functionality of the product, to render some
features inoperable, to impede substantially or deter use of the product by individuals
without the specific disability the feature is designed to address, or to alter substantially
and materially the shape, size or weight of the product."322 We caution, however, that in
many cases, features such as voice output can be added in ways that do not fundamentally
alter the product, even if earlier versions of the product did not have that capability.323
Since all accessibility enhancements in one sense require an alteration to the design of a
product or service,324 not all changes to a product or service will be considered


316 47 U.S.C. 617(g)(1). See Accessibility NPRM, 26 FCC Rcd at 3159, 71.
317 Senate Report at 8; House Report at 25.
318 House Report at 24-25.
319 Accessibility NPRM, 26 FCC Rcd at 3158-3159, 69.
320 Accessibility NPRM, 26 FCC Rcd at 3159-3160, 71.
321 See House Report at 24-25. See also CEA Comments at 21; IT and Telecom RERCs Comments at 21;
ITI Comments at 10; NCTA Comments at 6; TechAmerica Comments at 6; TIA Comments at 15.
322 Section 255 Report and Order, 16 FCC Rcd at 6444, 62. See also IT and Telecom RERCs Comments
at 21.
323 See IT and Telecom RERCs Comments at 21.
324 Section 255 Report and Order, 16 FCC Rcd at 6444, 62.
54

Federal Communications Commission

FCC 11-151

fundamental alterations. Rather, the alteration to the product or service must be
fundamental for the accessibility feature to be considered per se not achievable. As we
explained in the Section 255 Report and Order, "the `fundamental alteration' doctrine is a
high standard and . . . the burden of proof rests with the party claiming the defense."325
129.
We disagree with those commenters that argue that we should not consider
whether accessibility has been achieved by competing products in determining whether
accessibility is achievable under this achievability factor.326 Rather, if an accessibility
feature has been implemented for competing products or services, we find that such
implementation may serve as evidence that implementation of the accessibility feature is
achievable.327 To ignore such evidence would deprive the Commission of a key element
of determining whether achievability is possible. We note, however, that a covered entity
may rebut such evidence by demonstrating that the circumstances of the product or
service offered by that particular entity renders the feature not achievable.328 We will
consider all relevant evidence when considering the nature and cost of the steps necessary
to achieve accessibility for the particular device or service for the particular covered
entity.
130.
We also reject CEA's assertion that this factor requires us to consider "the
entire cost of implementing the required accessibility functionality relative to the
production cost of the product."329 Under the first factor, the Commission is required to
consider the cost of the steps needed to meet the requirements of this section with respect
to the specific equipment or service in question. The first factor, however, does not
provide that the costs should be compared to the production cost of the product; indeed,
the factor does not provide for a comparison of the costs at all. As explained further
below, this inquiry more directly fits under the second factor, which examines directly
the economic impact of the cost of the accessibility features.
(ii)

Technical and Economic Impact on the
Operation

131.
Background. The second factor in determining whether compliance with
Section 716 is "achievable" requires the Commission to consider the "technical and
economic impact on the operation of the manufacturer or provider and on the operation of


325 Section 255 Report and Order, 16 FCC Rcd at 6444, 62. Although we are applying the fundamental
alteration doctrine to the achievability analysis as a matter of policy adopted herein, we conform the rule
definition of achievability as proposed in Appendix B of the Accessibility NPRM to the text of the CVAA,
47 U.S.C. 617(g)(1), by deleting the discussion of fundamental alteration from the rule text. See
Appendix B, infra.
326 CEA Comments at 22 (to do otherwise would force standardization on proprietary technologies, in
violation of the CVAA 3 prohibition on mandating proprietary technology); TechAmerica Comments at
7; TIA Comments at 15-16; T-Mobile Comments at 3, 9-10. See also Verizon Comments at 11; CEA
Reply Comments at 12-13; T-Mobile Reply Comments at 10-11.
327 See Words+ and Compusult Comments at 23.
328 See T-Mobile Comments at 10.
329 CEA Comments at 22. See also TechAmerica Comments at 7; Verizon Comments at 11.
55

Federal Communications Commission

FCC 11-151

the specific equipment or service in question, including on the development and
deployment of new communications technologies."330 The Accessibility NPRM sought
comment on ACB's suggestion that the Commission should compare the cost of making
the product accessible with the organization's entire budget when making assessments.331
It also sought comment on how it should take into account the development and
deployment of new communications technologies.332
132.
Discussion. We find that to determine the "economic impact of making a
product or service accessible on the operation of the manufacturer or provider,"333 it will
be necessary to consider both the costs of making a product or service accessible and an
entity's total gross revenues.334 Consistent with the Section 255 Report and Order, we
will consider the total gross revenues of the entire enterprise and will not limit our
consideration to the gross revenues of the particular subsidiary providing the product or
service.335 CEA argues that the Commission should not be able to consider an entity's
entire budget in evaluating the cost of accessibility because Congress dropped from the
final version of the statute a fifth achievability factor which specifically considered "the
financial resources of the manufacturer or provider."336 We disagree. CEA does not
suggest a reason why Congress eliminated this language and does not address the
possibility that Congress may have found the factor to be redundant in light of the fact
that under the second factor we consider the "economic impact on the operation of the
manufacturer or provider."337
133.
We agree with TIA that some new entrants may not initially have the
resources to incorporate particular accessibility features into their products
immediately.338 All covered entities should examine the technical and economic impact
on their operations of achieving accessibility, as stated in the language of Section


330 47 U.S.C. 617(g)(2). See Senate Report at 8; House Report at 25.
331 Accessibility NPRM, 26 FCC Rcd at 3160, 71. See also IT and Telecom RERCs Comments at 22-23
(supports ACB); Words+ and Compusult Comments at 23 (supports ACB); ACB Reply Comments at 25.
While ACB originally made this argument with respect to first factor, for the reasons explained in the
paragraph above, we believe this argument is more appropriately considered under the second factor.
332 Accessibility NPRM, 26 FCC Rcd at 3160, 72.
333 47 U.S.C. 617(g)(2).
334 See TechAmerica Comments at 8; Words+ and Compusult Comments at 23. Cf. ACB Reply Comments
at 27 (accessibility is not achievable if the cost of accessibility as compared to the organization's entire
budget is extraordinary).
335 See Section 255 Report and Order, 16 FCC Rcd at 6445-6447, 70 ("[E]valuate the resources of any
parent company, or comparable entity with legal obligations to the covered entity, but permit any covered
entity (or parent company) to demonstrate why legal or other constraints prevent those resources from
being available to the covered entity.").
336 CEA Comments at 11.
337 47 U.S.C. 617(g)(2).
338 TIA Comments at 16.
56

Federal Communications Commission

FCC 11-151

716(g)(2).339 The need to provide an accessibility feature, however, can have a greater
impact on a smaller entity than a larger one. In other words, the provision of a particular
feature may have negligible impact on a large company but may not be achievable with
reasonable effort or expense for a small business.340
134.
Some commenters argue that the Commission should consider the cost of
implementing accessibility relative to the production cost of the product.341 CEA
suggests that if the cost of accessibility significantly raises the cost of a particular device,
it may result in overpricing the device for consumers, which could result in fewer devices
being purchased.342 Similarly, TechAmerica argues that if the cost of an accessibility
feature exceeds the cost of having the product in the marketplace, then that accessibility
feature is per se not achievable.343 We decline to adopt this per se approach. The
Commission does recognize, however, that if the nature and cost of the steps needed for
accessibility would have a substantial negative technical or economic impact on the
ability to produce a product or service, that fact may be taken into consideration when
conducting the overall achievability analysis. To completely ignore this fact altogether
could discourage manufacturers and service providers from introducing new and
innovative products that, for some reason, would require extremely costly accessibility
features relative to the cost of the product. Congress's balanced approach in the statute,
including its desire to refrain from hampering innovation and investment in technology,
require us to consider the cost of accessibility relative to the cost of producing a product
in certain situations.


339 47 U.S.C. 617(g)(2). See CEA Comments at 24. We reject the proposals that the economic impact
must result in "extraordinary loss of profit" or "undue hardship" for the accessibility feature to be not
achievable. See ACB Reply Comments at 27; Coleman Institute and Samuelson-Glushko TLPC Reply
Comments at 22. These proposals go well beyond the CVAA's definition of "achievable" as meaning
"with reasonable effort or expense." 47 U.S.C. 617(g).
340 For example, a small start up manufacturer may not have the resources to evaluate all the design
considerations that must be considered to make a potential product accessible, even though a larger
manufacturer might have the resources to do so as a matter of course. A smaller service provider looking
for accessible customer premises equipment to provide to its customers may find that the models with
accessibility features are available only to larger service providers, or if they are available to the smaller
provider, the acquisition price is considerably higher than the price for a larger carrier, thereby rendering
such devices cost prohibitive for the smaller provider. Similarly, while a larger service provider may
perform as a matter of course a network upgrade that would include the addition of accessibility features, it
may not be achievable with reasonable effort or expense for a smaller service provider to perform a similar
network upgrade, either because the upgrade is not yet available to the smaller provider or it is cost-
prohibitive to the company at that time.
341 See CEA Comments at 22-23; TechAmerica Comments at 7; Verizon Comments at 11. Such cost
comparisons may be inappropriate given the flexibility permitted under Section 716 to either build the
accessibility feature into every product produced or to rely on third-party solutions made available to
consumers at nominal cost on a per-product basis.
342 CEA Comments at 23.
343 TechAmerica Comments at 8.
57

Federal Communications Commission

FCC 11-151

135.
In its comments, ITI proposes that manufacturers and service providers
should be given the flexibility to make necessary adjustments during the testing stage
prior to fully incorporating accessibility technology. According to ITI, to do otherwise
would result in one set of accessibility features for the beta version of a product, and then
a second, different set of accessibility features for the final version.344 The VON
Coalition argues that manufacturers of devices used for ACS and providers of ACS
should not be subject to the CVAA with respect to products they are testing.345 We find
that, if a covered entity is testing accessibility features along with the other functions of
the product or service, to the extent the beta testing reveals that the accessibility features
need modification to work properly, then under such circumstances, accessibility would
not be fully achievable at the beta stage but would be considered achievable once the
modifications are implemented for the final product design.346 We will not take
enforcement action against a manufacturer or service provider in regard to the
accessibility of products and services that are being beta tested. We will, however,
carefully examine any claim that a product or service is in beta. If it appears that a
covered entity is keeping a product or service in beta testing status and/or making it
available to the general public for extended periods of time as a means of avoiding
accessibility obligations, we will enforce Section 716 with respect to that product or
service.
(iii)

Type of Operations

136.
Background. The third factor in determining whether compliance with
Section 716 is "achievable" requires the Commission to consider "[t]he type of
operations of the manufacturer or provider."347 The Senate and House Reports state that
this factor permits "the Commission to consider whether the entity offering the product or
service has a history of offering advanced communications services or equipment or
whether the entity has just begun to do so."348 The Commission sought comment on the
extent to which it should consider an entity's status as a new entrant in the advanced
communications services market in evaluating achievability and whether the
Commission's analysis would be different if such entity has significant resources or
otherwise appears capable of achieving accessibility.349
137.
Discussion. Consistent with the legislative history,350 we will take into
consideration whether a covered entity has experience in the advanced communications


344 ITI Comments at 22.
345 VON Coalition Sept. 6 Ex Parte at 5.
346 See OnStar Comments at 8; CEA Reply Comments at 5.
347 47 U.S.C. 617(g)(3).
348 Senate Report at 8; House Report at 25-26.
349 Accessibility NPRM, 26 FCC Rcd at 3160, 73.
350 Senate Report at 8; House Report at 25-26.
58

Federal Communications Commission

FCC 11-151

services market or related markets when conducting an achievability analysis.351 We
disagree with Words+ and Compusult's argument that this factor will necessarily provide
a competitive advantage to a new entrant.352 All companies that do not qualify for the
small business exemption, whether new entrants or incumbents, must engage in an
achievability analysis. All companies are required to provide accessibility unless it
cannot be done "with reasonable effort or expense."353 Given the multitude of factors that
affect a company's prospects in the marketplace, we do not see much of a competitive
advantage arising from the ability of a new entrant to assert this third factor as a defense
to a complaint.
138.
The degree to which this factor affects a finding of achievability will
depend upon a number of considerations. We agree with CEA that the Commission
should give little weight to whether a new entrant has experience in other unrelated
markets.354 In this regard, we consider the various telecommunications and information
technology markets to be related. We agree with T-Mobile that because each service
provider has different technical, financial, and personnel resources, with different
business models and distinct technology configurations and platforms, this factor requires
that we look at each company individually when we consider the impact on the operation
of the covered entity of providing the accessibility feature.355
139.
In addition, as suggested by the IT and Telecom RERCs and ACB, when
applying this factor, we will take into consideration the size of the company.356 We agree
that a small start-up company, which may need time to develop its financial resources
and learn the field and its requirements, should be treated differently than a larger
company with the resources available to more rapidly achieve accessibility features.357
While we reject TIA's suggestion that the size of the company should not matter when
applying this factor,358 we agree with TIA that a company's size alone is not a proxy for
determining whether accessibility can be achieved.359 Consistent with the legislative


351See CEA Comments at 24; TechAmerica Comments at 8 (taking into consideration a covered entity's
status as a comparatively new market entrant in the advanced communications services marketplace will
ensure that nascent and groundbreaking products and services are not unnecessarily hindered); TIA
Comments at 16.
352 Words+ and Compusult Comments at 24.
353 47 U.S.C. 617(g).
354 See CEA Comments at 49.
355 T-Mobile Comments at 10.
356 See IT and Telecom RERCs Comments at 23; ACB Reply Comments at 26. As explained in the prior
subsection, we will consider the total gross revenues of the entire enterprise and not limit our consideration
to the gross revenues of the particular subsidiary providing the product or service.
357 See IT and Telecom RERCs Comments at 23.
358 TIA Comments at 16-17.
359 See TIA Comments at 16-17.
59

Federal Communications Commission

FCC 11-151

history, we find that the existence of substantial financial resources does not, by itself,
trigger a finding of achievability.360
(iv)

Extent to which Accessible Services or
Equipment are Offered with Varying
Functionality, Features, and Prices

140.
Background. The fourth factor in determining whether compliance with
Section 716 is "achievable" requires the Commission to consider "[t]he extent to which
the service provider or manufacturer in question offers accessible services or equipment
containing varying degrees of functionality and features, and offered at differing price
points."361 The Senate and House Reports state that "the Commission [should] interpret
this factor in a similar manner to the way that it has implemented its hearing aid
compatibility rules."362 The Commission's rules governing hearing aid compatibility
("HAC") obligations for wireless devices require manufacturers and service providers to
ensure that a range of phones complies with the HAC standards. Specifically, those rules
direct such companies to ensure that hearing aid users are able to select "from a variety of
compliant handset models with varying features and prices."363 Companies are not,
however, required to make all wireless handsets hearing-aid compatible.
141.
In the Accessibility NPRM, the Commission sought comment on whether
covered entities generally should not have to consider what is achievable with respect to
every product, if the entity offers consumers with the full range of disabilities meaningful
choices through a range of accessible products with varying degrees of functionality and
features, at differing price points.364 At the same time, the Commission also sought
comment on whether there are some accessibility features that are so important or easy to
include (like a "nib" on the 5 key)365 that they should be deployed on every product,
unless it is not achievable to do so.366 Finally, the Commission sought comment on


360 See House Report at 25.
361 47 U.S.C. 617(g)(4). See also Senate Report at 8; House Report at 26; Accessibility NPRM, 26 FCC
Rcd at 3160, 74.
362 House Report at 26; Senate Report at 8.
363 Amendment of the Commission's Rules Governing Hearing Aid-Compatible Mobile Handsets, Petition
of American National Standards Institute Accredited Standards Committee C63
, WT Docket No. 07-250,
First Report and Order, 23 FCC Rcd 3406, 3426 51 (2008). The rules also require that manufacturers
meet a "product refresh" mandate that requires the inclusion of hearing aid compatibility in some of their
new models each year. Id. at 3425, 48. The Commission explained that this rule, together with the
requirement for service providers to offer handset models with different functionality levels, was designed
to ensure that consumers would have access to HAC handsets "with the newest features, as well as more
economical models." Id. at 3424, 47.
364 Accessibility NPRM, 26 FCC Rcd at 3161, 76.
365 To help individuals who are visually impaired locate the keys on a standard number pad arrangement,
the 5-key dial pad has a raised nib or projecting point that provides a tactilely discernible home key.
366 Accessibility NPRM, 26 FCC Rcd at 3161-3162, 76.
60

Federal Communications Commission

FCC 11-151

whether it should define with more specificity the meaning of "varying degrees of
functionality and features" and "differing price points."367
142.
Discussion. To satisfy the fourth achievability standard, a covered entity
is required by the CVAA to offer people with each type of disability368 accessibility
features within a line of products that includes the full range of functionality within the
product line as well as a full range of prices within the product line, if achievable.369 We
interpret the plain language of the statute and legislative history to mean that covered
entities generally need not consider what is achievable with respect to every product, if
the entity offers consumers with the full range of disabilities meaningful choices through
a range of accessible products with varying degrees of functionality and features, at
differing price points.370
143.
Furthermore, to satisfy this factor, offering the full range of accessible
products with varying degrees of functionality and features at different price points must
be done effectively. We acknowledge the concern expressed by the IT and Telecom
RERCs in their comments that company-chosen sets of devices to be made accessible
may not provide good representation of the range of products offered by the company,
and as a result, accessible versions may not always appear in stores, may not always be
available as part of bundles, may be more expensive and difficult to obtain than the
comparable non-accessible products, may not always represent the full range of features
and prices available to everyone else, may not always be supported by employers and
their information technology departments, and may not always be available in certain
parts of the country.371
144.
Because Section 716(g)(4) specifically calls for "varying degrees of
functionality and features, and offered at differing price points,"372 we emphasize that
accessibility features must be made available within a line of products that includes the


367 In particular, the Commission sought comment on ACB's assertion that "[i]t is essential that
manufacturers and service providers make available a range of devices that fit various price ranges along
with corresponding accessible features . . . this may be accomplished by dividing devices into classes and
making certain that each class has at least one option that is fully accessible." ACB Reply Comments to
October Public Notice at 13. See Accessibility NPRM, 26 FCC Rcd at 3162, 76.
368 This includes people with multiple disabilities.
369 See ACB Reply Comments at 30-33; AFB Reply Comments at 11; Consumer Groups Reply Comments
at 2-4.
370 See 47 U.S.C. 617(g)(4). Although a range of accessible products with varying degrees of
functionality and features, at differing price points must be offered across a product line for people with the
full range of disabilities if achievable, in the context of a complaint proceeding, only the facts of the
complaint will be considered. In other words, a complaint proceeding will not consider the accessibility of
a product for types of disabilities that are not the subject of the complaint.
371 See IT and Telecom RERCs Comments at 24. See also AFB Reply Comments at 12 (if a full range of
accessible products is not available, and only top-of-the-line products are accessible, a company should
offer at least one accessible alternative at no additional cost beyond the cost for the level of product desired
by the customer with a disability).
372 47 U.S.C. 617(g)(4).
61

Federal Communications Commission

FCC 11-151

full range of functionality and prices for that line of products.373 In other words, if a line
of products includes low-end products, it is just as important that low-end products and
services be accessible as high-end products and services if achievable.374
145.
We decline to mandate ACB's proposal that, for the purpose of making
available a range of devices that fit various price ranges along with corresponding
accessible features, the devices may be divided into classes, making certain that each
class has at least one option that is fully accessible.375 We agree with CEA that
mandating such a proposal would be unworkable for some manufacturers and service
providers, given that technology and consumer preferences are constantly evolving.376
146.
We also share the concern expressed by Words+ and Compusult that the
fourth achievability factor not be interpreted in a way that would result in people with
disabilities needing to purchase multiple devices to obtain all the disability features that
they require.377 We find that a reasonable interpretation of Sections 716(g)(4) and
716(j)378 calls for the bundling of features within a single device to serve a particular type
of disability, if achievable. For example, if a series of features, such as a screen reader
and a voice interactive menu, were required to be bundled into the same device to render
the device accessible to people who are blind, then a common sense interpretation of the
statute would require that these features be bundled together if achievable under the four
factors.
147.
We find that ITI misunderstands Sections 716(g)(4) and 716(j) when it
asserts that covered entities are compliant "so long as some reasonable subset of features
and services are accessible,"379 because such an approach could result in lack of
accessibility over the full range of functionality and prices. After carefully considering
Section 716(j), we find a more reasonable interpretation to be that there may be some
devices with accessibility features for people with one type of disability, different devices
with accessibility features for people with other types of disabilities, and yet other


373 We therefore reject ITI's assertion that Section 716(g)(4) along with Section 716(j) are to be read to
mean the covered entities are compliant "so long as some reasonable subset of features and services are
accessible." ITI Comments at 10. We are concerned that ITI's reading of the CVAA would result in lack
of accessibility over the full range of functionality and prices.
374 We therefore reject CEA's assertion that mandating a fully accessible low-end device is outside the
scope of the CVAA and is not economically viable. See CEA Comments at 26.
375 See ACB Comments to October Public Notice at 13; ACB Reply Comments at 30-31. See also IT and
Telecom RERCs Comments at 23-24.
376 See CEA Comments at 25-26. See also TechAmerica Comments at 8-9; TIA Comments at 18; CEA
Reply Comments at 13.
377 See Words+ and Compusult Comments at 25.
378 The Section 716(j) Rule of Construction provides that "[t]his section [716] shall not be construed to
require a manufacturer of equipment used for advanced communications or a provider of advanced
communications services to make every feature and function of every device or service accessible for every
disability." 47 U.S.C. 617(j).
379 ITI Comments at 10.
62

Federal Communications Commission

FCC 11-151

devices that are not accessible because accessibility is not achievable for those particular
devices or because the entity offers a full range of accessible products with varying
degrees of functionality and features, at differing price points to discharge its
responsibility under Section 716.380 In other words, Section 716(j) provides a rule of
reason when interpreting Section 716(g).
148.
We decline at this time to designate a list of accessibility features that are
easy to achieve.381 Not only would such a list become outdated very quickly,382 but it is
impossible to assume that any given accessibility feature would be easy to achieve for
every device or service.383 Nevertheless, we strongly encourage, but do not require, all
covered entities to offer accessibility features that are easy to achieve with every
product.384 By way of example, AFB suggests that audible output of menu functions and
on-screen text is easy to achieve.385 Although the record is insufficient to determine
whether AFB's assertion is accurate, if a covered entity finds during the course of its
achievability analysis that audible output of menu functions and on-screen text is easy to
achieve in all of its products, we would encourage the covered entity to install audible
output of menu functions and on-screen text in those products. Voluntary universal
deployment of accessibility features that are easy to achieve as products evolve will
further enable the maximum number of people with disabilities to enjoy access to
products that people without disabilities take for granted.
2.

Industry Flexibility

149.
Background. Sections 716(a)(2) and (b)(2) of the Act provide
manufacturers and service providers flexibility on how to ensure compliance with the
accessibility requirements of the CVAA.386 Specifically, a manufacturer or service
provider may comply with these requirements either by building accessibility features


380 See ACB Reply Comments at 31-32. See also AFB Reply Comments at 11 (for a company to
successfully argue that the Commission is out of step with section 716(j), the company must prove that
compliance is required with respect to all of the company's products and that all of those products are being
required to address all disabling conditions); cf. ITI Comments at 10 ("[I]t may not be possible to make
ACS accessible to every class of people with disabilities at this time.")
381 See CEA Comments at 25 (mandatory list would undermine the flexibility intent of the CVAA); CTIA
Comments at 25-26 (such a list would be contrary to both the Section 716(g) achievability factors and the
Section 716(j) rule of construction); IT and Telecom RERCs Comments at 23; TIA Comments at 18.
Contra Words+ and Compusult Comments at 25; AAPD Reply Comments at 6.
382 See CEA Comments at 25; CTIA Comments at 25-26; IT and Telecom RERCs Comments at 23; CEA
Reply Comments at 13; Green Reply Comments at 7 (regulations requiring certain types of tools to be
built-in will risk the result of reducing competition and incentives for application developers).
383 See CTIA Comments at 25-26.
384 IT and Telecom RERCs Comments at 23. For example, a nib on a 5 key would be easy to achieve for
physical keys, Accessibility NPRM, 26 FCC Rcd at 3161, 76 and n.222, but appears not to be achievable
at this time in the case of a touch screen. CTIA Comments at 26.
385 AFB Reply Comments at 11.
386 47 U.S.C. 617(a)(2), (b)(2). See Accessibility NPRM, 26 FCC Rcd at 3162, 77.
63

Federal Communications Commission

FCC 11-151

into the equipment or service or by "using third party applications, peripheral devices,
software, hardware, or customer premises equipment that is available to consumers at
nominal cost and that individuals with disabilities can access."387 While the Senate
Report did not discuss these provisions, the House Report makes clear that the choice
between these two options "rests solely with the provider or manufacturer."388
150.
Discussion. As urged by several commenters, we confirm that Section
716 allows covered entities the flexibility to provide accessibility through either built-in
solutions or third-party solutions, so long as the third-party solutions are available at
nominal cost to consumers.389 As suggested by TIA, we find that manufacturers and
service providers should be able to rely on a wide range of third-party accessibility
solutions and whether such solutions meet the accessibility requirements should be
decided on a case-by-case basis.390 Moreover, by putting the decision in the hands of the
manufacturers and service providers those who are in the best position to determine the
most economical manner of compliance we ensure that the aims of the statute will be
met in the most cost-effective manner. At the same time, we encourage such
manufacturers and service providers who wish to use third party accessibility solutions,
to consult with people with disabilities about their accessibility needs because these
individuals will be best equipped to provide guidance on which third-party accessibility
solutions will be able to meet those needs. Consultation with the disability community
will best achieve effective and economical accessibility solutions.
151.
The Commission acknowledged in the Accessibility NPRM that "universal
design," which is "a concept or philosophy for designing and delivering products and
services that are usable by people with the widest possible range of functional
capabilities, which include products and services that are directly accessible (without
requiring assistive technologies), and products and services that are interoperable with
assistive technologies,"391 will continue to play an important role in providing
accessibility for people with disabilities. At the same time, the Commission
acknowledged that, while Section 255 had relied primarily on universal design principles,
the industry flexibility provisions of the CVAA reflect that there are new ways to meet


387 47 U.S.C. 617(a)(2), (b)(2).
388 House Report at 24.
389 47 U.S.C. 617(a)(2), (b)(2); Accessibility NPRM, 26 FCC Rcd at 3162, 77. See CEA Comments at
26-27; CTIA Comments at 27; TIA Comments at 19; T-Mobile Comments at 11; Verizon Comments at 12;
AAPD Reply Comments at 3; CEA Reply Comments at 14. Contra ACB Reply Comments at 34 (built-in
solutions should be the priority when technical factors do not prohibit those solutions). See also ITI
Comments at 6 ("Where built-in AT is not achievable, the consumer is best served by rules that recognize
the value of third-party AT providers. . .").
390 TIA Comments at 21. See also Green Reply Comments at 8 (the flexibility for the developer to
determine what applications to bundle with the operating system and what applications to leave to the
secondary marketplace will allow individuals with disabilities to choose the best device for their needs and
allow personalization over time).
391 29 U.S.C. 3002(a)(19). See Section 255 Report and Order, 16 FCC Rcd at 6441, 50, n.138, citing
Pub. L. No. 105-394, 3(a)(17), November 13, 1998 (Assistive Technology Act of 1998).
64

Federal Communications Commission

FCC 11-151

the needs of people with disabilities that were not envisioned when Congress passed
Section 255.392 We agree with Consumer Groups that new and innovative technologies
may now be able to more efficiently and effectively meet individual needs by
personalizing services and products, than services and products built to perform in the
same way for every person.393 Accordingly, as supported by several commenters, we
affirm that the Commission should afford manufacturers and service providers as much
flexibility to achieve compliance as possible,394 so long as each does everything that is
achievable in accordance with the achievability factors.395
152.
As supported by several commenters, we adopt the Commission's
proposal in the Accessibility NPRM that "any fee for third-party software or hardware
accessibility solutions be `small enough so as to generally not be a factor in the
consumer's decision to acquire a product or service that the consumer otherwise
desires.'"396 We will apply this definition in accordance with the proposal submitted by
AFB that in considering whether the cost to the consumer is nominal, we must look at the
initial purchase price, including installation, plus the ongoing costs to the consumer to
keep the third-party solution up to date and in good working order, and that the total cost
to the consumer must be nominal as perceived by the consumer.397 We believe that this
approach, which emphasizes the definition of nominal cost as perceived by the consumer,
addresses the IT and Telecom RERCs' concerns that our proposed definition of nominal
cost provides insufficient guidance and does not take into account that many people with
disabilities are poor and already face greater costs for nearly every aspect of their lives.398


392 Accessibility NPRM, 26 FCC Rcd at 3162, 77.
393 See Consumer Groups Comments at 19; Green Reply Comments at 3-4, 7 (Commission should promote
multi-function devices, with accessibility built into the hardware and operating system, customizable to an
individual's specific needs through easy, inexpensive software downloads, which would allow a single type
of device to be accessible to people with a range of disabilities).
394 CEA Comments at 27; ITI Comments at 8; NCTA Comments at 3, 6; TIA Comments at 19; T-Mobile
Comments at 2; TWC Comments at 5-7. For example, a person with low vision may choose a software
program that enlarges the size of the text, while a person who is blind may select a screen reader.
395 CEA Comments at 27. See also ITI Comments at 9; Green Reply Comments at 7 (requiring built-in
solutions, as compared to after-market sale of a software application, would unduly limit the
customizations available to a range of disabilities). See generally Accessibility NPRM, 26 FCC Rcd at
3162-3163, 77.
396 Accessibility NPRM, 26 FCC Rcd at 3163, 78, quoting House Report at 24. See AFB Comments at 4;
AT&T Comments at 10; CTIA Comments at 28; TIA Comments at 20; Verizon Comments at 12.
397 See AFB Comments at 4. See also AT&T Comments at 11 (service providers and manufacturers should
be permitted to initially subsidize and spread out the cost of an accessibility solution to the consumer so
long as the cost at the time of purchase plus all additional costs over time qualify as nominal as perceived
by the consumer); Words+ Compusult Comments at 28. Contra Green Reply Comments at 9 (do not add
on third-party costs to the monthly service fee).
398 See IT and Telecom RERCs Comments at 24. See also ACB Reply Comments at 37 (nominal means
"so small or trivial as to be a mere token"); Letter from Andrew S. Phillips, Counsel to National
Association of the Deaf, on behalf of the Coalition of Organizations for Accessible Technology ("COAT"),
to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 2 (filed Oct. 3, 2011) ("COAT Oct. 3 Ex
Parte
") ("people with disabilities are experiencing the highest unemployment rates of any minority
(continued....)
65

Federal Communications Commission

FCC 11-151

In other words, the definition of nominal cost as perceived by the consumer will take into
account the financial circumstances generally faced by people with disabilities.
153.
As suggested by several commenters, we will not adopt a fixed percentage
definition for nominal cost.399 We are mindful of T-Mobile's concern that we should not
interpret the term nominal cost so narrowly as to negate the opportunity for third-party
accessibility solutions.400 As supported by several commenters, we will therefore
determine whether the cost of a third-party solution is nominal on a case-by-case basis,401
taking into consideration the nature of the service or product,402 including its total lifetime
cost.403
154.
Several commenters also express concerns about the Commission's
proposal in the Accessibility NPRM that a third-party solution not be more burdensome to
a consumer than a built-in solution would be,404 arguing that this test would not be
workable because it would result in no third-party solutions.405 In response to these
concerns, we clarify how we intend to interpret those requirements to ensure their
workability. Because adaptive communications solutions are often not available with
mainstream products and finding these solutions often has been difficult for people with
disabilities in the past,406 we agree with those commenters that assert that a manufacturer
or service provider that chooses to use a third-party accessibility solution has the
responsibility to identify, notify consumers of, find, and arrange to install and support the
third-party technology along with the covered entity's product to facilitate consumer
access to third-party solutions.407 We find that the covered entity must support the third-
(Continued from previous page)


groups"); Green Reply Comments at 9, 12 (add-on costs should be measured in dollars, not hundreds of
dollars; it will do no good to make technologies accessible to people with disabilities if they cannot afford
it). But see CEA Reply Comments at 15 (it is unworkable to consider nominal cost subjectively from the
point of view of the consumer).
399 See CEA Comments at 27; CTIA Comments at 28; TIA Comments at 20; T-Mobile Comments at 11;
Verizon Comments at 12; T-Mobile Reply Comments at 13. Contra Green Reply Comments at 9.
400 See T-Mobile Comments at 10-11; T-Mobile Reply Comments at 13.
401 See CEA Comments at 27; TIA Comments at 20; Verizon Comments at 12; CEA Reply Comments at
15; CTIA Reply Comments at 25.
402 See CEA Comments at 27; Verizon Comments at 12; CTIA Reply Comments at 25.
403 See CEA Comments at 27; CTIA Comments at 28; T-Mobile Comments at 10; CTIA Reply Comments
at 25; T-Mobile Reply Comments at 13.
404 Accessibility NPRM, 26 FCC Rcd at 3164, 80.
405 CEA Comments at 28; TIA Comments at 21; CEA Reply Comments at 14. Contra Consumer Groups
Comments at 19; IT and Telecom RERCs Comments at 25.
406 Accessibility NPRM, 26 FCC Rcd at 3164, 80 n.237.
407 See Consumer Groups Comments at 19; IT and Telecom RERCs Comments at 25; ACB Reply
Comments at 34; CTIA Reply Comments at 23-24; IT and Telecom RERCs Reply Comments at 3. See
also
AFB Comments at 4 (covered entities can rely only on third-party solutions that are available in the
market). Although we will not adopt the testing requirements proposed by the IT and Telecom RERCs
because we believe that the other requirements we adopt herein with respect to third-party solutions will
ensure accessibility of ACS products and services to consumers with disabilities, we nevertheless
(continued....)
66

Federal Communications Commission

FCC 11-151

party solution for the life of the ACS product or service or for a period of up to two years
after the third-party solution is discontinued, whichever comes first,408 provided that
another third-party accessibility solution is made available by the covered entity at
nominal cost to the consumer. In other words, to ensure accessibility of products and
services covered by the CVAA, if another third-party solution is not made available by
the covered entity at nominal cost to the consumer, then the covered entity may not
discontinue support for the original third-party solution.409
155.
We agree with those commenters that suggest that we should not impose a
requirement to bundle third-party solutions with ACS products and services,410 because a
bundling requirement would provide industry with less flexibility than Congress
intended.411 Therefore, third-party solutions can be made available after-market, rather
than at the point of purchase,412 provided that such third-party solutions are made
available around the same time as when the product or service is purchased. This will
ensure that the consumer has access to the product near the time of purchase, allow for
additional implementation steps that may be needed,413 and promote innovation by
reducing the likelihood of being locked into the accessibility solutions available at the
time the product was offered for sale.414
156.
As explained in the preceding paragraphs, the total cost to the consumer of
the third-party solution, including set-up and maintenance, must be nominal. We expect
the set-up and maintenance for a third-party accessibility solution to be no more difficult
(Continued from previous page)


encourage covered entities to test third-party accessibility solutions with people with disabilities to ensure
that such third-party solutions work as intended. See IT and Telecom RERCs Comments at 25; cf. CTIA
Reply Comments at 24 (no obligation in CVAA to test third-party accessibility solutions with other major
third-party applications).
408 See TIA Comments at 21-22; cf. CEA Comments at 28; CEA Reply Comments at 14-15 (opposes any
requirement to support a third-party solution over the life of the product on the grounds that the covered
entity has no direct involvement with such support, which is undertaken by the third-party vendor).
409 See CTIA Comments at 28 (covered entities should be able to change their means of compliance, as
long as the third-party solution remains at nominal cost). We believe that the requirement to provide
support for a replacement third-party accessibility solution addresses the concern expressed by the IT and
Telecom RERCs Reply Comments at 4 (proposing covered entity support of the third-party solution for the
same period as the underlying ACS product is supported).
410 Accessibility NPRM, 26 FCC Rcd at 3164, 80.
411 See CEA Comments at 28 (a bundling requirement would also impose particular relationships between
covered entities and third-party vendors); TIA Comments at 22; T-Mobile Comments at 11.
412 See CEA Comments at 27; CTIA Comments at 27; TIA Comments at 21; T-Mobile Comments at 11;
Verizon Comments at 12; T-Mobile Reply Comments at 12-13. Contra ACB Reply Comments at 34
(third-party solutions cannot be an after-market sale for which the user must perform additional steps to
obtain).
413 See CEA Comments at 27.
414 See CEA Comments at 27-28; CTIA Comments at 28.
67

Federal Communications Commission

FCC 11-151

than the set-up and maintenance for other applications used by consumers.415 If the third-
party solution by its nature requires technical assistance with set-up or maintenance, we
find that the covered entity must either provide those functions, including personnel with
specialized skills if needed,416 or arrange for a third party to provide them.
157.
We reject Verizon's argument that manufacturers and service providers
should not be required to provide support for the third-party solutions, because such a
requirement would effectively require a contractual relationship, including intricate
knowledge of the third party's proprietary solution, where none may exist.417 Verizon's
theory would conflict with the plain meaning of Sections 716(a)(2) and (b)(2), which
afford manufacturers and service providers the option to rely on third-party solutions to
ensure that their products and services are accessible if achievable.418 If the covered
entities elect to offer third-party solutions to achieve accessibility but do not support such
third-party solutions, they would be undermining the availability of such solutions.419
3.

Compatibility

158.
Background. Under Section 716(c) of the Act, whenever accessibility is
not achievable either by building in access features or using third-party accessibility
solutions as set forth in Sections 716(a) and (b), a manufacturer or service provider must
"ensure that its equipment or service is compatible with existing peripheral devices or
specialized customer premises equipment commonly used by individuals with disabilities
to achieve access," unless that is not achievable.420 Section 255 contains a similar
compatibility requirement for telecommunications service providers and manufacturers if
it is readily achievable to do so, in cases where built-in accessibility is not readily
achievable. Our Section 255 rules define peripheral devices to mean "devices employed
in connection with equipment covered by this part to translate, enhance or otherwise
transform telecommunications into a form accessible to individuals with disabilities."421


415 See IT and Telecom RERCs Comments at 25 (a third-party solution needs to be equally compatible,
interoperable, and simple to set up and use with the ACS device or service); ACB Comments to October
Public Notice
at 14; ACB Reply Comments at 34 (a third-party solution should not require set-up or
maintenance by a person without disabilities); Green Reply Comments at 7-8 (installation should be no
more burdensome than installations by a typical user, or in the alternative, no more burdensome than a sales
associate at a Verizon store can handle).
416 Words+ and Compusult Comments at 28 ("third party add-ons are too specialized for ACS's
representatives to be properly trained [to] explain, demonstrate, to match a customer's needs or set up for
the user.").
417 See Verizon Comments at 13.
418 47 U.S.C. 617(a)(2), (b)(2).
419 Consumer Groups Reply Comments at 2, 4 (Commission should not allow manufacturers and service
providers to rely upon third-party solutions to satisfy CVAA obligations but disclaim any responsibility for
the compliance of such third-party solutions); IT and Telecom RERCs Reply Comments at 3 (if a
manufacturer does not want the burden of contracts and collaboration with third parties, the manufacturer
can opt for a built-in solution).
420 See 47 U.S.C. 617(c).
421 47 C.F.R. 6.3(g), 7.3(g).
68

Federal Communications Commission

FCC 11-151

The Commission's Section 255 rules define specialized CPE as customer premises
equipment that is commonly used by individuals with disabilities to achieve access.422
159.
For purposes of Section 716, in the Accessibility NPRM, the Commission
proposed to define peripheral devices as "devices employed in connection with
equipment, including software, covered under this part to translate, enhance, or otherwise
transform advanced communications services into a form accessible to individuals with
disabilities."423 The Commission also proposed to define specialized CPE, consistent
with our Section 255 rules, as "customer premises equipment which is commonly used by
individuals with disabilities to achieve access."424
160.
Under our Section 255 rules, we use four criteria for determining
compatibility: (i) external electronic access to all information and control mechanisms;
(ii) existence of a connection point for external audio processing devices; (iii) TTY
connectability; and (iv) TTY signal compatibility.425 In the Accessibility NPRM, the
Commission asked whether the four criteria listed above remain relevant in the context of
advanced communications services.426 Noting that a sizeable majority of consumers who
previously relied on TTYs for communication are transitioning to more mainstream
forms of text and video communications,427 the Commission sought comment on whether
it should encourage an efficient transition by phasing out the third and fourth criteria as
compatibility components in our Section 716 rules and/or in our Section 255 rules.428
The Commission also sought comment on whether it should ensure that these
requirements are phased out only after alternative forms of communication, such as real-
time text, are in place.429
161.
In the Accessibility NPRM, the Commission also sought comment on
whether and how it should use the Access Board Draft Guidelines to help define
compatibility for purposes of Section 716.430 Finally, the Commission inquired about the


422 47 C.F.R. 6.3(i), 7.3(i).
423 Accessibility NPRM, 26 FCC Rcd at 3166, 87.
424 Accessibility NPRM, 26 FCC Rcd at 3166, 87. See 47 C.F.R. 6.3(c), 7.3(c).
425 47 C.F.R. 6.3.
426 Accessibility NPRM, 26 FCC Rcd at 3166, 88.
427 Accessibility NPRM, 26 FCC Rcd at 3166, 88.
428 Accessibility NPRM, 26 FCC Rcd at 3166, 88.
429 Accessibility NPRM, 26 FCC Rcd at 3166-3167, 88. We note that elsewhere in the CVAA, the
Commission is directed to establish an advisory committee whose task is, in part, to consider "[t]he
possible phase out of the use of current-generation TTY technology to the extent that this technology is
replaced with more effective and efficient technologies and methods to enable access to emergency
services by individuals with disabilities." Pub. L. No. 111-260, l06(c)(6).
430 Accessibility NPRM, 26 FCC Rcd at 3167, 89.
69

Federal Communications Commission

FCC 11-151

status of industry development of APIs and whether incorporating criteria related to APIs
into our definition of compatibility could promote the development of APIs.431
162.
Discussion. We adopt the definition of "peripheral devices" proposed in
the Accessibility NPRM.432 We agree with the vast majority of commenters that
peripheral devices can include mainstream devices and software,433 as long as they can be
used to "translate, enhance, or otherwise transform advanced communications services
into a form accessible to individuals with disabilities" and the devices and software are
"commonly used by individuals with disabilities to achieve access." We did not receive
comments on the IT and Telecom RERCs proposal to expand our definition of peripheral
devices and decline to adopt their proposal at this time.434 However, we seek further
comment in the accompanying Further Notice on its proposal.
163.
We also adopt the same definition of specialized CPE as is used in our
Section 255 rules435 and proposed in the Accessibility NPRM.436 The Commission has
traditionally interpreted CPE broadly to include wireless devices such as cellular
telephone handsets, and we retain the flexibility to construe the scope of specialized CPE
consistent with Commission precedent.437 Therefore, changing the regulatory definition
of CPE, as the IT and Telecom RERCs suggest, to explicitly include mobile devices


431 Accessibility NPRM, 26 FCC Rcd at 3167, 90.
432 See Accessibility NPRM, 26 FCC Rcd at 3196, Subpart B Definitions, 8.4(r).
433 See AT&T Comments to October Public Notice at 9; CEA Comments to October Public Notice at 12;
RERC-IT Comments to October Public Notice at 6; TIA Comments to October Public Notice at 15-16;
Words+ Comments to October Public Notice at 2; AAPD Reply Comments to October Public Notice at 4;
AbleLink Reply Comments to October Public Notice at 1; ACB Reply Comments to October Public Notice
at 18; Adaptive Solutions Reply Comments to October Public Notice at 1; Compusult Reply Comments to
October Public Notice at 1; CTIA Reply Comments to October Public Notice at 14-15; RERC-IT Reply
Comments to October Public Notice at 6; Point-and-Read Comments to October Public Notice at 1;
Wireless RERC Reply Comments to October Public Notice at 4; CEA Comments at 29-30; Consumer
Groups Comments at 21; IT and Telecom RERCs Comments at 26; T-Mobile Comments at 13; T-Mobile
Reply Comments at 15.
434 The IT and Telecom RERCs proposed to define peripheral devices as "devices employed in connection
with equipment covered by this part, including software and electronically mediated services, to translate,
enhance, or otherwise transform advanced communications services into a form accessible to people with
disabilities" (emphasis added). IT and Telecom RERCs Comments at 27-28. See Accessibility NPRM, 26
FCC Rcd at 3196, Subpart B Definitions, 8.4(r).
435 See 47 C.F.R. 6.3(i), 7.3(i). See also 47 C.F.R. 6.3(c), 7.3(c) (defining "customer premises
equipment").
436 See Accessibility NPRM, 26 FCC Rcd at 3196, Subpart B Definitions, 8.4(v).
437 See, e.g., Bundling of Cellular Premises Equipment and Cellular Service, CC Docket No. 91-34, Report
and Order, DA 92-207, 7 FCC Rcd 4028, 9 (1992); Implementation of the Telecommunications Act of
1996: Telecommunications Carriers' Use of Customer Proprietary Network Information and Other
Customer Information
, CC Docket No. 96-115, Order, DA 98-971, 13 FCC Rcd. 12390, 12394, 5 (1998).
70

Federal Communications Commission

FCC 11-151

carried by the user is unnecessary.438 We also note that a mobile device could meet the
definition of a peripheral device to the extent that it is used to "translate, enhance, or
otherwise transform advanced communications services into a form accessible to people
with disabilities."439
164.
Consistent with the Commission's decision in the Section 255 Report and
Order, we will require manufacturers and service providers to exercise due diligence to
identify the types of peripheral devices and specialized CPE "commonly used" by people
with disabilities with which their products and services should be made compatible.440
We also find that when determining whether a particular device is commonly used by
individuals with disabilities, a manufacturer or provider should look at the use of that
device among persons with a particular disability.441 In addition, we agree with AFB that
for compatibility to be achieved, a third party add-on must be an available solution that
the consumer can access to make the underlying product or service accessible.442
Compliance is not satisfied because a device's software architecture might someday
allow a third party to write an accessibility application.443 We agree with ITI, however,
that "a manufacturer or service provider need not make its equipment or service
compatible with every peripheral device or piece of customer equipment used to achieve
access."444 Covered entities are also not required to test compatibility with every assistive
technology device in the market.445
165.
Consistent with the Section 255 Report and Order, we decline to maintain
a list of peripheral devices and specialized CPE commonly used by individuals with
disabilities or to define how covered entities should test devices which are "commonly
used" by people with disabilities, given how quickly technology is evolving.446 For the
same reason, we agree with the IT and Telecom RERCs that covered entities do not have
a duty to maintain a list of all peripheral devices and specialized CPE used by people
with disabilities.447 At this time, we also decline to limit the definition of "existing"
peripheral devices and specialized customer premises equipment to those that are


438 IT and Telecom RERCs Comments at 28. The term "customer premises equipment" means equipment
employed on the premises of a person (other than a carrier) to originate, route, or terminate
telecommunications. 47 U.S.C. 153(16).
439 Accessibility NPRM, 26 FCC Rcd at 3196, Subpart B Definitions, 8.4(r). See generally, IT and
Telecom RERCs Comments at 28.
440 Section 255 Report and Order, 16 FCC Rcd at 6435, 36. See also AFB Comments at 3.
441 Section 255 Report and Order, 16 FCC Rcd at 6435, 36.
442 AFB Comments at 3-4; AAPD Reply Comments at 3.
443 AFB Comments at 4.
444 ITI Comments at 12. See also CTIA Sept. 30 Ex Parte at 2.
445 TIA Comments at 34.
446 Section 255 Report and Order, 16 FCC Rcd at 6435, 36. But see ITI Comments at 12; TIA Comments
at 33-34.
447 IT and Telecom RERCs Comments at 27.
71

Federal Communications Commission

FCC 11-151

currently sold, as ITI proposes.448 As discussed above, we believe that "existing"
peripheral devices and specialized customer premises equipment include those which
continue to be "commonly used" by people with disabilities.449 For example, a particular
screen reader may no longer be manufactured,450 but could still be "commonly used." We
do note, however, that peripheral devices and specialized customer premises equipment
that are no longer sold will eventually cease being "commonly used." We also believe
that covered entities have an ongoing duty to consider how to make their products
compatible with the software and hardware components and devices that people with
disabilities use to achieve access and to include this information in their records required
under Section 717(a)(5).451
166.
In declining to limit the definition of "existing" peripheral devices and
specialized customer premises equipment to those that are currently sold, we recognize
that we may be imposing an additional burden on industry resources. We are open to any
idea that could facilitate transition without consumers having to bear the costs. In
reaching this decision, we acknowledge this additional burden against the benefits of
maintaining access for consumers with disabilities to "commonly used" peripheral
devices and specialized customer premises equipment. We believe that ensuring that
people with disabilities continue to have access to "commonly used" technologies that
facilitate their ongoing participation in economic and civic activities outweighs the
burden on industry and furthers the statute's overriding objective "[t]o increase the access
of persons with disabilities to modern communications."452
167.
Finding that the four criteria used in our Section 255 rules for determining
compatibility remain relevant in the context of advanced communications services, we
adopt the following factors for determining compatibility: (i) external access to all
information and control mechanisms; (ii) existence of a connection point for external
audio processing devices; (iii) TTY connectability; and (iv) TTY signal compatibility.453
The Commission declines, at this time, to eliminate or modify (iii) and (iv) of this
criteria.454 The Commission agrees with Consumer Groups that at this time, "[a] forced
phase-out of TTY would impose considerable hardship on a large segment of the


448 But see ITI Comments at 11-12; ITI July 8 Ex Parte at 3.
449Section 255 Report and Order, 16 FCC Rcd at 6435, 36.
450 ITI July 8 Ex Parte at 3.
451 See 47 U.S.C. 618(a)(5). Under Section 717(a)(5)(iii), covered entities are required to maintain
"information about the compatibility of [their] products and services with peripheral devices or specialized
[CPE] commonly used by individuals with disabilities to achieve access."
452 Pub. L. No. 111-260, 124 Stat. 2751, pmbl.
453 47 C.F.R. 6.3. While we encourage industry to develop standards to promote compatibility and "to
develop new and innovative solutions for people with disabilities," see ITI Comments at 13, we note that
abiding by such standards does not eliminate covered entities' obligations to adhere to the four
compatibility factors discussed below.
454 But see CEA Comments at 30; IT and Telecom RERCs Comments at 27.
72

Federal Communications Commission

FCC 11-151

population the CVAA is intended to protect."455 Therefore, we shall maintain the existing
rules for TTY compatibility until alternative forms of communication, such as real-time
text, are in place.456
168.
At this time, the Commission will not incorporate criteria related to APIs
or software development kits (SDKs) into our definition of compatibility.457 We do agree
with commenters, however, that APIs "can facilitate both accessibility (via third-party
solutions) as well as compatibility" and "reduce the work needed by both mainstream and
assistive technology (AT) developers."458 We encourage stakeholders to use existing
working groups -- or form new ones -- to develop and distribute voluntary industry-wide
standards, since this approach will offer the industry flexibility in advancing the goals of
compatibility articulated in Sections 716 and 255.459
169.
Several commenters generally support the Access Board's proposed
definition of "compatibility" and the VON Coalition suggests that the Commission
should defer to the Access Board's determination of "compatibility" under Section 508,
thereby creating consistency between the CVAA and Section 508.460 Because the Access
Board has not yet completed its guidelines process, we will not adopt the Access Board's
proposed definition of "compatibility" at this time but may revisit this decision after the
Access Board completes its guidelines process.461


455 Consumer Groups at 22; Consumer Groups Reply Comments at 6.
456 Until a real time text standard is adopted, we believe that it would be premature to modify the third and
fourth criteria as the IT and Telecom RERCs suggest. IT and Telecom RERCs Comments at 28. The
provision of real-time text as communications technologies, including those used for 9-1-1 emergency
services by people with disabilities, transition from the PSTN to an IP-based environment is being
examined by the EAAC. See supra note 40. The EAAC held its first meeting on January 14, 2011 and will
provide its recommendations to the Commission in December 2011. See Pub. L. No. 111-260, 106(c)(1).
The Commission has initiated a rulemaking seeking to accelerate the development and deployment of Next
Generation 911 (NG911) technology that will enable the public to send emergency communications to 911
Public Safety Answering Points (PSAPs) via text, photos, videos, and data. Framework for Next
Generation 911 Deployment
, PS Docket No. 10-255, FCC 11-134, Notice of Proposed Rulemaking,
(released Sept. 22, 2011).
457 CEA Reply Comments at 15. But see Microsoft Comments at 14.
458 CEA Comments at 30; IT and Telecom RERCs Comments at 29; Words+ and Compusult Comments at
32. See also VON Coalition Comments at 8 ("Devices in which accessibility is not achievable but
compatibility with assistive technologies is required, accessibility programming interfaces are critical in
enabling interoperability between the two.").
459 Words+ and Compusult Comments at 27-28; CEA Reply Comments at 15-16. See Section 255 Report
and Order
, 16 FCC Rcd at 6434, 35.
460 IT and Telecom RERCs Comments at 29; Words+ and Compusult Comments at 31; VON Coalition
Comments at 8. But see ACB Reply Comments at 38 (agreeing that "the proposed Access Board
guidelines may be useful to consider but should not be relied on as anything more than advisory material");
AFB Reply Comments at 12.
461 CEA Comments at 29-30; TIA Comments at 33; Verizon Comments at 13.
73

Federal Communications Commission

FCC 11-151

C.

Waivers and Exemptions

1.

Customized Equipment or Services

170.
Background. Section 716(i) states that the accessibility requirements of
Section 716 "shall not apply to customized equipment or services that are not offered
directly to the public, or to such classes of users as to be effectively available directly to
the public, regardless of the facilities used."462 In the Accessibility NPRM, the
Commission found that the CVAA's legislative history evinced Congress's intent that the
Section 716(i) exemption be narrow in scope and applicable only to customized
equipment and services offered to business or other enterprise customers, rather than to
equipment and services "used by members of the general public."463 The Commission
sought comment on this analysis, as well as on the extent to which the equipment and
services used by private institutions but made available to the public, such as
communications equipment and services used by libraries and schools, should be covered
by the CVAA. The Commission also sought comment on how to define equipment and
services that are "used by members of the general public."464 Finally, the Commission
sought comment on the extent to which Section 716 covers products and services that are
offered to the general public, but which have been customized in minor ways to meet the
needs of private entities.
171.
Discussion. We hereby find that Section 716(i) sets forth a narrow
exemption that should be limited in scope to customized equipment and services offered
to business and other enterprise customers only. Our decision is consistent with the
legislative history of the CVAA, which demonstrates that Congress intended for Section
716(i) to be a narrow exemption limited to specialized and innovative equipment or
services built to the unique specifications of businesses:
The Committee recognizes that some equipment and services are
customized to the unique specifications requested by an enterprise
customer. The Committee believes this narrow exemption will encourage
technological innovation by permitting manufacturers and service
providers to respond to requests from businesses that require specialized
and sometimes innovative equipment to provide their services efficiently.
This provision is not intended to create an exemption for equipment and
services designed for and used by members of the general public.465

172.
We also conclude that Section 716's accessibility requirements do not
extend to public safety communications networks and devices, because such networks
and devices are "equipment and services that are not offered directly to the public."466 As


462 See 47 U.S.C. 617(i).
463 Accessibility NPRM, 26 FCC Rcd at 3152, 50 (citing House Report at 26).
464 Accessibility NPRM, 26 FCC Rcd at 3152, 50.
465 House Report at 26.
466 See 47 U.S.C. 617(i). See also Motorola Comments at 4-6,
74

Federal Communications Commission

FCC 11-151

Motorola points out, this conclusion is consistent with the Commission's recent proposal
not to apply its hearing aid compatibility requirements to public safety equipment.467 In
that proceeding, the Commission proposed to find that insofar as public safety
communications networks have different technical, operational, and economic demands
than consumer networks, the burdens of compliance would outweigh the public
benefits.468 For the same reasons, we find that Section 716 should not be imposed on
public safety equipment.
173.
We disagree with commenters such as Consumer Groups, and Words+ and
Compusult who posit that public safety networks and devices should not be exempt from
Section 716 because their employees should be covered like the general population.469
These commenters argue that exempting public safety networks will create barriers to
employment for people with disabilities employed in the public safety sector.470 We note,
however, that employers, including public safety employers, are subject to accessibility
obligations imposed under the ADA.471 Because employees of public safety institutions
are protected by the ADA, and because the equipment we exempt is customized for the
unique needs of the public safety community, we conclude that imposing the accessibility
requirements of Section 716 on such equipment would create an unnecessary burden on
the development of public safety equipment without any concomitant benefit for
employees with disabilities. Nonetheless, we agree with CSD that "to the extent possible,
public safety systems should be designed to accommodate the needs of deaf [and] hard-
of-hearing employees and employees with other disabilities."472
174.
We agree with CEA that products customized by a manufacturer for an
enterprise that are not offered directly to the general public are exempt, even if such
products are "used by members of the general public."473 We also agree with the IT and
Telecom RERCs that if a customized product built to an enterprise customer's unique
specifications is later made directly available to the public, it then becomes subject to the
CVAA.474 Although the legislative history specifies that the exemption set forth in
Section 716(i) encompasses equipment/services customized to the "unique specifications


467 Motorola Comments at 4-6. See also Hearing Aid Compatibility FNPRM, 25 FCC Rcd at 11195, 82
(consistent with distinctions drawn in past, the Commission proposed not to extend hearing aid
compatibility rules to certain non-interconnected systems used solely for internal communications, such as
public safety or dispatch networks).
468 Hearing Aid Compatibility FNPRM, 25 FCC Rcd at 11195, 82.
469 Words+ and Compusult Comments at 17; Consumer Groups Comments at 12.
470 Words+ and Compusult Comments at 17; Consumer Groups Comments at 12.
471 See ITI Comments at 21. We therefore have modified the definition of "customized equipment or
services" as proposed in the Accessibility NPRM to delete the phrase, "but shall not apply to equipment
distributed to and services used by public or private sector employees, including public safety employees."
472 CSD Reply Comments to October Public Notice at 4.
473 CEA Comments at 16-17; CEA Reply Comments at 9-10.
474 IT and Telecom RERCs Reply Comments at 4.
75

Federal Communications Commission

FCC 11-151

requested by an enterprise customer," we find that where a customized product is
subsequently offered directly to the public by the originating manufacturer or service
provider, that product is then not serving the unique needs of an enterprise customer and
thus should not be exempt from the accessibility requirements of Section 716.
175.
We disagree with commenters such as Consumer Groups, the IT and
Telecom RERCs, and Words+ and Compusult who advocate that we expand the
definition of "public" as used in Section 716(i), to include government agencies,
educational organizations, and public institutions.475 While Congress clearly meant to
draw a distinction between equipment or a service that has been "customized to the
unique specifications requested by an enterprise customer" from "equipment and services
designed for and used by members of the general public" in enacting the exemption in
Section 716(i),476 there is no support for the proposition that the use of the term "public"
in the foregoing phrase was meant to extend to public institutions. Furthermore, there are
many instances where public institutions, acting as enterprise customers, order
customized equipment, such as library cataloging systems, whereby such systems would
never be designed for, sold to, and used directly by members of the general public.
Under Consumer Groups' approach, a public institution could never be considered an
enterprise customer, even when procuring specialized equipment that would not be
offered to the public or even other enterprise customers. There is nothing in the statute
demonstrating that Congress intended to treat public institutions differently from other
enterprise customers who are in need of customized or specialized equipment. Therefore,
we decline to expand the definition of the word "public" as used in Section 716(i) to
public institutions.477
176.
We further conclude that customizations to communications devices that
are merely cosmetic or do not significantly change the functionalities of the device or
service should not be exempt from Section 716. We agree with Words+ and Compusult
that the Section 716(i) exemption should be narrowly construed, and further agree with
Consumer Groups that manufacturers and service providers should not be able to avoid
the requirements of the CVAA through customizations that are "merely cosmetic" or
have "insignificant change to functionality" of the product/service.478 We note that the
majority of commenters support the conclusion that this exemption should not extend to
equipment or services that have been customized in "minor ways" or "that are made
available to the public."479


475 Consumer Groups Comments at 12; IT and Telecom RERCs Comments at 15-16; Words+ and
Compusult Comments at 17.
476 CTIA Comments at 23. See House Report at 26.
477 Equipment, such as general purpose computers, that are used by libraries and schools without
customization, and are offered to the general public i.e., library visitors and students, would not fall
within the exemption and must meet the accessibility requirements of Section 716.
478 See Consumer Groups Comments at 12; Words+ and Compusult Comments at 17.
479 Consumer Groups Comments at 12; CTIA Comments at 23; ITI Comments at 22; Motorola Comments
at 3.
76

Federal Communications Commission

FCC 11-151

177.
Beyond the narrow exemption that we carve out today for public safety
communications, we refrain from identifying any other particular class of service or
product as falling within the Section 716(i) exemption. We disagree with NetCoalition
that the exemption should apply to ACS manufacturers or service providers who offer
their products to a "discrete industry segment" and only a "relatively small number of
individuals." The exemption is not based on the characteristics of the manufacturer or
the provider, but rather, on whether the particular equipment or service in question is
unique and narrowly tailored to the specific needs of a business or enterprise.
178.
The customized equipment exemption will be self-executing. That is,
manufacturers and providers need not formally seek an exemption from the Commission,
but will be able to raise 716(i) as a defense in an enforcement proceeding.
2.

