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G;hX2%<b"5^2BoddȦ8BBdr2B28ddddddddddBBrrrdzNdzoȐB8BtdBdoYoYBdo8Bo8odooYNBodddYO,Oh2BBBBPBdodddddȐYYYYYN8N8N8N8oddddooooddoddddzodddYYYYYdddooPoNoNBNoddȐoNNF2ldBddddddd<d<BBoodBBddBoBddzzzzzzzzzzBBBBozdddddddYYYYY8888dddddddndddddYd"5^(2< yO ' " #X\  P6G;/P#эThe petitioning parties, and parties filing oppositions to or comments in support of the petitions, are listed in Appendix A. of the Commission's Rate Integration Reconsideration Order,\  yOx' "c #X\  P6G;/P#эPolicy and Rules Concerning the Interstate, Interexchange Marketplace, Implementation of Section 254(g)  {O@' x of the Communications Act of 1934, as amended, CC Docket No. 9661, First Memorandum Opinion and Order  {O 'on Reconsideration, 12 FCC Rcd 11,812 (1997) ("Rate Integration Reconsideration Order"). in which  xcwe found that the rate integration requirements of section 254(g) of the Communications Act of  X{4 x1934, as amended ("Act"),n{D> yOp'#X\  P6G;/P#э47 U.S.C.  254(g).n apply to the interstate, interexchange services of Commercial Mobile  xMRadio Service ("CMRS") providers. The petitioners request that we reconsider that determination.  xIn the alternative, if we find that section 254(g) applies to CMRS providers, the petitioners  xrequest that we forbear from applying section 254(g) to the interstate, interexchange services  X4offered by CMRS providers pursuant to section 10 of the Act.n> yO'#X\  P6G;/P#э47 U.S.C.  160(a).n  X4 e 2.` ` In this order, we reaffirm our earlier determination that, based on the plain  xlanguage of the statute, the rate integration requirements of section 254(g) apply to interstate,  x'interexchange services offered by CMRS providers, and therefore deny the petitions for  xreconsideration of this determination. We clarify, however, that CMRS traffic within a major  X4 xctrading area (MTA)(intraMTA traffic) is not "interexchange" traffic and thus not subject to the  X~4 xrate integration requirements of section 254(g). We deny the petitions seeking forbearance from  xthe application of rate integration to separatelybilled toll charges. On the basis of the record  xbefore us, we find that forbearance from rate integration of separatelybilled toll charges is not"Pd +='='ZZh"  X4 xconsistent with the public interest prong of the threepart forbearance test.q> yOy'#X\  P6G;/P#э47 U.S.C.  160(a)(3).q We also deny the  X4 xother requests for forbearance relief from rate integration. With respect to these issues, we  xdetermine that we have insufficient information on which to determine whether the test for the grant of forbearance under section 10 of the Act is satisfied.  X4 e m3.` ` We also here state our intent to issue a Further Notice seeking comment on issues  xcrelating to airtime and roaming charges associated with interstate, interexchange calls for which  xca separate charge is stated; widearea CMRS calling plans; and the affiliation requirements that  x+should be applicable to services subject to the rate integration requirement. Pending further  xrulemaking, we keep in place the Order adopted by the Commission on October 2, 1997, in  x+which the Commission stayed the application of the requirement that providers of interstate,  xIinterexchange services integrate rates across affiliates, as well as application of rate integration  X 4requirements with respect to wide area rate plans offered by CMRS providers.\ X> yO' "c #X\  P6G;/P#эPolicy and Rules Concerning the Interstate, Interexchange Marketplace, Implementation of Section 254(g)  {O' x of the Communications Act of 1934, as amended, CC Docket No. 9661, Order, 12 FCC Rcd 15,739 (1997) ("Rate  {O'Integration Stay Order").  X 4g< II. BACKGROUND ă  X4 e 4.` ` CMRS providers serve customers using mobile phone units that may originate or  xreceive calls at locations within range of a compatible cell transmitter site. CMRS customers  xgenerally pay a flat monthly fee and an airtime charge for service within a defined local calling  xarea. Some of these plans may include a specified number of local airtime minutes as part of  xthe flat monthly charge. If a customer makes a longdistance call from within its local calling  xVarea, the customer may also pay a longdistance charge. When roaming, the customer also will  xgenerally pay a roaming charge for originating a call, or receiving a call, outside its plans service  xarea. If making a call when roaming, a customer will generally pay a longdistance charge for  xterminating a call outside the local calling area in which the call was originated. Conversely, if  xa customer receives a call from outside the local calling area of the roamed upon carrier, a  xcustomer may be assessed a toll charge for transmitting the call from the customer's home switch  x<to the switch of the roamed upon carrier. Many CMRS providers offer widearea calling plans  xthat permit customers to make calls without roaming or longdistance charges over a calling area  xwider than the local calling area. These widearea calling plans may be regional, or they may  x4offer national coverage. Prior to the 1996 Act, the Commission had not applied any rate  X74 xintegration obligations to CMRS providers and had forborne from, inter alia, applying sections  X"4203205s"|> yOO$'#X\  P6G;/P#э47 U.S.C.  203205.s to CMRS services.R" > yO' "_ #X\  P6G;/P#эImplementation of Sections 3(n) and 332 of the Communications Act, Regulatory Treatment of Mobile  {OX'Services, Second Report and Order, GN Docket No. 93252, 9 FCC Rcd 1411 (1994) ("CMRS Forbearance Order").R"""+='='ZZ"Ԍ X4 e ԙ5.` ` In the 1996 Act, "> yO'#X\  P6G;/P#эTelecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996). Congress enacted section 254(g), which, as relevant to this order,  xrequires that a "provider of interstate, interexchange service shall provide such services to its  xpsubscribers in each state at rates no higher than the rates charged to its subscribers in any other  X4 xstate."n > yO '#X\  P6G;/P#э47 U.S.C.  254(g).n In March 1996, we released a notice of proposed rulemaking seeking comment on, inter  X4alia, proposed rules to implement the rate integration provision of section 254(g).X B> {O ' " #X\  P6G;/P#эSee generally Policy and Rules Concerning the Interstate, Interexchange Marketplace, Notice of Proposed  {Oc 'Rulemaking, CC Docket No. 96-61, 11 FCC Rcd 7141 (1996) ("Rate Averaging and Rate Integration NPRM"). X  Xz4 e #6.` ` On August 7, 1996, in the Rate Integration Order, \z> yO' " #X\  P6G;/P#эPolicy and Rules Concerning the Interstate, Interexchange Marketplace, Implementation of Section 254(g)  {O' x  of the Communications Act of 1934, as amended, CC Docket No. 9661, Report and Order, 11 FCC Rcd 9564  {O['(1996) ("Rate Integration Order"); see 47 C.F.R.  64.1801.  the Commission adopted a rate  xIintegration rule that reiterated the language of section 254(g). The Commission stated that this  xrule would incorporate its existing rate integration policy, and would apply to all interstate,  X74 xinterexchange services, as defined in the Act, and to all providers of these services.m 7 > {O'#X\  P6G;/P#эId. at 958699.m We  xRinterpreted the term "provider," as used in section 254(g), "to include parent companies that,  X 4 x8through affiliates, provide service in more than one state."t T > {O'#X\  P6G;/P#эId. at 9598, para. 69.t Although we did not expressly  X 4 xaddress application of rate integration to CMRS providers, we did determine, inter alia, that  xAmerican Mobile Satellite Carriers Subsidiary Corp. ("AMSC") is required to integrate rates  xcharged for its offshore services into the rate structure offered for its mainland services because  xits services appear to fall within the definition of interstate, interexchange telecommunications  X4services subject to section 254(g).t> {O/'#X\  P6G;/P#эId. at 9589, para. 54.t  Xj4 e 7.