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}*h88,[XhxU7X>;xxxXjڔx H@B @H<!,Dm,< PE37,Pz-b81,b&_ x7X8wC;,D=9Xw PE37XPV"G($,DhG PE37hPD7zC;,MBXz_ pi7X6uC;,~Xu&_ x7XXs-_5/,D_ PE37P8wC;,D=9Xw PE37XPy.X80,IX\  P6G;Pt,X5.,\|X4  pG;7nC:,Xn4  pG;X\I4!,-",4*f9 xr G;,X7t GI "ר*KL  29{ X' y yO'#C\  P6QIP#` `  Federal Communications Commission  *xxXFCC 99229  yO' yxdddy#XP\  P6Q+XP#US??#C\  P6QIP#??US  X4#XP\  P6Q+XP#  X4#XP\  P6Q+XP#US?? U 1 1!xxddbM X4X` hp x (#%'0*,.8135@8:'#C\  P6QIP#э See, e.g., TIA Comments at 45; AMTA Comments at 34. AMTA states that PMRS operators should not be classified as telecommunications carriers under CALEA because they do not provide interconnected service and do not have access to the PSTN, which AMTA contends is the traditional focus of law enforcement.  that the determination of whether a particular mobile service offering is private or common carrier depends on the nature of the service and to whom it is offered. Although private and common carrier services are by definition" 90*U$U$X"  X4mutually exclusive,2:X`y yOy'#X\  P6G;IP#Ѝ [T]he term private mobile service means any mobile service . . . that is not a commercial mobile service or the functional equivalent of a commercial mobile service . . . . 47 U.S.C.  332(d)(3). 2 a given carrier may offer both. Where a PMRS operator uses its facilities to offer interconnected service for profit to the public, or a substantial portion of the  X4public, that service qualifies as CMRS,;`y {O'#X\  P6G;IP#э#X\  P6G;IP# See Regulatory Treatment of Mobile Services, Second Report and Order, 9 FCC Rcd 1411, 142829 (1994). and thus is subject to CALEA.  X424. Resellers. After evaluating a record that is somewhat divided on this subject,c<z`y {O '#X\  P6G;IP#э Several commenters argue that resellers are telecommunications carriers for the purposes of CALEA. See,  {O 'e.g., Airtouch Reply Comments at 1516; Ameritech Comments at 2; Bell South Comments at 56, Reply Comments at 45; FBI Comments at  26; GTE Comments at 4; Omnipoint Comments at 78; PageNet Comments at 6; PCIA Comments at 6; SBC Comments at 67; USTA Comments at 4. GTE and SBC suggest that purchasers of Unbundled Network Elements (UNEs) should also be subject to all of CALEAs requirements.  {O 'GTE Comments at 5; SBC Comments at 7. See also USTA Comments at 4. Motorola, on the other hand, argues for exclusion of resellers on the basis that they are not facilitiesbased providers. Motorola Comments at 5. c we conclude that resellers, as telecommunications carriers under the terms of section 102, are  Xv4generally subject to CALEA.=v  yO'#C\  P6QIP#э We also note that the Commission has already ruled that resellers are common carriers for the purposes of the  {O_'Communications Act. See also PCIA Comments at 78; BellSouth Reply Comments at 5; both citing Regulatory Policies Concerning Resale and Shared Use of Common Carrier Services and Facilities, 60 FCC 2d 261, 308 (1976).  We note, however, that resellers may own some facilities, such as electronic switching equipment, and frequently operate hybrid networks consisting of both their own facilities and resold services from other facilitiesbased carriers. We agree with TIA and PCIA that resellers' responsibility under CALEA should be limited to their own  X 4facilities.>Z r`y {Ou'#C\  P6QIP#э TIA Reply Comments at 12; PCIA Comments at 8. See also SBC Comments at 67; GTE Comments at 45; PageNet Comments at 56. Resellers will therefore not be held responsible for the CALEA compliance responsibilities of the carrier whose services they are reselling with respect to the latter's underlying facilities. Further, because their offerings are limited to essentially private networks, most PBX providers and many aggregators would fall outside the scope of  X 4CALEA.m? `y {Os '#C\  P6QIP#э See SBC Comments at 8. m " ^?0*U$U$ "Ԍ X425. Pay Telephone Providers. We will exclude pay telephone providers from the definition of telecommunications carrier. As discussed above, the CALEA legislative history states that [t]he only entities required to comply with the functional requirements are telecommunications common carriers, the components of the public switched network where  X4law enforcement agencies have always served most of their surveillance orders.@`y {O'#C\  P6QIP#э H.R. Rep. No. 103827(I), at 21 (1994), reprinted in 1994 U.S.C.C.A.N. 3489, 3498. #XP\  P6Q+XP# Moreover, we find that pay telephone providers do not have the information and the means to effectuate lawful electronic surveillance, which is maintained by the carriers who provide switched telephone services to pay telephone providers. We also note that no commenters oppose our tentative conclusion that pay telephone providers are not telecommunications carriers for the  X14purposes of CALEA.A1"`y {O< '#C\  P6QIP#э See GTE Comments at 3; FBI Comments at  23; SBC Comments at 9.  X 426. Information Services and Calling Features. Commenters unanimously agree with  X 4our tentative conclusion that providers that exclusively offer information services (IS) (i.e., that do not also offer telecommunications services), such as electronic mail providers and online service providers, are exempt from CALEA's requirements. There is sharp disagreement, however, on the status of common carriers who also provide information services. The FBI states that any portion of a telecommunications service provided by a common carrier that is  X{4used to provide transport access to information is subject to CALEA's requirements.iB{`y yO'#X\  P6G;IP#э FBI Comments at  29. i On the other hand, many other commenters argue that CALEA's IS exemption is not based on the carrier offering the services, but on the nature of the services . . . , and thus extends to  X64all IS providers.CZ6D`y {Oc'#X\  P6G;IP#Ѝ ACLU Comments at 11. See also AT&T Comments at 3940; CDC Comments at 2122; Metricom Reply Comments at 12; PCIA Reply Comments at 14. Omnipoint maintains that [CALEA's] text and structure excludes information services from the category of services covered by CALEA in two ways. First, section 102(8)(c) defines the term telecommunications carrier to exclude persons or entities  X4insofar as they are engaged in providing information services. Second, section 103 contains a subsection entitled limitations that expressly states that CALEA's capabilities requirements  X4do not apply to . . . information services.D`y yOL '#X\  P6G;IP#э Omnipoint Reply Comments at 67 (emphasis added by Omnipoint). ". D0*U$U$5"Ԍ27. Where facilities are used solely to provide an information service, whether offered by an exclusivelyIS provider or by a common carrier that has established a dedicated IS system apart from its telecommunications system, we find that such facilities are not subject to CALEA. Where facilities are used to provide both telecommunications and information services, however, such jointuse facilities are subject to CALEA in order to ensure the ability  X4to surveil the telecommunications services.aED`y yO'#X\  P6G;IP#э We do not credit Powertel's apparent suggestion that cellular carriers that provide service using GSM technology are information services providers and should be excluded from CALEA's requirements. Powertel Comments at 23. CALEA, like the Communications Act, is technology neutral. Thus, a carrier's choice of  {O^ 'technology when offering common carrier services does not change its obligations under CALEA. See, e.g., Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of  {O 'the Telecommunications Act of 1996, Report, FCC 98146, at  9 and 23 (rel. Feb. 1, 1999). a For example, digital subscriber line (DSL) services are generally offered as tariffed telecommunications services, and therefore subject to CALEA, even though the DSL offering often would be used in the provision of information services. On the other hand, where an entity used its own wireless or satellite facilities to distribute an information service only, the mere use of transmission facilities would not make  X 4the offering subject to CALEA as a telecommunications service.F `y {O'#X\  P6G;IP#э See the Commission's Report to Congress on the Commission's implementation of certain provisions of the Telecommunications Act of 1996 regarding the universal service system, in which the Commission summarized its view of the relationship between telecommunications and information services: [T]he categories of telecommunications service and information service in the 1996 Act are mutually exclusive. Under this interpretation, an entity offering a simple, transparent transmission path, without the capability of providing enhanced functionality, offers telecommunications. By contrast, when an entity offers transmission incorporating the capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information, it does not offer telecommunications. Rather, it offers an information service  {O'even though it uses telecommunications to do so. FederalState Joint Board on Universal Service, Report to  {O'Congress, CC Docket No. 9645, 13 FCC Rcd 11501, 11520 (1998) (Stevens Report).  28. There was little comment on our observation that CALEA covers entities that provide calling features such as call forwarding (and the corresponding voice mail feature, call  X 4redirection), call waiting, threeway (i.e., conference) calling, and speed dialing. These features are considered to be so closely related to basic service that we treat them as adjuncts  X4to it.Gr`y {O'#X\  P6G;IP#э See North American Telecommunications Assn, 101 FCC 2d 349 (1985), recon. denied, 3 FCC Rcd 4385 (1988). They are also like traditional pen registers and traps and traces in that they relate to the setup or routing of telecommunications, rather than its content. Moreover, the legislative"{G0*U$U$""  X4history of CALEA explicitly states that they are covered services.H`y {Oy'#X\  P6G;IP#э H.R. Rep. No. 103827(I), at 23, 26 (1994), reprinted in 1994 U.S.C.C.A.N. 3489, 3500, 3503 Accordingly, these specific calling features will be considered covered by CALEA, whether offered over wireline or wireless facilities.  X429. Other Issues. We do not believe it necessary at this time either to identify by rule additional classes of entities within CALEA's definition of telecommunications carrier, pursuant to section 102(8)(B)(ii), or to exempt in our rules any classes pursuant to section 102(8)(C)(ii). Moreover, we agree with the FBI that codification in our rules of a list of  XH4examples would run the risk of being considered definitive rather than merely illustrative.IH"`y yOS '#X\  P6G;IP#э A few commenters support the Commission's proposal to include in its rules an illustrative list of classes of telecommunications carriers subject to CALEA. The FBI expresses concern that any type of illustrative list could be considered allinclusive, but suggests that if a list is adopted, several additional telecommunications services should be included. FBI Comments at  24.  