MEMORANDUM

TO: Judy Harkins
Gregg Vanderheiden
RERC on Telecommunications Access
Karen Peltz Strauss
KPS Consulting
Re: Petitions for Reconsideration of Wireless HAC Final Rules " "
In the Matter of Section 68.4 (a) of the Commission's Rules

Governing Hearing Aid-Compatible Telephones, WT Docket No. 01-309

DATE: October 29, 2003

On October 16, 2003, the Cellular Telecommunications & Internet Association (CTIA), Verizon Wireless, a coalition of TDMA Carriers with the Rural Telecommunications Group, and Research in Motion Limited filed Petitions for Reconsideration of the FCC's recently released rules requiring certain wireless telephones to be hearing aid compatible. In addition, on October 22, 2003, AT&T Wireless visited the FCC in an ex parte meeting to express its support for one of the issues raised in the petitions. Each of the petitions is discussed below:

1. CTIA Petition

A. ANSI C63.19 standard. CTIA's petition seeks reconsideration of the ANSI C63.19 standard.

CTIA raises a number of concerns about the FCC's use of the ANSI standard as a technical standard by which hearing aid compatibility must be achieved. To begin with, CTIA states that it is not clear whether this standard:

must now be transformed from a performance measurement standard into a build-to standard. It is also unclear from the HAC Order whether any subsequent development and implementation of a build-to standard must consistently achieve a U3 measurement level, reduce RF emissions, incorporate t-coil coupling and still perform in accordance with the established technical standards for CDMA, TDMA and PCS 1900 digital technologies.

CTIA's main complaint with respect to the standard is that the HAC Order did not offer an explanation for why the ANSI standard is now being used as an "established" technical standard to achieve hearing aid compatibility. Rather than support a finding that this standard is "established," CTIA claims that the Commission's analysis merely supports a finding that the standard is a "work in progress." In support of its argument, CTIA notes that the record in this proceeding contains "substantial evidence" that the standard is not complete "with respect to field testing under multiple conditions and at various signal strengths and obtaining consistent and reliable results." The record contains no data or analysis, according to CTIA, to show that application of the standard could achieve the reduced RF emissions required by the rules, without rigorous testing of the standard on a working wireless system.

CTIA also complains that although the FCC has encouraged industry to pursue alternatives to achieve compatibility, the adoption of a single technical standard has left "little or no incentive" to allow standards groups to consider these alternatives. The Association then goes on to describe the considerable success achieved in Australia and Europe with respect to raising hearing aid immunity levels in the range of 75 V/m-150 V/m, and says that the Commission "failed entirely" to consider as an "equally viable alternative" the range of hearing aid immunity levels manufactured in America. CTIA says the FCC offers no justification for overlooking hearing aid immunity standards as a viable alternative, and complains that the FCC relied on statements made by the Hearing Industry Association, rather than the Food and Drug Administration, with respect to this issue.

CTIA asks the Commission to allow the standards groups. the ATIS Incubator Process and the ANSI C63 Committee. to finish its testing, analysis and revisions of the standard, and only after that time does it say that the FCC should determine whether to adopt the standard as the "established" technical HAC standard. CTIA concludes by asking the FCC to reconsider its decision to adopt the ANSI standard in its current form, and to stay application of its rules pending such reconsideration. CTIA also suggests that the FCC require the standards groups to provide periodic reports on their progress, the estimated time it would take to implement a wireless HAC standard, and other viable alternatives.

B. Implementation Requirements. CTIA seeks reconsideration of the 25% and 50% benchmarks for hearing aid compatibility created by the new rules.

The FCC's new rules require Tier I wireless carriers to provide at least 2 compatible telephones or compatibility in 25% of the telephones that they offer, whichever is greater, within 2 years of the HAC Order (compatibility is defined here as reduced RF interference). CTIA argues first, that the FCC failed to provide any data or rationale for why this requirement only applies to Tier I carriers and second, that the FCC offered "no data, discussion or explanation" for why adoption of this 2 phone/25% model is appropriate. Again, the Association notes that the ANSI standard was "an ongoing process" and that rather than heed the suggestion of commenters to use a technologically neutral solution, the Commission "completely ignored a consumer-driven approach." CTIA complains that the FCC's "boilerplate" language that the 2 phone/25% requirement will promote competition and give consumers a range of wireless options was not "reasoned decisionmaking."