` ` On July 30, 1997, the Commission denied several petitions for reconsideration of  XS4 xthe Rate Integration Order.Sx> {O|#'#X\  P6G;/P#эRate Integration Reconsideration Order, 12 FCC Rcd 11,812. The Commission clarified that the rules implementing section  x254(g) require carriers to integrate their rates across affiliates, but do not require a carrier to  xintegrate an interstate, interexchange CMRS service with other interstate, interexchange service "' +='='ZZY"  X4 xyofferings.o> {Oy'#X\  P6G;/P#эId. at 11,81822.o The Commission stated that its rate integration rules require CMRS providers to  xprovide interstate, interexchange CMRS services on an integrated basis in all states in which  X4they provide services.vZ> {O'#X\  P6G;/P#эId. at 11821, para. 18. v  X4 e v8.` ` On October 2, 1997, the Commission stayed application of the requirement that  xCMRS providers of interstate, interexchange services integrate rates across affiliates pending  Xv4 xVfurther reconsideration.v> {O '#X\  P6G;/P#эRate Integration Stay Order, 12 FCC Rcd 15,739. The Commission also stayed, pending reconsideration, the application  X_4 xof rate integration requirements with respect to widearea rate plans offered by CMRS providers.a_~> {O '#X\  P6G;/P#эId.a  X1' - II. PETITIONS FOR RECONSIDERATION ă  X '  A.XApplicability of Section 254(g) to Interstate, Interexchange Services of CMRS  X 'Providers   X 4 e 9.` ` Initially, we address the claims of the petitioners that we erred in the Rate  X 4 xIntegration Reconsideration Order in clarifying that the rate integration provision of section  x254(g) applies to interstate, interexchange services offered by CMRS providers. The petitioners  X}4 xVargue that the Commission has never applied rate integration to CMRS services,}> {O>'#X\  P6G;/P#эSee, e.g., AirTouch Petition at 6. and contend  x&that Congress did not intend to extend rate integration to interstate, interexchange services offered  XO4 xdby CMRS providers.}O> {O'#X\  P6G;/P#эSee, e.g., CTIA Petition at 2. } The petitioners claim that Congress intended only to codify the  x+Commission's thencurrent policy of requiring wireline carriers to integrate the rates of their  X!4 xinterstate, interexchange services.!4 > {O'#X\  P6G;/P#эSee, e.g., Bell Atlantic Mobile Petition at 7. As support, the petitioners cite to language in the legislative  xRhistory stating that "[t]he conferees intend the Commission's rules to require geographic rate  x8averaging and rate integration, and to incorporate the policies contained in the Commission's  xproceeding entitled "Integration of Rates and Services for the Provision of Communications by  xAuthorized Common Carriers between the United States Mainland and the Offshore Points of  X4 xHawaii, Alaska and Puerto Rico/Virgin Islands (61 FCC 2d 380 (1976))." > {O%%'#X\  P6G;/P#эSee, e.g., Bell Atlantic Mobile Petition at 7. According to the  xpetitioners, because of the differences between wireline and wireless services and the difficulties"X +='='ZZ"  xcof applying rate integration to wireless services, Congress could not have intended to take away  xIthe customer benefits of competitive response and pricing flexibility that exist in the competitive  X4 x<CMRS market.|> {OK'#X\  P6G;/P#эSee, e.g., PCIA Petition at 6.| In addition, some of the petitioners point to language of the Rate Integration  X4 xOrder itself, where the Commission stated that it was adopting its existing policies on rate  xlintegration as further evidence that the Commission did not intend rate integration to apply to  X4CMRS providers.mZ> yO'#X\  P6G;/P#эBellSouth Reply at 5.m  Xc4 e  10.` ` We decline to reconsider our determination that the rate integration requirement  xof section 254(g) applies to CMRS providers. Section 254(g) requires that "[a] provider of  xinterstate interexchange services shall provide its services to subscribers in a state at rates no  X 4 xRhigher than provided to subscribers in any other state."n > yO'#X\  P6G;/P#э47 U.S.C.  254(g).n The language of section 254(g), as  X 4 xhAlaska and Hawaii note, z> yO2'#X\  P6G;/P#эHawaii Opposition at 2; Alaska Opposition at 2. on its face unambiguously applies to all providers of interstate,  xinterexchange services. Thus, section 254 (g) applies to the interstate, interexchange services  xoffered by CMRS providers. If Congress had intended to exempt CMRS providers, it presumably  X 4 xRwould have done so expressly as it did in other sections of the Act.Q" > {O}' " #X\  P6G;/P#эSee, e.g., 47 U.S.C.  153(26) (excluding CMRS providers from the definition of local exchange carrier,  x& except to the extent the Commission decides otherwise); 47 U.S.C.  271(g)(3) (classifying interLATA CMRS  x services as one of the incidental interLATA services that the Bell companies could offer without prior Commission approval); and 47 U.S.C.  274(i)(2)(b) (exempting CMRS services from the definition of basic telephone services).Q Thus, we reaffirm our  xcearlier determinations that the rate integration language of section 254(g) applies to all providers  xof interstate, interexchange services, including CMRS providers. We conclude that any reference  xto the existing rate integration policy by Congress or by this Commission merely identified the  xVoverarching policy under consideration, and was not intended to exempt from application of that policy any carrier or class of carriers, as the petitioning parties suggest.  X!4 e  11.` ` Because the language of the statute is unambiguous and plainly applies to CMRS  X 4 xcproviders, we need not examine the legislative history of section 254(g).yZ  > {O ' " #X\  P6G;/P#эChevron USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 84243 (1984) (if the court,  x. after "employing traditional tools of statutory construction," determines that the intent of Congress is clear, "that is the end of the matter.").y Assuming, arguendo,  x}some ambiguity in the statutory language, thus requiring an examination of the legislative history,  xIwe find nothing in that legislative history that unambiguously indicates that CMRS providers are  xpexempted from section 254(g). The language referenced by the CMRS providers could readily  xbe read as identifying the policy to be applied to all providers of interstate, interexchange services"+='='ZZ\"  x"as reasonably as it could be read to suggest the codification of rate integration as applied to the  X4wireline industry.iZ> {Ob' " #X\  P6G;/P#эSee Alaska Opposition at 4 (contending that the use of a comma after rate integration, followed by "and to  x incorporate" indicates that Congress intended rate integration to apply to all providers of interstate, interexchange services).i   X4  X4 e 9 12.` ` Similarly, we reject the argument raised by AirTouch that Congress did not intend  x"rate integration to apply to CMRS providers because rate integration is unnecessary to achieve  X4 xVthe policy goals underlying section 254(g). > {O( '#X\  P6G;/P#эAirTouch Petition at 3; accord, BellSouth Petition at 56. AirTouch states that rate integration is designed to  xenable subscribers in rural and offshore areas to obtain some of the benefits of rate decreases  xcreated by competitive pressures on access charges and longdistance rates in more urban areas,  xand to protect customers in those areas from bearing the full burden of higher local exchange  X14 x@costs.}!1|> yO^'#X\  P6G;/P#э AirTouch Petition at 3. } AirTouch appears to conflate rate integration with rate averaging. Rate averaging, which  xis also required by section 254(g), does have the described effect of protecting customers in high  xcost local exchange areas from bearing the full burden of those costs. Rate integration, on the  xother hand, generally focuses on the distancesensitive aspects of the rate structures for  xinterexchange services. It protects noncontiguous parts of the United States, such as Alaska and  x/Hawaii, from being discriminated against because they are not part of the contiguous 48 states.  xAirTouch's focus on exchange cost differences is, therefore, misplaced and we disagree with its interpretation of the statute.  Xb4 e  13.