Waivers for Services or Equipment Designed Primarily for
Purposes other than Using ACS

179.
Background. Section 716(h)(1) of the Act grants the Commission the
authority to waive the requirements of Section 716. Specifically, Section 716(h)(1)
states:
The Commission shall have the authority, on its own motion or in
response to a petition by a manufacturer or provider of advanced
communications services or any interested party, to waive the
requirements of [Section 716] for any feature or function of equipment
used to provide or access advanced communications services, or for any
class of such equipment, for any provider of advanced communications
services, or for any class of such services, that --
(A) is capable of accessing an advanced communications service; and
(B) is designed for multiple purposes, but is designed primarily for
purposes other than using advanced communications services.480
Both the House and Senate Reports state that Section 716(h) "provides the Commission
with the flexibility to waive the accessibility requirements for any feature or function of a
device that is capable of accessing [ACS] but is, in the judgment of the Commission,
designed primarily for purposes other than accessing advanced communications."481
180.
In the Accessibility NPRM the Commission proposed to focus its waiver
inquiry on whether the offering is designed primarily for purposes other than using
ACS,482 and sought comment on substantive factors for its waiver analysis.483 The
Commission also sought comment generally on the waiver petition review process, and


480 47 U.S.C. 617(h)(1).
481 House Report at 26; Senate Report at 8.
482 Accessibility NPRM, 26 FCC Rcd at 3153, 53.
483 Accessibility NPRM, 26 FCC Rcd at 3153-54, 54-55.
77

Federal Communications Commission

FCC 11-151

the extent to which any procedures need to be adopted to ensure the process is effective
and efficient.484
181.
Discussion. We adopt the Commission's proposal to focus our waiver
inquiry on whether a multipurpose equipment or service has a feature or function that is
capable of accessing ACS but is nonetheless designed primarily for purposes other than
using ACS. This approach is founded in the statutory language.485 We disagree with the
IT and Telecom RERCs' assertion that our waiver analysis should focus on whether the
features or functions are designed primarily for purposes other than using ACS.486 The
statute specifically anticipates waivers for multipurpose equipment and services or classes
of such equipment and services with ACS features or functions.487 As the House and
Senate Reports explain, "a device designed for a purpose unrelated to accessing advanced
communications might also provide, on an incidental basis, access to such services. In
this case, the Commission may find that to promote technological innovation the
accessibility requirements need not apply."488
182.
We will exercise the authority granted under Section 716(h)(1) to waive
the requirements of Section 716489 through a case-by-case, fact-based analysis on our own
motion, or upon petition of a manufacturer of ACS equipment, a provider of ACS, or any
interested party.490 AT&T and CEA generally support this approach.491 As we discuss in
more detail below, the rule we adopt provides specific guidance on the two factors that
we will use to determine whether equipment or service is designed primarily for purposes
other than using ACS.
183.
We will examine whether the equipment or service was designed to be
used for advanced communications service purposes by the general public. We agree that
the language of the statute requires an examination of the purpose or purposes for which
the manufacturer or service provider designed the product or service and that consumer
use patterns may not always accurately reflect design.492 Therefore, this is not an
examination of post-design uses that consumers may find for a product; but rather, an


484 Accessibility NPRM, 26 FCC Rcd at 3154-55, 56-58.
485 47 U.S.C. 617(h)(1). Several commenters support this approach. See AT&T Comments at 7; CEA
Comments at 19; NetCoalition Comments at 6; VON Coalition Comments at 6.
486 IT and Telecom RERCs Comments at 17.
487 47 U.S.C. 617(h)(1).
488 House Report at 26; Senate Report at 8.
489 A waiver of the obligations of Section 716 also consequently relieves the waived entity from the
recordkeeping and annual certification obligations of Section 717. See 47 U.S.C. 618(a)(5).
490 47 U.S.C. 617(h)(1) (granting the Commission the authority to waive the requirements of Section 716
"on its own motion or in response to a petition by a manufacturer or provider of advanced communications
services or any interested party").
491 AT&T Comments at 6; CEA Comments at 17.
492 See CEA Comments at 19; CTIA Comments at 16-17; ESA Comments at 11; VON Coalition
Comments at 6.
78

Federal Communications Commission

FCC 11-151

analysis of the facts available to the manufacturer or provider and their intent during the
design phase. We may, for example, consider the manufacturer or provider's market
research, the usage trends of similar equipment or services, and other information to
determine whether a manufacturer or provider designed the equipment or service
primarily for purposes other than ACS.
184.
We note that equipment and services may have multiple primary, or co-
primary purposes, and in such cases a waiver may be unwarranted.493 Convergence
results in multipurpose equipment and services that may be equally designed for multiple
purposes, none of which are the exclusive primary use or design purpose. For instance,
many smartphones appear to be designed for several purposes, including voice
communications, text messaging, and e-mail, as well as web browsing, two-way video
chat, digital photography, digital video recording, high-definition video output, access to
applications, and mobile hotspot connectivity.494 The CVAA would have little meaning if
we were to consider waiving Section 716 with respect to the e-mail and text messaging
features of a smartphone on the grounds that the phone was designed in part for voice
communications.
185.
We will also examine whether the equipment or service is marketed for
the ACS features or functions. We agree with many commenters who suggest that how
equipment or a service is marketed is relevant to determining the primary purpose for
which it is designed.495 We will examine how and to what extent the ACS functionality
or feature is advertised, announced, or marketed and whether the ACS functionality or
feature is suggested to consumers as a reason for purchasing, installing, downloading, or
accessing the equipment or service.496 We believe the best way to address the IT and
Telecom RERCs' concern that a covered entity's assessment of how a product is
marketed may be "subjective and potentially self-serving"497 is to examine this factor on a
case-by-case basis and to solicit public comment on waiver requests, as discussed below.
186.
Several commenters suggest additional factors that we should consider
when examining the primary purpose for which equipment or service is designed. While
some of these factors may be valuable in some cases, we decline to incorporate these
factors directly into our rules. However, these factors may help a petitioner illustrate the


493 But see TIA Sept. 28 Ex Parte at 2 (urging the Commission to consider "a device's or service's single
primary purpose").
494 See Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993; Annual
Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless, Including
Commercial Mobile Services,
WT Docket No. 10-133 (Terminated), Fifteenth Report, FCC 11-103, 138-
144 (rel. June 27, 2011); Accessibility NPRM, 26 FCC Rcd at 3140-42, 15. See also Words+ and
Compusult Comments at 7.
495 AT&T Comments at 7; CEA Comments at 19-20; ESA Comments at 8; Microsoft Comments at 7;
NetCoalition Comments at 6; TechAmerica Comments at 5. See also TIA Sept. 28 Ex Parte at 2. But see
IT and Telecom RERCs Comments at 17; IT and Telecom RERCs Reply Comments at 2-3.
496 As ESA explains, "a marketing campaign for a new product or service is likely to focus upon the most
significant or attractive aspects of an offering's design." ESA Comments at 9.
497 IT and Telecom RERCs Reply Comments at 3.
79

Federal Communications Commission

FCC 11-151

purpose for which its equipment or service is primarily designed. For instance ESA
suggests we examine "[w]hether the ACS functionality intends to enhance another
feature or purpose."498 Microsoft similarly suggests we examine "[w]hether the offering
is designed for a `specific class of users who are using the ACS features in support of
another task' or as the primary task."499 Whether the ACS functionality is designed to be
operable outside of other functions, or rather aides other functions, may support a
determination that the equipment or service was or was not designed primarily for
purposes other than ACS. Similarly, an examination of the impact of the removal of the
ACS feature or function on a primary purpose for which the equipment or service is
claimed to be designed may be relevant to a demonstration of the primary purpose for
which the equipment or service is designed.500 Further, ESA suggests we examine
"[w]hether there are similar offerings that already have been deemed eligible for a . . .
waiver."501 An examination of waivers for similar products or services, while not
dispositive for a similar product or service, may be relevant to whether a waiver should
be granted for a subsequent similar product or service. These and other factors may be
relevant for a waiver petitioner, as determined on a case-by-case basis.
187.
Conversely, we believe there is little value in examining other suggested
factors on the record. We do not believe that the "processing power or bandwidth used to
deliver ACS vis--vis other features"502 is relevant. No evidence provided supports the
notion that there is a direct relationship between the primary purpose for which
equipment or service is designed and the processing power or bandwidth allocated to that
purpose. For example, text messaging on a wireless handset likely consumes less
bandwidth than voice telephony, but both could be co-primary purposes of a wireless
handset. Further, we do not believe that an examination of whether equipment or service
"provides a meaningful substitute for more traditional communications devices" adds
significantly to the waiver analysis.503 The waiver analysis requires an examination of
whether the equipment or service is designed primarily for purposes other than using
ACS. The inquiry therefore is about the design of the multipurpose service or equipment,
not the nature of the ACS component.504


498 ESA Comments at 8.
499 Microsoft Comments at 7 (citing Accessibility NPRM, 26 FCC Rcd at 3154, 55). ESA originally
suggested a similar formulation of this factor in its comments in response to the October Public Notice.
ESA Comments to October Public Notice at 8-9.
500 See IT and Telecom RERCs Comments at 17.
501 ESA Comments at 8.
502 ESA Comments at 8.
503 Microsoft Comments at 7.
504 We also disagree with the IT and Telecom RERCs' suggestion that "[w]aivers should not be provided to
an intentional communication function built into a larger non-communication product, but only to non-
communication functions that could incidentally be used to communicate." IT and Telecom RERCs
Comments at 18. Section 716 requires that the equipment or service for which a waiver is sought must be
capable of accessing ACS. 47 U.S.C. 617(h)(1)(A). A key requirement of any ACS is the ability to
communicate. Therefore, to even be eligible for a waiver, the equipment or service must include a
(continued....)
80

Federal Communications Commission

FCC 11-151

188.
In addition to the above factors we build into our rules and others that
petitioners may demonstrate, we intend to utilize our general waiver standard, which
requires good cause to waive the rules, and a showing that particular facts make
compliance inconsistent with the public interest.505 CEA agrees with this approach.506
The CVAA grants the Commission authority to waive the requirements of Section 716 in
its discretion,507 and we intend to exercise that discretion consistent with the general
waiver requirements under our rules.508
189.
We decline to adopt the waiver analysis proffered by AFB and supported
by ACB.509 AFB urges us to use the four achievability factors to examine waiver
petitions.510 We find that the achievability factors are inappropriate to consider in the
context of a waiver. A waiver relieves an entity of the obligations under Section 716,
including the obligation to conduct an achievability analysis.511 It would be counter to
the purpose of a waiver to condition its grant on an entity's ability to meet the obligations
for which it seeks a waiver. As discussed above, our waiver analysis will examine the
primary purpose or purposes for which the equipment or service is designed, consistent
with the statutory language.512
(Continued from previous page)


communication function. See AT&T Comments at 4. Finally, we disagree with AFB's argument that we
must affirmatively find that "the ACS functionality can only be used when the other product features
alleged by the petitioner to be the product's primary functions are being engaged by the user." AFB Reply
Comments at 10. While the relationship between the ACS feature or function and the claimed primary
purpose of equipment or service is designed is relevant, it is not necessarily dispositive.
505 47 C.F.R. 1.3; Northeast Cellular Telephone Co., L.P. v. FCC, 897 F.2d 1164, 1166 (D.C. Cir. 1990)
(citing WAIT Radio v. FCC, 418 F.2d 1153, 1159 (D.C. Cir. 1969)).
506 CEA Comments at 20 n.70 ("[T]he Commission should make clear that the waiver provision in the
CVAA complements, and does not supplant or replace, the Commission's general waiver and forbearance
authority under the Act."). CEA also included a public interest analysis in its waiver request filed on the
record in this proceeding. See Letter from Julie M. Kearny, Vice President, Regulatory Affairs, Consumer
Electronics Association to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 8-10 (filed July
19, 2011) ("CEA July 19 Ex Parte"). Further, in its reply comments, ESA included a public interest
analysis in its waiver request for "video game offerings." ESA Reply Comments at 16-20.
507 47 U.S.C. 617(h)(1); House Report at 26; Senate Report at 8.
508 CTIA believes that a discretionary process for waivers specifically the process proposed in the
Accessibility NPRM is contrary to "Congress's intent that the accessibility requirements not compromise
industry innovation and progress." CTIA Comments at 19. In CTIA's view, the Commission is required to
incorporate the statutory waiver language into its definition of ACS. See CTIA Comments at 19. Section
716(h)(1) plainly grants us the authority to waive the requirements of the Act, but does not direct us to do
so. See 47 U.S.C. 617(h)(1). Furthermore, use of the term "waive" in the statute and the reference to the
possibility of exercising that authority in response to petitions, clearly demonstrates that Congress intended
a waiver process. See House Report at 26; Senate Report at 8.
509 See AFB Reply Comments at 9-11; ACB Reply Comments at 23.
510 AFB Reply Comments at 9.
511 See 47 U.S.C. 617(h)(1) (granting the Commission the authority to "waive the requirements of Section
716").
512 See discussion supra para. 181.
81

Federal Communications Commission

FCC 11-151

190.
The factors we establish here will promote regulatory certainty and
predictability for providers of ACS, manufacturers of ACS equipment, and consumers.
We intend for these factors to provide clear and objective guidance to those who may
seek a waiver and those potentially affected by a waiver. Providers of ACS and ACS
equipment manufacturers have the flexibility to seek waivers for services and equipment
they believe meet the waiver requirements. While a provider or manufacturer will
expend some level of resources to seek a waiver, the provider or manufacturer
subsequently will have certainty regarding its obligations under the Act whether or not a
waiver is granted.513 If a waiver is warranted, the provider or manufacturer can then
efficiently allocate resources to other uses.
191.
We encourage equipment manufacturers and service providers to petition
for waivers during the design phase of the product lifecycle,514 but we decline to adopt the
proposal proffered by AFB to require petitioners to seek a waiver prior to product
introduction.515 The design phase is the ideal time to seek a waiver, but we will not
foreclose the ability of a manufacturer or provider to seek a waiver after product
introduction. AFB correctly observes: "If inaccessible equipment or services are first
deployed in the marketplace, and the subsequently-filed waiver petition is not granted,
the company would remain at tremendous risk of being found in violation of the CVAA's
access requirements and exposed to potential penalties."516 This reality should encourage
equipment and service providers to seek waivers during the design phase without
necessitating a mandate.
192.
The Commission will entertain waivers for equipment and services
individually or as a class. With respect to any waiver, the Commission may decide to
limit the time of its coverage, with or without a provision for renewal.517 Individual


513 A manufacturer or provider that receives a waiver will avoid the cost of compliance. A manufacturer or
provider that is not granted a waiver can determine its obligations under the Act following an achievability
analysis. The opportunity cost to seek a waiver is low since the alternative is compliance with the Act.
514 See ESA Comments at 2 ("To be practical . . . a manufacturer or provider must know its accessibility
obligations before making a product or service available, and thus prior to any consumer use."); CTIA
Comments at 18 ("[A]ccessibility must be considered early in the design process.").
515 AFB Reply Comments at 10.
516 AFB Reply Comments at 10.
517 Commenters disagree on the appropriate length of waivers and whether waivers should be renewed. For
example, the IT and Telecom RERCs, Consumer Groups, AAPD, Green, and ACB suggest that no waiver
should be permanent. Consumer Groups Comments at 13; IT and Telecom RERCs Comments at 19;
AAPD Reply Comments at 5; ACB Reply Comments at 23; Green Reply Comments at 12-13. Green,
ACB, and the IT and Telecom RERCs suggest waivers should last a maximum of 12 months. ACB Reply
Comments at 23; Green Reply Comments at 13; IT and Telecom RERCs Comments at 19. Consumer
Groups believe two years is sufficient. Consumer Groups Comments at 13. CEA argues for permanent
waivers because limitations on the life of a waiver are not in the statute, and "permanent waivers . . . help
reduce the burden on industry by eliminating the need to renew waivers." CEA Comments at 18. VON
Coalition argues that "[a]s long as ACS continues to be an ancillary function of the product and the
manufacturer or service provider is not designing or marketing the product based on its ACS features the
waiver should remain." VON Coalition Comments at 7. Verizon suggests all waivers should last a
minimum of 18 months. Verizon Comments at 9. TIA and TechAmerica assert that there should be no
(continued....)
82

Federal Communications Commission

FCC 11-151

waiver requests must be specific to an individual product or service offering.518 New or
different products, including substantial upgrades that change the nature of the product or
service, require new waivers.519 Individual waiver petitioners must explain the
anticipated lifecycle for the product or service for which the petitioner seeks a waiver.
Individual waivers will ordinarily be granted for the life of the product or service.520
However, the Commission retains the authority to limit the waiver for a shorter duration
if the record suggests the waiver should be so limited.
193.
We will exercise our authority to grant class waivers in instances in which
classes are carefully defined and when doing so would promote greater predictability and
certainty for all stakeholders.521 For the purpose of these rules, a class waiver is one that
applies to more than one piece of equipment or more than one service where the
equipment or services share common defining characteristics. For the Commission to
grant a class waiver, we will examine whether petitioners have defined with specificity
the class of common equipment or services with common advanced communications
features and functions for which they seek a waiver, including whether petitioners have
demonstrated the similarity of the equipment or service in the class and the similarity of
the ACS features or functions.522
194.
In addition, we will examine whether petitioners have explained in detail
the expected lifecycle for the equipment or services that are part of the class. Thus, the
(Continued from previous page)


arbitrary time limits on waivers and that waivers should remain in effect as long as the conditions under
which they were granted are met. TechAmerica Comments at 5; TIA Comments at 14-15. Green urges
that we not automatically renew waivers. Green Reply Comments at 13. Given the speed at which
communications technologies are evolving and the wide scope of devices and services covered by Section
716, it makes little sense for the Commission to establish a single length of time that would apply to all
waivers. Rather, the Commission will determine the appropriateness of time-limited waivers on a case-by-
case basis.
518 This does not preclude combining multiple specific products with common attributes in the same waiver
request.
519 For example, a petitioner that manufactures many similar types of products similar products of
varying design, or similarly designed products with different product numbers the petitioner must seek a
waiver for each discrete product individually. This is analogous to rules implementing Section 255, which
require entities to consider "whether it is readily achievable to install any accessibility features in a specific
product whenever a natural opportunity to review the design of a service or product arises." Section 255
Report and Order
, 16 FCC Rcd at 6447, 71.
520 See TechAmerica Comments at 5; TIA Comments at 14-15; VON Coalition Comments at 7.
521 47 U.S.C. 617(h)(1) (granting the Commission the authority to waive the requirements of Section 716
for classes of equipment and services).
522 We distinguish class waivers from categorical waivers. Several commenters urge us to adopt rules that
waive the requirements of Section 716 for whole categories of equipment or services. See TechAmerica
Comments at 5; TIA Comments at 13; Verizon Comments at 9; CTIA Reply Comments at 18-19. We
decline to adopt waivers for broad categories of equipment or services because we believe that the facts
specific to each product or product type within a category may differ such that the ACS feature or function
may be a primary purpose for which equipment or service within the category is primarily designed. We
will utilize a fact-specific, case-by-case determination of all waiver requests. See discussion supra para.
181.
83

Federal Communications Commission

FCC 11-151

definition of the class should include the product lifecycle. All products and services
covered by a class waiver that are introduced into the market while the waiver is in effect
will ordinarily be subject to the waiver for the duration of the life of those particular
products and services.523 For products and services already under development at the
time when a class waiver expires, the achievability analysis conducted at that time may
take into consideration the developmental stage of the product and the effort and expense
needed to achieve accessibility at that point in the developmental stage.
195.
To the extent a class waiver petitioner seeks a waiver for multiple
generations of similar equipment and services, we will examine the justification for the
waiver extending through the lifecycle of each discrete generation. For example, if a
petitioner seeks a waiver for a class of devices with an ACS feature and a two-year
product lifecycle, and the petitioner wishes to cover multiple generations of the product,
we will examine the explanation for why each generation should be included in the class.
If granted, the definition of the class will then include the multiple generations of the
covered products or services in the class.
196.
While many commenters agree that we should consider class waivers,524
we note that others are concerned that class waivers might lead to a "class of inaccessible
products and services"525 well beyond the time that a waiver should be applicable.526 We
believe this concern is addressed through our fact-specific, case-by-case analysis of
waiver petitions and the specific duration for which we will grant each class waiver.
197.
Several commenters urge us to adopt a time period within which the
Commission must automatically grant waiver petitions if it has not taken action on
them.527 We decline to do so. As the Commission noted in the Accessibility NPRM,528 in
contrast to other statutory schemes,529 the CVAA does not specifically contemplate a
"deemed granted" process. Nonetheless, we recognize the importance of expeditious
consideration of waiver petitions to avoid delaying the development and release of
products and services.530 We hereby delegate to the Consumer and Governmental Affairs
Bureau ("Bureau") the authority to decide all waiver requests filed pursuant to Section
716(h)(1) and direct the Bureau to take all steps necessary to do so efficiently and


523 As with ordinarily granting individual waiver requests for the life of the product or service, the
Commission retains the authority to limit a class waiver for a shorter duration if the record suggests the
waiver should be so limited. See discussion supra para 192.
524 See AT&T Comments at 5-7; CEA Comments at 17-18; ESA Comments at 13-15; Microsoft Comments
at 7; NetCoalition Comments at 7; VON Coalition Comments at 7.
525 Words+ and Compusult Comments at 20.
526 See IT and Telecom RERCs Comments at 19-20.
527 See AT&T Comments at 8; CTIA Comments at 18; ESA Comments at 16; TIA Comments at 14.
528 Accessibility NPRM, 26 FCC Rcd at 3155, 57.
529 See, e.g., 47 U.S.C. 160(c) (providing that any petition for forbearance shall be "deemed granted" if
the Commission does not deny the petition).
530 See CTIA Comments at 18; ESA Comments at 15-17; TIA Comments at 14.
84

Federal Communications Commission

FCC 11-151

effectively. Recognizing the need to provide certainty to all stakeholders with respect
to waivers, we urge the Bureau to act promptly to place waiver requests on Public Notice
and to give waiver requests full consideration and resolve them without delay. The
Commission also hereby adopts, similar to its timeline for consideration of applications
for transfers or assignments of licenses or authorizations relating to complex mergers, a
timeline for consideration of applications for waiver of the rules we adopt today. This
timeline represents the Commission's goal to complete action on such waiver
applications within 180 days of public notice. This 180-day timeline for action
is especially important in this context, given the need to provide certainty to both the
innovators investing risk capital to develop new products and services, as well as to the
stakeholders with an interest in this area. Therefore, it is the Commission's policy to
decide all such waiver applications as expeditiously as possible, and the Commission will
endeavor to meet its 180-day goal in all cases. Finally, although delay is unlikely, we
note that delay beyond the 180-day period in a particular case would not be indicative
of how the Commission would resolve an application for waiver.
198.
We emphasize that a critical part of this process is to ensure a sufficient
opportunity for public input on all waiver requests.531 Accordingly, our rules provide that
all waiver requests must be put on public notice, with a minimum of a 30-day period for
comments and oppositions. In addition, public notices seeking comment on waiver
requests will be posted on a webpage designated for disability-related waivers and
exemptions in the Disability Rights Office section of the Commission's website, where
the public can also access the accessibility clearinghouse532 and other accessibility-related
information. We will also include in our biennial report to Congress that is required
under Section 717(b)(1) a discussion of the status and disposition of all waiver requests.
199.
We recognize that confidentiality may be important for waiver
petitioners.533 Petitioners may seek confidential treatment of information pursuant to
section 0.459 of the Commission's rules.534 Several commenters agree with this
approach.535 Third parties may request inspection of confidential information under
section 0.461 of the Commission's rules.536 We anticipate that confidentiality may be
less important for class waiver petitions due to the generic nature of the request; a class
waiver petition can cover many devices, applications, or services across many covered
entities and will therefore not likely include specific confidential design or strategic
information of any covered entity.


531 See IT and Telecom RERCs Comments at 19; TechAmerica Comments at 5; ACB Reply Comments at
23.
532 See para. 6, supra.
533 See CEA Comments at 18; ESA Comments at 17.
534 47 C.F.R. 0.459.
535 See CEA Comments at 18; ESA Comments at 17; TechAmerica Comments at 5; VON Coalition at 7.
536 47 C.F.R. 0.461.
85

Federal Communications Commission

FCC 11-151

200.
ESA urges the Commission to exclude from final rules the class "video
game offerings," which it defines to include video game consoles, operating systems, and
games.537 CEA seeks a waiver for "[t]elevision sets that are enabled for use with the
Internet," and "[d]igital video players that are enabled for use with the Internet."538 We
decline to adopt or grant these requests at this time. Instead, we believe that petitioners
will benefit from the opportunity to re-file these waiver requests consistent with the
requirements of this Report and Order. Because of the phase-in period for
implementation of these rules,539 petitioners will have flexibility to seek a waiver
subsequent to this Report and Order without incurring unreasonable compliance expense.
We encourage petitioners to seek a waiver for their respective classes of equipment and
services consistent with the rules we adopt herein.540 We will specify in our biennial
Report to Congress541 any waiver requests granted during the previous two years.
3.

Exemptions for Small Entities Temporary Exemption of
Section 716 Requirements

201.
Background. Section 716(h)(2) states that "[t]he Commission may exempt
small entities from the requirements of this section."542 While the Senate Report did not
discuss this provision, the House Report notes that the Commission may "waive the
accessibility requirements for certain small businesses and entrepreneurial organizations"
because they "may not have the legal, financial, or technical capability to incorporate
accessibility features."543 Otherwise, the House Report notes, the "application of these
requirements in this limited case may slow the pace of technological innovation."544 It
also states that "the Commission is best suited to evaluate and determine which entities
may qualify for this exemption," and that it expects we will consult with the Small
Business Administration ("SBA") when defining the small entities that may qualify for
the exemption.545
202.
Compliance with the accessibility obligations under Section 716 is
generally required, unless compliance is not achievable. The achievability standard


537 ESA Reply Comments at 12. As an initial matter, we believe that if Congress had intended to exempt
services or equipment, it would have done so explicitly. Instead, Congress granted the Commission the
discretion to choose to grant waivers or to create an exemption for small entities; neither is compulsory.
See 47 U.S.C. 617(h)(1), (2). See also House Report at 26; Senate Report at 8.
538 CEA July 19 Ex Parte at 2.
539 See Phased in Implementation, Section III.A.5, supra.
540 For example, a petition for a waiver of equipment and services may need to seek a waiver for each as
individual classes, although they may file for them in the same petition.
541 47 U.S.C. 618(b).
542 47 U.S.C. 617(h)(2).
543 House Report at 26. In particular, the Report recognizes "the importance of small and entrepreneurial
innovators and the significant value that they add to the economy." Id.
544 House Report at 26.
545 House Report at 26.
86

Federal Communications Commission

FCC 11-151

provides a safeguard for all entities with obligations under Section 716.546 In determining
achievability, or in response to a complaint, any ACS provider or ACS equipment
manufacturer may demonstrate whether accessibility or compatibility with assistive
technology is or is not achievable based on the four achievability factors, including "[t]he
nature and cost of the steps needed" and "[t]he technical and economic impact on the
operation of the manufacturer or provider."547 Exempted small entities, on the other
hand, would be relieved of the substantive obligations to consider accessibility, conduct
an accessibility achievability analysis, or make their ACS products or services accessible
even if achievable, and as a consequence would be relieved of the associated
recordkeeping and annual certification requirements.548
203.
In the Accessibility NPRM, the Commission sought comment on whether
it should adopt any exemptions from compliance with Section 716 for small entities and,
if so, how it should structure the exemptions.549
204.
Discussion. We do not have before us a sufficient record upon which to
grant a permanent exemption for small entities.550 The record also lacks sufficient
information on the criteria to be used to determine which small entities to exempt. We
therefore seek comment on such an exemption in the accompanying Further Notice. To
avoid the possibility of unreasonably burdening "small and entrepreneurial innovators
and the significant value that they add to the economy,"551 we exercise our authority
under the Act to temporarily exempt from the obligations of Section 716, and by effect
Section 717,552 all manufacturers of ACS equipment and all providers of ACS that qualify
as small business concerns under the SBA's rules and size standards, pending
development of a record to determine whether small entities should be permanently
exempted and, if so, what criteria should be used to define small entities.553 We find that
good cause exists for this temporary exemption.554


546 See Achievable Standard, Section III.B.1, supra.
547 47 U.S.C. 617(g)(1), (2); see Achievable Standard, Section III.B.1, supra.
548 See 47 U.S.C. 618(a)(5); see Recordkeeping, Section III.E.1, supra. While Section 716(h)(2) of the
Act specifically authorizes the Commission to exempt small entities from the requirements of Section 716,
the recordkeeping and annual certification requirements of Section 717 are inapplicable to entities that do
not have to comply with the obligations of Section 716.
549 Accessibility NPRM, 26 FCC Rcd at 3157-58, 66.
550 Two commenters proffer specific grounds on which to base a small entity exemption. See NTCA
Comments; Blooston Rural Carriers Comments to October Public Notice. The current record lacks support
for adopting either proposal as a permanent exemption.
551 House Report at 26.
552 See note 557, supra.
553 See 13 C.F.R. 121.201.
554 See 5 U.S.C. 553(b)(B). Consistent with Congressional intent, we have consulted with the SBA in
coordination with the Commission's Office of Communications Business Opportunity. See House Report
at 26.
87

Federal Communications Commission

FCC 11-151

205.
Despite the lack of a meaningful substantive record on which to adopt a
permanent exemption, without a temporary exemption we run the risk of imposing an
unreasonable burden upon small entities and negatively impacting the value they add to
the economy.555 At the same time, the absence of meaningful comments on any
exemption criteria prohibits us from conclusively determining their impact on consumers
and businesses. This temporary exemption will enable us to provide relief to those
entities that may possibly lack legal, financial, or technical capability to comply with the
Act until we further develop the record to determine whether small entities should be
subject to a permanent exemption and, if so, the criteria to be used for defining which
small entities should be subject to such permanent exemption.
206.
We temporarily exempt entities that manufacture ACS equipment or
provide ACS that, along with any affiliates, meet the criteria for a small business concern
for their primary industry under SBA's rules and size standards.556 A small business
concern, as defined by the SBA, is an "entity organized for profit, with a place of
business located in the United States, and which operates primarily within the United
States or which makes a significant contribution to the U.S. economy through payment of
taxes or use of American products, materials or labor."557 Entities are affiliated under the
SBA's rules when an entity has the power to control another entity, or a third party has
the power to control both entities,558 as determined by factors including "ownership,
management, previous relationships with or ties to another concern, and contractual
relationships."559 A concern's primary industry is determined by the "distribution of
receipts, employees and costs of doing business among the different industries in which
business operations occurred for the most recently completed fiscal year,"560 and other
factors including "distribution of patents, contract awards, and assets."561
207.
The SBA has established maximum size standards used to determine
whether a business concern qualifies as a small business concern in its primary
industry.562 The SBA has generally adopted size standards based on the maximum


555 Further, given the short statutory deadline, we are unable to seek additional comment on a permanent
solution prior to the adoption of the Report and Order. We adopt the temporary exemption because we
believe it is necessary to grant immediate relief to all small entities pending development of a record to
determine whether small entities should be exempted, and if so, what criteria should be used to define small
entities.
556 13 C.F.R. 121.101 121.201.
557 13 C.F.R. 121.105(a)(1).
558 13 C.F.R. 121.103(a)(1).
559 13 C.F.R. 121.103(a)(2).
560 13 C.F.R. 121.107.
561 13 C.F.R. 121.107.
562 See 13 C.F.R. 121.201.
88

Federal Communications Commission

FCC 11-151

number of employees or maximum annual receipts of a business concern.563 The SBA
categorizes industries for its size standards using the North American Industry
Classification System ("NAICS"), a "system for classifying establishments by type of
economic activity."564 Below we identify some NAICS codes for possible primary
industry classifications of ACS equipment manufacturers and ACS providers and the
relevant SBA size standards associated with the codes.565

NAICS Classification566

NAICS Code

SBA Size Standard567

Wired Telecommunications Carriers
517110
1,500 or fewer
employees
Wireless Telecommunications Carriers
517210
1,500 or fewer
(except satellites)
employees
Telecommunications Resellers
517911
1,500 or fewer
568
employees
All Other Telecommunications
517919
$25 million or less in
annual receipts

Services

Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
Data Processing, Hosting, and Related
518210
$25 million or less in
Services
annual receipts


563 13 C.F.R. 121.106 (describing how number of employees is calculated); 13 C.F.R. 121.104
(describing how annual receipts is calculated).
564 North American Industry Classification System; Revision for 2012, 76 Fed. Reg. 51240 (Aug. 17, 2011)
("NAICS Final Decision").
565 This is not a comprehensive list of the primary industries and associated SBA size standards of every
possible manufacturer of ACS equipment or provider of ACS. This list is merely representative of some
primary industries in which entities that manufacture ACS equipment or provide ACS may be primarily
engaged. It is ultimately up to an entity seeking the temporary exemption to make a determination
regarding their primary industry, and justify such determination in any enforcement proceeding.
566 The definitions for each NAICS industry classification can be found by entering the six digit NAICS
code in the "2007 NAICS Search" function available at the NAICS homepage,
http://www.census.gov/eos/www/naics/index.html. The U.S. Office of Management and Budget has
revised NAICS for 2012, however, the codes and industry categories listed herein are unchanged. OMB
anticipates releasing a 2012 NAICS UNITED STATES MANUAL or supplement in January 2012. See NAICS
Final Decision
, 76 Fed. Reg. at 51240.
567 See 13 C.F.R. 121.201 for a full listing of SBA size standards by six-digit NAICS industry code. The
standards listed in this column establish the maximum size an entity in the given NAICS industry may be to
qualify as a small business concern.
568 See Providers of Advanced Communications Services, Section III.A.3, supra.
89

Federal Communications Commission

FCC 11-151

Radio and Television Broadcasting and
334220
750 or fewer
Wireless Communications Equipment
employees
Manufacturing
Electronic Computer Manufacturing
334111
1,000 or fewer
569
employees
Telephone Apparatus Manufacturing
334210
1,000 or fewer
employees
Other Communications Equipment
334290
750 or fewer

Equipment

Manufacturing
employees
Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
208.
This temporary exemption is self-executing. Entities must determine
whether they qualify for the exemption based upon their ability to meet the SBA's rules
and the size standard for the relevant NAICS industry category for the industry in which
they are primarily engaged. Entities that manufacture ACS equipment or provide ACS
may raise this temporary exemption as a defense in an enforcement proceeding. Entities
claiming the exemption must be able to demonstrate that they met the exemption criteria
during the estimated start of the design phase of the lifecycle of the product or service
that is the subject of the complaint. If an entity no longer meets the exemption criteria, it
must comply with Section 716 and Section 717 for all subsequent products or services or
substantial upgrades of products or services that are in the development phase of the
product or service lifecycle, or any earlier stages of development, at the time they no
longer meet the criteria.570
209.
The temporary exemption will begin on the effective date of the rules
adopted in this Report and Order.571 The temporary exemption will expire on the earlier
of (1) the effective date of small entity exemption rules adopted pursuant to the Further
Notice
; or (2) October 8, 2013.

D.

Additional Industry Requirements and Guidance

1.

Performance Objectives

210.
Background. Section 716(e)(1)(A) of the Act provides that in prescribing
regulations for this section, the Commission shall "include performance objectives to


569 See Manufacturers of Equipment Used for Advanced Communications Services, Section III.A.2, supra.
570 Covered entities must consider accessibility, and whether accessibility is achievable, during product
design. See Achievable Standard, Section III.B.1, supra. Covered entities must also comply with the
recordkeeping and annual certification obligations in Section 717 of the Act. 47 U.S.C 618(a)(5); see
Recordkeeping, Section III.E.1, supra. Since the small entity exemption relieves entities of the obligation
to conduct an achievability analysis, the exemption focuses on the characteristics of the entity (employee
figures or annual receipt data) during the design phase of the product lifecycle.
571 See Phased in Implementation, Section III.A.5, supra.
90

Federal Communications Commission

FCC 11-151

ensure the accessibility, usability, and compatibility of advanced communications
services and the equipment used for advanced communications services by individuals
with disabilities."572
211.
Discussion. As proposed in the Accessibility NPRM,573 we adopt as
general performance objectives the requirements that covered equipment and services be
accessible, compatible and usable. We incorporate into these general performance
objectives the outcome-oriented definitions of accessible,574 compatibility575 and usable,576
contained in sections 6.3 and 7.3 of the Commission's rules. Most commenters in the
record support this approach.577 The IT and Telecom RERCs, however, disagree and
propose that we reframe our Part 6 requirements as goals and testable performance
criteria.578 Because the IT and Telecom RERCs filed their proposal in their Reply
Comments, we seek comment in the accompanying Further Notice on the IT and
Telecom RERCs' general approach and on specific testable performance criteria.579
212.
We do not adopt specific performance objectives at this time. As we
discuss in greater detail in Performance Objectives, Section IV.F, infra, we will defer
consideration of specific performance criteria until the Access Board adopts Final
Guidelines.580 As proposed in the Accessibility NPRM,581 we will wait until after the


572 47 U.S.C. 617(e)(1)(A).
573 Accessibility NPRM, 26 FCC Rcd at 3172, 105.
574 See 47 C.F.R. 6.3(a) which provides that "input, control, and mechanical functions shall be locatable,
identifiable, and operable" as follows:
-Operable without vision
-Operable with low vision and limited or no hearing
-Operable with little or no color perception
-Operable without hearing
-Operable with limited manual dexterity
-Operable with limited reach or strength
-Operable without time-dependent controls
-Operable without speech
-Operable with limited cognitive skills
575 47 C.F.R. 6.3(b)(1-4).
576 47 C.F.R. 6.3(l). Section 6.3(l) provides that "usable" "mean[s] that individuals with disabilities have
access to the full functionality and documentation for the product, including instructions, product
information (including accessible feature information), documentation, and technical support functionally
equivalent to that provided to individuals without disabilities."
577 CEA Comments at 29; Consumer Groups Comments at 22; TIA Comments at 30, 33; T-Mobile
Comments at 12; Verizon Comments at 13; Wireless RERC Comments at 6; Words + Compusult
Comments at 29; Consumer Groups Reply Comments at 6; T-Mobile Reply Comments at 14. But see
Microsoft Comments at 13-14.
578 IT and Telecom RERCs Reply Comments at 5.
579 See Performance Objectives, Section IV.F, infra.
580 TIA Comments at 32-33.
581 Accessibility NPRM, 26 FCC Rcd at 3172, 107.
91

Federal Communications Commission

FCC 11-151

EAAC provides its recommendations on issues relating to the migration to IP-enabled
networks, including the adoption of a real-time text standard, to the Commission in
December 2011 to update our performance objectives, as appropriate.582
2.

Safe Harbors

213.
Background. Section 716(e)(1)(D) of the Act provides that the
Commission "shall . . . not mandate technical standards, except that the Commission may
adopt technical standards as a safe harbor for such compliance if necessary to facilitate
the manufacturers' and service providers' compliance" with the accessibility and
compatibility requirements in Section 716.583
214.
The vast majority of commenters responding to the October Public Notice
opposed establishing technical standards as safe harbors.584 CTIA and AT&T asserted
that safe harbors would result in de facto standards being imposed that would limit the
flexibility of covered entities seeking to provide accessibility.585 The IT and Telecom
RERCs stated that the Commission's rules should not include safe harbors because
"technology, including accessibility technology, will develop faster than law can keep
up."586 AFB asserted that it is too early in the CVAA's implementation "to make
informed judgments . . . about whether and which safe harbors should be available."587
While ITI supported safe harbors, noting they provide clarity and predictability, it warned
against using safe harbors "to establish implicit mandates [that] . . . lock in particular
solutions."588 In light of the concerns raised in the record, the Commission proposed not
to adopt any technical standards as safe harbors, and sought comment on its proposal.589
215.
Discussion. We decline, at this time, to adopt any technical standards as
safe harbors. The majority of commenters either oppose the Commission adopting
technical standards as safe harbors or only support the adoption of safe harbors subject to
important limitations and qualifications.590 CEA, for example, argues that safe harbors


582 See AFB Reply Comments at 13 (arguing that this rulemaking informs the work of the EAAC).
583 47 C.F.R. 617(e)(1)(D).
584 AT&T Comments to October Public Notice at 7; CEA Comments to October Public Notice at ii and 15;
CTIA Comments to October Public Notice at 11-12; RERC-IT Comments to October Public Notice at 8;
ACB Reply Comments to October Public Notice at 22; AFB Reply Comments to October Public Notice at
7; CTIA Reply Comments to October Public Notice at 5; RERC-IT Reply Comments to October Public
Notice
at 7.
585 AT&T Comments to October Public Notice at 7; CTIA Comments to October Public Notice at 11..
586 RERC-IT Reply Comments to October Public Notice at 7.
587 AFB Reply Comments to October Public Notice at 7. ACB urges that if the Commission establishes
safe harbors, it provide a framework for assessing these standards. ACB Reply Comments to October
Public Notice
at 21-22.
588 ITI Comments to October Public Notice at 10.
589 See, e.g., CEA Comments to October Public Notice at 15; Microsoft Comments to October Public
Notice
at 3.
590 CEA Comments at 39; IT and Telecom RERCs Comments at 38; ITI Comments at 17; TechAmerica
Comments at 9; TIA Comments at 32 (arguing that the Commission should not mandate certain standards,
(continued....)
92

Federal Communications Commission

FCC 11-151

should only be used in limited circumstances and warns that the Commission should not
lock in outdated technologies or impose implicit mandates.591 The IT and Telecom
RERCs assert that APIs should be encouraged, but should not be a safe harbor.592 ITI,
however, argues that we should adopt safe harbors as a "reliable and sustainable method
to achieve interoperability between" all of the components necessary to make ACS
accessible.593 AFB and Words+ and Compusult argue that it is still too early in the
implementation of the CVAA to make informed judgments about whether safe harbor
technical standards should be established.594 We do not have enough of a record at this
time to evaluate ITI's proposal or to decline to adopt a safe harbor, and seek further
comment on this issue in the accompanying Further Notice.595
3.

Prospective Guidelines

216.
Background. Section 716(e)(2) of the Act requires the Commission to
issue prospective guidelines concerning the new accessibility requirements.596 While the
Senate Report did not discuss this provision, the House Report notes that such guidance
"makes it easier for industry to gauge what is necessary to fulfill the requirements" by
providing industry with "as much certainty as possible regarding how the Commission
will determine compliance with any new obligations."597
217.
In the Accessibility NPRM, the Commission sought comment on a
proposal by the RERC-IT, endorsed by ACB, that the Commission use "an approach to
the guidelines similar to that used by the World Wide Web Consortium's Web Content
Accessibility Guidelines, which provide mandatory performance-based standards and
non-mandatory technology-specific techniques for meeting them."598 The Commission
also sought comment on whether any parts of the Access Board's Draft Guidelines on
Section 508 should be adopted as prospective guidelines.599 In addition, the Commission
(Continued from previous page)


but supporting the use of industry-developed technical standards as a safe harbor for compliance where
necessary); VON Coalition Comments at 7-8; Words+ and Compusult Comments at 32; Letter from Ken J.
Salaets, Director Information Technology Industry Council, to Marlene H. Dortch, Secretary, FCC, CG
Docket No. 10-213, at 3 (filed June 10, 2010).
591 CEA Comments at 39.
592 IT and Telecom RERCs Reply Comments at 4.
593 ITI August 9 Ex Parte at 2. See also Letter from Ken J. Salaets, Director, Information Technology
Industry Council, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213 (filed Aug. 22, 2011)
("ITI August 11 Ex Parte").
594 AFB Reply Comments to October Public Notice at 7; Words+ and Compusult Comments at 32.
595 Safe Harbors, Section IV.G, infra.
596 47 U.S.C. 617(e)(2).
597 See House Report at 25.
598 Accessibility NPRM, 26 FCC Rcd at 3175, 115; RERC-IT Comments to October Public Notice at 8;
ACB Reply Comments to October Public Notice at 22.
599 Accessibility NPRM, 26 FCC Rcd at 3175, 115. We note that some in industry expressed concern
about incorporating parts of the Access Board Draft Guidelines as prospective guidelines. See, e.g., CTIA
PN Comments at 12, finding that the Access Board Draft Guidelines were "insufficiently clear to provide
(continued....)
93

Federal Communications Commission

FCC 11-151

sought comment on the process for developing prospective guidelines, including asking
whether the Commission should establish a consumer-industry advisory group to prepare
guidelines.600
218.
Discussion. We generally agree with CEA that because the Access
Board's draft guidelines "may still change significantly," we should allow the Access
Board to complete its review and issue Final Guidelines before we adopt prospective
guidelines in accordance with Section 716(e)(2) of the Act.601 We agree with the IT and
Telecom RERCs that the Commission does not need to create a separate advisory group
to generate prospective guidelines.602 We believe that the Access Board will take into
account the "needs of specific disability groups, such as those with moderate to severe
mobility and speech disorders."603 Accordingly, we will conduct further rulemaking to
develop the required prospective guidelines after the Access Board issues its Final
Guidelines.

E.

Section 717 Recordkeeping and Enforcement

1.

Recordkeeping

219.
Background. Section 717(a)604 requires the Commission to establish new
recordkeeping and enforcement procedures for manufacturers and service providers that
are subject to Sections 255, 716, and 718 of the Act.605 Section 717(a)(5)(A) requires
such manufacturers and service providers to "maintain, in the ordinary course of business
and for a reasonable period, records of the efforts taken by such manufacturer or provider
to implement Sections 255, 716, and 718, including the following: (i) Information about
the manufacturer's or provider's efforts to consult with individuals with disabilities. (ii)
Descriptions of the accessibility features of its products and services. (iii) Information
about the compatibility of such products and services with peripheral devices or
specialized customer premise equipment commonly used by individuals with disabilities
to achieve access."606 The statute establishes a one-year period for phasing in the
recordkeeping requirements (i.e., the recordkeeping requirement starts one year after the
effective date of the rule),607 as well as an annual certification of compliance
(Continued from previous page)


useful guidance" and "did not offer manufacturers and providers sufficient technological flexibility to
enable a seamless transition from traditional devices to IP-based technologies."
600 Accessibility NPRM, 26 FCC Rcd at 3175, 115.
601 CEA Comments at 38; CEA Reply Comments at 18; 47 U.S.C. 617(e)(2). See also TIA Comments at
32-33. But see CTIA Sept. 30 Ex Parte at 1 (stating that "it would be contrary to the intent of the statute to
subject manufacturers and service providers to an entirely new enforcement regime for services and
equipment developed before the Commission articulated a clear set of guidelines for compliance.")
602 IT and Telecom RERCs Comments at 39.
603 Words+ and Compusult Comments at 33.
604 47 U.S.C. 618(a).
605 47 U.S.C. 255, 617, 619.
606 47 U.S.C. 618(a)(5)(A)(i)-(iii).
607 Accessibility NPRM, 26 FCC Rcd at 3178-79, 123.
94

Federal Communications Commission

FCC 11-151

requirement.608 It also extends a statutory right to confidentiality to cover those records
that our rules require a manufacturer or service provider to keep and produce and that are
relevant to an informal complaint.609 In the Accessibility NPRM, the Commission sought
comment on implementation of the statutory requirement.
220.
Discussion. In this Report and Order, we adopt rules to implement
Congress's directive that manufacturers and service providers maintain "records of the
efforts taken by such manufacturer or provider to implement Sections 255, 716, and
718."610 Specifically, we require covered entities to keep the three sets of records
specified in the statute.611 However, we remind covered entities that do not make their
products or services accessible and claim as a defense that it is not achievable for them to
do so, that they bear the burden of proof on this defense.612 As a result, while we do not
require manufacturers and service providers that intend to make such a claim to create
and maintain any particular records relating to that claim, they must be prepared to carry
their burden of proof.613 Conclusory and unsupported claims are insufficient and will
cause the Commission to rule in favor of complainants that establish a prima facie case
that a product or service is inaccessible and against manufacturers or service providers
that assert, without proper support, that it was not achievable for them to make their
product or service accessible.
221.
In this regard, manufacturers and service providers claiming as a defense
that it is not achievable must be prepared to produce sufficient records demonstrating:

the nature and cost of the steps needed to make equipment and
services accessible in the design, development, testing, and
deployment process614 to make a piece of equipment or software in


608 Accessibility NPRM, 26 FCC Rcd at 3176, 117.
609 47 U.S.C. 618(a)(5)(C).
610 47 U.S.C. 618(a)(5)(A).
611 47 U.S.C. 618(a)(5)(A)(i)-(iii).
612 See, e.g., AFB Comments at 7 ("[T]he plain meaning of the CVAA is that a covered entity has the
burden of proof in demonstrating that it was/is not achievable to afford access to people with disabilities in
a given context.").
613 This is consistent with the Commission's approach set forth in the Section 255 Report and Order. In
the Section 255 Report and Order, the Commission declined to delineate specific documentation
requirements for the "readily achievable" analysis, but stated that it "fully expect[ed]" covered entities to
maintain records of their efforts during the ordinary course of business that could be presented to the
Commission to demonstrate compliance. Section 255 Report and Order, 16 FCC Rcd at 6448, 74.
Likewise, while the Section 255 "readily achievable" factors differ from the "achievable" factors set out in
the CVAA, manufacturers and service providers subject to Section 255 claiming such a defense bear the
burden of proof under the factors set out in the Section 255 Report and Order and our rules. See Section
255 Report and Order
, 16 FCC Rcd at 6439-40, 48; see also 47 C.F.R. 7.3(h).
614
Expert affidavits, attesting that accessibility for a product or service was not achievable, created after a
complaint is filed or the Commission launches its own investigation would not satisfy this burden.
Samuelson-Glushko TLPC argues that "[u]ser testing requirements are vital to ensure usable and viable
technology access to citizens with disabilities." Samuelson-Glushko Reply Comments at 4. While we will
(continued....)
95

Federal Communications Commission

FCC 11-151

the case of a manufacturer, or service in the case of a service
provider, usable by individuals with disabilities;615

the technical and economic impact on the operation of the
manufacturer or provider and on the operation of the specific
equipment or service in question, including on the development
and deployment of new communications technologies;

the type of operations of the manufacturer or service provider; and,

the extent to which the service provider or manufacturer in
question offers accessible services or equipment containing
varying degrees of functionality and features, and offered at
differing price points.616
222.
Likewise, equipment manufacturers and service providers that elect to
satisfy the accessibility requirements using third-party applications, peripheral devices,
software, hardware, or customer premises equipment must be prepared to produce
relevant documentation.617
223.
We will not mandate any one form for keeping records (i.e., we adopt a
flexible approach to recordkeeping). While we establish uniform recordkeeping and
enforcement procedures for entities subject to Sections 255, 716, and 718, we believe that
covered entities should not be required to maintain records in a specific format.618
(Continued from previous page)


not impose specific user testing requirements, we support the practice of user testing and agree with
Samuelson-Glushko that user testing benefits individuals with a wide range of disabilities. Samuelson-
Glushko Reply Comments at 4-5.
615 While we do not define here what cost records a covered entity should keep, in reviewing a defense of
not achievable, we will expect such entities to produce records that will assist the Commission in
identifying the incremental costs associated with designing, developing, testing, and deploying a particular
piece of equipment or service with accessibility functionality versus the same equipment or service without
accessibility functionality. Additionally, with respect to services, covered entities should be prepared to
produce records that identify the average and marginal costs over the expected life of such service.
Records that front load costs to demonstrate that accessibility was not achievable will be given little weight.
616 47 U.S.C. 617(g)(1)-(4).
617 Sections 617(a)(2)(B) and (b)(2)(B) allow manufactures and service providers, respectively, to use third
party applications, peripheral devices, software, hardware, or customer premises equipment to satisfy their
accessibility requirements, provided they can be accessed by individuals with disabilities and are available
at nominal cost.
618 While we are not requiring that records and documents be kept in any specific format, we exercise our
authority and discretion under Sections 403, 4(i), 4(j), 208 and other provisions of the Act and Commission
and court precedent to require production of records and documents in an informal and formal complaint
process or in connection with investigations we initiate on our own motion in any form that is conducive to
the dispatch of our obligation under the Act, including electronic form and formatted for specific
documents review software products such as Summation, as well as paper copies. In addition, we require
that all records filed with the Commission be in the English language. Where records are in a language
other than English, we require the records to be filed in the native language format accompanied by a
certified English translation. We adopt our proposal in the Accessibility NPRM that if a record that a
(continued....)
96

Federal Communications Commission

FCC 11-151

Allowing covered entities the flexibility to implement individual recordkeeping
procedures takes into account the variances in covered entities (e.g., size, experience with
the Commission), recordkeeping methods, and products and services covered by the
provisions.619
224.
While we are not requiring entities to adopt a standard approach to
recordkeeping, we fully expect that entities will establish and sustain effective internal
procedures for creating and maintaining records that demonstrate compliance efforts and
allow for prompt response to complaints and inquiries. As noted in the Section 255
Report and Order
, if we determine that covered entities are not maintaining sufficient
records to respond to Commission or consumer inquiries, we will revisit this decision.620
225.
The statute requires manufacturers and service providers to preserve
records for a "reasonable time period."621 Pursuant to this requirement, we adopt a rule
that requires a covered entity to retain records for a period of two years from the date the
covered entity ceases to offer or in anyway distribute (through a third party or reseller)
the product or service to the public. In determining what constitutes a reasonable time
period, we believe that records should at a minimum be retained during the time period
that manufacturers and providers are offering the applicable products and services to the
public. We also believe that a reasonable time period should be linked to the life cycle of
the product or service and that covered entities should retain records for a reasonable
period after they cease to offer a product or service (or otherwise distribute a product or
service through a reseller or other third party). In this regard, based on our experience
with other enforcement issues, we note that purchasers of products or services might not
file a complaint for up to a year after they have purchased such products or services and
that the statute places no limitation preventing consumers from doing this. In addition,
some consumers might purchase a product or service from another party one year after
the covered entity has ceased making and offering the covered product or service. These
`resale' consumers in turn might take up to an additional year to file an accessibility
complaint. At the same time, as discussed further in our Enforcement Section below, the
Commission may initiate an enforcement investigation into an alleged violation of
Section 255, 716, or 718 based on information that a consumer, at any time, brings to the
Commission's attention. These documents would thus be relevant to a Commission-
initiated investigation. For these reasons, we find that covered entities must retain
records for two years after they cease offering (or in any way distributing) a covered
product or service to the public.
(Continued from previous page)


covered entity must produce "is not readily available, the covered entity must provide it no later than the
date of its response to the complaint." Accessibility NPRM, 26 FCC Rcd at 3178-79, 123.
619 Accessibility NPRM, 26 FCC Rcd at 3178-79, 123. In the Section 255 Report and Order, the
Commission also declined to mandate specific efforts or formats for the information collection, and instead
held that "companies should have flexibility in addressing this issue." Section 255 Report and Order, 16
FCC Rcd at 6482, 172.
620 Section 255 Report and Order, 16 FCC Rcd at 6482, 172.
621 47 U.S.C. 618(a)(5)(A).
97

Federal Communications Commission

FCC 11-151

226.
This will enable consumers to file complaints and the Commission to
initiate its own investigations to ensure that, even if the product or service at issue in the
complaint is not compliant, the next generation or iteration of the product or service is
compliant. Because covered entities must comply with Sections 255, 716, and 718, we
find that this two-year document retention rule imposes a minimal burden on covered
entities because it ensures that they have the necessary documentation to prove that they
have satisfied their legal obligations in response to any complaint filed. Covered entities
are reminded, however, that, even upon the expiration of the mandatory two-year
document retention rule, it is incumbent on them to prove accessibility or that
accessibility was not achievable in the event that a complaint is received. Thus, covered
entities should use discretion in setting their record retention policies applicable to the
post-two-year mandatory record retention period.
227.
The statute requires that an officer of a manufacturer or service provider
annually submit to the Commission a certification that records required to be maintained
are being kept in accordance with the statute.622 We adopt a rule requiring manufacturers
and service providers to have an authorized officer sign and file with the Commission the
annual certification required pursuant to Section 717(a)(5)(B) and our rules.623 The
certification must state that the manufacturer or service provider, as applicable, is keeping
the records required in compliance with Section 717(a)(5)(A) and section 14.31 of our
new rules and be supported with an affidavit or declaration under penalty of perjury,
signed and dated by the authorized officer of the company with personal knowledge of
the representations provided in the company's certification, verifying the truth and
accuracy of the information therein. All such declarations must comply with section 1.16
of our rules and be substantially in the form set forth therein.624 We also require the
certification to identify the name and contact details of the person or persons within the
company that are authorized to resolve complaints alleging violations of our accessibility
rules and Sections 255, 716, and 718 of the Act, and the name and contact details of the
person in the company for purposes of serving complaints under Part 14, Subpart D of
our new rules.625 Finally, the annual certification must be filed with the Commission on
or before April 1st each year for records pertaining to the previous calendar year.626


622 47 U.S.C. 618(a)(5)(B).
623 47 U.S.C. 618(a)(5)(B). If the manufacturer or service provider is an individual, the individual must
sign. In the case of a partnership, one of the partners must sign on behalf of the partnership and by a
member with authority to sign in cases where the manufacturer or service provider is, for example, an
unincorporated association or other legal entity that does not have an officer or partner, or its equivalent.
624 See 47 C.F.R. 1.16.
625 The contact details required for purposes of complaints and service must be the U.S. agent for service
for the covered entity. This information will be posted on the FCC's website.
626 CGB will issue a public notice to provide filing instructions prior to the first annual certification, which
may be required on or before April 1, 2013. For the first certification filing, manufacturers and service
providers must certify that, since the effective date of the rules, records have been kept in accordance with
the Commission's rules. CGB will establish a system for online filing of annual certifications. When this
system is available, CGB will release a public notice announcing this fact and providing instructions on its
(continued....)
98

Federal Communications Commission

FCC 11-151

228.
Section 717(a)(5)(C) requires the Commission to keep confidential only
those records that are: (1) filed by a covered entity at the request of the Commission in
response to a complaint; (2) created or maintained by the covered entity pursuant to the
rules we adopt today; and (3) directly relevant to the equipment or service that is the
subject of the complaint.627 Section 717(a)(5)(C) does not require all records that the
Commission may request a covered entity file in response to a complaint be kept
confidential only those records that the covered entity is required to keep pursuant to
our rules adopted herein and are directly relevant to the equipment or service at issue.
Section 717(a)(5)(C) also does not protect any additional materials such as supporting
data or other information that proves the covered entity's case, nor does it protect records
that covered entities are required to keep when responding to a Commission investigation
initiated on our own motion.
229.
While we recognize the limited scope of the confidentiality protection of
Section 717(a)(5)(C), we also recognize that some of the documents falling outside that
protection may also qualify for confidentiality under our rules. For those documents
submitted in response to a complaint or an investigation, covered entities should follow
our existing rules and procedures for protecting confidentiality of records. Accordingly,
when a covered entity responds to a complaint alleging a violation of Section 255, 716, or
718 or responds to a Commission inquiry, the covered entity may request confidential
treatment of the documentation, information, and records that it files with the
Commission under section 0.459 of our rules.628 When covered entities file records that
fall within the limited scope of Section 717(a)(5)(C), they may assert the statutory
exemption from disclosure under section 0.457(c) of the Commission's rules.629 In all
other cases, covered entities must comply with section 0.459 when seeking protection of
their records.630
(Continued from previous page)


use. CGB will also update the Disability Rights Office section of the Commission's website to describe
how annual certifications may be filed.
627 47 U.S.C. 618(a)(5)(C).
628 47 C.F.R. 0.459.
629 47 C.F.R. 0.457(c). By adopting this process, we see no need to adopt TIA's proposal that we
specifically amend section 0.457(c) to include Section 717(a)(5)(C) materials. Letter from Mark Uncapher,
Director, TIA, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 3 (filed Aug. 26, 2011).
We require covered entities to include with their confidentiality requests under Section 0.459 a statement
identifying which records, if any, it is asserting a statutory protection under Section 618(a)(5)(C) and to
submit a redacted version of these records for the public file together with redacted versions of the
documents and information it requests confidential treatment under section 0.459.
630 See 47 C.F.R. 0.459. We remind covered entities that our rules require such entities to file a redacted
copy of their response to a complaint or investigation. We do not believe it serves the public interest of the
parties in a complaint process for the Commission to try to determine in the first instance what documents
and records the filing party wishes be kept confidential. The party filing documents with the Commission
is best suited to make that initial determination. We note that our informal complaint rules require the
responding covered entity to serve a non-confidential summary of its complaint answer to the complainant.
See Informal Complaints, Section III.E.2.c, infra.
99

Federal Communications Commission

FCC 11-151

230.
Finally, as discussed earlier in this Report and Order, products or services
offered in interstate commerce shall be accessible, unless not achievable, beginning on
October 8, 2013.631 Pursuant to the statute, one year after the effective date of these
regulations, covered entities' recordkeeping obligations become effective.632
2.

Enforcement

a.

Overview

231.
Section 717 of the Act requires the Commission to adopt rules that
facilitate the filing of formal and informal complaints alleging non-compliance with
Section 255, 716, or 718 and to establish procedures for enforcement actions by the
Commission with respect to such violations, within one year of enactment of the law.633
In crafting rules to implement the CVAA's enforcement requirements, our goal is to
create an enforcement process that is accessible and fair and that allows for timely
determinations, while allowing and encouraging parties to resolve matters informally to
the extent possible.
b.

General Requirements

232.
Background. In the Accessibility NPRM, the Commission sought
comment on whether to require potential complainants to first notify the defendant
manufacturer or provider of their intent to file a complaint with the Commission based on
an alleged violation of one or more provisions of Section 255, 716, or 718.634 The
Commission invited proposals on potential safeguards that the Commission could adopt
to ensure that any pre-filing requirement established under the new rules is not onerous
on potential complainants.635 In addition, the Commission proposed in the Accessibility
NPRM
not to adopt a standing requirement in order to file a formal or informal complaint
under Section 255, 716, or 718.636
233.
Discussion. Several commenters suggest that a type of pre-filing notice to
potential defendants may facilitate the speedy settlement of consumer disputes, which,
they say, would save consumers and industry time and money and preserve Commission
resources that would otherwise be expended in the informal complaint process.637 These


631 See Phased in Implementation, Section III.A.5, supra.
63247 U.S.C. 618(a)(5)(A).
633 47 U.S.C. 618(a).
634 Accessibility NPRM, 26 FCC Rcd at 3181-82, 128.
635 Accessibility NPRM, 26 FCC Rcd at 3181-82, 128.
636 Accessibility NPRM, 26 FCC Rcd at 3181-82, 130.
637 See AT&T Comments at 13-14 (arguing that the "vast majority of complaints" may be resolved before
they reach the Commission); CEA Comments at 31-32; CTIA Comments at 31-32 (encouraging the
Commission to "foster an environment that facilitates greater communication among the parties and
informal resolution of concerns wherever possible"). See also Section 255 Report and Order, 16 FCC Rcd
at 6467, 119 (encouraging consumers to raise their concerns with manufacturers or service providers prior
to filing a Section 255 complaint).
100

Federal Communications Commission

FCC 11-151

commenters urge the Commission to require potential complainants to notify covered
entities of their intent to file an informal complaint generally 30 days before they intend
to file such a complaint.638 Others, however, have reported that consumers would
experience frustration if required to pre-notify a covered entity directly.639 We recognize
the potential benefits of allowing companies an opportunity to respond directly to the
concerns of consumers before a complaint is filed. At the same time, we are cognizant of
the difficulties that consumers may have in achieving resolution of their issues on their
own. For example, consumers may not always be able to figure out, in multi-component
products that use communications services, which entity is responsible for failing to
provide access.640 Therefore, to facilitate settlements, as well as to assist consumers with
bringing their concerns to the companies against which they might have a complaint, we
adopt a compromise pre-filing requirement that is designed to reap the benefits of
informal dispute resolution efforts, but that does not impose an unreasonable burden on
consumers by requiring them to approach companies on their own.
234.
We will require consumers to file a "Request for Dispute Assistance"
("Request") with CGB, rather than with a covered entity, prior to filing an informal
complaint with the Commission.641 This requirement to file a Request is a prerequisite to
the filing of informal complaints only. It is not a prerequisite to the filing of a formal
complaint, as the complainant and the respondent to a formal complaint proceeding are
both required to certify in their pleadings that, prior to the filing of the formal complaint,
both parties, "in good faith, discussed or attempted to discuss the possibility of
settlement."642
235.
This Request should contain: (1) the name, address, e-mail address, and
telephone number of the consumer and the manufacturer or service provider against


638 AT&T Comments at 13-14 (should require a 30 day pre-filing notice); CEA Comments at 31-32 (should
require an unspecified pre-filing notice period); CTIA Comments at 31-32 (should require a 30 day pre-
filing notice period); TechAmerica Comments at 10 (arguing that "the Commission should encourage, if
not require, potential complainants" to notify potential respondents of an intent to file a complaint); Letter
from Mark Uncapher, Director, TIA, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 2
(filed Sept. 12, 2011) ("TIA Sept. 12 Ex Parte"); TIA Sept. 28 Ex Parte at 2 (arguing that consumers and
covered entities should have 60 days to resolve a dispute before an informal complaint is filed).
639 IT and Telecom RERCs Comments at 39-40 ("[A pre-filing requirement] can lead to frustration and
giving up on pursuing the complaint.").
640 See IT and Telecom RERCs Comments at 39-40.
641 A Request for Dispute Assistance may be sent to CGB in the same manner as an informal complaint, as
discussed below, but filers should use the e-mail address dro@fcc.gov if sending their complaint by e-mail.
Parties with questions regarding these requests should call CGB at 202-418-2517 (voice), 202-418-2922
(TTY), or visit the Commission's Disability Rights Office web site at http://transition.fcc.gov/cgb/dro.
CGB will establish a system for online filing of requests for dispute assistance. When this system is
available, CGB will release a public notice announcing this fact and providing instructions on its use. CGB
will also update the Disability Rights Office section of the Commission's website to describe how requests
for dispute assistance may be filed.
642 See Appendix B, 47 C.F.R. 14.39(a)(8), 14.42(h).
101

Federal Communications Commission

FCC 11-151

whom the complaint will be made;643 (2) an explanation of why the consumer believes the
manufacturer or provider is in violation of Sections 255, 716, or 718 of the Commission's
implementing rules, including details regarding the service or equipment and the relief
requested and any documentation that supports the complainant's contention; (3) the
approximate date or dates on which the consumer either purchased, acquired, or used (or
attempted to purchase, acquire, or use) the equipment or service in question; (4) the
consumer's preferred format or method of response to the complaint by the Commission
and defendant (e.g., letter, facsimile transmission, telephone (voice/TRS/TTY), e-mail, or
some other method that will best accommodate the consumer's disability); and (5) any
other information that may be helpful to CGB and the defendant to understand the nature
of the complaint.
236.
CGB will forward a copy of the request to the named manufacturer or
service provider in a timely manner. As discussed in the Recordkeeping Section above,
we require covered entities to include their contact information in their annual
certifications filed with the Commission.644 If a covered entity has not filed a
certification that includes its contact information,645 CGB shall forward the request to the
covered entity based on publicly available information, and the covered entity may not
argue that it did not have a sufficient opportunity to settle a potential complaint during
the dispute assistance process. If, in the course of the CGB dispute assistance process,
CGB or the parties learn that the Requester has identified the wrong entity or there is
more than one covered entity that should be included in the settlement process, then CGB
will assist the parties in ascertaining and locating the correct covered entity or entities for
the dispute at issue. In this case, the 30-day period will be extended for a reasonable time
period, so that the correct covered entities have notice and an opportunity to remedy any
failure to make a product or service achievable or to settle the dispute in another manner.
237.
Once the covered entity receives the Request, CGB will then assist the
consumer and the covered entity in reaching a settlement of the dispute with the covered
entity. After 30 days, if a settlement has not been reached, the consumer may then file an
informal complaint with the Commission. However, if the consumer wishes to continue
using CGB as a settlement resource beyond the 30-day period, the consumer and the
covered entity may mutually agree to extend the CGB dispute assistance process for an
additional 30 days and in 30-day increments thereafter.646 Once a consumer files an


643 Where the consumer does not have all of this information or cannot identify the appropriate
manufacturer or service provider, he or she should provide as much information as possible and work with
CGB to identify the appropriate covered entity and its contact information.
644 Recordkeeping, Section III.E.1, supra. See Appendix B, 47 C.F.R. 14.31(b).
645 Failure to file a certification is a violation of the Commission's rules. See Appendix B, 47 C.F.R.
14.31(b).
646 We find that this is a better approach than the strict 60-day period recommended by TIA (see TIA Sept.
12 Ex Parte and TIA Sept. 28 Ex Parte) because it will encourage more expeditious resolutions while
providing greater flexibility to the consumer and the covered entity to continue negotiations on an as
needed basis.
102

Federal Communications Commission

FCC 11-151

informal complaint with the Enforcement Bureau, as discussed below, the Commission
will deem the CGB dispute assistance process concluded.647
238.
In the course of assisting parties to resolve a Section 716 dispute, CGB
may discover that the named manufacturer or service provider is exempt from Section
716 obligations under a waiver or the temporary small business exemption.648 In such
cases, CGB will inform the consumer why the named covered entity has no responsibility
to make its service or product accessible, and the dispute assistance process will
terminate.
239.
We believe that this dispute assistance process provides an appropriate
amount of time to facilitate settlements and provide assistance to consumers to rapidly
and efficiently resolve accessibility issues with covered entities.649 We also believe that
this approach will lessen the hesitation of some consumers to approach companies about
their concerns or complaints by themselves. Commission involvement before a
complaint is filed will benefit both consumers and industry by helping to clarify the
accessibility needs of consumers for the manufacturers or service providers against which
they may be contemplating a complaint, encouraging settlement discussions between the
parties, and resolving accessibility issues without the expenditure of time and resources
in the informal complaint process.
240.
No parties opposed the Commission's proposal not to adopt a standing
requirement or its proposal to continue taking sua sponte enforcement actions. The
language of the statute supports no standing requirement, stating that "[a]ny person
alleging a violation . . . may file a formal or informal complaint with the Commission."650
We believe that any person should be able to identify noncompliance by covered entities
and anticipate that informal or formal complaints will be filed by a wide range of
complainants, including those with and without disabilities and by individuals and
consumer groups.651 Therefore, we find no reason to establish a standing requirement and


647 As discussed in Informal Complaints, Section III.E.2.c, infra, an informal complainant will be required
to certify that it filed a "Request for Dispute Assistance" and to provide the date on which such request for
filed.
648 See Exemptions for Small Entities Temporary Exemption of Section 716 Requirements, Section
III.C.3, supra.
649 TIA Aug. 26 Ex Parte at 2 (arguing that a pre-complaint, CGB-facilitated process will permit
consumers and covered entities to resolve disputes on their own); Letter from Julie M. Kearney, Vice
President, Regulatory Affairs, CEA, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 2-3
n.10 (filed Sept. 6, 2011) ("CEA Sept. 6 Ex Parte") (expressing general support for TIA's CGB proposal);
see Letter from Matthew Gerst, Counsel, CTIA, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-
213, Attachment at 12 (filed Aug. 11, 2011) ("CTIA Aug. 11 Ex Parte") (stating that "[e]arly resolution
among parties should be encouraged").
650 47 U.S.C. 618(a)(3)(A).
651 As noted in the Accessibility NPRM, there is no standing requirement under Sections 255, 716, and 718
or under Section 208 of the Act and our existing rules. See Accessibility NPRM, 26 FCC Rcd at 3182-83,
130. See also Section 255 Report and Order, 16 FCC Rcd at 6469, 125 (also noting that Section 208,
Section 255, and the complaint rules do not include a standing requirement); IT and Telecom RERCs
(continued....)
103

Federal Communications Commission

FCC 11-151

adopt the Accessibility NPRM's proposal on standing to file. We also find no reason to
modify existing procedures for initiating, on our own motion, Commission and staff
investigations, inquiries, and proceedings for violations of our rules and the Act.
Irrespective of whether a consumer has sought dispute assistance or filed a complaint on
a particular issue, we intend to continue using all our investigatory and enforcement tools
whenever necessary to ensure compliance with the Act and our rules.
c.