We therefore have decided not to adopt such a list, as we had proposed in the NPRM.  X ' B. Section 109: Requests for Relief Under the Reasonably Achievable  X '44 Standard  X 430. Background. Section 109(b)(1) of CALEA provides that a telecommunications carrier or any other interested person may petition the Commission for a determination regarding whether compliance with the assistance capability requirements of section 103 of CALEA is reasonably achievable with respect to any equipment, facility, or service installed  XK4or deployed after January 1, 1995.X01ÍÍX01ÍÍJK `y yO>'#C\  P6QIP#Í 47 U.S.C.  1008(b)(1). Section 109(a) of CALEA provides that the Attorney General, subject to the availability of appropriations, may agree to pay telecommunications carriers for all reasonable costs directly associated with modifications performed to comply with section 103 in connection with equipment, facilities, and services installed or deployed on or before January 1, 1995. 47 U.S.C.  1008(a). Under section 109(d), if a carrier requests payment in accordance with procedures promulgated pursuant to section 109(e) of CALEA, and the Attorney General does not agree to pay the carrier for the reasonable costs associated with CALEA compliance for equipment, facilities or services eligible for reimbursement because deployed on or before January 1, 1995, then such equipment, facilities or services shall be considered to be in compliance with the assistance capability requirements of section 103 until the equipment, facility, or service is replaced or significantly upgraded or otherwise undergoes major modification. 47 U.S.C.  1008(d)(e).  The Commission must make such a determination, after notice is given to the Attorney General, within one year after the date on which a petition is"4J0*U$U$"  X4filed.kK`y yOy'#C\  P6QIP#э 47 U.S.C.  1008(b)(1). k Under section 109(b)(2), if the Commission determines that compliance with the assistance capability requirements of section 103 is not reasonably achievable with respect to any equipment, facility, or service installed or deployed after January 1, 1995, the affected carrier may request the Attorney General to pay for the additional reasonable costs of making  X4compliance reasonably achievable.nL `y yO'#C\  P6QIP#э 47 U.S.C.  1008(b)(2)(A). n If the Attorney General declines to pay such costs, the  X4affected carrier will be deemed to be in compliance with the requirements of section 103.nM`y yO& '#X\  P6G;IP#э 47 U.S.C.  1008(b)(2)(B). n 31. In making determinations as to reasonable achievability under section 109(b) of CALEA, the Commission must determine whether compliance would impose significant difficulty or expense on the carrier or on the users of the carrier's system and must also consider the following factors:  X 444A.44The effect on public safety and national security;(#4  X 4X,44B.44The effect on rates for basic residential telephone service;(#4  X 4X,44,` ` 44C.44The need to protect the privacy and security of communications not authorized to be intercepted;(#`  X4X,44,` ` 44D.44The need to achieve the capability assistance requirements of section 103 by costeffective methods;(#`  Xb4X,44E.44The effect on the nature and cost of the equipment, facility, or service at issue;(#4  XK4X,44F.44The effect on the operation of the equipment, facility, or service at issue;(#4  X44X,44G.44The policy of the United States to encourage the provision of new technologies and services to the public;(#4  X4X,44H.44The financial resources of the telecommunications carrier;(#4  X4X,44I.44The effect on competition in the provision of telecommunications services;(#4  X4X,44,` ` 44J.44The extent to which the design and development of the equipment, facility, or service was initiated before January 1, 1995;(#`  X4X,44K.44#Xj\  P6G;+XP#Such other factors as the Commission determines are appropriate.rN@`y yO'#C\  P6QIP#э 47 U.S.C.  1008(b)(1)(A)(K). r(#4 32. In the NPRM, we requested comment on these factors and the extent to which the Commission should consider specific factors when determining whether or not compliance"eN0*U$U$"  X4with CALEA's assistance capability requirements is reasonably achievable.aO`y yOy'#C\  P6QIP#э NPRM at  48. a Because section 109(b)(1)(K) allows the Commission to consider such other factors as the Commission  X4determines are appropriate,nP `y yO'#C\  P6QIP#э 47 U.S.C.  1008(b)(1)(K). n we also requested comment on what additional factors the  X4Commission should consider in making such determinations, and why.aQ`y yOT'#C\  P6QIP#э NPRM at  48. a We asked commenters to state how such additional factors would be consistent with the intent of CALEA, and how those factors should be balanced against the explicit criteria contained in  Xv4CALEA section 109(b)(1).ZRv@`y {O '#C\  P6QIP#э Id. Z  XH433. Comments. Commenters express widely divergent views regarding how the Commission should evaluate reasonable achievability petitions under section 109(b) of CALEA and the relative weight the Commission should give to each of the factors set forth in that section. While a number of commenters advocate a balanced approach that would give  X 4equal weight to all the factors in section 109(b)(1),SZ `y {O'#C\  P6QIP#э See, e.g., BellSouth Comments at 17; AT&T Comments at 8, Reply Comments at 45; Ameritech Reply Comments at 1213; Nextel Reply Comments at 67; PrimeCo Reply Comments at 7.  others argue that certain factors should be accorded special significance. The FBI, for example, urges the Commission to give paramount consideration to the effect of compliance on public safety and national  X 4security,MT" , `y {O'#C\  P6QIP#э FBI Comments at  96. A number of commenters voice opposition to this suggestion. See AirTouch Reply Comments at 1314; CDT Reply Comments at 45; Nextel Reply Comments at 67; PrimeCo Reply Comments at 7; AT&T Reply Comments at 5. M while certain industry commenters stress the importance of technical and economic" N T0*U$U$ "  X4factorsUx`y yOy'#C\  P6QIP#э Motorola, for example, urges the Commission to assign the greatest weight to factors such as the need to achieve the capability assistance requirements of CALEA by costeffective methods; the effect of compliance on the nature and cost of equipment, facilities, and services; and the effect of compliance on the operation of equipment, facilities, and services. Motorola Comments at 10. TIA, citing the language of section 109(b), contends that the Commission should give significant weight to those factors that may add to the difficulty or expense imposed on the carrier or users of the network. TIA Comments at 8.  or factors that have an impact on consumers.Vx`y yO'#C\  P6QIP#э USTA identifies these factors as the effect of compliance on rates for basic residential telephone service; the need to protect the privacy and security of communications not authorized to be intercepted; the effect of compliance on the nature and cost of the equipment, facility, or service at issue; the effect of compliance on the operation of the equipment, facility, or service at issue; the financial resources of the telecommunications carrier; and the effect of compliance on competition in the provision of telecommunications services. USTA Comments at 12.  Other commenters emphasize that the  X4Commission should protect privacy interests.W `y yOR'#C\  P6QIP#э While stating that Congress intended the Commission to balance all of the section 109(b) factors, CDT urges the Commission to protect the telecommunications privacy interests of the American public. CDT Comments  {O'at 47, Reply Comments at 45. See also ACLU Comments at 2, 12; AT&T Comments at 13; CTIA Comments at 15.  34. A number of commenters suggest additional factors for the Commission to consider when making a reasonable achievability determination. Several commenting parties urge us to include the lack of section 103 standards and commercially available CALEAcompliant hardware or software, and of section 104 capacity requirements, as preliminary  X_4factors that would demonstrate that compliance is not reasonably achievable.X _j`y {O'#C\  P6QIP#э See, e.g., AT&T Comments at 6, Reply Comments at 24, 810; BellSouth Comments at 17; PCIA Comments at 56; PrimeCo Comments at 4; SBC Comments at 2627; USCC Comments at 3; U.S. West Comments at 40 {OD'43, Reply Comments at 2123; GTE Reply Comments at 45; TIA Reply Comments at 19. See also CTIA Comments at 12; PageNet Comments at 1113. Section 104 of CALEA requires that telecommunications carriers comply with capacity requirements established by the Attorney General after consultation with state and local law enforcement agencies, telecommunications carriers, providers of telecommunications support services, and manufacturers of telecommunications equipment. 47 U.S.C.  1003. Capacity concerns the question of how many simultaneous law enforcement intercepts carriers must be prepared to accommodate.  BellSouth recommends that the Commission consider the FBI's failure to issue its final capacity requirements and the likelihood of some uncertainty resulting from nonindustry opposition  X 4to the . . . interim trial standard JSTD025 as two additional section 109 factors.YZF v`y yOy!'#C\  P6QIP#э BellSouth Comments at 1718. In March 1998, after the comment cycle for this proceeding had closed, the FBI issued, pursuant to notice and comment rulemaking procedures, a final notice of capacity requirements.  {O #'Implementation of Section 104 of the Communications Assistance for Law Enforcement Act, Final Notice of" #X0*U$U$#"  {O'Capacity, 63 Fed. Reg. 12218 (DoJ/FBI, March 12, 1998). See also Initial Notice of Capacity, 60 Fed. Reg. 53643 (DoJ/FBI, October 16, 1995), and Second Notice of Capacity, 62 Fed. Reg. 1902 (DoJ/FBI, January 14, 1997). The purpose of the capacity notice, which would take effect three years after date of publication, was to specify the capacity that carriers must install, subject to government reimbursement. A lawsuit has been filed in federal district court alleging that the FBI's March 1998 capacity notice does not satisfy the requirements of  {Oz'CALEA. Cellular Telecommunications Industry Assoc. v. Reno, Civil Actions 1:98CV01036, 1:98CV02010  {OD'(D.D.C. filed Apr. 27, 1998) (CTIA v. Reno).  " Y0*U$U$ " BellSouth also argues that the impact of CALEA compliance on all telecommunications  X4services, not just basic residential service, should be deemed an additional factor.jZ`y yO '#C\  P6QIP#э BellSouth Comments at 18. j SBC proposes not only that the reasonable availability of technology and the implementation cost per affected switch should be given the status of additional factors, but also that those factors  X4should be given primary weight in reasonable achievability determinations.[f `y yO '#C\  P6QIP#э SBC Comments at 27. OPASTCO also suggests that the Commission establish an additional factor stating that the compliance of equipment, facilities, and services installed or deployed since January 1, 1995, but prior to manufacturers' commercial release of CALEA solutions, is not reasonably achievable. OPASTCO Comments at 4.  TIA suggests that the Commission should consider whether a cost incurred by a U.S. carrier to comply with CALEA is similar to that imposed by foreign governments for law enforcement assistance, and whether an unchallenged industry standard or agreement between the FBI and manufacturers"identifying an agreedupon set of CALEAcompliant features"exists for  X14a certain telecommunications product.{\1N `y yOh'#C\  P6QIP#э TIA Comments at 89, Reply Comments at 19. { Arguing that all carriers should receive cost recovery for CALEArelated expenses, TCG contends that a carrier's ability to obtain rate  X 4recovery should be an additional factor for the Commission to consider.d] `y yO'#C\  P6QIP#э TCG Comments at 10. d USTA suggests that we treat as an additional factor under section 109(K) whether achieving compliance would be unreasonable for a smaller carrier because of the disproportionate economic impact  X 4on the carrier.h^ n`y yO'#X\  P6G;IP#э USTA Comments at 1213. h Without proposing specific factors, AT&T interprets subsection K to mean that the enumerated section 109 factors are not exclusive, and that individualized" ^0*U$U$ " determinations based on unique carrier circumstances are required in making reasonable  X4achievability determinations.I_`y {Ob'#C\  P6QIP#э AT&T Comments at 20. See also CTIA Comments at 22. Discussing extensions of time under section 107(c), CTIA states that the Commission should look to the section 109(b) factors as the basic criteria for granting such extensions and that the Commission should consider in addition whether or not an intercept could be performed elsewhere (presumably more economically) and the good faith and diligence of the carrier in working to achieve CALEA compliance. CTIA Comments at 89. I 35. Motorola asks the Commission explicitly to provide that telecommunications equipment manufacturers are interested part[ies] for the purposes of filing reasonable  X4achievability petitions under section 109 of CALEA.h`B`y yO '#X\  P6G;IP#э Motorola Comments at 9. h TIA makes a similar request on  Xv4behalf of manufacturers and their trade associations.cav`y yO1'#X\  P6G;IP#э TIA Comments at 8. c In addition, certain commenters argue that the filing of a section 109 petition should toll the CALEA compliance deadline  XH4automatically until the Commission acts on the petition.bZHb `y {O'#X\  P6G;IP#э AT&T Comments at 2122; CTIA Comments at 23; US West Reply Comments at 23. But see FBI Reply Comments at  27 (opposing tolling).  X 436.  Conclusions. Before we examine the individual factors of section 109(b) and commenters' specific ideas and proposals regarding these factors, we make certain general observations. First, we note that under the provisions of CALEA the telecommunications industry plays a key role in development of the technological and related standards necessary for compliance with the statute. As the House Report explains, CALEA allows industry associations and standardsetting bodies, in consultation with law enforcement, to establish publicly available specifications creating safe harbors for carriers. This means that those whose competitive future depends on innovation will have a key role in interpreting the legislated requirements and finding ways to meet them without impeding the deployment of  XK4new services.cK `y {O'#X\  P6G;IP#э H.R. Rep. No. 103827(I), at 22 (1994), reprinted in 1994 U.S.C.C.A.N. 3489, 3499. In light of industry's significant role in developing the assistance capability standards of CALEA, we stress that section 109 is to be reserved for the examination of specific carrier compliance problems, and is not to be used as a vehicle for rearguing the standards that have been established for compliance with section 103. "N c0*U$U$"Ԍ37. As a preliminary matter, we also recognize that we may receive some petitions for  X4extensions of time to comply with CALEA under section 107(c) of the Act.fd( `y yOb'#X\  P6G;IP#э 47 U.S.C.  1006(c). We note, for example, that law enforcement is currently conducting discussions with industry regarding a flexible CALEA deployment schedule that involves setting priorities for making switches CALEAcompliant. The Department of Justice has submitted a letter to the Commission describing these negotiations and indicating that the Department might agree to support petitions submitted to the Commission pursuant to section 107(c) by certain carriers seeking an extension of the CALEA compliance date for deployments to service areas that are not high priorities for law enforcement. Letter from Stephen R. Colgate, Assistant Attorney General for Administration, to William E. Kennard, Chairman, Federal Communications Commission, dated June 30, 1999. We agree with the Department that these discussions could be a useful means of ensuring that those facilities most important to law enforcement are CALEAcompliant in the near term, while also reducing costs for carriers. Accordingly, if these discussions result in agreements between law enforcement and industry on switch prioritization, we intend to give them significant weight in deciding whether to grant extensions of time under section 107(c) for bringing facilities into compliance with CALEA. f Under section 107(c), the Commission may grant an extension of the CALEA compliance deadline "if the Commission determines that compliance with the assistance capability requirements under section 103 is not reasonably achievable through application of technology available within  X4the compliance period."ke `y yO.'#X\  P6G;IP#э 47 U.S.C.  1006(c)(2). k To the extent we find it appropriate to grant extensions of time under section 107(c), it may be necessary to provide relief under section 109 only in unusual cases. 38. Turning to the question of how we should apply the individual factors set forth in section 109, and whether we should consider additional factors, we note that the factors of section 109(b) reflect the broad goals that Congress identified in enacting CALEA generally. As the House Report states, CALEA seeks to balance three key policies: (1) to preserve a narrowly focused capability for law enforcement agencies to carry out properly authorized intercepts; (2) to protect privacy in the face of increasingly powerful and personally revealing technologies; and (3) to avoid impeding the development of new communications services and  X4technologies.fZH `y {O'#X\  P6G;IP#э H.R. Rep. No. 103827(I), at 13, reprinted in 1994 U.S.C.C.A.N. 3489, 3493; see also 140 Cong. Rec. 10771, 10781 (Oct. 4, 1994) (comments by Rep. Markey).  In light of the overall purpose of CALEA to preserve law enforcement's ability to conduct courtauthorized surveillance, we find that we must in all cases consider public safety, and, where applicable, national security, in our analysis of section 109 petitions. At the same time, given the importance Congress has placed on the privacy and security of  X44communications that are not the targets of courtordered surveillance,g4`y {O"'#X\  P6G;IP#э See, e.g., H.R. Rep. No. 103827(I), at 30, reprinted in 1994 U.S.C.C.A.N. 3489, 3507. and the need to"44g0*U$U$"  X4ensure that the development of new technologies and services is not impeded,h`y {Oy'#X\  P6G;IP##X\  P6G;IP#э See, e.g., id. at 22, reprinted in 1994 U.S.C.C.A.N. 3489, 3499. we also find that those factors involving privacy and innovation are likely to be important in many cases. However, the technological diversity of carrier networks, as well as other carrier characteristics, will, as a matter of course, mean that certain factors will be more important to the arguments of certain carriers than others, and not all of the factors enumerated in section 109 may be relevant to the analysis of a given reasonable achievability petition. We therefore find that it would be premature at this point to assign special weight to any one factor generally or to adopt additional factors. 39. A central concern to many commenters is the issue of how the Commission will approach the cost of CALEA compliance when evaluating section 109 petitions. The FBI suggests that we require that individual carriers include in their petitions an estimate of the reasonable costs directly associated with modifications under consideration and, further, that, in cases where we find that a modification is not reasonably achievable, we determine what  X 4specific portion of the costs is reasonably achievable for the carrier.ki$ "`y {O'#X\  P6G;IP#э See FBI Comments at  9495. For comments opposing this request, see AT&T Reply Comments at 67;  {O'CTIA Reply Comments at 1517; Primeco Reply Comments at 67; and TIA Reply Comments at 1819. But see  SBC Reply Comments at 10. k Other costrelated comments include CTIA's suggestion that we determine what a reasonable charge is for  X4CALEAcompliant productsejF`y yO'#X\  P6G;IP#э CTIA Comments at 16. e and USTA's recommendation that we perform a cost benefit  Xy4analysis under section 109.hky`y yO8'#X\  P6G;IP#э USTA Comments at 1113. h We find, as a general principle, that, in making judgments under section 109, we will look only to the additional cost incurred in making equipment and facilities CALEA compliant. We anticipate that, in many instances, carriers will become CALEA compliant in the course of general network upgrades and will recover any additional  X4cost of CALEA compliance through their normal charges.lxf `y yOl'#X\  P6G;IP#э If, in particular, law enforcement and industry reach agreements regarding switch prioritization that enable us to grant extensions of time under section 107(c) allowing carriers to make certain equipment CALEA compliant as part of the normal upgrade cycle with resulting low compliance costs, we would expect such compliance generally to be reasonably achievable. On the other hand, there may be cases in which law enforcement opposes any extension of time for making particular equipment CALEA compliant, resulting in substantial additional costs to a carrier. In those cases, we could find compliance not to be reasonably achievable.  