` ` Next, AirTouch contends that CMRS providers are not deemed to be interexchange  xcarriers as that term is understood by Congress, the Commission, and the industry; rather, CMRS  x3providers are considered to be a different class of carrier and an economic interest group separate  X4 xfrom providers of interstate, interexchange services." > {O'#X\  P6G;/P#эSee, e.g., AirTouch Petition at 8. In support of this position, AirTouch  x&observes that CMRS providers do not pay access charges, are not listed as interexchange carriers  x&on LEC equal access ballots, and were not discussed when the Commission considered detariffing  X4 x}for nondominant interexchange carriers.g#> {O' '#X\  P6G;/P#эId.g Several CMRS providers assert that CMRS services  X4 xdo not readily fit into the exchange/interexchange mold.$0 > {O"'#X\  P6G;/P#эSee, e.g., Primeco Petition at 20. Primeco argues that CMRS providers  x"can be excluded from rate integration obligations as a class based on the unique characteristics  X4of the industry.o% > yO&'#X\  P6G;/P#эPrimeco Petition at 21.o"R %+='='ZZ9"Ԍ X4 e vԙ 14.` ` Although CMRS providers may be characterized as providers of exchange and  x exchange access services, that characterization does not preclude a finding that some of a CMRS  xprovider's service offerings are interstate, interexchange services. While CMRS providers do not  x/pay access charges for originating or terminating local exchange calls, CMRS providers do pay  xAaccess charges when an interexchange call originates or terminates on landline facilities.  xSimilarly, that, in some instances, CMRS providers are regulated in a manner different from other  xcarriers, does not compel a conclusion that the interstate, interexchange services of CMRS providers are not subject to the rate integration requirements of section 254(g).  X14 e v15.` ` We also reject the argument that applying section 254(g) to CMRS providers is  X 4 x=inconsistent with section 332 of the Act& > {O '#X\  P6G;/P#э47 U.S.C.  332. See Bell Atlantic Mobile Petition at 19. because it allegedly undermines the distinct  X 4 xderegulatory paradigm applicable to CMRS providers.+' Z> yO' "& #X\  P6G;/P#эBell Atlantic Mobile Petition at 19 (distinguishing the regulatory scheme applicable to CMRS providers from  {O'that applicable to landline carriers); accord, TDS Petition at 2.+ Bell Atlantic Mobile asserts that the  xprice regulation required by section 254(g) is precisely that which the Commission and Congress  X 4 xhave deemed unnecessary and harmful to the public interest in the CMRS context.a( > {O:'#X\  P6G;/P#эId.a Section  xp332(c), however, expressly provides that sections 201 and 202 of the Act shall continue to apply  X 4 x&to CMRS providers.n) F> yO'#X\  P6G;/P#э47 U.S.C.  332(c).n Section 201(b) requires just and reasonable rates and 202(a) prohibits rates  x_that are unreasonably discriminatory. These requirements necessarily imply some degree of  xregulatory concern with prices; section 332 cannot, therefore, be read to bar every form of  xoversight over CMRS rates. Furthermore, the rate integration policy codified in section 254(g)  xderived from section 202(a) the requirement that rates not be unreasonably discriminatory.  xFinally, we note that other provisions of Title II of the Act apply to CMRS providers. For  X4 xpexample, the interconnection requirements of section 251(a) clearly apply to CMRS providers;n*> yO'#X\  P6G;/P#э47 U.S.C.  251(a).n  X4 xCMRS providers are as capable as any other carrier of invoking the protections of section 253;k+f > yO'#X\  P6G;/P#э47 U.S.C.  253.k  x"and, CMRS providers are among the providers of interstate services who are required to make  X4 xuniversal service contributions pursuant to section 254(d).n, > yO"'#X\  P6G;/P#э47 U.S.C.  254(d).n Thus, we conclude that the application of section 254(g) to CMRS providers is not inconsistent with section 332.  X4 e 16.` ` We find unpersuasive the argument that, because we held that CMRS rates did not  xhave to be integrated with the rates of affiliated longdistance providers, we did not intend rate"| ,+='='ZZ="  X4 xpintegration to apply to CMRS providers.-> yOy'#X\  P6G;/P#эPrimeco Petition at 22; BellSouth Reply at 89. Rather, that decision addresses the issue of how rate  xintegration should be applied to different interstate, interexchange services, and was consistent  x/with the longstanding Commission practice of applying rate integration on a servicebyservice  X4 x<basis.b.X> {O'#X\  P6G;/P#эId. b That decision does not address the question of whether rate integration should apply to  xCMRS providers at all. Similarly, CMRS providers' exemption from the equal access  X4 x@requirements applicable to incumbent LECs does not, as some CMRS providers suggest,/> {O( '#X\  P6G;/P#эSee, e.g., Primeco Petition at 22. address  xwhether CMRS providers provide interstate, interexchange services and thus whether rate integration should apply to CMRS providers.  X14 e i17.` ` Several CMRS providers allege that the Commission gave inadequate notice to  X 4 xpermit application of section 254(g) to CMRS providers.0 |> yOG'#X\  P6G;/P#эBellSouth Petition at 12; Bell Atlantic Mobile Petition at 4; PCIA Petition at 3. They state that CMRS providers were  X 4 x/only mentioned in a footnote, noting that similar notice was found to be inadequate in McElroy  X 4 xElectronics Corp. v. FCC.1 > {O' "y #X\  P6G;/P#эMcElroy Electronics Corp. v. FCC, 990 F.2d 1351 (D.C. Cir. 1993). See Bell Atlantic Mobile Petition at 6. These parties assert that adequate notice required specific mention  xof the applicability of rate integration to CMRS providers because applying rate integration to  X 4 xcCMRS providers goes beyond the existing policy.2 f > {O'#X\  P6G;/P#эSee, e.g., Bell Atlantic Mobile Petition at 2; BellSouth Petition at 611. AirTouch states that only one cellular party  X 4 xfiled comments in response to the notice,o3 > yOT'#X\  P6G;/P#эAirTouch Petition at 8.o and BellSouth states that no party addressed the issue  X4 xVof extending rate integration to CMRS providers.q4 > yO'#X\  P6G;/P#эBellSouth Petition at 12.q Several CMRS providers note that the initial  X}4 x+discussion of applying rate integration to CMRS providers occurred in the Rate Integration  Xh4 xReconsideration Order.5h> {O1 '#X\  P6G;/P#эSee, e.g., BellSouth Petition at 11. BellSouth asserts that, because of the significant differences between  xCMRS and wireline carriers, the lack of discussion of how rate integration would be implemented  x}in the CMRS context establishes that the Commission did not address the link between the facts  X%4and the policy choice in applying section 254(g) to the CMRS industry.t6%> yO$'#X\  P6G;/P#эBellSouth Petition at 1314.t " :6+='='ZZ"Ԍ X4 e 18.` ` As we stated in the Rate Integration Stay Order, we do not agree that inadequate  xcnotice was given to hold that the rate integration requirements of section 254(g) apply to CMRS  X4 xproviders. The language of section 254(g) applies to providers of interexchange  xtelecommunications services with no exceptions enumerated. Elsewhere in the Act, as we noted  x}above, when Congress wanted to exempt CMRS providers from a requirement of the Act, it did  xVso expressly. The words of the statute clearly encompass CMRS providers and legally obligate  xthem to integrate their interstate, interexchange services. Our rule, implementing section 254(g),  Xa4 x merely reiterated the precise terms of the statute. Further, we note that the Rate Averaging and  XL4 xcRate Integration NPRM stated that an interexchange call includes all means of connecting two  X74 xpoints, "wireline or wireless."77> {O '#X\  P6G;/P#эRate Averaging and Rate Integration NPRM, 11 FCC Rcd at 7169, n.118. Specific notice of our intent to apply the plain language of the  xstatute was not required. We, therefore, find no relevant lack of notice regarding the application of rate integration requirements to providers of CMRS services.  X 4 e `19.