Informal Complaints

241.
Background. Section 717(a) of the Act requires, in part, that the
Commission adopt rules governing the filing of informal complaints that allege violations
of Section 255, 716, or 718, and to establish procedures for enforcement actions by the
Commission for any such violations, including for filing complaints and answers,
consolidation of substantially similar complaints, timelines for conducting investigations
and issuing findings, and remedies.652
242.
In the Accessibility NPRM, the Commission proposed a minimum set of
requirements for complainants to include in their informal complaints.653 The
Commission stated that the proposed requirements are consistent with its current Section
255 rules and with informal complaint provisions that the Commission has adopted in
other contexts.654
243.
Discussion. In crafting rules to govern informal accessibility complaints,
we have first examined the requirements of the CVAA, especially our obligation to
undertake an investigation to determine whether a manufacturer or service provider has
violated core accessibility requirements. While the investigation is pending, the CVAA
also encourages private settlement of informal complaints, which may terminate the
investigation.655 When a complaint is not resolved independently between the parties,
however, the Commission must issue an order to set forth and fully explain the
determination as to whether a violation has occurred.656 Further, if the Commission finds
that a violation has occurred, a defendant manufacturer or service provider may be
directed to institute broad remedial measures that have implications and effects far
beyond an individual complainant's particular situation, as in an order by the
(Continued from previous page)


Comments at 40 (agreeing that there is no basis in law for imposing a standing requirement); Words+ and
Compusult Comments at 35 (opposing any standing requirement).
652 47 U.S.C. 618(a)(1)-(4).
653 Accessibility NPRM, 26 FCC Rcd at 3183, 136.
654 47 C.F.R. 1.617 1.619 (informal complaints against common carriers); 47 C.F.R. 1.719 (informal
complaints regarding unauthorized changes in subscriber carrier selections); 47 C.F.R. 6.17 - 6.20, 7.17
- 7.20 (informal disabilities complaints under Section 255); 47 C.F.R. 68.417 68.420 (informal
complaints regarding hearing aid compatibility).
655 47 U.S.C. 618(a)(8) ("Nothing in the Commission's rules or this Act shall be construed to preclude a
person who files a complaint and a manufacturer or provider from resolving a formal or informal complaint
prior to the Commission's final determination in a complaint proceeding. In the event of such a resolution,
the parties shall jointly request dismissal of the complaint and the Commission shall grant such request.").
656 47 U.S.C. 618(a)(3)(B).
104

Federal Communications Commission

FCC 11-151

Commission to make accessible the service or the next generation of equipment.657
Finally, the CVAA requires that the Commission hold as confidential certain materials
generated by manufacturers and service providers who may be defendants in informal
complaint cases.658 In addition to these statutory imperatives, we have also carefully
considered the comments filed in this proceeding as well as our existing rules that apply
to a variety of informal complaints.
244.
Taking these factors into account, together with the complexity of issues
and highly technical nature of the potential disputes that we are likely to encounter in
resolving complaints, the rules we adopt here attempt to balance the interests of both
industry and consumers. In this regard, we seek, as much as possible, to minimize the
costs and burdens imposed on these parties while both encouraging the non-adversarial
resolution of disputes and ensuring that the Commission is able to obtain the information
necessary to resolve a complaint in a timely fashion. We discuss these priorities more
fully below and set forth both our pleading requirements and the factors that we believe
are crucial to our resolution of informal accessibility complaints.
245.
We find the public interest would be served by adopting the minimum
requirements identified by the Commission in the Accessibility NPRM for informal
complaints.659 Specifically, the rules we adopt today will require informal complaints to
contain, at a minimum: (1) the name, address, e-mail address, and telephone number of
the complainant, and the manufacturer or service provider defendant against whom the
complaint is made; (2) a complete statement of facts explaining why the complainant
contends that the defendant manufacturer or provider is in violation of Sections 255, 716,
or 718, including details regarding the service or equipment and the relief requested and
all documentation that supports the complainant's contention; (3) the date or dates on
which the complainant or person on whose behalf the complaint is being filed either
purchased, acquired, or used (or attempted to purchase, acquire, or use) the equipment or
service about which the complaint is being made; (4) a certification that the complainant
submitted to the Commission a Request for Dispute Assistance no less than 30 days
before the complaint is filed and the date that the Request was filed; (5) the
complainant's preferred format or method of response to the complaint by the
Commission and defendant (e.g., letter, facsimile transmission, telephone
(voice/TRS/TTY), e-mail, audio-cassette recording, Braille, or some other method that
will best accommodate the complainant's disability, if any); and (6) any other
information that is required by the Commission's accessibility complaint form.
246.
The minimum requirements we adopt today for informal complaints are
aligned with our existing informal complaint rules and the existing rules governing
Section 255 complaints and take into account our statutory obligations under the CVAA.
They will allow us to identify the parties to be served, the specific issues forming the


657 47 U.S.C. 618(a)(3)(B)(i).
658 47 U.S.C. 618(a)(5)(C).
659 We also include an additional certification requirement related to our new Dispute Assistance Program.
See General Requirements, Section III.E.2.b, supra.
105

Federal Communications Commission

FCC 11-151

subject matter of the complaint, and the statutory provisions of the alleged violation, as
well as to collect information to investigate the allegations and make a timely
accessibility achievability determination. Further, we believe that these requirements
create a simple mechanism for parties to bring legitimate accessibility complaints before
the Commission while deterring potential complainants from filing frivolous, incomplete,
or inaccurate complaints. Accordingly, we decline to relax or expand the threshold
requirements for informal accessibility complaints as advocated by some commenters.660
247.
As the Commission noted in the Accessibility NPRM, complaints that do
not satisfy the pleading requirements will be dismissed without prejudice to re-file.661 We
disagree with AFB that the Commission should work with a complainant to correct any
errors before dismissing a defective complaint.662 Under the statute and the rules we
adopt today, the complainant in an informal complaint process is a party to the
proceeding. The informal complaint proceeding is triggered by the filing of the informal
complaint.663 Once the proceeding is initiated, the Commission's role is one of impartial
adjudicator not of an advocate for either the complainant or the manufacturer or service
provider that is the subject of the complaint. While we will dismiss defective complaints
once filed, we agree with commenters that consumers may need some assistance before
filing their complaints.664 Toward that end, consumers may contact the Commission's
Disability Rights Office by sending an e-mail to dro@fcc.gov; calling 202-418-2517
(voice) or 202-418-2922 (TTY), or visiting its website at http://transition.fcc.gov/cgb/dro
with any questions regarding where to find contact information for manufacturers and
service providers, how to file an informal complaint, and what the complaint should
contain.
248.
By making the Commission's Disability Rights Office available to
consumers with questions, and by carefully crafting the dispute assistance process,665 we
believe that we have minimized any potential minimal burdens that an informal


660 See, e.g., CTIA Comments at 34; IT and Telecom RERCs Comments at 41.
661 Accessibility NPRM, 26 FCC Rcd at 3183, 136. See CEA Sept. 6 Ex Parte at 3 (arguing that
Commission staff should have discretion to dismiss complaints that are deficient on their face).
662 See AFB Reply Comments at 14. In fact, we hope that a majority of consumer issues can be resolved
through the dispute assistance process and thereby alleviate the need for consumers to file a complaint at
all. See General Requirements, Section III.E.2.b, supra.
663 See 47 U.S.C. 618(a)(3)(B).
664 One commenter suggests that it may be difficult for consumers to obtain addresses for potential
defendants as required by our rules. AFB Reply Comments at 14 (complainants should be required to
provide only the name of the manufacturer and/or service provider and, "if possible," its city and state or
country for foreign entities). All manufacturers and service providers subject to Sections 255, 716, and 718
are required to file with the Commission, and regularly update their business address and other contact
information. Consumers, therefore, should have a simple means of obtaining this required information.
Finally, the Commission may modify content requirements when necessary to accommodate a complainant
whose disability may prevent him from providing information required under our rules. Section 255 Report
and Order,
16 FCC Rcd at 6468-69, 123.
665 See General Requirements, Section III.E.2.b, supra.
106

Federal Communications Commission

FCC 11-151

complaint's content requirements may impose on consumers.666 After a consumer has
undertaken the dispute assistance process, CGB and the parties should have identified the
correct manufacturer or service provider that the consumer will name in the informal
complaint.667 Indeed, by the conclusion of the dispute assistance process, a consumer
should have obtained all the information necessary to satisfy the minimal requirements of
an informal complaint.
249.
We decline to adopt a requirement suggested by some commenters that
consumers be either encouraged or compelled to disclose the nature of their disability in
an informal complaint.668 Nothing in the statute or the rules we adopt today limits the
filing of informal complaints to persons with disabilities or would prevent an advocacy
organization, a person without disabilities, or other legal entity from filing a complaint.669
Thus, not every informal accessibility complaint will necessarily be filed by an individual
with a disability. Further, imposing or even suggesting such a disclosure could have
privacy implications and discourage some persons from filing otherwise legitimate
complaints. To the extent that a particular disability is relevant to the alleged
inaccessibility of a product or service, the complainant is free to choose whether to
disclose his or her disability in the statement of facts explaining why the complainant
believes the manufacturer or service provider is in violation of Section 255, 716, or
718.670
250.
We also decline to permit consumers to assert anonymity when filing
informal accessibility complaints. One commenter suggests that such a procedure should
be made available to complainants who may be concerned about retaliation.671
Anonymity would preclude the complainant from playing an active role in the
adjudicatory process and prevent informal contacts and negotiated settlement between


666 Some commenters argue generally that the Accessibility NPRM's proposed complaint content
requirements impose a burden on consumers. See, e.g., IT and Telecom RERC Comments at 41; AFB
Reply Comments at 13-14.
667 Some commenters argue that the consumer may not be able to identify which covered entity is
responsible for ensuring accessibility. See Words+ and Compusult Comments at 36 ("Often the consumer
does not make the distinct[ion] between the specific phone and the service provided by the service
provider. In fact, many phones are branded by the service provider such that only the most knowledgeable
consumer would know who the manufacturer of their device is."); AFB Reply Comments at 13-14
(consumers frequently are unaware of the manufacturer of the products they use for communications).
668 T-Mobile Comments at 15 (Commission should require complainants "to describe with specificity the
disability that prompts the complaint and the relief requested"); Words+ and Compusult Comments at 36
(suggesting that such disclosure, although potentially beneficial, should be optional); CEA Reply
Comments at 21.
669 See e.g. General Requirements, Section III.E.2.b, supra (declining to attach any standing requirement to
informal or formal accessibility complaints).
670 In this regard, we agree that it is sufficient for a complainant to describe the alleged inaccessibility in
simple and functional terms such as "I can hear my phone's e-mail menu choices, but my phone won't read
my e-mail aloud to me no matter what I do." AFB Reply Comments at 14.
671 IT and Telecom RERCs Comments at 41.
107

Federal Communications Commission

FCC 11-151

parties to resolve an informal complaint filed with the Commission a possibility clearly
favored by the CVAA.672 We recognize, however, that some consumers who wish to
remain anonymous may have valuable information that could prompt the Commission to
investigate, on its own motion, a particular entity's compliance with Section 255, 716, or
718. We wish to encourage those consumers who do not want to file a complaint with
the Commission, for fear of retaliation or other reasons, to provide the Commission with
information about non-compliance with Section 255, 716, or 718. To do so, consumers
may anonymously apprise the Commission of possible unlawful conduct by
manufacturers or service providers with respect to accessibility and compliance with
Section 255, 716, or 718.673 This may trigger an investigation by the Commission on its
own initiative, but supplying such information is not tantamount to filing an informal
complaint subject to the procedures we adopt today.
251.
We also decline to establish deadlines for filing an informal accessibility
complaint as requested by one party. Specifically, CTIA contends that complaints should
be limited to a specified filing window that is tied to either the initial purchase of the
equipment or service or the first instance of perceived inaccessibility.674 As a preliminary
matter, the statute does not impose a "filing window" or "statute of limitations" on the
filing of complaints, and we see no reason to adopt such a limit today. Further, we have
no information beyond conjecture to suggest that consumers would be likely to use the
informal complaint process to bring stale accessibility issues before the Commission.675
The timeliness with which a complaint is brought may, however, have a bearing on its
outcome. Complaints that are brought against products or services that are no longer
being offered to the public, for example, may be less likely to bring about results that
would be beneficial to complainants.
252.
Finally, we do not believe that it is necessary to apply more stringent
content requirements to informal complaints. We find unpersuasive the contention that
complainants should be required to provide some evidentiary showing of a violation
beyond the narrative required by new section 14.34(b) of our new rules.676 In fact, the


672 See 47 U.S.C. 618(a)(8) (addressing private resolutions of informal complaints and providing that the
Commission "shall grant" joint requests for dismissal). Some commenters point to the benefits that accrue
to complainants, defendants, and the Commission when accessibility complaints are resolved informally
between the parties; AT&T Comments at 13-16; CTIA Comments at 31.
673 The Commission will issue a public notice that will provide a Commission e-mail address and voice and
TTY number for the receipt of information from members of the public relating to possible Section 255,
716, or 718 statutory and rule violations. Consumers may provide such information anonymously. The
Commission may use this information to launch its own investigation on its own motion. This process
should satisfy the IT and Telecom RERCs' concern that some consumer may wish to provide information
but remain anonymous. IT and Telecom RERCs Comments at 41.
674 CTIA Comments at 35.
675 The Commission examined this issue previously in connection with the Section 255 complaint rules and
found that in bringing informal complaints against common carriers, consumers seldom complained about
conduct occurring more that a year prior to the filing of a complaint. Section 255 Report and Order, 16
FCC Rcd at 6479, 153.
676 CTIA Comments at 34, 37.
108

Federal Communications Commission

FCC 11-151

primary evidence necessary to assess whether a violation has occurred resides with
manufacturers and service providers, not with consumers who use their products and
services. While a consumer should be prepared to fully explain the manner in which a
product or service is inaccessible, inaccessibility alone does not establish a violation.
Specifically, a violation exists only if the covered product or service is inaccessible and
accessibility was, in fact, achievable. To require that a complaint include evidentiary
documentation or analysis demonstrating a violation has occurred would place the
complainant in the untenable position of being expected to conduct a complex
achievability analysis without the benefit of the data necessary for such an analysis
simply in order to initiate the informal complaint process.677 It is the covered entity that
will have the information necessary to conduct such an analysis, not the complainant.
253.
While no parties specifically commented on how the Commission should
establish separate and identifiable electronic, telephonic, and physical receptacles for the
receipt of informal complaints, the Commission has established a process that allows
consumers flexibility in the manner in which they choose to file an informal complaint.678
Informal complaints alleging a violation of Section 255, 716, or 718 may be transmitted
to the Commission via any reasonable means, including by the Commission's online
informal complaint filing system, U.S. Mail, overnight delivery, or e-mail.679 We
encourage parties to use the Commission's online filing system, because of its ease of
use. Informal complaints filed using a method other than the Commission's online
system680 should include a cover letter that references Section 255, 716, or 718 and
should be addressed to the Enforcement Bureau. Any party with a question about
information that should be included in a complaint alleging a violation of Section 255,


677 See IT and Telecom RERCs Comments at 41 ("[Consumers] simply want an accessible product or
service. . . . The Commission is in a far better position to investigate the details of the manufacture and
distribution, accessibility and achievability of any given product or service than is the consumer."); AFB
Reply Comments at 14 (some consumers may consider themselves unable to fully explain the technical
reasons for inaccessibility).
678 CGB will establish a system for online filing of informal complaints. When this system is available,
CGB will release a public notice announcing this fact and providing instructions on its use. CGB will also
update the Disability Rights Office section of the Commission's website to describe how requests for
dispute assistance may be filed. Formal complaints must be filed in accordance with Sections 14.38-14.52
of our new rules. See Appendix B attached, adopting new section 14.52, 47 C.F.R. 14.52 ("Copies;
service; separate filings against multiple defendants"); Formal Complaints, Section III.E.2.d, infra
(adopting, with a few modifications, Commission's general Formal Complaint rules for accessibility
complaints).
679 The Commission will issue a public notice announcing the establishment of an Enforcement Bureau e-
mail address that will accept informal complaints alleging violations of Section 255, 716 or 718 or the
Commission's rules.
680 The Commission will issue a public notice as soon as its online system is established for filing informal
complaints alleging violations of the rules adopted in this Report and Order.
109

Federal Communications Commission

FCC 11-151

716, or 718 should contact the Commission's Disability Rights Office via e-mail at
dro@fcc.gov or by calling 202-418-2517 (voice), 202-418-2922 (TTY).681
254.
Once we receive a complaint, we will forward those complaints meeting
the filing requirements, discussed above, to the manufacturer or service provider named
in the complaint.682 To facilitate service of the complaints on the manufacturer or service
provider named in the complaint, we adopt the Commission's proposal to require such
entities to disclose points of contact for complaints and inquiries under Section 255, 716,
or 718 in annual certifications. As discussed in greater detail in General Requirements,
Section III.E.2.b, supra,, failure to file a certification is a violation of our rules. We
expect that the parties or the Commission will discover that a covered entity has not filed
contact information during the dispute assistance process, that the violation will be
remedied during that process, and that the complainant will have the contact information
prior to filing a complaint.
255.
We believe that requiring such points of contact will facilitate consumers'
ability to communicate directly with manufacturers and service providers about
accessibility issues or concerns and ensure prompt and effective service of complaints on
defendant manufacturers and service providers by the Commission.683 The contact
information must, at a minimum, include the name of the person or office whose
principal function will be to ensure the manufacturer or service provider's prompt receipt
and handling of accessibility concerns, telephone number (voice and TTY), fax number,
and both mailing and e-mail addresses. Covered entities must file their contact
information with the Commission in accordance with our rules governing the filing of
annual certifications.684 We intend to make this information available on the
Commission's website and also encourage, but do not require, covered entities to clearly
and prominently identify the designated points of contact for accessibility matters in,
among other places, their company websites, directories, manuals, brochures, and other
promotional materials. Providing such information on a company's website may assist
consumers in contacting the companies directly and allow them to resolve their
accessibility issues, eliminating any need to seek Commission assistance or file a
complaint. Because the contact information is a crucial component of the informal
complaint process (i.e., service of the complaint on defendants which, in turn, provides


681 See AFB Reply Comments at 14-15 ("We believe that the final rule should establish a complaint
navigation ombudsman function within the Commission to which consumers can turn for advice on proper
form and effective content of both formal and informal complaints.").
682 In some cases the complaint may allege a violation involving both a manufacturer and a service
provider and/or multiple manufacturers and service providers. For clarity, we will refer to manufacturers
and service providers in the singular and use of the word "or" in the text means "and/or" as applicable to a
given complaint.
683 See CTIA Comments at 33; Verizon Comments at 14-15; Words+ and Compusult Comments at 37.
684 Appendix B, 14.31(b). See Recordkeeping, Section III.E.1, supra. CGB will establish a system for
online filing of contact information. When this system is available, CGB will release a public notice
announcing this fact and providing instructions on its use. CGB will also update the Disability Rights
Office section of the Commission's website to describe how contact information may be filed.
110

Federal Communications Commission

FCC 11-151

defendants with notice and opportunity to respond),685 we require that the contact
information be kept current.686
256.
The CVAA provides that the party that is the subject of the complaint be
given a reasonable opportunity to respond to the allegations in the complaint before the
Commission makes its determination regarding whether a violation occurred. It also
allows the party to include in its answer any relevant information (e.g., factors
demonstrating that the equipment or advanced communications services, as applicable,
are accessible to and usable by individuals with disabilities or that accessibility is not
achievable under the standards set out in the CVAA and rules adopted today).687 These
provisions not only protect the due process rights of defendant manufacturers and service
providers in informal complaint cases but also enable the Commission to compile a
complete record to resolve a complaint and conduct the required investigation as to
whether a violation of Section 255, 716, or 718 has occurred.
257.
To implement these provisions of the CVAA, we adopt the Commission's
proposal in the Accessibility NPRM with one modification688 and require answers to
informal complaints to: (1) be filed with the Commission and served on the complainant
within twenty days of service of the complaint, unless the Commission or its staff
specifies another time period; (2) respond specifically to each material allegation in the
complaint; (3) set forth the steps taken by the manufacturer or service provider to make
the product or service accessible and usable; (4) set forth the procedures and processes
used by the manufacturer or service provider to evaluate whether it was achievable to
make the product or service accessible and usable; (5) set forth the manufacturer's or
service provider's basis for determining that it was not achievable to make the product or
service accessible and usable; (6) provide all documents supporting the manufacturer's or
service provider's conclusion that it was not achievable to make the product or service
accessible and usable;689 (7) include a declaration by an officer of the manufacturer or


685 It is critical that the Commission have correct information for service. If the complaint is not served to
the correct address, it could delay or prevent the applicable manufacturer or service provider from timely
responding. Failure to timely respond to a complaint or order of the Commission could subject a party to
sanction or other penalties. See 47 U.S.C. 503(b).
686 In this regard, whenever the information is no longer correct in any material respect, manufacturers and
service providers shall file and update the information within 30 days of any change to the information on
file with the Commission. Further, failure to file contact information or to keep such information current
will be a violation of our rules warranting an upward adjustment of the applicable base forfeiture under
section 1.80 of our rules for "[e]gregious misconduct" and "[s]ubstantial harm." 47 C.F.R. 1.80(4)
Section I (Base Amount for Section 503 Forfeitures) and Section II (Adjustment Criteria for Section 503
Forfeitures). Likewise, the violation will be a "continuous violation" until cured. 47 C.F.R. 1.80(4)
Section II.
687 47 U.S.C. 618(a)(4).
688 We are not requiring defendants to provide the names, titles, and responsibilities of each decision
maker in the evaluation process as we initially proposed in the Accessibility NPRM. We are, however,
preserving our right to request such information on a case-by-case basis.
689 We anticipate that much of this documentation will be kept confidential in accordance with our
recordkeeping rules adopted today. Appendix B, 14.31(c).
111

Federal Communications Commission

FCC 11-151

service provider attesting to the truth of the facts asserted in the answer; (8) set forth any
claimed defenses; (9) set forth any remedial actions already taken or proposed alternative
relief without any prejudice to any denials or defenses raised; (10) provide any other
information or materials specified by the Commission as relevant to its consideration of
the complaint; and (11) be prepared or formatted in the manner requested by the
Commission and the complainant, unless otherwise permitted by the Commission for
good cause shown.690 We also adopt the Commission's proposal to allow the
complainant ten days, unless otherwise directed by the Commission, to file and serve a
reply that is responsive to the matters contained in the answer without the addition of new
matters.691 We do not anticipate accepting additional filings.
258.
Defendants must file complete answers, including supporting records and
documentation, with the Commission within the 20-day time period specified by the
Commission. While we agree with those commenters that argue that a narrative answer
or product design summary would be useful,692 we disagree that such a response, by
itself, is sufficient to allow the Commission to fully investigate and make an accessibility
or achievability determination as required by the Act. An answer must comply with all of
the requirements listed in the paragraph above and include, where necessary, a discussion
of how supporting documents, including confidential documents, support defenses
asserted in the answer. We note that, because the CVAA requires that we keep certain of
a defendant's documents confidential,693 we will not require a defendant to serve the
complainant a confidential answer that incorporates, and argues the relevance of,
confidential documents. Instead, we will require a defendant to file a non-confidential
summary of its answer with the Commission and serve a copy on the complainant. The
non-confidential summary must contain the essential elements of the answer, including
any asserted defenses to the complaint, whether the defendant concedes that the product
or service at issue was not accessible, and if so, the basis for its determination that
accessibility was not achievable, and other material elements of its answer. The non-
confidential summary should provide sufficient information to allow the complainant to
file a reply, if he or she so chooses.694 The Commission may also use the summary to
give context to help guide its review of the detailed records filed by the defendant in its
answer.


690 Accessibility NPRM, 26 FCC Rcd at 3184, 138.
691 One party, while supporting adoption of this provision, urged the Commission to grant extensions of
time liberally for replies. Words+ and Compusult Comments at 37-38. While we will carefully consider
requests for extensions of time, we emphasize again that extensions of time will not be routinely granted,
particularly because of the strict deadline for the Commission's determination.
692 CEA Comments at 46 (narrative response and product design summary will likely better detail
accessibility efforts); Verizon Comments at 15-16 (a narrative response from defendants detailing
accessibility efforts would often be more appropriate).
693 See 47 U.S.C 618(a)(5)(C).
694 Complainants may also request a copy of the public redacted version of a defendant's answer, as well
as seek to obtain records filed by the defendant through a FOIA filing.
112

Federal Communications Commission

FCC 11-151

259.
We are also adopting the Commission's proposal in the Accessibility
NPRM to require that defendants include in their answers a declaration by an authorized
officer of the manufacturer or service provider of the truth and accuracy of the defense.
Such a declaration is not "irrelevant" to whether a manufacturer or service provider has
properly concluded that accessibility was not achievable,695 as it establishes the good faith
of the analysis and holds the company accountable for a conclusion that ultimately
resulted in an inaccessible product or service. Consistent with requirements for
declarations in other contexts, we specify that a declaration here must be made under
penalty of perjury, signed and dated by the certifying officer.696
260.
We are not requiring answers to include the names, titles, and
responsibilities of each decisionmaker involved in the process by which a manufacturer
or service provider determined that accessibility of a particular offering was not
achievable. We agree that such a requirement may be unduly burdensome, given the
complexity of the product and service development process.697 We will, however, reserve
our right under the Act to request such information on a case-by-case basis if we
determine during the course of an investigation initiated in response to a complaint or our
own motion that such information may help uncover facts to support our determination
and finding of compliance or non-compliance with the Act.
261.
We decline to adopt CTIA's proposal to incorporate the CVAA's
limitation on liability, safe harbor, prospective guidelines, and rule of construction
provisions into our rules as affirmative defenses.698 CTIA proposes that we adopt a
bifurcated approach to our informal complaint process in which the Commission would
determine whether certain affirmative defenses699 were applicable before requiring the
defendant to respond to the complaint in full. We believe that the approach we adopt
today is more likely to maximize the efficient resolution of informal complaints than the
approach that CTIA recommends. Our rules will afford a defendant ample opportunity to
assert all defenses that the defendant deems germane to its case and assures that the
Commission has a complete record to render its decision based on that record within the
statutory 180-day timeframe. Because the Commission will be considering all applicable
defenses as part of this process, we believe that singling out certain defenses to
incorporate into our rules is unwarranted.
262.
We also disagree with those commenters that express concern that the
Accessibility NPRM did not appear to contemplate that some defendants may claim that
their products or services are, in fact, accessible under Section 255, 716, or 718.700 As


695 CEA Comments at 46.
696 47 C.F.R. 64.2009(e).
697 TIA Comments at 28. See also CEA Comments at 46; CTIA Comments at 37-8..
698 See Letter from Matthew Gerst, Counsel, External & State Affairs, CTIA, to Marlene H. Dortch,
Secretary, FCC, CG Docket No 10-213, (filed Sept. 26, 2011) ("CTIA Sept. 26 Ex Parte").
699 See CTIA Sept. 26 Ex Parte.
700 CEA Comments at 45 (answer requirements "implicitly assume" that the product is not accessible); T-
Mobile Comments at 15.
113

Federal Communications Commission

FCC 11-151

noted above, the rules we adopt today afford defendants ample opportunity to assert such
a claim as an affirmative defense to a charge of non-compliance with our rules and to
provide supporting documentation and evidence demonstrating that a particular product
or service is accessible and usable either with or without third party applications,
peripheral devices, software, hardware, or customer premises equipment.701 We
recognize that different information and documentation will be required in an answer
depending on the defense or defenses that are asserted. We expect defendants will file all
necessary documents and information called for to respond to the complaint and any
questions asked by the Commission when serving the complaint or in a letter of inquiry
during the course of the investigation. Again, covered entities have the burden of proving
that they have satisfied their legal obligations that a product or service is accessible and
useable, or if it is not, that it was not achievable.
263.
We also disagree with those commenters that contend that the answer
requirements, particularly those related to achievability, are "broad and onerous and may
subject covered entities to undue burdens."702
264.
According to these parties, defendants will be compelled to produce,
within an unreasonably short time frame, voluminous documents that may be of marginal
value to complainants or the Commission in making determinations regarding
accessibility and achievability of a particular product or service or in ensuring that an
individual complainant obtains an accessible service or device as promptly as possible.703
We address these concerns below.
265.
We disagree with commenters that the 20-day filing deadline for answers
is too short and that we should liberally grant extensions of time within which to file.704
We believe that the 20-day filing window is reasonable given the 180-day mandatory


701 Appendix B, 14.36.
702 CEA Comments at 44; CEA Sept. 6, 2011 Ex Parte at 3 (expressing concerns regarding sweeping
discovery and a wasteful litigation process); TIA Aug. 25, 2011 Ex Parte at 3 (arguing that the informal
complaint process should avoid "burdensome discovery"). As discussed in more detail in Section III.E.2.d
below regarding formal complaints, and as a cursory review of our enforcement rules, sections 14.33
14.52, shows, the informal complaint process is vastly streamlined compared to the formal complaint
process; thus, we disagree with CTIA that our informal complaint process imposes the "burdens of the
formal complaint process." See CTIA Aug. 11 Ex Parte, Attachment at 12.
703 AT&T Comments at 14-15; CEA Comments at 44; ITI Comments at 29; T-Mobile Comments at 15;
Verizon Comments at 15-16. Additionally, some parties contend that the answer requirements are
especially unwarranted given what they characterize as minimal standards for the complaint itself. See,
e.g.,
CTIA Comments at 36 ("The list is objectively burdensome especially in light of the lack of
requirement for an evidentiary basis in the complaint and pre-filing notice that provides an opportunity for
resolution."); ITI Comments at 29 (the Commission should require a prima facie showing in an informal
complaint before requiring a respondent to produce documents.)
704 AT&T Comments at 17; CEA Comments at 45; CTIA Comments at 40; TIA Comments at 26-27; T-
Mobile Comments at 15; Verizon Comments at 14-15.
114

Federal Communications Commission

FCC 11-151

schedule for resolving informal complaints.705 Furthermore, the dispute assistance
process, described in General Requirements, Section III.E.2.b, supra, requires that
consumers and manufacturers or service providers explore the possibilities for non-
adversarial resolution of accessibility disputes before a consumer may file a complaint.706
Defendants will, therefore, have ample notice as to the issues in dispute even before an
informal complaint is filed. In addition, all parties subject to Sections 255, 716, and 718
should already have created documents for their defense due to our recordkeeping rules.
As discussed above, this Report and Order places manufacturers and service providers on
notice that they bear the burden of showing that they are in compliance with Sections
255, 716, and 718 and our implementing rules by demonstrating that their products and
services are accessible as required by the statutes and our rules or that they satisfy the
defense that accessibility was not readily achievable under Section 255 or achievable
under the four factors specified in Section 716.707 They should, therefore, routinely
maintain any materials that they deem necessary to support their accessibility
achievability conclusions and have them available to rebut a claim of non-compliance in
an informal complaint or pursuant to an inquiry initiated by the Commission on its own
motion.
266.
Further, we do not believe additional time to file an answer or provide
responsive material is warranted for all complaints based on the possibility that the
documentation supporting a covered entity's claim may have been created in a language
other than English.708 Our recordkeeping rules will require English translations of any
records that are subject to our recordkeeping requirements to be produced in response to
an informal complaint or a Commission inquiry. Parties may seek extensions of time to
supplement their answers with translations of documents not subject to the mandatory
recordkeeping requirements. We caution, however, that such requests will not be
automatically granted, but will require a showing of good cause.
267.
Only a covered entity will have control over documents that are necessary
for us to comply with the Act's directive that we (1) "investigate the allegations in an
informal complaint" and (2) "issue an order concluding the investigation" that "shall
include a determination whether any violation [of Sections 255, 716, or 718 has]
occurred."709 We reject commenters' concerns that the documentation requirements focus


705 We generally allowed 30 days to answer a Section 255 informal complaint in proceedings that carried
no requirement for resolution by the Commission within a specified time frame and did not have
compulsory recordkeeping requirements. Section 255 Report and Order, 16 FCC Rcd at 6471-72, 133.
706 See General Requirements, Section III.E.2.b, supra.
707 See, e.g., Section 255 Report and Order, 16 FCC Rcd at 6444, 62 (citing Southeastern Community
College v. Davis
, 442 U.S. 397 (1979) and Alexander v. Choate, 469 U.S. 287 (1985) to support assigning
the burden of proof to the party claiming a defense regarding achievability).
708 But see CEA Comments at 45 (defendants may need additional time to translate non-English materials);
TIA Comments at 28-29 (fact that many companies do not keep documents in English creates burdens).
709 47 U.S.C. 618(a)(3)(B). We disagree with CEA that this statute grants us authority to sua sponte close
a complaint proceeding without issuing a final determination whether a violation occurs. Letter from Julie
M. Kearney, Vice President, CEA, to Marlene H. Dortch, Secretary, FCC, CG Docket No. 10-213, at 2-3
(continued....)
115

Federal Communications Commission

FCC 11-151

too strongly on broad compliance investigations rather than on ensuring that an individual
complainant is simply able to obtain an accessible product or service.710 Section
717(a)(1)(B)(i) specifically empowers us to go beyond the situation of the individual
complainant and order that a service, or the next generation of equipment, be made
accessible.711 Thus, our investigations with respect to informal complaints are directed to
violations of the Act and our rules not narrowly constrained to an individual
complainant obtaining an accessible product or service, as commenters suggest. The
dispute assistance process, on the other hand, is designed to assist consumers,
manufacturers, or service providers in solving individual issues before a complaint is
filed. Covered entities will have ample opportunity, therefore, to address the accessibility
needs of potential complainants.
268.
Finally, we reject the suggestion that if a defendant chooses to provide a
possible replacement product to the complainant, the Commission should automatically
stay the answer period while the complainant evaluates the new product.712 First, we
expect that in virtually all cases, any replacement products will have been provided and
evaluated during the pre-complaint dispute assistance process. Moreover, while
suspending pleading deadlines may relieve the parties from preparing answers or replies
that would be unnecessary if the manufacturer or service provider is able to satisfy the
complainant's accessibility concerns, it would also substantially delay compilation of a
complete record and thereby impede our ability to resolve the complaint within the
mandatory 180-day timeframe, should private settlement efforts fail. Accordingly, we
decline to adopt any procedure by which pleading deadlines would be automatically or
otherwise stayed. We emphasize, nonetheless, that the parties are free to jointly request
dismissal of a complaint without prejudice for the purpose of pursuing an informal
resolution of an accessibility complaint. In such cases, if informal efforts were
unsuccessful in providing the complainant with an accessible product or service, the
complainant could refile the informal complaint at any time and would not be required to
use the dispute assistance process again for that particular complaint.
d.

Formal Complaints

269.
Background. Section 717 states that aggrieved parties may use our more
formal adjudicative procedures to pursue accessibility claims against manufacturers or
(Continued from previous page)


(filed on July 20, 2011) (arguing that the Commission may determine that a complaint has been resolved
based on the defendant's response). However, where the complaint on its face shows that the subject
matter of the complaint has been resolved, we may dismiss the complaint as defective for failure to satisfy
the pleading requirements as discussed above. In addition, where the allegations in an informal complaint
allege a violation related to a particular piece of equipment or service that was the subject of a prior order
in an informal or formal complaint proceeding, then the Commission may issue an order determining that
the allegations of the instant complaint have already been resolved based on the findings and conclusions of
the prior order and such other documents and information that bear on the issues presented in the
complaint.
710 T-Mobile Comments at 15; CEA Reply Comments at 20.
711 47 U.S.C. 618(a)(1)(B)(i).
712 CEA Comments at 48.
116

Federal Communications Commission

FCC 11-151

service providers for violations of Sections 255, 716, and 718.713 Section 717 further
directs the Commission to establish regulations that facilitate the filing of such formal
claims.714 In the Accessibility NPRM, the Commission proposed rules for filing and
resolving formal complaints alleging a violation of Section 255, 716, or 718 of the Act
and the Commission rules implementing those sections.715 In particular, the Commission
proposed to require aggrieved parties to follow the Commission's existing formal
complaint procedures, as modified in the proposed rules.716
270.
Discussion. We adopt the rules the Commission proposed in the
Accessibility NPRM. Specifically, we require both complainants and defendants to: (1)
certify in their respective complaints and answers that they attempted in good faith to
settle the dispute before the complaint was filed with the Commission; and (2) submit
detailed factual and legal support, accompanied by affidavits and documentation, for their
respective positions in the initial complaint and answer. The rules also place strict limits
on the availability of discovery and subsequent pleading opportunities to present and
defend against claims of misconduct.717
271.
We decline to adopt a rule requiring an informal complaint to be filed
prior to the filing of a formal complaint.718 As with the informal complaint process, we
do not want to place any unnecessary barriers in the way of those who choose to use the
formal complaint process. In this regard, we agree with commenters that to require a
party to file an informal complaint as a prerequisite for filing a formal complaint would
create an unnecessary obstacle to complainants.719 Such a prerequisite is not required in
any other Commission complaint process and is inconsistent with the CVAA.720 For
these reasons, we decline to require that an informal complaint be filed prior to the filing
of a formal complaint.


713 47 U.S.C. 618(a)(3)(A).
714 47 U.S.C. 618(a).
715 Accessibility NPRM, 26 FCC Rcd at 3200, Appendix B (setting forth proposed new rules 47 C.F.R.
14.30-14.52 8.37 entitled "Subpart D Recordkeeping, Consumer Dispute Assistance, and
Enforcement"). These proposed rules were based in part on Commission formal complaint rules governing
other subject matters. See 47 C.F.R. 1.720 1.736.
716 Accessibility NPRM, 26 FCC Rcd at 3187, 141.
717 See Appendix B, 14.38-14.52.
718 ITI Comments at 31 (arguing that the filing of an informal complaint should be a prerequisite to filing a
formal complaint).
719 See IT and Telecom RERCs Comments at 42 (such a requirement would "further inhibit the formal
complaint process").
720 See 47 U.S.C. 618(a)(3)(A) ("Any person alleging a violation of section 255, . . . [716, or 718] by a
manufacturer or provider of service subject to such sections may file a formal or informal complaint with
the Commission.").
117

Federal Communications Commission

FCC 11-151

272.
We disagree with commenters that argue that the formal complaint rules
will impose a burden on consumers.721 Our rules follow the CVAA in providing
complainants with two options for filing complaints alleging accessibility violations. We
believe the formal complaint process we adopt today is no more burdensome than
necessary given the complexities inherent in litigation generally and is in line with our
other formal complaint processes. Like the Commission's other formal complaint
processes, the accessibility formal complaint rules allow parties an opportunity to
establish their case through the filing of briefs, answers, replies, and supporting
documentation; and allow access to useful information through discovery.
273.
If a complainant feels that the formal complaint process is too burdensome
or complex, the rules we adopt today provide the option to file an informal complaint that
is less complex, less costly, and is intended to be pursued without representation by
counsel.722 While complainants may see advantages and disadvantages with either of the
processes depending on the specifics of their circumstances, both options provide viable
means for seeking redress for what a complainant believes is a violation of our rules.
Moreover, we believe that potential complainants are in the best position to determine
which complaint process and associated remedies (formal or informal) serve their
particular needs.
274.
We adopt the Commission's proposal in the Accessibility NPRM to no
longer place formal accessibility complaints on the Accelerated Docket.723 Twelve years
before the CVAA was enacted, in the Section 255 Report and Order, the Commission
found that the Accelerated Docket rules were appropriate for handling expedited
consideration of consumer Section 255 formal complaints.724 In the CVAA, Congress
mandated expedited consideration of informal complaints by requiring a Commission
Order within 180 days after the date on which a complaint is filed.725 As discussed in
Informal Complaints, Section III.E.2.c, supra,726 we have carefully designed an informal
complaint process that will place a minimal burden on complainants, enable both parties
to present their cases fully, and require a Commission order within 180 days. We believe
that this consumer-friendly, informal complaint process addresses our concerns that
consumer complaints be resolved in a timely manner and provides an adequate substitute
for formal Accelerated Docket complaints. In addition, given the "accelerated" or 180-


721 Words+ and Compusult Comments at 34 (filing a formal complaint and conducting discovery are cost
prohibitive and require hiring legal counsel).
722 For example, there is no filing fee associated with filing an informal complaint and the filing can be
done by the average consumer. In contrast, there is a filing fee associated with the formal complaint
process and, in general, parties are represented by counsel.
723 See Accessibility NPRM, 26 FCC Rcd at 3186, 141 n.411; 47 C.F.R. 1.730 (permitting a complainant
to seek authorization from the Enforcement Bureau for placement on the bureau's accelerated docket under
certain narrow circumstances).
724 Section 255 Report and Order, 16 FCC Rcd at 6475-76, 143-146.
725 47 U.S.C. 618(a)(3)(B).
726See Informal Complaints, Section III.E.2.c, supra.
118

Federal Communications Commission

FCC 11-151

day resolution time-frame for informal complaints, we believe that retaining an
"Accelerated Docket" for formal complaints is no longer necessary and, in fact, may
impose an unnecessary restriction on the formal complaint process where, as discussed
above, the process involves, among other things, filing of briefs, responses, replies, and
discovery. Therefore we decline to adopt the Accelerated Docket rules for Sections 255,
716, and 718 formal complaints.
e.

Remedies and Sanctions

275.
Background. In the Accessibility NPRM, the Commission also invited
comment on what remedies and other sanctions should apply for violations of Section
255, 716, or 718.727 If the Commission finds a violation of Section 255, 716, or 718,
Section 717(a)(3)(B) authorizes us to direct a manufacturer to bring the next generation
of its equipment or device, and a service provider to bring its service, into compliance
within a "reasonable time."728 Further, Section 718(c) contemplates that we continue to
use our Section 503 remedies, as modified by the CVAA, to allow assessment of
forfeitures of up to $100,000 per violation for each day of a continuing violation, with the
maximum amount for a continuing violation set at $1 million, for violations of the Act.729
276.
Discussion. We intend to adjudicate each informal and formal complaint
on its merits and will employ the full range of sanctions and remedies available to us
under the Act in enforcing Section 255, 716, or 718.730 Thus, we agree with commenters
that the Commission should craft targeted remedies on a case-by-case basis, depending
on the record of the Commission's own investigation or a complaint proceeding.731 For
this same reason, while we agree with consumer groups that the Commission should act
quickly and that time periods should be as short as practicable to ensure that consumers
obtain accessible equipment or services in a timely manner,732 without the particular facts
of a product or service in front of us, we cannot at this time decide what a "reasonable
time" for compliance should be. Nevertheless, as the Commission gains more familiarity
with services, equipment, and devices through its own investigations and resolution of
complaints, our enforcement orders will begin to establish precedent of consistent
injunctive relief, periods of compliance, and other sanctions authorized by the Act.


727 Accessibility NPRM, 26 FCC Rcd at 3183, 132.
728 47 U.S.C. 618(a)(3)(B)(i).
729 See 47 U.S.C. 619(c).
730 See Section 255 Report and Order, 16 FCC Rcd at 6645, 115.
731 See CEA Comments at 43 (Commission should take into account a product's lifecycle and other market
realities); TIA Comments at 29 (remedies should be flexible); CEA Reply Comments at 22. We have
already concluded that retrofitting equipment is not an appropriate remedy. See Accessibility NPRM, 26
FCC Rcd at 3183, 133 (citing Senate and House Reports); CEA Comments at 47 (agreeing with that
conclusion). But see UC Reply Comments at 16 (the Commission should order retrofitting).
732 See IT and Telecom RERCs Comments at 42 ("if too much time is afforded, the product or service may
be obsolete by the time it is brought into compliance"); Words+ Comments at 38 (the time for compliance
should be no more than 18 months). CEA argues that the starting point for a reasonable period of time
should be 18 months for equipment and 12 months for services. CEA Comments at 47.
119

Federal Communications Commission

FCC 11-151

277.
We disagree with AT&T's contention that the Accessibility NPRM's
proposed formal complaint rules exceed the authority granted the Commission under the
CVAA.733 We further disagree with AT&T's specific argument that the Commission
does not have authority to adopt proposed rule section 8.25, which provides that "a
complaint against a common carrier may seek damages."734 As discussed above,735 we
designed the formal complaint rules to address potential violations of Section 255, 716,
or 718. In the Section 255 Report and Order, the Commission decided that a
complainant could obtain damages for a Section 255 violation from a common carrier
under Section 207.736 We agree, however, with AT&T that CVAA services that
constitute information services and are not offered on a common carrier basis would not
be subject to the damages provision of Section 207.737
278.
Neither the CVAA nor the Act addresses permitting prevailing parties to
recover attorney's fees and costs in formal or informal complaint proceedings.738 The
Commission cannot award attorney's fees or costs in a Section 208 formal
complaint proceeding or in any other proceeding absent express statutory authority.739


733 AT&T Comments at 18.
734 AT&T Comments at 18 n.31 (arguing that the CVAA does not provide a right for damages).
735 See Formal Complaints, Section III.E.2.d, supra.
736 See Section 255 Report and Order, 16 FCC Rcd at 6464, 113. See also 47 U.S.C. 207 (providing for
the recovery of damages caused by a common carrier). The Commission rejected a similar argument that
AT&T makes here that Section 255's preclusion of a private court right of action somehow limits the
remedies that the Commission may award under the Communications Act. See id.; AT&T Comments at 18
(arguing that the CVAA's preclusion of a private right of action limits the Commission's ability to award
damages).
737 See AT&T Comments at 18.
738 The IT and Telecom RERCs argue that parties should be awarded attorney's fees and costs. IT and
Telecom RERCs Comments at 40. But see CEA Reply Comments at 20 (disagreeing that the Commission
has such authority); CTIA Reply Comments at 27.
739 Turner v. FCC, 514 F.2d 1354 (1975) (affirming the Commission's decision not to grant attorney's fees
on the grounds that the Commission cannot do so without "clear statutory power" directly on point); AT&T
Co. v. United Artists Payphone Corp
., 852 F. Supp. 221 (holding that the Commission has no authority to
grant attorney's fees under 47 U.S.C. 206), aff'd, 39 F.3d 411 (1994); Station Holdings, Inc. v. Mills Fleet
Farm, Inc.
, Order, 18 FCC Rcd 12787 13 (EB TCD 2003) (in a formal complaint proceeding, neither the
Communications Act nor the Commission's rules authorizes attorney's fees); Implementation of the
Telecommunications Act of 1996: Amendment of Rules Governing Procedures to Be Followed When
Formal Complaints are Filed Against Common Carriers
, Report and Order, 12 FCC Rcd 22497 130
(1997) (the Commission has no authority to award costs, including attorney's fees, in the context of a
formal complaint proceeding); Implementation of the Telecommunications Act of 1996: Amendment of
Rules Governing Procedures to Be Followed When Formal Complaints are Filed Against Common
Carriers
, Notice of Proposed Rulemaking, 111 FCC Rcd 20823 (1997) (same); Erdman Tech. Corp. v. US
Sprint Comm. Co.
, Memorandum Opinion and Order, 11 FCC Rcd 6339 20 (CCB 1996) (same); Electric
Plant Board v. Turner Cable Network Sales, Inc
., Memorandum Opinion and Order, 9 FCC Rcd 4855
25-26 (CSB 1994) (in a program access complaint proceeding, citing Turner v. FCC, "absent an express
grant of authority" under Title V of the Communications Act of 1934, as amended, or the 1992 Cable Act,
the Commission has no authority to award attorney's fees); Pan American Satellite Corp. v.
Communications Satellite Corp.
, Memorandum Opinion and Order, 8 FCC Rcd 4502 16 (CCB 1993) (in
(continued....)
120

Federal Communications Commission

FCC 11-151

We hope that a majority of consumer issues can be resolved through the dispute
assistance process and thereby alleviate the need for consumers to file a complaint at all.
We also note that consumers need not incur any attorney's fees by providing the
Commission with information that allows the Commission to, on its own motion, launch
its own independent investigation, including but not limited to a Letter of Inquiry, into
potential violations by a covered entity. Any party that would like to provide the
Commission with information indicating that a covered entity's product or service is not
in compliance with the Commission's rules may do so, without filing a complaint, by e-
mailing or telephoning the Enforcement Bureau.

IV.

FURTHER NOTICE OF PROPOSED RULEMAKING

A.

Small Entity Exemption

279.
As we explained in the accompanying Report and Order, Section
716(h)(2) of the Act authorizes the Commission to exempt small entities from the
requirements of Section 716, and as an effect, the concomitant obligations of Section
717.740 The exemption relieves from Section 716 small entities that may lack the legal,
technical, or financial ability to incorporate accessibility features, conduct an
achievability analysis, or comply with the Section 717 recordkeeping and certification
requirements.741 In the accompanying Report and Order, we found the record insufficient
to adopt a permanent exemption or to adopt the criteria to be used to determine which
small entities to exempt.742 Instead, we exercised our authority to temporarily exempt all
manufacturers of ACS equipment and providers of ACS that are small business concerns
under applicable SBA rules and size standards.743 The temporary exemption will expire
on the earlier of: (1) the effective date of small entity exemption rules adopted pursuant
to the Further Notice of Proposed Rulemaking; or (2) October 8, 2013.
280.
We first seek comment on whether to permanently exempt from the
obligations of Section 716, manufacturers of ACS equipment and providers of ACS that
qualify as small business concerns under the SBA's rules and size standards and, if so
whether to utilize the size standards for the primary industry in which they are engaged
(Continued from previous page)


a formal complaint proceeding, the Commission had no authority to award attorney's fees); Allnet Comm.
Services
, Inc. v. New York Telephone Co., Memorandum Opinion and Order, 8 FCC Rcd 3087 36 (1993)
(the Commission has no authority to award attorney's fees or costs in a 47 U.S.C. 208 complaint
proceeding); Amendment of Rules Governing Procedures to Be Followed When Formal Complaints Are
Filed Against Common Carriers
, Report and Order, 8 FCC Rcd 2614 69 n.71 (1993) (47 U.S.C. 206
provides attorney's fees in court actions, but not in Commission proceedings); Comark Cable Fund III v.
Northwestern Indiana CATV
, Inc., Memorandum Opinion and Order and Notice of Apparent Liability for
Forfeiture, 100 FCC.2d 1244 31 n.51 (1985) (in a 47 U.S.C. 208 proceeding, the Commission has no
authority to impose attorney's fees).
740 47 U.S.C. 617(h)(2). See Exemptions for Small Entities Temporary Exemption of Section 716
Requirements, Section III.C.3, supra.
741 See Exemptions for Small Entities Temporary Exemption of Section 716 Requirements, Section
III.C.3, supra.
742 See para. 204, supra.
743 See chart at para. 207, supra; 13 C.F.R. 121.101 121.201.
121

Federal Communications Commission

FCC 11-151

under the SBA's rules. The SBA criteria were established for the purpose of determining
eligibility for SBA small business loans. Are these same criteria appropriate for the
purpose of relieving covered entities from the obligations associated with achievability
analyses, recordkeeping, and certifications? If these size criteria are not appropriate for a
permanent exemption, what are the appropriate size criteria? Are there other criteria that
should form the basis of a permanent exemption?
281.
As explained in the Report and Order, small business concerns under the
SBA's rules must meet the SBA size standard for six-digit NAICS codes for the industry
in which the concern is primarily engaged.744 To determine an entity's primary industry,
the SBA "considers the distribution of receipts, employees and costs of doing business
among the different industries in which business operations occurred for the most
recently completed fiscal year. SBA may also consider other factors, such as the
distribution of patents, contract awards, and assets."745 We seek comment on the
applicability of this rule for the permanent small entity exemption.
282.
We seek comment on the applicability of the SBA definition of "business
concern."746 Under SBA's rules, a business concern is an "entity organized for profit,
with a place of business located in the United States, and which operates primarily within
the United States or which makes a significant contribution to the U.S. economy through
payment of taxes or use of American products, materials or labor."747 We also seek
comment on the applicability of other SBA rules for determining whether a business
qualifies as a small business concern, including rules for determining annual receipts or
employees and affiliation between businesses.748
283.
We also seek comment on alternative size standards that the Commission
has adopted in other contexts. In establishing eligibility for spectrum bidding credits, the
Commission has adopted alternative size standards for "very small" and "small"
businesses.749 The Commission has defined "very small" businesses for these purposes as
entities that, along with affiliates, have average gross revenues over the three preceding
years of either $3 million or less, or $15 million or less, depending on the service.750 The


744 See para. 207, supra.
745 13 C.F.R. 121.107.
746 To be a small business concern, entities must meet the definition and requirements of a "business
concern" as established by the SBA. See 13 C.F.R. 121.105.
747 13 C.F.R. 121.105(a)(1).
748 See 13 C.F.R. 121.103, 121.104, 121.106.
749 See 47 C.F.R. 1.2110(f)(2).
750 See 47 C.F.R. 90.912(b) (defining very small business for 800 MHz SMR spectrum licenses as
entities, together with affiliates, with average gross revenue over the preceding three years not to exceed $3
million); 47 C.F.R. 24.720(b) (defining very small business for PCS Block F spectrum licenses as
entities, together with affiliates, with average gross revenue over the preceding three years not to exceed
$15 million). See Section C.3.a & d of the accompanying FRFA for a full listing of the Commission's use
of these size standards.
122

Federal Communications Commission

FCC 11-151

Commission has defined "small" businesses in this context as entities that, along with
affiliates, have average gross revenues over the three preceding years of either $15
million or less, or $40 million or less, depending on the service.751 The Commission has
also adopted detailed rules for determining affiliation between an entity claiming to be a
small business and other entities.752 Finally, in at least one instance, the Commission
defined a small business in the spectrum auction context as an entity that, along with its
affiliates, has $6 million or less in net worth and no more than $2 million in annual
profits (after federal income tax and excluding carry over losses) each year for the
previous two years.753 We seek comment on whether these alternatives -- in whole, in
part, or in combination -- should form the basis for a permanent small entity exemption
from the requirements of Section 716.
284.
The Commission has also used different size standards to define small
cable companies and small cable systems, and the Act includes a definition of small cable
system operators. The Commission has defined small cable companies as a cable
company serving 400,000 or fewer subscribers nationwide,754 and small cable systems as
a cable system serving 15,000 or fewer subscribers.755 The Act defines small cable
system operators as "a cable operator that, directly or through an affiliate, serves in the
aggregate fewer than 1 percent of all subscribers in the United States and is not affiliated
with any entity or entities whose gross annual revenues in the aggregate exceed
$250,000,000."756 We seek comment on whether these alternatives in whole, in part, or
in combination should form the basis for a permanent small entity exemption from the
requirements of Section 716.
285.
In addition, we seek comment on any other criteria that might form all or
part of a permanent small entity exemption. For example, the SBA primarily uses two
measures to determine business size -- the maximum number of employees or maximum
annual receipts of a business concern but it has also applied other measures that
represent the magnitude of operations of a business within an industry, including "total
assets" held by an entity and the "net worth" and "net income" for an entity. Does an


751 See 47 C.F.R. 90.912(b) (defining small business for 800 MHz SMR spectrum licenses as entities,
together with affiliates, with average gross revenue over the preceding three years not to exceed $15
million); 47 C.F.R. 24.720(b) (defining small business for PCS Block F spectrum licenses as entities,
together with affiliates, with average gross revenue over the preceding three years not to exceed $40
million). See Section C.3.a & d of the accompanying FRFA for a full listing of the Commission's use of
these size standards.
752 47 C.F.R. 1.2110(b).
753 Implementation of Section 309(j) of the Communications Act Competitive Bidding, PP Docket No. 93-
253, Fourth Report and Order, 9 FCC Rcd 2330 (1994).
754 47 C.F.R. 76.901(e). The Commission determined that this size standard equates approximately to a
size standard of $100 million or less in annual revenues. Implementation of Sections of the 1992 Cable Act:
Rate Regulation,
Sixth Report and Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393, 7408
(1995).
755 47 C.F.R. 76.901(c).
756 47 U.S.C. 543(m)(2).
123

Federal Communications Commission

FCC 11-151

exemption based on some criterion other than employee count or revenues better meet
Congressional intent? Commenters are encouraged to explain fully any alternative
including the alternative of adopting no exemption for small entities -- and to specifically
support any alternative criteria proffered, including by demonstrating the anticipated
impact on consumers and small entities.
286.
We also seek comment on whether to limit the exemption to only the
equipment or service that is designed while an entity meets the requirements of any small
business exemption we may adopt. If an entity offers for sale a new version, update or
other iteration of the equipment or service, we seek comment on whether the update
automatically should be covered by the exemption or whether the exemption should turn
on whether the entity was still capable of meeting the exemption during the design phase
of the new version, iteration, or update.
287.
We seek comment on whether to make a permanent small entity
exemption self-executing. If self-executing, entities would be able to raise the exemption
during an enforcement proceeding but would otherwise not be required to formally seek
the exemption before the Commission. In this scenario, the entity seeking the exemption
would be required to determine on its own whether it qualifies as a small business
concern.
288.
We seek comment on the impact of a permanent exemption on providers
of ACS, manufacturers of ACS equipment, and consumers. What percentage of, or
which non-interconnected VoIP providers, wireline or wireless service providers,
electronic messaging providers, and ACS equipment manufacturers would qualify as
small business concerns under each size standard? Conversely, what percentage of or
which providers of ACS or manufacturers of equipment used for ACS are not small
business concerns under each size standard? For each ACS and ACS equipment market
segment, what percentage of the market is served by entities that are not exempt using
each size standard?
289.
We seek comment on the compliance costs that ACS providers and ACS
equipment manufacturers would incur absent a permanent exemption. What would the
costs be for compliance with Section 716 and Section 717 across different providers of
ACS and ACS equipment manufacturers if we decline to adopt any permanent exemption
or decline to make the temporary exemption permanent? In particular, what are the costs
of conducting an achievability analysis, recordkeeping, and providing certifications?
290.
We seek comment generally on the impact of a small business exemption
on consumers. Are there ACS or ACS equipment that may significantly benefit people
with disabilities that are provided or manufactured by entities that might be exempt? If
so, what are the services or equipment or the types of services or equipment, and how
would the exemption impact people with disabilities? Would a permanent exemption
disproportionately impact people with disabilities in rural areas versus urban or suburban
areas? How would a permanent exemption impact people with disabilities living on
tribal lands? To what extent would a permanent exemption impact the ability of people
with disabilities to access new ACS innovations or ACS equipment innovations? Will a
permanent exemption have a greater impact on the accessibility of some segments of
ACS or ACS equipment than others?
124

Federal Communications Commission

FCC 11-151

291.
We intend to monitor the impact of any exemption, including whether it is
promoting innovation as Congress intended or whether it is having unanticipated negative
consequences on accessibility of ACS. While we propose not to time limit any
exemption, we retain the ability to modify or repeal the exemption if doing so would
serve the public interest and is consistent with Congressional intent.757 We seek comment
on these proposals.

B.

Section 718 Implementation

292.
Under Section 718, a mobile phone manufacturer that includes a browser,
or a mobile phone service provider that arranges for a browser to be included on a mobile
phone, must ensure that the browser functions are accessible to and usable by individuals
who are blind or have a visual impairment, unless doing so is not achievable.758 Congress
provided that the effective date for these requirements is three years after the enactment
of the CVAA, i.e., October 8, 2013.
293.
In enacting Section 718,759 we believe that Congress carved out an
exception to Section 716 and delayed the effective date to address a special class of
browsers for a specific subset of the disabilities community because of the unique
challenges of achieving non-visually accessible solutions in a mobile phone and the
relative youth of accessible development for mobile platforms. This technical complexity
arises because three accessibility technologies, often developed by different parties, must
be synchronized effectively together for a browser to be accessible to a blind user of a
mobile phone: (1) an accessibility API760 of the operating system; (2) the implementation
of that API by the browser; and (3) its implementation by a screen reader. Because non-
visual accessibility is generally the most technically challenging form of accessibility to
accomplish,761 an accessibility API is needed to render the underlying meaning of key


757 Several commenters argue for a time-limited exemption for small entities. See Wireless RERC
Comments at 5 ("[O]ne year seems appropriate with a reapplication process that requires a stronger burden
for renewal."); ACB Reply Comments at 23-24 ("[W]aivers for covered small entities in question [should]
only be granted for a term whose length shall not exceed more than 12 months."). As long as an entity
remains a small entity under our proposed rules, they will be exempt from compliance. However, we will
monitor the exemption to ensure it meets Congress's intent.
758 See 47 U.S.C. 619(a). See also House Report at 27 ("The Committee also intends that the service
provider and the manufacturer are each only subject to these provisions with respect to a browser that such
service provider or manufacturer directs or specifies to be included in the device.")
759 See 47 U.S.C. 619.
760 An Application Programming Interface (API) is software that an application program uses to request
and carry out lower-level services performed by the operating system of a computer or telephone. See
Harry Newton, Newton's Telecom Dictionary, 68 (CMP Books, 20th ed. 2004).
761 Non-visual accessibility for mobile browsers typically involves the coordination of several components,
as discussed above. See also W3C Web Accessibility Initiative, ESSENTIAL COMPONENTS OF WEB
ACCESSIBILITY, http://www.w3.org/WAI/intro/components.php (last visited Aug. 17, 2011). Making the
necessary changes is thus likely to be more difficult. See BARBARA VAN SCHEWICK, INTERNET
ARCHITECTURE AND INNOVATION 117 (2010) ("In general, the costs of changing an architecture rise with
the number and complexity of architectural components involved in the change."); cf. LEN BASS ET AL.,
SOFTWARE ARCHITECTURE IN PRACTICE 82 (1998) (explaining that sometimes a simple change across more
(continued....)
125

Federal Communications Commission

FCC 11-151

elements of a graphical user interface in an alternate, non-visual form, such as synthetic
speech or refreshable Braille. For example, while Microsoft has developed Microsoft
Active Accessibility (MSAA), the dominant accessibility API on Windows desktop
computers, it has not yet defined and deployed an accessibility API for the current
Windows phone platform that can be utilized by browser and screen reader developers
for that platform.762 Even after an API becomes available, a significant process of
coordination, testing, and refinement is needed to ensure that the browser/server and
screen reader/client components can interact in a comprehensive and robust manner.
294.
Additional lead-time must also be built-in as this kind of technical
development and coordination is needed on each mobile platform. Present technological
trends have resulted in relatively short generations of mobile platforms, each benefiting
from increasing miniaturization of hardware components and increased bandwidth for
transmitting data to and from the cloud. Experimentation and innovation with new ways
of maximizing the productivity of mobile platforms, given these technological trends, has
made accessibility coordination difficult. Finally, additional challenges are presented by
the technical limitations posed by mobile platforms (lower memory capacity, low-
bandwidth constraints, smaller screens) coupled with the fact that web content often has
to be specially formatted to run on mobile platforms.763
295.
In the context of discussing the development of accessible mobile phone
options for persons who are blind, deaf-blind, or have low vision, the industry has
acknowledged the technological shortcomings in the ability of both hardware and
software to incorporate accessibility features in mobile phones. Specifically, TIA has
indicated that "[not] all mobile devices can support the additional fundamental
components needed to provide a full screen reader feature; there may be limitations in the
software platform or limitations in the accompanying hardware, e.g., processing power,
memory limitations."764 TIA also indicated that more advanced accessibility features are
not easily integrated and require the development of specific software codes for each
feature on each device. Sprint, however, asserts that over time, mobile phones will
eventually evolve like personal computers have, from "out-of-the-box" systems to
today's dynamic, highly customizable systems, as mobile device performance metrics
(Continued from previous page)


components may be easier to implement than a complex change across fewer components). In addition to
these higher costs of implementation (development, testing, and documentation), coordination and
adaptation costs are higher across firm boundaries and rise with the greater number of firms involved. See
VAN SCHEWICK at 117, 127, 131-36.
762 See Paul Schroeder and Darren Burton, Microsoft Backtracks on Accessibility in New Mobile Operating
System, Commits to Accessibility in Future Windows Phone Platform
, 11 ACCESSWORLD, no. 8, Dec. 2010,
available at http://www.afb.org/afbpress/pub.asp?DocID=aw110802.
763 Concurrent with the passage of the CVAA has been the rapid increase in, and highly competitive
development of, the number of mobile browser offerings in the market place and their hardware and
software are significantly different from desktop browsers and each other, even within phones from the
same manufacturer. See http://www.pcworld.com/article/230885/attack_of_the_mobile_browsers.html.
764 See TIA Comments to the July Public Notice in CG Docket 10-145, at 9.
126

Federal Communications Commission

FCC 11-151

such as processing speed, power, and memory capacity improve.765 In short, as mobile
device technologies continue to evolve over time, corresponding improvements in
hardware and software will improve accessibility in the future.
296.
We seek comment on our proposed clarification that Congress added
Section 718 as an exception to the general coverage of Internet browsers as software
subject to the requirements of Section 716 for Internet browsers built in or installed on
mobile phones used by individuals who are blind or have a visual impairment because of
the unique challenges associated with achieving mobile access for this particular
community. We also seek comment on the best way(s) to implement Section 718, so as
to afford affected manufacturers and service providers the opportunity to provide input at
the outset, as well as to make the necessary arrangements to achieve compliance by the
time the provisions go into effect.766
297.
We seek further comment on Code Factory's recommendation that
manufacturers and operating system developers develop an accessibility API to foster the
incorporation of screen readers into mobile platforms across different phones, which
would render the web browser and other mobile phone functions accessible to individuals
who are blind or visually impaired.767 Would an accessibility API simplify the process
for developing accessible screen readers for mobile phones and if so, should there be a
separate API for each operating system that supports a browser? Is there a standard-
setting body to develop such APIs or would such a process have to be driven by the
manufacturers of mobile operating system software? What are the technical challenges,
for both software developers and manufacturers, involved in developing an accessibility
API?
298.
What are the specific technical challenges involved in developing screen
reader software applications for each mobile platform (e.g., iPhone, Android, Windows
Mobile)? What security questions are raised by the use of screen readers? Are there
specific security risks posed to operating systems by the presence of screen readers?
What types of technical support/customer service will mobile phone operators need to
provide to ensure initial and continued accessibility in browsers that are built into mobile
phones? Are there steps the Commission could take to facilitate effective, efficient, and
achievable accessibility solutions?
299.
We seek to better understand these technical complexities and how we can
encourage effective collaboration among the service providers, and the manufacturers of
end user devices, the operating system, the browser, screen readers and other


765 See Sprint Comments to the July Public Notice in CG Docket 10-145, at 2.
766 See Verizon Comments at 7-8 (suggesting that access to electronic messaging services via a web
browser is insufficient to trigger accessibility requirements for the device manufacturer). This issue is
related to and was raised in the context of whether services and applications providing access to an
electronic messaging service, such as a broadband platform that provides an end user access to an web-
based e-mail service, are covered under the Act. Accessibility NPRM, 26 FCC Rcd at 3147, 34. Because
browsers may be used to access multiple forms of advanced communications services, we address the
obligations of manufacturers with respect to browsers here.
767 Code Factory Reply Comments to October Public Notice at 1-3.
127

Federal Communications Commission

FCC 11-151

stakeholders. We particularly welcome input on how the Commission can facilitate the
development of solutions to the technical challenges associated with ensuring access to
Internet browsers in mobile phones.
300.
With respect to equipment and services covered by Section 716, the
accompanying Report and Order gradually phases in obligations of covered entities with
full compliance required on October 8, 2013 in order to encourage covered entities to
implement accessibility features early in product development cycles, to take into account
the complexity of these regulations, and to temper our regulations' effect on previously
unregulated entities. We found this approach to be consistent with Commission
precedent where we have utilized phase-in periods in similarly complex rulemakings.768
As we have stated above, we believe that Congress drafted Section 718 as a separate
provision from Section 716 to emphasize the importance of ensuring access to mobile
browsers for people who are blind or visually impaired because of the unique technical
challenges associated with ensuring effective interaction between browsers and screen
readers operating over a mobile platform. Given these complex technical issues, we seek
comment on what steps we should take to ensure that the mobile phone industry will be
prepared to implement accessibility features when Section 718 becomes effective on
October 8, 2013.

C.

Interoperable Video Conferencing Services

1.

Meaning of Interoperable

301.
In the Accessibility NPRM, the Commission asked how to define
"interoperable" in a manner that is faithful to both the statutory language and the broader
purposes of the CVAA, to ensure that "such services may, by themselves, be accessibility
solutions" and "that individuals with disabilities are able to access and control these
services" as Congress intended.769 Many commenters appear to consider "inter-platform,
inter-network, and inter-provider" as requisite characteristics of interoperability.770 ITI
suggests that "interoperability between platforms is not currently achievable," but that


768 See CEA Reply Comments at 4, (citing Closed Captioning Requirements for Digital Television
Receivers
, Report and Order, 15 FCC Rcd 16788, 16807 56 (2000); Wireless E911 Location Accuracy
Requirements
, Report and Order, 22 FCC Rcd 20105, 20112 17 (2007), voluntarily vacated, Rural
Cellular Ass'n v. FCC
, 2008 U.S. App. LEXIS 19889 (D.C. Cir. Sept. 17, 2008)); ITI Comments at 19,
(citing 47 C.F.R. 15.119(a); 47 C.F.R. 15.120(a); 47 C.F.R. 15.122(a)(1); 47 C.F.R. 15.117(i)(1)(i)-
(iii)); CEA Ex Parte in CG Docket No. 10-213 at 2 (citing Technical Requirements to Enable Blocking of
Video Programming based on Program Ratings
, Report and Order, 13 FCC Rcd 11248, 11257 23 (1998);
Implementation of Section 304 of the Telecommunications Act of 1996, Report and Order, 13 FCC Rcd
14775, 14803 69 (1998); Hearing Aid Compatibility R&O, 18 FCC Rcd 16780 65).
769 Accessibility NPRM, 26 FCC Rcd at 3151, 46, citing Senate Report at 6, House Report at 25.
770 See CEA Comments at 14-15; CTIA Comments at 22-23; ESA Comments at 3; ITI Comments at 24;
Microsoft Comments at 6; TechAmerica Comments at 4-5; TIA Comments at 11. See also Letter from
Danielle Coffey, Vice President, Telecommunications Industry Association, to Marlene H. Dortch,
Secretary, FCC, CG Docket No. 10-213, at 1 (filed Aug. 10, 2011) ("TIA August 10 Ex Parte") (asserting
that this understanding of "interoperable" is reflected in Commission rules and precedent and consistent
with the IEEE definition of "interoperable" as the "ability of a system or a product to work with other
products without special effort on the part of the consumer").
128

Federal Communications Commission

FCC 11-151

Congress recognized that some forms of accessibility will take time and that "[t]his is an
example of such a situation."771 We are concerned that this proposed definition would
exclude virtually all existing video conferencing services and equipment from the
accessibility requirements of Section 716, which we believe would be contrary to
Congressional intent.772
302.
We believe that interoperability is a characteristic of usability for many
individuals who are deaf or hard of hearing and for whom video conferencing services
are, by themselves, accessibility solutions.773 We also agree with Consumer Groups that
"[w]ithout interoperability, communication networks [are] segmented and require
consumers to obtain access to multiple, closed networks using particularized
equipment."774 For example, video relay service ("VRS") equipment users must obtain
and use other video conferencing services and equipment to engage in real-time video
communication with non-VRS-equipment users. In addition to possibly defining
"interoperable" as "inter-platform, inter-network, and inter-provider," ITI also suggests
that the term "interoperable" could be defined as "interoperable with [VRS] or among
different video conferencing services."775 As an alternative, the IT and Telecom RERCs
suggest that a system that publishes its standard and allows other manufacturers or


771 ITI Comments at 24. But see Letter from Andrew S. Phillips, Counsel to National Association of the
Deaf, on behalf of the Coalition of Organizations for Accessible Technology ("COAT"), to Marlene H.
Dortch, Secretary, FCC, CG Docket No. 10-213, at 2 (filed Sept. 27, 2011) ("COAT Sept. 27 Ex Parte")
(urging that "interoperable" "not be defined in a way that will leave this part of the law moot or make it
easy for the industry to deliberately make its products non-interoperable").
772 See para. 46, supra, noting that earlier versions of the legislation did not include the word
"interoperable" in the definition of the term "advanced communications services" and that the definition of
"interoperable video conferencing services" in the enacted legislation is identical to the definition of "video
conferencing services" found in earlier versions. Further, both the Senate Report regarding "interoperable
video conferencing services" and the House Report regarding "video conferencing services" are identical
and state that "[t]he inclusion . . . of these services within the scope of the requirements of this act is to
ensure, in part, that individuals with disabilities are able to access and control these services" and that "such
services may, by themselves, be accessibility solutions." Id., citing Senate Report at 6, House Report at 25.
773 See Accessibility NPRM, 26 FCC Rcd at 3151, 46, citing Senate Report at 6, House Report at 25. For
example, in addition to using real-time video communications when communicating in sign language
through VRS and point-to-point with other sign language users, real-time video communications provide
many deaf and hard of hearing individuals with access to visual communication cues that aid in speech
reading.
774 Consumer Groups Comments at 11. For example, our TRS rules permit only deaf, hard of hearing,
deaf-blind, or speech disabled individuals who communicate in sign language to obtain VRS video
conferencing services and equipment. See Telecommunications Relay Services and Speech-to-Speech
Services for Individuals with Hearing and Speech Disabilities
; E911 Requirements for IP-Enabled Service
Providers
, CG Docket No. 03-123, WC Docket No. 05-196, Second Report and Order and Order on
Reconsideration, 24 FCC Rcd 791, 807-808, 34 (2008). As a result, interoperable video conferencing
services are available between VRS users, but not between VRS users and others.
775 See ITI Comments at 24; IT and Telecom RERCs Comments at 14-15 (suggesting that the
interoperability requirements for VRS may be more than what should be required to qualify as
"interoperable" under the CVAA).
129

Federal Communications Commission

FCC 11-151

service providers to build products or services to work with it should be considered
interoperable.776
303.
Accordingly, we seek comment on the following alternative definitions of
"interoperable" in the context of video conferencing services and equipment used for
those services: (1) "interoperable" means able to function inter-platform, inter-network,
and inter-provider; (2) "interoperable" means having published or otherwise agreed-upon
standards that allow for manufacturers or service providers to develop products or
services that operate with other equipment or services operating pursuant to the
standards; or (3) "interoperable" means able to connect users among different video
conferencing services, including VRS.
304.
We seek comment on each of the above proposed definitions of
"interoperable." Should only one of the proposed definitions be adopted, and should we
reject the other two definitions, or should we adopt multiple definitions and find that
video conferencing services are interoperable as long as any one of the three definitions is
satisfied? In other words, should we consider the three proposed definitions as three
alternative tests for interoperability? In regard to the first alternative "inter-platform,
inter-network, and inter-provider" we seek comment on the extent to which video
conferencing services or equipment must be different or distinct to qualify under this
definition. In regard to the second alternative, when does a standard determine
interoperability? Is publication by a standards-setting body enough, even if only one
manufacturer or service provider follows that standard? If a manufacturer or service
provider publishes a standard and invites others to utilize it, is that enough to establish
interoperability? If not, is interoperability established as soon as a second manufacturer
or service provider utilizes the standard? If not, what is enough to establish
interoperability? If two or more manufacturers or service providers agree to a standard
without publication, is interoperability established? If not, is interoperability established
if they invite others to receive a private copy of the standards, but do not publish the
standards for public consumption? If video conferencing services can be used to
communicate with public safety answering points, does that establish interoperability? If
not, what else must be done to establish interoperability? Does the ability to connect to
VRS make a video conferencing service "interoperable" or "accessible" or both? If users
of different video conferencing services, including VRS, can communicate with each
other, does that establish interoperability, even if there are no set standards? If
communications among different services is not enough, what then is enough to establish
interoperability?
305.
Interest in and consumer demand for cross-platform, network, and
provider video conferencing services and equipment continues to rise.777 We do not


776 See IT and Telecom RERCs Comments at 16.
777 See Mark Milian, "Why Apple, Google, Microsoft won't streamline video chat," CNN, May 16, 2011,
available at http://www.cnn.com/2011/TECH/mobile/05/16/video.chat.standard/ (visited June 15, 2011).
See also Stephen Lawson, "Polycom, carriers to tie videoconferencing systems" (article about the new
Open Visual Communications Consortium (OVCC), spearheaded by Polycom with Verizon, AT&T, and
others as members), Network World, June 1, 2011, available at
http://www.networkworld.com/news/2011/060111-polycom-carriers-to-tie-videoconferencing.html (visited
(continued....)
130

Federal Communications Commission

FCC 11-151

believe that interoperability among different platforms will "hamper service providers'
attempts to distinguish themselves in the marketplace and thus hinder innovation."778
While we consider this matter more fully in this Further Notice, we urge industry "to
develop standards for interoperability between video conferencing services as it has done
for text messaging, picture and video exchange among carriers operating on different
technologies and equipment."779 We also urge industry, consumers, and other
stakeholders to identify performance objectives that may be necessary to ensure that
"such services may, by themselves, be accessibility solutions" and "that individuals with
disabilities are able to access and control these services" as Congress intended.780 In
other words, what does "accessible to and usable by individuals with disabilities" mean in
the context of interoperable video conferencing services and equipment? Are
accessibility performance and other objectives different for "interoperable" video
conferencing services?781 Notwithstanding existing obligations under the Act, we
propose that industry considers accessibility alongside the technical requirements and
standards that may be needed to achieve interoperability so that as interoperable video
conferencing services and equipment come into existence, they are also accessible.782
2.

