Federal Communications Commission

1. TC 310 May 14, 2008 Federal Communications Commission

2. Structure • 5 Commissioners, including 1 Chairperson • Only 3 of the same party at any given time • Bureaus • Handle specific areas, hold hearings, etc. • Enforcement • Wireless • Media • Wireline Competition

3. Pre-FCC • Early Telephone Networks • Mostly unregulated • Bell has patents, develops monopoly • Patents expire, competition emerges, redundant • All players want some regulation • Bell: avoid cream skimming • Independents: Make Bell interconnect • States: Reduce inefficient competition

4. ICC Regulation • Interstate Commerce Commission • Mann-Elkins Act, 1910 • Telecos are common carriers • Limits of Act • No tariff filing requirements • No telecom forced interconnection • ICC Ineffectively regulates Telecom • Cares more about railroads • Allows rates to be set by carriers • No national plan

5. ICC Successes • Kingsbury Commitment (1913)‏ • DoJ and ICC • Letter from VP Kingsbury to Attorney General • Divest Western Union • No new acquisitions without ICC approval • Interconnect to Long Distance • Not local or to other long distance • Shreveport Rate Case (1914 SC decision)‏ • Smith v. Illinois Bell Telephone Co. (1930)‏

6. 1934 Communications Act • Federal counterweight to Bell • Distinctions between Federal and State • Improve availability, quality, of radio and telephony in the U.S. • Creates FCC to specifically deal with communication technology, no more ICC jurisdiction

7. FCC Jurisdiction/Authority • 1934 limits them to interstate only • Reversal of Shreveport and Smith • Gives authority over all things necessary for communication • Flexible for new technologies

8. State Authority • 45 States have some form of regulatory commission • 98% of calls are intrastate • 1934 Act leaves authority to states to deal with rates, infrastructure, etc, for anything that is intrastate

9. How to separate? • Networks do not follow geographic boundaries • Equipment arbitrarily separated. • Facilities also separated. • Depreciation problematic • Accounting problematic

10. 1996 Act • Federalization of local issues • Get rid of barriers to entry, including states • Require unbundling, interconnection at LEC • Who has authority to do this then? • States argue FCC has specific local authority • Portability, numbering, unbundling • FCC sees Act as authorization from Congress to make national rules. • 8th Circuit rules with states; Supreme Court overturns

11. Preemption • North Carolina Utilities Commission v FCC • (1976)‏ • CPE is at issue, NCUC not allowing connetion to network; FCC preempts • Court upholds FCC power to do so • Services is inseperable intra v. inter • Inter greatly affected by intra (Smith again?)‏ • Power of Preemption grows

12. Limit of Preemption • Louisiana Public Service Commission v. FCC • (1986)‏ • FCC pushing new depreciation/accounting rules • Over turned by Supreme Court • When it is possible to separate costs, separate jurisdictions make sense, different rates can apply. • 1996 Act grants FCC greater power, ability to preempt in order to protect competition. States still have authority, but must be neutral.

13. Back Door Power • 1996 Act gives FCC power to regulate States • FCC substitution (Section 252(e)(5))‏ • What constitutes State failure? • Complaint Process(Section 208)‏ • Bypass States and Courts • Entry into interLATA by LECs (Section 271(c)(2))‏ • Commission has to approve after completion of checklist • Does this include pricing?

14. FCC and Common Carriers • Common Carriers regulated by Title II • Interconnection; active, now passive • Tariffs- must be filed with FCC • Attempted forbearance; 1996 forbearance granted • Why tariffing problematic? • Just and Reasonable Rates/ No Discrimination • Facility Building • Competition • Interconnection rates

15. Oversight of Industry • In addition to industry wide, FCC can • Regulate internal management by owners, CEOs, shareholders. Must all be reported • Set depreciation rates. Still battled between States/Feds • Mergers • License transfer. Good for public interest?

16. Procedures • Complaints • FCC first, then Court of Appeals • Enforcement • FCC first, can also go to federal courts • FCC has power to enforce Act using Courts • Private Actions • Harmed by violation can file action for damages to FCC. Applies to Act violations only.

17. Forbearance • Unique power to FCC • Authority not to regulate, uphold Communications Act requirements • Earlier attempts disputed by Courts, 1996 Grants • Some limitations • General findings period, public interest supported • Interconnection required, interLATA BOC entry

18. Triggers for Policy • Triggers • Mandatory • Congress Command • Judicial Order • Optional • Suggestion from Exec, or Leg. • Sua sponte • Private Party • Vetted through public comments process

19. Creation Process • Notice of Inquiry (NOI)‏ • General position, what to do • Kills with Memorandum Opinion and Order (MO&O)‏ • Notice of Proposed Rule Making (NPRM)‏ • Report and Order (N&O)‏ • Goes to Federal Register • 30 days a Petition for Reconsideration • Opposition and Replies to Oppositions • Order on Reconsideration or MO&O