` ` Our conclusion that adequate notice was given of the application of section 254(g)  xto CMRS providers is not altered by the fact that no party commented on the application of rate  x_integration to CMRS providers. As noted above, section 254(g), by its own terms, applies to  xproviders of interexchange services. CMRS providers, therefore, should have been on notice that  x'the rulemaking proceeding could affect their interests. Although rate integration had not  xlpreviously been applied to CMRS providers, the CMRS industry had been subject to the rate  xregulation of section 202(a) of the Act and, thus, the industry should have been alert to the broad  xscope of section 254(g), which has its origins in section 202(a). Moreover, section 254(g) was  xVenacted as part of the 1996 Act; therefore, the application of that section to the CMRS industry  xdoes not represent a change in Commission policy requiring more specific notice. Finally, we  x conclude that because we only codified the language of section 254(g), we find no issue concerning the adequacy of the record to support adoption of the rule.  X4 e 20.` ` In any event, we find that the present reconsideration record supports the  x"conclusion that section 254(g) applies to CMRS providers. We note that we stayed application  xof the affiliation requirement and application of rate integration to widearea plans, the two cases  xin which we believe we would benefit from a fuller record. We continue to believe a fuller  x record on these two issues would be beneficial and, therefore, will seek further comment on those issues to develop a better record in a separate proceeding.  X4 e 21.` ` AirTouch notes that CMRS carriers are not mentioned in the regulatory flexibility  xanalysis assessing the administrative burden of regulations on industry, and asserts that this  X4 x_reflects a lack of intent that section 254(g) be applied to CMRS providers.u8Z> yO#'#X\  P6G;/P#эAirTouch Petition at 7, n.18.u While the Final  X 4 x3Regulatory Flexibility Act analysis in the Rate Integration Order did not assess the administrative  xburden of regulations on CMRS providers, as AirTouch indicates, the omission does not evidence"! 8+='='ZZ? "  x<a lack of intent to apply section 254(g) to CMRS providers. We have prepared a Supplemental  X4 xlFinal Regulatory Flexibility Act analysis to redress our inadvertent oversight.m9> {Ob'#X\  P6G;/P#эSee Appendix B.m No party has  x}claimed that the omission caused material harm. Indeed, in the Rate Integration Stay Order, we  xstayed application of the rate integration requirement to widearea plans and across affiliates. Accordingly, those requirements had no impact on small entities.   Xv' B.XIntraMTA Calls (#  XH4 e 22.` ` In their petitions for reconsideration, the petitioners request that we clarify the  xRtreatment of traffic that originates and terminates within an MTA. CMRS providers oppose  xapplying rate integration to calls within the MTA in which the CMRS provider is licensed,  xalthough, in many cases, the licensed area will not correspond to a telephone company exchange  X 4 xarea, or to state boundaries.: Z> {O'#X\  P6G;/P#эSee, e.g., PCIA Petition at 10; CTIA Petition at 3. Alaska and Hawaii do not oppose excluding all calls that originate  X 4and terminate in the same MTA from the rate integration requirement.3;$ > {Or' " #X\  P6G;/P#эSee Letter from John W. Katz, Director of State/Federal Relations and Special Counsel to the Governor,  xZ State of Alaska, to William E. Kennard, Chairman, Federal Communications Commission, dated Nov. 25, 1998;  x} Letter from Herbert Marks, Esq., Counsel for the State of Hawaii, to William E. Kennard, Chairman, Federal  {O'Communications Commission, dated Nov. 24, 1998 ("Alaska Ex Parte Letter"). 3  X 4 e 23.` ` We conclude that treating intraMTA calls as not being subject to rate integration  x_is consistent with the definition of "telephone exchange service." The Act defines "telephone  x_exchange service" as "service within a telephone exchange, or within a connected system of  xptelephone exchanges within the same exchange area . . . and which is covered by the exchange  XK4 xIservice charge, or . . . comparable service provided through a system of switches, transmission  xequipment, or other facilities (or combination thereof) by which a subscriber can originate and  X4 xMterminate a telecommunications service."p<> yO'#X\  P6G;/P#э47 U.S.C.  153(47). p In the Local Competition Order,~=Gh  X84 x ԍ #X\  P6G;/P#Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, CC Docket  {O!'No. 9698, First Report and Order, 11 FCC Rcd 15499, 1599816000 (1996)(Local Competition Order), Order on  {O' xM Reconsideration, CC Docket No. 9698, 11 FCC Rcd 13042 (1996), vacated in part sub nom. Iowa Utils. Bd. v.  {O 'FCC, 120 F.3d 753 (8th Cir. 1997), cert. granted sub nom. AT&T Corp. v. Iowa Utils. Bd., 118 S.Ct. 879 (1998).~ we concluded that  x"cellular, broadband PCS, and covered SMR providers fall within at least the second part of this  X4 x+definition because they provide "comparable service" to telephone exchange service.>w > yO$'#X\  P6G;/P#эCellular and PCS providers, however, are not LECs, as that term is defined in the Act. 47U.S.C.3(26). Our  xdetermination was based on the finding that, as a general matter, CMRS carriers provide local,  X4 xtwoway switched voice service as a principal part of their business. Treating intraMTA CMRS" >+='='ZZX"  X4 xVcalls as local also is consistent with our conclusion in the Local Competition Order that MTAs  xdefined the area in which reciprocal compensation applies to interconnections between incumbent  X4 xLECs and CMRS providers.?> {OM'#X\  P6G;/P#эLocal Competition Order, 11 FCC Rcd. 16014. Because of the mobility of CMRS customers, the MTA, rather  x_than a smaller area, such as the CMRS provider's license area or a wireline exchange area,  xVreflects the minimum area in which customers may be expected to travel and within which they  xwould expect not to pay toll charges. Pursuant to this approach, calls within an MTA that would  Xx4be interstate will not be treated as interexchange.@xZ> {O ' "V #X\  P6G;/P#эSee also 47 U.S.C.  221(b) ("[s]ubject to the provisions of sections 225 and 301, nothing in this Act shall  x* be construed to apply, or to give the Commission jurisdiction, with respect to charges, classifications, practices,  x services, facilities, or regulations for or in connection with wire, mobile or pointtopoint radio telephone exchange  xb service, or any combination thereof even though a portion of such exchange service constitutes interstate or foreign  x communication, in any case where such matters are subject to regulation by a State commission or by local governmental authority.").  XJ4 e 24.` ` We provide two further clarifications that follow from the finding that traffic that  xoriginates and terminates within an MTA does not constitute interexchange service. First, we  xclarify that when a customer is roaming, a call within the MTA of the roamed upon CMRS  x~provider is not "interexchange." This clarification ensures that intraMTA calls are not  x"interexchange" service, thus triggering rate integration, regardless of the location of the  xcustomer. Second, we clarify that when a CMRS provider performs only an exchange access  xfunction, and an unaffiliated interexchange carrier transports and bills for the call to a destination  x0in a different state outside the MTA, that exchange access function is not "interstate,  x"interexchange" for purposes of section 254(g). We conclude that this clarification is necessary  xyto ensure that our treatment here is akin to our treatment of incumbent LEC access charges, which are not required to be integrated.  X6' C.XOther Reconsideration Issues (#  X4 e 25.` ` Several CMRS providers seek clarification or reconsideration of the application  xof rate integration to roaming and airtime charges. We plan to seek additional comment on these  xcissues in a Further Notice. Two additional sets of issues remain: (1) the treatment of widearea  xIcalling plans; and, (2) the affiliation requirements applicable to CMRS providers for purposes of  xdetermining compliance with rate integration. We will resolve these issues on the basis of the more complete record developed in response to the Further Notice. "~ @+='='ZZz"Ԍ X' H IV. PETITIONS FOR FORBEARANCE ă  X'  A.XApplicability of Section 254(g) to Interstate, Interexchange Services of CMRS  X'Providers   X4 e ,26.