We also would expect, however, that CALEA solutions that would require a carrier to change vendors in order to purchase"l0*U$U$" costly new switching equipment, or to replace costly existing facilities, would generally not be  X4deemed reasonably achievable under section 109.rm`y {Ob'#X\  P6G;IP#э See AT&T Comments at 1415. r We stress, however, that any petitioner who argues that it is unable to comply with CALEA for reasons of cost must present quantitative cost information that is as detailed, accurate and complete as possible, which we shall analyze along with any technological problems related to the nature of the equipment, facility, or service at issue. Large carriers with multiple switch types in networks that cover large or diverse areas may present data on a per switch basis, in order to identify compliance problems specific to particular segments of the carrier's network. 40. In order to distinguish the additional costs of CALEA compliance from the costs of general network upgrades, we offer the following guidance to carriers in identifying the cost of CALEA compliance. In our view, costs are related to CALEA compliance only if carriers can show that these costs would not have been incurred by the carrier but for the implementation of CALEA. For instance, costs incurred as an incidental consequence of CALEA compliance are not directly related to CALEA compliance and should be excluded from the carrier's showing. Finally, general overhead costs cannot be allocated to CALEA compliance, only additional overheads incremental to and resulting from CALEA  Xy4compliance.ny"`y {O'#X\  P6G;IP#э Cf. Telephone Number Portability, Third Report and Order, CC Docket No. 95116, 13 FCC Rcd 11701,   {ON'7275; Telephone Number Portability Cost Classification Proceeding, Memorandum Opinion and Order, CC Docket No. 95116, 13 FCC Rcd 24495,  6, 10 (1998) (principles used for identifying costs incurred by incumbent LECs directly related to the implementation of telephone number portability).  41. We agree as a general matter with those commenters that argue that carrier size  X44and geographic location may be significant considerations under section 109."oZ4`y {O+'#X\  P6G;IP#э With respect to carrier size, see USTA Comments at 1213. With respect to geographic location, see AT&T  yO'Comments at 10; CTIA Comments at 14; USCC Comments at 4. " However, if law enforcement and the telecommunications industry agree on a flexible CALEA deployment schedule that results in an extension of the current compliance deadline for equipment and facilities in areas that are not high priorities for law enforcement, we do not expect many small rural carriers to need relief under section 109. 42. Further, we believe that in implementing section 109 we should seek to minimize any adverse effects of CALEA compliance on quality of service and subscriber rates. This approach is consistent with the Congressional mandate to the Commission in section 109(b)(1)"|h o0*U$U$" to determine whether compliance would impose significant difficulty or expense on the  X4carrier or the users of the carrier's systems . . . .p`y {Ob'#X\  P6G;IP#э#X\  P6G;IP# 47 U.S.C.  1008(b)(1). See also AT&T Comments at 1112; CTIA Comments at 1415.#Xj\  P6G;+XP# Moreover, the same section specifically directs the Commission to consider the effect of compliance on rates for basic residential telephone service, reflecting a special Congressional concern about rate impacts for that  X4service.qC`y {O'#X\  P6G;IP#э 47 U.S.C.  1008(b)(1)(B). See H.R. Rep. No. 103827(I), at 4950, reprinted in 1994 U.S.C.C.A.N. 3489, 3515 (statement of Rep. Edwards and Rep. Boucher). We also note that under section 107(b) one of the factors that the Commission is to consider in establishing technical requirements or standards is minimizing the cost of compliance on residential ratepayers. 47 U.S.C.  1006(b)(3).  However, we find that the arguments in this record that CALEA compliance will  X4increase rates,r-`y {O '#X\  P6G;IP#э See AT&T Comments at 1113; CTIA Comments at 1415. affect quality of service,s`y {O5'#X\  P6G;IP#э See AT&T Comments at 15; CTIA Comments at 17. make particular technologies and services  Xv4unprofitable,tvQ `y {O'#C\  P6QIP#э See AT&T Comments at 1617; CTIA Comments at 17. prevent the introduction of services to the market,uv `y {OB'#C\  P6QIP#э See AT&T Comments at 17; CTIA Comments at 1819. or price services out of  X_4the reach of certain groups of customers,ov_u `y {O'#X\  P6G;IP#э See AT&T Comments at 17. o are at this point inherently speculative. Any such arguments made in individual petitions under section 109 will be given substantial weight only to the extent they are made with particularity and are grounded on specific quantitative data. 43. The Commission may consider the financial resources of individual telecommunications carriers under section 109(b)(1)(H), and industrywide competitive  X 4pressures under section 109(b)(1)(I), in its evaluations of section 109 petitions.w `y {O'#X\  P6G;IP#э 47 U.S.C.  1008(b)(1)(H)(I); see also CTIA Comments at 1920. AT&T and  X 4CTIA express concern regarding the expense of CALEA for wireless carriers in particular.x `y yO)'#C\  P6QIP#э AT&T Comments at 1719; CTIA Comments at 1921. We stress again that requests for relief based on such factors must be supported by carrier or industryspecific facts, including quantitative data. We find, contrary to AT&T's assertion,"y)x0*U$U$" that special consideration for a new market entrant would not necessarily be tantamount to an  X4unfair subsidy.oy`y {Ob'#X\  P6G;IP#э See AT&T Comments at 17. o 44. A number of commenters have argued forcefully that the delay in establishing assistance capability standards and capacity requirements is an important factor for the Commission to consider in making reasonable achievability determinations. On September 11, 1998, the Commission issued a Memorandum Opinion and Order granting industry a 20month blanket extension of the CALEA compliance deadline until June 30, 2000, under  XH4Section 107 of the statute.qzH"`y {OS '#X\  P6G;IP#э Extension Order at  1. q In our November 5, 1998 Further NPRM, we stated that we would consider granting an additional extension for compliance by telecommunications  X 4carriers with any additional technical requirements the Commission eventually approves.{{ `y {O'#X\  P6G;IP#э Standards Further Notice at  47. { The Third Report and Order, adopted contemporaneously with this Order, extends until September 30, 2001, the deadline for additional technical requirements for wireline, cellular  X 4and PCS providers.z| F`y yO'#X\  P6G;IP#э Third Report and Order, at  129. Because the Third Report and Order applies only to wireline, cellular, and PCS providers, that Order does not cover other providers that must be CALEAcompliant by June 30, 2000. However, all providers that meet the definition of telecommunications carrier must meet this deadline. It is our understanding that industry associations are currently developing safe harbor provisions for at least some of those providers, which will be proposed for adoption in advance of the compliance date. z In light of these circumstances, we find that any petitioner who seeks relief under section 109 on the basis of the delay in the adoption of assistance capability standards must present carrier or equipmentspecific facts demonstrating that such delay actually has made CALEA compliance infeasible. As for any alleged lack of CALEAcompliant software and hardware on the market, we will take such claims into consideration in evaluating section 109 petitions, but only if raised with sufficient specificity and supported with a particularized showing. We decline to adopt AT&T's proposal that we place a specific burden on law enforcement to demonstrate that equipment or facilities have been used for criminal activity in cases where reasonable achievability petitions are filed before CALEA X4compliant hardware or software is available.p} `y {O'#X\  P6G;IP#э See AT&T Comments at 89. p With respect to the FBI's delay in issuing capacity requirements, we note that requirements for wireline, cellular, and broadband PCS were issued on March 12, 1998"more than 27 months in advance of the revised June 30," }0*U$U${"  X42000 CALEA compliance deadline.~$`y {Oy' xM #X\  P6G;IP#э See supra notes 8889. See also Implementation of Section 104 of the Communications Assistance to Law  x Enforcement Act: Telecommunications Services Other than Local Exchange Services, Cellular, and Broadband PCS,  {O 'Notice of Inquiry, 63 Fed. Reg. 70,160 (1998).  Accordingly, there has been ample time for industry to evaluate these requirements, and we do not expect to grant section 109 petitions on the basis of the timing of their issuance. 45. Pursuant to section 109(b)(J), we will consider the extent to which the design and development of equipment was initiated before January 1, 1995, to the extent appropriate in  Xv4our examination of section 109 petitions.nv`y yO '#X\  P6G;IP#э 47 U.S.C.  1008(b)(1)(J). n In commenting on section 109(b)(1)(J), certain parties argue as well that the definition of installed or deployed adopted by the FBI as part of its cost recovery rules is excessively narrow in restricting its application to equipment, facilities, and services operable and available for use by a carriers customers by January 1,  X 41995.  D`y {OG'#X\  P6G;IP#э AT&T Comments at 1920; CTIA Comments at 2122. See also OPASTCO Comments at 45 and SBC  {O'Comments at 2728. But see FBI Reply Comments at  27 n. 39 (opposing commenters' attempt to revisit the definition). The FBI's final cost recovery rules are set forth at 28 C.F.R.  100.9100.21. The FBI's definition in its rules of installed or deployed is found at 28 C.F.R.  100.10.  Under section 109(e) of the Act, the Attorney General is vested with the responsibility for establishing cost control regulations governing the Federal Government's payment of costs associated with bringing equipment installed or deployed on or before January 1, 1995, into compliance with CALEA. The Commission is assigned only a  X 4consultatory role with respect to such cost control regulations.f 0 `y yO'#X\  P6G;IP#э 47 U.S.C. 1008(e)(2). f We therefore find that it is  X 4not within the Commission's authority to adopt rules defining installed or deployed.