The FCC's rules also require 50% of all digital wireless phones to be compatible (with reduced RF interference) by February 18, 2008. CTIA states that the Commission offered no actual reason or empirical data for why this goal is "feasible or desirable." Because there is "absolutely no discussion of the analysis or decisional factors" used to arrive at this rule, CTIA argues that it, like the 25% rule discussed above, is in violation of the Administrative Procedure Act, an Act which has been interpreted to require agencies to provide explanations for their actions, including "rational connections" between the facts available and the choices made.

C. Labeling Requirements. CTIA argues that the FCC's new requirement to put the U-rating on the exterior packaging of phones will be meaningless for consumers because the consumers will not know what the rating means. Rather, a more "consumer-friendly" labeling requirement, such as a statement that the phone "Meets FCC's Wireless HAC Standard" would be more appropriate. CTIA also agrees that additional information, including the phone's U and UT levels, should be available on carrier, supplier and industry websites, and that more detailed information on the technical standard should be contained in the phone's manual.

D. Reporting Requirements. CTIA complains that the new reporting requirements, which include the disclosure of information about the retail availability of compliant phones, include commercially sensitive data about how carriers and suppliers compete in the marketplace. If required, CTIA says disclosure of this information would have "significant impact" on these industry members. Protections offered by other federal rules under the Freedom of Information Act (FOIA), says CTIA, are inadequate, because they only offer confidentiality protection after the submission of such information. CTIA asks the Commission to clarify how it intends to address this problem before the first 6 month report is due.

E. Live Testing Requirement. CTIA asks the FCC to clarify whether its mandate requiring carriers to allow consumers to test phones in their own retail stores requires all carrier stores to offer live testing. It asks the Commission to clarify its legal authority to apply this to carriers' direct sales outlets but not to other sales agents. It also questions whether the need to "test drive" the phones for compatibility before purchasing a plan is necessary given CTIA's new Voluntary Consumer Information Code (available at www.wow-com.com/pdf/The_Code.pdf.). Because the Code allows for a minimum 14 day trial period and has been adopted by carriers covering 98% of America's population, CTIA says there is already an opportunity to try out phones in a variety of weather, traffic and location conditions before confirming a contract for a particular service.

F. De Minimis Exception - The FCC created an exemption to its new HAC rules for carriers that offer only a small number of wireless telephones in the United States. CTIA states that it is not clear whether this de minimis exemption applies to the total number of phones that a carrier offers, or the number of phones per air interface. If it applies to the former, then CTIA says certain carriers would have to withdraw from certain air interface markets (see discussion of RIM Petition below). CTIA also raises concerns about how the de minimis exception relates to another exemption contained in the HAC Act for new technologies. That exemption allows an entity to apply individually to the FCC for a waiver of HAC requirements with respect to either new telephones or telephones associated with a new technology or service. CTIA asks the Commission to clarify how carriers and supplies should apply the de minimis exception in relation to this new technology exemption. [1]

G. HAC Complaint Procedures. CTIA states that the Commission acted inappropriately when it ruled that consumers could bring complaints against wireless companies under the Part 68 complaint procedures. Those procedures allow consumers to file with either states or the FCC because of the shared jurisdiction of wireline telecommunications. Because wireless telecommunications are not divided by state boundaries, CTIA argues that the FCC cannot regulate these services using a regulatory structure that applies to the wireline industry. CTIA also notes that the Commission has exclusive authority over RF interference, which is regulated in the new HAC rules. Thus, CTIA opposes any state role in the enforcement of these rules.[2]

2. Verizon Wireless Petition

1. Separate Implementation Mandates. Verizon requests deletion of the rule (Section 20.19(c)(3)) that requires Tier I carriers to have greater HAC obligations than other carriers. Instead, Verizon urges the FCC to apply the same HAC mandates to all digital wireless carriers.