` ` The petitions for forbearance generally request that we forbear from applying the  xrate integration provisions of section 254(g) to interstate, interexchange services offered by  x8CMRS Hproviders, if the Commission concludes that section 254(g) applies to those services.  xcSection 10(a) of the Act sets forth a threepart standard to be applied in addressing petitions for  xforbearance: a carrier may petition the Commission for forbearance from any statutory provision  xor regulation, and the Commission shall grant such petition if it determines that: (1)  x@enforcement of the requirement is not necessary to ensure that rates are just and reasonable, and  xare not unjustly and unreasonably discriminatory; (2) the regulation is not necessary to protect  X 4 xconsumers; and (3) forbearance is consistent with the public interest.nA > yON'#X\  P6G;/P#э47 U.S.C.  160(a).n Section 10 further  xprovides that the Commission "shall consider whether forbearance from enforcing the regulation  xVwill promote competitive market conditions, including the extent to which such forbearance will  X4 xyenhance competition among providers of telecommunications services."nBX> yO'#X\  P6G;/P#э47 U.S.C.  160(b).n As fully discussed  xbelow, we conclude that the petitioners have not met the standard for the grant of forbearance and, for this reason, we must deny their petitions.  X44 e 27.` ` The petitioners generally argue that the requirements of section 10 are satisfied  xbecause competitive conditions in the industry prevent CMRS providers from charging excessive  X4 xrates, or rates that would discriminate.C> {O'#X\  P6G;/P#эSee, e.g., PCIA Petition at 5; CTIA Petition at 9. PCIA, AT&T Wireless, and CTIA argue that the  x_Commission has previously found that competitive forces exist in the CMRS market that are  x+driving down the price of mobile services, and that those findings require the Commission to  X4 xforbear in the present case.Dz> yO'#X\  P6G;/P#эPCIA Petition at 56; AT&T Wireless Comments at 56; CTIA Petition at 10. CMRS rates have declined 64 percent since 1987, according to  X4 xsome CMRS providers.E > yOe '#X\  P6G;/P#эPrimeco Petition at 23; Primeco Reply at 7. CTIA asserts that CMRS providers lack the market power necessary  X4 xto maintain interstate rates above market prices.lF> yO"'#X\  P6G;/P#эCTIA Petition at 11.l Primeco states that a 1996 Yankee Group  xstudy found that PCS rates are 15 to 30 percent lower than rates of incumbent cellular"| * F+='='ZZ"  X4 xproviders.kG> yOy'#X\  P6G;/P#эPrimeco Reply at 7.k Several petitioners argue that regulation will increase prices, reduce consumer  X4choice, and lessen competition.HX> {O'#X\  P6G;/P#эSee, e.g., BellSouth Petition at 15.  X4 e 928.` ` Hawaii and Alaska, on the other hand, oppose granting forbearance. They argue,  xthat, if the Commission forbears from applying the rate integration policy to CMRS providers,  xoffshore points would pay high, discriminatory CMRS rates, in violation of section 254(g).  xHawaii argues that competition cannot be the only factor to be considered in determining whether  X_4 xforbearance is appropriate.pI_> yO '#X\  P6G;/P#эHawaii Opposition at 10.p Alaska argues that by codifying geographic rate averaging and rate  xintegration, Congress recognized that rate integration is a fundamentally important national  xtelecommunications policy necessary to provide consumers in rural and highcost areas access  X 4 xto interexchange services at affordable and nondiscriminatory rates.pJ z> yOE'#X\  P6G;/P#эAlaska Opposition at 12.p Alaska and Hawaii assert  x<that the public interest would not be served by a ruling contrary to the clear language of section 254(g).  X 4 e 29.` ` We conclude that the petitioners have not met their burden with respect to the first  xand second prongs of the forbearance standard. We are concerned that, without rate integration,  x/CMRS providers would, when consistent with their economic interests, discriminate against the  xoffshore points. Our concerns are not eliminated by the CMRS providers' claims that CMRS  xrates are falling, or that PCS rates are lower than cellular rates. Similarly, CMRS providers' few  x cited anecdotal instances of the offering of rates that comply with the rate integration requirement  x+of section 254(g) do not ensure that such rates will be offered by all CMRS providers in the  X4 xRfuture.&K > {O' "c #X\  P6G;/P#эSee Letter from S. Mark Tuller, Vice President Legal and External Affairs, General Counsel and Secretary, Bell Atlantic Mobile, to William E. Kennard, Chairman, FCC, dated Nov. 10, 1998.& Moreover, although CMRS providers contend generally that rate integration would  xinterfere with competition, resulting in less consumer choice, we find no specific persuasive arguments on this record to support those contentions.  X4 e 30.` ` Specifically, we find that the petitioners have not shown that, in the absence of rate  xintegration, CMRS rates will be just and reasonable and not unjustly or unreasonably  x discriminatory. Indeed, we conclude that rate integration is necessary to ensure that  xnondiscriminatory charges and practices are offered with respect to CMRS services to and from  Xe4 xthe offshore points.?Led > {Oz%' " #X\  P6G;/P#эSee also Letter from Senators Ted Stevens and Daniel Inouye, United States Senate, to William E. Kennard,  {OD&'Chairman, FCC, dated Dec. 14, 1998 ("Sens. Stevens and Inouye Ex Parte Letter"). ? Moreover, as noted by Alaska, even if rate integrated service plans are"e L+='='ZZ"  xavailable in all parts of the United States, nothing in the record suggests that the existence of the  X4 xlrate integration requirement is not a significant cause of that condition.M> {Ob'#X\  P6G;/P#эSee Alaska Ex Parte Letter at 5. We also agree that  xthere is no evidence to show that rate integration is not necessary for the protection of  X4 xconsumers.NZ> {O'#X\  P6G;/P#эSee Sens. Stevens and Inouye Ex Parte Letter at 1. Alaska notes, for example, that Bell Atlantic Mobile's argument that consumers  xbenefit from its plan offering one longdistance rate is misplaced because Bell Atlantic Mobile  X4 xdoes not offer service to subscribers in Alaska and Hawaii.O> {OA '#X\  P6G;/P#эSee Alaska Ex Parte Letter at 5. Thus, although the cost to a Bell  xAtlantic Mobile customer calling Alaska or Hawaii might be the same as the cost of a call  xVelsewhere in the continental United States, that fact does not protect the interests of consumers  XH4in Alaska or Hawaii because they generally would not be paying the long distance charges.PH> {O '#X\  P6G;/P#эSee Alaska Ex Parte Letter at 56.  X 4 e 31.` ` We also agree with Hawaii and Alaska that a broad grant of forbearance would  xnot be consistent with the public interest, as required by the third prong of the forbearance  xstandard. The public interest here, as reflected by the inclusion of CMRS providers in section  x 254(g), is the integration of offshore points into the interexchange rate patterns of CMRS services  xto prevent discrimination against those locations. Therefore, in order to satisfy the public interest,  x"CMRS providers must explain how the benefits of section 254(g) can be attained if we forbear  x/from applying the rate integration requirement of section 254(g) to the interstate, interexchange  xservices of CMRS providers. We conclude that the petitioners have not made the required demonstration.  X44 e e32.