| `y {OP'#X\  P6G;IP#э We note that the definition of "installed or deployed" is a central issue in CTIA v. Reno, a pending lawsuit initiated by CTIA, PCIA, and TIA to challenge the FBI's capacity requirements and final cost recovery rules.  {O'See supra note 89. USTA has also joined the suit. The court has stayed this litigation a number of times, without objection from any party to the lawsuit, in order to allow for negotiations between the FBI and industry regarding a flexible CALEA deployment schedule, which is discussed above at note 100. The most recent stay was issued on July 29, 1999, for 60 days.  46. We recognize the status of equipment manufacturers and their associations as interested parties to this proceeding, and therefore will allow them to file section 109 petitions. We decline to toll the CALEA compliance deadline automatically upon the filing of"K<0*U$U$*" a section 109 petition. Such tolling would be tantamount to an automatic extension of the deadline, which may not be appropriate in all cases.  X'T IV. PROCEDURAL MATTERS \ 47. This action is taken pursuant to Sections 1, 2, 4(i), 201(a), 229, 301, 303 and 332(c) of the Communications Act of 1934, 47 U.S.C.  151, 152, 154(i), 201(a), 229, 301, 303, 332(c)(1)(B).  X '%6 V. ORDERING CLAUSES \ 48. Accordingly, IT IS ORDERED that the Regulatory Flexibility Analysis, as required by Section 604 of the Regulatory Flexibility Act and as set forth in Appendix B, is adopted. 49. IT IS FURTHER ORDERED that the Commission's Office of Public Affairs, Reference Operations Division, SHALL SEND a copy of this SECOND REPORT AND ORDER, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration. 44` `   hhCqFEDERAL COMMUNICATIONS COMMISSION 44` `   hhCqMagalie Roman Salas 44` `   hhCqSecretary "|0*U$U$,"     @A-@  X'u  APPENDIX A " List of Commenters \  X' Comments: AirTouch Communications, Inc. (AirTouch) American Civil Liberties Union; Electronic Privacy Information Center; and Electronic Frontier Foundation (ACLU) American Mobile Telecommunications Association, Inc. (AMTA) Ameritech Operating Companies (Ameritech) AT&T Corp. (AT&T) Bell Atlantic Mobile, Inc. (Bell Atlantic) BellSouth Corporation (BellSouth) Cellular Telecommunications Industry Association (CTIA) Center for Democracy and Technology; Electronic Frontier Foundation; and Computer Professionals for Social Responsibility (CDT) GlobeCast North America Incorporated (GlobeCast) GTE Service Corporation (GTE) Metricom, Inc. (Metricom) Motorola, Inc. (Motorola) National Telephone Cooperative Association (NTCA) Nextel Communications, Inc. (Nextel) Omnipoint Communications, Inc. (Omnipoint) Organization for the Promotion and Advancement of Small Telecommunications Companies (OPASTCO) Paging Network, Inc. (PageNet) Personal Communications Industry Association (PCIA) Powertel, Inc. (Powertel) PrimeCo Personal Communications, L.P. (PrimeCo) Rural Telecommunications Group (RTG) SBC Communications Inc. (SBC) Southern Communications Services, Inc. (Southern) Sprint Spectrum L.P. (Sprint) Telecommunications Industry Association (TIA) Teleport Communications Group Inc. (TCG) 360- Communications Company (360) United States Cellular Corporation (USCC) United States Telephone Association (USTA) U.S. Department of Justice, Federal Bureau of Investigation (FBI)"#0*>%>%!"ԌU S WEST, Inc. (US West)  X' Reply Comments: AirTouch Communications, Inc. American Civil Liberties Union; Electronic Privacy Information Center; Electronic Frontier Foundation; and Computer Professionals for Social Responsibility Ameritech Operating Companies AT&T Corp. BellSouth Corporation Cellular Telecommunications Industry Association Center for Democracy and Technology; Computer Professionals for Social Responsibility GTE Service Corporation ICO Services Limited Metricom, Inc. Mobex Communications, Inc. Motorola, Inc. Nextel Communications, Inc. Omnipoint Communications, Inc. Personal Communications Industry Association PrimeCo Personal Communications, L.P. SBC Communications Inc. Southern Communications Services, Inc. Telecommunications Industry Association Teleport Communications Group Inc. United States Telephone Association U S WEST, Inc. U.S. Department of Justice, Federal Bureau of Investigation  X7' Informal Comments: Connecticut State Police Illinois State Police Indiana State Police New Jersey Department of Law and Public Safety Office of the Hudson County (New Jersey) Prosecutor Ocean County (New Jersey) Prosecutor City of New York Police Department"#0*>%>%!"ԌChattanooga (Tennessee) Police Department East Ridge (Tennessee) Police Department Hamilton County (Tennessee) District Attorney Texas Department of Public Safety U.S. Department of Justice, Drug Enforcement Administration U.S. Department of the Treasury, U.S. Customs Service U.S. Postal Service, Office of the Inspector General National Technical Investigators' Association "H 0*>%>%"  X'  4` hp x (#%` hp x (#% 'jZ   @A-B-@yymC yO'#X\  P6G;IP#` `  Federal Communications Commission  *xxXFCC 99229 yxdddy  X4#Xj\  P6G;+XP#  X' APPENDIX B " Final Regulatory Flexibility Analysis \  X4X01ÍÍX01ÍÍ1.` hp x (#%  As required by the Regulatory Flexibility Act (RFA),u" {O'#X\  P6G;IP#э See 5 U.S.C.  603. The RFA, 5 U.S.C.  601 et seq., has been amended by the Contract with America Advancement Act, Pub. L.No. 104121, 110 Stat. 847 (1996)(CWAAA). Title II of the CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA). u an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice of Proposed Rulemaking in this  Xv4proceeding.Zv {O '#X\  P6G;IP#э Communications Assistance for Law Enforcement Act, Notice of Proposed Rulemaking, CC Docket No. 97213, 13 FCC Rcd 3149, 318494 (1997) (NPRM). The Commission sought written public comment on the proposals in the NPRM, including the IRFA. This Final Regulatory Flexibility Analysis (FRFA) conforms to the  XH4RFA.mH  {O='#X\  P6G;IP#э See 5 U.S.C.  604. m  X ' (a)XNeed for and Purpose of this Action (#  X 4 2. In this Second Report and Order, the Commission, in compliance with 47 U.S.C.  X 4 229,d  yOE'#X\  P6G;IP#э 47 U.S.C.  229. d promulgates policies implementing the Communications Assistance for Law  X 4Enforcement Act.X .  yO'#X\  P6G;IP#э #X\  P6G;IP#Pub. L. No. 103414, 108 Stat. 4279 (1994) (codified as amended in sections of 18 U.S.C. and 47 U.S.C.) (CALEA or the Act). In enacting CALEA, Congress sought to make clear a telecommunications carrier's duty to cooperate in the interception of communications for law  Xy4enforcement purposes . . . .qy  {O'#X\  P6G;IP#э CALEA, supra, at preamble. q This Second Report and Order addresses in particular certain issues relevant to sections 102 and 109 of CALEA: (1) the definition of telecommunications carrier set forth in section 102, which determines which entities and services are subject to the assistance capability and other requirements of CALEA; and (2) the factors the Commission will consider in making determinations under section 109 of the Act as to whether compliance with CALEA is reasonably achievable for particular carriers. "!0*>%>%"Ԍ X4 3. The policies adopted in this Second Report and Order implement Congress's goal of ensuring that telecommunications carriers support the lawful electronic surveillance needs of law enforcement agencies as telecommunications technologies evolve. These policies promote the three key policies Congress sought to balance in enacting CALEA: (1) to preserve a narrowly focused capability for law enforcement agencies to carry out properly authorized intercepts; (2) to protect privacy in the face of increasingly powerful and personally revealing technologies; and (3) to avoid impeding the development of new  X_4communications services and technologies._ {O'#X\  P6G;IP#э H.R. Rep. 103827(I), at 16 (1994), reprinted in 1994 U.S.C.C.A.N. 3489, 3493.  X ' (b)XSummary of the Issues Raised by Public Comments Made in Response to the  X 'IRFA (# 4. In the NPRM, the Commission asked for comments that specifically addressed  X 4issues raised in the IRFA.h " yO'#X\  P6G;IP#э NPRM at  5476. h The IRFA focused on proposed reporting, recordkeeping and other compliance requirements relating primarily to sections 105 and 107 of CALEA. These matters lie outside the immediate scope of this Second Report and Order, which is limited to clarifying what entities, services, and facilities are subject to CALEA (pursuant to section 102) and examining the factors the Commission will consider when determining if compliance with CALEA's assistance capability requirements is reasonably achievable (pursuant to section 109). Only one party, BellSouth Corporation, filed comments directly responding to the IRFA, but its comments on the IRFA relate to the Commission's proposed system security  X4and integrity regulations. These issues were dealt with in an earlier order rather than in this  X4Second Report and Order, and BellSouth's comments were addressed therein.D \ {O'#X\  P6G;IP#э Communications Assistance for Law Enforcement Act, Report and Order, CC Docket 97213, FCC 9911 (rel.  {OT'Mar. 15, 1999), recon. sua sponte, Order on Reconsideration, FCC 99184 (rel. Aug. 2, 1999). D Many parties, however, submitted comments on the Commission's proposals affecting small businesses set forth in the NPRM. These included requests that we exempt certain categories of telecommunications carriers from the assistance capability requirements, based on their limited operations or the burden of implementing the facility changes necessary to meet the"" 0*>%>%"  X4requirements,  {Oy'#X\  P6G;IP#э See, e.g., AMTA Comments at 48; Nextel Comments at 67. and that in considering whether compliance is reasonably achievable, we  X4attach special significance to the economic impact on smaller carrier[s].y " {O'#X\  P6G;IP#э See, e.g., USTA Comments at 1213. y We summarize our action on these comments below.  