Coverage of Video Mail

306.
In the Accessibility NPRM, the Commission sought comment on whether
services that otherwise meet the definition of interoperable video conferencing services
but that also provide non-real-time or near real-time functions (such as "video mail") are
covered and subject to the requirements of Section 716.783 If such functions are not
covered, the Commission asked whether it should, similar to what it did in the Section
255 context, assert its ancillary jurisdiction to cover video mail.784
(Continued from previous page)


June 15, 2011). See also Brian Stelter, "Comcast to Offer Customers Skype Video Calls on Their TVs,"
New York Times, June 13, 2011, available at
http://www.nytimes.com/2011/06/14/business/media/14comcast.html?_r=1&ref=todayspaper (visited June
13, 2011). See also TIA August 10 Ex Parte at 2-3 (describing the substantial progress and "efforts []
underway on multiple fronts in the quest to bring interoperable video conferencing to consumers").
778 T-Mobile Comments at 7.
779 Verizon Comments at 9.
780 Accessibility NPRM, 26 FCC Rcd at 3151, 46, citing Senate Report at 6, House Report at 25.
781 For example, does accessibility for individuals who are deaf or hard of hearing include being enabled to
connect with an interoperable video conferencing service call through a relay service other than VRS?
How can we ensure that video conferencing services and equipment are accessible to people with other
disabilities, such as people who are blind or have low vision, or people with mobility, dexterity, cognitive,
or intellectual disabilities?
782 Interoperable video conferencing services and equipment, when offered by providers and manufacturers,
must be accessible to and usable by individuals with disabilities, as required by Section 716, and such
providers and manufacturers are subject to the recordkeeping and annual certification requirements of
Section 717 starting on the effective date of these rules.
783 Accessibility NPRM, 26 FCC Rcd at 3149-50, 42.
784 Specifically, the Commission employed its ancillary jurisdiction to extend the scope of Section 255 to
both voice mail and interactive menu services under Part 7 of the Commission's rules because "the failure
(continued....)
131

Federal Communications Commission

FCC 11-151

307.
We agree with commenters that non-real-time or near-real-time features or
functions of a video conferencing service, such as video mail, do not meet the definition
of "real-time" video communications.785 Nonetheless, we do not have a sufficient record
as to whether we should exercise our ancillary jurisdiction to require that a video mail
service be accessible to individuals with disabilities when provided along with a video
conferencing service as we did in the context of Section 255 in regard to voice mail, and
we now seek comment on this issue.786 The record is also insufficient to decide whether
our ancillary jurisdiction extends to require other features or functions provided along
with a video conferencing service, such as recording and playing back video
communications on demand, to be accessible, and we seek comment on this issue as
well.787 Do we have other sources of direct authority, besides Section 716, to require that
video mail and other features, such as recording and playing back video communications,
are accessible to individuals with disabilities? Would the failure to ensure accessibility
of video mail and the related equipment that performs these functions undermine the
accessibility and usability of interoperable video conferencing services? Similarly,
would the failure to ensure accessibility of recording and playing back video
communications on demand and the related equipment that performs these functions
undermine the accessibility and usability of interoperable video conferencing services?

D.

Accessibility of Information Content

308.
Section 716(e)(1)(B) of the Act requires the Commission to promulgate
regulations providing that advanced communications services and the equipment and
networks used with these services may not impair or impede the accessibility of
information content when accessibility has been incorporated into that content for
transmission through such services, equipment or networks. In the accompanying Report
and Order
, we adopt this broad rule, incorporating the text of Section 716(e)(1)(B), as
(Continued from previous page)


to ensure accessibility of voicemail and interactive menu services, and the related equipment that performs
these functions, would [have] seriously undermined the accessibility and usability of telecommunications
services required by sections 255 and 251(a)(2)." Accessibility NPRM, 26 FCC Rcd at 3150, 42, citing
Section 255 Report and Order
, 16 FCC Rcd at 6455-6462, 93-108 (the Commission relied on an
assertion of ancillary jurisdiction to achieve its policy objective of ensuring accessibility and usability for
persons with disabilities in extending the requirements of Section 255 to two information services,
voicemail and interactive menu service, that it found critical to making telecommunications services and
equipment accessible and usable).
785 See, e.g., CEA Comments at 15-16; CTIA Comments at 21; NCTA Reply Comments at 6-7; Verizon
Comments at 9. As a technical matter, "video mail" may not be "real-time" communication, but, as a
practical matter, if an interoperable video conferencing service and equipment is accessible, the video mail
feature or function will likely also be accessible.
786 See note 784, supra. See also CEA Comments at 15-16 (consideration of video mail is premature);
CTIA Comments at 21 (asserting that the definition precludes the exercise of our ancillary jurisdiction).
But see Consumer Groups Comments at 9 (urging us to exercise our ancillary jurisdiction to require
accessibility).
787 See IT and Telecom RERCs Comments at 12 (asserting that "if a person with a disability is unable to
attend a live videoconference, that person should not lose the ability to access it through a later download
or streaming, if non-disabled participants can access it later").
132

Federal Communications Commission

FCC 11-151

proposed in the Accessibility NPRM.788 Here, we seek comment on the IT and Telecom
RERCs' suggestion that we interpret the phrase "may not impair or impede the
accessibility of information content"789 to include the concepts set forth below. An
excerpt of the IT and Telecom RERCs' proposal regarding how we should interpret and
apply our accessibility of information content guidelines is provided in Appendix F,
including the following recommendations that covered entities:790
o shall not install equipment or features that can't or don't support
accessibility information;
o shall not configure network equipment such that it would block or discard
accessibility information;
o shall display any accessibility related information that is present in an
industry recognized standard format;
o shall not block users from substituting accessible versions of content; and
o shall not prevent the incorporation or passing along of accessibility
related information.

E.

Electronically Mediated Services

309.
In the accompanying Report and Order, we declined to expand our
definition of peripheral devices to mean "devices employed in connection with
equipment covered by this part, including software and electronically mediated services,
to translate, enhance, or otherwise transform advanced communications services into a
form accessible to people with disabilities" as the IT and Telecom RERCs propose).791
Because the record is insufficient, we seek further comment on the IT and Telecom
RERCs' proposal and on the definition of "electronically mediated services." We also
seek comment on the extent to which electronically mediated services are covered under
Section 716 and how they can be used to transform ACS into an accessible form.792

F.

Performance Objectives

310.
Section 716(e)(1)(A) of the Act provides that in prescribing regulations for
this section, the Commission shall "include performance objectives to ensure the
accessibility, usability, and compatibility of advanced communications services and the
equipment used for advanced communications services by individuals with
disabilities."793 In the Accessibility NPRM, the Commission sought comment on how to


788 47 U.S.C. 617(e)(1)(B); Accessibility NPRM, 26 FCC Rcd at 3197, Appendix B: Proposed Rules.
789 47 U.S.C. 617(e)(1)(B).
790 IT and Telecom RERCs June 17 Ex Parte at 2.
791 IT and Telecom RERCs Comments at 27-28 (emphasis added). See Accessibility NPRM, 26 FCC Rcd
at 3196, Subpart B Definitions, 8.4(r).
792 IT and Telecom RERCs Comments at 27-28.
793 47 U.S.C. 617(e)(1)(A).
133

Federal Communications Commission

FCC 11-151

make its performance standards testable, concrete, and enforceable.794 In the
accompanying Report and Order, we incorporated into the performance objectives the
definitions of accessible,795 compatibility,796 and usable,797 in sections 6.3 and 7.3 of the
Commission's rules. In their Reply Comments, however, the IT and Telecom RERCs
argued that, instead of relying on our Part 6 requirements, the Commission's performance
objectives should include testable criteria.798 The IT and Telecom RERCs proposed
specific "Aspirational Goal and Testable Functional Performance Criteria"799 in their
Reply Comments, set forth in Appendix G. We seek comment on those criteria.800

G.

Safe Harbors

311.
As explained in the accompanying Report and Order, we decline at this
time to adopt technical standards as safe harbors.801 However, we recognize the
importance of the various components in the ACS architecture working together to
achieve accessibility and seek comment on whether certain safe harbor technical
standards can further this goal.802
312.
Specifically, we seek comment on whether, as ITI proposes, ACS
manufacturers can ensure compliance with the Act "by programmatically exposing the
ACS user interface using one or more established APIs and specifications which support
the applicable provisions in ISO/IEC 13066-1:2011."803 Other standards may also form


794 Accessibility NPRM, 26 FCC Rcd at 3172, 105.
795 See 47 C.F.R. 6.3(a) which provides that "input, control, and mechanical functions shall be locatable,
identifiable, and operable" as follows:
-Operable without vision
-Operable with low vision and limited or no hearing
-Operable with little or no color perception
-Operable without hearing
-Operable with limited manual dexterity
-Operable with limited reach or strength
-Operable without time-dependent controls
-Operable without speech
-Operable with limited cognitive skills
796 47 C.F.R. 6.3(b)(1)-(4).
797 47 C.F.R. 6.3(l). Section 6.3(l) provides that "usable" "mean[s] that individuals with disabilities have
access to the full functionality and documentation for the product, including instructions, product
information (including accessible feature information), documentation, and technical support functionally
equivalent to that provided to individuals without disabilities."
798 IT and Telecom RERCs Reply Comments at 5, Attachment A.
799 See infra Appendix G.
800 IT and Telecom RERCs Reply Comments at Attachment A.
801 Safe Harbors, Section III.D.2, supra.
802 See Manufacturers of Equipment Used for Advanced Communications Services, Section III.A.2, supra.
803 ITI August 9 Ex Parte at 2.
134

Federal Communications Commission

FCC 11-151

the basis of a safe harbor for compliance with Section 716, including the "W3C/WAI
Web Content Accessibility Guidelines, Version 2.0 and Section 508 of the Rehabilitation
Act of 1973, as amended."804 We seek comment on the use of these standards, and any
others, as safe harbors for compliance with Section 716.
313.
For the purpose of keeping safe harbors up-to-date with technology and
ensuring ongoing compliance with the Act, we seek comment on whether "it should be
the responsibility of the appropriate manufacturer or standards body to inform the
Commission when new, relevant APIs and specifications are made available to the
market that meet the . . . standard."805 If we decide to adopt a safe harbor based on
recognized industry standards, we seek comment on how the industry, consumers, and
the Commission can verify compliance with the standard. Should entities be required to
self-certify compliance with a safe harbor? Is there a standard for which consumers can
easily test compliance with an accessible tool? What are the compliance costs for ACS
manufacturers and service providers of the Commission adopting safe harbor technical
standards based on recognized industry standards? Will adopting safe harbor technical
standards based on recognized industry standards reduce compliance costs for ACS
manufacturers and service providers?
314.
We recognize tension may exist between the relatively slow standards
setting process and the rapid pace of technological innovation.806 How should the
Commission account for the possibility that the continued development of a standard on
which a safe harbor is based may be outpaced by technology? Should we for purposes of
determining compliance with a safe harbor apply only safe harbors that were recognized
industry standards at the time of the design phase for the equipment or service in
question? Is there another time period in the development of the equipment or service
that is more appropriate?

H.

Section 718 Recordkeeping and Enforcement

315.
Background. In the Accessibility NPRM, the Commission invited
comment on recordkeeping requirements for Section 718 covered entities.807 The
Commission noted that recordkeeping requirements for Section 718 entities would be
considered further in light of comments on general Section 718 implementation.808 The
Commission also sought comment on informal complaint,809 formal complaint,810 and


804 Letter from Ken J. Salaets, Director, Information Technology Industry Council, to Marlene H. Dortch,
Secretary, FCC, CG Docket No. 10-213, at 2 (filed Aug. 29, 2011).
805 ITI August 9 Ex Parte at 2.
806 See RERC-IT Reply Comments to October Public Notice at 7.
807 Accessibility NPRM, 26 FCC Rcd at 3177-80, 117-123.
808 See Accessibility NPRM, 26 FCC Rcd at 3178, 121 n.353.
809 Accessibility NPRM, 26 FCC Rcd at 3184-86, 134-140.
810 Accessibility NPRM, 26 FCC Rcd at 3186-87, 141-142.
135

Federal Communications Commission

FCC 11-151

other general requirements for complaints alleging violations of Section 718 and the
Commission's implementing rules.811
316.
Discussion. In the Report and Order accompanying this Further Notice,
we adopt the same recordkeeping and complaint procedures for Section 718 covered
entities that we adopt for Section 716 covered entities.812 Specifically, we adopt
recordkeeping requirements for Section 718 covered entities that go into effect one year
after the effective date of the rules adopted in the accompanying Report and Order.813
We also adopt informal complaint and formal complaint procedures as well as other
general requirements for complaints filed against Section 718 covered entities for
violations of Section 718 and the Commission's implementing rules.814 These complaint
procedures go into effect for Section 718 covered entities on October 8, 2013, three years
after the CVAA was enacted.815
317.
In this Further Notice, we seek comment on the implementation of Section
718 specifically. In this section, we invite comment on whether the Section 718
recordkeeping requirements, which we adopt in the accompanying Report and Order,
should be retained or altered in light of the record developed in response to this Further
Notice
on Section 718. We ask that parties suggesting changes to the rules provide an
assessment of the relative costs and benefits associated with (1) the rule they wish to see
changed and (2) the alternative that they propose.

V.

PROCEDURAL MATTERS

A.

Ex Parte Rules Permit-But-Disclose

318.
The proceeding shall be treated as a "permit-but-disclose" proceeding in
accordance with the Commission's ex parte rules.816 Persons making ex parte
presentations must file a copy of any written presentation or a memorandum summarizing
any oral presentation within two business days after the presentation (unless a different
deadline applicable to the Sunshine period applies). Persons making oral ex parte
presentations are reminded that memoranda summarizing the presentation must (1) list all
persons attending or otherwise participating in the meeting at which the ex parte
presentation was made, and (2) summarize all data presented and arguments made during
the presentation. If the presentation consisted in whole or in part of the presentation of


811 Accessibility NPRM, 26 FCC Rcd at 3181-84, 128-133.
812 See Accessibility Report and Order, Section 717 Recordkeeping and Enforcement, Section III.E supra.
813 See Accessibility Report and Order, Recordkeeping, Section III.E.1, supra.
814 See Accessibility Report and Order, Section 717 Recordkeeping and Enforcement, Section III.E, supra.
815 See 47 U.S.C. 619 note ("EFFECTIVE DATE FOR SECTION 718. - Section 718 of the Commissions
Act of 1934 . . . shall take effect 3 years after the date of enactment of this Act.").
816 47 C.F.R. 1.1200 et seq.
136

Federal Communications Commission

FCC 11-151

data or arguments already reflected in the presenter's written comments, memoranda or
other filings in the proceeding, the presenter may provide citations to such data or
arguments in his or her prior comments, memoranda, or other filings (specifying the
relevant page and/or paragraph numbers where such data or arguments can be found) in
lieu of summarizing them in the memorandum. Documents shown or given to
Commission staff during ex parte meetings are deemed to be written ex parte
presentations and must be filed consistent with rule 1.1206(b). In proceedings governed
by rule 1.49(f) or for which the Commission has made available a method of electronic
filing, written ex parte presentations and memoranda summarizing oral ex parte
presentations, and all attachments thereto, must be filed through the electronic comment
filing system available for that proceeding, and must be filed in their native format (e.g.,
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize
themselves with the Commission's ex parte rules.

B.

Comment Filing Procedures

319.
Pursuant to sections 1.415 and 1.419 of the Commission's rules, 47 CFR
1.415, 1.419, interested parties may file comments and reply comments on or before
the dates indicated on the first page of this document. Comments may be filed using the
Commission's Electronic Comment Filing System (ECFS). See Electronic Filing of
Documents in Rulemaking Proceedings
, 63 FR 24121 (1998).

Electronic Filers: Comments may be filed electronically using the Internet by
accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/.

Paper Filers: Parties who choose to file by paper must file an original and one
copy of each filing. If more than one docket or rulemaking number appears in the
caption of this proceeding, filers must submit two additional copies for each
additional docket or rulemaking number.
Filings can be sent by hand or messenger delivery, by commercial overnight
courier, or by first-class or overnight U.S. Postal Service mail. All filings must be
addressed to the Commission's Secretary, Office of the Secretary, Federal
Communications Commission.

All hand-delivered or messenger-delivered paper filings for the
Commission's Secretary must be delivered to FCC Headquarters at 445
12th St., SW, Room TW-A325, Washington, DC 20554. The filing hours
are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with
rubber bands or fasteners. Any envelopes and boxes must be disposed of
before entering the building.

Commercial overnight mail (other than U.S. Postal Service Express Mail
and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol
Heights, MD 20743.
137

Federal Communications Commission

FCC 11-151


U.S. Postal Service first-class, Express, and Priority mail must be
addressed to 445 12th Street, SW, Washington DC 20554.
320.
People with Disabilities: To request materials in accessible formats for
people with disabilities (Braille, large print, electronic files, audio format), send an e-mail
to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-
0530 (voice), 202-418-0432 (tty).

C.

Final Regulatory Flexibility Analysis

321.
The Regulatory Flexibility Act (RFA)817 requires that an agency prepare a
regulatory flexibility analysis for notice and comment rulemakings, unless the agency
certifies that "the rule will not, if promulgated, have a significant economic impact on a
substantial number of small entities."818 Accordingly, we have prepared a Final
Regulatory Flexibility Analysis concerning the possible impact of the rule changes
contained in the Report and Order on small entities. The Final Regulatory Flexibility
Analysis is set forth in Appendix D.

D.

Final Paperwork Reduction Analysis

322.
This document contains new information collection requirements subject
to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. It will be submitted
to the Office of Management and Budget (OMB) for review under Section 3507(d) of the
PRA. OMB, the general public, and other federal agencies are invited to comment on the
new information collection requirements contained in this proceeding. In addition, we
note that pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-
198, see 44 U.S.C. 3506(c)(4), we previously sought specific comment on how the
Commission might further reduce the information collection burden for small business
concerns with fewer than 25 employees.
323.
In this proceeding, we adopt new recordkeeping rules that provide clear
guidance to covered entities on the records they must keep to demonstrate compliance
with our new rules. We require covered entities to keep the three categories of records
set forth in Section 717(a)(5)(A).819 We also require annual certification by a corporate
officer that the company is keeping the required records. We have assessed the effects of
these rules and find that any burden on small businesses will be minimal because we have
adopted the minimum recordkeeping requirements that allow covered entities to keep
records in any format they wish. This approach takes into account the variances in
covered entities (e.g., size, experience with the Commission), recordkeeping methods,
and products and services covered by the CVAA. Furthermore, this approach provides
the greatest flexibility to small businesses and minimizes the impact that the statutorily
mandated requirements impose on small businesses. Correspondingly, we considered


817 See 5 U.S.C. 601612. The RFA has been amended by the Small Business Regulatory Enforcement
Fairness Act of 1996 (SBREFA), Pub. L. No. 104-121, Title II, 110 Stat. 857 (1996).
818 5 U.S.C. 605(b).
81947 U.S.C. 618(a)(5)(A)(i)-(iii).
138

Federal Communications Commission

FCC 11-151

and rejected the alternative of imposing a specific format or one-size-fits-all system for
recordkeeping that could potentially impose greater burdens on small businesses.
Moreover, the certification requirement is possibly less burdensome on small businesses
than large, as it merely requires certification from an officer that the necessary records
were kept over the previous year; this is presumably a less resource intensive certification
for smaller entities. Finally, we adopt a requirement that consumers must file a "Request
for Dispute Assistance" with the Consumer and Governmental Affairs' Disability Rights
Office as a prerequisite to filing an informal complaint with the Enforcement Bureau.
This information request in beneficial because it will trigger Commission involvement
before a complaint is filed and will benefit both consumers and industry by helping to
clarify the accessibility needs of consumers. It will also encourage settlement discussions
between the parties in an effort to resolve accessibility issues without the expenditure of
time and resources in the informal complaint process. We also note that we have
temporarily exempted small entities from the rules we have adopted herein while we
consider, in the Further Notice, whether we should grant a permanent exemption, and
what criteria should be associated with such an exemption.

E.

Initial Regulatory Flexibility Analysis

324.
As required by the Regulatory Flexibility Act of 1980 (RFA),820 the
Commission has prepared an Initial Regulatory Flexibility Analysis (IRFA) of the
possible significant economic impact on small entities of the policies and rules proposed
in the Further Notice of Proposed Rulemaking. The analysis is found in Appendix E.
We request written public comment on the analysis. Comments must be filed in
accordance with the same deadlines as comments filed in response to the Further Notice
and must have a separate and distinct heading designating them as responses to the IRFA.
The Commission's Consumer and Governmental Affairs Bureau, Reference Information
Center, will send a copy of this CVAA Further Notice, including the IRFA, to the Chief
Counsel for Advocacy of the Small Business Administration.

F.

Initial Paperwork Reduction Analysis

325.
The Further Notice of Proposed Rule Making contains proposed new or
modified information collection requirements. The Commission, as part of its continuing
effort to reduce paperwork burdens, invites the general public and the Office of
Management and Budget (OMB) to comment on the information collection requirements
contained in this document, as required by the Paperwork Reduction Act of 1995, Public
Law 104-13. Public and agency comments are due 60 days after the date of publication
in the Federal Register. Comments should address: (a) whether the proposed collection
of information is necessary for the proper performance of the functions of the
Commission, including whether the information shall have practical utility; (b) the
accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility,
and clarity of the information collected; and (d) ways to minimize the burden of the
collection of information on the respondents, including the use of automated collection
techniques or other forms of information technology. In addition, pursuant to the Small


820 See 5 U.S.C. 603.
139

Federal Communications Commission

FCC 11-151

Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C.
3506(c)(4), we seek specific comment on how we might "further reduce the information
collection burden for small business concerns with fewer than 25 employees." We note
that we have described impacts that might affect small businesses, which includes most
businesses with fewer than 25 employees, in the IRFA in Appendix E, infra.

G.

Further Information

326.
For further information, please contact Rosaline Crawford, Consumer and
Governmental Affairs Bureau, at 202-418-2075 or rosaline.crawford@fcc.gov; Brian
Regan, Wireless Telecommunications Bureau, at 202-418-2849 or brian.regan@fcc.gov;
or Janet Sievert, Enforcement Bureau, at 202-418-1362 or janet.sievert@fcc.gov.

VI.

ORDERING CLAUSES

327.
Accordingly, IT IS ORDERED that pursuant to Sections 1-4, 255, 303(r),
403, 503, 716, 717, and 718 of the Communications Act of 1934, as amended, 47 U.S.C.
151-154, 255, 303(r), 403, 503, 617, 618, and 619, this Report and Order IS HEREBY
ADOPTED.
328.
IT IS FURTHER ORDERED that Parts 1, 6 and 7 of the Commission's
Rules, 47 C.F.R. Parts 1, 6, and 7, ARE AMENDED, and new Part 14 of the
Commission's Rules, 47 C.F.R. Part 14 IS ADDED as specified in Appendix B, effective
30 days after publication of the Report and Order in the Federal Register, except for the
provisions in section 14.17, which contain an information collection that is subject to OMB
approval.821
329.
IT IS FURTHER ORDERED that the information collection contained in
this Report and Order WILL BECOME EFFECTIVE following approval by the Office
of Management and Budget. The Commission will publish a document at a later date
establishing the effective date.
330.
IT IS FURTHER ORDERED that, pursuant to the authority of Sections 1-
4, 255, 303(r), 403, 503, 716, 717, and 718 of the Communications Act of 1934, as
amended, 47 U.S.C. 151-154, 255, 303(r), 403, 503, 617, 618, and 619, this Further
Notice of Proposed Rulemaking
IS HEREBY ADOPTED.
331.
IT IS FURTHER ORDERED that pursuant to applicable procedures set
forth in sections 1.415 and 1.419 of the Commission's Rules, 47 C.F.R. 1.415, 1.419,
interested parties may file comments on this Further Notice of Proposed Rulemaking on
or before 45 days after publication of the Further Notice of Proposed Rulemaking in the
Federal Register and reply comments on or before 75 days after publication in the
Federal Register.
332.
IT IS FURTHER ORDERED that the Commission's Consumer
Information Bureau, Reference Information Center, SHALL SEND a copy of the Report


821 See 5 U.S.C. 553(d)(3) ("[t]he required publication or service of a substantive rule shall be made not
less than 30 days before its effective date, except . . . as otherwise provided by the agency for good cause
found and published with the rule"); see also 47 C.F.R. 1.103(a), 1.427(b).
140

Federal Communications Commission

FCC 11-151

and Order and Further Notice of Proposed Rulemaking, including the Final Regulatory
Flexibility Analysis and Initial Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
141

Federal Communications Commission

FCC 11-151

APPENDIX A

List of Commenters

(CG Docket No. 10-213)
This is a list of parties who filed comments and reply comments within the designated
comment periods in the proceeding. The complete record in this proceeding is available
in the Electronic Comment Filing System located at http://www.fcc.gov/cgb/ecfs/.

Comments
Advanced Communication Provisions of The Twenty-First Century Communications
and Video Accessibility Act of 2010
, CG Docket No. 10-213, Notice of Proposed
Rulemaking, 26 FCC Rcd 3133 (2011).

Abbreviation

Commenter

Adaptivation, Inc.1
AFB
American Foundation for the Blind
AT&T
AT&T Services, Inc.
ATIS
Alliance for Telecommunications Industry Solutions
Blooston Rural Carriers
CEA
Consumer Electronics Association
Convo
Convo Communications, LLC
Consumer Groups
National Association of the Deaf (NAD), et al.
CSD
Communication Service for the Deaf, Inc.
CTIA
CTIA-The Wireless Association
Eipper
William Eipper
ESA
Entertainment Software Association
IT and Telecom RERCs
Rehabilitation Engineering Research Centers on Universal
Interface & Information Technology Access (RERC-IT)
and

Telecommunications Access (RERC-TA)2
ITI
Information Technology Industry Council


1 Jonathan Eckrich is the filer of record.
2 Gregg C. Vanderheiden is the filer of record.

Federal Communications Commission

FCC 11-151

Microsoft
Microsoft Corp.
Motorola
Motorola Solutions, Inc.
NCTA
National Cable & Telecommunications Association
NetCoalition
NetCoalition
NTCA
National Telecommunications Cooperative Association
OnStar
OnStar, LLC
Railey
Larry Railey
Sorenson
Sorenson Communications, Inc.
TIA
Telecommunications Industry Association
Time Warner
Time Warner Cable, Inc.
T-Mobile
T-Mobile USA, Inc.
Verizon
Verizon and Verizon Wireless
VON Coalition
Voice on the Net Coalition
Vonage
Vonage Holdings Corporation
Wireless RERC
Wireless RERC
Words+ and Compusult
Words+, Inc. and Compusult Systems, Inc.3


3 Jeffrey A. Dahlen is the filer of record.
2

Federal Communications Commission

FCC 11-151

Abbreviation

Reply Commenter

AAPD
American Association of People with Disabilities
AbleLink
AbleLink Technologies4
Adaptive Solutions
Adaptive Solutions5
ACB
American Council of the Blind
AFB
American Foundation for the Blind6
ATIS
Alliance for Telecommunications Industry Solutions
CEA
Consumer Electronics Association
Code Factory
Coleman Institute and
Coleman Institute and Samuelson-Glushko Tech Law and
Policy
Samuelson-Glushko TLPC
Clinic7
Compusult
Compusult Limited8
Consumer Groups
National Association of the Deaf (NAD), et al.
CSD
Communication Service for the Deaf, Inc.
CSDVRS
CSDVRS, LLC
CTIA
CTIA-The Wireless Association
ESA
Entertainment Software Association
Garris
Yvonne Garris
Google
Google Inc.
Green
Gillian Green
Hamilton and Purple
Hamilton Relay, Inc. and Purple Communications, Inc.
IT and Telecom RERCs
Rehabilitation Engineering Research Centers on Universal
Interface & Information Technology Access (RERC-IT)
and
Telecommunications Access (RERC-TA)9
Kolesar
Ron Kolesar
Lingraphicare
Lingraphicare America, Inc.10


4 Joan Cunningham is the filer of record.
5 Sherion J. Hollingsworth is the filer of record.
6 Mark D. Richert is the filer of record.
7 Angela Tse is the filer of record.
8 Paul Mitten is the filer of record.
9 The IT and Telecom RERCs are the filers of record.
3

Federal Communications Commission

FCC 11-151

NFB
National Federation of the Blind
Nintendo
Nintendo of America, Inc.
O'Rourke
John O'Rourke
Point-and-Read
Point-and-Read, Inc.11
Potter
Kurt Potter
Wireless RERC
Rehabilitation Engineering Research Center for Wireless
Technologies12
Sandefur
RJ Sandefur
Verizon
Verizon and Verizon Wireless
Vonage
Vonage Holdings Corporation
(Continued from previous page)


10 Andrew Gomory is the filer of record.
11 Benjamin Slotznick is the filer of record.
12 Wireless RERC is the filer of record.
4

Federal Communications Commission

FCC 11-151

APPENDIX B

Final Rules

The Federal Communications Commission amends Parts 1, 6 and 7 and adds new Part 14

of Title 47 of the Code of Federal Regulations as follows:

Part 1 of Title 47 of the Code of Federal Regulations is amended as follows:

1.
The authority citation for Part 1 reads as follows:
AUTHORITY: 15 U.S.C. 79 et seq.; 47 U.S.C. 151, 154, 160, 201, 225, 303, 617 and 618.
2.
The Federal Communications Commission amends 1.80 by redesignating
paragraphs (b)(3), (b)(4), and (b)(5) as paragraphs (b)(4), (b)(5) and (b)(6) and by
adding new paragraph(b)(3) and revising newly redesignated paragraph (b)(5) to read
as follows:
1.80 Forfeiture Proceedings
* * * * *
(b) * * *
(3) If the violator is a manufacturer or service provider subject to the requirements of
Section 255, 716 or 718 of the Communications Act, and is determined by the
Commission to have violated any such requirement, the manufacturer or service provider
shall be liable to the United States for a forfeiture penalty of not more than $100,000 for
each violation or each day of a continuing violation, except that the amount assessed for
any continuing violation shall not exceed a total of $1,000,000 for any single act or
failure to act.
(4) ***
(5) In any case not covered in paragraphs (b)(1), (b)(2), (b)(3), or (b)(4) of this section,
the amount of any forfeiture penalty determined under this section shall not exceed
$16,000 for each violation or each day of a continuing violation, except that the amount
assessed for any continuing violation shall not exceed a total of $112,500 for any single
act or failure to act described in paragraph (a) of this section.
* * * * * *

Part 6 of Title 47 of the Code of Federal Regulations is amended as follows:

3.
The authority citation for Part 6 reads as follows:

Federal Communications Commission

FCC 11-151

AUTHORITY: 47 U.S.C. 151-154, 251, 255, 303(r), 617, 618.
4.
The Federal Communications Commission amends Part 6 by revising 6.15 and
6.16 as follows.
6.15 Generally.
(a) All manufacturers of telecommunications equipment or customer premises equipment and all
providers of telecommunications services, as defined under this subpart are subject to the
enforcement provisions specified in the Act and the Commission's rules.
(b) For purposes of 6.15 through 6.23, the term "manufacturers" shall denote manufacturers of
telecommunications equipment or customer premises equipment and the term "providers" shall
denote providers of telecommunications services.
6.16 Informal or formal complaints
Sections 6.17 through 6.23 of this subpart shall sunset on October 8, 2013. On October 8, 2013,
any person may file either a formal or informal complaint against a manufacturer or provider
alleging violations of Section 255 or this Part subject to the enforcement requirements set forth
in 14.30 through 14.52 of this chapter.

Part 7 of Title 47 of the Code of Federal Regulations is amended as follows:

5.
The authority citation for Part 7 reads as follows:
AUTHORITY: 47 U.S.C. 151, 154(i), 154(j), 208, 255, 617, 618.
6.
The Federal Communications Commission amends Part 7 by revising 7.15 and
7.16 as follows:
7.15 Generally
(a) For purposes of 7.157.23 of this subpart, the term ``manufacturers" shall denote any
manufacturer of telecommunications equipment or customer premises equipment which
performs a voicemail or interactive menu function.
(b) All manufacturers of telecommunications equipment or customer premises equipment and all
providers of voicemail and interactive menu services, as defined under this subpart, are subject to
the enforcement provisions specified in the Act and the Commission's rules.
(c) The term "providers" shall denote any provider of voicemail or interactive menu service.
2

Federal Communications Commission

FCC 11-151

7.16 Informal or formal complaints
Section 7.17 through 7.23 of this subpart shall sunset on October 8, 2013. On October 8, 2013,
any person may file either a formal or informal complaint against a manufacturer or provider
alleging violations of Section 255 or this Part subject to the enforcement requirements set forth
in 14.30 through 14.52 of this chapter.

Title 47 of the Code of Federal Regulations is amended by adding the following new Part
14:

PART 14 - ACCESS TO ADVANCED COMMUNICATIONS SERVICES AND
EQUIPMENT BY PEOPLE WITH DISABILITIES

Subpart A Scope

14.1 Applicability.
14.2 Limitations.
14.3 Exemption for Customized Equipment or Services.
14.4 Exemption for Small Entities.
14.5 Waivers Multi-purpose Services and Equipment.

Subpart B Definitions

14.10 Definitions.

Subpart C Implementation Requirements What must Covered Entities Do?

14.20 Obligations.
14.21 Performance Objectives.

Subpart D Recordkeeping, Consumer Dispute Assistance, and Enforcement

14.30 Generally.
14.31 Recordkeeping.
14.32 Consumer Dispute Assistance.
14.33 Informal or formal complaints.
14.34 Informal complaints; form, filing, content, and consumer assistance.
14.35 Procedure; designation of agents for service.
14.36 Answers and Replies to informal complaints.
14.37 Review and disposition of informal complaints.
14.38 Formal Complaints; General pleading requirements.
14.39 Format and content of formal complaints.
14.40 Damages.
14.41 Joinder of complainants and causes of action.
14.42 Answers.
14.43 Cross-complaints and counterclaims.
14.44 Replies.
3

Federal Communications Commission

FCC 11-151

14.45 Motions.
14.46 Formal complaints not stating a cause of action; defective pleadings.
14.47 Discovery.
14.48 Confidentiality of information produced or exchanged by the parties.
14.49 Other required written submissions.
14.50 Status conference.
14.51 Specifications as to pleadings, briefs, and other documents; subscription.
14.52 Copies; service; separate filings against multiple defendants.
AUTHORITY: 47 U.S.C. 151-154, 255, 303, 403, 503, 617, 618 unless otherwise noted.

Subpart A Scope

14.1 Applicability.
Except as provided in 14.2, 14.3, 14.4 and 14.5 of this chapter, the rules in this part apply to:
(a) Any manufacturer of equipment used for advanced communications services, including end
user equipment, network equipment, and software, that such manufacturer offers for sale or
otherwise distributes in interstate commerce;
(b) Any provider of advanced communications services that such provider offers in or affecting
interstate commerce.
14.2 Limitations.
(a) Except as provided in paragraph (b), no person shall be liable for a violation of the
requirements of the rules in this part with respect to advanced communications services or
equipment used to provide or access advanced communications services to the extent such
person--
(1) transmits, routes, or stores in intermediate or transient storage the communications
made available through the provision of advanced communications services by a third
party; or
(2) provides an information location tool, such as a directory, index, reference, pointer,
menu, guide, user interface, or hypertext link, through which an end user obtains access
to such advanced communications services or equipment used to provide or access
advanced communications services.
(b) The limitation on liability under paragraph (a) shall not apply to any person who relies on
third party applications, services, software, hardware, or equipment to comply with the
requirements of the rules in this part with respect to advanced communications services or
equipment used to provide or access advanced communications services.
4

Federal Communications Commission

FCC 11-151

(c) The requirements of this part shall not apply to any equipment or services, including
interconnected VoIP service, that were subject to the requirements of Section 255 of the Act on
October 7, 2010, which remain subject to Section 255 of the Act, as amended, and subject to the
rules in parts 6 and 7 of this chapter, as amended.
14.3 Exemption for Customized Equipment or Services.
(a) The rules in this part shall not apply to customized equipment or services that are not offered
directly to the public, or to such classes of users as to be effectively available directly to the
public, regardless of the facilities used.
(b) A provider of advanced communications services or manufacturer of equipment used for
advanced communications services may claim the exemption in paragraph (a) as a defense in an
enforcement proceeding pursuant to subpart D of this part, but is not otherwise required to seek
such an affirmative determination from the Commission.
14.4 Exemption for Small Entities.
(a) A provider of advanced communications services or a manufacturer of equipment used for
advanced communications services to which this part applies is exempt from the obligations of
this part if such provider or manufacturer, at the start of the design of a product or service:
(1) qualifies as a business concern under section 13 C.F.R. 121.105; and
(2) together with its affiliates, as determined by 13 C.F.R. 121.103, meets the relevant
small business size standard established in 13 C.F.R. 121.201 for the primary industry in
which it is engaged as determined by 13 C.F.R. 121.107.
(b) A provider or manufacturer may claim this exemption as a defense in an enforcement
proceeding pursuant to subpart D of this part, but is not otherwise required to seek such an
affirmative determination from the Commission.
(c) This exemption will expire no later than October 8, 2013.
14.5 Waivers Multipurpose Services and Equipment.
(a) Waiver.
(1) On its own motion or in response to a petition by a provider of advanced
communications services, a manufacturer of equipment used for advanced communications
services, or by any interested party, the Commission may waive the requirements of this
part for any feature or function of equipment used to provide or access advanced
5

Federal Communications Commission

FCC 11-151

communications services, or for any class of such equipment, for any provider of advanced
communications services, or for any class of such services, that

(i) is capable of accessing an advanced communications service and;
(ii)is designed for multiple purposes, but is designed primarily for purposes other
than using advanced communications services.
(2) For any waiver petition under this section, the Commission will examine on a case-by-
case basis
(i) whether the equipment or service is designed to be used for advanced
communications purposes by the general public; and
(ii) whether and how the advanced communications functions or features are
advertised, announced, or marketed.
(b) Class Waiver. For any petition for a waiver of more than one advanced communications
service or one piece of equipment used for advanced communications services where the service
or equipment share common defining characteristics, in addition to the requirements of section
14.5(a)(1) and (2), the Commission will examine the similarity of the service or equipment
subject to the petition and the similarity of the advanced communications features or functions of
such services or equipment.
(c) Duration.
(1) A petition for a waiver of an individual advanced communications service or equipment
used for advanced communications services may be granted for the life of the service or
equipment as supported by evidence on the record, or for such time as the Commission
determines based on evidence on the record.
(2) A petition for a class waiver may be granted for a time to be determined by the
Commission based on evidence on the record, including the lifecycle of the equipment or
service in the class. Any class waiver granted under this section will waive the obligations
of this part for all advanced communications services and equipment used for advanced
communications services subject to a class waiver and made available to the public prior to
the expiration of such waiver.
(d) Public Notice. All petitions for waiver filed pursuant to this section shall be put on public
notice, with a minimum of a 30-day period for comments and oppositions.

Subpart B Definitions

14.10 Definitions.
(a) The term accessible shall have the meaning provided in 14.21(b).
(b) The term achievable shall mean with reasonable effort or expense, as determined by the Commission.
In making such a determination, the Commission shall consider:
(i) The nature and cost of the steps needed to meet the requirements of Section 716 of the
Act and this part with respect to the specific equipment or service in question;
6

Federal Communications Commission

FCC 11-151

(ii) The technical and economic impact on the operation of the manufacturer or provider and
on the operation of the specific equipment or service in question, including on the
development and deployment of new communications technologies;
(iii) The type of operations of the manufacturer or provider; and
(iv) The extent to which the service provider or manufacturer in question offers accessible
services or equipment containing varying degrees of functionality and features, and offered
at differing price points.
(c) The term advanced communications services shall mean:
(1) Interconnected VoIP service, as that term is defined in this section;
(2) Non-interconnected VoIP service, as that term is defined in this section;
(3) Electronic messaging service, as that term is defined in this section; and
(4) Interoperable video conferencing service, as that term is defined in this section.
(d) The term application shall mean software designed to perform or to help the user perform a specific
task or specific tasks, such as communicating by voice, electronic text messaging, or video conferencing.
(e) The term compatible shall have the meaning provided in 14.21(d).
(f) The term customer premises equipment shall mean equipment employed on the premises of a person
(other than a carrier) to originate, route, or terminate telecommunications.
(g)The term customized equipment or services shall mean equipment and services that are produced or
provided to meet unique specifications requested by a business or enterprise customer and not otherwise
available to the general public, including public safety networks and devices.
(h) The term disability shall mean a physical or mental impairment that substantially limits one or more of
the major life activities of an individual; a record of such an impairment; or being regarded as having such
an impairment.
(i) The term electronic messaging service means a service that provides real-time or near real-time non-
voice messages in text form between individuals over communications networks.
(j) The term end user equipment shall mean equipment designed for consumer use. Such equipment may
include both hardware and software components.
(k) The term hardware shall mean a tangible communications device, equipment, or physical component
of communications technology, including peripheral devices, such as a smart phone, a laptop computer, a
desktop computer, a screen, a keyboard, a speaker, or an amplifier.
(l) The term interconnected VoIP service shall have the same meaning as in 9.3 of this chapter,
as such section may be amended from time to time.
7

Federal Communications Commission

FCC 11-151

(m) An interoperable video conferencing service means a service that provides real-time video
communications, including audio, to enable users to share information of the user's choosing.
(n) The term manufacturer shall mean an entity that makes or produces a product, including equipment
used for advanced communications services, including end user equipment, network equipment, and
software.
(o) The term network equipment shall mean equipment facilitating the use of a network, including,
routers, network interface cards, networking cables, modems, and other related hardware. Such
equipment may include both hardware and software components.
(p) The term nominal cost in regard to accessibility and usability solutions shall mean small enough so as
to generally not be a factor in the consumer's decision to acquire a product or service that the consumer
otherwise desires.
(q) A non- interconnected VoIP service is a service that:
(a) Enables real-time voice communications that originate from or terminate to the user's
location using Internet protocol or any successor protocol; and
(b) Requires Internet protocol compatible customer premises equipment; and
(c) Does not include any service that is an interconnected VoIP service.
(r) The term peripheral devices shall mean devices employed in connection with equipment, including
software, covered by this part to translate, enhance, or otherwise transform advanced communications
services into a form accessible to individuals with disabilities.
(s) The term service provider shall mean a provider of advanced communications services that are
offered in or affecting interstate commerce, including a provider of applications and services that can be
used for advanced communications services and that can be accessed (i.e., downloaded or run) by users
over any service provider network.
(t) The term software shall mean programs, procedures, rules, and related data and documentation that
direct the use and operation of a computer or related device and instruct it to perform a given task or
function.
(u) The term specialized customer premises equipment shall mean customer premise equipment which is
commonly used by individuals with disabilities to achieve access.
(v) The term usable shall have the meaning provided in 14.21(c) of this part.

Subpart C Implementation Requirements What must Covered Entities Do?

14.20 Obligations.
(a) General Obligations.
(1) With respect to equipment manufactured after the effective date of this part, a manufacturer of
equipment used for advanced communications services, including end user equipment, network
8

Federal Communications Commission

FCC 11-151

equipment, and software, must ensure that the equipment and software that such manufacturer
offers for sale or otherwise distributes in interstate commerce shall be accessible to and usable by
individuals with disabilities, unless the requirements of this subsection are not achievable.
(2) With respect to services provided after the effective date of this part, a provider of advanced
communications services must ensure that services offered by such provider in or affecting
interstate commerce are accessible to and usable by individuals with disabilities, unless the
requirements of this subsection are not achievable.
(3) If accessibility is not achievable either by building it in or by using third party accessibility
solutions available to the consumer at nominal cost and that individuals with disabilities can
access, then a manufacturer or service provider shall ensure that its equipment or service is
compatible with existing peripheral devices or specialized customer premises equipment, unless
the requirements of this subsection are not achievable.
(4) Providers of advanced communications services shall not install network features, functions,
or capabilities that impede accessibility or usability.
(5) Providers of advanced communications services, manufacturers of equipment used with these
services, and providers of networks used with these services may not impair or impede the
accessibility of information content when accessibility has been incorporated into that content for
transmission through such services, equipment or networks.
(b) Product design, development, and evaluation.
(1) Manufacturers and service providers must consider performance objectives set forth in section
14.21 at the design stage as early as possible and must implement such performance objectives, to
the extent that they are achievable.
(2) Manufacturers and service providers must identify barriers to accessibility and usability as
part of such evaluation.
(c) Information Pass Through.
Equipment used for advanced communications services, including end user equipment, network
equipment, and software must pass through cross-manufacturer, nonproprietary, industry-
standard codes, translation protocols, formats or other information necessary to provide advanced
communications services in an accessible format, if achievable. Signal compression technologies
shall not remove information needed for access or shall restore it upon decompression.
(d) Information, documentation, and training.
Manufacturers and service providers must ensure that the information and documentation that
they provide to customers is accessible, if achievable. Such information and documentation
includes, but is not limited to, user guides, bills, installation guides for end user devices, and
product support communications. The requirement to ensure the information is accessible also
includes ensuring that individuals with disabilities can access, at no extra cost, call centers and
customer support regarding both the product generally and the accessibility features of the
product.
9

Federal Communications Commission

FCC 11-151

14.21 Performance Objectives.
(a) Generally Manufacturers and service providers shall ensure that equipment and
services covered by this part are accessible, usable, and compatible as those terms are
defined in paragraphs (b) through (d) of this section.
(b) Accessible The term accessible shall mean that:
(1) Input, control, and mechanical functions shall be locatable, identifiable, and
operable in accordance with each of the following, assessed independently:
(i) Operable without vision. Provide at least one mode that does not require
user vision.
(ii)Operable with low vision and limited or no hearing. Provide at least one
mode that permits operation by users with visual acuity between 20/70
and 20/200, without relying on audio output.
(iii) Operable with little or no color perception. Provide at least one mode that
does not require user color perception.
(iv) Operable without hearing. Provide at least one mode that does not require
user auditory perception.
(v) Operable with limited manual dexterity. Provide at least one mode that
does not require user fine motor control or simultaneous actions.
(vi) Operable with limited reach and strength. Provide at least one mode that
is operable with user limited reach and strength.
(vii) Operable with a Prosthetic Device. Controls shall be operable without
requiring body contact or close body proximity.
(viii) Operable without time-dependent controls. Provide at least one mode
that does not require a response time or allows response time to be by-passed
or adjusted by the user over a wide range.
(ix) Operable without speech. Provide at least one mode that does not require
user speech.
(x) Operable with limited cognitive skills. Provide at least one mode that
minimizes the cognitive, memory, language, and learning skills required of the
user.
(2) All information necessary to operate and use the product, including but not
limited to, text, static or dynamic images, icons, labels, sounds, or incidental
operating cues, [shall] comply with each of the following, assessed independently:
(i) Availability of visual information. Provide visual information through at
least one mode in auditory form.
10

Federal Communications Commission

FCC 11-151

(ii) Availability of visual information for low vision users. Provide visual
information through at least one mode to users with visual acuity between
20/70 and 20/200 without relying on audio.
(iii) Access to moving text. Provide moving text in at least one static
presentation mode at the option of the user.
(iv) Availability of auditory information. Provide auditory information
through at least one mode in visual form and, where appropriate, in tactile
form.
(v) Availability of auditory information for people who are hard of hearing.
Provide audio or acoustic information, including any auditory feedback tones
that are important for the use of the product, through at least one mode in
enhanced auditory fashion (i.e., increased amplification, increased
signal-to-noise ratio, or combination).
(vi) Prevention of visually-induced seizures. Visual displays and indicators
shall minimize visual flicker that might induce seizures in people with
photosensitive epilepsy.
(vii) Availability of audio cutoff. Where a product delivers audio output
through an external speaker, provide an industry standard connector for
headphones or personal listening devices (e.g., phone-like handset or earcup)
which cuts off the speaker(s) when used.
(viii) Non-interference with hearing technologies. Reduce interference to
hearing technologies (including hearing aids, cochlear implants, and assistive
listening devices) to the lowest possible level that allows a user to utilize the
product.
(ix) Hearing aid coupling. Where a product delivers output by an audio
transducer which is normally held up to the ear, provide a means for effective
wireless coupling to hearing aids.
(c) Usable: The term usable shall mean that individuals with disabilities have access to
the full functionality and documentation for the product, including instructions,
product information (including accessible feature information), documentation and
technical support functionally equivalent to that provided to individuals without
disabilities.
(d) Compatible: The term compatible shall mean compatible with peripheral devices
and specialized customer premises equipment, and in compliance with the following
provisions, as applicable:
(1) External electronic access to all information and control mechanisms. Information
needed for the operation of products (including output, alerts, icons, on-line help, and
documentation) shall be available in a standard electronic text format on a cross-industry
standard port and all input to and control of a product shall allow for real time operation
11

Federal Communications Commission

FCC 11-151

by electronic text input into a cross-industry standard external port and in cross-industry
standard format. The cross-industry standard port shall not require manipulation of a
connector by the user.
(2) Connection point for external audio processing devices. Products providing auditory
output shall provide the auditory signal at a standard signal level through an industry
standard connector.
(3) TTY connectability. Products that provide a function allowing voice communication
and which do not themselves provide a TTY functionality shall provide a standard non-
acoustic connection point for TTYs. It shall also be possible for the user to easily turn
any microphone on and off to allow the user to intermix speech with TTY use.
(4) TTY signal compatibility. Products, including those providing voice communication
functionality, shall support use of all cross-manufacturer non-proprietary standard signals
used by TTYs.

Subpart D Recordkeeping, Consumer Dispute Assistance, and Enforcement

14.30 Generally.
(a) The rules in this subpart regarding recordkeeping and enforcement are applicable to all
manufacturers and service providers that are subject to the requirements of Sections 255, 716,
and 718 of the Act and parts 6, 7 and this part of the rules.
(b) The requirements set forth in 14.31 of this subpart shall be effective [INSERT DATE 30
DAYS PLUS 1 YEAR AFTER PUBLICATION IN THE FEDERAL REGISTER].

(c) The requirements set forth in 14.32 through 14.37 of this subpart shall be effective on
October 8, 2013.
14.31 Recordkeeping.
(a) Each manufacturer and service provider subject to Section 255, 716, or 718 of the Act, must
create and maintain, in the ordinary course of business and for a two year period from the date a
product ceases to be manufactured or a service ceases to be offered, records of the efforts taken
by such manufacturer or provider to implement Sections 255, 716, and 718 with regard to this
product or service, as applicable, including:
(1) information about the manufacturer's or service provider's efforts to consult with individuals
with disabilities;
(2) descriptions of the accessibility features of its products and services; and
(3) information about the compatibility of its products and services with peripheral devices or
specialized customer premise equipment commonly used by individuals with disabilities to
achieve access.
12

Federal Communications Commission

FCC 11-151

(b) An officer of each manufacturer and service provider subject to Section 255, 716, or 718 of
the Act, must sign and file an annual compliance certificate with the Commission.
(1) The certificate must state that the manufacturer or service provider, as applicable, has
established operating procedures that are adequate to ensure compliance with the recordkeeping
rules in this subpart and that records are being kept in accordance with this section and be
supported with an affidavit or declaration under penalty of perjury, signed and dated by the
authorized officer of the company with personal knowledge of the representations provided in
the company's certification, verifying the truth and accuracy of the information therein.
(2) The certificate shall identify the name and contact details of the person or persons within the
company that are authorized to resolve complaints alleging violations of our accessibility rules
and Sections 255, 716, and 718 of the Act, and the agent designated for service pursuant to
14.35(b) of this subpart and provide contact information for this agent. Contact information shall
include, for the manufacturer or the service provider, a name or department designation, business
address, telephone number, and, if available TTY number, facsimile number, and e-mail address.
(3) The annual certification must be filed with the Commission on April 1, 2013 and annually
thereafter for records pertaining to the previous calendar year. The certificate must be updated
when necessary to keep the contact information current.
(c) Upon the service of a complaint, formal or informal, on a manufacturer or service provider
under this subpart, a manufacturer or service provider must produce to the Commission, upon
request, records covered by this section and may assert a statutory request for confidentiality for
these records under 47 U.S.C. 618(a)(5)(C) and 0.457(c) of this chapter. All other
information submitted to the Commission pursuant to this subpart or pursuant to any other
request by the Commission may be submitted pursuant to a request for confidentiality in
accordance with 0.459 of this chapter.
14.32 Consumer Dispute Assistance.
(a) A consumer or any other party may transmit a Request for Dispute Assistance to the
Consumer and Governmental Affairs Bureau by any reasonable means, including by
the Commission's online informal complaint filing system, U.S. Mail, overnight
delivery, or e-mail to dro@fcc.gov. Any Requests filed using a method other than the
Commission's online system should include a cover letter that references Section 255,
716, or 718 or the rules of parts 6, 7, or this part and should be addressed to the
Consumer and Governmental Affairs Bureau. Any party with a question about
information that should be included in a Request for Dispute Assistance should e-mail
the Commission's Disability Rights Office at dro@fcc.gov or call 202-418-2517
(voice), 202-418-2922 (TTY).
(b)
A Request for Dispute Assistance shall include:
(1) The name, address, e-mail address, and telephone number of the party making
the Request (Requester);
(2) The name of the manufacturer or service provider that the requester believes is
in violation of Section 255, 716, or 718 or the rules in this part, and the name,
13

Federal Communications Commission

FCC 11-151

address, and telephone number of the manufacturer or service provider, if
known;
(3) An explanation of why the requester believes the manufacturer or service
provider is in violation of Section 255, 716, or 718 or the rules in this part,
including details regarding the service or equipment and the relief requested,
and all documentation that supports the requester's contention;
(4) The date or dates on which the requester either purchased, acquired, or used (or
attempted to purchase, acquire, or use) the equipment or service in question;
(5) The Requester's preferred format or method of response to its Request for
Dispute Assistance by CGB or the manufacturer or service provider (e.g., letter,
facsimile transmission, telephone (voice/TRS/TTY), e-mail, audio-cassette
recording, Braille, or some other method that will best accommodate the
Requester's disability, if any);
(6) Any other information that may be helpful to CGB and the manufacturer or
service provider to understand the nature of the dispute;
(7) Description of any contacts with the manufacturer or service provider to resolve
the dispute, including, but not limited to, dates or approximate dates, any offers
to settle, etc.; and
(8) What the Requester is seeking to resolve the dispute.
(c) CGB shall forward the Request for Dispute Assistance to the manufacturer or service
provider named in the Request. CGB shall serve the manufacturer or service provider
using the contact details of the certification to be filed pursuant to 14.31(b). Service
using contact details provided pursuant to 14.31(b) is deemed served. Failure by a
manufacturer or service provider to file or keep the contact information current will not
be a defense of lack of service.
(d) CGB will assist the Requester and the manufacturer or service provider in reaching a
settlement of the dispute.
(e) Thirty days after the Request for Dispute Assistance was filed, if a settlement has not
been reached between the Requester and the manufacturer or service provider, the
Requester may file an informal complaint with the Commission,;
(f) When a Requester files an informal complaint with the Enforcement Bureau, as
provided in 14.34, the Commission will deem the CGB dispute assistance process
closed and the requester and manufacturer or service provider shall be barred from
further use of the Commission's dispute assistance process so long as a complaint is
pending.
14.33 Informal or formal complaints.
Complaints against manufacturers or service providers, as defined under this subpart, for
alleged violations of this subpart may be either informal or formal.
14.34 Informal complaints; form, filing, content, and consumer assistance.
14

Federal Communications Commission

FCC 11-151

(a) An informal complaint alleging a violation of Section 255, 716 or 718 of the Act or
parts 6, 7, or this part may be transmitted to the Enforcement Bureau by any reasonable
means, including the Commission's online informal complaint filing system, U.S. Mail,
overnight delivery, or e-mail. Any Requests filed using a method other than the
Commission's online system should include a cover letter that references Section 255, 716,
or 718 or the rules of parts 6, 7, or this part and should be addressed to the Enforcement
Bureau.
(b) An informal complaint shall include:
(1) The name, address, e-mail address, and telephone number of the complainant;
(2) The name, address, and telephone number of the manufacturer or service
provider defendant against whom the complaint is made;
(3) The date or dates on which the complainant or person(s) on whose behalf the
complaint is being filed either purchased, acquired, or used or attempted to
purchase, acquire, or use the equipment or service about which the complaint is
being made;
(4) A complete statement of fact explaining why the complainant contends that the
defendant manufacturer or provider is in violation of Section 255, 716 or 718 of
the Act or the Commission's rules, including details regarding the service or
equipment and the relief requested, and all documentation that supports the
complainant's contention;
(5) A certification that the complainant submitted to the Commission a Request for
Dispute Assistance, pursuant to 14.32, no less than 30 days before the
complaint is filed;
(6) The complainant's preferred format or method of response to the complaint by
the Commission and defendant (e.g., letter, facsimile transmissions, telephone
(voice/TRS/TTY), e-mail, audio-cassette recording, Braille, or some other
method that will best accommodate the complainant's disability, if any); and
(7) Any other information that is required by the Commission's accessibility
complaint form.
(c) Any party with a question about information that should be included in an Informal
Complaint should e-mail the Commission's Disability Rights Office at dro@fcc.gov or call
202-418-2517 (voice), 202-418-2922 (TTY).
14.35 Procedure; designation of agents for service.
(a)
The Commission shall forward any informal complaint meeting the requirements of
14.34 of this subpart to each manufacturer and service provider named in or determined
by the staff to be implicated by the complaint.
(b)
To ensure prompt and effective service of informal and formal complaints filed under
this subpart, every manufacturer and service provider subject to the requirements of
Section 255, 716, or 718 of the Act and parts 6, 7, or this part, shall designate an agent,
15

Federal Communications Commission

FCC 11-151

and may designate additional agents if it so chooses, upon whom service may be made
of all notices, inquiries, orders, decisions, and other pronouncements of the
Commission in any matter before the Commission. The agent shall be designated in the
manufacturer or service provider's annual certification pursuant to 14.31.
14.36 Answers and replies to informal complaints.
(a) After a complainant makes a prima facie case by asserting that a product or service is
not accessible, the manufacturer or service provider to whom the informal complaint is directed
bears the burden of proving that the product or service is accessible or, if not accessible, that
accessibility is not achievable under this part or readily achievable under parts 6 and 7. To carry
its burden of proof, a manufacturer or service provider must produce documents demonstrating
its due diligence in exploring accessibility and achievability, as required by parts 6, 7, or this
part, throughout the design, development, testing, and deployment stages of a product or service.
Conclusory and unsupported claims are insufficient to carry this burden of proof.
(b) Any manufacturer or service provider to whom an informal complaint is served by the
Commission under this subpart shall file and serve an answer responsive to the complaint and
any inquires set forth by the Commission.
(1)
The answer shall:
(i)
Be filed with the Commission within twenty days of service of the complaint,
unless the Commission or its staff specifies another time period;
(ii) Respond specifically to each material allegation in the complaint and assert any
defenses
that the manufacturer or service provider claim;
(iii) Include a declaration by an officer of the manufacturer or service provider
attesting to the
truth of the facts asserted in the answer;
(iv) Set forth any remedial actions already taken or proposed alternative relief without
any
prejudice to any denials or defenses raised;
(v)
Provide any other information or materials specified by the Commission as
relevant to its
consideration of the complaint; and
(vi) Be prepared or formatted, including in electronic readable format compatible with
the
Commission's Summation or other software in the manner requested by
the Commission
and the
complainant, unless otherwise permitted by
the Commission for good cause
shown.
(2)
If the manufacturer's or service provider's answer includes the defense that it was
not
achievable for the manufacturer or service provider to make its product or
service
accessible, the manufacturer or service provider shall carry the burden of
proof on the
defense and the answer shall:
(i)
Set forth the steps taken by the manufacturer or service provider to make the
product or service accessible and usable;
(ii) Set forth the procedures and processes used by the manufacturer or service
provider to evaluate whether it was achievable to make the product or service
accessible and usable in cases where the manufacturer or service provider alleges
it was not achievable to do so;
16

Federal Communications Commission

FCC 11-151

(iii) Set forth the manufacturer's basis for determining that it was not achievable to
make the product or service accessible and usable in cases where the
manufacturer or service provider so alleges; and
(iv) Provide all documents supporting the manufacturer's or service provider's
conclusion
that it was not achievable to make the product or service accessible
and usable in cases
where the manufacturer or service provider so alleges.
(c)
Any manufacturer or service provider to whom an informal complaint is served by the
Commission under this subpart shall serve the complainant and the Commission with a non-
confidential summary of the answer filed with the Commission within twenty days of service of
the complaint. The non-confidential summary must contain the essential elements of the answer,
including, but not limited to, any asserted defenses to the complaint, must address the material
elements of its answer, and include sufficient information to allow the complainant to file a
reply, if the complainant chooses to do so.
(d)
The complainant may file and serve a reply. The reply shall:
(1)
Be served on the Commission and the manufacturer or service provider that is
subject of the complaint within ten days after service of answer, unless otherwise
directed by the Commission;
(2)
Be responsive to matters contained in the answer and shall not contain new
matters.
14.37 Review and disposition of informal complaints.
(a) The Commission will investigate the allegations in any informal complaint filed that
satisfies the requirements of section 14.34(b) of this subpart, and, within 180 days after
the date on which such complaint was filed with the Commission, issue an order
finding whether the manufacturer or service provider that is the subject of the
complaint violated Section 255, 716, or 718 of the Act, or the Commission's
implementing rules, and provide a basis therefore, unless such complaint is resolved
before that time.
(b) If the Commission determines in an order issued pursuant to paragraph (a) that the
manufacturer or service provider violated Section 255, 716, or 718 of the Act, or the
Commission's implementing rules, the Commission may, in such order, or in a
subsequent order:
(1) Direct the manufacturer or service provider to bring the service, or in the case of
a manufacturer, the next generation of the equipment or device, into compliance
with the requirements of Section 255, 716, or 718 of the Act, and the
Commission's rules, within a reasonable period of time; and
(2) Take such other enforcement action as the Commission is authorized and as it
deems appropriate.
17

Federal Communications Commission

FCC 11-151

(c) Any manufacturer or service provider that is the subject of an order issued pursuant to
paragraph (b)(1) shall have a reasonable opportunity, as established by the
Commission, to comment on the Commission's proposed remedial action before the
Commission issues a final order with respect to that action.
14.38 Formal Complaints; General pleading requirements.
Formal complaint proceedings are generally resolved on a written record consisting of a
complaint, answer, and joint statement of stipulated facts, disputed facts and key legal issues,
along with all associated affidavits, exhibits and other attachments. Commission proceedings
may also require or permit other written submissions such as briefs, written interrogatories, and
other supplementary documents or pleadings.
(a) Pleadings must be clear, concise, and explicit. All matters concerning a claim, defense or
requested remedy, including damages, should be pleaded fully and with specificity.
(b) Pleadings must contain facts which, if true, are sufficient to constitute a violation of the Act
or Commission order or regulation, or a defense to such alleged violation.
(c) Facts must be supported by relevant documentation or affidavit.
(d) Legal arguments must be supported by appropriate judicial, Commission, or statutory
authority.
(e) Opposing authorities must be distinguished.
(f) Copies must be provided of all non-Commission authorities relied upon which are not
routinely available in national reporting systems, such as unpublished decisions or slip
opinions of courts or administrative agencies.
(g) Parties are responsible for the continuing accuracy and completeness of all information and
supporting authority furnished in a pending complaint proceeding. Information submitted, as
well as relevant legal authorities, must be current and updated as necessary and in a timely
manner at any time before a decision is rendered on the merits of the complaint.
(h) All statements purporting to summarize or explain Commission orders or policies must cite,
in standard legal form, the Commission ruling upon which such statements are based.
(i) Pleadings shall identify the name, address, telephone number, and facsimile transmission
number for either the filing party's attorney or, where a party is not represented by an attorney,
the filing party.
14.39
Format and content of formal complaints.
(a) Subject to paragraph (d) of this section governing supplemental complaints filed pursuant to
14.39 of this subpart, a formal complaint shall contain:
18

Federal Communications Commission

FCC 11-151

(1) The name of each complainant and defendant;
(2) The occupation, address and telephone number of each complainant and, to the extent
known, each defendant;
(3) The name, address, and telephone number of complainant's attorney, if represented by
counsel;
(4) Citation to the section of the Communications Act and/or order and/or regulation of the
Commission alleged to have been violated.
(5) A complete statement of facts which, if proven true, would constitute such a violation. All
material facts must be supported, pursuant to the requirements of 14.38(c) of this subpart
and paragraph (a)(11) of this section, by relevant affidavits and documentation, including
copies of relevant written agreements, offers, counter-offers, denials, or other related
correspondence. The statement of facts shall include a detailed explanation of the manner and
time period in which a defendant has allegedly violated the Act, Commission order, or
Commission rule in question, including a full identification or description of the
communications, transmissions, services, or other carrier conduct complained of and the
nature of any injury allegedly sustained by the complainant. Assertions based on information
and belief are expressly prohibited unless made in good faith and accompanied by an
affidavit explaining the basis for the plaintiff's belief and why the complainant could not
reasonably ascertain the facts from the defendant or any other source;
(6) Proposed findings of fact, conclusions of law, and legal analysis relevant to the claims
and arguments set forth in the complaint;
(7) The relief sought, including recovery of damages and the amount of damages claimed, if
known;
(8) Certification that the complainant has, in good faith, discussed or attempted to discuss the
possibility of settlement with each defendant prior to the filing of the formal complaint. Such
certification shall include a statement that, prior to the filing of the complaint, the
complainant mailed a certified letter outlining the allegations that form the basis of the
complaint it anticipated filing with the Commission to the defendant carrier or one of the
defendant's registered agents for service of process that invited a response within a
reasonable period of time and a brief summary of all additional steps taken to resolve the
dispute prior to the filing of the formal complaint. If no additional steps were taken, such
certificate shall state the reason(s) why the complainant believed such steps would be
fruitless;
(9) Whether a separate action has been filed with the Commission, any court, or other
government agency that is based on the same claim or same set of facts, in whole or in part,
or whether the complaint seeks prospective relief identical to the relief proposed or at issue in
a notice-and-comment proceeding that is concurrently before the Commission;
(10) An information designation containing:
19

Federal Communications Commission

FCC 11-151

(i) The name, address, and position of each individual believed to have firsthand knowledge
of the facts alleged with particularity in the complaint, along with a description of the facts
within any such individual's knowledge;
(ii) A description of all documents, data compilations and tangible things in the
complainant's possession, custody, or control, that are relevant to the facts alleged with
particularity in the complaint. Such description shall include for each document:
(A) The date it was prepared, mailed, transmitted, or otherwise disseminated;
(B) The author, preparer, or other source;
(C) The recipient(s) or intended recipient(s);
(D) Its physical location; and
(E) A description of its relevance to the matters contained in the complaint; and
(iii) A complete description of the manner in which the complainant identified all persons
with information and designated all documents, data compilations and tangible things as
being relevant to the dispute, including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such persons, documents,
data compilations, tangible things, and information;
(11) Copies of all affidavits, documents, data compilations and tangible things in the
complainant's possession, custody, or control, upon which the complainant relies or intends
to rely to support the facts alleged and legal arguments made in the complaint;
(12) A completed Formal Complaint Intake Form;
(13) A declaration, under penalty of perjury, by the complainant or complainant's counsel
describing the amount, method, and the complainant's 10-digit FCC Registration Number, if
any;
(14) A certificate of service; and
(15) A FCC Registration Number is required under part 1, subpart W. Submission of a
complaint without the FCC Registration Number as required by part 1, subpart W will result
in dismissal of the complaint.
(b) The following format may be used in cases to which it is applicable, with such
modifications as the circumstances may render necessary:
Before the Federal Communications Commission, Washington, DC 20554
In the matter of
20

Federal Communications Commission

FCC 11-151

Complainant,
v.
Defendant.
File No. (To be inserted by the Enforcement Bureau)
Complaint
To: The Commission.
The complainant (here insert full name of each complainant and, if a corporation, the corporate
title of such complainant) shows that:
1. (Here state post office address, and telephone number of each complainant).
2. (Here insert the name, and, to the extent known, address and telephone number of
defendants).
3. (Here insert fully and clearly the specific act or thing complained of, together with such facts
as are necessary to give a full understanding of the matter, including relevant legal and
documentary support).
Wherefore, complainant asks (here state specifically the relief desired).
(Date)
(Name of each complainant)
(Name, address, and telephone number of attorney, if any)
(c) The complainant may petition the staff, pursuant to 1.3, for a waiver of any of the
requirements of this section. Such waiver may be granted for good cause shown.
(d) Supplemental complaints.
(1) Supplemental complaints filed pursuant to 14.39 shall conform to the requirements set
out in this section and 14.38 of this subpart, except that the requirements in 14.38(b),
14.39 (a)(4), (a)(5), (a)(8), (a)(9), (a)(12), and (a)(13) of this subpart shall not apply to such
supplemental complaints;
(2) In addition, supplemental complaints filed pursuant to 14.39 of this subpart shall
contain a complete statement of facts which, if proven true, would support complainant's
calculation of damages for each category of damages for which recovery is sought. All
material facts must be supported, pursuant to the requirements of 14.38(c) of this subpart
and paragraph (a)(11) of this section, by relevant affidavits and other documentation. The
statement of facts shall include a detailed explanation of the matters relied upon, including a
21