` ` The argument against forbearance is particularly compelling with respect to  xseparatelystated long distance charges. Many CMRS providers offer service plans that include  xa toll charge assessed for a longdistance call that is separate from the airtime charge. When the  xCMRS provider provides the link to the distant location, either through its own facilities or  x<through the resale of a longdistance provider's service, and bills separately for that service, we  xfind that the CMRS provider is providing an interexchange service. If that call terminates in a  xstate different from the state in which the call originates, the service is an interstate,  X4interexchange service covered by the rate integration requirement of section 254(g).Q"'> {Ok ' " #X\  P6G;/P#эSee, e.g., Hawaii Opposition at 20 (citing The Need to Promote Competition and Efficient Use of Spectrum  x for Radio Common Carrier Services, 59 Rad. Reg. 2d (P&F) 1275 at App.B n.3 (1986) (Commission determined in  x 1986 that a cellular carrier would be an interexchange carrier if it provides interstate interexchange service)); Alaska Opposition at 17.  Xe4 e B 33.` ` We conclude that it would not be consistent with just and reasonable rates, the  x8protection of consumers, and the public interest to forbear from applying the rate integration  xrequirement of section 254(g) to separatelystated toll charges for interstate, interexchange"7 Q+='='ZZ"  xservices provided by CMRS providers. For separately stated CMRS toll charges, we do not see  xhow the policy considerations regarding rate integration differ materially from those in the non x/CMRS context. Applying rate integration of separatelystated toll charges appears to be at the  xcheart of the congressional policy of section 254(g)), which was enacted despite the existence of multiple interexchange carriers.  Xv4 e !34.` ` Pursuant to section 160(b),nRv> yO'#X\  P6G;/P#э47 U.S.C.  160(b).n we also have considered whether forbearance from  xRenforcing the rate integration requirement of section 254(g) will promote competitive market  x4conditions. Although CMRS providers contend that rate integration would interfere with  xcompetition, we find no persuasive record evidence to support that contention or, conversely, that  xVcompetitive conditions will be promoted in the absence of rate integration. Moreover, we agree  X 4 xthat forbearance from rate integration cannot be justified on competitive conditions alone.sS X> yO '#X\  P6G;/P#эHawaii Opposition at 1012.s  X 4 xHawaii correctly notes we have previously rejected this argument.T > {O'#X\  P6G;/P#эRate Integration Order, 11 FCC Rcd at 958889. Prior to the enactment of  x8section 254(g), we already had determined that all IXCs were nondominant in the domestic  xmarket and had found that most major segments of the interexchange market were subject to  X 4 xsubstantial competition.U z> {O' "y #X\  P6G;/P#эSee, e.g., Motion of AT&T Corp. to be Reclassified as a NonDominant Carrier, 11 FCC Rcd 3271, 3288 (1995). Nothing suggests that Congress was unaware of the state of  xAcompetition in the interexchange market in enacting section 254(g). Indeed, we find that  xCongress's enactment of section 254(g), even after the Commission's determination that major  xsegments of the interexchange market were subject to substantial competition, establishes the  x<importance Congress placed on a nationwide policy of rate integration that was applicable to all  X44providers of interstate, interexchange services.{VZ4> {O' "u #X\  P6G;/P#эSee Sens. Stevens and Inouye Ex Parte Letter at 1 (forbearance from applying section 254(g)'s rate  x integration requirement to CMRS would "send the wrong signal about the importance of the statutory rate integration requirement established by Congress").{  X4 e "35.` ` Contrary to the assertions of several CMRS providers,W > {O '#X\  P6G;/P#эSee, e.g., Bell Atlantic Petition at 17; Primeco Petition at 15; Primeco Reply at 8. our finding in the CMRS  X4 xForbearance OrderX > {O*#'#X\  P6G;/P#эCMRS Forbearance Order, 9 FCC Rcd 1411., that there was sufficient competition in the CMRS market to justify  X4 xforbearance from, inter alia, the tariffing requirements of section 203205, do not require  X4 xgforbearance with respect to section 254(g). The CMRS Forbearance Order, adopted pursuant to  xysection 332, primarily addressed the tariff filing requirement and its competitive implications. "X+='='ZZ"  x3The rate integration requirement of section 254(g) creates a substantive pricing requirement which  xraises different competitive considerations than do tariff requirements. Moreover, section 332(c),  xby its terms, prohibits forbearance from application of section 202(a) to the CMRS industry. We  xnote that 254(g) has its origins in section 202(a). Accordingly, we find that our forbearance in the tariffing context has no relevance to the question of forbearance here.  Xv4 e #36.` ` In sum, we conclude that the petitioners have not demonstrated that forbearance  xfrom applying the rate integration requirements of section 254(g) is consistent with just and  xNreasonable or not unjustly or unreasonably discriminatory rates in the CMRS context, the  x/protection of consumers, and the public interest. Similarly, we have not found that forbearance  xlfrom enforcing the rate integration requirement of section 254(g) would promote competitive  xmarket conditions. Accordingly, we cannot grant the forbearance requests. In a separate  x<proceeding, we will seek further comment on ways in which the rate integration requirement of  x"section 254(g) should be applied to CMRS offerings. The expanded record evidence about the  xnature of CMRS services and the ownership arrangements within the industry will permit us to  xmore fully evaluate rate integration in the CMRS context, develop rules specific to CMRS services, or, if appropriate, forbear in some instances.  Xb' B.XOther Forbearance Issues (#  X44 e $37.` ` The forbearance petitions generally sought forbearance from the application of rate  x8integration to all interstate, interexchange services offered by CMRS providers. In addition,  xseveral CMRS providers argue that, if we do not forbear totally from applying rate integration  x"to interstate, interexchange offerings of CMRS providers, we should apply rate integration only  X4 xto services for which the longdistance charges are separately billed.pY> yOQ'#X\  P6G;/P#эAirTouch Petition at 12.p We conclude that the  xpresent record does not establish that the forbearance standard of section 10 of the Act has been  x_met with respect to this matter. For example, the record does not establish that forbearance  xwould be consistent with the public interest. In addition, the record does not provide sufficient  xinformation to determine whether certain types of airtime or roaming charges, or some widearea  xcalling plans, fall within the definition of interexchange services to which rate integration would  xapply; and, how different affiliation requirements would affect the CMRS industry. We seek  xcomment on these issues in a separate rulemaking proceeding that will permit us to develop rules  xspecific to CMRS services. Accordingly, we deny the remaining requests of the petitions for  xforbearance as inconsistent with just and reasonable rates or not unjustly or reasonably discriminatory rates; the protection of consumers; and the public interest.  X 46% V. ORDERING CLAUSES ă  X"4 e %38.` ` Accordingly, IT IS ORDERED, that the Petitions for Reconsideration filed by  xAirTouch Communications, Cellular Telecommunications Industry Association, PrimeCo Personal"#XY+='='ZZ!"  x_Communications, L.P., Personal Communications Industry Association, Telephone and Data  X4 xSystems, Inc., BellSouth Corporation, and Bell Atlantic Mobile, Inc. ARE DENIED TO THE EXTENT INDICATED HEREIN.  X4 e &39.` ` IT IS FURTHER ORDERED that the Petitions for Forbearance filed by AirTouch  xCommunications, Cellular Telecommunications Industry Association, PrimeCo Personal  x_Communications, L.P., Personal Communications Industry Association, Telephone and Data  X_4Systems, Inc., BellSouth Corporation, and Bell Atlantic Mobile, Inc. ARE DENIED.  X14 e 5'40.