Telecom Law Monitor : Washington D.C. Telecom Lawyer & Attorney : Kelley Drye & Warren Law Firm : New York, Chicago, Connecticut, New Jersey, Brussels

Earlier today, the U.S. Department of Justice filed a complaint in U.S. District Court in Washington, D.C. seeking to block the $39B AT&T / T-Mobile merger. DOJ claims that the deal would violate U.S. antitrust law by removing a key competitor while giving AT&T more than a 30% share in the nationwide wireless market and more than a 50% share in many large metropolitan markets. DOJ's press release can be found here.

While certainly a twist in the road, this may not be the end of it for AT&T and T-Mobile. It remains to be seen whether AT&T can sell-off enough assets (likely a tall order, given that the complaint asserts that the relevant geographic market is the entire U.S.) and make enough commitments to settle-out of the complaint and get its deal done in a way that still makes sense for its shareholders.
 

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Interconnected VoIP provider Ooma suffered a three-hour outage late last week.  Ooma identified the cause of the outage as "an extremely rare power failure at a portion of our data center," but the effect of the outage may have a much broader impact.  The outage comes only two weeks after VoIP providers opposed extension of the FCC's outage reporting rules to them.  Timing, as they say, is everything.  In this case, the timing of the outage appears to be unfortunate.

The Ooma outage may assure FCC staff that they are on the right track in requiring reporting of such outages in the future.  Just last week, the Public Safety Bureau announced it was holding a "Workshop/Webinar" on the extension of the reporting requirements to VoIP and broadband providers.  The portion of the workshop devoted to outage reporting is described as examining how public safety agencies and critical infrastructure industries rely on communications "and how outages of interconnected VoIP and broadband Internet service providers could affect their vital work."  It looks like the FCC needs no convincing of the wisdom of requiring new outage reporting by VoIP providers. 

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Last September, the FCC adopted new rules governing gifts received by applicants for disbursements under the FCC's Schools and Libraries program of the Universal Service Fund (known as the "e-rate" program).  Although the FCC clarified its rules once already, application of the new rules is proving to be very difficult.  For the second time, the Universal Service Fund administrator (USAC) is seeking guidance from the FCC regarding how to apply the rules.

The guidance request appears to result from USAC's review of Funding Year 2011 e-rate applications.  Judging from the scope of the questions asked, a large number of e-rate applications may be affected by the guidance request.  In addition, although the FCC clarified that the e-rate gift rules did not apply before January 3, 2011, several requests implicate issues that are raised in pending appeals of prior funding year decisions.  The FCC's decision, therefore, likely will have broad implications for e-rate applications, past and future.

The FCC did not seek comment on the guidance request back in December, and it is not clear whether it will seek public comment in this instance.  Given that funding decisions typically are issued around this time, it is likely the FCC will act quickly on the request.

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As in years, past, we're tracking the FCC Regulatory fees for you.  The Regulatory Fee is an annual assessment mandated by Congress to recover most of the FCC's cost of doing business.  Regulatory fees are recovered directly from the entities the FCC regulates.  As I've noted before, the FCC collects nearly half of its fees from telecommunications carriers, an amount that I believe is disproportionate to the FCC's overall activities.

The due date for regulatory fees varies from year to year, but the FCC must collect regulatory fees before the end of the fiscal year on September 30.  This year, the FCC announced that the fee is due on September 14th by 12 midnight.   As with the past few years, the FCC does not mail invoices and payments are due on-line.  Also, a late fee of 25% of the amount due is assessed on all late payments (no exceptions).

See Kelley Drye's client advisory on the topic for more information.  For those paying regulatory fees, see the links below for more detail on where and how to pay the fees.  As a reminder, our Resource Center contains helpful links to the FCC and other sites of interest to regulated entities.

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As the Commission is proposing to expand its outage reporting rules, the Enforcement Bureau is moving closer to establishing base forfeitures for violations of the outage reporting requirements.  A settlement released on Friday suggests that the Commission has settled on a two-tiered approach to failures to provide outage reports. 

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The Office of Management and Budget does not post the comments it receives on Paperwork Reduction Act notices, like the FCC's recent notices regarding the net neutrality rules.  But we have them here.

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Since 2002, purchasers of special access services from the incumbent local telephone companies have been asking the FCC to revise its pricing rules for the services.   Last month, CompTel (the leading trade association for competitive carriers) and a coalition of others asked the United States Court of Appeals for the DC Circuit to require the FCC to resolve its pending special access proceeding within six months.  The CompTel petition is a petition for mandamus -- a court order compelling action by the agency.  The FCC has not yet responded to the petition. 

This is not the first time competitive carriers have gone to the court for action.  Back in 2003, the old AT&T (pre-acquisition by SBC) asked the same court to compel the FCC to act on AT&T's Petition for Rulemaking filed in 2002 to revise the special access rules.  In reliance on the FCC’s representations that it was diligently working the proceeding, the court required the FCC to file periodic status reports.  The court eventually dismissed the AT&T mandamus petition after the FCC issued the current Notice of Proposed Rulemaking in early 2005.  Six years later, the FCC has not completed that proceeding and CompTel asks the court to require a resolution. 

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The Commission's long-standing refusal to classify VoIP services continues to feed litigation between telecommunications carriers.  Previously, a coalition of carriers asked the courts to decide the issue and it appears likely the FCC will address VoIP at least prospectively, but in the meantime, cases like this will persist.

In the latest case, CLEC Pac-West and IXC Verizon Business sparred in dueling Petitions for Declaratory Ruling stemming from a primary jurisdiction referral by a U.S. District Court in California.  The petitioners offer vastly different approaches to resolving the dispute. 

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