X' (c)X Description and Estimate of the Number of Small Entities to Which the   Xv'Actions Taken May Apply: (# 5. The RFA directs agencies to provide a description of and, where feasible, an  X14estimate of the number of small entities that may be affected by the action taken.i 1 yO '#X\  P6G;IP#э 5 U.S.C.  603(b)(3). i The RFA generally defines the term small entity as having the same meaning as the terms small  X 4business, small organization, and small governmental jurisdiction.i  D {O0'#X\  P6G;IP#э Id.  601(6). i In addition, the term small businesshas the same meaning as the term mall business concernunder the Small  X 4  Business Act.o  yO'#X\  P6G;IP#э 5 U.S.C.  601(3) (incorporating by reference the definition of small business concern in 15 U.S.C.  632). Pursuant to the RFA, 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). o A small business concern is one that: (1) is independently owned and  H operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria  X 4established by the Small Business Administration (SBA).x  yO'#X\  P6G;IP#э Small Business Act, 15 U.S.C.  632. x A small organization is generally any notforprofit enterprise which is independently owned and operated and is not dominant  Xy4in its field.fy yOx'#X\  P6G;IP#э 5 U.S.C.  601(4). f Nationwide, as of 1992, there were approximately 275,801 small  Xb4organizations.Xb yO '#X\  P6G;IP#э 1992 Economic Census, Bureau of the Census, U.S. Dept. of Commerce, Table 6 (special tabulation of data under contract to Office of Advocacy of the U.S. Small Business Administration).  And finally, small governmental jurisdiction generally means governments of cities, counties, towns, townships, villages, school districts, or special districts, with a"K#0*>%>%"  X4population of less than 50,000.fD3 yOy'#X\  P6G;IP#э 5 U.S.C.  601(5). f As of 1992, there were approximately 85,006 such  X4jurisdictions in the United States. D3 {O'#X\  P6G;IP#э 1992 Census of Governments, Bureau of the Census, U.S. Dept. of Commerce. This number includes 38,978 counties, cities, and towns;  X4of these, 37,566, or 96 percent, have populations of fewer than 50,000.ZD3 {Om'#X\  P6G;IP#э Id. Z The United States Bureau of the Census (Census Bureau) estimates that this ratio is approximately accurate for all governmental entities. Thus, of the 85,006 governmental entities, we estimate that 81,600 (91 percent) are small entities. Below, we further describe and estimate the number of small business concerns that may be affected by the actions taken in this Second Report and Order. 6. As noted, under the Small Business Act, a small business concern is one that: (1) is independently owned and operated; (2) is not dominant in its field of operation; and (3)  X 4meets any additional criteria established by the SBA.Z DD3 {OG'#X\  P6G;IP#э 15 U.S.C.  632. See, e.g., Brown Transport Truckload, Inc. v. Southern Wipers, Inc., 176 B.R. 82 (N.D.Ga. 1994). The SBA has defined a small business for Standard Industrial Classification (SIC) categories 4812 (Radiotelephone Communications) and 4813 (Telephone Communications, Except Radiotelephone) to be small entities when they  X 4have no more than 1,500 employees.h D3 yO\'#X\  P6G;IP#э 13 C.F.R.  121.201. h We first discuss the number of small telecommunications entities falling within these SIC categories, then attempt to refine further those estimates to correspond with the categories of telecommunications companies that are commonly used under our rules.  Xb47. Total Number of Telecommunications Entities Affected.  The Census Bureau reports that, at the end of 1992, there were 3,497 firms engaged in providing telephone services, as  X64defined therein, for at least one year.2Z6. D3 {OM'#X\  P6G;IP#э 1992 Census of Transportation, Communications, and Utilities: Establishment and Firm Size, Bureau of the  yO'Census, U.S. Dept. of Commerce, at Firm Size1-123 (1995) (1992 Census). 2 This number contains a variety of different categories of entities, including local exchange carriers, interexchange carriers, competitive access providers, cellular carriers, mobile service carriers, operator service providers, pay telephone operators, PCS providers, covered SMR providers, and resellers. It seems certain that some of those 3,497 telephone service firms may not qualify as small entities or small incumbent  X4LECs because they are not independently owned and operated.j D3 yO4$'#X\  P6G;IP#э 15 U.S.C.  632(a)(1). j For example, a PCS"$+&&" provider that is affiliated with an interexchange carrier having more than 1,500 employees would not meet the definition of a small business. It seems reasonable to conclude, therefore, that fewer than 3,497 telephone service firms are small entity telephone service firms or small incumbent LECs that may be affected by the actions taken in this Second Report and Order. 8. The most reliable source of current information regarding the total numbers of common carrier and related providers nationwide, including the numbers of commercial  X_4wireless entities, appears to be data the Commission publishes annually in its Carrier Locator report, derived from filings made in connection with the Telecommunications Relay Service  X34(TRS).Z3D3 {O '#X\  P6G;IP#э Carrier Locator: Interstate Service Providers, Fig. 1 (Jan. 1999) (Carrier Locator). See also 47 C.F.R.  64.601.608. According to data in the most recent report, there are 3,604 interstate carriers.q3D3 {O '#X\  P6G;IP#э Carrier Locator at Fig. 1. q  X 4These include, inter alia, local exchange carriers, wireline carriers and service providers, interexchange carriers, competitive access providers, operator service providers, pay telephone operators, providers of telephone toll service, providers of telephone exchange service, and resellers. 9. We have included small incumbent local exchange carriers (LECs) in this RFA  X4analysis. As noted above, a small business under the RFA is one that, inter alia, meets the  X4pertinent small business size standard (e.g., a telephone communications business having  Xj41,500 or fewer employees), and is not dominant in its field of operation.fj|D3 yO'#X\  P6G;IP#э 5 U.S.C.  601(3). f The SBA's Office of Advocacy contends that, for RFA purposes, small incumbent LECs are not dominant  X<4in their field of operation because any such dominance is not national in scope.< D3 yO1'#X\  P6G;IP#э Letter from Jere W. Glover, Chief Counsel for Advocacy, SBA, to William E. Kennard, Chairman, FCC (May 27, 1999). The Small Business Act contains a definition of small business concern, which the RFA  {O'incorporates into its own definition of small business. See 15 U.S.C.  632(a) (Small Business Act); 5 U.S.C.  601(3) (RFA). SBA regulations interpret small business concern to include the concept of dominance on a national basis. 13 C.F.R.  121.102(b). Since 1996, out of an abundance of caution, the Commission has  {O'included small incumbent LECs in its regulatory flexibility analyses. Implementation of the Local Competition  {O'Provisions of the Telecommunications Act of 1996, CC Docket, 9698, First Report and Order, 11 FCC Rcd 15499, 16144-45 (1996).  We have therefore included small incumbent LECs in this RFA analysis, although we emphasize that this RFA action has no effect on FCC analyses and determinations in other, nonRFA contexts. "%+&&-"Ԍ X410. Wireline Carriers and Service Providers (SIC 4813). The Census Bureau reports that there were 2,321 telephone communications companies other than radiotelephone  X4companies in operation for at least one year at the end of 1992.~D3 {OM'#X\  P6G;IP#э 1992 Census, supra, at Firm Size1-123. ~ All but 26 of the 2,321 nonradiotelephone companies listed by the Census Bureau were reported to have fewer than 1,000 employees. Thus, even if all 26 of those companies had more than 1,500 employees, there would still be 2,295 nonradiotelephone companies that might qualify as small entities or small incumbent LECs. Although it seems certain that some of these carriers are not independently owned and operated, we are unable at this time to estimate with greater precision the number of wireline carriers and service providers that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 2,295 small entity telephone communications companies other than radiotelephone companies that may be affected by the actions taken in this Second Report and Order.  X 411. Local Exchange Carriers, Interexchange Carriers, Competitive Access Providers,  X 4and Resellers. Neither the Commission nor SBA has developed a definition of small LECs, interexchange carriers (IXCs), competitive access providers (CAPs), or resellers. The closest applicable definition for these carriertypes under SBA rules is for telephone communications  X4companies other than radiotelephone (wireless) companies.w"D3 yO'#X\  P6G;IP#э 13 C.F.R.  121.210, SIC Code 4813. w The most reliable source of information regarding the number of these carriers nationwide of which we are aware appears  XQ4to be the data that we collect annually in connection with the TRS.QD3 {O'#X\  P6G;IP#э See 47 C.F.R.  64.601 et seq.; Carrier Locator at Fig. 1. According to our most  X:4recent data, there are 1,410 LECs, 151 IXCs, 129 CAPs, and 351 resellers.4 Z:DD3 {Og'#X\  P6G;IP#э Carrier Locator at Fig. 1. The total for resellers includes both toll resellers and local resellers. The TRS category for CAPs also includes competitive local exchange carriers (CLECs) (total of 129 for both). 4 Although it seems certain that some of these carriers are not independently owned and operated, or have more than 1,500 employees, we are unable at this time to estimate with greater precision the number of these carriers that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 1,410 small entity LECs or small incumbent LECs, 151 IXCs, 129 CAPs, and 351 resellers that may be affected by the actions taken in this Second Report and Order.  X412. Wireless Carriers (SIC 4812). The Census Bureau reports that there were 1,176 radiotelephone (wireless) companies in operation for at least one year at the end of 1992, of  XV4which 1,164 had fewer than 1,000 employees.~!VD3 {O$'#X\  P6G;IP#э 1992 Census, supra, at Firm Size1-123. ~ Even if all of the remaining 12 companies"V&0 !+&&" had more than 1,500 employees, there would still be 1,164 radiotelephone companies that might qualify as small entities if they are independently owned are operated. Although it seems certain that some of these carriers are not independently owned and operated, we are unable at this time to estimate with greater precision the number of radiotelephone carriers and service providers that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 1,164 small entity radiotelephone companies that may be affected by the actions taken in this Second Report and Order.   XH413. Cellular, PCS, SMR and Other Mobile Service Providers. In an effort to further refine our calculation of the number of radiotelephone companies that may be affected by the actions taken in this Second Report and Order, we consider the data that we collect annually in connection with the TRS for the subcategories Wireless Telephony (which includes PCS, Cellular, and SMR) and Other Mobile Service Providers. Neither the Commission nor the SBA has developed a definition of small entities specifically applicable to these broad subcategories, so we will utilize the closest applicable definition under SBA rules, which is  X 4for radiotelephone communications companies."Z D3 {O"'#X\  P6G;IP#э Id. To the extent that the Commission has adopted definitions for small entities in connection with the auction of particular wireless licenses, we discuss those definitions below.  