` ` IT IS FURTHER ORDERED that the Commission's Office of Public Affairs,  xReference Operations Division, SHALL SEND a copy of this Memorandum Opinion and Order,  x4including the Supplemental Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration. ` `  ` `  hhCFEDERAL COMMUNICATIONS COMMISSION ` `  hhCMagalie Roman Salas ` `  hhCSecretary"4Y+='='ZZD"  X' UAPPENDIX A ă  X' Petitions for Reconsideration, or,  X'In the Alternative, Petitions for Forbearance AirTouch Communications ("AirTouch") Bell Atlantic Mobile, Inc. ("Bell Atlantic Mobile") BellSouth Corporation ("BellSouth") Cellular Telecommunications Industry Association ("CTIA") PrimeCo Personal Communications, L.P. ("Primeco") Personal Communications Industry Association ("PCIA") Telephone and Data Systems, Inc. ("TDS")  X ' Comments/Oppositions AT&T Wireless Services, Inc. ("AT&T Wireless") Comcast Cellular Communications, Inc. ("Comcast") State of Alaska ("Alaska") State of Hawaii ("Hawaii") U S West, Inc. ("U S West")  X' Reply Comments AirTouch BellSouth CTIA Centennial Cellular Corp. ("Centennial") Commonwealth of the Northern Mariana Islands ("Commonwealth") PrimeCo Southwestern Bell Mobile Systems, Inc. U S West"NY+='='ZZ"  X' UAPPENDIX B ă  X' Supplemental Final Regulatory Flexibility Act Analysis ă   X4 e (41.` ` As required by the Regulatory Flexibility Act (RFA),pZZ> {O' " #X\  P6G;/P#эSee 5 U.S.C.  603. The Contract With America Advancement Act of 1996, Pub. L. No. 104- 121, 110  x Stat. 847 (1996) (CWAAA), amended the RFA. Title II of the CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).p the Commission  X4 xincorporated an Initial Regulatory Flexibility Analysis (IRFA) in the Further Notice in this  Xx4 xdocket.[x> {O '#X\  P6G;/P#эSee Further Notice, 11 FCC Rcd at 719293. The Commission sought written public comment on the proposals in the Further  Xc4 xNotice, including comment on the IRFA. The Commission prepared a Final Regulatory  XN4 xFlexibility Analysis (FRFA) of the possible significant economic impact the Rate Integration  X94 x Order might have on small entities.t\9|> {Of'#X\  P6G;/P#эSee 5 U.S.C.  604.t The FRFA did not, however, analyze the possible  X$ 4 xsignificant economic impact the Rate Integration Order might have on CMRS providers that were  X 4 xsmall entities.y] > {O'#X\  P6G;/P#эSee, para. 21, supra.y The Commission has prepared this supplemental FRFA of the possible  X 4 xsignificant economic impact the Rate Integration Order might have on CMRS providers that are  X 4small entities, in conformance with the RFA.t^ > {O4'#X\  P6G;/P#эSee 5 U.S.C.  604.t  W 4  W 4A.Need for and Objectives of Rules  X4 e S)42.` ` In the 1996 Act, Congress directed the Commission to develop rules implementing  xthe provisions of section 254(g) within six months of its enactment. The Commission adopted  XY4 xrules implementing the provisions of section 254(g) in the Rate Integration Order. The objective  xof these rules is to incorporate the policies of geographic rate averaging and rate integration of  xinterexchange services in order to ensure that subscribers in rural and high cost areas throughout  xthe Nation are able to continue to receive both intrastate and interstate interexchange services at rates no higher than those paid by urban subscribers.  V4  W4 B.XSummary of Significant Issues Raised by the Public Comments to the IRFA (#  X4 e *43.` ` The IRFA solicited comment on alternatives to our proposed rules that would  xminimize the impact on small entities consistent with the objectives of this proceeding. No  x+comments were submitted directly in response to the IRFA. We have, however, kept small"u2 ^+='='ZZ"  x'entities in mind as we considered the more general comments filed in this proceeding, as discussed below.  W4  C.XDescription and Estimate of Number of Small Entities to Which the Rules Will  W4Apply   Xv4 e +44.` ` The RFA directs agencies to provide a description of and, where feasible, an  X_4 xestimate of the number of small entities that may be affected by the proposed rules, if adopted.q__> yO'#]\  PC/P#э5 U.S.C.  603(b)(3). q  xyThe RFA generally defines the term "small entity " as having the same meaning as the terms  X14 x"small business," "small organization," and "small governmental jurisdiction."t`1X> {O: '#]\  PC/P#эId.  601(6). t In addition, the  x+term "small business" has the same meaning as the term "small business concern" under the  X 4 x/Small Business Act.a > yO' " #]\  PC/P#э5 U.S.C.  601(3) (incorporating by reference the definition of "small business concern" in 15 U.S.C. 632).  x Pursuant to the RFA, the statutory definition of a small business applies "unless an agency, after consultation with  x! the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes  xZ 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). A small business concern is one which: (1) is independently owned and  xoperated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria  X 4established by the Small Business Administration (SBA). b > yO '#]\  PC/P#эSmall Business Act, 15 U.S.C.  632 (1996).  X 4(a)` ` Cellular Radio Telephone Service(#`  Xy4 e X` hp x (#%'0*,.8135@8: yO'#X\  P6G;/P#э13 C.F.R.  121.201, Standard Industrial Classification (SIC) Code 4812. According to the 1992  xcensus, which is the most recent information available, only 12 radiotelephone firms out of a total  X4 xof 1,178 such firms which operated during 1992 had 1,000 or more employees.odX > yOq!' "F #X\  P6G;/P#эU.S. Bureau of the Census, U.S. Department of Commerce, 1992 Census of Transportation,  x* Communications, and Utilities, UC92-S-1, Subject Series, Establishment and Firm Size, Table 5, Employment Size of Firms: 1992, SIC Code 4812 (issued May 1995).o #Xj\  P6G;XP#Therefore,  x"even if all 12 of these large firms were cellular telephone companies, all of the remainder were  X4 xsmall businesses under the SBA's definition#Xj\  P6G;XP#. We assume that, for purposes of our evaluations  xand conclusions in this Supplemental FRFA, all of the current cellular licensees are small entities,"d+='='ZZ"  xIas that term is defined by the SBA. Although there are 1,758 cellular licenses, we do not know the number of cellular licensees, since a cellular licensee may own several licenses.  X4(b)` ` Broadband Personal Communications Service(#`  X4 e X` hp x (#%'0*,.8135@8: yO'#X\  P6G;/P#э47 C.F.R.  24.720(b).q the Commission has  xhdefined ``small entity'' for Block C and Block F licensees as firms that had average gross  xrevenues of less than $40 million in the three previous calendar years. This regulation defining  X14``small entity'' in the context of broadband PCS auctions has been approved by the SBA.*f1X> {O: ' " #X\  P6G;/P#эSee Implementation of Section 309(j) of the Communications Act " Competitive Bidding, PP Docket No.  {O '93253, Fifth Report and Order, 9 FCC Rcd 5532, 558184 (1994).*  X 4 e .47.` ` The Commission has auctioned broadband PCS licenses in all of its spectrum  xblocks A through F. We do not have sufficient data to determine how many small businesses  xunder the Commission's definition bid successfully for licenses in Blocks A and B. As of now,  xthere are 90 nondefaulting winning bidders that qualify as small entities in the Block C auction  xand 93 nondefaulting winning bidders that qualify as small entities in the D, E, and F Block  x/auctions. Based on this information, we conclude that the number of broadband PCS licensees  xthat would be affected by the evaluations and conclusions in this Supplemental FRFA includes  xthe 183 nondefaulting winning bidders that qualify as small entities in the C, D, E, and F Block broadband PCS auctions.  X4(c)` ` Specialized Mobile Radio(#`  X4 e X` hp x (#%'0*,.8135@8: yOT'#X\  P6G;/P#э47 C.F.R.  90.814(b)(1).t the Commission  xhas defined ``small entity'' for geographic area 800 MHz and 900 MHz SMR licenses as firms  xthat had average gross revenues of no more than $15 million in the three previous calendar years.  