Federal Communications Commission

FCC 11-151

full identification or description of the communications, transmissions, services, or other
matters relevant to the calculation of damages and the nature of any injury allegedly
sustained by the complainant. Assertions based on information and belief are expressly
prohibited unless made in good faith and accompanied by an affidavit explaining the basis
for the complainant's belief and why the complainant could not reasonably ascertain the facts
from the defendant or any other source;
(3) Supplemental complaints filed pursuant to 14.39 of this subpart shall contain a
certification that the complainant has, in good faith, discussed or attempted to discuss the
possibility of settlement with respect to damages for which recovery is sought with each
defendant prior to the filing of the supplemental complaint. Such certification shall include a
statement that, no later than 30 days after the release of the liability order, the complainant
mailed a certified letter to the primary individual who represented the defendant carrier
during the initial complaint proceeding outlining the allegations that form the basis of the
supplemental complaint it anticipates filing with the Commission and inviting a response
from the carrier within a reasonable period of time. The certification shall also contain a brief
summary of all additional steps taken to resolve the dispute prior to the filing of the
supplemental complaint. If no additional steps were taken, such certification shall state the
reason(s) why the complainant believed such steps would be fruitless.
14.40 Damages.
(a) A complaint against a common carrier may seek damages. If a complainant wishes to
recover damages, the complaint must contain a clear and unequivocal request for damages.
(b) If a complainant wishes a determination of damages to be made in the same proceeding as
the determinations of liability and prospective relief, the complaint must contain the allegations
and information required by paragraph (h) of this section.
(c) Notwithstanding paragraph (b) of this section, in any proceeding to which no statutory
deadline applies, if the Commission decides that a determination of damages would best be
made in a proceeding that is separate from and subsequent to the proceeding in which the
determinations of liability and prospective relief are made, the Commission may at any time
order that the initial proceeding will determine only liability and prospective relief, and that a
separate, subsequent proceeding initiated in accordance with paragraph (e) of this section will
determine damages.
(d) If a complainant wishes a determination of damages to be made in a proceeding that is
separate from and subsequent to the proceeding in which the determinations of liability and
prospective relief are made, the complainant must:
(1) Comply with paragraph (a) of this section, and
(2) State clearly and unequivocally that the complainant wishes a determination of damages
to be made in a proceeding that is separate from and subsequent to the proceeding in which
the determinations of liability and prospective relief will be made.
22

Federal Communications Commission

FCC 11-151

(e) If a complainant proceeds pursuant to paragraph (d) of this section, or if the Commission
invokes its authority under paragraph (c) of this section, the complainant may initiate a
separate proceeding to obtain a determination of damages by filing a supplemental complaint
that complies with 14.39(d) of this subpart and paragraph (h) of this section within sixty days
after public notice (as defined in 1.4(b) of this chapter) of a decision that contains a finding
of liability on the merits of the original complaint.
(f) If a complainant files a supplemental complaint for damages in accordance with paragraph
(e) of this section, the supplemental complaint shall be deemed, for statutory limitations
purposes, to relate back to the date of the original complaint.
(g) Where a complainant chooses to seek the recovery of damages upon a supplemental
complaint in accordance with the requirements of paragraph (e) of this section, the
Commission will resolve the separate, preceding liability complaint within any applicable
complaint resolution deadlines contained in the Act.
(h) In all cases in which recovery of damages is sought, it shall be the responsibility of the
complainant to include, within either the complaint or supplemental complaint for damages
filed in accordance with paragraph (e) of this section, either:
(1) A computation of each and every category of damages for which recovery is sought,
along with an identification of all relevant documents and materials or such other evidence to
be used by the complainant to determine the amount of such damages; or
(2) An explanation of:
(i) The information not in the possession of the complaining party that is necessary to
develop a detailed computation of damages;
(ii) Why such information is unavailable to the complaining party;
(iii) The factual basis the complainant has for believing that such evidence of damages exists;
(iv) A detailed outline of the methodology that would be used to create a computation of
damages with such evidence.
(i) Where a complainant files a supplemental complaint for damages in accordance with
paragraph (e) of this section, the following procedures may apply:
(1) Issues concerning the amount, if any, of damages may be either designated by the
Enforcement Bureau for hearing before, or, if the parties agree, submitted for mediation to, a
Commission Administrative Law Judge. Such Administrative Law Judge shall be chosen in
the following manner:
(i) By agreement of the parties and the Chief Administrative Law Judge; or
(ii) In the absence of such agreement, the Chief Administrative Law Judge shall designate the
Administrative Law Judge.
23

Federal Communications Commission

FCC 11-151

(2) The Commission may, in its discretion, order the defendant either to post a bond for, or
deposit into an interest bearing escrow account, a sum equal to the amount of damages which
the Commission finds, upon preliminary investigation, is likely to be ordered after the issue
of damages is fully litigated, or some lesser sum which may be appropriate, provided the
Commission finds that the grant of this relief is favored on balance upon consideration of the
following factors:
(i) The complainant's potential irreparable injury in the absence of such deposit;
(ii) The extent to which damages can be accurately calculated;
(iii) The balance of the hardships between the complainant and the defendant; and
(iv) Whether public interest considerations favor the posting of the bond or ordering of the
deposit.
(3) The Commission may, in its discretion, suspend ongoing damages proceedings for
fourteen days, to provide the parties with a time within which to pursue settlement
negotiations and/or alternative dispute resolution procedures.
(4) The Commission may, in its discretion, end adjudication of damages with a determination
of the sufficiency of a damages computation method or formula. No such method or formula
shall contain a provision to offset any claim of the defendant against the complainant. The
parties shall negotiate in good faith to reach an agreement on the exact amount of damages
pursuant to the Commission-mandated method or formula. Within thirty days of the release
date of the damages order, parties shall submit jointly to the Commission either:
(i) A statement detailing the parties' agreement as to the amount of damages;
(ii) A statement that the parties are continuing to negotiate in good faith and a request that the
parties be given an extension of time to continue negotiations; or
(iii) A statement detailing the bases for the continuing dispute and the reasons why no
agreement can be reached.
(j) Except where otherwise indicated, the rules governing initial formal complaint proceedings
govern supplemental formal complaint proceedings, as well.
14.41 Joinder of complainants and causes of action.
(a) Two or more complainants may join in one complaint if their respective causes of action
are against the same defendant and concern substantially the same facts and alleged violation
of the Communications Act.
(b) Two or more grounds of complaint involving the same principle, subject, or statement of
facts may be included in one complaint, but should be separately stated and numbered.
24

Federal Communications Commission

FCC 11-151

14.42 Answers.
(a) Any defendant upon whom copy of a formal complaint is served shall answer such
complaint in the manner prescribed under this section within twenty days of service of the
formal complaint by the complainant, unless otherwise directed by the Commission.
(b) The answer shall advise the complainant and the Commission fully and completely of the
nature of any defense, and shall respond specifically to all material allegations of the
complaint. Every effort shall be made to narrow the issues in the answer. The defendant shall
state concisely its defense to each claim asserted, admit or deny the averments on which the
complainant relies, and state in detail the basis for admitting or denying such averment.
General denials are prohibited. Denials based on information and belief are expressly
prohibited unless made in good faith and accompanied by an affidavit explaining the basis for
the defendant's belief and why the defendant could not reasonably ascertain the facts from the
complainant or any other source. If the defendant is without knowledge or information
sufficient to form a belief as to the truth of an averment, the defendant shall so state and this
has the effect of a denial. When a defendant intends in good faith to deny only part of an
averment, the defendant shall specify so much of it as is true and shall deny only the
remainder. The defendant may deny the allegations of the complaint as specific denials of
either designated averments or paragraphs.
(c) The answer shall contain proposed findings of fact, conclusions of law, and legal analysis
relevant to the claims and arguments set forth in the answer.
(d) Averments in a complaint or supplemental complaint filed pursuant to 14.38 and 14.39
of this subpart are deemed to be admitted when not denied in the answer.
(e) Affirmative defenses to allegations contained in the complaint shall be specifically
captioned as such and presented separately from any denials made in accordance with
paragraph (c) of this section.
(f) The answer shall include an information designation containing:
(1) The name, address, and position of each individual believed to have firsthand knowledge
of the facts alleged with particularity in the answer, along with a description of the facts
within any such individual's knowledge;
(2) A description of all documents, data compilations and tangible things in the defendant's
possession, custody, or control, that are relevant to the facts alleged with particularity in the
answer. Such description shall include for each document:
(i) The date it was prepared, mailed, transmitted, or otherwise disseminated;
(ii) The author, preparer, or other source;
(iii) The recipient(s) or intended recipient(s);
25

Federal Communications Commission

FCC 11-151

(iv) Its physical location; and
(v) A description of its relevance to the matters in dispute.
(3) A complete description of the manner in which the defendant identified all persons with
information and designated all documents, data compilations and tangible things as being
relevant to the dispute, including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such persons, documents,
data compilations, tangible things, and information.
(g) The answer shall attach copies of all affidavits, documents, data compilations and tangible
things in the defendant's possession, custody, or control, upon which the defendant relies or
intends to rely to support the facts alleged and legal arguments made in the answer.
(h) The answer shall contain certification that the defendant has, in good faith, discussed or
attempted to discuss, the possibility of settlement with the complainant prior to the filing of the
formal complaint. Such certification shall include a brief summary of all steps taken to resolve
the dispute prior to the filing of the formal complaint. If no such steps were taken, such
certificate shall state the reason(s) why the defendant believed such steps would be fruitless;
(i) The defendant may petition the staff, pursuant to 1.3 of this chapter, for a waiver of any of
the requirements of this section. Such waiver may be granted for good cause shown.
14.43 Cross-complaints and counterclaims.
Cross-complaints seeking any relief within the jurisdiction of the Commission against any
party (complainant or defendant) to that proceeding are expressly prohibited. Any claim that
might otherwise meet the requirements of a cross-complaint may be filed as a separate
complaint in accordance with 14.38 through 14.40 of this subpart. For purposes of this
subpart, the term "cross-complaint" shall include counterclaims.
14.44 Replies.
(a) Within three days after service of an answer containing affirmative defenses presented in
accordance with the requirements of 14.42(e) of this subpart, a complainant may file and
serve a reply containing statements of relevant, material facts and legal arguments that shall be
responsive to only those specific factual allegations and legal arguments made by the defendant
in support of its affirmative defenses. Replies which contain other allegations or arguments
will not be accepted or considered by the Commission.
(b) Failure to reply to an affirmative defense shall be deemed an admission of such affirmative
defense and of any facts supporting such affirmative defense that are not specifically
contradicted in the complaint.
26

Federal Communications Commission

FCC 11-151

(c) The reply shall contain proposed findings of fact, conclusions of law, and legal analysis
relevant to the claims and arguments set forth in the reply.
(d) The reply shall include an information designation containing:
(1) The name, address and position of each individual believed to have firsthand knowledge
about the facts alleged with particularity in the reply, along with a description of the facts
within any such individual's knowledge.
(2) A description of all documents, data compilations and tangible things in the complainant's
possession, custody, or control that are relevant to the facts alleged with particularity in the
reply. Such description shall include for each document:
(i) The date prepared, mailed, transmitted, or otherwise disseminated;
(ii) The author, preparer, or other source;
(iii) The recipient(s) or intended recipient(s);
(iv) Its physical location; and
(v) A description of its relevance to the matters in dispute.
(3) A complete description of the manner in which the complainant identified all persons
with information and designated all documents, data compilations and tangible things as
being relevant to the dispute, including, but not limited to, identifying the individual(s) that
conducted the information search and the criteria used to identify such persons, documents,
data compilations, tangible things, and information;
(e) The reply shall attach copies of all affidavits, documents, data compilations and tangible
things in the complainant's possession, custody, or control upon which the complainant relies
or intends to rely to support the facts alleged and legal arguments made in the reply.
(f) The complainant may petition the staff, pursuant to 1.3 of this chapter, for a waiver of any
of the requirements of this section. Such waiver may be granted for good cause shown.
14.45 Motions.
(a) A request to the Commission for an order shall be by written motion, stating with
particularity the grounds and authority therefor, and setting forth the relief or order sought.
(b) All dispositive motions shall contain proposed findings of fact and conclusions of law, with
supporting legal analysis, relevant to the contents of the pleading. Motions to compel discovery
must contain a certification by the moving party that a good faith attempt to resolve the dispute
was made prior to filing the motion. All facts relied upon in motions must be supported by
documentation or affidavits pursuant to the requirements of 14.38(c) of this subpart, except
for those facts of which official notice may be taken.
27

Federal Communications Commission

FCC 11-151

(c) The moving party shall provide a proposed order for adoption, which appropriately
incorporates the basis therefor, including proposed findings of fact and conclusions of law
relevant to the pleading. The proposed order shall be clearly marked as a "Proposed Order."
The proposed order shall be submitted both as a hard copy and on computer disk in accordance
with the requirements of 14.51(d) of this subpart. Where appropriate, the proposed order
format should conform to that of a reported FCC order.
(d) Oppositions to any motion shall be accompanied by a proposed order for adoption, which
appropriately incorporates the basis therefor, including proposed findings of fact and
conclusions of law relevant to the pleading. The proposed order shall be clearly captioned as a
"Proposed Order." The proposed order shall be submitted both as a hard copy and on computer
disk in accordance with the requirements of 14.51(d) of this subpart. Where appropriate, the
proposed order format should conform to that of a reported FCC order.
(e) Oppositions to motions may be filed and served within five business days after the motion
is filed and served and not after. Oppositions shall be limited to the specific issues and
allegations contained in such motion; when a motion is incorporated in an answer to a
complaint, the opposition to such motion shall not address any issues presented in the answer
that are not also specifically raised in the motion. Failure to oppose any motion may constitute
grounds for granting of the motion.
(f) No reply may be filed to an opposition to a motion.
(g) Motions seeking an order that the allegations in the complaint be made more definite and
certain are prohibited.
(h) Amendments or supplements to complaints to add new claims or requests for relief are
prohibited. Parties are responsible, however, for the continuing accuracy and completeness of
all information and supporting authority furnished in a pending complaint proceeding as
required under 14.38(g) of this subpart.
14.46 Formal complaints not stating a cause of action; defective pleadings.
(a) Any document purporting to be a formal complaint which does not state a cause of action
under the Communications Act or a Commission rule or order will be dismissed. In such case,
any amendment or supplement to such document will be considered a new filing which must
be made within the statutory periods of limitations of actions contained in Section 415 of the
Communications Act.
(b) Any other pleading filed in a formal complaint proceeding not in conformity with the
requirements of the applicable rules in this part may be deemed defective. In such case the
Commission may strike the pleading or request that specified defects be corrected and that
proper pleadings be filed with the Commission and served on all parties within a prescribed
time as a condition to being made a part of the record in the proceeding.
14.47 Discovery.
28

Federal Communications Commission

FCC 11-151

(a) A complainant may file with the Commission and serve on a defendant, concurrently with
its complaint, a request for up to ten written interrogatories. A defendant may file with the
Commission and serve on a complainant, during the period starting with the service of the
complaint and ending with the service of its answer, a request for up to ten written
interrogatories. A complainant may file with the Commission and serve on a defendant, within
three calendar days of service of the defendant's answer, a request for up to five written
interrogatories. Subparts of any interrogatory will be counted as separate interrogatories for
purposes of compliance with this limit. Requests for interrogatories filed and served pursuant
to this procedure may be used to seek discovery of any non-privileged matter that is relevant to
the material facts in dispute in the pending proceeding, provided, however, that requests for
interrogatories filed and served by a complainant after service of the defendant's answer shall
be limited in scope to specific factual allegations made by the defendant in support of its
affirmative defenses. This procedure may not be employed for the purpose of delay,
harassment or obtaining information that is beyond the scope of permissible inquiry related to
the material facts in dispute in the pending proceeding.
(b) Requests for interrogatories filed and served pursuant to paragraph (a) of this section shall
contain a listing of the interrogatories requested and an explanation of why the information
sought in each interrogatory is both necessary to the resolution of the dispute and not available
from any other source.
(c) A responding party shall file with the Commission and serve on the propounding party any
opposition and objections to the requests for interrogatories as follows:
(1) By the defendant, within ten calendar days of service of the requests for interrogatories
served simultaneously with the complaint and within five calendar days of the requests for
interrogatories served following service of the answer;
(2) By the complainant, within five calendar days of service of the requests for
interrogatories; and
(3) In no event less than three calendar days prior to the initial status conference as provided
for in 14.50(a) of this subpart.
(d) Commission staff will consider the requests for interrogatories, properly filed and served
pursuant to paragraph (a) of this section, along with any objections or oppositions thereto,
properly filed and served pursuant to paragraph (b) of this section, at the initial status
conference, as provided for in 14.50(a)(5) of this subpart, and at that time determine the
interrogatories, if any, to which parties shall respond, and set the schedule of such response.
(e) The interrogatories ordered to be answered pursuant to paragraph (d) of this section are to
be answered separately and fully in writing under oath or affirmation by the party served, or if
such party is a public or private corporation or partnership or association, by any officer or
agent who shall furnish such information as is available to the party. The answers shall be
signed by the person making them. The answers shall be filed with the Commission and served
on the propounding party.
29

Federal Communications Commission

FCC 11-151

(f) A propounding party asserting that a responding party has provided an inadequate or
insufficient response to a Commission-ordered discovery request may file a motion to compel
within ten days of the service of such response, or as otherwise directed by Commission staff,
pursuant to the requirements of 14.45 of this subpart.
(g) The Commission may, in its discretion, require parties to provide documents to the
Commission in a scanned or other electronic format that provides:
(1) Indexing by useful identifying information about the documents; and
(2) Technology that allows staff to annotate the index so as to make the format an efficient
means of reviewing the documents.
(h) The Commission may allow additional discovery, including, but not limited to, document
production, depositions and/or additional interrogatories. In its discretion, the Commission may
modify the scope, means and scheduling of discovery in light of the needs of a particular case
and the requirements of applicable statutory deadlines.
14.48 Confidentiality of information produced or exchanged by the parties.
(a) Any materials generated in the course of a formal complaint proceeding may be designated
as proprietary by that party if the party believes in good faith that the materials fall within an
exemption to disclosure contained in the Freedom of Information Act (FOIA), 5 U.S.C.
552(b)(1) through (9). Any party asserting confidentiality for such materials shall so indicate
by clearly marking each page, or portion thereof, for which a proprietary designation is
claimed. If a proprietary designation is challenged, the party claiming confidentiality shall have
the burden of demonstrating, by a preponderance of the evidence, that the material designated
as proprietary falls under the standards for nondisclosure enunciated in the FOIA.
(b) Materials marked as proprietary may be disclosed solely to the following persons, only for
use in prosecuting or defending a party to the complaint action, and only to the extent
necessary to assist in the prosecution or defense of the case:
(1) Counsel of record representing the parties in the complaint action and any support
personnel employed by such attorneys;
(2) Officers or employees of the opposing party who are named by the opposing party as
being directly involved in the prosecution or defense of the case;
(3) Consultants or expert witnesses retained by the parties;
(4) The Commission and its staff; and
(5) Court reporters and stenographers in accordance with the terms and conditions of this
section.
30

Federal Communications Commission

FCC 11-151

(c) These individuals shall not disclose information designated as proprietary to any person
who is not authorized under this section to receive such information, and shall not use the
information in any activity or function other than the prosecution or defense in the case before
the Commission. Each individual who is provided access to the information shall sign a
notarized statement affirmatively stating that the individual has personally reviewed the
Commission's rules and understands the limitations they impose on the signing party.
(d) No copies of materials marked proprietary may be made except copies to be used by
persons designated in paragraph (b) of this section. Each party shall maintain a log recording
the number of copies made of all proprietary material and the persons to whom the copies have
been provided.
(e) Upon termination of a formal complaint proceeding, including all appeals and petitions, all
originals and reproductions of any proprietary materials, along with the log recording persons
who received copies of such materials, shall be provided to the producing party. In addition,
upon final termination of the complaint proceeding, any notes or other work product derived in
whole or in part from the proprietary materials of an opposing or third party shall be destroyed.
14.49 Other required written submissions.
(a) The Commission may, in its discretion, or upon a party's motion showing good cause,
require the parties to file briefs summarizing the facts and issues presented in the pleadings and
other record evidence.
(b) Unless otherwise directed by the Commission, all briefs shall include all legal and factual
claims and defenses previously set forth in the complaint, answer, or any other pleading
submitted in the proceeding. Claims and defenses previously made but not reflected in the
briefs will be deemed abandoned. The Commission may, in its discretion, limit the scope of
any briefs to certain subjects or issues. A party shall attach to its brief copies of all documents,
data compilations, tangible things, and affidavits upon which such party relies or intends to
rely to support the facts alleged and legal arguments made in its brief and such brief shall
contain a full explanation of how each attachment is relevant to the issues and matters in
dispute. All such attachments to a brief shall be documents, data compilations or tangible
things, or affidavits made by persons, that were identified by any party in its information
designations filed pursuant to 14.39(a)(10)(i), (a)(10)(ii), 14.27(f)(1), (f)(2), and
14.44(d)(1), (d)(2) of this subpart. Any other supporting documentation or affidavits that are
attached to a brief must be accompanied by a full explanation of the relevance of such
materials and why such materials were not identified in the information designations. These
briefs shall contain the proposed findings of fact and conclusions of law which the filing party
is urging the Commission to adopt, with specific citation to the record, and supporting relevant
authority and analysis.
(c) In cases in which discovery is not conducted, absent an order by the Commission that briefs
be filed, parties may not submit briefs. If the Commission does authorize the filing of briefs in
cases in which discovery is not conducted, briefs shall be filed concurrently by both the
complainant and defendant at such time as designated by the Commission staff and in
accordance with the provisions of this section.
31

Federal Communications Commission

FCC 11-151

(d) In cases in which discovery is conducted, briefs shall be filed concurrently by both the
complainant and defendant at such time designated by the Commission staff.
(e) Briefs containing information which is claimed by an opposing or third party to be
proprietary under 14.48 of this subpart shall be submitted to the Commission in confidence
pursuant to the requirements of 0.459 of this chapter and clearly marked "Not for Public
Inspection." An edited version removing all proprietary data shall also be filed with the
Commission for inclusion in the public file. Edited versions shall be filed within five days from
the date the unedited brief is submitted, and served on opposing parties.
(f) Initial briefs shall be no longer than twenty-five pages. Reply briefs shall be no longer than
ten pages. Either on its own motion or upon proper motion by a party, the Commission staff
may establish other page limits for briefs.
(g) The Commission may require the parties to submit any additional information it deems
appropriate for a full, fair, and expeditious resolution of the proceeding, including affidavits
and exhibits.
(h) The parties shall submit a joint statement of stipulated facts, disputed facts, and key legal
issues no later than two business days prior to the initial status conference, scheduled in
accordance with the provisions of 14.50(a) of this subpart.
14.50 Status conference.
(a) In any complaint proceeding, the Commission may, in its discretion, direct the attorneys
and/or the parties to appear before it for a status conference. Unless otherwise ordered by the
Commission, an initial status conference shall take place, at the time and place designated by
the Commission staff, ten business days after the date the answer is due to be filed. A status
conference may include discussion of:
(1) Simplification or narrowing of the issues;
(2) The necessity for or desirability of additional pleadings or evidentiary submissions;
(3) Obtaining admissions of fact or stipulations between the parties as to any or all of the
matters in controversy;
(4) Settlement of all or some of the matters in controversy by agreement of the parties;
(5) Whether discovery is necessary and, if so, the scope, type and schedule for such
discovery;
(6) The schedule for the remainder of the case and the dates for any further status
conferences; and
(7) Such other matters that may aid in the disposition of the complaint.
32

Federal Communications Commission

FCC 11-151

(b)(1) Parties shall meet and confer prior to the initial status conference to discuss:
(i) Settlement prospects;
(ii) Discovery;
(iii) Issues in dispute;
(iv) Schedules for pleadings;
(v) Joint statement of stipulated facts, disputed facts, and key legal issues; and
(2) Parties shall submit a joint statement of all proposals agreed to and disputes remaining as
a result of such meeting to Commission staff at least two business days prior to the scheduled
initial status conference.
(c) In addition to the initial status conference referenced in paragraph (a) of this section, any
party may also request that a conference be held at any time after the complaint has been filed.
(d) During a status conference, the Commission staff may issue oral rulings pertaining to a
variety of interlocutory matters relevant to the conduct of a formal complaint proceeding
including, inter alia, procedural matters, discovery, and the submission of briefs or other
evidentiary materials.
(e) Parties may make, upon written notice to the Commission and all attending parties at least
three business days prior to the status conference, an audio recording of the Commission staff's
summary of its oral rulings. Alternatively, upon agreement among all attending parties and
written notice to the Commission at least three business days prior to the status conference, the
parties may make an audio recording of, or use a stenographer to transcribe, the oral
presentations and exchanges between and among the participating parties, insofar as such
communications are "on-the-record" as determined by the Commission staff, as well as the
Commission staff's summary of its oral rulings. A complete transcript of any audio recording
or stenographic transcription shall be filed with the Commission as part of the record, pursuant
to the provisions of paragraph (f)(2) of this section. The parties shall make all necessary
arrangements for the use of a stenographer and the cost of transcription, absent agreement to
the contrary, will be shared equally by all parties that agree to make the record of the status
conference.
(f) The parties in attendance, unless otherwise directed, shall either:
(1) Submit a joint proposed order memorializing the oral rulings made during the conference
to the Commission by 5:30 pm, Eastern Time, on the business day following the date of the
status conference, or as otherwise directed by Commission staff. In the event the parties in
attendance cannot reach agreement as to the rulings that were made, the joint proposed order
shall include the rulings on which the parties agree, and each party's alternative proposed
rulings for those rulings on which they cannot agree. Commission staff will review and make
revisions, if necessary, prior to signing and filing the submission as part of the record. The
33

Federal Communications Commission

FCC 11-151

proposed order shall be submitted both as hard copy and on computer disk in accordance
with the requirements of 14.51(d) of this subpart; or
(2) Pursuant to the requirements of paragraph (e) of this section, submit to the Commission
by 5:30 pm., Eastern Time, on the third business day following the status conference or as
otherwise directed by Commission staff either:
(i) A transcript of the audio recording of the Commission staff's summary of its oral rulings;
(ii) A transcript of the audio recording of the oral presentations and exchanges between and
among the participating parties, insofar as such communications are "on-the-record" as
determined by the Commission staff, and the Commission staff's summary of its oral rulings;
or
(iii) A stenographic transcript of the oral presentations and exchanges between and among
the participating parties, insofar as such communications are "on-the-record" as determined
by the Commission staff, and the Commission staff's summary of its oral rulings.
(g) Status conferences will be scheduled by the Commission staff at such time and place as it
may designate to be conducted in person or by telephone conference call.
(h) The failure of any attorney or party, following reasonable notice, to appear at a scheduled
conference will be deemed a waiver by that party and will not preclude the Commission staff
from conferring with those parties and/or counsel present.
14.51 Specifications as to pleadings, briefs, and other documents; subscription.
(a) All papers filed in any formal complaint proceeding must be drawn in conformity with the
requirements of 1.49 and 1.50 of this chapter.
(b) All averments of claims or defenses in complaints and answers shall be made in numbered
paragraphs. The contents of each paragraph shall be limited as far as practicable to a statement
of a single set of circumstances. Each claim founded on a separate transaction or occurrence
and each affirmative defense shall be separately stated to facilitate the clear presentation of the
matters set forth.
(c) The original of all pleadings and other submissions filed by any party shall be signed by the
party, or by the party's attorney. The signing party shall include in the document his or her
address, telephone number, facsimile number and the date on which the document was signed.
Copies should be conformed to the original. Unless specifically required by rule or statute,
pleadings need not be verified. The signature of an attorney or party shall be a certificate that
the attorney or party has read the pleading, motion, or other paper; that to the best of his or her
knowledge, information, and belief formed after reasonable inquiry, it is well grounded in fact
and is warranted by existing law or a good faith argument for the extension, modification, or
reversal of existing law; and that it is not interposed solely for purposes of delay or for any
other improper purpose.
34

Federal Communications Commission

FCC 11-151

(d) All proposed orders shall be submitted both as hard copies and on computer disk formatted
to be compatible with the Commission's computer system and using the Commission's current
word processing software. Each disk should be submitted in "read only" mode. Each disk
should be clearly labeled with the party's name, proceeding, type of pleading, and date of
submission. Each disk should be accompanied by a cover letter. Parties who have submitted
copies of tariffs or reports with their hard copies need not include such tariffs or reports on the
disk. Upon showing of good cause, the Commission may waive the requirements of this
paragraph.
14.52 Copies; service; separate filings against multiple defendants.
(a) Complaints may generally be brought against only one named defendant; such actions may
not be brought against multiple defendants unless the defendants are commonly owned or
controlled, are alleged to have acted in concert, are alleged to be jointly liable to complainant,
or the complaint concerns common questions of law or fact. Complaints may, however, be
consolidated by the Commission for disposition.
(b) The complainant shall file an original copy of the complaint and, on the same day:
(1) File three copies of the complaint with the Office of the Commission Secretary;
(2) Serve two copies on the Enforcement Bureau;
and
(3) If a complaint is addressed against multiple defendants, file three copies of the complaint
with the Office of the Commission Secretary for each additional defendant.
(c) Generally, a separate file is set up for each defendant. An original plus two copies shall be
filed of all pleadings and documents, other than the complaint, for each file number assigned.
(d) The complainant shall serve the complaint by hand delivery on either the named defendant
or one of the named defendant's registered agents for service of process on the same date that
the complaint is filed with the Commission in accordance with the requirements of paragraph
(b) of this section.
(e) Upon receipt of the complaint by the Commission, the Commission shall promptly send, by
facsimile transmission to each defendant named in the complaint, notice of the filing of the
complaint. The Commission shall send, by regular U.S. mail delivery, to each defendant named
in the complaint, a copy of the complaint. The Commission shall additionally send, by regular
U.S. mail to all parties, a schedule detailing the date the answer will be due and the date, time
and location of the initial status conference.
(f) All subsequent pleadings and briefs filed in any formal complaint proceeding, as well as all
letters, documents or other written submissions, shall be served by the filing party on the
attorney of record for each party to the proceeding, or, where a party is not represented by an
attorney, each party to the proceeding either by hand delivery, overnight delivery, or by
35

Federal Communications Commission

FCC 11-151

facsimile transmission followed by regular U.S. mail delivery, together with a proof of such
service in accordance with the requirements of 1.47(g) of this chapter. Service is deemed
effective as follows:
(1) Service by hand delivery that is delivered to the office of the recipient by 5:30 pm, local
time of the recipient, on a business day will be deemed served that day. Service by hand
delivery that is delivered to the office of the recipient after 5:30 pm, local time of the
recipient, on a business day will be deemed served on the following business day;
(2) Service by overnight delivery will be deemed served the business day following the day it
is accepted for overnight delivery by a reputable overnight delivery service such as, or
comparable to, the US Postal Service Express Mail, United Parcel Service or Federal
Express; or
(3) Service by facsimile transmission that is fully transmitted to the office of the recipient by
5:30 pm, local time of the recipient, on a business day will be deemed served that day.
Service by facsimile transmission that is fully transmitted to the office of the recipient after
5:30 pm, local time of the recipient, on a business day will be deemed served on the
following business day.
(g) Supplemental complaint proceedings. Supplemental complaints filed pursuant to 14.39 of
this subpart shall conform to the requirements set out in this section, except that the
complainant need not submit a filing fee, and the complainant may effect service pursuant to
paragraph (f) of this section rather than paragraph (d) of this section numerals.
36

Federal Communications Commission

FCC 11-151

APPENDIX C

Proposed Rules

The Federal Communications Commission proposes to amend Part 14 of Title 47 of the

Code of Federal Regulations as follows:

Part 14 of Title 47 of the Code of Federal Regulations is amended as follows:

1.
The authority citation for Part 14 reads as follows:
AUTHORITY: 47 U.S.C. 151, 154(i), 154(j), 208, 255, 617, 618.
2.
The Federal Communications Commission proposes amending Part 14 by adding
new Subpart E.
*****

Subpart E Internet Browsers Built Into Telephones Used With Public Mobile
Services.

14.60 Internet Browsers built into Mobile Phones.
(a) Accessibility- If a manufacturer of a telephone used with public mobile services (as
such term is defined in Section 710(b)(4)(B) of the Act) includes an Internet browser in
such telephone, or if a provider of mobile service arranges for the inclusion of a browser
in telephones to sell to customers, the manufacturer or provider shall ensure that the
functions of the included browser (including the ability to launch the browser) are
accessible to and usable by individuals who are blind or have a visual impairment, unless
doing so is not achievable, except that this subpart shall not impose any requirement on
such manufacturer or provider--
(1) to make accessible or usable any Internet browser other than a browser that
such manufacturer or provider includes or arranges to include in the telephone; or
(2) to make Internet content, applications, or services accessible or usable (other
than enabling individuals with disabilities to use an included browser to access
such content, applications, or services).
(b) Industry Flexibility- A manufacturer or provider may satisfy the requirements of this
subpart with respect to such telephone or services by--
(1) ensuring that the telephone or services that such manufacture or provider
offers is accessible to and usable by individuals with disabilities without the use
of third party applications, peripheral devices, software, hardware, or customer
premises equipment; or

Federal Communications Commission

FCC 11-151

(2) using third party applications, peripheral devices, software, hardware, or
customer premises equipment that is available to the consumer at nominal cost
and that individuals with disabilities can access.
AUTHORITY: 47 U.S.C. 151, 154(i), 154(j), 208, 255, 617, 618, 619
1

Federal Communications Commission

FCC 11-151

APPENDIX D

Final Regulatory Flexibility Analysis

1. As required by the Regulatory Flexibility Act of 1980, as amended ("RFA"),1 an
Initial Regulatory Flexibility Analysis ("IRFA") was included in the Accessibility NPRM in CG
Docket No. 10-213, WT Docket No. 96-198, and CG Docket No. 10-145.2 The Commission
sought written public comment on the proposals in these dockets, including comment on the
IRFA. This Final Regulatory Flexibility Analysis ("FRFA") conforms to the RFA.3

B.

Need for, and Objectives of, the Report and Order

2.
The Report and Order implements Congress' mandate that people with
disabilities have access to advanced communications services ("ACS") and ACS equipment.
Specifically, these rules implement Sections 716 and 717 of the Communications Act of 1934, as
amended, which were added by the "Twenty-First Century Communications and Video
Accessibility Act of 2010" ("CVAA").4 Given the fundamental role ACS plays in today's
world, the Commission believes the CVAA represents the most significant legislation for people
with disabilities since the passage of the Americans with Disabilities Act of 1990 ("ADA").5
The inability to access communications equipment and services can be life-threatening in
emergency situations, can severely limit educational and employment opportunities, and can
otherwise interfere with full participation in business, family, social, and other activities.
3.
The Report and Order implements the requirements of Section 716 of the Act,
which requires providers of ACS and manufacturers of equipment used for ACS to make their
products accessible to people with disabilities, unless accessibility is not achievable.6 The
Commission also adopts rules to implement Section 717 of the Act, which requires the
Commission to establish new recordkeeping and enforcement procedures for manufacturers and
providers subject to Sections 255, 716 and 718.7
4.
The Report and Order applies to ACS, which includes interconnected VoIP, non-
interconnected VoIP, electronic messaging service, and interoperable video conferencing


1 See 5 U.S.C. 603. The RFA, see 5 U.S.C. 60112, has been amended by the Small Business Regulatory
Enforcement Fairness Act of 1996 (SBREFA), Pub. L. No. 104-121, Title II, 110 Stat. 857 (1996).
2 See Implementation of Sections 716 and 717 of the Communications Act of 1934, as Enacted by the Twenty-First
Century Communications and Video Accessibility Act of 2010; Amendments to the Commission's Rules
Implementing Sections 255 and 251(a)(2) of the Communications Act of 1934, as Enacted by the
Telecommunications Act of 1996; In the Matter of Accessible Mobile Phone Options for People who are Blind,
Deaf-Blind, or Have Low Vision
, Notice of Proposed Rulemaking, 26 FCC Rcd 3133, 3219 App.C (2010)
("Accessibility NPRM").
3 See 5 U.S.C. 604.
4 Pub. L. No. 111-260, 104.
5 Pub. L. No. 101-336, 104 Stat. 327 (1990) (codified at 42 U.S.C. 12101-12213).
6 See 47 U.S.C. 617.
7 See 47 U.S.C. 618.
2

Federal Communications Commission

FCC 11-151

service.8 The Report and Order requires manufacturers and service providers subject to Section
716 to comply with the requirements of Section 716 either by building accessibility features into
their equipment or service or by relying on third party applications or other accessibility
solutions. If accessibility is not achievable by building in accessibility or relying on third party
applications or other accessibility solutions, manufacturers and service providers must make their
products compatible with existing peripheral devices or specialized customer premises
equipment commonly used by individuals with disabilities to achieve access, unless that is not
achievable.
5.
The Report and Order holds entities that make or produce end user equipment,
including tablets, laptops, and smartphones, responsible for the accessibility of the hardware and
manufacturer-installed software used for e-mail, SMS text messaging, and other ACS. The
Report and Order also holds these entities responsible for software upgrades made available by
such manufacturers for download by users. Additionally, the Report and Order concludes that,
except for third party accessibility solutions, there is no liability for a manufacturer of end user
equipment for the accessibility of software that is installed or downloaded by a user or made
available for use in the cloud.
6.
The Report and Order requires manufacturers and service providers to consider
performance objectives at the design stage as early and consistently as possible and implement
such evaluation to the extent that it is achievable. The Report and Order incorporates into the
performance objectives the outcome-oriented definitions of "accessible," "compatibility," and
"usable" contained in the rules regarding the accessibility of telecommunications services and
equipment. The Report and Order adopts the four statutory factors to determine achievability.
The Report and Order further expands on the fourth achievability factor the extent to which an
offering has varied functions, features, and prices by allowing entities to not consider what is
achievable with respect to every product, if such entity offers consumers with the full range of
disabilities varied functions, features, and prices.
7.
The Report and Order also establishes processes for providers of ACS and ACS
equipment manufacturers to seek waivers of the Section 716 obligations, both individual and
class, for offerings which are designed for multiple purposes but are designed primarily for
purposes other than using ACS. The Report and Order clarifies what constitutes "customized
equipment or services" for purposes of an exclusion of the Section 716 requirements. Pointing to
an insufficient record upon which to grant a permanent exemption for small entities, the Report
and Order
also temporarily exempts all manufacturers of ACS equipment and all providers of
ACS from the obligations of Section 716 if they qualify as small business concerns under the
Small Business Administration's ("SBA") rules and size standards for the industry in which they
are primarily engaged.
8.
Specifically, the Report and Order adopted for this temporary exemption the
SBA's maximum size standards that are used to determine whether a business concern qualifies
as a small business concern in its primary industry.9 These size standards are based on the
maximum number of employees or maximum annual receipts of a business concern.10 The SBA


8 47 U.S.C. 153(53).
9 See 13 C.F.R. 121.201.
10 13 C.F.R. 121.106 (describing how number of employees is calculated); 13 C.F.R. 121.104 (describing how
annual receipts is calculated).
3

Federal Communications Commission

FCC 11-151

categorizes industries for its size standards using the North American Industry Classification
System ("NAICS"), a "system for classifying establishments by type of economic activity."11
The Report and Order identified some NAICS codes for possible primary industry classifications
of ACS equipment manufacturers and ACS providers and the relevant SBA size standards
associated with the codes.12

NAICS Classification13

NAICS Code

SBA Size Standard14

Wired Telecommunications Carriers
517110
1,500 or fewer
employees
Wireless Telecommunications Carriers
517210
1,500 or fewer
(except satellites)
employees
Telecommunications Resellers
517911
1,500 or fewer
15
employees
All Other Telecommunications
517919
$25 million or less in
annual receipts

Services

Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
Data Processing, Hosting, and Related
518210
$25 million or less in
Services
annual receipts
Radio and Television Broadcasting and
334220
750 or fewer
16
Wireless Communications Equipment
employees
Manufacturing
Electronic Computer Manufacturing
334111
1,000 or fewer
employees

Equipment

Telephone Apparatus Manufacturing
334210
1,000 or fewer
employees


11 North American Industry Classification System; Revision for 2012, 76 Fed. Reg. 51240 (Aug. 17, 2011) ("NAICS
Final Decision
").
12 This is not a comprehensive list of the primary industries and associated SBA size standards of every possible
manufacturer of ACS equipment or provider of ACS. This list is merely representative of some primary industries
in which entities that manufacture ACS equipment or provide ACS may be primarily engaged. It is ultimately up to
an entity seeking the temporary exemption to make a determination regarding their primary industry, and justify
such determination in any enforcement proceeding.
13 The definitions for each NAICS industry classification can be found by entering the six digit NAICS code in the
"2007 NAICS Search" function available at the NAICS homepage,
http://www.census.gov/eos/www/naics/index.html. The U.S. Office of Management and Budget has revised NAICS
for 2012, however, the codes and industry categories listed herein are unchanged. OMB anticipates releasing a 2012
NAICS UNITED STATES MANUAL or supplement in January 2012. See NAICS Final Decision, 76 Fed. Reg. at
51240.
14 See 13 C.F.R. 121.201 for a full listing of SBA size standards by six-digit NAICS industry code. The standards
listed in this column establish the maximum size an entity in the given NAICS industry may be to qualify as a small
business concern.
15 See accompanying Report and Order at Section III.A.
4

Federal Communications Commission

FCC 11-151

Other Communications Equipment
334290
750 or fewer
Manufacturing
employees
Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
9.
As stated above, the Report and Order indicated that this temporary exemption is
self-executing. Under this approach, covered entities must determine whether they qualify for
the exemption based upon their ability to meet the SBA's rules and the size standard for the
relevant NAICS industry category for the industry in which they are primarily engaged. Entities
that manufacture ACS equipment or provide ACS may raise this temporary exemption as a
defense in an enforcement proceeding. Entities claiming the exemption must be able to
demonstrate that they met the exemption criteria during the estimated start of the design phase of
the lifecycle of the product or service that is the subject of the complaint. The Report and Order
stated that if an entity no longer meets the exemption criteria, it must comply with Section 716
and Section 717 for all subsequent products or services or substantial upgrades of products or
services that are in the development phase of the product or service lifecycle, or any earlier
stages of development, at the time they no longer meet the criteria.
10.
The Report and Order indicated that such an exemption was necessary to avoid
the possibility of unreasonably burdening "small and entrepreneurial innovators and the
significant value that they add to the economy. The Report and Order states that the temporary
exemption enables us to provide relief to those entities that may possibly lack legal, financial, or
technical capability to comply with the Act until we further develop the record to determine
whether small entities should be subject to a permanent exemption and, if so, the criteria to be
used for defining which small entities should be subject to such permanent exemption. The
temporary exemption will begin on the effective date of the rules adopted in the Report and
Order
17 and will expire the earlier of the effective date of small entity exemption rules adopted
pursuant to the Further Notice of Proposed Rulemaking ("Further Notice") or October 8, 2013.
11.
The Commission establishes procedures in the Report and Order to facilitate the
filing of formal and informal complaints, including a discretionary pre-filing notice procedure to
facilitate dispute resolution: as a prerequisite to filing an informal complaint, complainants must
first file a "Request for Dispute Assistance" with the Consumer and Governmental Affairs
Bureau's Disability Rights Office. In addition, under the rules adopted in the Report and Order,
manufacturers and providers subject to Section 716 and Section 255 must maintain records of (1)
their efforts to consult with people with disabilities; (2) descriptions of the accessibility features
of their products and services; and (3) information about the compatibility of their products with
peripheral devices or specialized customer premises equipment commonly used by individuals
with disabilities to achieve access. The Report and Order also reminds covered entities that,
while the Commission does not require them to create and maintain any particular records to
claim a defense that it is not achievable for them to make their products or services accessible,
they bear the burden of proof on this defense.
(Continued from previous page)


16 See accompanying Report and Order at Section III.A.
17 See accompanying Report and Order at Section III.A.5.
5

Federal Communications Commission

FCC 11-151

C.

Summary of the Significant Issues Raised by the Public Comments in
Response to the IRFA and Summary of the Assessment of the Agency of
Such Issues

12.
In response to the Accessibility NPRM, one commenter addressed the proposed rules and
policies implicated in the IRFA. NTCA requests that the Commission adopt an exemption for small
entities from the obligations of Section 716 and the Commission's rules implementing Section 716 for
small telecommunications carriers as defined by the SBA.18 Alternatively, NTCA requests a waiver
process for small entities to seek and qualify for a waiver.19 NTCA argues that small telecommunications
companies "lack the size and resources to influence the design or features of equipment . . . . [and] the
purchasing power to enable them to buy equipment in bulk for a reduced price, or to compel sufficient
production to ensure that compliant equipment `trickles down' to smaller purchasers within a specific
timeframe."20
13.
As explained in the Report and Order, we lack a sufficient record upon which to base a
permanent exemption for small entities. However, we believe that some relief is necessary for entities
that may be unreasonably burdened by conducting an achievability analysis and complying with the
recordkeeping and certification requirements as necessary under the Act and in accordance with the
Report and Order. Therefore, we exercise our discretion under the Act to temporarily exempt from the
obligations of Section 716 providers of ACS and manufacturers of ACS equipment that qualify as small
business concerns under the applicable SBA rules and size standards, and seek further comment on
whether to exercise our authority to grant a permanent small entity exemption in the accompanying
Further Notice, and if so, what criteria we should apply for defining which small entities should be
subject to such permanent exemption. As such, the Report and Order extends temporary relief to all
small business concerns that would otherwise have to comply with the Act.

D.

Description and Estimate of the Number of Small Entities to Which the Rules Will
Apply

14.
The RFA directs agencies to provide a description of, and where feasible, an
estimate of the number of small entities that face possible significant economic impact by the
adoption of proposed rules.21 The RFA generally defines the term "small entity" as having the
same meaning as the terms "small business," "small organization," and "small governmental
jurisdiction."22 In addition, the term "small business" has the same meaning as the term "small
business concern" under the Small Business Act.23 A "small business concern" is one that (1) is
independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies
any additional criteria established by the SBA.24


18 NTCA Comments at 2.
19 NTCA Comments at 2.
20 NTCA Comments at 3.
21 5 U.S.C. 604(a)(3).
22 5 U.S.C. 601(6).
23 5 U.S.C. 601(3) (incorporating by reference the definition of "small business concern" in the Small Business
Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies "unless an
agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity
for public comment, establishes one or more definitions of such term which are appropriate to the activities of the
agency and publishes such definition(s) in the Federal Register." 5 U.S.C. 601(3).
2415 U.S.C. 632.
(continued....)
6

Federal Communications Commission

FCC 11-151

15.
To assist the Commission in analyzing the total number of small entities
potentially affected by the proposals in the Further Notice, we ask commenters to estimate the
number of small entities that may be affected. To assist in assessing the nature and number of
small entities that face possible significant economic impact by the proposals in the Further
Notice
, we seek comment on the industry categories below and our estimates of the entities in
each category that can, under relevant SBA standards or standards previously approved by the
SBA for small businesses, be classified as small. Where a commenter proposes an exemption
from the requirements of Section 716 and in effect Section 717, we also seek estimates from that
commenter on the number of small entities in each category that would be exempted from
compliance with Section 716 and in effect Section 717 under the proposed exemption, the
percentage of market share for the service or product that would be exempted, and the economic
impact, if any, on those entities that are not covered by the proposed exemption. While the
Further Notice and this IRFA seek comment on whether and how the Commission should
permanently exempt small entities from the requirements of Section 716 and in effect Section
717 for the purposes of building a record on that issue, we will assume, for the narrow purpose of
including a thorough regulatory impact analysis in this IRFA, that no such exemptions will be
provided.
16.
Many of the issues raised in the Further Notice relate to clarifying obligations on
entities already covered by the Report and Order, which may affect a broad range of service
providers and equipment manufacturers. The Further Notice seeks comment on making
permanent a temporary exemption for small entities that qualify as small business concerns
under the SBA's rules and small business size standards, or some other criteria. Therefore, it is
possible that all entities that would be required to comply with Section 716 and Section 717, but
are small business concerns or qualify as small entities under some other criteria, will be exempt
from the provisions of the proposed rules implementing Section 716 and Section 717. The
CVAA, however, does not provide the flexibility for the Commission to adopt an exemption for
small entities from compliance with Section 718. Therefore, we estimate below the impact on
small entities absent a permanent exemption from Section 716 and Section 717, and small
entities that may have to comply with Section 718. Specifically, we analyze the number of small
businesses engaged in manufacturing that may be affected by the Further Notice, absent a
permanent small entity exemption, including manufacturers of equipment used to provide
interconnected and non-interconnected VoIP, electronic messaging, and interoperable video
conferencing services. We then analyze the number of small businesses engaged as service
providers that may be affected by the Report and Order, absent a permanent small entity
exemption, including providers of interconnected and non-interconnected VoIP, electronic
messaging services, interoperable video conferencing services, wireless services, wireline
services, and other relevant services.
17.
Small Businesses, Small Organizations, and Small Governmental Jurisdictions.
Our action may, over time, affect small entities that are not easily categorized at present. We
therefore describe here, at the outset, three comprehensive, statutory small entity size standards.25
First, nationwide, there are a total of approximately 27.5 million small businesses, according to
(Continued from previous page)


25 See 5 U.S.C. 601(3)(6).
7

Federal Communications Commission

FCC 11-151

the SBA.26 In addition, a "small organization" is generally "any not-for-profit enterprise which
is independently owned and operated and is not dominant in its field."27 Nationwide, as of 2007,
there were approximately 1,621,315 small organizations.28 Finally, the term "small
governmental jurisdiction" is defined generally as "governments of cities, towns, townships,
villages, school districts, or special districts, with a population of less than fifty thousand."29
Census Bureau data for 2011 indicate that there were 89,476 local governmental jurisdictions in
the United States.30 We estimate that, of this total, as many as 88,506 entities may qualify as
"small governmental jurisdictions."31 Thus, we estimate that most governmental jurisdictions are
small.
1.

Equipment Manufacturers

a.

Manufacturers of Equipment to Provide VoIP

18.
Entities manufacturing equipment used to provide interconnected VoIP, non-
interconnected VoIP, or both are generally found in one of two Census Bureau categories,
"Electronic Computer Manufacturing"32 or "Telephone Apparatus Manufacturing."33 We include
here an analysis of the possible significant economic impact of our proposed rules on
manufacturers of equipment used to provide both interconnected and non-interconnected VoIP
because it is not possible to separate available data on these two manufacturing categories for
VoIP equipment. Our estimates below likely greatly overstate the number of small entities that
manufacture equipment used to provide ACS, including interconnected VoIP. However, in the
absence of more accurate data, we present these figures to provide as thorough an analysis of the
impact on small entities as possible.
19.
Electronic Computer Manufacturing. The Census Bureau defines this category to
include "establishments primarily engaged in manufacturing and/or assembling electronic


26 See SBA, Office of Advocacy, "Frequently Asked Questions," http://web.sba.gov/faqs (last visited May 6, 2011)
(figures are from 2009).
27 5 U.S.C. 601(4).
28 INDEPENDENT SECTOR, THE NEW NONPROFIT ALMANAC & DESK REFERENCE (2010).
29 5 U.S.C. 601(5).
30 U.S. CENSUS BUREAU, STATISTICAL ABSTRACT OF THE UNITED STATES: 2011, Table 427 (2007).
31 The 2007 U.S Census data for small governmental organizations are not presented based on the size of the
population in each such organization. There were 89,476 small governmental organizations in 2007. If we assume
that county, municipal, township and school district organizations are more likely than larger governmental
organizations to have populations of 50,000 or less, the total of these organizations is 52,125. If we make the same
assumption about special districts, and also assume that special districts are different from county, municipal,
township, and school districts, in 2007 there were 37,381 special districts. Therefore, of the 89,476 small
governmental organizations documented in 2007, as many as 89,506 may be considered small under the applicable
standard. This data may overestimate the number of such organizations that has a population of 50,000 or less. U.S.
CENSUS BUREAU, STATISTICAL ABSTRACT OF THE UNITED STATES 2011, Tables 427, 426 (data cited therein are
from 2007).
32 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
33 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
8

Federal Communications Commission

FCC 11-151

computers, such as mainframes, personal computers, workstations, laptops, and computer
servers. Computers can be analog, digital, or hybrid . . . The manufacture of computers includes
the assembly or integration of processors, coprocessors, memory, storage, and input/output
devices into a user-programmable final product."34
20.
In this category, the SBA deems and electronic computer manufacturing business
to be small if it has 1,000 employees or less.35 For this category of manufacturers, Census data
for 2007 show that there were 421 establishments that operated that year. Of those 421, 384 had
100 or fewer employees and 37 had 100 or more employees.36 On this basis, we estimate that the
majority of manufacturers of equipment used to provide electronic messaging services in this
category are small.
21.
Telephone Apparatus Manufacturing. The Census Bureau defines this category to
comprise "establishments primarily engaged in manufacturing wire telephone and data
communications equipment. These products may be standalone or board-level components of a
larger system. Examples of products made by these establishments are central office switching
equipment, cordless telephones (except cellular), PBX equipment, telephones, telephone
answering machines, LAN modems, multi-user modems, and other data communications
equipment, such as bridges, routers, and gateways."37
22.
In this category, the SBA deems a telephone apparatus manufacturing business to
be small if it has 1,000 or fewer employees.38 For this category of manufacturers, Census data
for 2007 shows there were 398 such establishments in operation.39 Of those 398 establishments,
393 (approximately 99%) had 1,000 or fewer employees and, thus, would be deemed small under
the applicable SBA size standard.40 On this basis, the Commission estimates that approximately
99% or more of the manufacturers of equipment used to provide VoIP in this category are small.
b.

Manufacturers of Equipment to Provide Electronic Messaging

23.
Entities that manufacture equipment (other than software) used to provide
electronic messaging services are generally found in one of three Census Bureau categories:
"Radio and Television Broadcasting and Wireless Communications Equipment
Manufacturing,"41 "Electronic Computer Manufacturing,"42 or "Telephone Apparatus
Manufacturing."43


34 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
35 13 C.F.R. 121.201, NAICS Code 334111.
36 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=300&;-
ds_name=EC0731I1&-_lang=en
37 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
38 13 C.F.R. 121.201, NAICS Code 334210.
39 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics by
Employment Size, NAICS code 334210 (rel. Nov. 16, 2010); http://factfinder.census.gov.
40 Id.
41 U.S. Census Bureau, 2007 NAICS Definitions, 334220 Radio and Television Broadcasting and Wireless
Communications Equipment, http://www.census.gov/econ/industry/def/d334220.htm.
9

Federal Communications Commission

FCC 11-151

24.
Radio and Television Broadcasting and Wireless Communications Equipment
Manufacturing. The Census Bureau defines this category as follows: "This industry comprises
establishments primarily engaged in manufacturing radio and television broadcast and wireless
communications equipment. Examples of products made by these establishments are:
transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular
phones, mobile communications equipment, and radio and television studio and broadcasting
equipment." The SBA has developed a small business size standard for Radio and Television
Broadcasting and Wireless Communications Equipment Manufacturing which is: all such firms
having 750 or fewer employees. According to Census Bureau data for 2007, there were a total of
919 establishments in this category that operated for part or all of the entire year. Of this total,
771 had less than 100 employees and 148 had more than 100 employees.44 Thus, under this size
standard, the majority of firms can be considered small.
25.
Electronic Computer Manufacturing. The Census Bureau defines this category to
include "establishments primarily engaged in manufacturing and/or assembling electronic
computers, such as mainframes, personal computers, workstations, laptops, and computer
servers. Computers can be analog, digital, or hybrid. . . . The manufacture of computers includes
the assembly or integration of processors, coprocessors, memory, storage, and input/output
devices into a user-programmable final product."45
26.
In this category the SBA deems an electronic computer manufacturing business to
be small if it has 1,000 or fewer employees.46 For this category of manufacturers, Census data
for 2007 show that there were 421 such establishments that operated that year. Of those 421
establishments, 384 had 1,000 or fewer employees. 47 On this basis, we estimate that the majority
of the manufacturers of equipment used to provide electronic messaging services in this category
are small.
27.
Telephone Apparatus Manufacturing. The Census Bureau defines this category to
comprise "establishments primarily engaged in manufacturing wire telephone and data
communications equipment. These products may be stand alone or board-level components of a
larger system. Examples of products made by these establishments are central office switching
equipment, cordless telephones (except cellular), PBX equipment, telephones, telephone
(Continued from previous page)


42 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
43 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
44 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=300&;-
ds_name=EC0731I1&-_lang=en.
45 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
46 13 C.F.R. 121.201, NAICS Code 334111.
47 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=300&;-
ds_name=EC0731I1&-_lang=en.
10

Federal Communications Commission

FCC 11-151

answering machines, LAN modems, multi-user modems, and other data communications
equipment, such as bridges, routers, and gateways."48
28.
In this category the SBA deems a telephone apparatus manufacturing business to
be small if it has 1,000 or fewer employees.49 For this category of manufacturers, Census data
for 2007 shows that there were 398 such establishments that operated that year.50 Of those 398
establishments, 393 (approximately 99%) had 1,000 or fewer employees and, thus, would be
deemed small under the applicable SBA size standard.51 On this basis, the Commission estimates
that approximately 99% or more of the manufacturers of equipment used to provide electronic
messaging services in this category are small.
c.

Manufacturers of Equipment Used to Provide Interoperable Video
Conferencing Services

29.
Entities that manufacture equipment used to provide interoperable and other video
conferencing services are generally found in the Census Bureau category: "Other
Communications Equipment Manufacturing." The Census Bureau defines this category to
include: "establishments primarily engaged in manufacturing communications equipment (except
telephone apparatus, and radio and television broadcast, and wireless communications
equipment)."52
30.
Other Communications Equipment Manufacturing. In this category, the SBA
deems a business manufacturing other communications equipment to be small if it has 750 or
fewer employees.53 For this category of manufacturers, Census data for 2007 show that there
were 452 establishments that operated that year. Of the 452 establishments 406 had fewer than
100 employees and 46 had more than 100 employees. Accordingly, the Commission estimates
that a substantial majority of the manufacturers of equipment used to provide interoperable and
other video-conferencing services are small.54
2.

Service Providers

a.

Providers of VoIP

31.
Entities that provide interconnected or non-interconnected VoIP or both are
generally found in one of two Census Bureau categories, "Wired Telecommunications Carriers"
or "All Other Telecommunications."


48 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
49 13 C.F.R. 121.201, NAICS Code 334210.
50 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics by
Employment Size, NAICS code 334111 (rel. Nov. 16, 2010); http://factfinder.census.gov.
51 Id.
52 U.S. Census Bureau, 2007 NAICS Definitions, 334290 Other communications equipment manufacturing,
http://www.census.gov/econ/industry/def/d334290.htm.
53 13 C.F.R. 121.201, NAICS Code 334220.
54 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=300&;-
ds_name=EC0731I1&-_lang=en.
11

Federal Communications Commission

FCC 11-151

32.
Wired Telecommunications Carriers. The Census Bureau defines this category as
follows: "This industry comprises establishments primarily engaged in operating and/or
providing access to transmission facilities and infrastructure that they own and/or lease for the
transmission of voice, data, text, sound, and video using wired telecommunications networks.
Transmission facilities may be based on a single technology or a combination of technologies.
Establishments in this industry use the wired telecommunications network facilities that they
operate to provide a variety of services, such as wired telephony services, including VoIP
services; wired (cable) audio and video programming distribution; and wired broadband Internet
services. By exception, establishments providing satellite television distribution services using
facilities and infrastructure that they operate are included in this industry."55
33.
In this category, the SBA deems a wired telecommunications carrier to be small if
it has 1,500 or fewer employees.56 Census data for 2007 shows 3,188 firms in this category57 Of
these 3,188 firms, only 44 had 1,000 or more employees. While we could not find precise
Census data on the number of firms with in the group with 1,500 or fewer employees, it is clear
that at least 3,144 firms with fewer than 1,000 employees would be in that group. On this basis,
the Commission estimates that a substantial majority of the providers of interconnected VoIP,
non-interconnected VoIP, or both in this category, are small.58
34.
All Other Telecommunications. Under the 2007 U.S. Census definition of firms
included in the category "All Other Telecommunications (NAICS Code 517919)"comprises
"establishments primarily engaged in providing specialized telecommunications services, such as
satellite tracking, communications telemetry, and radar station operation. This industry also
includes establishments primarily engaged in providing satellite terminal stations and associated
facilities connected with one or more terrestrial systems and capable of transmitting
telecommunications to, and receiving telecommunications from, satellite systems.
Establishments providing Internet services or voice over Internet protocol (VoIP) services via
client-supplied telecommunications connections are also included in this industry."59
35.
In this category, the SBA deems a provider of "all other telecommunications"
services to be small if it has $25 million or less in average annual receipts.60 For this category of
service providers, Census data for 2007 shows that there were 2,383 such firms that operated that


55 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers,
http://www.census.gov/econ/industry/def/d517110.htm.
56 13 C.F.R. 121.201, NAICS Code 517110.
57 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&;-
_lang=en.
58 Id. As noted in para. 18 above with regard to the distinction between manufacturers of equipment used to provide
interconnected VoIP and manufactures of equipment to provide non-interconnected VoIP, our estimates of the
number of the number of providers of non-interconnected VoIP (and the number of small entities within that group)
are likely overstated because we could not draw in the data a distinction between such providers and those that
provide interconnected VoIP. However, in the absence of more accurate data, we present these figures to provide as
thorough an analysis of the impact on small entities as we can at this time.
59 U.S. Census Bureau, 2007 NAICS Definitions, 517919 All Other Telecommunications,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517919&search=2007%20NAICS%20Search.
60 13 C.F.R. 121.201, NAICS Code 517919.
12

Federal Communications Commission

FCC 11-151

year.61 Of those 2,383 firms, 2,346 (approximately 98%) had $25 million or less in average
annual receipts and, thus, would be deemed small under the applicable SBA size standard. On
this basis, Commission estimates that approximately 98% or more of the providers of
interconnected VoIP, non-interconnected VoIP, or both in this category are small.62
b.

Providers of Electronic Messaging Services

36.
Entities that provide electronic messaging services are generally found in one of
the following Census Bureau categories, "Wireless Telecommunications Carriers (except
Satellites)," "Wired Telecommunications," or "Internet Publishing and Broadcasting and Web
Search Portals."
37.
Wireless Telecommunications Carriers (except Satellite). Since 2007, the Census
Bureau has placed wireless firms within this new, broad, economic census category.63 Prior to
that time, such firms were within the now-superseded categories of "Paging" and "Cellular and
Other Wireless Telecommunications."64 Under the present and prior categories, the SBA has
deemed a wireless business to be small if it has 1,500 or fewer employees.65 For the category of
Wireless Telecommunications Carriers (except Satellite), Census data for 2007 shows that there
were 1,383 firms that operated that year.66 Of those 1,383, 1,368 had fewer than 100 employees,
and 15 firms had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small. Similarly, according to
Commission data, 413 carriers reported that they were engaged in the provision of wireless
telephony, including cellular service, Personal Communications Service ("PCS"), and
Specialized Mobile Radio ("SMR") Telephony services.67 Of these, an estimated 261 have 1,500
or fewer employees and 152 have more than 1,500 employees.68 Consequently, the Commission
estimates that approximately half or more of these firms can be considered small. Thus, using
available data, we estimate that the majority of wireless firms can be considered small.


61 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
62 See discussion supra note 58, regarding possible overestimation of firms and small entities providing non-
interconnected VoIP services.
63 U.S. Census Bureau, 2007 NAICS Definitions, 517210 Wireless Telecommunications Carriers (Except Satellite),
http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
64 U.S. Census Bureau, 2002 NAICS Definitions, 517211 Paging,
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. Census Bureau, 2002 NAICS Definitions, "517212
Cellular and Other Wireless Telecommunications"; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
65 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R. citations were
13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
66 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
67 See Trends in Telephone Service, at tbl. 5.3.
68 Id.
13

Federal Communications Commission

FCC 11-151

38.
Wired Telecommunications Carriers. For the 2007 US Census definition of firms
included in the category, "Wired Telecommunications Carriers (NAICS Code 517110)," see
paragraph 32 above.
39.
In this category, the SBA deems a wired telecommunications carrier to be small if
it has 1,500 or fewer employees.69 Census data for 2007 shows 3,188 firms in this category.70 Of
these 3,188 firms, only 44 (approximately 1%) had 1,000 or more employees.71 While we could
not find precise Census data on the number of firms in the group with 1,500 or fewer employees,
it is clear that at least the 3,188 firms with fewer than 1,000 employees would be in that group.
Thus, at least 3,144 of these 3,188 firms (approximately 99%) had 1,500 or fewer employees.
On this basis, the Commission estimates that approximately 99% or more of the providers of
electronic messaging services in this category are small.
40.
Internet Publishing and Broadcasting and Web Search Portals. The Census
Bureau defines this category to include "establishments primarily engaged in 1) publishing
and/or broadcasting content on the Internet exclusively or 2) operating Web sites that use a
search engine to generate and maintain extensive databases of Internet addresses and content in
an easily searchable format (and known as Web search portals). The publishing and broadcasting
establishments in this industry do not provide traditional (non-Internet) versions of the content
that they publish or broadcast. They provide textual, audio, and/or video content of general or
specific interest on the Internet exclusively. Establishments known as Web search portals often
provide additional Internet services, such as e-mail, connections to other web sites, auctions,
news, and other limited content, and serve as a home base for Internet users."72
41.
In this category, the SBA deems an Internet publisher or Internet broadcaster or
the provider of a web search portal on the Internet to be small if it has 500 or fewer employees.73
For this category of manufacturers, Census data for 2007 shows that there were 2,705 such firms
that operated that year. 74 Of those 2,705 firms, 2,682 (approximately 99%) had 500 or fewer
employees and, thus, would be deemed small under the applicable SBA size standard.75 On this
basis, the Commission estimates that approximately 99% or more of the providers of electronic
messaging services in this category are small.
42.
Data Processing, Hosting, and Related Services. The Census Bureau defines this
category to include "establishments primarily engaged in providing infrastructure for hosting or
data processing services. These establishments may provide specialized hosting activities, such
as web hosting, streaming services or application hosting; provide application service


69 13 C.F.R. 121.201, NAICS Code 517110.
70 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics by
Employment Size, NAICS code 517110 (rel. Nov. 19, 2010); http://factfinder.census.gov.
71 Id.
72 U.S. Census Bureau, 2007 NAICS Definitions, 519130 Internet Publishing and Broadcasting and Web Search
Portals, http://www.naics.com/censusfiles/ND519130.HTM.
73 13 C.F.R. 121.201, NAICS Code 519130.
74 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics by
Employment Size, NAICS code 519130 (rel. Nov. 19, 2010); http://factfinder.census.gov.
75 Id.
14

Federal Communications Commission

FCC 11-151

provisioning; or may provide general time-share mainframe facilities to clients. Data processing
establishments provide complete processing and specialized reports from data supplied by clients
or provide automated data processing and data entry services."76
43.
In this category, the SBA deems a data processing, hosting, or related services
provider to be small if it has $25 million or less in annual receipts.77 For this category of
providers, Census data for 2007 shows that there were 14,193 such establishments that operated
that year.78 Of those 14,193 firms, 12,985 had less than $10 million in annual receipts, and 1,208
had greater than $10 million.79 Although no data is available to confirm the number of
establishments with greater than $25 million in receipts, the available data confirms the majority
of establishments in this category were small. On this basis, the Commission estimates that
approximately 96% of the providers of electronic messaging services in this category are small.
c.

Providers of Interoperable Video Conferencing Services

44.
Entities that provide interoperable video conferencing services are found in the
Census Bureau Category "All Other Telecommunications."
45.
All Other Telecommunications. For the 2007 US Census definition of firms
included in the category, "All Other Telecommunications (NAICS Code 517919)," see
paragraph 34 above.
46.
In this category, the SBA deems a provider of "all other telecommunications"
services to be small if it has $25 million or less in average annual receipts.80 Census data for
2007 show that there were 2,383 such firms that operated that year.81 Of those 2,383 firms,
2,346 (approximately 98%) had $25 million or less in average annual receipts and, thus, would
be deemed small under the applicable SBA size standard. On this basis, Commission estimates
that approximately 98% or more of the providers of interoperable video conferencing services
are small.
3.

Additional Industry Categories.

a.