According to our most recent TRS data, 732 companies reported that they are engaged in the provision of Wireless Telephony services and  X{423 companies reported that they are engaged in the provision of Other Mobile Services.q#{D3 {ON'#X\  P6G;IP#э Carrier Locator at Fig. 1. q Although it seems certain that some of these carriers are not independently owned and operated, or have more than 1,500 employees, we are unable at this time to estimate with greater precision the number of Wireless Telephony Providers and Other Mobile Service Providers, except as described below, that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 732 small entity Wireless Telephony Providers and fewer than 23 small entity Other Mobile Service Providers that might be affected by the actions taken in this Second Report and Order.  X414. Broadband PCS Licensees. The broadband PCS spectrum is divided into six frequency blocks designated A through F, and the Commission has held auctions for each block. The Commission defined small business for Blocks C and F as an entity that has  Xi4average gross revenues of not more than $40 million in the three previous calendar years.m$i|D3 yO '#X\  P6G;IP#э 47 C.F.R.  24.720(b)(1). m These regulations defining small business in the context of broadband PCS auctions have  X;4been approved by SBA.%Z; D3 {O0$'#X\  P6G;IP#э Implementation of Section 309(j) of the Communications Act"Competitive Bidding, PP Docket No. 93253, Fifth Report and Order, 9 FCC Rcd 5532, 558184 (1994).  No small businesses within the SBAapproved definition bid";'f %+&&8" successfully for licenses in Blocks A and B. There have been 237 winning bidders that qualified as small entities in the four auctions that have been held for licenses in Blocks C, D, E and F, all of which may be affected by the actions taken in this Second Report and Order.  X415. SMR Licensees.  The Commission has defined small business in auctions for geographic area SMR licenses as a firm that had average annual gross revenues of not more than $15 million in the three previous calendar years, and the SBA has approved this  Xa4definition.;&HaD3 {O'#X\  P6G;IP#э 47 C.F.R.  90.814(b)(1) and 90.912(b)(1). See Amendment of Parts 2 and 90 of the Commission's Rules to Provide for the Use of 200 Channels Outside the Designated Filing Areas in the 896901 MHz and the 935940  {Ol 'MHz Bands Allotted to the Specialized Mobile Radio Pool, PR Docket No. 89583, Second Order on  {O6 'Reconsideration and Seventh Report and Order, 11 FCC Rcd 2639, 2693702 (1995); Amendment of Part 90 of  {O 'the Commission's Rules to Facilitate Future Development of SMR Systems in the 800 MHz Frequency Band, PR Docket No. 93144, First Report and Order, Eighth Report and Order, and Second Further Notice of Proposed Rulemaking, 11 FCC Rcd 1463 (1995). ; The actions taken in this Second Report and Order may apply to SMR providers that either acquired geographic area licenses through auction or held licenses before the auctions. We do not have data reflecting the total number of firms holding preauction licenses, nor how many of these providers have annual revenues of less than $15 million. Consequently, for purposes of this FRFA, we estimate that all of the preauction SMR authorizations may be held by small entities, some of which may be affected by the actions taken in this Second Report and Order.  16. The Commission has held two auctions for geographic area SMR licenses. Sixty winning bidders in the 900 MHz auction qualified as small entities, and 38 in the 800 MHz auction. Based on this information, we estimate that the number of geographic area SMR licensees that may be affected by the actions taken in this Second Report and Order includes these 98 small entities. An additional 230 channels in the lower portion of the 800 MHz SMR band will be made available in a future auction. However, the Commission has not yet determined how many licenses will be offered, and thus at this time there is no basis on which to estimate how many small entities may win these licenses. Given that nearly all radiotelephone companies have fewer than 1,000 employees and that no reliable estimate of the number of prospective 800 MHz licensees can be made, we estimate, for purposes of this FRFA, that all of the licenses may be awarded to small entities, some of which may be affected by the actions taken in this Second Report and Order.  X~417. 220 MHz Radio Service. The 220 MHz service has both PhaseI and PhaseII licenses. There are approximately 1,515 Phase I non-nationwide licensees and four nationwide licensees currently authorized to operate in the 220 MHz band. The Commission has not developed a definition of small entities specifically applicable to such incumbent 220 MHz Phase I licensees. To estimate the number of such licensees that are small businesses,"$(&+&&" we apply the definition under the SBA rules applicable to radiotelephone communications  X4companies.i'D3 {Ob'#X\  P6G;IP#э See supra para. 6. i According to the Census Bureau, only 12 radiotelephone firms out of a total of  X41,176 such firms which operated during 1992 had 1,000 or more employees.(Z"D3 {O'#X\  P6G;IP#э 1992 Census, supra, UC92S1, Subject Series, Establishment and Firm Size, Table 5, Employment Size of Firms; 1992, SIC code 4812 (issued May 1995). Therefore, if this general ratio continues to 1999 in the context of PhaseI 220 MHz licensees, we estimate that nearly all such licensees are small businesses under the SBA's definition. 18. The PhaseII 220 MHz service is a new service, and is subject to spectrum  X_4auctions. In the 220 MHz Third Report and Order we adopted criteria for defining small businesses for purposes of determining their eligibility for special provisions such as bidding  X34credits.)"3|D3 yO'#X\  P6G;IP#э 220 MHz Third Report and Order, PR Docket No. 89552, 12 FCC Rcd 10943, 11068-70,  291-295 (1997).  {O`'The SBA has approved these definitions. See Letter from A. Alvarez, Administrator, SBA, to D. Phythyon, Chief, Wireless Telecommunications Bureau, FCC (Jan. 6, 1998).  We have defined a small business as an entity that has average gross revenues not  X 4exceeding $15 million for the preceding three years.* D3 {O'#X\  P6G;IP#э 47 C.F.R.  90.1021(b). See also 220 MHz Third Report and Order, supra, 12 FCC Rcd at 11068-69,  291. The Commission has held two auctions for Phase II 220 MHz licenses, and in them 53 entities that qualified as small or very small entities were winning bidders.  X 419. Paging. The Wireless Telecommunications Bureau has announced a series of auctions of paging licenses, offering a total of 16,630 nonnationwide geographic area  X4licenses.+\0 D3 {O'#X\  P6G;IP#э See Future Development of Paging Systems, Second Report and Order and Further Notice of Proposed  {Ow'Rulemaking, WT Docket 9618, 12 FCC Rcd 2732, 2863 (1997).  The first auction will commence on February 24, 2000, and will consist of 2,499  X}4licenses.,X} D3 yO'#X\  P6G;IP#э Public Notice, Auction of 929 and 931 MHz Paging Service Spectrum, Report No. AUC9926B, DA No. 991591 (Wireless Telecom. Bur. Aug. 12, 1999). For purposes of these auctions, a small business is defined as an entity that, together with affiliates and controlling principals, has average gross revenues for the three preceding calendar years of not more than $15 million. The SBA has approved this  X84definition.-Z8D3 {O"'#X\  P6G;IP#э See Letter from A. Alvarez, Administrator, SBA, to A.J. Zoslov, Chief, Auctions Division, Wireless Telecommunications Bureau, FCC (Dec. 2, 1998). Given the fact that nearly all radiotelephone companies had fewer than 1,000 employees, and that no reasonable estimate of the number of prospective paging licensees could be made, the Commission has assumed, for purposes of the evaluations and conclusions" )>-+&&" in the FRFA, that all the auctioned 16,630 geographic area licenses would be awarded to  X4small entities..\D3 {Ob'#X\  P6G;IP#э See Future Development of Paging Systems, Second Report and Order and Further Notice of Proposed  {O,'Rulemaking, WT Docket 9618, 12 FCC Rcd 2732, 286364 (1997).   X420. In addition, our Third CMRS Competition Report estimated that as of January  X41998, there were more than 600 paging companies in the United States./$D3 yO{'#X\  P6G;IP#э Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993, Annual Report and  {OC 'Analysis of Competitive Market Conditions With Respect to Commercial Mobile Services, Third Report, FCC  {O '989, at 40 (June 11, 1998) (Third CMRS Competition Report).  The Third CMRS  X4Competition Report also indicated that at least ten of the top twelve publicly held paging companies had average gross revenues in excess of $15 million for the three years preceding  Xe41998.0eD3 {O^'#X\  P6G;IP#э See Third CMRS Competition Report, App. C at 5. Data obtained from publicly available company documents and SEC filings indicate that this is also true for the three years preceding 1999.  X 421. Narrowband PCS. The Commission has auctioned 11 nationwide and 30 regional licenses for narrowband PCS. The Commission does not have sufficient information to determine whether any of these licensees are small businesses within the SBAapproved definition for radiotelephone companies. At present, there have been no auctions held for the major trading area (MTA) and basic trading area (BTA) narrowband PCS licenses. The Commission anticipates a total of 561 MTA licenses and 2,958 BTA licenses will be awarded by auction. Such auctions have not yet been scheduled, however. Given that nearly all radiotelephone companies have no more than 1,500 employees and that no reliable estimate of the number of prospective MTA and BTA narrowband licensees can be made, we assume, for purposes of this FRFA, that all of the licenses will be awarded to small entities, as that term is defined by the SBA.  X422. Rural Radiotelephone Service. The Commission has not adopted a definition of  X4small entity specific to the Rural Radiotelephone Service.1D3 yO'#X\  P6G;IP#э The service is defined in section 22.99 of the Commission's rules, 47 C.F.R.  22.99. A significant subset of the Rural  X4Radiotelephone Service consists of Basic Exchange Telephone Radio Systems (BETRS).22 D3 yO '#X\  P6G;IP#э BETRS are defined in sections 22.757 and 22.759 of the Commission's rules, 47 C.F.R.  22.757, 22.759.  