xThis regulation defining ``small entity'' in the context of 800 MHz and 900 MHz SMR has been  X4approved by the SBA.phHD> {O ' " #X\  P6G;/P#эSee Amendment of Parts 2 and 90 of the Commission's Rules to Provide for the Use of 200 Channels  x* Outside the Designated Filing Areas in the 896901 MHz and the 935940 MHz Bands Allotted to the Specialized  {O"' x^ Mobile Radio Pool, PR Docket No. 89553, Second Order on Reconsideration and Seventh Report and Order, 11  x FCC Rcd 2639, 2693702 (1995); Amendment of Part 90 of the Commission's Rules to Facilitate Future Development  x of SMR Systems in the 800 MHz Frequency Band, PR Docket No. 93144, Implementation of Sections 3(n) and 322  x7 of the Communications Act " Regulatory Treatment of Mobile Services, GN Docket No. 93252, Implementation  {O<%' xg of Section 309(j) of the Communications Act " Competitive Bidding, PP Docket No. 93253, First Report and  {O&'Order, Eighth Report and Order, and Second Further Notice of Proposed Rulemaking, 11 FCC Rcd 1463 (1995).p"T h+='='ZZ"Ԍ X4 e Fԙ049.` ` The section 254(g) requirements apply to SMR providers in the 800 MHz and 900  xMHz bands. We do not know how many firms provide 800 MHz or 900 MHz geographic area SMR service, nor how many of these providers have annual revenues no more than $15 million.  X4 e O150.` ` The Commission recently held auctions for geographic area licenses in the 900  xMHz SMR band. There were 60 winning bidders who qualified as small entities under the  xCommission's definition in the 900 MHz auction. Based on this information, we conclude that  xthe number of geographic area SMR licensees affected by section 254(g) includes these 60 small entities.  X 4 e `251.` ` A total of 525 licenses were auctioned for the upper 200 channels in the 800 MHz  xgeographic area SMR auction. There were 62 qualifying bidders, of which 52 were small  xbusinesses. The Commission has not yet determined how many licenses will be awarded for the  xlower 230 channels in the 800 MHz geographic area SMR auction. There is no basis to estimate,  xmoreover, how many small entities within the SBA's definition will win these lower channel  xhlicenses. Given the facts that nearly all radiotelephone companies have fewer than 1,000  x"employees and that no reliable estimate of the number of prospective 800 MHz SMR licensees  xcan be made, we assume, for purposes of our evaluations and conclusions in this Supplemental  xFRFA, that all of the licenses for the lower 230 channels will be awarded to small entities, as that term is defined by the SBA.  X4(d)` ` 220 MHz Service(#`  X4 e BX` hp x (#%'0*,.8135@8: yO '#X\  P6G;/P#э13 C.F.R.  121.201, SIC Code 4812. According to the 1992  x`Census, which is the most recent information available, only 12 out of a total 1,178  xradiotelephone firms which operated during 1992 had 1,000 or more employees " and these may  xor may not be small entities, depending on whether they employed more or less than 1,500" Xi+='='ZZ;"  X4 xemployees.pjX> yOy' "F #X\  P6G;/P#эU.S. Bureau of the Census, U.S. Department of Commerce, 1992 Census of Transportation,  x Communications, and Utilities, UC92S1, Subject Series, Establishment and Firm Size, Table 5, Employment Size of Firms; 1992, SIC Code 4812 (issued May 1995). p But 1,166 radiotelephone firms had fewer than 1,000 employees and therefore,  xunder the SBA definition, are small entities. However, we do not know how many of these 1,166 firms are likely to be involved in the phase I 220 MHz service.  X4(e)` ` Mobile Satellite Services (MSS) (#`  Xv4 e X` hp x (#%'0*,.8135@8: yO'#X\  P6G;/P#э13 C.F.R.  120.121, SIC Code 4899.  According to the Census Bureau, there were a total of 848 communications  xservices, NEC in operation in 1992, and a total of 775 had annual receipts of less than $9.999  X 4million.4l x> yO' "_ #X\  P6G;/P#э1992 Economic Census Industry and Enterprise Receipts Size Report, Table 2D, SIC 4899 (U.S. Bureau of the Census data under contract to the Office of Advocacy of the U.S. Small Business Administration).4  X 4 e `655.` ` Mobile Satellite Services or Mobile Satellite Earth Stations are intended to be used  xwhile in motion or during halts at unspecified points. These stations operate as part of a network  xuthat includes a fixed hub or stations. The stations that are capable of transmitting while a  Xy4 xplatform is moving are included under Section 20.7(c) of the Commission's Rulesomy> yO'#X\  P6G;/P#э47 C.F.R.  20.7(c).o as mobile  Xb4 xservices within the meaning of Sections 3(27) and 332 of the Communications Act.xnb` > yOs'#X\  P6G;/P#э47 U.S.C.  153(27), 332.x Those  xpMSS services are treated as CMRS if they connect to the Public Switched Network (PSN) and  xalso satisfy other criteria of Section 332. Facilities provided through a transportable platform that  X4cannot move when the communications service is offered are excluded from Section 20.7(c).oo > yO'#X\  P6G;/P#э47 C.F.R.  20.7(c).o  X4 e z756.` ` The MSS networks may provide a variety of land, maritime and aeronautical voice  x and data services. There are eight mobile satellite licensees. At this time, we are unable to make  xa precise estimate of the number of small businesses that are mobile satellite earth station licensees. " o+='='ZZ9"Ԍ X4(f)` ` Paging Service(#`  X4 e rX` hp x (#%'0*,.8135@8: {O'#X\  P6G;/P#эSee id.e  X 4(h)` ` AirGround Radiotelephone Service  X4 e SX` hp x (#%'0*,.8135@8: yO$'#X\  P6G;/P#э47 C.F.R.  22.99.m  X!4 xAccordingly, we will use the SBA's definition applicable to radiotelephone companies, i.e., an"!q+='='ZZ? "  X4 xentity employing no more than 1,500 persons.yr> yOy'#X\  P6G;/P#э13 C.F.R.  121.201, SIC 4812.y There are approximately 100 licensees in the  xlAirGround Radiotelephone Service, and we estimate that almost all of them qualify as small under the SBA definition.   W4 " D.XDescription of Projected Reporting, Recordkeeping, and Other Compliance  W4Requirements (#  X`4 e <61.` ` In the Rate Integration Order, and the Rate Integration Reconsideration Order, we  xdetermined that section 254(g) applied to interstate, interexchange services offered by CMRS  xproviders. We expect that those orders impose no significant new reporting or recordkeeping  x<requirements on CMRS providers. Those orders, however, require CMRS providers to comply  x[with the rate averaging and rate integration requirement of section 254(g) in their service offerings. CMRS providers, however, do not file tariffs except on some international routes.  W 4 "I E.XSteps Taken to Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered(#  X4   X|4 e =62.` ` Section 254(g) reflects a congressional determination that the country's highercost,  x_lowervolume markets should share in the technological advances and increased competition  x&characteristic of the nation's telecommunications industry as a whole, and that interexchange rates  xshould be provided throughout the nation on a geographically averaged and rate integrated basis.  xWe have decided that the statutory objectives of section 254(g) require us to apply our rules to  xall providers of interexchange service, including small ones. We have chosen, however, to allow  xcarriers to offer private line service and temporary promotions on a de-averaged basis. In so  xVdoing, we have minimized the impact our rules might otherwise have had, and enable carriers to use such devices to enter new markets.  X4 e >63.` ` In addition, the Commission considered reducing the burdens on small carriers by  xuexempting them from compliance through forbearance. However, we do not believe that  xyforbearing at this time would be consistent with the Congressional goals that underlie Section  x254(g). We could also have reduced burdens on small carriers by establishing costsupport  xImechanisms. However, the present record does not justify any such costsupport mechanisms. Accordingly, we decline to adopt these alternative measures for small carriers.   W4 F.` ` Report to Congress  X 4 e ?64.` ` The Commission will send a copy of this order, including the supplemental FRFA,  xin a report to be sent to Congress pursuant to the Small Business Regulatory Enforcement"!Xr+='='ZZY "  X4 xFairness Act of 1996.~s> {Oy'#X\  P6G;/P#эSee 5 U.S.C.  801 (a)(1)(A).~ A summary of this Memorandum Opinion and Order and this  X4 xSupplemental FRFA will also be published in the Federal Register,wtZ> {O'#X\  P6G;/P#эSee 5 U.S.C.  604(b).w and will be sent to the  X4Chief Counsel for Advocacy of the Small Business Administration.