Certain Wireless Carriers and Service Providers

47.
Cellular Licensees. The SBA has developed a small business size standard for
small businesses in the category "Wireless Telecommunications Carriers (except satellite)."82
Under that SBA category, a business is small if it has 1,500 or fewer employees.83 The census


76 U.S. Census Bureau, 2007 NAICS Definition, 518210 Data Processing, Hosting, and Related Services,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch.
77 13 C.F.R. 121.201; NAICS Code 518210.
78 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=800&;-
ds_name=EC0751SSSZ1&-_lang=en.
79 Id.
80 13 C.F.R. 121.201, NAICS Code 517919.
81 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
82 13 C.F.R. 121.201, North American Industry Classification System (NAICS) code 517210.
83 Id.
15

Federal Communications Commission

FCC 11-151

category of "Cellular and Other Wireless Telecommunications" is no longer used and has been
superseded by the larger category "Wireless Telecommunications Carriers (except satellite)."
The Census Bureau defines this larger category to include "establishments engaged in operating
and maintaining switching and transmission facilities to provide communications via the
airwaves. Establishments in this industry have spectrum licenses and provide services using that
spectrum, such as cellular phone services, paging services, wireless Internet access, and wireless
video services."84
48.
Census data for 2007 shows 1,383 firms in this category.85 Of these 1,383 firms,
only 15 (approximately 1%) had 1,000 or more employees.86 While there is no precise Census
data on the number of firms the group with 1,500 or fewer employees, it is clear that at least the
1,368 firms with fewer than 1,000 employees would be found in that group. Thus, at least 1,368
of these 1,383 firms (approximately 99%) 1,500 or fewer employees. On this basis, Commission
estimates that approximately 99% or more of the providers of electronic messaging services in
this category are small.
49.
Specialized Mobile Radio. The Commission awards "small entity" bidding credits
in auctions for Specialized Mobile Radio (SMR) geographic area licenses in the 800 MHz and
900 MHz bands to firms that had revenues of no more than $15 million in each of the three
previous calendar years.87 The Commission awards "very small entity" bidding credits to firms
that had revenues of no more than $3 million in each of the three previous calendar years.88 The
SBA has approved these small business size standards for the 900 MHz Service.89 The
Commission has held auctions for geographic area licenses in the 800 MHz and 900 MHz bands.
The 900 MHz SMR auction began on December 5, 1995, and closed on April 15, 1996. Sixty
bidders claiming that they qualified as small businesses under the $15 million size standard won
263 geographic area licenses in the 900 MHz SMR band. The 800 MHz SMR auction for the
upper 200 channels began on October 28, 1997, and was completed on December 8, 1997. Ten
bidders claiming that they qualified as small businesses under the $15 million size standard won
38 geographic area licenses for the upper 200 channels in the 800 MHz SMR band.90 A second
auction for the 800 MHz band was held on January 10, 2002 and closed on January 17, 2002 and
included 23 licenses. One bidder claiming small business status won five licenses.91


84 U.S. Census Bureau, 2007 NAICS Definitions, Wireless Telecommunications Carriers (Except Satellites)
http://www.census.gov/econ/industry/def/d517210.htm.
85 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics by
Employment Size, NAICS code 517210 (rel. Nov. 19, 2010); http://factfinder.census.gov.
86 Id.
87 47 C.F.R. 90.814(b)(1).
88 Id.
89 See Letter from Aida Alvarez, Administrator, Small Business Administration, to Thomas Sugrue, Chief, Wireless
Telecommunications Bureau, Federal Communications Commission, dated August 10, 1999.
90 See Correction to Public Notice DA 96-586, FCC Announces Winning Bidders in the Auction of 1020 Licenses to
Provide 900 MHz SMR in Major Trading Areas
, Public Notice, 18 FCC Rcd 18367 (WTB 1996).
91 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
16

Federal Communications Commission

FCC 11-151

50.
The auction of the 1,053 800 MHz SMR geographic area licenses for the General
Category channels began on August 16, 2000, and was completed on September 1, 2000. Eleven
bidders that won 108 geographic area licenses for the General Category channels in the 800 MHz
SMR band qualified as small businesses under the $15 million size standard. In an auction
completed on December 5, 2000, a total of 2,800 Economic Area licenses in the lower 80
channels of the 800 MHz SMR service were sold. Of the 22 winning bidders, 19 claimed "small
business" status and won 129 licenses. Thus, combining all three auctions, 40 winning bidders
for geographic licenses in the 800 MHz SMR band claimed status as small business.
51.
In addition, there are numerous incumbent site-by-site SMR licensees and
licensees with extended implementation authorizations in the 800 and 900 MHz bands. The
Commission does not know how many firms provide 800 MHz or 900 MHz geographic area
SMR services pursuant to extended implementation authorizations, nor how many of these
providers have annual revenues of no more than $15 million. One firm has over $15 million in
revenues. In addition, we do not know how many of these firms have 1,500 or fewer employees.
The Commission assumes, for purposes of this analysis, that all of the remaining existing
extended implementation authorizations are held by small entities.
52.
AWS Services (17101755 MHz and 21102155 MHz bands (AWS-1); 1915
1920 MHz, 19952000 MHz, 20202025 MHz and 21752180 MHz bands (AWS-2); 21552175
MHz band (AWS-3)).
For the AWS-1 bands, the Commission has defined a "small business" as
an entity with average annual gross revenues for the preceding three years not exceeding $40
million, and a "very small business" as an entity with average annual gross revenues for the
preceding three years not exceeding $15 million.92 In 2006, the Commission conducted its first
auction of AWS-1 licenses.93 In that initial AWS-1 auction, 31 winning bidders identified
themselves as very small businesses.94 Twenty-six of the winning bidders identified themselves
as small businesses.95 In a subsequent 2008 auction, the Commission offered 35 AWS-1
licenses.96 Four winning bidders identified themselves as very small businesses, and three of the
winning bidders identified themselves as a small business.97 For AWS-2 and AWS-3, although
we do not know for certain which entities are likely to apply for these frequencies, we note that
the AWS-1 bands are comparable to those used for cellular service and personal communications
service. The Commission has not yet adopted size standards for the AWS-2 or AWS-3 bands but


92 See Service Rules for Advanced Wireless Services in the 1.7 GHz and 2.1 GHz Bands, Report and Order, 18 FCC
Rcd 25,162, App. B (2003), modified by Service Rules for Advanced Wireless Services In the 1.7 GHz and 2.1 GHz
Bands, Order on Reconsideration, 20 FCC Rcd 14,058, App. C (2005).
93 See Auction of Advanced Wireless Services Licenses Scheduled for June 29, 2006; Notice and Filing
Requirements, Minimum Opening Bids, Upfront Payments and Other Procedures for Auction No. 66
, AU Docket
No. 06-30, Public Notice, 21 FCC Rcd 4562 (2006) ("Auction 66 Procedures Public Notice").
94 See Auction of Advanced Wireless Services Licenses Closes; Winning Bidders Announced for Auction No. 66,
Public Notice, 21 FCC Rcd 10,521 (2006) ("Auction 66 Closing Public Notice").
95 See id.
96 See AWS-1 and Broadband PCS Procedures Public Notice, 23 FCC Rcd at 7499. Auction 78 also included an
auction of broadband PCS licenses.
97 See Auction of AWS-1 and Broadband PCS Licenses Closes, Winning Bidders Announced for Auction 78, Down
Payments Due September 9, 2008, FCC Forms 601 and 602 Due September 9, 2008, Final Payments Due
September 23, 2008, Ten-Day Petition to Deny Period
, Public Notice, 23 FCC Rcd 12,749 (2008).
17

Federal Communications Commission

FCC 11-151

has proposed to treat both AWS-2 and AWS-3 similarly to broadband PCS service and AWS-1
service due to the comparable capital requirements and other factors, such as issues involved in
relocating incumbents and developing markets, technologies, and services.98
53.
700 MHz Guard Band Licenses. In the 700 MHz Guard Band Order, the
Commission adopted size standards for "small businesses" and "very small businesses" for
purposes of determining their eligibility for special provisions such as bidding credits and
installment payments.99 A small business in this service is an entity that, together with its
affiliates and controlling principals, has average gross revenues not exceeding $40 million for the
preceding three years.100 Additionally, a "very small business" is an entity that, together with its
affiliates and controlling principals, has average gross revenues that are not more than $15
million for the preceding three years.101 SBA approval of these definitions is not required.102 In
2000, the Commission conducted an auction of 52 Major Economic Area ("MEA") licenses.103
Of the 104 licenses auctioned, 96 licenses were sold to nine bidders. Five of these bidders were
small businesses that won a total of 26 licenses. A second auction of 700 MHz Guard Band
licenses commenced and closed in 2001. All eight of the licenses auctioned were sold to three
bidders. One of these bidders was a small business that won a total of two licenses.104
54.
Upper 700 MHz Band Licenses. In the 700 MHz Second Report and Order, the
Commission revised its rules regarding Upper 700 MHz licenses.105 On January 24, 2008, the


98 Service Rules for Advanced Wireless Services in the 19151920 MHz, 19952000 MHz, 20202025 MHz and
21752180 MHz Bands et al.
, Notice of Proposed Rulemaking, 19 FCC Rcd 19,263, App. B (2005); Service Rules
for Advanced Wireless Services in the 21552175 MHz Band
, Notice of Proposed Rulemaking, 22 FCC Rcd 17,035,
App. (2007); Service Rules for Advanced Wireless Services in the 2155-2175 MHz Band, Further Notice of Proposed
Rulemaking, 23 FCC Rcd 9859, App. B (2008).
99 Service Rules for the 746-764 MHz Bands, and Revisions to Part 27 of the Commission's Rules, Second Report
and Order, 15 FCC Rcd 5299 (2000). Service rules were amended in 2007, but no changes were made to small
business size categories. See Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, WT Docket No. 06-
150, Revision of the Commission's Rules to Ensure Compatibility with Enhanced 911 Emergency Calling Systems,
CC Docket No. 94-102, Section 68.4(a) of the Commission's Rules Governing Hearing Aid-Compatible Telephones,
WT Docket No. 01-309, Biennial Regulatory Review Amendment of Parts 1, 22, 24, 27, and 90 to Streamline and
Harmonize Various Rules Affecting Wireless Radio Services, WT Docket 03-264, Former Nextel Communications,
Inc. Upper 700 MHz Guard Band Licenses and Revisions to Part 27 of the Commission's Rules, WT Docket No. 06-
169, Implementing a Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, PS Docket
No. 06-229, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and
Local Public Safety Communications Requirements Through the Year 2010
, WT Docket No. 96-86, Report and
Order and Further Notice of Proposed Rulemaking, 22 FCC Rcd 8064 (2007).
100 Id. at 5343 108.
101 Id.
102 Id. at 5343 108 n.246 (for the 746-764 MHz and 776-704 MHz bands, the Commission is exempt from 15
U.S.C. 632, which requires Federal agencies to obtain Small Business Administration approval before adopting
small business size standards).
103 See 700 MHz Guard Bands Auction Closes: Winning Bidders Announced, Public Notice, 15 FCC Rcd 18026
(2000).
104 See 700 MHz Guard Bands Auction Closes: Winning Bidders Announced, Public Notice, 16 FCC Rcd 4590
(WTB 2001).
105 700 MHz Second Report and Order, 22 FCC Rcd 15289.
18

Federal Communications Commission

FCC 11-151

Commission commenced Auction 73 in which several licenses in the Upper 700 MHz band were
available for licensing: 12 Regional Economic Area Grouping licenses in the C Block, and one
nationwide license in the D Block.106 The auction concluded on March 18, 2008, with 3 winning
bidders claiming very small business status (those with attributable average annual gross
revenues that do not exceed $15 million for the preceding three years) and winning five licenses.
55.
Lower 700 MHz Band Licenses. The Commission previously adopted criteria for
defining three groups of small businesses for purposes of determining their eligibility for special
provisions such as bidding credits.107 The Commission defined a "small business" as an entity
that, together with its affiliates and controlling principals, has average gross revenues not
exceeding $40 million for the preceding three years.108 A "very small business" is defined as an
entity that, together with its affiliates and controlling principals, has average gross revenues that
are not more than $15 million for the preceding three years.109 Additionally, the lower 700 MHz
Service had a third category of small business status for Metropolitan/Rural Service Area
(MSA/RSA) licenses--"entrepreneur"--which is defined as an entity that, together with its
affiliates and controlling principals, has average gross revenues that are not more than $3 million
for the preceding three years.110 The SBA approved these small size standards.111 An auction of
740 licenses (one license in each of the 734 MSAs/RSAs and one license in each of the six
Economic Area Groupings (EAGs)) was conducted in 2002. Of the 740 licenses available for
auction, 484 licenses were won by 102 winning bidders. Seventy-two of the winning bidders
claimed small business, very small business or entrepreneur status and won licenses.112 A second
auction commenced on May 28, 2003, closed on June 13, 2003, and included 256 licenses.113
Seventeen winning bidders claimed small or very small business status, and nine winning bidders
claimed entrepreneur status.114 In 2005, the Commission completed an auction of 5 licenses in
the Lower 700 MHz band. All three winning bidders claimed small business status.
56.
In 2007, the Commission reexamined its rules governing the 700 MHz band in the
700 MHz Second Report and Order.115 An auction of A, B and E block 700 MHz licenses was
held in 2008.116 Twenty winning bidders claimed small business status (those with attributable
average annual gross revenues that exceed $15 million and do not exceed $40 million for the
preceding three years). Thirty three winning bidders claimed very small business status (those


106 See Auction of 700 MHz Band Licenses Closes, Public Notice, 23 FCC Rcd 4572 (WTB 2008).
107 See Reallocation and Service Rules for the 698746 MHz Spectrum Band (Television Channels 5259), Report
and Order, 17 FCC Rcd 1022 (2002) ("Channels 5259 Report and Order").
108 See id., 17 FCC Rcd at 108788 172.
109 See id.
110 See id., 17 FCC Rcd at 1088 173.
111 See Alvarez Letter 1998.
112 See Lower 700 MHz Band Auction Closes, Public Notice, 17 FCC Rcd 17,272 (2002).
113 See Lower 700 MHz Band Auction Closes, Public Notice, 18 FCC Rcd 11,873 (2003).
114 See id.
115 700 MHz Second Report and Order, Second Report and Order, 22 FCC Rcd 15,289, 15,359 n.434 (2007).
116 See Auction of 700 MHz Band Licenses Closes, Public Notice, 23 FCC Rcd 4572 (2008).
19

Federal Communications Commission

FCC 11-151

with attributable average annual gross revenues that do not exceed $15 million for the preceding
three years).
57.
Offshore Radiotelephone Service. This service operates on several UHF
television broadcast channels that are not used for television broadcasting in the coastal areas of
states bordering the Gulf of Mexico. There are presently approximately 55 licensees in this
service. The Commission is unable to estimate at this time the number of licensees that would
qualify as small under the SBA's small business size standard for the category of Wireless
Telecommunications Carriers (except Satellite). Under that SBA small business size standard, a
business is small if it has 1,500 or fewer employees. Census data for 2007 show that there were
1,383 firms that operated that year. Of those 1,383, 1,368 had fewer than 100 employees, and 15
firms had more than 100 employees.117 Thus under this category and the associated small
business size standard, the majority of firms can be considered small.
58.
Government Transfer Bands. The Commission adopted small business size
standards for the unpaired 1390-1392 MHz, 1670-1675 MHz, and the paired 1392-1395 MHz
and 1432-1435 MHz bands.118 Specifically, with respect to these bands, the Commission defined
an entity with average annual gross revenues for the three preceding years not exceeding $40
million as a "small business," and an entity with average annual gross revenues for the three
preceding years not exceeding $15 million as a "very small business."119 SBA has approved
these small business size standards for the aforementioned bands.120 Correspondingly, the
Commission adopted a bidding credit of 15 percent for "small businesses" and a bidding credit
of 25 percent for "very small businesses."121 This bidding credit structure was found to have
been consistent with the Commission's schedule of bidding credits, which may be found at


117 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
118 See Amendments to Parts 1, 2, 27 and 90 of the Commission's Rules to License Services in the 216-220 MHz,
1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz
Government Transfer Bands
, Report and Order, 17 FCC Rcd 9980 (2002).
119 See Reallocation of the 216-220 MHz, 1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435 MHz,
1670-1675 MHz, and 2385-2390 MHz Government Transfer Bands
, WT Docket No. 02-8, Notice of Proposed
Rulemaking, 17 FCC Rcd 2500, 2550-51 144-146 (2002). To be consistent with the size standard of "very small
business" proposed for the 1427-1432 MHz band for those entities with average gross revenues for the three
preceding years not exceeding $3 million, the Service Rules Notice proposed to use the terms "entrepreneur" and
"small business" to define entities with average gross revenues for the three preceding years not exceeding $40
million and $15 million, respectively. Because the Commission is not adopting small business size standards for the
1427-1432 MHz band, it instead uses the terms "small business" and "very small business" to define entities with
average gross revenues for the three preceding years not exceeding $40 million and $15 million, respectively.
120 See Letter from Hector V. Barreto, Administrator, Small Business Administration, to Margaret W. Wiener,
Chief, Auctions and Industry Analysis Division, Wireless Telecommunications Bureau, Federal Communications
Commission, dated Jan. 18, 2002.
121 Such bidding credits are codified for the unpaired 1390-1392 MHz, paired 1392-1395 MHz, and the paired 1432-
1435 MHz bands in 47 C.F.R. 27.807. Such bidding credits are codified for the unpaired 1670-1675 MHz band in
47 C.F.R. 27.906.
20

Federal Communications Commission

FCC 11-151

section 1.2110(f)(2) of the Commission's rules.122 The Commission found that these two
definitions will provide a variety of businesses seeking to provide a variety of services with
opportunities to participate in the auction of licenses for this spectrum and will afford such
licensees, who may have varying capital costs, substantial flexibility for the provision of
services.123 The Commission noted that it had long recognized that bidding preferences for
qualifying bidders provide such bidders with an opportunity to compete successfully against
large, well-financed entities.124 The Commission also noted that it had found that the use of
tiered or graduated small business definitions is useful in furthering its mandate under Section
309(j) of the Act to promote opportunities for and disseminate licenses to a wide variety of
applicants.125 An auction for one license in the 1670-1674 MHz band commenced on April 30,
2003 and closed the same day. One license was awarded. The winning bidder was not a small
entity.
b.

Certain Equipment Manufacturers and Stores

59.
Part 15 Handset Manufacturers. Manufacturers of unlicensed wireless handsets
may also become subject to requirements in this proceeding for their handsets used to provide
VoIP applications. The Commission has not developed a definition of small entities applicable
to unlicensed communications handset manufacturers. Therefore, we will utilize the SBA
definition applicable to Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. The Census Bureau defines this category as follows: "This industry
comprises establishments primarily engaged in manufacturing radio and television broadcast and
wireless communications equipment. Examples of products made by these establishments are:
transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular
phones, mobile communications equipment, and radio and television studio and broadcasting
equipment."126 The SBA has developed a small business size standard for Radio and Television
Broadcasting and Wireless Communications Equipment Manufacturing, which is: all such firms
having 750 or fewer employees.127 According to Census Bureau data for 2007, there were a total
of 939 establishments in this category that operated for part or all of the entire year. Of this total,


122 In the Part 1 Third Report and Order, the Commission adopted a standard schedule of bidding credits, the levels
of which were developed based on its auction experience. Part 1 Third Report and Order, 13 FCC Rcd at 403-04
47; see also 47 C.F.R. 1.2110(f)(2).
123 See Service Rules Notice, 17 FCC Rcd at 2550-51 145.
124 See, e.g., Revision of Part 22 and Part 90 of the Commission's Rules to Facilitate Future Development of Paging
Systems; Implementation of Section 309(j) of the Communications Act -- Competitive Bidding
, WT Docket No. 96-
18, PR Docket No. 93-253, Memorandum Opinion and Order on Reconsideration and Third Report and Order, 14
FCC Rcd 10030, 10091 112 (1999).
125 47 U.S.C. 309(j)(3)(B), (4)(C)-(D). The Commission will also not adopt special preferences for entities owned
by minorities or women, and rural telephone companies. The Commission did not receive any comments on this
issue, and it does not have an adequate record to support such special provisions under the current standards of
judicial review. See Adarand Constructors v. Pea, 515 U.S. 200 (1995) (requiring a strict scrutiny standard of
review for government mandated race-conscious measures); United States v. Virginia, 518 U.S. 515 (1996)
(applying an intermediate standard of review to a state program based on gender classification).
126 U.S. Census Bureau, 2002 NAICS Definitions, 334220 Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing, http://www.census.gov/epcd/naics02/def/NDEF334.HTM#N3342.
127 13 C.F.R. 121.201, NAICS code 334220.
21

Federal Communications Commission

FCC 11-151

784 had less than 500 employees and 155 had more than 100 employees.128 Thus, under this size
standard, the majority of firms can be considered small.
60.
Radio and Television Broadcasting and Wireless Communications Equipment
Manufacturing. The Census Bureau defines this category as follows: "This industry comprises
establishments primarily engaged in manufacturing radio and television broadcast and wireless
communications equipment. Examples of products made by these establishments are:
transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular
phones, mobile communications equipment, and radio and television studio and broadcasting
equipment." The SBA has developed a small business size standard for Radio and Television
Broadcasting and Wireless Communications Equipment Manufacturing which is: all such firms
having 750 or fewer employees. According to Census Bureau data for 2007, there were a total of
939 establishments in this category that operated for part or all of the entire year. Of this total,
784 had less than 500 employees and 155 had more than 100 employees."129 Thus, under this
size standard, the majority of firms can be considered small.
61.
Radio, Television, and Other Electronics Stores. The Census Bureau defines this
economic census category as follows: "This U.S. industry comprises: (1) establishments known
as consumer electronics stores primarily engaged in retailing a general line of new consumer-
type electronic products; (2) establishments specializing in retailing a single line of consumer-
type electronic products (except computers); or (3) establishments primarily engaged in retailing
these new electronic products in combination with repair services."130 The SBA has developed a
small business size standard for Radio, Television, and Other Electronics Stores, which is: all
such firms having $9 million or less in annual receipts.131 According to Census Bureau data for
2007, there were 24,912 firms in this category that operated for the entire year.132 Of this total,
22,701 firms had annual sales of under $5 million; 570 had annual sales and 533 firms had sales
of $5 million or more but less than $10 million., and 1,641 had annual sales of over 10 million.133
Thus, the majority of firms in this category can be considered small.
c.

Wireline Carriers and Service Providers

62.
Incumbent Local Exchange Carriers (Incumbent LECs). Neither the Commission
nor the SBA has developed a small business size standard specifically for incumbent local
exchange services. The appropriate size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500


128 The NAICS Code for this service is 334220. See 13 C.F.R 121/201. See also
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=500&;-
ds_name=EC0744SSSZ1&-_lang=en.
129 The NAICS Code for this service 334220. See 13 C.F.R 121/201. See also
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=500&;-
ds_name=EC0744SSSZ1&-_lang=en.
130 http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=443112&search=2007%20NAICS%20Search.
131 13 C.F.R. 121.201, NAICS code 443112.
132 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=500&;-
ds_name=EC0744SSSZ1&-_lang=en.
133 Id.
22

Federal Communications Commission

FCC 11-151

or fewer employees.134 Census Bureau data for 2007 shows that there were 3,188 firms in this
category that operated for the entire year. Of this total, 3,144 had employment of 999 or fewer,
and 44 firms had employment of 1000 or more. According to Commission data, 1,307 carriers
reported that they were incumbent local exchange service providers.135 Of these 1,307 carriers,
an estimated 1,006 have 1,500 or fewer employees and 301 have more than 1,500 employees.136
Consequently, the Commission estimates that most providers of local exchange service are small
entities that may be affected by the rules proposed in the NPRM. Thus under this category, the
majority of these incumbent local exchange service providers can be considered small.137
63.
Competitive Local Exchange Carriers (Competitive LECs), Competitive Access
Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers.
Neither the Commission nor the SBA has developed a small business size standard specifically
for these service providers. The appropriate size standard under SBA rules is for the category
Wired Telecommunications Carriers. Under that size standard, such a business is small if it has
1,500 or fewer employees.138 Census Bureau data for 2007 show that there were 3,188 firms in
this category that operated for the entire year. Of this total, 3,144 had employment of 999 or
fewer, and 44 firms had had employment of 1,000 employees or more. Thus under this category
and the associated small business size standard, the majority of these Competitive LECs, CAPs,
Shared-Tenant Service Providers, and Other Local Service Providers can be considered small
entities.139 According to Commission data, 1,442 carriers reported that they were engaged in the
provision of either competitive local exchange services or competitive access provider
services.140 Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees and 186
have more than 1,500 employees.141 In addition, 17 carriers have reported that they are Shared-
Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees.142 In
addition, 72 carriers have reported that they are Other Local Service Providers.143 Of the 72,
seventy have 1,500 or fewer employees and two have more than 1,500 employees.144
Consequently, the Commission estimates that most providers of competitive local exchange
service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service
Providers are small entities that may be affected by rules adopted pursuant to the NPRM.


134 13 C.F.R. 121.201, NAICS code 517110.
135 See Trends in Telephone Service, Federal Communications Commission, Wireline Competition Bureau, Industry
Analysis and Technology Division at Table 5.3 (Sept. 2010) (Trends in Telephone Service).
136 See id.
137 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
138 13 C.F.R. 121.201, NAICS code 517110.
139 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
140 See Trends in Telephone Service, at tbl. 5.3.
141 Id.
142 Id.
143 Id.
144 Id.
23

Federal Communications Commission

FCC 11-151

64.
Interexchange Carriers. Neither the Commission nor the SBA has developed a
small business size standard specifically for providers of interexchange services. The
appropriate size standard under SBA rules is for the category Wired Telecommunications
Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.145
Census Bureau data for 2007 shows that there were 3,188 firms in this category that operated for
the entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had had
employment of 1,000 employees or more. Thus under this category and the associated small
business size standard, the majority of these Interexchange carriers can be considered small
entities.146 According to Commission data, 359 companies reported that their primary
telecommunications service activity was the provision of interexchange services.147 Of these 359
companies, an estimated 317 have 1,500 or fewer employees and 42 have more than 1,500
employees.148 Consequently, the Commission estimates that the majority of interexchange
service providers are small entities that may be affected by rules adopted pursuant to the NPRM.
65.
Operator Service Providers (OSPs). Neither the Commission nor the SBA has
developed a small business size standard specifically for operator service providers. The
appropriate size standard under SBA rules is for the category Wired Telecommunications
Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.149
Census Bureau data for 2007 show that there were 3,188 firms in this category that operated for
the entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had had
employment of 1,000 employees or more. Thus under this category and the associated small
business size standard, the majority of these Interexchange carriers can be considered small
entities.150.According to Commission data, 33 carriers have reported that they are engaged in the
provision of operator services. Of these, an estimated 31 have 1,500 or fewer employees and 2
have more than 1,500 employees.151 Consequently, the Commission estimates that the majority
of OSPs are small entities that may be affected by our proposed rules.
66.
Local Resellers. The SBA has developed a small business size standard for the
category of Telecommunications Resellers. Under that size standard, such a business is small if
it has 1,500 or fewer employees.152 Census data for 2007 show that 1,523 firms provided resale
services during that year. Of that number, 1,522 operated with fewer than 1000 employees and
one operated with more than 1,000.153 Thus under this category and the associated small business


145 13 C.F.R. 121.201, NAICS code 517110.
146 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
147 See Trends in Telephone Service, at tbl. 5.3.
148 Id.
149 13 C.F.R. 121.201, NAICS code 517110.
150 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
151 Trends in Telephone Service, at tbl. 5.3.
152 13 C.F.R. 121.201, NAICS code 517911.
153 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&-ds_name=EC0751SSSZ5&;-
_lang=en.
24

Federal Communications Commission

FCC 11-151

size standard, the majority of these local resellers can be considered small entities. According to
Commission data, 213 carriers have reported that they are engaged in the provision of local
resale services.154 Of these, an estimated 211 have 1,500 or fewer employees and two have more
than 1,500 employees.155 Consequently, the Commission estimates that the majority of local
resellers are small entities that may be affected by rules adopted pursuant to the Notice.
67.
Toll Resellers. The SBA has developed a small business size standard for the
category of Telecommunications Resellers. Under that size standard, such a business is small if
it has 1,500 or fewer employees.156 Census data for 2007 show that 1,523 firms provided resale
services during that year. Of that number, 1,522 operated with fewer than 1,000 employees and
one operated with more than 1,000.157 Thus under this category and the associated small business
size standard, the majority of these resellers can be considered small entities. According to
Commission data,158 881 carriers have reported that they are engaged in the provision of toll
resale services. Of these, an estimated 857 have 1,500 or fewer employees and 24 have more
than 1,500 employees. Consequently, the Commission estimates that the majority of toll
resellers are small entities that may be affected by our proposed rules.
68.
Payphone Service Providers (PSPs). Neither the Commission nor the SBA has
developed a small business size standard specifically for payphone services providers. The
appropriate size standard under SBA rules is for the category Wired Telecommunications
Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.159
Census Bureau data for 2007 shows that there were 3,188 firms in this category that operated for
the entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had had
employment of 1,000 employees or more. Thus under this category and the associated small
business size standard, the majority of these PSPs can be considered small entities.160. According
to Commission data,161 657 carriers have reported that they are engaged in the provision of
payphone services. Of these, an estimated 653 have 1,500 or fewer employees and four have
more than 1,500 employees. Consequently, the Commission estimates that the majority of
payphone service providers are small entities that may be affected by our action.
69.
Prepaid Calling Card Providers. Neither the Commission nor the SBA has
developed a small business size standard specifically for prepaid calling card providers. The
appropriate size standard under SBA rules is for the category Telecommunications Resellers.


154 See Trends in Telephone Service, at tbl. 5.3.
155 Id.
156 13 C.F.R. 121.201, NAICS code 517911.
157 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&-ds_name=EC0751SSSZ5&;-
_lang=en.
158 Trends in Telephone Service, at tbl. 5.3.
159 13 C.F.R. 121.201, NAICS code 517110.
160 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
161 Trends in Telephone Service, at tbl. 5.3.
25

Federal Communications Commission

FCC 11-151

Under that size standard, such a business is small if it has 1,500 or fewer employees.162 Census
data for 2007 show that 1,523 firms provided resale services during that year. Of that number,
1,522 operated with fewer than 1000 employees and one operated with more than 1,000.163 Thus
under this category and the associated small business size standard, the majority of these prepaid
calling card providers can be considered small entities. According to Commission data, 193
carriers have reported that they are engaged in the provision of prepaid calling cards.164 Of these,
all 193 have 1,500 or fewer employees and none have more than 1,500 employees.165
Consequently, the Commission estimates that the majority of prepaid calling card providers are
small entities that may be affected by rules adopted pursuant to the Notice.
70.
800 and 800-Like Service Subscribers.166 Neither the Commission nor the SBA
has developed a small business size standard specifically for 800 and 800-like service ("toll
free") subscribers. The appropriate size standard under SBA rules is for the category
Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500
or fewer employees.167 Census data for 2007 show that 1,523 firms provided resale services
during that year. Of that number, 1,522 operated with fewer than 1000 employees and one
operated with more than 1,000.168 Thus under this category and the associated small business
size standard, the majority of resellers in this classification can be considered small entities. To
focus specifically on the number of subscribers than on those firms which make subscription
service available, the most reliable source of information regarding the number of these service
subscribers appears to be data the Commission collects on the 800, 888, 877, and 866 numbers in
use.169 According to our data for September 2009, the number of 800 numbers assigned was
7,860,000; the number of 888 numbers assigned was 5,888,687; the number of 877 numbers
assigned was 4, 721,866; and the number of 866 numbers assigned was 7, 867,736. The
Commission does not have data specifying the number of these subscribers that are not
independently owned and operated or have more than 1,500 employees, and thus are unable at
this time to estimate with greater precision the number of toll free subscribers that would qualify
as small businesses under the SBA size standard. Consequently, the Commission estimates that
there are 7,860.000 or fewer small entity 800 subscribers; 5,888,687 or fewer small entity 888
subscribers; 4,721,866 or fewer small entity 877 subscribers; and 7,867,736 or fewer small entity
866 subscribers.


162 13 C.F.R. 121.201, NAICS code 517911.
163 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&-ds_name=EC0751SSSZ5&;-
_lang=en.
164 See Trends in Telephone Service, at tbl. 5.3.
165 Id.
166 We include all toll-free number subscribers in this category, including those for 888 numbers.
167 13 C.F.R. 121.201, NAICS code 517911.
168 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&-ds_name=EC0751SSSZ5&;-
_lang=en.
169 Trends in Telephone Service, at tbls. 18.4, 18.5, 18.6, 18.7.
26

Federal Communications Commission

FCC 11-151

d.

Wireless Carriers and Service Providers

71.
Below, for those services where licenses are subject to auctions, the Commission
notes that, as a general matter, the number of winning bidders that qualify as small businesses at
the close of a given auction does not necessarily represent the number of small businesses
currently in service. Also, the Commission does not generally track subsequent business size
unless, in the context of assignments or transfers, unjust enrichment issues are implicated.
72.
Wireless Telecommunications Carriers (except Satellite). Since 2007, the Census
Bureau has placed wireless firms within this new, broad, economic census category.170 Prior to
that time, such firms were within the now-superseded categories of "Paging" and "Cellular and
Other Wireless Telecommunications."171 Under the present and prior categories, the SBA has
deemed a wireless business to be small if it has 1,500 or fewer employees.172 For the category of
Wireless Telecommunications Carriers (except Satellite), Census data for 2007 shows that there
were 1,383 firms that operated that year.173 Of those 1,383, 1,368 had fewer than 100 employees,
and 15 firms had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small. Similarly, according to
Commission data, 413 carriers reported that they were engaged in the provision of wireless
telephony, including cellular service, Personal Communications Service ("PCS"), and
Specialized Mobile Radio ("SMR") Telephony services.174 Of these, an estimated 261 have
1,500 or fewer employees and 152 have more than 1,500 employees.175 Consequently, the
Commission estimates that approximately half or more of these firms can be considered small.
Thus, using available data, we estimate that the majority of wireless firms can be considered
small.
73.
Wireless Communications Services. This service can be used for fixed, mobile,
radiolocation, and digital audio broadcasting satellite uses. The Commission defined "small
business" for the wireless communications services ("WCS") auction as an entity with average
gross revenues of $40 million for each of the three preceding years, and a "very small business"
as an entity with average gross revenues of $15 million for each of the three preceding years.176


170 U.S. Census Bureau, 2007 NAICS Definitions, 517210 Wireless Telecommunications Categories (Except
Satellite), http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
171 U.S. Census Bureau, 2002 NAICS Definitions, 517211 Paging,
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. Census Bureau, 2002 NAICS Definitions, "517212
Cellular and Other Wireless Telecommunications"; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
172 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R. citations were
13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
173 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
174 See Trends in Telephone Service, at tbl. 5.3.
175 Id.
176 Amendment of the Commission's Rules to Establish Part 27, the Wireless Communications Service (WCS), GN
Docket No. 96-228, Report and Order, 12 FCC Rcd 10785, 10879 194 (1997).
27

Federal Communications Commission

FCC 11-151

The SBA has approved these definitions.177 The Commission auctioned geographic area licenses
in the WCS service. In the auction, which commenced on April 15, 1997 and closed on April 25,
1997, seven bidders won 31 licenses that qualified as very small business entities, and one bidder
won one license that qualified as a small business entity.
74.
Common Carrier Paging. The SBA considers paging to be a wireless
telecommunications service and classifies it under the industry classification Wireless
Telecommunications Carriers (except satellite). Under that classification, the applicable size
standard is that a business is small if it has 1,500 or fewer employees. For the general category
of Wireless Telecommunications Carriers (except Satellite), Census data for 2007 shows that
there were 1,383 firms that operated that year.178 Of those 1,383, 1,368 had fewer than 100
employees, and 15 firms had more than 100 employees. Thus under this category and the
associated small business size standard, the majority of firms can be considered small.179 The
2007 census also contains data for the specific category of "Paging" "that is classified under the
seven-number NAICS code 5172101.180 According to Commission data, 291 carriers have
reported that they are engaged in Paging or Messaging Service. Of these, an estimated 289 have
1,500 or fewer employees, and 2 have more than 1,500 employees.181 Consequently, the
Commission estimates that the majority of paging providers are small entities that may be
affected by our action.
75.
Wireless Telephony. Wireless telephony includes cellular, personal
communications services, and specialized mobile radio telephony carriers. As noted, the SBA
has developed a small business size standard for Wireless Telecommunications Carriers (except
Satellite).182 Under the SBA small business size standard, a business is small if it has 1,500 or
fewer employees.183 Census data for 2007 shows that there were 1,383 firms that operated that
year.184 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100
employees. Thus under this category and the associated small business size standard, the
majority of firms can be considered small. According to Trends in Telephone Service data, 434


177 See Letter from Aida Alvarez, Administrator, SBA, to Amy Zoslov, Chief, Auctions and Industry Analysis
Division, Wireless Telecommunications Bureau, FCC (filed Dec. 2, 1998) (Alvarez Letter 1998).
178 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
179 13 C.F.R. 121.201, NAICS code 517210.
180http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=700&-ds_name=EC0751SSSZ5&;-
_lang=en In this specific category, there were 248 firms that operated for the entire year in 2007. Of that number
247 operated with fewer than 100 employees and one (1) operated with more than 1000 employees. Based on this
classification and the associated size standard, the majority of paging firms must be considered small.
181 See Trends in Telephone Service, at tbl. 5.3.
182 13 C.F.R. 121.201, NAICS code 517210.
183 Id.
184 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
28

Federal Communications Commission

FCC 11-151

carriers reported that they were engaged in wireless telephony.185 Of these, an estimated 222
have 1,500 or fewer employees and 212 have more than 1,500 employees.186 Therefore,
approximately half of these entities can be considered small. Similarly, according to
Commission data, 413 carriers reported that they were engaged in the provision of wireless
telephony, including cellular service, Personal Communications Service (PCS), and Specialized
Mobile Radio (SMR) Telephony services.187 Of these, an estimated 261 have 1,500 or fewer
employees and 152 have more than 1,500 employees.188 Consequently, the Commission
estimates that approximately half or more of these firms can be considered small. Thus, using
available data, we estimate that the majority of wireless firms can be considered small.
76.
Broadband Personal Communications Service. The broadband personal
communications services (PCS) spectrum is divided into six frequency blocks designated A
through F, and the Commission has held auctions for each block. The Commission initially
defined a "small business" for C- and F-Block licenses as an entity that has average gross
revenues of $40 million or less in the three previous calendar years.189 For F-Block licenses, an
additional small business size standard for "very small business" was added and is defined as an
entity that, together with its affiliates, has average gross revenues of not more than $15 million
for the preceding three calendar years.190 These small business size standards, in the context of
broadband PCS auctions, have been approved by the SBA.191 No small businesses within the
SBA-approved small business size standards bid successfully for licenses in Blocks A and B.
There were 90 winning bidders that claimed small business status in the first two C-Block
auctions. A total of 93 bidders that claimed small business status won approximately 40 percent
of the 1,479 licenses in the first auction for the D, E, and F Blocks.192 On April 15, 1999, the
Commission completed the re-auction of 347 C-, D-, E-, and F-Block licenses in Auction No.
22.193 Of the 57 winning bidders in that auction, 48 claimed small business status and won 277
licenses.
77.
On January 26, 2001, the Commission completed the auction of 422 C and F
Block Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in that auction, 29


185 Trends in Telephone Service, at tbl. 5.3.
186 Id.
187 See Trends in Telephone Service, at tbl. 5.3.
188 See id.
189 See Amendment of Parts 20 and 24 of the Commission's Rules Broadband PCS Competitive Bidding and the
Commercial Mobile Radio Service Spectrum Cap; Amendment of the Commission's Cellular/PCS Cross-Ownership
Rule
, WT Docket No. 96-59, GN Docket No. 90-314, Report and Order, 11 FCC Rcd 7824, 785052 5760
(1996) ("PCS Report and Order"); see also 47 C.F.R. 24.720(b).
190 See PCS Report and Order, 11 FCC Rcd at 7852 60.
191 See Alvarez Letter 1998.
192 See Broadband PCS, D, E and F Block Auction Closes, Public Notice, Doc. No. 89838 (rel. Jan. 14, 1997).
193 See C, D, E, and F Block Broadband PCS Auction Closes, Public Notice, 14 FCC Rcd 6688 (WTB 1999).
Before Auction No. 22, the Commission established a very small standard for the C Block to match the standard
used for F Block. Amendment of the Commission's Rules Regarding Installment Payment Financing for Personal
Communications Services (PCS) Licensees
, WT Docket No. 97-82, Fourth Report and Order, 13 FCC Rcd 15743,
15768 46 (1998).
29

Federal Communications Commission

FCC 11-151

claimed small business status.194 Subsequent events concerning Auction 35, including judicial
and agency determinations, resulted in a total of 163 C and F Block licenses being available for
grant. On February 15, 2005, the Commission completed an auction of 242 C-, D-, E-, and F-
Block licenses in Auction No. 58. Of the 24 winning bidders in that auction, 16 claimed small
business status and won 156 licenses.195 On May 21, 2007, the Commission completed an
auction of 33 licenses in the A, C, and F Blocks in Auction No. 71.196 Of the 12 winning bidders
in that auction, five claimed small business status and won 18 licenses.197 On August 20, 2008,
the Commission completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS licenses in
Auction No. 78.198 Of the eight winning bidders for Broadband PCS licenses in that auction, six
claimed small business status and won 14 licenses.199
78.
Narrowband Personal Communications Services. To date, two auctions of
narrowband personal communications services ("PCS") licenses have been conducted. For
purposes of the two auctions that have already been held, "small businesses" were entities with
average gross revenues for the prior three calendar years of $40 million or less. Through these
auctions, the Commission has awarded a total of 41 licenses, out of which 11 were obtained by
small businesses. To ensure meaningful participation of small business entities in future
auctions, the Commission has adopted a two-tiered small business size standard in the
Narrowband PCS Second Report and Order.200 A "small business" is an entity that, together
with affiliates and controlling interests, has average gross revenues for the three preceding years
of not more than $40 million. A "very small business" is an entity that, together with affiliates
and controlling interests, has average gross revenues for the three preceding years of not more
than $15 million. The SBA has approved these small business size standards.201 A third auction
of Narrowband PCS licenses was conducted in 2001. In that auction, five bidders won 317
Metropolitan Trading Areas and nationwide licenses.202 Three of the winning bidders claimed
status as a small or very small entity and won 311 licenses.


194 See C and F Block Broadband PCS Auction Closes; Winning Bidders Announced, Public Notice, 16 FCC Rcd
2339 (2001).
195 See Broadband PCS Spectrum Auction Closes; Winning Bidders Announced for Auction No. 58, Public Notice,
20 FCC Rcd 3703 (2005).
196 See Auction of Broadband PCS Spectrum Licenses Closes; Winning Bidders Announced for Auction No. 71,
Public Notice, 22 FCC Rcd 9247 (2007).
197 Id.
198 See Auction of AWS-1 and Broadband PCS Licenses Closes; Winning Bidders Announced for Auction 78, Public
Notice, 23 FCC Rcd 12749 (WTB 2008).
199 Id.
200 Amendment of the Commission's Rules to Establish New Personal Communications Services, Narrowband PCS,
GEN Docket No. 90-314, ET Docket No. 92-100, PP Docket No. 93-253, Second Report and Order and Second
Further Notice of Proposed Rulemaking, 15 FCC Rcd 10456 (2000) ("Narrowband PCS Second Report and
Order
").
201 See Letter to Amy Zoslov, Chief, Auctions and Industry Analysis Division, Wireless Telecommunications
Bureau, FCC, from Aida Alvarez, Administrator, SBA (Dec. 2, 1998).
202 See Narrowband PCS Auction Closes, Public Notice, 16 FCC Rcd 18663 (WTB 2001).
30

Federal Communications Commission

FCC 11-151

79.
220 MHz Radio Service Phase I Licensees. The 220 MHz service has both
Phase I and Phase II licenses. Phase I licensing was conducted by lotteries in 1992 and 1993.
There are approximately 1,515 such non-nationwide licensees and four nationwide licensees
currently authorized to operate in the 220 MHz band. The Commission has not developed a
small business size standard for small entities specifically applicable to such incumbent 220
MHz Phase I licensees. To estimate the number of such licensees that are small businesses, the
Commission applies the small business size standard under the SBA rules applicable. The SBA
has deemed a wireless business to be small if it has 1,500 or fewer employees.203 For this
service, the SBA uses the category of Wireless Telecommunications Carriers (except Satellite).
Census data for 2007, which supersede data contained in the 2002 Census, show that there were
1,383 firms that operated that year.204 Of those 1,383, 1,368 had fewer than 100 employees, and
15 firms had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small.
80.
220 MHz Radio Service Phase II Licensees. The 220 MHz service has both Phase
I and Phase II licenses. The Phase II 220 MHz service is a new service, and is subject to
spectrum auctions. In the 220 MHz Third Report and Order, the Commission adopted a small
business size standard for defining "small" and "very small" businesses for purposes of
determining their eligibility for special provisions such as bidding credits and installment
payments.205 This small business standard indicates that a "small business" is an entity that,
together with its affiliates and controlling principals, has average gross revenues not exceeding
$15 million for the preceding three years.206 A "very small business" is defined as an entity that,
together with its affiliates and controlling principals, has average gross revenues that do not
exceed $3 million for the preceding three years.207 The SBA has approved these small size
standards.208 Auctions of Phase II licenses commenced on and closed in 1998.209 In the first
auction, 908 licenses were auctioned in three different-sized geographic areas: three nationwide
licenses, 30 Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA)
Licenses. Of the 908 licenses auctioned, 693 were sold.210 Thirty-nine small businesses won 373
licenses in the first 220 MHz auction. A second auction included 225 licenses: 216 EA licenses


203 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R. citations were
13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
204 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
205 Amendment of Part 90 of the Commission's Rules to Provide For the Use of the 220-222 MHz Band by the
Private Land Mobile Radio Service
, Third Report and Order, 12 FCC Rcd 10943, 11068-70 291-295 (1997).
206 Id. at 11068 291.
207 Id.
208 See Letter to Daniel Phythyon, Chief, Wireless Telecommunications Bureau, Federal Communications
Commission, from Aida Alvarez, Administrator, Small Business Administration, dated January 6, 1998 (Alvarez to
Phythyon Letter 1998
).
209 See generally 220 MHz Service Auction Closes, Public Notice, 14 FCC Rcd 605 (WTB 1998).
210 See FCC Announces It is Prepared to Grant 654 Phase II 220 MHz Licenses After Final Payment is Made,
Public Notice, 14 FCC Rcd 1085 (WTB 1999).
31

Federal Communications Commission

FCC 11-151

and 9 EAG licenses. Fourteen companies claiming small business status won 158 licenses.211 A
third auction included four licenses: 2 BEA licenses and 2 EAG licenses in the 220 MHz
Service. No small or very small business won any of these licenses.212 In 2007, the Commission
conducted a fourth auction of the 220 MHz licenses.213 Bidding credits were offered to small
businesses. A bidder with attributed average annual gross revenues that exceeded $3 million and
did not exceed $15 million for the preceding three years ("small business") received a 25 percent
discount on its winning bid. A bidder with attributed average annual gross revenues that did not
exceed $3 million for the preceding three years received a 35 percent discount on its winning bid
("very small business"). Auction 72, which offered 94 Phase II 220 MHz Service licenses,
concluded in 2007.214 In this auction, five winning bidders won a total of 76 licenses. Two
winning bidders identified themselves as very small businesses won 56 of the 76 licenses. One
of the winning bidders that identified themselves as a small business won 5 of the 76 licenses
won.
81.
800 MHz and 900 MHz Specialized Mobile Radio Licenses. The Commission
awards small business bidding credits in auctions for Specialized Mobile Radio ("SMR")
geographic area licenses in the 800 MHz and 900 MHz bands to entities that had revenues of no
more than $15 million in each of the three previous calendar years.215 The Commission awards
very small business bidding credits to entities that had revenues of no more than $3 million in
each of the three previous calendar years.216 The SBA has approved these small business size
standards for the 800 MHz and 900 MHz SMR Services.217 The Commission has held auctions
for geographic area licenses in the 800 MHz and 900 MHz bands. The 900 MHz SMR auction
was completed in 1996.218 Sixty bidders claiming that they qualified as small businesses under
the $15 million size standard won 263 geographic area licenses in the 900 MHz SMR band.219
The 800 MHz SMR auction for the upper 200 channels was conducted in 1997. Ten bidders
claiming that they qualified as small businesses under the $15 million size standard won 38
geographic area licenses for the upper 200 channels in the 800 MHz SMR band.220 A second


211 See Phase II 220 MHz Service Spectrum Auction Closes, Public Notice, 14 FCC Rcd 11218 (WTB 1999).
212 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
213 See Auction of Phase II 220 MHz Service Spectrum Scheduled for June 20, 2007, Notice and Filing
Requirements, Minimum Opening Bids, Upfront Payments and Other Procedures for Auction 72
, Public Notice, 22
FCC Rcd 3404 (2007).
214 See Auction of Phase II 220 MHz Service Spectrum Licenses Closes, Winning Bidders Announced for Auction 72,
Down Payments due July 18, 2007, FCC Forms 601 and 602 due July 18, 2007, Final Payments due August 1,
2007, Ten-Day Petition to Deny Period
, Public Notice, 22 FCC Rcd 11573 (2007).
215 47 C.F.R. 90.810, 90.814(b), 90.912.
216 Id.
217 See Alvarez Letter 1999.
218 FCC Announces Winning Bidders in the Auction of 1,020 Licenses to Provide 900 MHz SMR in Major Trading
Areas: Down Payments due April 22, 1996, FCC Form 600s due April 29, 1996
, Public Notice, 11 FCC Rcd 18599
(WTB 1996).
219 Id.
220 See Correction to Public Notice DA 96-586, FCC Announces Winning Bidders in the Auction of 1020 Licenses to
Provide 900 MHz SMR in Major Trading Areas,
Public Notice, 11 FCC Rcd 18637 (WTB 1996).
32

Federal Communications Commission

FCC 11-151

auction for the 800 MHz band was conducted in 2002 and included 23 BEA licenses. One
bidder claiming small business status won five licenses.221
82.
The auction of the 1,053 800 MHz SMR geographic area licenses for the General
Category channels was conducted in 2000. Eleven bidders won 108 geographic area licenses for
the General Category channels in the 800 MHz SMR band qualified as small businesses under
the $15 million size standard.222 In an auction completed in 2000, a total of 2,800 Economic
Area licenses in the lower 80 channels of the 800 MHz SMR service were awarded.223 Of the 22
winning bidders, 19 claimed small business status and won 129 licenses. Thus, combining all
three auctions, 40 winning bidders for geographic licenses in the 800 MHz SMR band claimed
status as small business.
83.
In addition, there are numerous incumbent site-by-site SMR licensees and
licensees with extended implementation authorizations in the 800 and 900 MHz bands. We do
not know how many firms provide 800 MHz or 900 MHz geographic area SMR pursuant to
extended implementation authorizations, nor how many of these providers have annual revenues
of no more than $15 million. One firm has over $15 million in revenues. In addition, we do not
know how many of these firms have 1,500 or fewer employees.224 We assume, for purposes of
this analysis, that all of the remaining existing extended implementation authorizations are held
by small entities, as that small business size standard is approved by the SBA.
84.
Air-Ground Radiotelephone Service. The Commission has previously used the
SBA's small business size standard applicable to Wireless Telecommunications Carriers (except
Satellite), i.e., an entity employing no more than 1,500 persons.225 There are approximately 100
licensees in the Air-Ground Radiotelephone Service, and under that definition, the Commission
estimates that almost all of them qualify as small entities under the SBA definition. For purposes
of assigning Air-Ground Radiotelephone Service licenses through competitive bidding, the
Commission has defined "small business" as an entity that, together with controlling interests
and affiliates, has average annual gross revenues for the preceding three years not exceeding $40
million.226 A "very small business" is defined as an entity that, together with controlling interests
and affiliates, has average annual gross revenues for the preceding three years not exceeding $15
million.227 These definitions were approved by the SBA.228 In May 2006, the Commission


221 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
222 See 800 MHz Specialized Mobile Radio (SMR) Service General Category (851-854 MHz) and Upper Band (861-
865 MHz) Auction Closes; Winning Bidders Announced,
Public Notice, 15 FCC Rcd 17162 (WTB 2000).
223 See 800 MHz SMR Service Lower 80 Channels Auction Closes; Winning Bidders Announced, Public Notice, 16
FCC Rcd 1736 (WTB 2000).

224 See generally 13 C.F.R. 121.201, NAICS code 517210.
225 13 C.F.R. 121.201, NAICS codes 517210.
226 Amendment of Part 22 of the Commission's Rules to Benefit the Consumers of Air-Ground Telecommunications
Services, Biennial Regulatory Review--Amendment of Parts 1, 22, and 90 of the Commission's Rules, Amendment of
Parts 1 and 22 of the Commission's Rules to Adopt Competitive Bidding Rules for Commercial and General
Aviation Air-Ground Radiotelephone Service
, WT Docket Nos. 03-103, 05-42, Order on Reconsideration and Report
and Order, 20 FCC Rcd 19663 2842 (2005).
227 Id.
33

Federal Communications Commission

FCC 11-151

completed an auction of nationwide commercial Air-Ground Radiotelephone Service licenses in
the 800 MHz band (Auction No. 65). On June 2, 2006, the auction closed with two winning
bidders winning two Air-Ground Radiotelephone Services licenses. Neither of the winning
bidders claimed small business status.
85.
Rural Radiotelephone Service. The Commission has not adopted a size standard
for small businesses specific to the Rural Radiotelephone Service.229 A significant subset of the
Rural Radiotelephone Service is the Basic Exchange Telephone Radio System ("BETRS").230
For purposes of its analysis of the Rural Radiotelephone Service, the Commission uses the SBA
small business size standard for the category Wireless Telecommunications Carriers (except
satellite)," which is 1,500 or fewer employees.231 Census data for 2007 shows that there were
1,383 firms that operated that year.232 Of those 1,383, 1,368 had fewer than 100 employees, and
15 firms had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms in the Rural Radiotelephone Service can be
considered small.
86.
Aviation and Marine Radio Services. Small businesses in the aviation and marine
radio services use a very high frequency ("VHF") marine or aircraft radio and, as appropriate, an
emergency position-indicating radio beacon (and/or radar) or an emergency locator transmitter.
The Commission has not developed a small business size standard specifically applicable to
these small businesses. For purposes of this analysis, the Commission uses the SBA small
business size standard for the category Wireless Telecommunications Carriers (except satellite),"
which is 1,500 or fewer employees.233 Census data for 2007 shows that there were 1,383 firms
that operated that year.234 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had
more than 100 employees. Thus under this category and the associated small business size
standard, the majority of firms can be considered small.
87.
Fixed Microwave Services. Microwave services include common carrier,235
private-operational fixed,236 and broadcast auxiliary radio services.237 They also include the Local
(Continued from previous page)


228 See Letter from Hector V. Barreto, Administrator, SBA, to Gary D. Michaels, Deputy Chief, Auctions and
Spectrum Access Division, Wireless Telecommunications Bureau, FCC (filed Sept. 19, 2005).
229 The service is defined in section 22.99 of the Commission's Rules, 47 C.F.R. 22.99.
230 BETRS is defined in sections 22.757 and 22.759 of the Commission's Rules, 47 C.F.R. 22.757 and 22.759.
231 13 C.F.R. 121.201, NAICS code 517210.
232 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
233 13 C.F.R. 121.201, NAICS code 517210.
234 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
235 See 47 C.F.R. Part 101, Subparts C and I.
236 See id. Subparts C and H.
34

Federal Communications Commission

FCC 11-151

Multipoint Distribution Service ("LMDS"),238 the Digital Electronic Message Service
("DEMS"),239 and the 24 GHz Service,240 where licensees can choose between common carrier
and non-common carrier status.241 The Commission has not yet defined a small business with
respect to microwave services. For purposes of this IRFA, the Commission will use the SBA's
definition applicable to Wireless Telecommunications Carriers (except satellite)--i.e., an entity
with no more than 1,500 persons is considered small.242 For the category of Wireless
Telecommunications Carriers (except Satellite), Census data for 2007 shows that there were
1,383 firms that operated that year.243 Of those 1,383, 1,368 had fewer than 100 employees, and
15 firms had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small. The Commission notes
that the number of firms does not necessarily track the number of licensees. The Commission
estimates that virtually all of the Fixed Microwave licensees (excluding broadcast auxiliary
licensees) would qualify as small entities under the SBA definition.
88.
Offshore Radiotelephone Service. This service operates on several UHF
television broadcast channels that are not used for television broadcasting in the coastal areas of
states bordering the Gulf of Mexico.244 There are presently approximately 55 licensees in this
service. The Commission is unable to estimate at this time the number of licensees that would
qualify as small under the SBA's small business size standard for the category of Wireless
Telecommunications Carriers (except Satellite). Under that standard.245 Under that SBA small
business size standard, a business is small if it has 1,500 or fewer employees.246 Census data for
2007 shows that there were 1,383 firms that operated that year.247 Of those 1,383, 1,368 had
fewer than 100 employees, and 15 firms had more than 100 employees. Thus under this category
and the associated small business size standard, the majority of firms can be considered small.
(Continued from previous page)


237 Auxiliary Microwave Service is governed by Part 74 of Title 47 of the Commission's Rules. See 47 C.F.R. Part
74. Available to licensees of broadcast stations and to broadcast and cable network entities, broadcast auxiliary
microwave stations are used for relaying broadcast television signals from the studio to the transmitter, or between
two points such as a main studio and an auxiliary studio. The service also includes mobile TV pickups, which relay
signals from a remote location back to the studio.
238 See 47 C.F.R. Part 101, Subpart L.
239 See id. Subpart G.
240 See id.
241 See 47 C.F.R. 101.533, 101.1017.
242 13 C.F.R. 121.201, NAICS code 517210.
243 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
244 This service is governed by Subpart I of Part 22 of the Commission's Rules. See 47 C.F.R. 22.1001-22.1037.
245 13 C.F.R. 121.201, NAICS code 517210.
246 Id.
247 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
35

Federal Communications Commission

FCC 11-151

89.
39 GHz Service. The Commission created a special small business size standard
for 39 GHz licenses an entity that has average gross revenues of $40 million or less in the three
previous calendar years.248 An additional size standard for "very small business" is: an entity
that, together with affiliates, has average gross revenues of not more than $15 million for the
preceding three calendar years.249 The SBA has approved these small business size standards.250
The auction of the 2,173 39 GHz licenses began on April 12, 2000 and closed on May 8, 2000.
The 18 bidders who claimed small business status won 849 licenses. Consequently, the
Commission estimates that 18 or fewer 39 GHz licensees are small entities that may be affected
by our action.
90.
Wireless Cable Systems. Broadband Radio Service and Educational Broadband
Service. Broadband Radio Service systems, previously referred to as Multipoint Distribution
Service ("MDS") and Multichannel Multipoint Distribution Service ("MMDS") systems, and
"wireless cable," transmit video programming to subscribers and provide two-way high speed
data operations using the microwave frequencies of the Broadband Radio Service ("BRS") and
Educational Broadband Service ("EBS") (previously referred to as the Instructional Television
Fixed Service ("ITFS").251 In connection with the 1996 BRS auction, the Commission
established a small business size standard as an entity that had annual average gross revenues of
no more than $40 million in the previous three calendar years.252 The BRS auctions resulted in
67 successful bidders obtaining licensing opportunities for 493 Basic Trading Areas ("BTAs").
Of the 67 auction winners, 61 met the definition of a small business. BRS also includes
licensees of stations authorized prior to the auction. At this time, we estimate that of the 61
small business BRS auction winners, 48 remain small business licensees. In addition to the 48
small businesses that hold BTA authorizations, there are approximately 392 incumbent BRS
licensees that are considered small entities.253 After adding the number of small business auction
licensees to the number of incumbent licensees not already counted, we find that there are
currently approximately 440 BRS licensees that are defined as small businesses under either the
SBA or the Commission's rules. In 2009, the Commission conducted Auction 86, the sale of 78
licenses in the BRS areas.254 The Commission offered three levels of bidding credits: (i) a bidder


248 See Amendment of the Commission's Rules Regarding the 37.0-38.6 GHz and 38.6-40.0 GHz Bands, ET Docket
No. 95-183, PP Docket No. 93-253, Report and Order, 12 FCC Rcd 18600 (1998).
249 Id.
250 See Letter to Kathleen O'Brien Ham, Chief, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, FCC, from Aida Alvarez, Administrator, SBA (Feb. 4, 1998).
251 Amendment of Parts 21 and 74 of the Commission's Rules with Regard to Filing Procedures in the Multipoint
Distribution Service and in the Instructional Television Fixed Service and Implementation of Section 309(j) of the
Communications Act--Competitive Bidding
, MM Docket No. 94-131, PP Docket No. 93-253, Report and Order, 10
FCC Rcd 9589, 9593 7 (1995).
252 47 C.F.R. 21.961(b)(1).
253 47 U.S.C. 309(j). Hundreds of stations were licensed to incumbent MDS licensees prior to implementation of
Section 309(j) of the Communications Act of 1934, 47 U.S.C. 309(j). For these pre-auction licenses, the
applicable standard is SBA's small business size standard of 1500 or fewer employees.
254 Auction of Broadband Radio Service (BRS) Licenses, Scheduled for October 27, 2009, Notice and Filing
Requirements, Minimum Opening Bids, Upfront Payments, and Other Procedures for Auction 86
, Public Notice, 24
FCC Rcd 8277 (2009).
36

Federal Communications Commission

FCC 11-151

with attributed average annual gross revenues that exceed $15 million and do not exceed $40
million for the preceding three years (small business) will receive a 15 percent discount on its
winning bid; (ii) a bidder with attributed average annual gross revenues that exceed $3 million
and do not exceed $15 million for the preceding three years (very small business) will receive a
25 percent discount on its winning bid; and (iii) a bidder with attributed average annual gross
revenues that do not exceed $3 million for the preceding three years (entrepreneur) will receive a
35 percent discount on its winning bid.255 Auction 86 concluded in 2009 with the sale of 61
licenses.256 Of the ten winning bidders, two bidders that claimed small business status won 4
licenses; one bidder that claimed very small business status won three licenses; and two bidders
that claimed entrepreneur status won six licenses.
91.
In addition, the SBA's Cable Television Distribution Services small business size
standard is applicable to EBS. There are presently 2,032 EBS licensees. All but 100 of these
licenses are held by educational institutions. Educational institutions are included in this analysis
as small entities.257 Thus, we estimate that at least 1,932 licensees are small businesses. Since
2007, Cable Television Distribution Services have been defined within the broad economic
census category of Wired Telecommunications Carriers; that category is defined as follows:
"This industry comprises establishments primarily engaged in operating and/or providing access
to transmission facilities and infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired telecommunications networks. Transmission
facilities may be based on a single technology or a combination of technologies."258 For these
services, the Commission uses the SBA small business size standard for the category "Wireless
Telecommunications Carriers (except satellite)," which is 1,500 or fewer employees.259 To gauge
small business prevalence for these cable services we must, however, use the most current census
data. Census data for 2007 shows that there were 1,383 firms that operated that year.260 Of those
1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100 employees. Thus
under this category and the associated small business size standard, the majority of firms can be
considered small. The Commission notes that the Census' use the classifications "firms" does
not track the number of "licenses".


255 Id. at 8296.
256 Auction of Broadband Radio Service Licenses Closes, Winning Bidders Announced for Auction 86, Down
Payments Due November 23, 2009, Final Payments Due December 8, 2009, Ten-Day Petition to Deny Period
,
Public Notice, 24 FCC Rcd 13572 (2009).
257 The term "small entity" within SBREFA applies to small organizations (nonprofits) and to small governmental
jurisdictions (cities, counties, towns, townships, villages, school districts, and special districts with populations of
less than 50,000). 5 U.S.C. 601(4)(6). We do not collect annual revenue data on EBS licensees.
258 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers, (partial definition),
www.census.gov/naics/2007/def/ND517110.HTM#N517110.
259 13 C.F.R. 121.201, NAICS code 517210.
260 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
37

Federal Communications Commission

FCC 11-151

92.
In the 1998 and 1999 LMDS auctions,261 the Commission defined a small business
as an entity that has annual average gross revenues of less than $40 million in the previous three
calendar years.262 Moreover, the Commission added an additional classification for a "very small
business," which was defined as an entity that had annual average gross revenues of less than
$15 million in the previous three calendar years.263 These definitions of "small business" and
"very small business" in the context of the LMDS auctions have been approved by the SBA.264
In the first LMDS auction, 104 bidders won 864 licenses. Of the 104 auction winners, 93
claimed status as small or very small businesses. In the LMDS re-auction, 40 bidders won 161
licenses. Based on this information, the Commission believes that the number of small LMDS
licenses will include the 93 winning bidders in the first auction and the 40 winning bidders in the
re-auction, for a total of 133 small entity LMDS providers as defined by the SBA and the
Commission's auction rules.
93.
218-219 MHz Service. The first auction of 218-219 MHz spectrum resulted in
174 entities winning licenses for 594 Metropolitan Statistical Area ("MSA") licenses. Of the
594 licenses, 567 were won by 167 entities qualifying as a small business. For that auction, the
small business size standard was an entity that, together with its affiliates, has no more than a $6
million net worth and, after federal income taxes (excluding any carry over losses), has no more
than $2 million in annual profits each year for the previous two years.265 In the 218-219 MHz
Report and Order and Memorandum Opinion and Order
, the Commission established a small
business size standard for a "small business" as an entity that, together with its affiliates and
persons or entities that hold interests in such an entity and their affiliates, has average annual
gross revenues not to exceed $15 million for the preceding three years.266 A "very small
business" is defined as an entity that, together with its affiliates and persons or entities that hold
interests in such an entity and its affiliates, has average annual gross revenues not to exceed $3
million for the preceding three years.267 These size standards will be used in future auctions of
218-219 MHz spectrum.
94.
24 GHz Incumbent Licensees. This analysis may affect incumbent licensees
who were relocated to the 24 GHz band from the 18 GHz band, and applicants who wish to
provide services in the 24 GHz band. For this service, the Commission uses the SBA small
business size standard for the category "Wireless Telecommunications Carriers (except


261 The Commission has held two LMDS auctions: Auction 17 and Auction 23. Auction No. 17, the first LMDS
auction, began on February 18, 1998, and closed on March 25, 1998. (104 bidders won 864 licenses.) Auction No.
23, the LMDS re-auction, began on April 27, 1999, and closed on May 12, 1999. (40 bidders won 161 licenses.)
262 See LMDS Order, 12 FCC Rcd at 12545.
263 Id.
264 See Letter to Daniel Phythyon, Chief, Wireless Telecommunications Bureau (FCC) from A. Alvarez,
Administrator, SBA (January 6, 1998).
265 Implementation of Section 309(j) of the Communications Act Competitive Bidding, PP Docket No. 93-253,
Fourth Report and Order, 9 FCC Rcd 2330 (1994).
266 Amendment of Part 95 of the Commission's Rules to Provide Regulatory Flexibility in the 218-219 MHz Service,
WT Docket No. 98-169, Report and Order and Memorandum Opinion and Order, 15 FCC Rcd 1497 (1999) (" 218-
219 MHz Report and Order and Memorandum Opinion and Order
").
267 Id.
38

Federal Communications Commission

FCC 11-151

satellite)," which is 1,500 or fewer employees.268 To gauge small business prevalence for these
cable services we must, however, use the most current census data. Census data for 2007 shows
that there were 1,383 firms that operated that year.269 Of those 1,383, 1,368 had fewer than 100
employees, and 15 firms had more than 100 employees. Thus under this category and the
associated small business size standard, the majority of firms can be considered small. The
Commission notes that the Census' use of the classifications "firms" does not track the number
of "licenses". The Commission believes that there are only two licensees in the 24 GHz band
that were relocated from the 18 GHz band, Teligent270 and TRW, Inc. It is our understanding that
Teligent and its related companies have less than 1,500 employees, though this may change in
the future. TRW is not a small entity. Thus, only one incumbent licensee in the 24 GHz band is
a small business entity.
95.
24 GHz Future Licensees. With respect to new applicants in the 24 GHz band,
the small business size standard for "small business" is an entity that, together with controlling
interests and affiliates, has average annual gross revenues for the three preceding years not in
excess of $15 million.271 "Very small business" in the 24 GHz band is an entity that, together
with controlling interests and affiliates, has average gross revenues not exceeding $3 million for
the preceding three years.272 The SBA has approved these small business size standards.273
These size standards will apply to the future auction, if held.
96.
Satellite Telecommunications Providers. Two economic census categories
address the satellite industry. The first category has a small business size standard of $15 million
or less in average annual receipts, under SBA rules.274 The second has a size standard of $25
million or less in annual receipts.275
97.
The category of Satellite Telecommunications "comprises establishments
primarily engaged in providing telecommunications services to other establishments in the
telecommunications and broadcasting industries by forwarding and receiving communications
signals via a system of satellites or reselling satellite telecommunications."276 Census Bureau
data for 2007 show that 512 Satellite Telecommunications firms that operated for that entire


268 13 C.F.R. 121.201, NAICS code 517210.
269 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
270 Teligent acquired the DEMS licenses of FirstMark, the only licensee other than TRW in the 24 GHz band whose
license has been modified to require relocation to the 24 GHz band.
271 Amendments to Parts 1, 2, 87 and 101 of the Commission's Rules to License Fixed Services at 24 GHz, WT
Docket No. 99-327, Report and Order, 15 FCC Rcd 16934, 16967 77 (2000); see also 47 C.F.R. 101.538(a)(2).
272 Id.; see also 47 C.F.R. 101.538(a)(1).
273 See Letter to Margaret W. Wiener, Deputy Chief, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, FCC, from Gary M. Jackson, Assistant Administrator, SBA (July 28, 2000).
274 13 C.F.R. 121.201, NAICS code 517410.
275 13 C.F.R. 121.201, NAICS code 517919.
276 U.S. Census Bureau, 2007 NAICS Definitions, 517410 Satellite Telecommunications.
39

Federal Communications Commission

FCC 11-151

year.277 Of this total, 464 firms had annual receipts of under $10 million, and 18 firms had
receipts of $10 million to $24,999,999.278 Consequently, the Commission estimates that the
majority of Satellite Telecommunications firms are small entities that might be affected by our
action.
98.
The second category, i.e. "All Other Telecommunications" comprises
"establishments primarily engaged in providing specialized telecommunications services, such as
satellite tracking, communications telemetry, and radar station operation. This industry also
includes establishments primarily engaged in providing satellite terminal stations and associated
facilities connected with one or more terrestrial systems and capable of transmitting
telecommunications to, and receiving telecommunications from, satellite systems.
Establishments providing Internet services or voice over Internet protocol (VoIP) services via
client-supplied telecommunications connections are also included in this industry."279 For this
category, Census Bureau data for 2007 shows that there were a total of 2,383 firms that operated
for the entire year.280 Of this total, 2,347 firms had annual receipts of under $25 million and 12
firms had annual receipts of $25 million to $49, 999,999.281 Consequently, the Commission
estimates that the majority of All Other Telecommunications firms are small entities that might
be affected by our action.
e.