Under the FCC's new HAC rules, two mandates are created for the reduction of RF interference within 2 years. The first, which applies to all digital wireless carriers, requires these carriers to make available at least 2 handsets that meet the U3 standard for each air interface they provide. The second requires each Tier I carrier to provide 2 handsets or 25% of the total number of handsets they offer with U3 compatibility, whichever is greater. Verizon states that there is no legal or policy justification for this disparate treatment. It bases this conclusion on the following:

1) The Commission does not justify its decision to create separate mandates on anything contained in the HAC Act.

2) The FCC's wireless HAC Notice of Proposed Rulemaking (NPRM) never proposed a tiering of requirements for different carriers; nor did any party commenting on the NPRM propose this. Accordingly, there was insufficient notice and an opportunity to comment, as required by the Administrative Procedure Act.

3) The FCC's Report and Order offers no explanation, data or analysis for the disparate treatment. No evidence was offered for why being a Tier 1 carrier would be relevant to offering different equipment or capabilities to people with hearing disabilities. The failure to "articulate a satisfactory explanation" was unlawful.

4) The FCC's decision conflicts with 1993 amendments to Section 332 of the Communications Act, which was designed to ensure similar regulatory treatment for similar services. In 1994, Verizon explains, the FCC found that symmetrical regulation for competing wireless carriers would be needed to avoid "potentially distorting effects on the market" (i.e., harm to competition). Verizon says that although there may be situations where separate treatment is warranted, the Commission has not offered specific facts to justify its deviation from Section 332's mandate for consistent treatment.

2. Enforcement. Verizon requests the Commission to delete the rule that allows state commissions to adopt their own enforcement procedures and remedies for the wireless HAC rules.

Verizon maintains that allowing the states to adopt their own HAC enforcement rules violates the goals of the Communications Act and Commission policies for a uniform regulatory framework for wireless services. Verizon offers the following reasons for taking this position:

1) Because the FCC never issued a proposal to give the states this authority, and no party commenting on the HAC NPRM raised this enforcement scheme, its adoption may violate the Administrative Procedure Act.

2) The Order lacks any rationale for allowing states to have an enforcement role. Part 68, upon which the FCC based its decision to give states this authority, is not applicable because it deals with wireline, not wireless services.

3) The 1993 amendments to Section 332 contained a clear objective to put the CMRS industry only under federal oversight, in part because it provides radio services without state boundaries. In addition, the Commission has, in the past, preempted states from adopting rules where they involve setting technical standards like they do here. Finally, where dealing with radio frequency interference, both the Commission and the federal courts have consistently declared the FCC's authority to be exclusive.

4) The FCC also has exclusive jurisdiction over Section 255 complaints. Since the FCC's Section 255 rules also cover hearing aid compatibility, delegating authority for enforcement of the HAC rules to the states could result in conflicting state/federal rulings. The informal complaint process now used by the Commission offers an adequate forum for HAC related complaints on the federal level.

3. TDMA Carriers with the Rural Telecommunications Group ("TDMA and RTG Group" )

The Petition filed by the TDMA and RTG group raises concerns about meeting the HAC obligations for the TDMA protocol. Their Petition explains that approximately thirty months ago, Cingular Wireless and AT&T Wireless made decisions to migrate their networks from the TDMA to a GSM protocol, pulling industry support from the TDMA interface. With this, the development and availability of new TDMA handsets also dramatically declined. Although members of the TDMA and RTG Group are now converting their networks to alternate digital air interfaces, these entities expect that they will have to continue operating in the TDMA protocol even after the effective date of the HAC rules. Accordingly, they seek revision of the rules so they are not burdened with compliance in the TDMA interface at that time.