X4We will use the SBA's definition applicable to radiotelephone companies, i.e., an entity  X4employing no more than 1,500 persons.i3 D3 {Oa$'#X\  P6G;IP#э See supraĠpara. 6. i There are approximately 1,000 licensees in the"*T 3+&&5" Rural Radiotelephone Service, and we estimate that almost all of them qualify as small entities under the SBA's definition.  X423. AirGround Radiotelephone Service. The Commission has not adopted a  X4definition of small entity specific to the AirGround Radiotelephone Service.4D3 yO'#X\  P6G;IP#э The service is defined in section 22.99 of the Commission's rules, 47 C.F.R.  22.99. Accordingly,  X4we will use the SBA's definition applicable to radiotelephone companies, i.e., an entity  Xz4employing no more than 1,500 persons.w5z D3 yO '#X\  P6G;IP#э 13 C.F.R.  121.201, SIC Code 4812. w There are approximately 100 licensees in the AirGround Radiotelephone Service, and we estimate that almost all of them qualify as small entities under the SBA definition.  X 424. Offshore Radiotelephone Service. This service operates on several UHF television broadcast channels that are not used for TV broadcasting in the coastal area of the states  X 4bordering the Gulf of Mexico.6 D3 {O'#X\  P6G;IP#э This service is governed by Subpart I of Part 22 of the Commission's Rules. See 47 C.F.R. 22.1001-.1037. At present, there are approximately 55 licensees in this service. We are unable at this time to estimate the number of licensees that would qualify as small entities under the SBA's definition for radiotelephone communications.  X425. Wireless Communications Services (WCS). This service can be used for fixed, mobile, radio location and digital audio broadcasting satellite uses. The Commission defined small business for the WCS auction as an entity with average gross revenues that are not more than $40 million for each of the three preceding years, and a very small business as an entity with average gross revenues that are not more than $15 million for each of the three preceding years. The Commission auctioned geographic area licenses in the WCS service. In the auction, there were seven winning bidders that qualified as very small business entities, and one that qualified as a small business entity. We conclude that the number of geographic area WCS licensees that may be affected by the actions taken in this Second Report and Order includes these eight entities.  X426. Cable Services or Systems. The SBA has developed a definition of small entities for cable and other pay television services, which includes all such companies generating $11  Xo4million or less in revenue annually.r7oBD3 yO!'#X\  P6G;IP#э 13 C.F.R.  121.201, SIC 4841. r This definition includes cable systems operators, closed circuit television services, direct broadcast satellite services, multipoint distribution systems, satellite master antenna systems and subscription television services. According to the Census"A+7+&&_" Bureau data from 1992, there were 1,788 total cable and other pay television services and  X41,423 had less than $11 million in revenue.08ZD3 {Ob'#X\  P6G;IP#э 1992 Economic Census Industry and Enterprise Receipts Size Report, Table 2D, SIC code 4841 (U.S. Bureau of the Census data under contract to the Office of Advocacy of the U.S. Small Business Administration). 0 27. The Commission has developed its own definition of a small cable system operator for the purposes of rate regulation. Under the Commission's rules, a small cable  X4company is one serving fewer than 400,000 subscribers nationwide.9D3 yO` '#X\  P6G;IP#э 47 C.F.R.  76.901(e). The Commission developed this definition based on its determination that a small  {O( 'cable system operator is one with annual revenues of $100 million or less. Implementation of Sections of the  {O '1992 Cable Act: Rate Regulation, Sixth Report and Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393 (1995), 60 FR 10,534 (Feb. 27, 1995).  Based on our most recent information, we estimate that there were 1,439 cable operators that qualified as small  X_4cable system operators at the end of 1995.:_D3 {O'#X\  P6G;IP#э Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 1996 (based on figures for December 30, 1995). Since then, some of those companies may have grown to serve over 400,000 subscribers, and others may have been involved in transactions that caused them to be combined with other cable operators. Consequently, we estimate that there are fewer than 1,439 small entity cable system operators. 28. The Communications Act also contains a definition of a small cable system operator, 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  X 4any entity or entities whose gross annual revenues in the aggregate exceed $250,000,000.j; h D3 yO'#X\  P6G;IP#э 47 U.S.C.  543(m)(2). j The Commission has determined that there are 66,000,000 subscribers in the United States. Therefore, we found that an operator serving fewer than 660,000 subscribers shall be deemed a small operator, if its annual revenues, when combined with the total annual revenues of all  XK4of its affiliates, do not exceed $250 million in the aggregate.k<K D3 yO,'#X\  P6G;IP#э 47 U.S.C.  76.1403(b). k Based on available data, we  X44find that the number of cable operators serving 660,000 subscribers or less totals 1,450.=4 D3 {O'#X\  P6G;IP#э Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 1996 (based on figures for Dec. 30, 1995). We do not request nor do we collect information concerning whether cable system operators  X4are affiliated with entities whose gross annual revenues exceed $250,000,000,>"D3 yO #'#X\  P6G;IP#э We do receive such information on a casebycase basis only if a cable operator appeals a local franchise authority's finding that the operator does not qualify as a small cable operator pursuant to section 76.1403(b) of  {O$'the Commission's rules. See 47 C.F.R.  76.1403(d).  and thus are",<>+&&" unable at this time to estimate with greater precision the number of cable system operators that would qualify as small cable operators under the definition in the Communications Act. It should be further noted that recent industry estimates project that there will be a total of 66,000,000 subscribers.  X' (d)XDescription of Projected Reporting, Recordkeeping and Other Compliance Requirements.(#  X_4 29. In this Second Report and Order we affirm our proposals in the NPRM to clarify  X14what entities, services, and facilities are subject to CALEA.x?1D3 yO '#X\  P6G;IP#э Second Report and Order,  628. x In addition, we provide guidance regarding the factors the Commission will consider when determining under section 109 of CALEA if compliance with the assistance capability requirements of the Act is reasonably achievable, as well as the showings that entities filing petitions under section 109  X 4will be expected to make.k@ D3 {O'#X\  P6G;IP#э Id.,  2945. k These actions impose no reporting, recordkeeping or other compliance requirements beyond those imposed by CALEA itself.  Xy' (e)XSteps Taken to Minimize Significant Economic Impact on Small Entities, and  Xb'Significant Alternatives Considered. (# 30. We have largely adopted the tentative conclusions of the NPRM as to what entities are and are not subject to the assistance capability requirements. Although section 102(8)(B)(ii) of CALEA gives us the discretion, we have decided not to exempt any categories in our rules. We have resolved the concern mentioned most frequently in the comments"regarding the dispatch service of traditional SMR operators"by finding such operations to be outside CALEA's definition of telecommunications carrier insofar as the service is not interconnected with the public switched network. We have considered AMTA's argument that CMRS providers serving niche business markets with limited interconnect capability are not technologically capable of CALEA compliance, but we have found that to the extent their services meet the definition of CMRS set forth in section 332(d) of the Communications Act, such entities must be considered subject to CALEA. In response to those commenters who argue that a private mobile radio service (PMRS) operator cannot be subject to CALEA for any reason, we have found that where a PMRS operator uses its facilities to offer a service that qualifies as CMRS, that service is subject to CALEA. 31. We recognize that compliance with the assistance capability requirements may be economically burdensome for some entities. CALEA provides two mechanisms through" -@+&&b" which carriers may seek relief: they may petition the Commission for an extension of the compliance date under section 107(c), and they may petition the Commission for a determination that compliance is not reasonably achievable under section 109(b). We believe these mechanisms provide the best approach to avoiding undue burdens on small entities,  X4without undercutting the objectives of CALEA.oAD3 {O'#X\  P6G;IP#э See id.,  3645. o We are also prepared to reexamine whether any categories of service providers should be exempted, once we have gained some experience in applying section 109. 32. We have decided that in determining whether compliance with the assistance capability requirements is reasonably achievable, we will not at this time accord special significance to any particular factor enumerated in section 109 and we will not adopt any additional factors. As we note in the Report and Order, the technological diversity of carrier networks, as well as other carrier characteristics, will, as a matter of course, mean that certain factors will be more important to the arguments of certain carriers than others, and not all of the factors enumerated in section 109 may be relevant to the analysis of a given reasonable  X 4achievability petition.dB "D3 {O'#X\  P6G;IP#э Id.,  37. d We recognize, however, that carrier size may be a significant consideration in particular cases, and we reject AT&T's assertion that special consideration for a new market entrant could be tantamount to an unfair subsidy.  X4' (f)XReport to Congress(#  X4 33. The Commission shall send a copy of this Second Report and Order, including this FRFA, in a report to Congress pursuant to the Small Business Regulatory Enforcement  X4Fairness Act of 1996.vCD3 {Ou'#X\  P6G;IP#э See 5 U.S.C.  801(a)(1)(A). v In addition, the Commission shall send a copy of this Second Report and Order, including this FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of this Second Report and Order and FRFA (or summaries thereof) will also be published in the Federal Register.