Cable and OVS Operators

99.
Because Section 706 requires us to monitor the deployment of broadband
regardless of technology or transmission media employed, the Commission anticipates that some
broadband service providers may not provide telephone service. Accordingly, the Commission
describes below other types of firms that may provide broadband services, including cable
companies, MDS providers, and utilities, among others.
100.
Cable and Other Program Distributors. Since 2007, these services have been
defined within the broad economic census category of Wired Telecommunications Carriers; that
category is defined as follows: "This industry comprises establishments primarily engaged in
operating and/or providing access to transmission facilities and infrastructure that they own
and/or lease for the transmission of voice, data, text, sound, and video using wired
telecommunications networks. Transmission facilities may be based on a single technology or a
combination of technologies."282 The SBA has developed a small business size standard for this
category, which is: all such firms having 1,500 or fewer employees. Census data for 2007


277 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
278 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
279 http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517919&search=2007%20NAICS%20Search.
280 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
281http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&-ds_name=EC0751SSSZ4&;-
_lang=en.
282 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers, (partial definition),
http://www.census.gov/naics/2007/def/ND517110.HTM#N517110 (last visited Oct. 21, 2009).
40

Federal Communications Commission

FCC 11-151

shows that there were 1,383 firms that operated that year.283 Of those 1,383, 1,368 had fewer
than 100 employees, and 15 firms had more than 100 employees. Thus under this category and
the associated small business size standard, the majority of such firms can be considered small.
101.
Cable Companies and Systems. The Commission has also developed its own
small business size standards, for the purpose of cable rate regulation. Under the Commission's
rules, a "small cable company" is one serving 400,000 or fewer subscribers, nationwide.284
Industry data indicate that, of 1,076 cable operators nationwide, all but eleven are small under
this size standard.285 In addition, under the Commission's rules, a "small system" is a cable
system serving 15,000 or fewer subscribers.286 Industry data indicate that, of 6,635 systems
nationwide, 5,802 systems have under 10,000 subscribers, and an additional 302 systems have
10,000-19,999 subscribers.287 Thus, under this second size standard, most cable systems are
small.
102.
Cable System Operators. The Communications Act of 1934, as amended, also
contains a size standard for small cable system operators, which is "a cable operator that, directly
or through an affiliate, serves in the aggregate fewer than 1 percent of all subscribers in the
United States and is not affiliated with any entity or entities whose gross annual revenues in the
aggregate exceed $250,000,000."288 The Commission has determined that an operator serving
fewer than 677,000 subscribers shall be deemed a small operator, if its annual revenues, when
combined with the total annual revenues of all its affiliates, do not exceed $250 million in the
aggregate.289 Industry data indicate that, of 1,076 cable operators nationwide, all but ten are
small under this size standard.290 We note that the Commission neither requests nor collects
information on whether cable system operators are affiliated with entities whose gross annual


283 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
284 47 C.F.R. 76.901(e). The Commission determined that this size standard equates approximately to a size
standard of $100 million or less in annual revenues. Implementation of Sections of the 1992 Cable Act: Rate
Regulation,
Sixth Report and Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393, 7408 (1995).
285 These data are derived from: R.R. BOWKER, BROADCASTING & CABLE YEARBOOK 2006, TOP 25
CABLE/SATELLITE OPERATORS, pages A-8 & C-2 (data current as of June 30, 2005); WARREN COMMUNICATIONS
NEWS, TELEVISION & CABLE FACTBOOK 2006, OWNERSHIP OF CABLE SYSTEMS IN THE UNITED STATES, pages D-
1805 to D-1857.
286 47 C.F.R. 76.901(c).
287 WARREN COMMUNICATIONS NEWS, TELEVISION & CABLE FACTBOOK 2008, U.S. CABLE SYSTEMS BY
SUBSCRIBER SIZE, page F-2 (data current as of Oct. 2007). The data do not include 851 systems for which
classifying data were not available.
288 47 U.S.C. 543(m)(2); see 47 C.F.R. 76.901(f) & nn. 13.
289 47 C.F.R. 76.901(f); see, FCC Announces New Subscriber Count for the Definition of Small Cable Operator,
Public Notice, 16 FCC Rcd 2225 (Cable Services Bureau 2001).
290 See BROADCASTING & CABLE YEARBOOK 2006, at A-8, C-2 (Harry A. Jessell ed., 2005) (data current as of June
30, 2005); TELEVISION & CABLE FACTBOOK 2006, at D-805 to D-1857 (Albert Warren ed., 2005).
41

Federal Communications Commission

FCC 11-151

revenues exceed $250 million,291 and therefore we are unable to estimate more accurately the
number of cable system operators that would qualify as small under this size standard.
103.
Open Video Services. Open Video Service (OVS) systems provide subscription
services.292 The open video system ("OVS") framework was established in 1996, and is one of
four statutorily recognized options for the provision of video programming services by local
exchange carriers.293 The OVS framework provides opportunities for the distribution of video
programming other than through cable systems. Because OVS operators provide subscription
services,294 OVS falls within the SBA small business size standard covering cable services,
which is "Wired Telecommunications Carriers."295 The SBA has developed a small business size
standard for this category, which is: all such firms having 1,500 or fewer employees. To gauge
small business prevalence for the OVS service, the Commission relies on data currently available
from the U.S. Census for the year 2007. According to that source, there were 3,188 firms that in
2007 were Wired Telecommunications Carriers. Of these, 3,144 operated with less than 1,000
employees, and 44 operated with more than 1,000 employees. However, as to the latter 44 there
is no data available that shows how many operated with more than 1,500 employees. Based on
this data, the majority of these firms can be considered small.296 In addition, we note that the
Commission has certified some OVS operators, with some now providing service.297 Broadband
service providers ("BSPs") are currently the only significant holders of OVS certifications or
local OVS franchises.298 The Commission does not have financial or employment information
regarding the entities authorized to provide OVS, some of which may not yet be operational.
Thus, at least some of the OVS operators may qualify as small entities. The Commission further
notes that it has certified approximately 45 OVS operators to serve 75 areas, and some of these
are currently providing service.299 Affiliates of Residential Communications Network, Inc.
(RCN) received approval to operate OVS systems in New York City, Boston, Washington, D.C.,
and other areas. RCN has sufficient revenues to assure that they do not qualify as a small
business entity. Little financial information is available for the other entities that are authorized
to provide OVS and are not yet operational. Given that some entities authorized to provide OVS
service have not yet begun to generate revenues, the Commission concludes that up to 44 OVS


291 The Commission does receive such information on a case-by-case basis if a cable operator appeals a local
franchise authority's finding that the operator does not qualify as a small cable operator pursuant to 76.901(f) of
the Commission's rules. See 47 C.F.R. 76.909(b).
292 See 47 U.S.C. 573.
293 47 U.S.C. 571(a)(3)-(4). See 13th Annual Report, 24 FCC Rcd at 606, 135.
294 See 47 U.S.C. 573.
295 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers,
http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
296 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
297 A list of OVS certifications may be found at http://www.fcc.gov/mb/ovs/csovscer.html.
298 See 13th Annual Report, 24 FCC Rcd at 606-07 135. BSPs are newer firms that are building state-of-the-art,
facilities-based networks to provide video, voice, and data services over a single network.
299 See http://www.fcc.gov/mb/ovs/csovscer.html (current as of February 2007).
42

Federal Communications Commission

FCC 11-151

operators (those remaining) might qualify as small businesses that may be affected by the rules
and policies adopted herein.
f.

Internet Service Providers, Web Portals and Other
Information Services

104.
Internet Service Providers, Web Portals and Other Information Services. In 2007,
the SBA recognized two new small business economic census categories. They are (1) Internet
Publishing and Broadcasting and Web Search Portals,300 and (2) All Other Information
Services.301
105.
Internet Service Providers. The 2007 Economic Census places these firms,
whose services might include voice over Internet protocol (VoIP), in either of two categories,
depending on whether the service is provided over the provider's own telecommunications
facilities (e.g., cable and DSL ISPs), or over client-supplied telecommunications connections
(e.g., dial-up ISPs). The former are within the category of Wired Telecommunications
Carriers,302 which has an SBA small business size standard of 1,500 or fewer employees.303
These are also labeled "broadband." The latter are within the category of All Other
Telecommunications,304 which has a size standard of annual receipts of $25 million or less.305
These are labeled non-broadband.
106.
The most current Economic Census data for all such firms are 2007 data, which
are detailed specifically for ISPs within the categories above. For the first category, the data
show that 396 firms operated for the entire year, of which 159 had nine or fewer employees.306
For the second category, the data show that 1,682 firms operated for the entire year.307 Of those,
1,675 had annual receipts below $25 million per year, and an additional two had receipts of
between $25 million and $ 49,999,999. Consequently, we estimate that the majority of ISP firms
are small entities.
107.
Internet Publishing and Broadcasting and Web Search Portals. This industry
comprises establishments primarily engaged in 1) publishing and/or broadcasting content on the
Internet exclusively or 2) operating Web sites that use a search engine to generate and maintain
extensive databases of Internet addresses and content in an easily searchable format (and known


300 13 C.F.R. 121.201, NAICS code 519130 (establishing a $500,000 revenue ceiling).
301 13 C.F.R. 121.201, NAICS code 519190 (establishing a $6.5 million revenue ceiling).
302 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers,
http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
303 13 C.F.R. 121.201, NAICS code 517110.
304 U.S. Census Bureau, 2007 NAICS Definitions, "517919 All Other Telecommunications,"
http://www.census.gov/naics/2007/def/ND517919.HTM#N517919.
305 13 C.F.R. 121.201, NAICS code 517919 (updated for inflation in 2008).
306 U.S. Census Bureau, 2007 Economic Census, Subject Series: Information, "Establishment and Firm Size,"
NAICS code 5171103 (rel. Nov. 19, 2010) (employment size). The data show only two categories within the whole:
the categories for 1-4 employees and for 5-9 employees.
307 U.S. Census Bureau, 2007 Economic Census, Subject Series: Information, "Establishment and Firm Size,"
NAICS code 5179191 (rel. Nov. 19, 2010) (receipts size).
43

Federal Communications Commission

FCC 11-151

as Web search portals). The publishing and broadcasting establishments in this industry do not
provide traditional (non-Internet) versions of the content that they publish or broadcast. They
provide textual, audio, and/or video content of general or specific interest on the Internet
exclusively. Establishments known as Web search portals often provide additional Internet
services, such as e-mail, connections to other web sites, auctions, news, and other limited
content, and serve as a home base for Internet users. 308 The SBA deems businesses in this
industry with 500 or fewer employees small.309 According to Census Bureau data for 2007, there
were 2,705 firms that provided one or more of these services for that entire year. Of these, 2,682
operated with less than 500 employees and 13 operated with to 999 employees.310 Consequently,
we estimate the majority of these firms are small entities that may be affected by our proposed
actions.
108.
Data Processing, Hosting, and Related Services. This industry comprises
establishments primarily engaged in providing infrastructure for hosting or data processing
services. These establishments may provide specialized hosting activities, such as web hosting,
streaming services or application hosting; provide application service provisioning; or may
provide general time-share mainframe facilities to clients. Data processing establishments
provide complete processing and specialized reports from data supplied by clients or provide
automated data processing and data entry services.311 The SBA has developed a small business
size standard for this category; that size standard is $25 million or less in average annual
receipts.312 According to Census Bureau data for 2007, there were 8,060 firms in this category
that operated for the entire year.313 Of these, 6,726 had annual receipts of under $25 million, and
155 had receipts between $25 million and $49,999,999 million.314 Consequently, we estimate
that the majority of these firms are small entities that may be affected by our proposed actions.
109.
All Other Information Services. "This industry comprises establishments
primarily engaged in providing other information services (except new syndicates and libraries
and archives)."315 Our action pertains to interconnected VoIP services, which could be provided
by entities that provide other services such as e-mail, online gaming, web browsing, video
conferencing, instant messaging, and other, similar IP-enabled services. The SBA has developed
a small business size standard for this category; that size standard is $7.0 million or less in


308 http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=519130&search=2007%20NAICS%20Search
309 http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf.
310 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=1000&-ds_name=EC0751SSSZ5&;-
_lang=en.
311 U.S. Census Bureau, 2007 NAICS Definitions, "518210 Data Processing, Hosting, and Related Services";
http://www.census.gov/naics/2007/def/ND518210.HTM#N518210.
312 13 C.F.R. 121.201, NAICS code 518210.
313 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=1000&-ds_name=EC0751SSSZ4&;-
_lang=en .
314 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=1000&-ds_name=EC0751SSSZ4&;-
_lang=en.
315 U.S. Census Bureau, "2002 NAICS Definitions: 519190 All Other Information Services";
http://www.census.gov/epcd/naics02/def/NDEF519.HTM.
44

Federal Communications Commission

FCC 11-151

average annual receipts.316 According to Census Bureau data for 2007, there were 367 firms in
this category that operated for the entire year.317 Of these, 334 had annual receipts of under $5
million, and an additional 11 firms had receipts of between $5 million and $9,999,999.318
Consequently, we estimate that the majority of these firms are small entities that may be affected
by our action.

E.

Description of Projected Reporting, Recordkeeping, and Other Compliance
Requirements

110.
We summarize below the recordkeeping and certification obligations of the
Report and Order. Additional information on each of these requirements can be found in the
Report and Order. Again, the Report and Order temporarily exempts all providers of ACS and
manufacturers of ACS equipment that qualify as small business concerns under the SBA's rules
and size standards for the industry in which they are primarily engaged.
111.
Recordkeeping. The Report and Order requires, beginning one year after the
effective date of the Report and Order, that each manufacturer of equipment used to provide
ACS and each provider of such services subject to Sections 255, 716, and 718 not otherwise
exempt under the Report and Order, maintain certain records. These records document the
efforts taken by a manufacturer or service provider to implement Sections 255, 716, and 718.
The Report and Order adopts the recordkeeping requirements of the CVAA, which specifically
include: (1) information about the manufacturer's or provider's efforts to consult with individuals
with disabilities; (2) descriptions of the accessibility features of its products and services; and (3)
information about the compatibility of such products and services with peripheral devices or
specialized customer premise equipment commonly used by individuals with disabilities to
achieve access. Additionally, while manufacturers and providers are not required to keep
records of their consideration of the four achievability factors, they must be prepared to carry
their burden of proof, which requires greater than conclusory or unsupported claims. Similarly,
entities that rely on third party solutions to achieve accessibility must be prepared to produce
relevant documentation.
112.
These recordkeeping requirements are necessary to facilitate enforcement of the
rules adopted in the Report and Order. The Report and Order builds flexibility into the
recordkeeping obligations by allowing covered entities to keep records in any format,
recognizing the unique recordkeeping methods of individual entities. Because complaints
regarding accessibility of a product or service may not occur for years after the release of the
product or service, the Report and Order requires covered entities to keep records for two years
from the date the product ceases to be manufactured or a service is offered to the public.
113.
Annual Certification Obligations. The CVAA and the Report and Order require
an officer of providers of ACS and ACS equipment to submit to the Commission an annual
certificate that records are kept in accordance with the above recordkeeping requirements, unless


316 13 C.F.R. 121.201, NAICS code 519190. See also
http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf
317 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=1200&-ds_name=EC0751SSSZ4&;-
_lang=en.
318 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=1100&-ds_name=EC0751SSSZ4&;-
_lang=en.
45

Federal Communications Commission

FCC 11-151

such manufacturer or provider is exempt from compliance with Section 716 under applicable
rules.319 The certification must be supported with an affidavit or declaration under penalty of
perjury, signed and dated by an authorized officer of the entity with personal knowledge of the
representations provided in the company's certification, verifying the truth and accuracy of the
information. The certification must be filed with the Consumer and Governmental Affairs
Bureau on or before April 1 each year for records pertaining to the previous calendar year.
114.
Costs of Compliance. There is an upward limit on the cost of compliance for
covered entities. Under the CVAA and Report and Order accessibility is required unless it is not
achievable. Under two of the four achievability factors from the Act and adopted in the Report
and Order
, covered entities may demonstrate that accessibility is not achievable based on the
nature and cost of steps needed or the technical and economic impact on the entity's operation.320
Entities that are not otherwise exempt or excluded under the Report and Order must nonetheless
be able to demonstrate that they conducted an achievability analysis, which necessarily requires
the retention of some records. As discussed, the Report and Order contains a temporary
exemption for small entities from compliance with Section 716 and Section 717, allows for
waivers of the obligations of Section 716 and Section 717, and excludes customized equipment
from the obligations of Section 716 and Section 717.

F.

Steps Taken to Minimize Significant Economic Impact on Small Entities and
Significant Alternatives Considered

115.
The RFA requires an agency to describe any significant alternatives it considered
in developing its approach, which may include the following four alternatives, among others:
"(1) the establishment of differing compliance or certification requirements or timetables that
take into account the resources available to small entities; (2) the clarification, consolidation, or
simplification of compliance and certification requirements under the rule for such small entities;
(3) the use of performance rather than design standards; and (4) an exemption from coverage of
the rule, or any part thereof, for such small entities."321
116.
For rules adopted that impose some burden on small entities, the Commission
considered alternatives where possible, as directed by the RFA. Most significantly, the
Commission considered and adopted a temporary exemption for all small entities that qualify as
small business concerns under the SBA's rules and size standards. Therefore, while some of the
obligations of the Report and Order do impose a burden, small entities are generally relieved of
these burdens. The rules we adopt in the Report and Order also promotes flexibility for entities
that do not meet the small entity exemption. All entities may avoid compliance if accessibility is
not achievable, may seek a waiver for products or services that are not designed primarily for
ACS, and may keep records in any format. Further, in the accompanying Further Notice the
Commission seeks comment on extending a permanent exemption for small entities. Despite this
flexibility and the exemption for qualifying small entities, we discuss below the alternatives
considered for rules that may impose a burden on small entities.
117.
The rules require covered entities to ensure that products and services are
accessible, unless not achievable. This is a statutory requirement, therefore no alternatives were


319 47 U.S.C. 618(a)(5)(B).
320 See 47 U.S.C. 617(g).
321 5 U.S.C. 603(c)(1)-(c)(4).
46

Federal Communications Commission

FCC 11-151

considered. However, this requirement has built-in flexibility. All entities may demonstrate that
accessibility is unachievable either through building accessibility features into the product or
service or by utilizing third party solutions. Achievability is determined through a four factor
analysis that examines: The nature and cost of the steps needed to meet the requirements of
Section 716(g) with respect to the specific equipment or service in question; the technical and
economic impact on the operation of the manufacturer or provider and on the operation of the
specific equipment or service in question, including on the development and deployment of new
communications technologies; the type of operations of the manufacturer or provider; the extent
to which the service provider or manufacturer in question offers accessible services or equipment
containing varying degrees of functionality and features, and offered at differing price points.
Through this analysis, an otherwise covered entity can demonstrate that accessibility is not
achievable. We note that two of the four factors look at factors that are particularly relevant to
small entities: the nature and cost of the steps need to meet the Section 716 requirements and the
technical and economic impact on the entity's operations. Therefore, as explained further below,
this achievability analysis provides a statutorily based means of minimizing the economic impact
of the CVAA's requirements on small entities. Further, when accessibility is not achievable,
covered entities must ensure that their products and services are compatible, unless not
achievable. This again is a statutory requirement with built-in flexibility though the achievability
analysis.
118.
The rules require covered entities to consider performance objectives at the design
stage as early and consistently as possible. This requirement is necessary to ensure that
accessibility is considered at the point where it is logically best to incorporate accessibility. The
CVAA and the Report and Order are naturally performance-driven. The CVAA and Report and
Order
avoid mandating particular designs and instead focus on an entity's compliance with the
accessibility requirements through whatever means the entity finds necessary to make its product
or service accessible, unless not achievable. This provides flexibility by allowing all entities,
including small entities, to meet their obligations through the best means for a given entity
instead of the Commission explicitly mandating a rigid requirement.
119.
With respect to recordkeeping and certification requirements, these requirements
are necessary in order to demonstrate compliance with the requirements of the Report and Order
and CVAA and to facilitate an effective and efficient complaint process. As described above, we
adopt flexible requirements that allow covered entities to keep records in any format they wish.
In the Report and Order, we found that this approach took into account the variances in covered
entities (e.g., size, experience with the Commission), recordkeeping methods, and products and
services covered by the CVAA. Moreover, we found that it also provided the greatest flexibility
to small businesses and minimized the impact that the statutorily mandated requirements impose
on small businesses. Correspondingly, we considered and rejected the alternative of imposing a
specific format or one-size-fits-all system for recordkeeping that could potentially impose greater
burdens on small businesses. Furthermore, the certification requirement is possibly less
burdensome on small businesses than large, as it merely requires certification from an officer
that the necessary records were kept over the previous year; this is presumably a less resource
intensive certification for smaller entities.
120.
While ensuring accessibility and keeping records may impose some burdens, as
discussed, the Report and Order includes significant flexibility for small entities. First, the
achievability factors in the CVAA may mitigate adverse impacts and reduce burdens on small
entities. Under the achievability factors as discussed above, an otherwise covered entity can
47

Federal Communications Commission

FCC 11-151

demonstrate that accessibility is unachievable and therefore avoid compliance. The first and
second factors are particularly relevant to small entities and the special circumstances they face.
The first factor considers the nature and cost of the steps needed to meet the requirements with
respect to the specific equipment or service in question, and the second considers the technical
and economic impact on the operation of the manufacturer or provider and on the operation of
the specific equipment or service in question. If achievability is overly expensive or has some
significant negative technical or economic impact on a covered entity, the entity can show that
accessibility was not achievable as a defense to a complaint.
121.
The Report and Order also includes significant relief for small and other entities
including a temporary exemption from the obligations of Section 716 and Section 717 for
qualifying small entities, waiver criteria under which all covered entities may seek a waiver of
the obligations of Section 716, and an exemption for customized equipment. Under the Report
and Order
, customized equipment offered to businesses and other enterprise customers is
expressly exempt. Additionally, all providers and manufacturers, or classes of providers and
manufactures, are able to seek a waiver for equipment or services that are capable of accessing
ACS. These two provisions allow any entity, including small entities, to avoid the burden of
compliance with the accessibility and recordkeeping requirements if they meet the requirements
for either provision.
122.
Further, while we could have opted to not exercise our discretionary authority to
exempt small entities, we found that even in the absence of meaningful comments regarding
whether to grant a permanent small entity exemption, there was good cause to provide temporary
relief and avoid imposing an unreasonable burden upon small entities and negatively impacting
the value they add to the economy. In the Report and Order, we therefore decided some
exemption is necessary to provide relief to those entities for which even conducting an
achievability analysis would consume an unreasonable amount of resources. Finding good cause
for granting such relief, the Report and Order temporarily exempts ACS providers and ACS
equipment manufacturers that qualify as small business concerns under the SBA's rules and size
standards.
123.
Specifically, the Report and Order temporarily exempts entities that manufacture
ACS equipment or provide ACS that, along with any affiliates, meet the criteria for a small
business concern for their primary industry under SBA's rules and size standards.322 A small
business concern, as defined by the SBA, is an "entity organized for profit, with a place of
business located in the United States, and which operates primarily within the United States or
which makes a significant contribution to the U.S. economy through payment of taxes or use of
American products, materials or labor."323 Entities are affiliated under the SBA's rules when an
entity has the power to control another entity, or a third party has the power to control both
entities,324 as determined by factors including "ownership, management, previous relationships
with or ties to another concern, and contractual relationships."325 A concern's primary industry is
determined by the "distribution of receipts, employees and costs of doing business among the


322 13 C.F.R. 121.101 121.201.
323 13 C.F.R. 121.105(a)(1).
324 13 C.F.R. 121.103(a)(1).
325 13 C.F.R. 121.103(a)(2).
48

Federal Communications Commission

FCC 11-151

different industries in which business operations occurred for the most recently completed fiscal
year,"326 and other factors including "distribution of patents, contract awards, and assets."327 The
Report and Order stated that if an entity no longer meets the exemption criteria, it must comply
with Section 716 and Section 717 for all subsequent products or services or substantial upgrades
of products or services that are in the development phase of the product or service lifecycle, or
any earlier stages of development, at the time they no longer meet the criteria. The temporary
exemption will begin on the effective date of the rules adopted in the Report and Order328 and
will expire the earlier of the effective date of small entity exemption rules adopted pursuant to
the Further Notice of Proposed Rulemaking ("Further Notice") or October 8, 2013.
124.
This exemption enables us to provide relief to those entities that may possibly
lack legal, financial, or technical capability to comply with the Act until we further develop the
record to determine whether small entities should be subject to a permanent exemption and, if so,
the criteria to be used for defining which small entities should be subject to such permanent
exemption. To that end, we seek further comment on the standards for a permanent exemption in
the accompanying Further Notice.

G.

Federal Rules that May Duplicate, Overlap, or Conflict with Proposed Rules

Section 255(e) of the Act, as amended, directs the United States Access Board ("Access Board")
to develop equipment accessibility guidelines "in conjunction with" the Commission, and
periodically to review and update those guidelines.329 We view the Access Board's current
guidelines as well as its draft guidelines330 as starting points for our interpretation and
implementation of Sections 716 and 717 of the Act, as well as Section 255, but because they do
not currently cover ACS or equipment used to provide or access ACS, we must necessarily adapt
these guidelines in our comprehensive implementation scheme. As such, our rules do not
overlap, duplicate, or conflict with either Access Board Final Rules,331 or (if later adopted) the
Access Board Draft Guidelines. Where obligations under Section 255 and Section 716 overlap,
for instance for accessibility requirements for interconnected VoIP, we clarify in the Report and
Order
which rules govern the entities' obligations.


326 13 C.F.R. 121.107.
327 13 C.F.R. 121.107.
328 See accompanying Report and Order at Section III.A.5.
329 47 U.S.C. 255(e).
330 United States Access Board, Draft Information and Communication Technology (ICT) Standards and Guidelines,
(March 2010), ("Access Board Draft Guidelines"), http://www.access-board.gov/sec508/refresh/draft-rule.pdf.
331 See Part 1193 of the Access Board Rules, 36 C.F.R. Part 1193.
49

Federal Communications Commission

FCC 11-151

APPENDIX E

Initial Regulatory Flexibility Analysis

1. As required by the Regulatory Flexibility Act of 1980, as amended ("RFA"),1
the Commission has prepared this present Initial Regulatory Flexibility Analysis
("IRFA") of the possible significant economic impact on a substantial number of small
entities that might result from adoption of the rules proposed in the Further Notice of
Proposed Rulemaking ("Further Notice"). Written public comments are requested on
this IRFA. Comments must be identified as responses to the IRFA and must be filed by
the applicable deadlines for initial comments, or reply comments, as specified in the
Further Notice. The Commission will send a copy of the Further Notice, including this
IRFA, to the Chief Counsel for Advocacy of the Small Business Administration
("SBA").2 In addition, the Further Notice and this IRFA (or summaries thereof) will be
published in the Federal Register.3

A.

Need for, and Objectives of, the Proposed Rules

2.
The accompanying Report and Order implements Congress' mandate that
people with disabilities have access to advanced communications services ("ACS") and
ACS equipment. Specifically, the rules adopted in the Report and Order implement
Sections 716 and 717 of the Communications Act of 1934, as amended, which were
added by the "Twenty-First Century Communications and Video Accessibility Act of
2010" ("CVAA").4
3.
The accompanying Report and Order implements the requirements of
Section 716 of the Act, which requires providers of ACS and manufacturers of equipment
used for ACS to make their products accessible to people with disabilities, unless
accessibility is not achievable.5 The Commission also adopts rules to implement Section
717 of the Act, which requires the Commission to establish new recordkeeping and
enforcement procedures for manufacturers and providers subject to Sections 255, 716,
and 718.6
4.
The accompanying Report and Order finds the record insufficient to adopt
a permanent exemption or to adopt the criteria to be used to determine which small
entities to exempt. The Report and Order therefore temporarily exempts all
manufacturers of ACS equipment and all providers of ACS from the obligations of
Section 716 if they qualify as small business concerns under the SBA rules and size


1 See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601-12, has been amended by the Small Business
Regulatory Enforcement Fairness Act of 1996 (SBREFA), Pub. L. No. 104-121, 110 Stat. 857 (1996).
2 See 5 U.S.C. 603(a).
3 Id.
4 Pub. L. No. 111-260, 104.
5 See 47 U.S.C. 617.
6 See 47 U.S.C. 618.

Federal Communications Commission

FCC 11-151

standards for the industry in which they are primarily engaged. The Report and Order
indicated that such an exemption was necessary to avoid the possibility of unreasonably
burdening "small and entrepreneurial innovators and the significant value that they add to
the economy." This self-executing exemption would be applied until the development of
a record to determine whether small entities should be permanently exempted and, if so,
what criteria should be used to define small entities.7
5.
The Report and Order indicated that SBA has established maximum size
standards used to determine whether a business concern qualifies as a small business
concern in its primary industry.8 The SBA has generally adopted size standards based on
the maximum number of employees or maximum annual receipts of a business concern.9
The SBA categorizes industries for its size standards using the North American Industry
Classification System ("NAICS"), a "system for classifying establishments by type of
economic activity."10 The Report and Order identified some NAICS codes for possible
primary industry classifications of ACS equipment manufacturers and ACS providers and
the relevant SBA size standards associated with the codes.11

NAICS Classification12

NAICS Code

SBA Size Standard13

Wired Telecommunications Carriers
517110
1,500 or fewer
14
employees
Wireless Telecommunications Carriers
517210
1,500 or fewer
(except satellites)
employees

Services

Telecommunications Resellers
517911
1,500 or fewer


7 See 13 C.F.R. 121.201.
8 See 13 C.F.R. 121.201.
9 13 C.F.R. 121.106 (describing how number of employees is calculated); 13 C.F.R. 121.104
(describing how annual receipts is calculated).
10 North American Industry Classification System; Revision for 2012, 76 Fed. Reg. 51240 (Aug. 17, 2011)
("NAICS Final Decision").
11 This is not a comprehensive list of the primary industries and associated SBA size standards of every
possible manufacturer of ACS equipment or provider of ACS. This list is merely representative of some
primary industries in which entities that manufacture ACS equipment or provide ACS may be primarily
engaged. It is ultimately up to an entity seeking the temporary exemption to make a determination
regarding their primary industry, and justify such determination in any enforcement proceeding.
12 The definitions for each NAICS industry classification can be found by entering the six digit NAICS
code in the "2007 NAICS Search" function available at the NAICS homepage,
http://www.census.gov/eos/www/naics/index.html. The U.S. Office of Management and Budget has
revised NAICS for 2012, however, the codes and industry categories listed herein are unchanged. OMB
anticipates releasing a 2012 NAICS UNITED STATES MANUAL or supplement in January 2012. See NAICS
Final Decision
, 76 Fed. Reg. at 51240.
13 See 13 C.F.R. 121.201 for a full listing of SBA size standards by six-digit NAICS industry code. The
standards listed in this column establish the maximum size an entity in the given NAICS industry may be to
qualify as a small business concern.
2

Federal Communications Commission

FCC 11-151

employees
All Other Telecommunications
517919
$25 million or less in
annual receipts
Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
Data Processing, Hosting, and Related
518210
$25 million or less in
Services
annual receipts
Radio and Television Broadcasting and
334220
750 or fewer
Wireless Communications Equipment
employees
Manufacturing
Electronic Computer Manufacturing
334111
1,000 or fewer
15
employees
Telephone Apparatus Manufacturing
334210
1,000 or fewer
employees
Other Communications Equipment
334290
750 or fewer

Equipment

Manufacturing
employees
Software Publishers
511210
$25 million or less in
annual receipts
Internet Publishing and Broadcasting and
519130
500 or fewer
Web Search Portals
employees
6.
The Report and Order indicated that this temporary exemption is self-
executing. Under this approach, covered entities must determine whether they qualify for
the exemption based upon their ability to meet the SBA's rules and the size standard for
the relevant NAICS industry category for the industry in which they are primarily
engaged. Entities that manufacture ACS equipment or provide ACS may raise this
temporary exemption as a defense in an enforcement proceeding. Entities claiming the
exemption must be able to demonstrate that they met the exemption criteria during the
estimated start of the design phase of the lifecycle of the product or service that is the
subject of the complaint. The Report and Order stated that if an entity no longer meets
the exemption criteria, it must comply with Section 716 and Section 717 for all
subsequent products or services or substantial upgrades of products or services that are in
the development phase of the product or service lifecycle, or any earlier stages of
development, at the time they no longer meet the criteria. The temporary exemption will
begin on the effective date of the rules adopted in the Report and Order16 and will expire
the earlier of the effective date of small entity exemption rules adopted pursuant to the
Further Notice or October 8, 2013. The Report and Order states that the temporary
(Continued from previous page)


14 See accompanying Report and Order at Section III.A.
15 See accompanying Report and Order at Section III.A.
16 See accompanying Report and Order at Section III.A.5.
3

Federal Communications Commission

FCC 11-151

exemption enables us to provide relief to those entities that may possibly lack legal,
financial, or technical capability to comply with the Act until we further develop the
record to determine whether small entities should be subject to a permanent exemption
and, if so, the criteria to be used for defining which small entities should be subject to
such permanent exemption.
7.
In the Further Notice we seek comment on whether to make permanent
the temporary exemption for manufacturers of ACS equipment and providers of ACS,
adopt one or part of alternative size standards the Commission adopted in other contexts,
or to adopt any permanent exemption for such entities, subject to repeal or modification
by the Commission as necessary to meet Congress's intent.17 The Further Notice also
seeks comment on the impact of an exemption on providers of ACS, manufacturers of
ACS equipment, and consumers.
8.
Specifically, the Further Notice seeks comment on whether to
permanently exempt from the obligations of Section 716, manufacturers of ACS
equipment and providers of ACS that qualify as small business concerns under the SBA's
rules and size standards and, if so, whether to utilize the size standards for the primary
industry in which they are engaged under the SBA's rules as set forth in the
accompanying Report and Order as explained above. The Further Notice notes that SBA
criteria were established for the purpose of determining eligibility for SBA small business
loans and asks whether these same criteria are appropriate for the purpose of relieving
covered entities from the obligations associated with achievability analyses,
recordkeeping, and certifications.
9.
The Further Notice also seeks comment on alternative size standards that
the Commission has adopted in other contexts. The Commission has adopted alternative
size standards for very small and small businesses for eligibility for spectrum bidding
credits. These alternative sizes include average gross revenue over the preceding three
years of $3 million, $15 million, or $40 million, depending on the wireless service. The
Commission has also used a different size standard in the spectrum context, specifically
for entities that, along with affiliates, have $6 million or less in net worth and no more
than $2 million in annual profits (after federal income tax and excluding carry over
losses) each year for the previous two years. The Commission has also used different
size standards to define small cable companies and small cable systems, and the Act
includes a definition of small cable system operators. The Commission has defined small
cable companies as a cable company serving 400,000 or fewer subscribers nationwide,
and small cable systems as a cable system serving 15,000 or fewer subscribers. The Act
defines small cable system operators as "a cable operator that, directly or through an
affiliate, serves in the aggregate fewer than 1 percent of all subscribers in the United
States and is not affiliated with any entity or entities whose gross annual revenues in the


17 See 156 CONG. REC. H7168, H7176 (2010) (statement of Rep. Burgess) ("This bill recognizes that some
small businesses and fledgling entrepreneurs may not be able to bear the financial burden of these new
requirements, so there is the possibility of exemptions for small businesses."). See also Report and Order
at Section III.C.3.
4

Federal Communications Commission

FCC 11-151

aggregate exceed $250,000,000."18 The Further Notice seeks comment on whether any
of these alternatives in whole, in part, or in combination should form the basis for a
permanent small entity exemption from the requirements of Section 716.
10.
The Further Notice also asks if these size criteria are not appropriate for a
permanent exemption, what the appropriate size criteria would be, and whether there are
other criteria that should form the basis of a permanent exemption?
11.
The Further Notice seeks comment on the impact of a permanent
exemption on providers of ACS, manufacturers of ACS equipment, and consumers.
Specifically, the Further Notice seeks comment on the qualitative and quantitative impact
of a permanent exemption based on the temporary exemption, on any of the alternatives
discussed, or on some other possible size standard will impact industry sectors engaged in
ACS. For example, what percentage of, or which non-interconnected VoIP providers,
wireline or wireless service providers, electronic messaging providers, and ACS
equipment manufacturers would qualify as small business concerns under each size
standard? Conversely, what percentage of or which providers of ACS or manufactures of
equipment used for ACS are not small business concerns under each size standard? For
each ACS and ACS equipment market segment, what percentage of the market is served
by entities that are not exempt using each size standard?
12.
The Further Notice also seeks comment on the compliance costs that ACS
providers and ACS equipment manufacturers would incur absent a permanent exemption.
What would the costs be for compliance with Section 716 and Section 717 across
different providers of ACS and ACS equipment manufacturers if we decline to adopt any
permanent exemption or decline to make the temporary exemption permanent? In
particular, what are the costs of conducting an achievability analysis, recordkeeping, and
providing certifications?
13.
We note that, in addition to the small entity exemption provision, the
CVAA sets forth achievability factors that may also mitigate adverse impacts and reduce
burdens on small entities. Under the achievability factors, an otherwise covered entity
can demonstrate that accessibility is unachievable and therefore avoid compliance. The
first and second factors are particularly relevant to small entities and the special
circumstances they face. The first factor considers the nature and cost of the steps needed
to meet the requirements with respect to the specific equipment or service in question,
and the second considers the technical and economic impact on the operation of the
manufacturer or provider and on the operation of the specific equipment or service in
question.
14.
The Further Notice seeks further comment on several issues raised in the
implementation of Section 716 and 717 of the Act, as well as to seek initial comment on
implementing Section 718 of the Act. Specifically, the Further Notice seeks comment on
three proposed alternative definitions for the term "interoperable" in the context of video
conferencing services and equipment used for those services: (1) "interoperable" means
able to function inter-platform, inter-network, and inter-provider; (2) "interoperable"


18 47 U.S.C. 543(m)(2).
5

Federal Communications Commission

FCC 11-151

means having published or otherwise agreed-upon standards that allow for manufacturers
or service providers to develop products or services that operate with other equipment or
services operating pursuant to the standards; or (3) "interoperable" means able to connect
users among different video conferencing services, including VRS. The Further Notice
also seeks comment on whether we should exercise our ancillary jurisdiction to require
that a video mail service be accessible to individuals with disabilities when provided
along with a video conferencing service as we did in the context of Section 255 in regard
to voice mail. The Further Notice seeks comment on several proposals to (1) extend our
accessibility of information content guidelines to cover additional concepts; (2) expand
our definition of peripheral devices to include electronically mediated services; (3)
expand our Part 6 requirements to include testable criteria. We also seek to develop a
record on a proposal to define technical standards for safe harbors using the W3C/WAI
Web guidelines or ISO/IEC 13066-1:2011. Finally, we seek comment on our proposal to
implement Section 718 of the CVAA consistent with the recordkeeping requirements
adopted in the Report and Order.
15.
We seek comment on the preceding topics because even though at present
we do not have enough information to propose a specific rule, we believe that during the
effective period of the temporary small business exemption, information about these
topics will in all likelihood become crucial and indeed determinative of how the
implementation of the exemption will be carried out in concrete terms. For example,
within the exemption period, technological innovations and advances may make
interoperability more available in providing improved access to the deaf/blind community
in service areas where interoperability is not yet feasible for technological reasons. Also,
technological advances in coverage of video mail or in the availability of safe harbors
may become more available and more efficiently operational after the exemption period
than they are at present, and thus, during the temporary exemption, these various areas of
increased availability and increased effective impact may affect the provision of ACS to
the deaf and/or blind community. Hence, because these topics may become pivotal and
crucial after the exemption period, we choose to seek comment on these topics at this
time because based on our assessment of the admittedly scant record to date, we conclude
that such comment may effectively guide the Commission toward a more comprehensive
and efficient implementation of the temporary exemption. We also seek comment on
implementing Section 718, which requires a mobile phone manufacturer that includes a
browser, or a mobile phone service provider that arranges for a browser to be included on
a mobile phone, to ensure that the browser functions are accessible to and usable by
individuals who are blind or have a visual impairment, unless doing so is not
achievable.19 Under Section 718, mobile phone manufacturers or service providers may
achieve compliance by relying on third party applications, peripheral devices, software,
hardware, or customer premises equipment. Congress provided that the effective date for
these requirements is three years after the enactment of the CVAA, i.e., October 8, 2013.


19 See 47 U.S.C. 619(a); see also House Report at 27 ("The Committee also intends that the service
provider and the manufacturer are each only subject to these provisions with respect to a browser that such
service provider or manufacturer directs or specifies to be included in the device.").
6

Federal Communications Commission

FCC 11-151

B.

Legal Basis

16.
The legal basis for any action that may be taken pursuant to the Further
Notice is contained in Sections 1-4, 255, 303(r), 403, 503, 716, 717, 718 of the
Communications Act of 1934, as Amended, 47 U.S.C. 151-154, 255, 303(r), 403, 503,
617, 618, 619.

C.

Description and Estimate of the Number of Small Entities to Which
the Rules Will Apply

17.
The RFA directs agencies to provide a description of, and where feasible,
an estimate of the number of small entities that face possible significant economic impact
by the adoption of proposed rules.20 The RFA generally defines the term "small entity"
as having the same meaning as the terms "small business," "small organization," and
"small governmental jurisdiction."21 In addition, the term "small business" has the same
meaning as the term "small business concern" under the Small Business Act.22 A "small
business concern" is one that (1) is independently owned and operated; (2) is not
dominant in its field of operation; and (3) satisfies any additional criteria established by
the SBA.23
18.
To assist the Commission in analyzing the total number of small entities
potentially affected by the proposals in the Further Notice, we ask commenters to
estimate the number of small entities that may be affected. To assist in assessing the
nature and number of small entities that face possible significant economic impact by the
proposals in the Further Notice, we seek comment on the industry categories below and
our estimates of the entities in each category that can, under relevant SBA standards or
standards previously approved by the SBA for small businesses, be classified as small.
Where a commenter proposes an exemption from the requirements of Section 716 and in
effect Section 717, we also seek estimates from that commenter on the number of small
entities in each category that would be exempted from compliance with Section 716 and
in effect Section 717 under the proposed exemption, the percentage of market share for
the service or product that would be exempted, and the economic impact, if any, on those
entities that are not covered by the proposed exemption. While the Further Notice and
this IRFA seek comment on whether and how the Commission should permanently
exempt small entities from the requirements of Section 716 and in effect Section 717 for
the purposes of building a record on that issue, we will assume, for the narrow purpose of


20 5 U.S.C. 604(a)(3).
21 5 U.S.C. 601(6).
22 5 U.S.C. 601(3) (incorporating by reference the definition of "small business concern" in the Small
Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business
applies "unless an agency, after consultation with the Office of Advocacy of the Small Business
Administration and after opportunity for public comment, establishes one or more definitions of such term
which are appropriate to the activities of the agency and publishes such definition(s) in the Federal
Register." 5 U.S.C. 601(3).
2315 U.S.C. 632.
7

Federal Communications Commission

FCC 11-151

including a thorough regulatory impact analysis in this IRFA, that no such exemptions
will be provided.
19.
Many of the issues raised in the Further Notice relate to clarifying
obligations on entities already covered by the Report and Order, which may affect a
broad range of service providers and equipment manufacturers. The Further Notice
seeks comment on making permanent a temporary exemption for small entities that
qualify as small business concerns under the SBA's rules and small business size
standards, or some other criteria. Therefore, it is possible that all entities that would be
required to comply with Section 716 and Section 717, but are small business concerns or
qualify as small entities under some other criteria, will be exempt from the provisions of
the proposed rules implementing Section 716 and Section 717. The CVAA, however,
does not provide the flexibility for the Commission to adopt an exemption for small
entities from compliance with Section 718. Therefore, we estimate below the impact on
small entities absent a permanent exemption from Section 716 and Section 717, and small
entities that may have to comply with Section 718. Specifically, we analyze the number
of small businesses engaged in manufacturing that may be affected by the Further Notice,
absent a permanent small entity exemption, including manufacturers of equipment used
to provide interconnected and non-interconnected VoIP, electronic messaging, and
interoperable video conferencing services. We then analyze the number of small
businesses engaged as service providers that may be affected by the Report and Order,
absent a permanent small entity exemption, including providers of interconnected and
non-interconnected VoIP, electronic messaging services, interoperable video
conferencing services, wireless services, wireline services, and other relevant services.
20.
Small Businesses, Small Organizations, and Small Governmental
Jurisdictions. Our action may, over time, affect small entities that are not easily
categorized at present. We therefore describe here, at the outset, three comprehensive,
statutory small entity size standards.24 First, nationwide, there are a total of
approximately 27.5 million small businesses, according to the SBA.25 In addition, a
"small organization" is generally "any not-for-profit enterprise which is independently
owned and operated and is not dominant in its field."26 Nationwide, as of 2007, there
were approximately 1,621,315 small organizations.27 Finally, the term "small
governmental jurisdiction" is defined generally as "governments of cities, towns,
townships, villages, school districts, or special districts, with a population of less than
fifty thousand."28 Census Bureau data for 2011 indicate that there were 89,476 local
governmental jurisdictions in the United States.29 We estimate that, of this total, as many


24 See 5 U.S.C. 601(3)(6).
25 See SBA, Office of Advocacy, "Frequently Asked Questions," http://web.sba.gov/faqs (last visited May
6, 2011) (figures are from 2009).
26 5 U.S.C. 601(4).
27 INDEPENDENT SECTOR, THE NEW NONPROFIT ALMANAC & DESK REFERENCE (2010).
28 5 U.S.C. 601(5).
29 U.S. CENSUS BUREAU, STATISTICAL ABSTRACT OF THE UNITED STATES: 2011, Table 427 (2007).
8

Federal Communications Commission

FCC 11-151

as 88,506 entities may qualify as "small governmental jurisdictions."30 Thus, we
estimate that most governmental jurisdictions are small.
1.

Equipment Manufacturers

a.

Manufacturers of Equipment to Provide VoIP

21.
Entities manufacturing equipment used to provide interconnected VoIP,
non-interconnected VoIP, or both are generally found in one of two Census Bureau
categories, "Electronic Computer Manufacturing"31 or "Telephone Apparatus
Manufacturing."32 We include here an analysis of the possible significant economic
impact of our proposed rules on manufacturers of equipment used to provide both
interconnected and non-interconnected VoIP because it is not possible to separate
available data on these two manufacturing categories for VoIP equipment. Our estimates
below likely greatly overstate the number of small entities that manufacture equipment
used to provide ACS, including interconnected VoIP. However, in the absence of more
accurate data, we present these figures to provide as thorough an analysis of the impact
on small entities as possible.
22.
Electronic Computer Manufacturing. The Census Bureau defines this
category to include "establishments primarily engaged in manufacturing and/or
assembling electronic computers, such as mainframes, personal computers, workstations,
laptops, and computer servers. Computers can be analog, digital, or hybrid . . . The
manufacture of computers includes the assembly or integration of processors,
coprocessors, memory, storage, and input/output devices into a user-programmable final
product."33
23.
In this category, the SBA deems and electronic computer manufacturing
business to be small if it has 1,000 employees or less.34 For this category of
manufacturers, Census data for 2007 show that there were 421 establishments that


30 The 2007 U.S Census data for small governmental organizations are not presented based on the size of
the population in each such organization. There were 89,476 small governmental organizations in 2007. If
we assume that county, municipal, township and school district organizations are more likely than larger
governmental organizations to have populations of 50,000 or less, the total of these organizations is 52,125.
If we make the same assumption about special districts, and also assume that special districts are different
from county, municipal, township, and school districts, in 2007 there were 37,381 special districts.
Therefore, of the 89,476 small governmental organizations documented in 2007, as many as 89,506 may be
considered small under the applicable standard. This data may overestimate the number of such
organizations that has a population of 50,000 or less. U.S. CENSUS BUREAU, STATISTICAL ABSTRACT OF
THE UNITED STATES 2011, Tables 427, 426 (data cited therein are from 2007).
31 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
32 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
33 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
34 13 C.F.R. 121.201, NAICS Code 334111.
9

Federal Communications Commission

FCC 11-151

operated that year. Of those 421, 384 had 100 or fewer employees and 37 had 100 or
more employees.35 On this basis, we estimate that the majority of manufacturers of
equipment used to provide electronic messaging services in this category are small.
24.
Telephone Apparatus Manufacturing. The Census Bureau defines this
category to comprise "establishments primarily engaged in manufacturing wire telephone
and data communications equipment. These products may be standalone or board-level
components of a larger system. Examples of products made by these establishments are
central office switching equipment, cordless telephones (except cellular), PBX
equipment, telephones, telephone answering machines, LAN modems, multi-user
modems, and other data communications equipment, such as bridges, routers, and
gateways."36
25.
In this category, the SBA deems a telephone apparatus manufacturing
business to be small if it has 1,000 or fewer employees.37 For this category of
manufacturers, Census data for 2007 shows there were 398 such establishments in
operation.38 Of those 398 establishments, 393 (approximately 99%) had 1,000 or fewer
employees and, thus, would be deemed small under the applicable SBA size standard.39
On this basis, the Commission estimates that approximately 99% or more of the
manufacturers of equipment used to provide VoIP in this category are small.
b.

Manufacturers of Equipment to Provide Electronic
Messaging

26.
Entities that manufacture equipment (other than software) used to provide
electronic messaging services are generally found in one of three Census Bureau
categories: "Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing,"40 "Electronic Computer Manufacturing,"41 or "Telephone
Apparatus Manufacturing."42


35 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&;-
_skip=300&-ds_name=EC0731I1&-_lang=en
36 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
37 13 C.F.R. 121.201, NAICS Code 334210.
38 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics
by Employment Size, NAICS code 334210 (rel. Nov. 16, 2010); http://factfinder.census.gov.
39 Id.
40 U.S. Census Bureau, 2007 NAICS Definitions, 334220 Radio and Television Broadcasting and Wireless
Communications Equipment, http://www.census.gov/econ/industry/def/d334220.htm.
41 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
42 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
10

Federal Communications Commission

FCC 11-151

27.
Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. The Census Bureau defines this category as follows: "This
industry comprises establishments primarily engaged in manufacturing radio and
television broadcast and wireless communications equipment. Examples of products
made by these establishments are: transmitting and receiving antennas, cable television
equipment, GPS equipment, pagers, cellular phones, mobile communications equipment,
and radio and television studio and broadcasting equipment." The SBA has developed a
small business size standard for Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing which is: all such firms having 750 or fewer
employees. According to Census Bureau data for 2007, there were a total of 919
establishments in this category that operated for part or all of the entire year. Of this total,
771 had less than 100 employees and 148 had more than 100 employees.43 Thus, under
this size standard, the majority of firms can be considered small.
28.
Electronic Computer Manufacturing. The Census Bureau defines this
category to include "establishments primarily engaged in manufacturing and/or
assembling electronic computers, such as mainframes, personal computers, workstations,
laptops, and computer servers. Computers can be analog, digital, or hybrid. . . . The
manufacture of computers includes the assembly or integration of processors,
coprocessors, memory, storage, and input/output devices into a user-programmable final
product."44
29.
In this category the SBA deems an electronic computer manufacturing
business to be small if it has 1,000 or fewer employees.45 For this category of
manufacturers, Census data for 2007 show that there were 421 such establishments that
operated that year. Of those 421 establishments, 384 had 1,000 or fewer employees. 46
On this basis, we estimate that the majority of the manufacturers of equipment used to
provide electronic messaging services in this category are small.
30.
Telephone Apparatus Manufacturing. The Census Bureau defines this
category to comprise "establishments primarily engaged in manufacturing wire telephone
and data communications equipment. These products may be stand alone or board-level
components of a larger system. Examples of products made by these establishments are
central office switching equipment, cordless telephones (except cellular), PBX
equipment, telephones, telephone answering machines, LAN modems, multi-user


43 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=300&-ds_name=EC0731I1&-_lang=en.
44 U.S. Census Bureau, 2007 NAICS Definitions, 334111 Electronic Computer Manufacturing,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=334111&search=2007%20NAICS%20Search.
45 13 C.F.R. 121.201, NAICS Code 334111.
46 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&;-
_skip=300&-ds_name=EC0731I1&-_lang=en.
11

Federal Communications Commission

FCC 11-151

modems, and other data communications equipment, such as bridges, routers, and
gateways."47
31.
In this category the SBA deems a telephone apparatus manufacturing
business to be small if it has 1,000 or fewer employees.48 For this category of
manufacturers, Census data for 2007 shows that there were 398 such establishments that
operated that year.49 Of those 398 establishments, 393 (approximately 99%) had 1,000 or
fewer employees and, thus, would be deemed small under the applicable SBA size
standard.50 On this basis, the Commission estimates that approximately 99% or more of
the manufacturers of equipment used to provide electronic messaging services in this
category are small.
c.

Manufacturers of Equipment Used to Provide Interoperable
Video Conferencing Services

32.
Entities that manufacture equipment used to provide interoperable and
other video conferencing services are generally found in the Census Bureau category:
"Other Communications Equipment Manufacturing." The Census Bureau defines this
category to include: "establishments primarily engaged in manufacturing
communications equipment (except telephone apparatus, and radio and television
broadcast, and wireless communications equipment)."51
33.
Other Communications Equipment Manufacturing. In this category, the
SBA deems a business manufacturing other communications equipment to be small if it
has 750 or fewer employees.52 For this category of manufacturers, Census data for 2007
show that there were 452 establishments that operated that year. Of the 452
establishments 406 had fewer than 100 employees and 46 had more than 100 employees.
Accordingly, the Commission estimates that a substantial majority of the manufacturers
of equipment used to provide interoperable and other video-conferencing services are
small.53


47 U.S. Census Bureau, 2007 NAICS Definitions, 334210 Telephone Apparatus Manufacturing,
http://www.census.gov/naics/2007/def/ND334210.HTM.
48 13 C.F.R. 121.201, NAICS Code 334210.
49 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics
by Employment Size, NAICS code 334111 (rel. Nov. 16, 2010); http://factfinder.census.gov.
50 Id.
51 U.S. Census Bureau, 2007 NAICS Definitions, 334290 Other communications equipment manufacturing,
http://www.census.gov/econ/industry/def/d334290.htm.
52 13 C.F.R. 121.201, NAICS Code 334220.
53 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&;-
_skip=300&-ds_name=EC0731I1&-_lang=en.
12

Federal Communications Commission

FCC 11-151

2.

Service Providers

a.

Providers of VoIP

34.
Entities that provide interconnected or non-interconnected VoIP or both
are generally found in one of two Census Bureau categories, "Wired Telecommunications
Carriers" or "All Other Telecommunications."
35.
Wired Telecommunications Carriers. The Census Bureau defines this
category as follows: "This industry comprises establishments primarily engaged in
operating and/or providing access to transmission facilities and infrastructure that they
own and/or lease for the transmission of voice, data, text, sound, and video using wired
telecommunications networks. Transmission facilities may be based on a single
technology or a combination of technologies. Establishments in this industry use the
wired telecommunications network facilities that they operate to provide a variety of
services, such as wired telephony services, including VoIP services; wired (cable) audio
and video programming distribution; and wired broadband Internet services. By
exception, establishments providing satellite television distribution services using
facilities and infrastructure that they operate are included in this industry."54
36.
In this category, the SBA deems a wired telecommunications carrier to be
small if it has 1,500 or fewer employees.55 Census data for 2007 shows 3,188 firms in
this category56 Of these 3,188 firms, only 44 had 1,000 or more employees. While we
could not find precise Census data on the number of firms with in the group with 1,500 or
fewer employees, it is clear that at least 3,144 firms with fewer than 1,000 employees
would be in that group. On this basis, the Commission estimates that a substantial
majority of the providers of interconnected VoIP, non-interconnected VoIP, or both in
this category, are small.57
37.
All Other Telecommunications. Under the 2007 U.S. Census definition of
firms included in the category "All Other Telecommunications (NAICS Code
517919)"comprises "establishments primarily engaged in providing specialized
telecommunications services, such as satellite tracking, communications telemetry, and
radar station operation. This industry also includes establishments primarily engaged in
providing satellite terminal stations and associated facilities connected with one or more


54 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers,
http://www.census.gov/econ/industry/def/d517110.htm.
55 13 C.F.R. 121.201, NAICS Code 517110.
56 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=600&;-
ds_name=EC0751SSSZ5&-_lang=en.
57 Id. As noted in para. 21 above with regard to the distinction between manufacturers of equipment used to
provide interconnected VoIP and manufactures of equipment to provide non-interconnected VoIP, our
estimates of the number of the number of providers of non-interconnected VoIP (and the number of small
entities within that group) are likely overstated because we could not draw in the data a distinction between
such providers and those that provide interconnected VoIP. However, in the absence of more accurate data,
we present these figures to provide as thorough an analysis of the impact on small entities as we can at this
time.
13

Federal Communications Commission

FCC 11-151

terrestrial systems and capable of transmitting telecommunications to, and receiving
telecommunications from, satellite systems. Establishments providing Internet services
or voice over Internet protocol (VoIP) services via client-supplied telecommunications
connections are also included in this industry."58
38.
In this category, the SBA deems a provider of "all other
telecommunications" services to be small if it has $25 million or less in average annual
receipts.59 For this category of service providers, Census data for 2007 shows that there
were 2,383 such firms that operated that year.60 Of those 2,383 firms, 2,346
(approximately 98%) had $25 million or less in average annual receipts and, thus, would
be deemed small under the applicable SBA size standard. On this basis, Commission
estimates that approximately 98% or more of the providers of interconnected VoIP, non-
interconnected VoIP, or both in this category are small.61
b.

Providers of Electronic Messaging Services

39.
Entities that provide electronic messaging services are generally found in
one of the following Census Bureau categories, "Wireless Telecommunications Carriers
(except Satellites)," "Wired Telecommunications," or "Internet Publishing and
Broadcasting and Web Search Portals."
40.
Wireless Telecommunications Carriers (except Satellite). Since 2007, the
Census Bureau has placed wireless firms within this new, broad, economic census
category.62 Prior to that time, such firms were within the now-superseded categories of
"Paging" and "Cellular and Other Wireless Telecommunications."63 Under the present
and prior categories, the SBA has deemed a wireless business to be small if it has 1,500
or fewer employees.64 For the category of Wireless Telecommunications Carriers (except
Satellite), Census data for 2007 shows that there were 1,383 firms that operated that


58 U.S. Census Bureau, 2007 NAICS Definitions, 517919 All Other Telecommunications,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517919&search=2007%20NAICS%20Search.
59 13 C.F.R. 121.201, NAICS Code 517919.
60 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
61 See discussion supra note 57, regarding possible overestimation of firms and small entities providing
non-interconnected VoIP services.
62 U.S. Census Bureau, 2007 NAICS Definitions, 517210 Wireless Telecommunications Carriers (Except
Satellite), http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
63 U.S. Census Bureau, 2002 NAICS Definitions, 517211 Paging,
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. Census Bureau, 2002 NAICS Definitions,
"517212 Cellular and Other Wireless Telecommunications";
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
64 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R.
citations were 13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
14

Federal Communications Commission

FCC 11-151

year.65 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more than
100 employees. Thus under this category and the associated small business size standard,
the majority of firms can be considered small. Similarly, according to Commission data,
413 carriers reported that they were engaged in the provision of wireless telephony,
including cellular service, Personal Communications Service ("PCS"), and Specialized
Mobile Radio ("SMR") Telephony services.66 Of these, an estimated 261 have 1,500 or
fewer employees and 152 have more than 1,500 employees.67 Consequently, the
Commission estimates that approximately half or more of these firms can be considered
small. Thus, using available data, we estimate that the majority of wireless firms can be
considered small.
41.
Wired Telecommunications Carriers. For the 2007 US Census definition
of firms included in the category, "Wired Telecommunications Carriers (NAICS Code
517110)," see paragraph 35 above.
42.
In this category, the SBA deems a wired telecommunications carrier to be
small if it has 1,500 or fewer employees.68 Census data for 2007 shows 3,188 firms in
this category.69 Of these 3,188 firms, only 44 (approximately 1%) had 1,000 or more
employees.70 While we could not find precise Census data on the number of firms in the
group with 1,500 or fewer employees, it is clear that at least the 3,188 firms with fewer
than 1,000 employees would be in that group. Thus, at least 3,144 of these 3,188 firms
(approximately 99%) had 1,500 or fewer employees. On this basis, the Commission
estimates that approximately 99% or more of the providers of electronic messaging
services in this category are small.
43.
Internet Publishing and Broadcasting and Web Search Portals. The
Census Bureau defines this category to include "establishments primarily engaged in 1)
publishing and/or broadcasting content on the Internet exclusively or 2) operating Web
sites that use a search engine to generate and maintain extensive databases of Internet
addresses and content in an easily searchable format (and known as Web search portals).
The publishing and broadcasting establishments in this industry do not provide traditional
(non-Internet) versions of the content that they publish or broadcast. They provide
textual, audio, and/or video content of general or specific interest on the Internet
exclusively. Establishments known as Web search portals often provide additional


65 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
66 See Trends in Telephone Service, at tbl. 5.3.
67 Id.
68 13 C.F.R. 121.201, NAICS Code 517110.
69 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics
by Employment Size, NAICS code 517110 (rel. Nov. 19, 2010); http://factfinder.census.gov.
70 Id.
15

Federal Communications Commission

FCC 11-151

Internet services, such as e-mail, connections to other web sites, auctions, news, and other
limited content, and serve as a home base for Internet users."71
44.
In this category, the SBA deems an Internet publisher or Internet
broadcaster or the provider of a web search portal on the Internet to be small if it has 500
or fewer employees.72 For this category of manufacturers, Census data for 2007 shows
that there were 2,705 such firms that operated that year. 73 Of those 2,705 firms, 2,682
(approximately 99%) had 500 or fewer employees and, thus, would be deemed small
under the applicable SBA size standard.74 On this basis, the Commission estimates that
approximately 99% or more of the providers of electronic messaging services in this
category are small.
45.
Data Processing, Hosting, and Related Services. The Census Bureau
defines this category to include "establishments primarily engaged in providing
infrastructure for hosting or data processing services. These establishments may provide
specialized hosting activities, such as web hosting, streaming services or application
hosting; provide application service provisioning; or may provide general time-share
mainframe facilities to clients. Data processing establishments provide complete
processing and specialized reports from data supplied by clients or provide automated
data processing and data entry services."75
46.
In this category, the SBA deems a data processing, hosting, or related
services provider to be small if it has $25 million or less in annual receipts.76 For this
category of providers, Census data for 2007 shows that there were 14,193 such
establishments that operated that year.77 Of those 14,193 firms, 12,985 had less than $10
million in annual receipts, and 1,208 had greater than $10 million.78 Although no data is
available to confirm the number of establishments with greater than $25 million in
receipts, the available data confirms the majority of establishments in this category were
small. On this basis, the Commission estimates that approximately 96% of the providers
of electronic messaging services in this category are small.


71 U.S. Census Bureau, 2007 NAICS Definitions, 519130 Internet Publishing and Broadcasting and Web
Search Portals, http://www.naics.com/censusfiles/ND519130.HTM.
72 13 C.F.R. 121.201, NAICS Code 519130.
73 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics
by Employment Size, NAICS code 519130 (rel. Nov. 19, 2010); http://factfinder.census.gov.
74 Id.
75 U.S. Census Bureau, 2007 NAICS Definition, 518210 Data Processing, Hosting, and Related Services,
http://www.census.gov/cgi-bin/sssd/naics/naicsrch.
76 13 C.F.R. 121.201; NAICS Code 518210.
77 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&;-
_skip=800&-ds_name=EC0751SSSZ1&-_lang=en.
78 Id.
16

Federal Communications Commission

FCC 11-151

c.

Providers of Interoperable Video Conferencing Services

47.
Entities that provide interoperable video conferencing services are found
in the Census Bureau Category "All Other Telecommunications."
48.
All Other Telecommunications. For the 2007 US Census definition of
firms included in the category, "All Other Telecommunications (NAICS Code 517919),"
see paragraph 37 above.
49.
In this category, the SBA deems a provider of "all other
telecommunications" services to be small if it has $25 million or less in average annual
receipts.79 Census data for 2007 show that there were 2,383 such firms that operated that
year.80 Of those 2,383 firms, 2,346 (approximately 98%) had $25 million or less in
average annual receipts and, thus, would be deemed small under the applicable SBA size
standard. On this basis, Commission estimates that approximately 98% or more of the
providers of interoperable video conferencing services are small.
3.

Additional Industry Categories.

a.