Specifically, the TDMA and RTG Group claims that new handsets and enhancements to existing handset models may not be developed or available for the TDMA air interface to enable them to comply with the HAC rules. They say that a requirement that only applies to TDMA carriers, without a parallel requirement for the availability of conforming HAC handsets will make it impossible for them to comply with the HAC rules. The only option for TDMA carriers if this occurs would be to stop operating the TDMA air interface, and force affected phones to return to the analog mode. Accordingly, the TDMA and RTG Group asks the FCC to tie the HAC carrier obligations to the actual availability of HAC handsets. So long as the compliant handsets are available, they will be sold. If they are not available, they say the TDMA carriers should not be held liable.

As one alternative, the TDMA and RTG Group proposes that where a TDMA carrier is operating a digital protocol in addition to the TDMA network being phased out and the carrier makes available handsets for the new technology, the carrier should be relieved of its obligation to offer TDMA HAC handsets.

As a second alternative, the TDMA and RTG Group asks the FCC to consider the situation where a TDMA carrier that is transitioning to another interface stops offering any TDMA handsets to new subscribers. Because by the time the rules come out, there will be only a limited number of TDMA phones that are commercially available, it asks for the de minimis exemption to be applied on a "per air interface" basis. More specifically, where a carrier offers only a limited number of (noncompliant) TDMA handsets, but offers HAC handsets for another air interface, they say that the de minimis exemption should apply with respect to the TDMA air interface for that carrier.

The Petition goes on to explain the problems that TDMA carriers have had meeting FCC deadlines in the E911 context, because rules for the sale of automatic location identifying handsets have not been tied to the availability of these handsets for the TDMA interface. The consequence has been a "flood of waiver requests based on the unavailability of such handsets." The TDMA and RTG Group is trying to avoid this with respect to the HAC rules.

4. Research in Motion Limited (RIM)

The new FCC HAC rules create a de minimis exemption for manufacturers that offer 2 or fewer digital handsets in the United States. RIM states that it has learned from Commission staff that this exemption considers all handsets offered by manufacturers across all interfaces. This interpretation, RIM claims, will disadvantage certain manufacturers. RIM offers its own example: it offers only one BlackBerry Wireless Handheld for each of the iDEN and CDMA air interfaces, but 7 models for the GSM/GPRS interface. If the de minimis exemption is interpreted to consider all 9 devices at once, RIM would have to provide at least 2 HAC handsets each for the CDMA and iDEN protocols (RIM understands and accepts that it would need to provide 2 HAC devices for the GSM protocol). The requirement to actually increase the number of BlackBerry models " " from 1 to 3 for the CDM and iDEN interfaces, and to 15 in total. RIM says, would create a large burden. In addition, RIM states that the Order does not consider introduction of a new interface, such as UMTS. Because the interpretation would seem to require all handset suppliers to enter the market with either 2 HAC models or none at all, it would limit competition and stifle technological progress. As a solution, RIM proposes that the Commission clarify the de minimis exemption to apply on an air interface basis.

5. AT&T Wireless. In an ex parte letter dated October 22, 2003, AT&T Wireless revealed that it had expressed its support for the requested clarification of the de minimis exception as proposed by RIM. This occurred support during a meeting held with staff of the FCC's Disabilities Rights Office on October 21, 2003.

This summary was prepared as part of the RERC on Telecommunications Access, a joint project of Gallaudet University and the Trace Center, University of Wisconsin-Madison under funding from the National Institute on Disability and Rehabilitation Research (NIDRR) of the US Dept of Education Grant H133E990006. The opinions offered herein are those of the author and do not necessarily represent those of the RERC on Telecommunications Access, the Universities or funding agencies.

[1] To the best of my knowledge, the individual waiver exemption for specific technologies has been invoked only once, with respect to the landline volume control requirement as it applied to potentially explosive telephones.

[2] CTIA suggests that the FCC's current complaint processes, administered by its Consumer and Governmental Affairs Bureau (CGB) is adequate, and notes that it has had "several productive meetings and an on-going dialogue" with CGB on how the process for informal complaints can be improved. It also indicates that it has asked CGB "to provide the wireless industry with the number of disability-related informal complaints and inquiries even if such complaints do not constitute the top five categories of complaints and inquiries."

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