Certain Wireless Carriers and Service Providers

50.
Cellular Licensees. The SBA has developed a small business size standard
for small businesses in the category "Wireless Telecommunications Carriers (except
satellite)."81 Under that SBA category, a business is small if it has 1,500 or fewer
employees.82 The census category of "Cellular and Other Wireless Telecommunications"
is no longer used and has been superseded by the larger category "Wireless
Telecommunications Carriers (except satellite)." The Census Bureau defines this larger
category to include "establishments engaged in operating and maintaining switching and
transmission facilities to provide communications via the airwaves. Establishments in
this industry have spectrum licenses and provide services using that spectrum, such as
cellular phone services, paging services, wireless Internet access, and wireless video
services."83
51.
Census data for 2007 shows 1,383 firms in this category.84 Of these 1,383
firms, only 15 (approximately 1%) had 1,000 or more employees.85 While there is no
precise Census data on the number of firms the group with 1,500 or fewer employees, it


79 13 C.F.R. 121.201, NAICS Code 517919.
80 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
81 13 C.F.R. 121.201, North American Industry Classification System (NAICS) code 517210.
82 Id.
83 U.S. Census Bureau, 2007 NAICS Definitions, Wireless Telecommunications Carriers (Except
Satellites) http://www.census.gov/econ/industry/def/d517210.htm.
84 U.S. Census Bureau, American FactFinder, 2007 Economic Census, Industry Series, Industry Statistics
by Employment Size, NAICS code 517210 (rel. Nov. 19, 2010); http://factfinder.census.gov.
85 Id.
17

Federal Communications Commission

FCC 11-151

is clear that at least the 1,368 firms with fewer than 1,000 employees would be found in
that group. Thus, at least 1,368 of these 1,383 firms (approximately 99%) 1,500 or fewer
employees. On this basis, Commission estimates that approximately 99% or more of the
providers of electronic messaging services in this category are small.
52.
Specialized Mobile Radio. The Commission awards "small entity" bidding
credits in auctions for Specialized Mobile Radio (SMR) geographic area licenses in the
800 MHz and 900 MHz bands to firms that had revenues of no more than $15 million in
each of the three previous calendar years.86 The Commission awards "very small entity"
bidding credits to firms that had revenues of no more than $3 million in each of the three
previous calendar years.87 The SBA has approved these small business size standards for
the 900 MHz Service.88 The Commission has held auctions for geographic area licenses
in the 800 MHz and 900 MHz bands. The 900 MHz SMR auction began on December 5,
1995, and closed on April 15, 1996. Sixty bidders claiming that they qualified as small
businesses under the $15 million size standard won 263 geographic area licenses in the
900 MHz SMR band. The 800 MHz SMR auction for the upper 200 channels began on
October 28, 1997, and was completed on December 8, 1997. Ten bidders claiming that
they qualified as small businesses under the $15 million size standard won 38 geographic
area licenses for the upper 200 channels in the 800 MHz SMR band.89 A second auction
for the 800 MHz band was held on January 10, 2002 and closed on January 17, 2002 and
included 23 licenses. One bidder claiming small business status won five licenses.90
53.
The auction of the 1,053 800 MHz SMR geographic area licenses for the
General Category channels began on August 16, 2000, and was completed on September
1, 2000. Eleven bidders that won 108 geographic area licenses for the General Category
channels in the 800 MHz SMR band qualified as small businesses under the $15 million
size standard. In an auction completed on December 5, 2000, a total of 2,800 Economic
Area licenses in the lower 80 channels of the 800 MHz SMR service were sold. Of the
22 winning bidders, 19 claimed "small business" status and won 129 licenses. Thus,
combining all three auctions, 40 winning bidders for geographic licenses in the 800 MHz
SMR band claimed status as small business.
54.
In addition, there are numerous incumbent site-by-site SMR licensees and
licensees with extended implementation authorizations in the 800 and 900 MHz bands.
The Commission does not know how many firms provide 800 MHz or 900 MHz
geographic area SMR services pursuant to extended implementation authorizations, nor
how many of these providers have annual revenues of no more than $15 million. One


86 47 C.F.R. 90.814(b)(1).
87 Id.
88 See Letter from Aida Alvarez, Administrator, Small Business Administration, to Thomas Sugrue, Chief,
Wireless Telecommunications Bureau, Federal Communications Commission, dated August 10, 1999.
89 See Correction to Public Notice DA 96-586, FCC Announces Winning Bidders in the Auction of 1020
Licenses to Provide 900 MHz SMR in Major Trading Areas
, Public Notice, 18 FCC Rcd 18367 (WTB
1996).
90 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
18

Federal Communications Commission

FCC 11-151

firm has over $15 million in revenues. In addition, we do not know how many of these
firms have 1,500 or fewer employees. The Commission assumes, for purposes of this
analysis, that all of the remaining existing extended implementation authorizations are
held by small entities.
55.
AWS Services (17101755 MHz and 21102155 MHz bands (AWS-1);
19151920 MHz, 19952000 MHz, 20202025 MHz and 21752180 MHz bands (AWS-
2); 21552175 MHz band (AWS-3)).
For the AWS-1 bands, the Commission has defined
a "small business" as an entity with average annual gross revenues for the preceding three
years not exceeding $40 million, and a "very small business" as an entity with average
annual gross revenues for the preceding three years not exceeding $15 million.91 In 2006,
the Commission conducted its first auction of AWS-1 licenses.92 In that initial AWS-1
auction, 31 winning bidders identified themselves as very small businesses.93 Twenty-six
of the winning bidders identified themselves as small businesses.94 In a subsequent 2008
auction, the Commission offered 35 AWS-1 licenses.95 Four winning bidders identified
themselves as very small businesses, and three of the winning bidders identified
themselves as a small business.96 For AWS-2 and AWS-3, although we do not know for
certain which entities are likely to apply for these frequencies, we note that the AWS-1
bands are comparable to those used for cellular service and personal communications
service. The Commission has not yet adopted size standards for the AWS-2 or AWS-3
bands but has proposed to treat both AWS-2 and AWS-3 similarly to broadband PCS
service and AWS-1 service due to the comparable capital requirements and other factors,
such as issues involved in relocating incumbents and developing markets, technologies,
and services.97


91 See Service Rules for Advanced Wireless Services in the 1.7 GHz and 2.1 GHz Bands, Report and
Order
, 18 FCC Rcd 25,162, App. B (2003), modified by Service Rules for Advanced Wireless Services In
the 1.7 GHz and 2.1 GHz Bands, Order on Reconsideration, 20 FCC Rcd 14,058, App. C (2005).
92 See Auction of Advanced Wireless Services Licenses Scheduled for June 29, 2006; Notice and Filing
Requirements, Minimum Opening Bids, Upfront Payments and Other Procedures for Auction No. 66
, AU
Docket No. 06-30, Public Notice, 21 FCC Rcd 4562 (2006) ("Auction 66 Procedures Public Notice").
93 See Auction of Advanced Wireless Services Licenses Closes; Winning Bidders Announced for Auction
No. 66
, Public Notice, 21 FCC Rcd 10,521 (2006) ("Auction 66 Closing Public Notice").
94 See id.
95 See AWS-1 and Broadband PCS Procedures Public Notice, 23 FCC Rcd at 7499. Auction 78 also
included an auction of broadband PCS licenses.
96 See Auction of AWS-1 and Broadband PCS Licenses Closes, Winning Bidders Announced for Auction 78,
Down Payments Due September 9, 2008, FCC Forms 601 and 602 Due September 9, 2008, Final Payments
Due September 23, 2008, Ten-Day Petition to Deny Period
, Public Notice, 23 FCC Rcd 12,749 (2008).
97 Service Rules for Advanced Wireless Services in the 19151920 MHz, 19952000 MHz, 20202025 MHz
and 21752180 MHz Bands et al.
, Notice of Proposed Rulemaking, 19 FCC Rcd 19,263, App. B (2005);
Service Rules for Advanced Wireless Services in the 21552175 MHz Band, Notice of Proposed
Rulemaking, 22 FCC Rcd 17,035, App. (2007); Service Rules for Advanced Wireless Services in the 2155-
2175 MHz Band
, Further Notice of Proposed Rulemaking, 23 FCC Rcd 9859, App. B (2008).
19

Federal Communications Commission

FCC 11-151

56.
700 MHz Guard Band Licenses. In the 700 MHz Guard Band Order, the
Commission adopted size standards for "small businesses" and "very small businesses"
for purposes of determining their eligibility for special provisions such as bidding credits
and installment payments.98 A small business in this service is an entity that, together
with its affiliates and controlling principals, has average gross revenues not exceeding
$40 million for the preceding three years.99 Additionally, a "very small business" is an
entity that, together with its affiliates and controlling principals, has average gross
revenues that are not more than $15 million for the preceding three years.100 SBA
approval of these definitions is not required.101 In 2000, the Commission conducted an
auction of 52 Major Economic Area ("MEA") licenses.102 Of the 104 licenses auctioned,
96 licenses were sold to nine bidders. Five of these bidders were small businesses that
won a total of 26 licenses. A second auction of 700 MHz Guard Band licenses
commenced and closed in 2001. All eight of the licenses auctioned were sold to three
bidders. One of these bidders was a small business that won a total of two licenses.103
57.
Upper 700 MHz Band Licenses. In the 700 MHz Second Report and
Order, the Commission revised its rules regarding Upper 700 MHz licenses.104 On
January 24, 2008, the Commission commenced Auction 73 in which several licenses in
the Upper 700 MHz band were available for licensing: 12 Regional Economic Area
Grouping licenses in the C Block, and one nationwide license in the D Block.105 The
auction concluded on March 18, 2008, with 3 winning bidders claiming very small


98 Service Rules for the 746-764 MHz Bands, and Revisions to Part 27 of the Commission's Rules, Second
Report and Order, 15 FCC Rcd 5299 (2000). Service rules were amended in 2007, but no changes were
made to small business size categories. See Service Rules for the 698-746, 747-762 and 777-792 MHz
Bands, WT Docket No. 06-150, Revision of the Commission's Rules to Ensure Compatibility with Enhanced
911 Emergency Calling Systems, CC Docket No. 94-102, Section 68.4(a) of the Commission's Rules
Governing Hearing Aid-Compatible Telephones, WT Docket No. 01-309, Biennial Regulatory Review
Amendment of Parts 1, 22, 24, 27, and 90 to Streamline and Harmonize Various Rules Affecting Wireless
Radio Services, WT Docket 03-264, Former Nextel Communications, Inc. Upper 700 MHz Guard Band
Licenses and Revisions to Part 27 of the Commission's Rules, WT Docket No. 06-169, Implementing a
Nationwide, Broadband, Interoperable Public Safety Network in the 700 MHz Band, PS Docket No. 06-
229, Development of Operational, Technical and Spectrum Requirements for Meeting Federal, State and
Local Public Safety Communications Requirements Through the Year 2010
, WT Docket No. 96-86, Report
and Order and Further Notice of Proposed Rulemaking, 22 FCC Rcd 8064 (2007).
99 Id. at 5343 108.
100 Id.
101 Id. at 5343 108 n.246 (for the 746-764 MHz and 776-704 MHz bands, the Commission is exempt from
15 U.S.C. 632, which requires Federal agencies to obtain Small Business Administration approval before
adopting small business size standards).
102 See 700 MHz Guard Bands Auction Closes: Winning Bidders Announced, Public Notice, 15 FCC Rcd
18026 (2000).
103 See 700 MHz Guard Bands Auction Closes: Winning Bidders Announced, Public Notice, 16 FCC Rcd
4590 (WTB 2001).
104 700 MHz Second Report and Order, 22 FCC Rcd 15289.
105 See Auction of 700 MHz Band Licenses Closes, Public Notice, 23 FCC Rcd 4572 (WTB 2008).
20

Federal Communications Commission

FCC 11-151

business status (those with attributable average annual gross revenues that do not exceed
$15 million for the preceding three years) and winning five licenses.
58.
Lower 700 MHz Band Licenses. The Commission previously adopted
criteria for defining three groups of small businesses for purposes of determining their
eligibility for special provisions such as bidding credits.106 The Commission defined a
"small business" as an entity that, together with its affiliates and controlling principals,
has average gross revenues not exceeding $40 million for the preceding three years.107 A
"very small business" is defined as an entity that, together with its affiliates and
controlling principals, has average gross revenues that are not more than $15 million for
the preceding three years.108 Additionally, the lower 700 MHz Service had a third
category of small business status for Metropolitan/Rural Service Area (MSA/RSA)
licenses--"entrepreneur"--which is defined as an entity that, together with its affiliates
and controlling principals, has average gross revenues that are not more than $3 million
for the preceding three years.109 The SBA approved these small size standards.110 An
auction of 740 licenses (one license in each of the 734 MSAs/RSAs and one license in
each of the six Economic Area Groupings (EAGs)) was conducted in 2002. Of the 740
licenses available for auction, 484 licenses were won by 102 winning bidders. Seventy-
two of the winning bidders claimed small business, very small business or entrepreneur
status and won licenses.111 A second auction commenced on May 28, 2003, closed on
June 13, 2003, and included 256 licenses.112 Seventeen winning bidders claimed small or
very small business status, and nine winning bidders claimed entrepreneur status.113 In
2005, the Commission completed an auction of 5 licenses in the Lower 700 MHz band.
All three winning bidders claimed small business status.
59.
In 2007, the Commission reexamined its rules governing the 700 MHz
band in the 700 MHz Second Report and Order.114 An auction of A, B and E block 700
MHz licenses was held in 2008.115 Twenty winning bidders claimed small business status
(those with attributable average annual gross revenues that exceed $15 million and do not
exceed $40 million for the preceding three years). Thirty three winning bidders claimed


106 See Reallocation and Service Rules for the 698746 MHz Spectrum Band (Television Channels 5259),
Report and Order, 17 FCC Rcd 1022 (2002) ("Channels 5259 Report and Order").
107 See id., 17 FCC Rcd at 108788 172.
108 See id.
109 See id., 17 FCC Rcd at 1088 173.
110 See Alvarez Letter 1998.
111 See Lower 700 MHz Band Auction Closes, Public Notice, 17 FCC Rcd 17,272 (2002).
112 See Lower 700 MHz Band Auction Closes, Public Notice, 18 FCC Rcd 11,873 (2003).
113 See id.
114 700 MHz Second Report and Order, Second Report and Order, 22 FCC Rcd 15,289, 15,359 n.434
(2007).
115 See Auction of 700 MHz Band Licenses Closes, Public Notice, 23 FCC Rcd 4572 (2008).
21

Federal Communications Commission

FCC 11-151

very small business status (those with attributable average annual gross revenues that do
not exceed $15 million for the preceding three years).
60.
Offshore Radiotelephone Service. This service operates on several UHF
television broadcast channels that are not used for television broadcasting in the coastal
areas of states bordering the Gulf of Mexico. There are presently approximately 55
licensees in this service. The Commission is unable to estimate at this time the number
of licensees that would qualify as small under the SBA's small business size standard for
the category of Wireless Telecommunications Carriers (except Satellite). Under that
SBA small business size standard, a business is small if it has 1,500 or fewer employees.
Census data for 2007 show that there were 1,383 firms that operated that year. Of those
1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100
employees.116 Thus under this category and the associated small business size standard,
the majority of firms can be considered small.
61.
Government Transfer Bands. The Commission adopted small business size
standards for the unpaired 1390-1392 MHz, 1670-1675 MHz, and the paired 1392-1395
MHz and 1432-1435 MHz bands.117 Specifically, with respect to these bands, the
Commission defined an entity with average annual gross revenues for the three preceding
years not exceeding $40 million as a "small business," and an entity with average annual
gross revenues for the three preceding years not exceeding $15 million as a "very small
business."118 SBA has approved these small business size standards for the
aforementioned bands.119 Correspondingly, the Commission adopted a bidding credit of
15 percent for "small businesses" and a bidding credit of 25 percent for "very small
businesses."120 This bidding credit structure was found to have been consistent with the


116 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
117 See Amendments to Parts 1, 2, 27 and 90 of the Commission's Rules to License Services in the 216-220
MHz, 1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-
2390 MHz Government Transfer Bands
, Report and Order, 17 FCC Rcd 9980 (2002).
118 See Reallocation of the 216-220 MHz, 1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435
MHz, 1670-1675 MHz, and 2385-2390 MHz Government Transfer Bands
, WT Docket No. 02-8, Notice of
Proposed Rulemaking, 17 FCC Rcd 2500, 2550-51 144-146 (2002). To be consistent with the size
standard of "very small business" proposed for the 1427-1432 MHz band for those entities with average
gross revenues for the three preceding years not exceeding $3 million, the Service Rules Notice proposed to
use the terms "entrepreneur" and "small business" to define entities with average gross revenues for the
three preceding years not exceeding $40 million and $15 million, respectively. Because the Commission is
not adopting small business size standards for the 1427-1432 MHz band, it instead uses the terms "small
business" and "very small business" to define entities with average gross revenues for the three preceding
years not exceeding $40 million and $15 million, respectively.
119 See Letter from Hector V. Barreto, Administrator, Small Business Administration, to Margaret W.
Wiener, Chief, Auctions and Industry Analysis Division, Wireless Telecommunications Bureau, Federal
Communications Commission, dated Jan. 18, 2002.
120 Such bidding credits are codified for the unpaired 1390-1392 MHz, paired 1392-1395 MHz, and the
paired 1432-1435 MHz bands in 47 C.F.R. 27.807. Such bidding credits are codified for the unpaired
1670-1675 MHz band in 47 C.F.R. 27.906.
22

Federal Communications Commission

FCC 11-151

Commission's schedule of bidding credits, which may be found at section 1.2110(f)(2) of
the Commission's rules.121 The Commission found that these two definitions will provide
a variety of businesses seeking to provide a variety of services with opportunities to
participate in the auction of licenses for this spectrum and will afford such licensees, who
may have varying capital costs, substantial flexibility for the provision of services.122 The
Commission noted that it had long recognized that bidding preferences for qualifying
bidders provide such bidders with an opportunity to compete successfully against large,
well-financed entities.123 The Commission also noted that it had found that the use of
tiered or graduated small business definitions is useful in furthering its mandate under
Section 309(j) of the Act to promote opportunities for and disseminate licenses to a wide
variety of applicants.124 An auction for one license in the 1670-1674 MHz band
commenced on April 30, 2003 and closed the same day. One license was awarded. The
winning bidder was not a small entity.
b.

Certain Equipment Manufacturers and Stores

62.
Part 15 Handset Manufacturers. Manufacturers of unlicensed wireless
handsets may also become subject to requirements in this proceeding for their handsets
used to provide VoIP applications. The Commission has not developed a definition of
small entities applicable to unlicensed communications handset manufacturers.
Therefore, we will utilize the SBA definition applicable to Radio and Television
Broadcasting and Wireless Communications Equipment Manufacturing. The Census
Bureau defines this category as follows: "This industry comprises establishments
primarily engaged in manufacturing radio and television broadcast and wireless
communications equipment. Examples of products made by these establishments are:
transmitting and receiving antennas, cable television equipment, GPS equipment, pagers,
cellular phones, mobile communications equipment, and radio and television studio and
broadcasting equipment."125 The SBA has developed a small business size standard for


121 In the Part 1 Third Report and Order, the Commission adopted a standard schedule of bidding credits,
the levels of which were developed based on its auction experience. Part 1 Third Report and Order, 13
FCC Rcd at 403-04 47; see also 47 C.F.R. 1.2110(f)(2).
122 See Service Rules Notice, 17 FCC Rcd at 2550-51 145.
123 See, e.g., Revision of Part 22 and Part 90 of the Commission's Rules to Facilitate Future Development
of Paging Systems; Implementation of Section 309(j) of the Communications Act -- Competitive Bidding
,
WT Docket No. 96-18, PR Docket No. 93-253, Memorandum Opinion and Order on Reconsideration and
Third Report and Order, 14 FCC Rcd 10030, 10091 112 (1999).
124 47 U.S.C. 309(j)(3)(B), (4)(C)-(D). The Commission will also not adopt special preferences for
entities owned by minorities or women, and rural telephone companies. The Commission did not receive
any comments on this issue, and it does not have an adequate record to support such special provisions
under the current standards of judicial review. See Adarand Constructors v. Pea, 515 U.S. 200 (1995)
(requiring a strict scrutiny standard of review for government mandated race-conscious measures); United
States v. Virginia
, 518 U.S. 515 (1996) (applying an intermediate standard of review to a state program
based on gender classification).
125 U.S. Census Bureau, 2002 NAICS Definitions, 334220 Radio and Television Broadcasting and
Wireless Communications Equipment Manufacturing,
http://www.census.gov/epcd/naics02/def/NDEF334.HTM#N3342.
23

Federal Communications Commission

FCC 11-151

Radio and Television Broadcasting and Wireless Communications Equipment
Manufacturing, which is: all such firms having 750 or fewer employees.126 According to
Census Bureau data for 2007, there were a total of 939 establishments in this category
that operated for part or all of the entire year. Of this total, 784 had less than 500
employees and 155 had more than 100 employees.127 Thus, under this size standard, the
majority of firms can be considered small.
63.
Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. The Census Bureau defines this category as follows: "This
industry comprises establishments primarily engaged in manufacturing radio and
television broadcast and wireless communications equipment. Examples of products
made by these establishments are: transmitting and receiving antennas, cable television
equipment, GPS equipment, pagers, cellular phones, mobile communications equipment,
and radio and television studio and broadcasting equipment." The SBA has developed a
small business size standard for Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing which is: all such firms having 750 or fewer
employees. According to Census Bureau data for 2007, there were a total of 939
establishments in this category that operated for part or all of the entire year. Of this total,
784 had less than 500 employees and 155 had more than 100 employees."128 Thus, under
this size standard, the majority of firms can be considered small.
64.
Radio, Television, and Other Electronics Stores. The Census Bureau
defines this economic census category as follows: "This U.S. industry comprises: (1)
establishments known as consumer electronics stores primarily engaged in retailing a
general line of new consumer-type electronic products; (2) establishments specializing in
retailing a single line of consumer-type electronic products (except computers); or (3)
establishments primarily engaged in retailing these new electronic products in
combination with repair services."129 The SBA has developed a small business size
standard for Radio, Television, and Other Electronics Stores, which is: all such firms
having $9 million or less in annual receipts.130 According to Census Bureau data for
2007, there were 24,912 firms in this category that operated for the entire year.131 Of this
total, 22,701 firms had annual sales of under $5 million; 570 had annual sales and 533
firms had sales of $5 million or more but less than $10 million., and 1,641 had annual


126 13 C.F.R. 121.201, NAICS code 334220.
127 The NAICS Code for this service is 334220. See 13 C.F.R 121/201. See also
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=500&;-
ds_name=EC0744SSSZ1&-_lang=en.
128 The NAICS Code for this service 334220. See 13 C.F.R 121/201. See also
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=500&;-
ds_name=EC0744SSSZ1&-_lang=en.
129 http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=443112&search=2007%20NAICS%20Search.
130 13 C.F.R. 121.201, NAICS code 443112.
131 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&;-
_skip=500&-ds_name=EC0744SSSZ1&-_lang=en.
24

Federal Communications Commission

FCC 11-151

sales of over 10 million.132 Thus, the majority of firms in this category can be considered
small.
c.

Wireline Carriers and Service Providers

65.
Incumbent Local Exchange Carriers (Incumbent LECs). Neither the
Commission nor the SBA has developed a small business size standard specifically for
incumbent local exchange services. The appropriate size standard under SBA rules is for
the category Wired Telecommunications Carriers. Under that size standard, such a
business is small if it has 1,500 or fewer employees.133 Census Bureau data for 2007
shows that there were 3,188 firms in this category that operated for the entire year. Of
this total, 3,144 had employment of 999 or fewer, and 44 firms had employment of 1000
or more. According to Commission data, 1,307 carriers reported that they were
incumbent local exchange service providers.134 Of these 1,307 carriers, an estimated
1,006 have 1,500 or fewer employees and 301 have more than 1,500 employees.135
Consequently, the Commission estimates that most providers of local exchange service
are small entities that may be affected by the rules proposed in the NPRM. Thus under
this category, the majority of these incumbent local exchange service providers can be
considered small.136
66.
Competitive Local Exchange Carriers (Competitive LECs), Competitive
Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service
Providers.
Neither the Commission nor the SBA has developed a small business size
standard specifically for these service providers. The appropriate size standard under
SBA rules is for the category Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.137 Census Bureau
data for 2007 show that there were 3,188 firms in this category that operated for the
entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had had
employment of 1,000 employees or more. Thus under this category and the associated
small business size standard, the majority of these Competitive LECs, CAPs, Shared-
Tenant Service Providers, and Other Local Service Providers can be considered small
entities.138 According to Commission data, 1,442 carriers reported that they were
engaged in the provision of either competitive local exchange services or competitive


132 Id.
133 13 C.F.R. 121.201, NAICS code 517110.
134 See Trends in Telephone Service, Federal Communications Commission, Wireline Competition Bureau,
Industry Analysis and Technology Division at Table 5.3 (Sept. 2010) (Trends in Telephone Service).
135 See id.
136 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
137 13 C.F.R. 121.201, NAICS code 517110.
138 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
25

Federal Communications Commission

FCC 11-151

access provider services.139 Of these 1,442 carriers, an estimated 1,256 have 1,500 or
fewer employees and 186 have more than 1,500 employees.140 In addition, 17 carriers
have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to
have 1,500 or fewer employees.141 In addition, 72 carriers have reported that they are
Other Local Service Providers.142 Of the 72, seventy have 1,500 or fewer employees and
two have more than 1,500 employees.143 Consequently, the Commission estimates that
most providers of competitive local exchange service, competitive access providers,
Shared-Tenant Service Providers, and Other Local Service Providers are small entities
that may be affected by rules adopted pursuant to the NPRM.
67.
Interexchange Carriers. Neither the Commission nor the SBA has
developed a small business size standard specifically for providers of interexchange
services. The appropriate size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business is small if it has
1,500 or fewer employees.144 Census Bureau data for 2007 shows that there were 3,188
firms in this category that operated for the entire year. Of this total, 3,144 had
employment of 999 or fewer, and 44 firms had had employment of 1,000 employees or
more. Thus under this category and the associated small business size standard, the
majority of these Interexchange carriers can be considered small entities.145 According to
Commission data, 359 companies reported that their primary telecommunications service
activity was the provision of interexchange services.146 Of these 359 companies, an
estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 employees.147
Consequently, the Commission estimates that the majority of interexchange service
providers are small entities that may be affected by rules adopted pursuant to the NPRM.
68.
Operator Service Providers (OSPs). Neither the Commission nor the
SBA has developed a small business size standard specifically for operator service
providers. The appropriate size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business is small if it has
1,500 or fewer employees.148 Census Bureau data for 2007 show that there were 3,188
firms in this category that operated for the entire year. Of this total, 3,144 had


139 See Trends in Telephone Service, at tbl. 5.3.
140 Id.
141 Id.
142 Id.
143 Id.
144 13 C.F.R. 121.201, NAICS code 517110.
145 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
146 See Trends in Telephone Service, at tbl. 5.3.
147 Id.
148 13 C.F.R. 121.201, NAICS code 517110.
26

Federal Communications Commission

FCC 11-151

employment of 999 or fewer, and 44 firms had had employment of 1,000 employees or
more. Thus under this category and the associated small business size standard, the
majority of these Interexchange carriers can be considered small entities.149.According to
Commission data, 33 carriers have reported that they are engaged in the provision of
operator services. Of these, an estimated 31 have 1,500 or fewer employees and 2 have
more than 1,500 employees.150 Consequently, the Commission estimates that the majority
of OSPs are small entities that may be affected by our proposed rules.
69.
Local Resellers. The SBA has developed a small business size standard
for the category of Telecommunications Resellers. Under that size standard, such a
business is small if it has 1,500 or fewer employees.151 Census data for 2007 show that
1,523 firms provided resale services during that year. Of that number, 1,522 operated
with fewer than 1000 employees and one operated with more than 1,000.152 Thus under
this category and the associated small business size standard, the majority of these local
resellers can be considered small entities. According to Commission data, 213 carriers
have reported that they are engaged in the provision of local resale services.153 Of these,
an estimated 211 have 1,500 or fewer employees and two have more than 1,500
employees.154 Consequently, the Commission estimates that the majority of local
resellers are small entities that may be affected by rules adopted pursuant to the Notice.
70.
Toll Resellers. The SBA has developed a small business size standard for
the category of Telecommunications Resellers. Under that size standard, such a business
is small if it has 1,500 or fewer employees.155 Census data for 2007 show that 1,523 firms
provided resale services during that year. Of that number, 1,522 operated with fewer
than 1,000 employees and one operated with more than 1,000.156 Thus under this category
and the associated small business size standard, the majority of these resellers can be
considered small entities. According to Commission data,157 881 carriers have reported
that they are engaged in the provision of toll resale services. Of these, an estimated 857
have 1,500 or fewer employees and 24 have more than 1,500 employees. Consequently,


149 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
150 Trends in Telephone Service, at tbl. 5.3.
151 13 C.F.R. 121.201, NAICS code 517911.
152 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&;-
ds_name=EC0751SSSZ5&-_lang=en.
153 See Trends in Telephone Service, at tbl. 5.3.
154 Id.
155 13 C.F.R. 121.201, NAICS code 517911.
156 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&;-
ds_name=EC0751SSSZ5&-_lang=en.
157 Trends in Telephone Service, at tbl. 5.3.
27

Federal Communications Commission

FCC 11-151

the Commission estimates that the majority of toll resellers are small entities that may be
affected by our proposed rules.
71.
Payphone Service Providers (PSPs). Neither the Commission nor the
SBA has developed a small business size standard specifically for payphone services
providers. The appropriate size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business is small if it has
1,500 or fewer employees.158 Census Bureau data for 2007 shows that there were 3,188
firms in this category that operated for the entire year. Of this total, 3,144 had
employment of 999 or fewer, and 44 firms had had employment of 1,000 employees or
more. Thus under this category and the associated small business size standard, the
majority of these PSPs can be considered small entities.159. According to Commission
data,160 657 carriers have reported that they are engaged in the provision of payphone
services. Of these, an estimated 653 have 1,500 or fewer employees and four have more
than 1,500 employees. Consequently, the Commission estimates that the majority of
payphone service providers are small entities that may be affected by our action.
72.
Prepaid Calling Card Providers. Neither the Commission nor the SBA
has developed a small business size standard specifically for prepaid calling card
providers. The appropriate size standard under SBA rules is for the category
Telecommunications Resellers. Under that size standard, such a business is small if it has
1,500 or fewer employees.161 Census data for 2007 show that 1,523 firms provided resale
services during that year. Of that number, 1,522 operated with fewer than 1000
employees and one operated with more than 1,000.162 Thus under this category and the
associated small business size standard, the majority of these prepaid calling card
providers can be considered small entities. According to Commission data, 193 carriers
have reported that they are engaged in the provision of prepaid calling cards.163 Of these,
all 193 have 1,500 or fewer employees and none have more than 1,500 employees.164
Consequently, the Commission estimates that the majority of prepaid calling card
providers are small entities that may be affected by rules adopted pursuant to the Notice.
73.
800 and 800-Like Service Subscribers.165 Neither the Commission nor the
SBA has developed a small business size standard specifically for 800 and 800-like


158 13 C.F.R. 121.201, NAICS code 517110.
159 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&;-
_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
160 Trends in Telephone Service, at tbl. 5.3.
161 13 C.F.R. 121.201, NAICS code 517911.
162 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&;-
ds_name=EC0751SSSZ5&-_lang=en.
163 See Trends in Telephone Service, at tbl. 5.3.
164 Id.
165 We include all toll-free number subscribers in this category, including those for 888 numbers.
28

Federal Communications Commission

FCC 11-151

service ("toll free") subscribers. The appropriate size standard under SBA rules is for the
category Telecommunications Resellers. Under that size standard, such a business is
small if it has 1,500 or fewer employees.166 Census data for 2007 show that 1,523 firms
provided resale services during that year. Of that number, 1,522 operated with fewer
than 1000 employees and one operated with more than 1,000.167 Thus under this category
and the associated small business size standard, the majority of resellers in this
classification can be considered small entities. To focus specifically on the number of
subscribers than on those firms which make subscription service available, the most
reliable source of information regarding the number of these service subscribers appears
to be data the Commission collects on the 800, 888, 877, and 866 numbers in use.168
According to our data for September 2009, the number of 800 numbers assigned was
7,860,000; the number of 888 numbers assigned was 5,888,687; the number of 877
numbers assigned was 4, 721,866; and the number of 866 numbers assigned was 7,
867,736. The Commission does not have data specifying the number of these subscribers
that are not independently owned and operated or have more than 1,500 employees, and
thus are unable at this time to estimate with greater precision the number of toll free
subscribers that would qualify as small businesses under the SBA size standard.
Consequently, the Commission estimates that there are 7,860.000 or fewer small entity
800 subscribers; 5,888,687 or fewer small entity 888 subscribers; 4,721,866 or fewer
small entity 877 subscribers; and 7,867,736 or fewer small entity 866 subscribers.
d.

Wireless Carriers and Service Providers

74.
Below, for those services where licenses are subject to auctions, the
Commission notes that, as a general matter, the number of winning bidders that qualify as
small businesses at the close of a given auction does not necessarily represent the number
of small businesses currently in service. Also, the Commission does not generally track
subsequent business size unless, in the context of assignments or transfers, unjust
enrichment issues are implicated.
75.
Wireless Telecommunications Carriers (except Satellite). Since 2007, the
Census Bureau has placed wireless firms within this new, broad, economic census
category.169 Prior to that time, such firms were within the now-superseded categories of
"Paging" and "Cellular and Other Wireless Telecommunications."170 Under the present


166 13 C.F.R. 121.201, NAICS code 517911.
167 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=800&;-
ds_name=EC0751SSSZ5&-_lang=en.
168 Trends in Telephone Service, at tbls. 18.4, 18.5, 18.6, 18.7.
169 U.S. Census Bureau, 2007 NAICS Definitions, 517210 Wireless Telecommunications Categories
(Except Satellite), http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
170 U.S. Census Bureau, 2002 NAICS Definitions, 517211 Paging,
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. Census Bureau, 2002 NAICS Definitions,
"517212 Cellular and Other Wireless Telecommunications";
http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
29

Federal Communications Commission

FCC 11-151

and prior categories, the SBA has deemed a wireless business to be small if it has 1,500
or fewer employees.171 For the category of Wireless Telecommunications Carriers
(except Satellite), Census data for 2007 shows that there were 1,383 firms that operated
that year.172 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more
than 100 employees. Thus under this category and the associated small business size
standard, the majority of firms can be considered small. Similarly, according to
Commission data, 413 carriers reported that they were engaged in the provision of
wireless telephony, including cellular service, Personal Communications Service
("PCS"), and Specialized Mobile Radio ("SMR") Telephony services.173 Of these, an
estimated 261 have 1,500 or fewer employees and 152 have more than 1,500
employees.174 Consequently, the Commission estimates that approximately half or more
of these firms can be considered small. Thus, using available data, we estimate that the
majority of wireless firms can be considered small.
76.
Wireless Communications Services. This service can be used for fixed,
mobile, radiolocation, and digital audio broadcasting satellite uses. The Commission
defined "small business" for the wireless communications services ("WCS") auction as
an entity with average gross revenues of $40 million for each of the three preceding
years, and a "very small business" as an entity with average gross revenues of $15
million for each of the three preceding years.175 The SBA has approved these
definitions.176 The Commission auctioned geographic area licenses in the WCS service.
In the auction, which commenced on April 15, 1997 and closed on April 25, 1997, seven
bidders won 31 licenses that qualified as very small business entities, and one bidder won
one license that qualified as a small business entity.
77.
Common Carrier Paging. The SBA considers paging to be a wireless
telecommunications service and classifies it under the industry classification Wireless
Telecommunications Carriers (except satellite). Under that classification, the applicable
size standard is that a business is small if it has 1,500 or fewer employees. For the
general category of Wireless Telecommunications Carriers (except Satellite), Census data


171 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R.
citations were 13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
172 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
173 See Trends in Telephone Service, at tbl. 5.3.
174 Id.
175 Amendment of the Commission's Rules to Establish Part 27, the Wireless Communications Service
(WCS), GN Docket No. 96-228, Report and Order, 12 FCC Rcd 10785, 10879 194 (1997).
176 See Letter from Aida Alvarez, Administrator, SBA, to Amy Zoslov, Chief, Auctions and Industry
Analysis Division, Wireless Telecommunications Bureau, FCC (filed Dec. 2, 1998) (Alvarez Letter 1998).
30

Federal Communications Commission

FCC 11-151

for 2007 shows that there were 1,383 firms that operated that year.177 Of those 1,383,
1,368 had fewer than 100 employees, and 15 firms had more than 100 employees. Thus
under this category and the associated small business size standard, the majority of firms
can be considered small.178 The 2007 census also contains data for the specific category
of "Paging" "that is classified under the seven-number NAICS code 5172101.179
According to Commission data, 291 carriers have reported that they are engaged in
Paging or Messaging Service. Of these, an estimated 289 have 1,500 or fewer
employees, and 2 have more than 1,500 employees.180 Consequently, the Commission
estimates that the majority of paging providers are small entities that may be affected by
our action.
78.
Wireless Telephony. Wireless telephony includes cellular, personal
communications services, and specialized mobile radio telephony carriers. As noted, the
SBA has developed a small business size standard for Wireless Telecommunications
Carriers (except Satellite).181 Under the SBA small business size standard, a business is
small if it has 1,500 or fewer employees.182 Census data for 2007 shows that there were
1,383 firms that operated that year.183 Of those 1,383, 1,368 had fewer than 100
employees, and 15 firms had more than 100 employees. Thus under this category and the
associated small business size standard, the majority of firms can be considered small.
According to Trends in Telephone Service data, 434 carriers reported that they were
engaged in wireless telephony.184 Of these, an estimated 222 have 1,500 or fewer
employees and 212 have more than 1,500 employees.185 Therefore, approximately half of
these entities can be considered small. Similarly, according to Commission data, 413
carriers reported that they were engaged in the provision of wireless telephony, including
cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio


177 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
178 13 C.F.R. 121.201, NAICS code 517210.
179http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en In this specific category, there were 248 firms that operated for the
entire year in 2007. Of that number 247 operated with fewer than 100 employees and one (1) operated with
more than 1000 employees. Based on this classification and the associated size standard, the majority of
paging firms must be considered small.
180 See Trends in Telephone Service, at tbl. 5.3.
181 13 C.F.R. 121.201, NAICS code 517210.
182 Id.
183 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
184 Trends in Telephone Service, at tbl. 5.3.
185 Id.
31

Federal Communications Commission

FCC 11-151

(SMR) Telephony services.186 Of these, an estimated 261 have 1,500 or fewer employees
and 152 have more than 1,500 employees.187 Consequently, the Commission estimates
that approximately half or more of these firms can be considered small. Thus, using
available data, we estimate that the majority of wireless firms can be considered small.
79.
Broadband Personal Communications Service. The broadband personal
communications services (PCS) spectrum is divided into six frequency blocks designated
A through F, and the Commission has held auctions for each block. The Commission
initially defined a "small business" for C- and F-Block licenses as an entity that has
average gross revenues of $40 million or less in the three previous calendar years.188 For
F-Block licenses, an additional small business size standard for "very small business"
was added and is defined as an entity that, together with its affiliates, has average gross
revenues of not more than $15 million for the preceding three calendar years.189 These
small business size standards, in the context of broadband PCS auctions, have been
approved by the SBA.190 No small businesses within the SBA-approved small business
size standards bid successfully for licenses in Blocks A and B. There were 90 winning
bidders that claimed small business status in the first two C-Block auctions. A total of 93
bidders that claimed small business status won approximately 40 percent of the 1,479
licenses in the first auction for the D, E, and F Blocks.191 On April 15, 1999, the
Commission completed the re-auction of 347 C-, D-, E-, and F-Block licenses in Auction
No. 22.192 Of the 57 winning bidders in that auction, 48 claimed small business status and
won 277 licenses.
80.
On January 26, 2001, the Commission completed the auction of 422 C and
F Block Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in that
auction, 29 claimed small business status.193 Subsequent events concerning Auction 35,
including judicial and agency determinations, resulted in a total of 163 C and F Block


186 See Trends in Telephone Service, at tbl. 5.3.
187 See id.
188 See Amendment of Parts 20 and 24 of the Commission's Rules Broadband PCS Competitive Bidding
and the Commercial Mobile Radio Service Spectrum Cap; Amendment of the Commission's Cellular/PCS
Cross-Ownership Rule
, WT Docket No. 96-59, GN Docket No. 90-314, Report and Order, 11 FCC Rcd
7824, 785052 5760 (1996) ("PCS Report and Order"); see also 47 C.F.R. 24.720(b).
189 See PCS Report and Order, 11 FCC Rcd at 7852 60.
190 See Alvarez Letter 1998.
191 See Broadband PCS, D, E and F Block Auction Closes, Public Notice, Doc. No. 89838 (rel. Jan. 14,
1997).
192 See C, D, E, and F Block Broadband PCS Auction Closes, Public Notice, 14 FCC Rcd 6688 (WTB
1999). Before Auction No. 22, the Commission established a very small standard for the C Block to match
the standard used for F Block. Amendment of the Commission's Rules Regarding Installment Payment
Financing for Personal Communications Services (PCS) Licensees
, WT Docket No. 97-82, Fourth Report
and Order, 13 FCC Rcd 15743, 15768 46 (1998).
193 See C and F Block Broadband PCS Auction Closes; Winning Bidders Announced, Public Notice, 16
FCC Rcd 2339 (2001).
32

Federal Communications Commission

FCC 11-151

licenses being available for grant. On February 15, 2005, the Commission completed an
auction of 242 C-, D-, E-, and F-Block licenses in Auction No. 58. Of the 24 winning
bidders in that auction, 16 claimed small business status and won 156 licenses.194 On
May 21, 2007, the Commission completed an auction of 33 licenses in the A, C, and F
Blocks in Auction No. 71.195 Of the 12 winning bidders in that auction, five claimed
small business status and won 18 licenses.196 On August 20, 2008, the Commission
completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS licenses in Auction
No. 78.197 Of the eight winning bidders for Broadband PCS licenses in that auction, six
claimed small business status and won 14 licenses.198
81.
Narrowband Personal Communications Services. To date, two auctions
of narrowband personal communications services ("PCS") licenses have been conducted.
For purposes of the two auctions that have already been held, "small businesses" were
entities with average gross revenues for the prior three calendar years of $40 million or
less. Through these auctions, the Commission has awarded a total of 41 licenses, out of
which 11 were obtained by small businesses. To ensure meaningful participation of
small business entities in future auctions, the Commission has adopted a two-tiered small
business size standard in the Narrowband PCS Second Report and Order.199 A "small
business" is an entity that, together with affiliates and controlling interests, has average
gross revenues for the three preceding years of not more than $40 million. A "very small
business" is an entity that, together with affiliates and controlling interests, has average
gross revenues for the three preceding years of not more than $15 million. The SBA has
approved these small business size standards.200 A third auction of Narrowband PCS
licenses was conducted in 2001. In that auction, five bidders won 317 Metropolitan
Trading Areas and nationwide licenses.201 Three of the winning bidders claimed status as
a small or very small entity and won 311 licenses.


194 See Broadband PCS Spectrum Auction Closes; Winning Bidders Announced for Auction No. 58, Public
Notice, 20 FCC Rcd 3703 (2005).
195 See Auction of Broadband PCS Spectrum Licenses Closes; Winning Bidders Announced for Auction No.
71,
Public Notice, 22 FCC Rcd 9247 (2007).
196 Id.
197 See Auction of AWS-1 and Broadband PCS Licenses Closes; Winning Bidders Announced for Auction
78
, Public Notice, 23 FCC Rcd 12749 (WTB 2008).
198 Id.
199 Amendment of the Commission's Rules to Establish New Personal Communications Services,
Narrowband PCS
, GEN Docket No. 90-314, ET Docket No. 92-100, PP Docket No. 93-253, Second
Report and Order and Second Further Notice of Proposed Rulemaking, 15 FCC Rcd 10456 (2000)
("Narrowband PCS Second Report and Order").
200 See Letter to Amy Zoslov, Chief, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, FCC, from Aida Alvarez, Administrator, SBA (Dec. 2, 1998).
201 See Narrowband PCS Auction Closes, Public Notice, 16 FCC Rcd 18663 (WTB 2001).
33

Federal Communications Commission

FCC 11-151

82.
220 MHz Radio Service Phase I Licensees. The 220 MHz service has
both Phase I and Phase II licenses. Phase I licensing was conducted by lotteries in 1992
and 1993. There are approximately 1,515 such non-nationwide licensees and four
nationwide licensees currently authorized to operate in the 220 MHz band. The
Commission has not developed a small business size standard for small entities
specifically applicable to such incumbent 220 MHz Phase I licensees. To estimate the
number of such licensees that are small businesses, the Commission applies the small
business size standard under the SBA rules applicable. The SBA has deemed a wireless
business to be small if it has 1,500 or fewer employees.202 For this service, the SBA uses
the category of Wireless Telecommunications Carriers (except Satellite). Census data for
2007, which supersede data contained in the 2002 Census, show that there were 1,383
firms that operated that year.203 Of those 1,383, 1,368 had fewer than 100 employees, and
15 firms had more than 100 employees. Thus under this category and the associated
small business size standard, the majority of firms can be considered small.
83.
220 MHz Radio Service Phase II Licensees. The 220 MHz service has both
Phase I and Phase II licenses. The Phase II 220 MHz service is a new service, and is
subject to spectrum auctions. In the 220 MHz Third Report and Order, the Commission
adopted a small business size standard for defining "small" and "very small" businesses
for purposes of determining their eligibility for special provisions such as bidding credits
and installment payments.204 This small business standard indicates that a "small
business" is an entity that, together with its affiliates and controlling principals, has
average gross revenues not exceeding $15 million for the preceding three years.205 A
"very small business" is defined as an entity that, together with its affiliates and
controlling principals, has average gross revenues that do not exceed $3 million for the
preceding three years.206 The SBA has approved these small size standards.207 Auctions
of Phase II licenses commenced on and closed in 1998.208 In the first auction, 908
licenses were auctioned in three different-sized geographic areas: three nationwide
licenses, 30 Regional Economic Area Group (EAG) Licenses, and 875 Economic Area


202 13 C.F.R. 121.201, NAICS code 517210 (2007 NAICS). The now-superseded, pre-2007 C.F.R.
citations were 13 C.F.R. 121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).
203 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
204 Amendment of Part 90 of the Commission's Rules to Provide For the Use of the 220-222 MHz Band by
the Private Land Mobile Radio Service
, Third Report and Order, 12 FCC Rcd 10943, 11068-70 291-295
(1997).
205 Id. at 11068 291.
206 Id.
207 See Letter to Daniel Phythyon, Chief, Wireless Telecommunications Bureau, Federal Communications
Commission, from Aida Alvarez, Administrator, Small Business Administration, dated January 6, 1998
(Alvarez to Phythyon Letter 1998).
208 See generally 220 MHz Service Auction Closes, Public Notice, 14 FCC Rcd 605 (WTB 1998).
34

Federal Communications Commission

FCC 11-151

(EA) Licenses. Of the 908 licenses auctioned, 693 were sold.209 Thirty-nine small
businesses won 373 licenses in the first 220 MHz auction. A second auction included
225 licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies claiming small
business status won 158 licenses.210 A third auction included four licenses: 2 BEA
licenses and 2 EAG licenses in the 220 MHz Service. No small or very small business
won any of these licenses.211 In 2007, the Commission conducted a fourth auction of the
220 MHz licenses.212 Bidding credits were offered to small businesses. A bidder with
attributed average annual gross revenues that exceeded $3 million and did not exceed $15
million for the preceding three years ("small business") received a 25 percent discount on
its winning bid. A bidder with attributed average annual gross revenues that did not
exceed $3 million for the preceding three years received a 35 percent discount on its
winning bid ("very small business"). Auction 72, which offered 94 Phase II 220 MHz
Service licenses, concluded in 2007.213 In this auction, five winning bidders won a total
of 76 licenses. Two winning bidders identified themselves as very small businesses won
56 of the 76 licenses. One of the winning bidders that identified themselves as a small
business won 5 of the 76 licenses won.
84.
800 MHz and 900 MHz Specialized Mobile Radio Licenses. The
Commission awards small business bidding credits in auctions for Specialized Mobile
Radio ("SMR") geographic area licenses in the 800 MHz and 900 MHz bands to entities
that had revenues of no more than $15 million in each of the three previous calendar
years.214 The Commission awards very small business bidding credits to entities that had
revenues of no more than $3 million in each of the three previous calendar years.215 The
SBA has approved these small business size standards for the 800 MHz and 900 MHz
SMR Services.216 The Commission has held auctions for geographic area licenses in the
800 MHz and 900 MHz bands. The 900 MHz SMR auction was completed in 1996.217


209 See FCC Announces It is Prepared to Grant 654 Phase II 220 MHz Licenses After Final Payment is
Made
, Public Notice, 14 FCC Rcd 1085 (WTB 1999).
210 See Phase II 220 MHz Service Spectrum Auction Closes, Public Notice, 14 FCC Rcd 11218 (WTB
1999).
211 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
212 See Auction of Phase II 220 MHz Service Spectrum Scheduled for June 20, 2007, Notice and Filing
Requirements, Minimum Opening Bids, Upfront Payments and Other Procedures for Auction 72
, Public
Notice, 22 FCC Rcd 3404 (2007).
213 See Auction of Phase II 220 MHz Service Spectrum Licenses Closes, Winning Bidders Announced for
Auction 72, Down Payments due July 18, 2007, FCC Forms 601 and 602 due July 18, 2007, Final
Payments due August 1, 2007, Ten-Day Petition to Deny Period
, Public Notice, 22 FCC Rcd 11573 (2007).
214 47 C.F.R. 90.810, 90.814(b), 90.912.
215 Id.
216 See Alvarez Letter 1999.
217 FCC Announces Winning Bidders in the Auction of 1,020 Licenses to Provide 900 MHz SMR in Major
Trading Areas: Down Payments due April 22, 1996, FCC Form 600s due April 29, 1996
, Public Notice, 11
FCC Rcd 18599 (WTB 1996).
35

Federal Communications Commission

FCC 11-151

Sixty bidders claiming that they qualified as small businesses under the $15 million size
standard won 263 geographic area licenses in the 900 MHz SMR band.218 The 800 MHz
SMR auction for the upper 200 channels was conducted in 1997. Ten bidders claiming
that they qualified as small businesses under the $15 million size standard won 38
geographic area licenses for the upper 200 channels in the 800 MHz SMR band.219 A
second auction for the 800 MHz band was conducted in 2002 and included 23 BEA
licenses. One bidder claiming small business status won five licenses.220
85.
The auction of the 1,053 800 MHz SMR geographic area licenses for the
General Category channels was conducted in 2000. Eleven bidders won 108 geographic
area licenses for the General Category channels in the 800 MHz SMR band qualified as
small businesses under the $15 million size standard.221 In an auction completed in 2000,
a total of 2,800 Economic Area licenses in the lower 80 channels of the 800 MHz SMR
service were awarded.222 Of the 22 winning bidders, 19 claimed small business status and
won 129 licenses. Thus, combining all three auctions, 40 winning bidders for geographic
licenses in the 800 MHz SMR band claimed status as small business.
86.
In addition, there are numerous incumbent site-by-site SMR licensees and
licensees with extended implementation authorizations in the 800 and 900 MHz bands.
We do not know how many firms provide 800 MHz or 900 MHz geographic area SMR
pursuant to extended implementation authorizations, nor how many of these providers
have annual revenues of no more than $15 million. One firm has over $15 million in
revenues. In addition, we do not know how many of these firms have 1,500 or fewer
employees.223 We assume, for purposes of this analysis, that all of the remaining existing
extended implementation authorizations are held by small entities, as that small business
size standard is approved by the SBA.
87.
Air-Ground Radiotelephone Service. The Commission has previously
used the SBA's small business size standard applicable to Wireless Telecommunications
Carriers (except Satellite), i.e., an entity employing no more than 1,500 persons.224 There
are approximately 100 licensees in the Air-Ground Radiotelephone Service, and under
that definition, the Commission estimates that almost all of them qualify as small entities


218 Id.
219 See Correction to Public Notice DA 96-586, FCC Announces Winning Bidders in the Auction of 1020
Licenses to Provide 900 MHz SMR in Major Trading Areas,
Public Notice, 11 FCC Rcd 18637 (WTB
1996).

220 See Multi-Radio Service Auction Closes, Public Notice, 17 FCC Rcd 1446 (WTB 2002).
221 See 800 MHz Specialized Mobile Radio (SMR) Service General Category (851-854 MHz) and Upper
Band (861-865 MHz) Auction Closes; Winning Bidders Announced,
Public Notice, 15 FCC Rcd 17162
(WTB 2000).

222 See 800 MHz SMR Service Lower 80 Channels Auction Closes; Winning Bidders Announced, Public
Notice, 16 FCC Rcd 1736 (WTB 2000).
223 See generally 13 C.F.R. 121.201, NAICS code 517210.
224 13 C.F.R. 121.201, NAICS codes 517210.
36

Federal Communications Commission

FCC 11-151

under the SBA definition. For purposes of assigning Air-Ground Radiotelephone Service
licenses through competitive bidding, the Commission has defined "small business" as an
entity that, together with controlling interests and affiliates, has average annual gross
revenues for the preceding three years not exceeding $40 million.225 A "very small
business" is defined as an entity that, together with controlling interests and affiliates, has
average annual gross revenues for the preceding three years not exceeding $15 million.226
These definitions were approved by the SBA.227 In May 2006, the Commission
completed an auction of nationwide commercial Air-Ground Radiotelephone Service
licenses in the 800 MHz band (Auction No. 65). On June 2, 2006, the auction closed
with two winning bidders winning two Air-Ground Radiotelephone Services licenses.
Neither of the winning bidders claimed small business status.
88.
Rural Radiotelephone Service. The Commission has not adopted a size
standard for small businesses specific to the Rural Radiotelephone Service.228 A
significant subset of the Rural Radiotelephone Service is the Basic Exchange Telephone
Radio System ("BETRS").229 For purposes of its analysis of the Rural Radiotelephone
Service, the Commission uses the SBA small business size standard for the category
Wireless Telecommunications Carriers (except satellite)," which is 1,500 or fewer
employees.230 Census data for 2007 shows that there were 1,383 firms that operated that
year.231 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more
than 100 employees. Thus under this category and the associated small business size
standard, the majority of firms in the Rural Radiotelephone Service can be considered
small.
89.
Aviation and Marine Radio Services. Small businesses in the aviation and
marine radio services use a very high frequency ("VHF") marine or aircraft radio and, as
appropriate, an emergency position-indicating radio beacon (and/or radar) or an
emergency locator transmitter. The Commission has not developed a small business size


225 Amendment of Part 22 of the Commission's Rules to Benefit the Consumers of Air-Ground
Telecommunications Services, Biennial Regulatory Review--Amendment of Parts 1, 22, and 90 of the
Commission's Rules, Amendment of Parts 1 and 22 of the Commission's Rules to Adopt Competitive
Bidding Rules for Commercial and General Aviation Air-Ground Radiotelephone Service
, WT Docket Nos.
03-103, 05-42, Order on Reconsideration and Report and Order, 20 FCC Rcd 19663 2842 (2005).
226 Id.
227 See Letter from Hector V. Barreto, Administrator, SBA, to Gary D. Michaels, Deputy Chief, Auctions
and Spectrum Access Division, Wireless Telecommunications Bureau, FCC (filed Sept. 19, 2005).
228 The service is defined in section 22.99 of the Commission's Rules, 47 C.F.R. 22.99.
229 BETRS is defined in sections 22.757 and 22.759 of the Commission's Rules, 47 C.F.R. 22.757 and
22.759.
230 13 C.F.R. 121.201, NAICS code 517210.
231 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
37

Federal Communications Commission

FCC 11-151

standard specifically applicable to these small businesses. For purposes of this analysis,
the Commission uses the SBA small business size standard for the category Wireless
Telecommunications Carriers (except satellite)," which is 1,500 or fewer employees.232
Census data for 2007 shows that there were 1,383 firms that operated that year.233 Of
those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100
employees. Thus under this category and the associated small business size standard, the
majority of firms can be considered small.
90.
Fixed Microwave Services. Microwave services include common
carrier,234 private-operational fixed,235 and broadcast auxiliary radio services.236 They also
include the Local Multipoint Distribution Service ("LMDS"),237 the Digital Electronic
Message Service ("DEMS"),238 and the 24 GHz Service,239 where licensees can choose
between common carrier and non-common carrier status.240 The Commission has not yet
defined a small business with respect to microwave services. For purposes of this IRFA,
the Commission will use the SBA's definition applicable to Wireless
Telecommunications Carriers (except satellite)--i.e., an entity with no more than 1,500
persons is considered small.241 For the category of Wireless Telecommunications
Carriers (except Satellite), Census data for 2007 shows that there were 1,383 firms that
operated that year.242 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms
had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small. The Commission
notes that the number of firms does not necessarily track the number of licensees. The


232 13 C.F.R. 121.201, NAICS code 517210.
233 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
234 See 47 C.F.R. Part 101, Subparts C and I.
235 See id. Subparts C and H.
236 Auxiliary Microwave Service is governed by Part 74 of Title 47 of the Commission's Rules. See 47
C.F.R. Part 74. Available to licensees of broadcast stations and to broadcast and cable network entities,
broadcast auxiliary microwave stations are used for relaying broadcast television signals from the studio to
the transmitter, or between two points such as a main studio and an auxiliary studio. The service also
includes mobile TV pickups, which relay signals from a remote location back to the studio.
237 See 47 C.F.R. Part 101, Subpart L.
238 See id. Subpart G.
239 See id.
240 See 47 C.F.R. 101.533, 101.1017.
241 13 C.F.R. 121.201, NAICS code 517210.
242 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
38

Federal Communications Commission

FCC 11-151

Commission estimates that virtually all of the Fixed Microwave licensees (excluding
broadcast auxiliary licensees) would qualify as small entities under the SBA definition.
91.
Offshore Radiotelephone Service. This service operates on several UHF
television broadcast channels that are not used for television broadcasting in the coastal
areas of states bordering the Gulf of Mexico.243 There are presently approximately 55
licensees in this service. The Commission is unable to estimate at this time the number
of licensees that would qualify as small under the SBA's small business size standard for
the category of Wireless Telecommunications Carriers (except Satellite). Under that
standard.244 Under that SBA small business size standard, a business is small if it has
1,500 or fewer employees.245 Census data for 2007 shows that there were 1,383 firms that
operated that year.246 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms
had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small.
92.
39 GHz Service. The Commission created a special small business size
standard for 39 GHz licenses an entity that has average gross revenues of $40 million or
less in the three previous calendar years.247 An additional size standard for "very small
business" is: an entity that, together with affiliates, has average gross revenues of not
more than $15 million for the preceding three calendar years.248 The SBA has approved
these small business size standards.249 The auction of the 2,173 39 GHz licenses began on
April 12, 2000 and closed on May 8, 2000. The 18 bidders who claimed small business
status won 849 licenses. Consequently, the Commission estimates that 18 or fewer 39
GHz licensees are small entities that may be affected by our action.
93.
Wireless Cable Systems. Broadband Radio Service and Educational
Broadband Service. Broadband Radio Service systems, previously referred to as
Multipoint Distribution Service ("MDS") and Multichannel Multipoint Distribution
Service ("MMDS") systems, and "wireless cable," transmit video programming to
subscribers and provide two-way high speed data operations using the microwave
frequencies of the Broadband Radio Service ("BRS") and Educational Broadband Service


243 This service is governed by Subpart I of Part 22 of the Commission's Rules. See 47 C.F.R. 22.1001-
22.1037.
244 13 C.F.R. 121.201, NAICS code 517210.
245 Id.
246 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
247 See Amendment of the Commission's Rules Regarding the 37.0-38.6 GHz and 38.6-40.0 GHz Bands,
ET Docket No. 95-183, PP Docket No. 93-253, Report and Order, 12 FCC Rcd 18600 (1998).
248 Id.
249 See Letter to Kathleen O'Brien Ham, Chief, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, FCC, from Aida Alvarez, Administrator, SBA (Feb. 4, 1998).
39

Federal Communications Commission

FCC 11-151

("EBS") (previously referred to as the Instructional Television Fixed Service ("ITFS").250
In connection with the 1996 BRS auction, the Commission established a small business
size standard as an entity that had annual average gross revenues of no more than $40
million in the previous three calendar years.251 The BRS auctions resulted in 67
successful bidders obtaining licensing opportunities for 493 Basic Trading Areas
("BTAs"). Of the 67 auction winners, 61 met the definition of a small business. BRS
also includes licensees of stations authorized prior to the auction. At this time, we
estimate that of the 61 small business BRS auction winners, 48 remain small business
licensees. In addition to the 48 small businesses that hold BTA authorizations, there are
approximately 392 incumbent BRS licensees that are considered small entities.252 After
adding the number of small business auction licensees to the number of incumbent
licensees not already counted, we find that there are currently approximately 440 BRS
licensees that are defined as small businesses under either the SBA or the Commission's
rules. In 2009, the Commission conducted Auction 86, the sale of 78 licenses in the BRS
areas.253 The Commission offered three levels of bidding credits: (i) a bidder with
attributed average annual gross revenues that exceed $15 million and do not exceed $40
million for the preceding three years (small business) will receive a 15 percent discount
on its winning bid; (ii) a bidder with attributed average annual gross revenues that exceed
$3 million and do not exceed $15 million for the preceding three years (very small
business) will receive a 25 percent discount on its winning bid; and (iii) a bidder with
attributed average annual gross revenues that do not exceed $3 million for the preceding
three years (entrepreneur) will receive a 35 percent discount on its winning bid.254
Auction 86 concluded in 2009 with the sale of 61 licenses.255 Of the ten winning bidders,
two bidders that claimed small business status won 4 licenses; one bidder that claimed
very small business status won three licenses; and two bidders that claimed entrepreneur
status won six licenses.
94.
In addition, the SBA's Cable Television Distribution Services small
business size standard is applicable to EBS. There are presently 2,032 EBS licensees.


250 Amendment of Parts 21 and 74 of the Commission's Rules with Regard to Filing Procedures in the
Multipoint Distribution Service and in the Instructional Television Fixed Service and Implementation of
Section 309(j) of the Communications Act--Competitive Bidding
, MM Docket No. 94-131, PP Docket No.
93-253, Report and Order, 10 FCC Rcd 9589, 9593 7 (1995).
251 47 C.F.R. 21.961(b)(1).
252 47 U.S.C. 309(j). Hundreds of stations were licensed to incumbent MDS licensees prior to
implementation of Section 309(j) of the Communications Act of 1934, 47 U.S.C. 309(j). For these pre-
auction licenses, the applicable standard is SBA's small business size standard of 1500 or fewer employees.
253 Auction of Broadband Radio Service (BRS) Licenses, Scheduled for October 27, 2009, Notice and
Filing Requirements, Minimum Opening Bids, Upfront Payments, and Other Procedures for Auction 86
,
Public Notice, 24 FCC Rcd 8277 (2009).
254 Id. at 8296.
255 Auction of Broadband Radio Service Licenses Closes, Winning Bidders Announced for Auction 86,
Down Payments Due November 23, 2009, Final Payments Due December 8, 2009, Ten-Day Petition to
Deny Period
, Public Notice, 24 FCC Rcd 13572 (2009).
40

Federal Communications Commission

FCC 11-151

All but 100 of these licenses are held by educational institutions. Educational institutions
are included in this analysis as small entities.256 Thus, we estimate that at least 1,932
licensees are small businesses. Since 2007, Cable Television Distribution Services have
been defined within the broad economic census category of Wired Telecommunications
Carriers; that category is defined as follows: "This industry comprises establishments
primarily engaged in operating and/or providing access to transmission facilities and
infrastructure that they own and/or lease for the transmission of voice, data, text, sound,
and video using wired telecommunications networks. Transmission facilities may be
based on a single technology or a combination of technologies."257 For these services, the
Commission uses the SBA small business size standard for the category "Wireless
Telecommunications Carriers (except satellite)," which is 1,500 or fewer employees.258
To gauge small business prevalence for these cable services we must, however, use the
most current census data. Census data for 2007 shows that there were 1,383 firms that
operated that year.259 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms
had more than 100 employees. Thus under this category and the associated small
business size standard, the majority of firms can be considered small. The Commission
notes that the Census' use the classifications "firms" does not track the number of
"licenses".
95.
In the 1998 and 1999 LMDS auctions,260 the Commission defined a small
business as an entity that has annual average gross revenues of less than $40 million in
the previous three calendar years.261 Moreover, the Commission added an additional
classification for a "very small business," which was defined as an entity that had annual
average gross revenues of less than $15 million in the previous three calendar years.262
These definitions of "small business" and "very small business" in the context of the
LMDS auctions have been approved by the SBA.263 In the first LMDS auction, 104


256 The term "small entity" within SBREFA applies to small organizations (nonprofits) and to small
governmental jurisdictions (cities, counties, towns, townships, villages, school districts, and special districts
with populations of less than 50,000). 5 U.S.C. 601(4)(6). We do not collect annual revenue data on
EBS licensees.
257 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers, (partial
definition), www.census.gov/naics/2007/def/ND517110.HTM#N517110.
258 13 C.F.R. 121.201, NAICS code 517210.
259 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
260 The Commission has held two LMDS auctions: Auction 17 and Auction 23. Auction No. 17, the first
LMDS auction, began on February 18, 1998, and closed on March 25, 1998. (104 bidders won 864
licenses.) Auction No. 23, the LMDS re-auction, began on April 27, 1999, and closed on May 12, 1999.
(40 bidders won 161 licenses.)
261 See LMDS Order, 12 FCC Rcd at 12545.
262 Id.
263 See Letter to Daniel Phythyon, Chief, Wireless Telecommunications Bureau (FCC) from A. Alvarez,
Administrator, SBA (January 6, 1998).
41

Federal Communications Commission

FCC 11-151

bidders won 864 licenses. Of the 104 auction winners, 93 claimed status as small or very
small businesses. In the LMDS re-auction, 40 bidders won 161 licenses. Based on this
information, the Commission believes that the number of small LMDS licenses will
include the 93 winning bidders in the first auction and the 40 winning bidders in the re-
auction, for a total of 133 small entity LMDS providers as defined by the SBA and the
Commission's auction rules.
96.
218-219 MHz Service. The first auction of 218-219 MHz spectrum
resulted in 174 entities winning licenses for 594 Metropolitan Statistical Area ("MSA")
licenses. Of the 594 licenses, 567 were won by 167 entities qualifying as a small
business. For that auction, the small business size standard was an entity that, together
with its affiliates, has no more than a $6 million net worth and, after federal income taxes
(excluding any carry over losses), has no more than $2 million in annual profits each year
for the previous two years.264 In the 218-219 MHz Report and Order and Memorandum
Opinion and Order
, the Commission established a small business size standard for a
"small business" as an entity that, together with its affiliates and persons or entities that
hold interests in such an entity and their affiliates, has average annual gross revenues not
to exceed $15 million for the preceding three years.265 A "very small business" is defined
as an entity that, together with its affiliates and persons or entities that hold interests in
such an entity and its affiliates, has average annual gross revenues not to exceed $3
million for the preceding three years.266 These size standards will be used in future
auctions of 218-219 MHz spectrum.
97.
24 GHz Incumbent Licensees. This analysis may affect incumbent
licensees who were relocated to the 24 GHz band from the 18 GHz band, and applicants
who wish to provide services in the 24 GHz band. For this service, the Commission uses
the SBA small business size standard for the category "Wireless Telecommunications
Carriers (except satellite)," which is 1,500 or fewer employees.267 To gauge small
business prevalence for these cable services we must, however, use the most current
census data. Census data for 2007 shows that there were 1,383 firms that operated that
year.268 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more
than 100 employees. Thus under this category and the associated small business size
standard, the majority of firms can be considered small. The Commission notes that the


264 Implementation of Section 309(j) of the Communications Act Competitive Bidding, PP Docket No.
93-253, Fourth Report and Order, 9 FCC Rcd 2330 (1994).
265 Amendment of Part 95 of the Commission's Rules to Provide Regulatory Flexibility in the 218-219 MHz
Service
, WT Docket No. 98-169, Report and Order and Memorandum Opinion and Order, 15 FCC Rcd
1497 (1999) (" 218-219 MHz Report and Order and Memorandum Opinion and Order").
266 Id.
267 13 C.F.R. 121.201, NAICS code 517210.
268 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
42

Federal Communications Commission

FCC 11-151

Census' use of the classifications "firms" does not track the number of "licenses". The
Commission believes that there are only two licensees in the 24 GHz band that were
relocated from the 18 GHz band, Teligent269 and TRW, Inc. It is our understanding that
Teligent and its related companies have less than 1,500 employees, though this may
change in the future. TRW is not a small entity. Thus, only one incumbent licensee in
the 24 GHz band is a small business entity.
98.
24 GHz Future Licensees. With respect to new applicants in the 24 GHz
band, the small business size standard for "small business" is an entity that, together with
controlling interests and affiliates, has average annual gross revenues for the three
preceding years not in excess of $15 million.270 "Very small business" in the 24 GHz
band is an entity that, together with controlling interests and affiliates, has average gross
revenues not exceeding $3 million for the preceding three years.271 The SBA has
approved these small business size standards.272 These size standards will apply to the
future auction, if held.
99.
Satellite Telecommunications Providers. Two economic census categories
address the satellite industry. The first category has a small business size standard of $15
million or less in average annual receipts, under SBA rules.273 The second has a size
standard of $25 million or less in annual receipts.274
100.
The category of Satellite Telecommunications "comprises establishments
primarily engaged in providing telecommunications services to other establishments in
the telecommunications and broadcasting industries by forwarding and receiving
communications signals via a system of satellites or reselling satellite
telecommunications."275 Census Bureau data for 2007 show that 512 Satellite
Telecommunications firms that operated for that entire year.276 Of this total, 464 firms
had annual receipts of under $10 million, and 18 firms had receipts of $10 million to


269 Teligent acquired the DEMS licenses of FirstMark, the only licensee other than TRW in the 24 GHz
band whose license has been modified to require relocation to the 24 GHz band.
270 Amendments to Parts 1, 2, 87 and 101 of the Commission's Rules to License Fixed Services at 24 GHz,
WT Docket No. 99-327, Report and Order, 15 FCC Rcd 16934, 16967 77 (2000); see also 47 C.F.R.
101.538(a)(2).
271 Id.; see also 47 C.F.R. 101.538(a)(1).
272 See Letter to Margaret W. Wiener, Deputy Chief, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, FCC, from Gary M. Jackson, Assistant Administrator, SBA (July 28, 2000).
273 13 C.F.R. 121.201, NAICS code 517410.
274 13 C.F.R. 121.201, NAICS code 517919.
275 U.S. Census Bureau, 2007 NAICS Definitions, 517410 Satellite Telecommunications.
276 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
43

Federal Communications Commission

FCC 11-151

$24,999,999.277 Consequently, the Commission estimates that the majority of Satellite
Telecommunications firms are small entities that might be affected by our action.
101.
The second category, i.e. "All Other Telecommunications" comprises
"establishments primarily engaged in providing specialized telecommunications services,
such as satellite tracking, communications telemetry, and radar station operation. This
industry also includes establishments primarily engaged in providing satellite terminal
stations and associated facilities connected with one or more terrestrial systems and
capable of transmitting telecommunications to, and receiving telecommunications from,
satellite systems. Establishments providing Internet services or voice over Internet
protocol (VoIP) services via client-supplied telecommunications connections are also
included in this industry."278 For this category, Census Bureau data for 2007 shows that
there were a total of 2,383 firms that operated for the entire year.279 Of this total, 2,347
firms had annual receipts of under $25 million and 12 firms had annual receipts of $25
million to $49, 999,999.280 Consequently, the Commission estimates that the majority of
All Other Telecommunications firms are small entities that might be affected by our
action.
e.

Cable and OVS Operators

102.
Because Section 706 requires us to monitor the deployment of broadband
regardless of technology or transmission media employed, the Commission anticipates
that some broadband service providers may not provide telephone service. Accordingly,
the Commission describes below other types of firms that may provide broadband
services, including cable companies, MDS providers, and utilities, among others.
103.
Cable and Other Program Distributors. Since 2007, these services have
been defined within the broad economic census category of Wired Telecommunications
Carriers; that category is defined as follows: "This industry comprises establishments
primarily engaged in operating and/or providing access to transmission facilities and
infrastructure that they own and/or lease for the transmission of voice, data, text, sound,
and video using wired telecommunications networks. Transmission facilities may be
based on a single technology or a combination of technologies."281 The SBA has
developed a small business size standard for this category, which is: all such firms
having 1,500 or fewer employees. Census data for 2007 shows that there were 1,383


277 See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
278 http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517919&search=2007%20NAICS%20Search.
279 http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
280http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-_skip=900&;-
ds_name=EC0751SSSZ4&-_lang=en.
281 U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired Telecommunications Carriers, (partial
definition), http://www.census.gov/naics/2007/def/ND517110.HTM#N517110 (last visited Oct. 21, 2009).
44

Federal Communications Commission

FCC 11-151

firms that operated that year.282 Of those 1,383, 1,368 had fewer than 100 employees, and
15 firms had more than 100 employees. Thus under this category and the associated
small business size standard, the majority of such firms can be considered small.
104.
Cable Companies and Systems. The Commission has also developed its
own small business size standards, for the purpose of cable rate regulation. Under the
Commission's rules, a "small cable company" is one serving 400,000 or fewer
subscribers, nationwide.283 Industry data indicate that, of 1,076 cable operators
nationwide, all but eleven are small under this size standard.284 In addition, under the
Commission's rules, a "small system" is a cable system serving 15,000 or fewer
subscribers.285 Industry data indicate that, of 6,635 systems nationwide, 5,802 systems
have under 10,000 subscribers, and an additional 302 systems have 10,000-19,999
subscribers.286 Thus, under this second size standard, most cable systems are small.
105.
Cable System Operators. The Communications Act of 1934, as amended,
also contains a size standard for small cable system operators, which is "a cable operator
that, directly or through an affiliate, serves in the aggregate fewer than 1 percent of all
subscribers in the United States and is not affiliated with any entity or entities whose
gross annual revenues in the aggregate exceed $250,000,000."287 The Commission has
determined that an operator serving fewer than 677,000 subscribers shall be deemed a
small operator, if its annual revenues, when combined with the total annual revenues of
all its affiliates, do not exceed $250 million in the aggregate.288 Industry data indicate
that, of 1,076 cable operators nationwide, all but ten are small under this size standard.289


282 U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007 NAICS code 517210 (rel. Oct. 20, 2009),
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&;-
ds_name=EC0751SSSZ5&-_lang=en.
283 47 C.F.R. 76.901(e). The Commission determined that this size standard equates approximately to a
size standard of $100 million or less in annual revenues. Implementation of Sections of the 1992 Cable Act:
Rate Regulation,
Sixth Report and Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393, 7408
(1995).
284 These data are derived from: R.R. BOWKER, BROADCASTING & CABLE YEARBOOK 2006, TOP 25
CABLE/SATELLITE OPERATORS, pages A-8 & C-2 (data current as of June 30, 2005); WARREN
COMMUNICATIONS NEWS, TELEVISION & CABLE FACTBOOK 2006, OWNERSHIP OF CABLE SYSTEMS IN THE
UNITED STATES, pages D-1805 to D-1857.
285 47 C.F.R. 76.901(c).
286 WARREN COMMUNICATIONS NEWS, TELEVISION & CABLE FACTBOOK 2008, U.S. CABLE SYSTEMS BY
SUBSCRIBER SIZE, page F-2 (data current as of Oct. 2007). The data do not include 851 systems for which
classifying data were not available.
287 47 U.S.C. 543(m)(2); see 47 C.F.R. 76.901(f) & nn. 13.
288 47 C.F.R. 76.901(f); see, FCC Announces New Subscriber Count for the Definition of Small Cable
Operator
, Public Notice, 16 FCC Rcd 2225 (Cable Services Bureau 2001).
289 See BROADCASTING & CABLE YEARBOOK 2006, at A-8, C-2 (Harry A. Jessell ed., 2005) (data current as
of June 30, 2005); TELEVISION & CABLE FACTBOOK 2006, at D-805 to D-1857 (Albert Warren ed., 2005).
45

Federal Communications Commission

FCC 11-151

We note that the Commission neither requests nor collects information on whether cable
system operators are affiliated with entities whose gross annual revenues exceed $250
million,290 and therefore we are unable to estimate more accurately the number of cable
system operators that would qualify as small under this size standard.
106.
Open Video Services. Open Video Service (OVS) systems provide
subscription services.291 The open video system ("OVS") framework was established in
1996, and is one of four statutorily recognized options for the provision of video
programming services by local exchange carriers.292 The OVS framework provides
opportunities for the distribution of video programming other than through cable
systems. Because OVS operators provide subscription services,293 OVS falls within the
SBA small business size standard covering cable services, which is "Wired
Telecommunications Carriers."294 The SBA has developed a small business size standard
for this category, which is: all such firms having 1,500 or fewer employees. To gauge
small business prevalence for the OVS service, the Commission relies