Mobile Technologies

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					 Mobile Technologies

NARUC Telecommunications Committee

        Wireless Workgroup

          February 2007
                                                       TABLE OF CONTENTS

I.        INTRODUCTION ....................................................................................................................... 1

II.          WHAT “WIRELESS” MEANS – VOICE & BEYOND ............................................................. 2
     A.      Wireless Voice Technology ................................................................................................. 3
     B.     Wireless Technologies Broader in Scope than Voice Technologies................................... 3
          1. Wireless Broadband ........................................................................................................ 3
          2. Wi-Fi ............................................................................................................................... 3
          3. WiMAX .......................................................................................................................... 4
          4. Wireless Local Area Networks (LANs).......................................................................... 4
          5. EV-DO ............................................................................................................................ 5
          6. Ultra wideband................................................................................................................ 5
          7. Bluetooth......................................................................................................................... 5
          8. GPS ................................................................................................................................. 6
          9. RFID ............................................................................................................................... 6
          10.   Biometrics ................................................................................................................... 6
          11.   3G Technology............................................................................................................ 7
          12.   Higher Speeds & Mobile Broadband Services ........................................................... 7
     C.      Data Applications ............................................................................................................... 7
     D.     Convergence of Wireless Device Functionality.................................................................. 9
          1. Cellular Phones ............................................................................................................... 9
          2. Smartphones.................................................................................................................... 9
          3. Wireless E-mail Devices............................................................................................... 10
          4. Pocket PCs/PDAs.......................................................................................................... 10
          5. Laptop Computers......................................................................................................... 11
          6. Bluetooth Devices......................................................................................................... 11
          7. Digital Cameras ............................................................................................................ 12
          8. M-Commerce – Major component of Wireless Sector ................................................. 12

     A.     Consumer and Societal Interests and Challenges ............................................................ 14
          1. Current FCC Data Regarding Extent of Wireless Industry Competition ..................... 14
          2. Consumer and Societal Benefits ................................................................................... 15
            a. Improved Communication ........................................................................................ 15
            b. Education .................................................................................................................. 15
            c. Rural Consumers....................................................................................................... 16
            d. Business Consumers ................................................................................................. 17
            e. Special Needs Consumers......................................................................................... 17
            f. Improved Healthcare – Telemedicine....................................................................... 19
            g. Disaster Relief........................................................................................................... 20
            h. National Security ...................................................................................................... 21
            i. Personal Security ...................................................................................................... 21
            j. Anti-theft Measures .................................................................................................. 22
     B.      Economic Interests............................................................................................................ 22

     C.        Wireless Challenges.......................................................................................................... 23
          1.     Voluntary Consumer Code ........................................................................................... 24
          2.     Assurance of Voluntary Compliance ............................................................................ 25
          3.     Cooperative Agreements............................................................................................... 25
          4.     State Actions ................................................................................................................. 25
          5.     Court Decisions............................................................................................................. 26
          6.     Conclusion .................................................................................................................. 267

IV.            WHAT “WIRELESS” MEANS: SELECT CURRENT POLICY ISSUES .................................. 27
     A.        Consumer Protection Issues ............................................................................................. 27
     B.     Wireless ETC Issues.......................................................................................................... 28
          1. ETC Background .......................................................................................................... 28
          2. FCC Report and Order released March 17, 2005 ......................................................... 29
     C.        Interconnection Issues ...................................................................................................... 30
     D.        Public Safety & E-911 ...................................................................................................... 31
          1.     FCC Wireless 911 Initiatives ........................................................................................ 31
     E.        Universal Service and Intercarrier Compensation........................................................... 33

V.        STATE BEST PRACTICES AND PROACTIVE APPROACHES ................................................... 33
     A.        Overview ........................................................................................................................... 33
     B.        Sample State Best Practices.............................................................................................. 34
          1.     Communicating with Consumers.................................................................................. 34
          2.     Establishing Dialogue with Providers........................................................................... 34
          3.     Building Expertise within Commission ........................................................................ 34
          4.     Resolving Consumer Contacts...................................................................................... 35
          5.     Fostering Cooperation Among Interested Parties ......................................................... 35
     C.     State Case Studies ............................................................................................................. 36
          1. Arizona.......................................................................................................................... 36
          2. California ...................................................................................................................... 36
          3. Florida ........................................................................................................................... 37
          4. Iowa............................................................................................................................... 39
          5. Nebraska ....................................................................................................................... 39
          6. New York...................................................................................................................... 39
          7. North Carolina .............................................................................................................. 40
          8. North Dakota................................................................................................................. 41
          9. South Dakota................................................................................................................. 42
          10. Tennessee...................................................................................................................... 42
          11. Texas ............................................................................................................................. 44
          12. Virginia ......................................................................................................................... 44

                                                                         - ii -

        For approximately 228 million Americans,1 wireless telecommunications is a means by
which they place and receive voice communications free of cables or cords and without being
confined to any one location. However, the wireless voice sector is not comprised only of
cellular and personal communications service (PCS) voice services. In fact, the wireless sector
encompasses a whole host of products and services in addition to voice, such as innovative
broadband technologies like world interoperability for microwave access (WiMAX).

        Today, wireless services are prevalent in almost every aspect of our society. Such
ubiquity raises many public policy issues that the wireless industry may have to address. The
FCC regulates the entry of wireless voice providers and has essentially deregulated rates given
the high level of competition in wireless. State utility agencies regulate the terms and conditions
of service, if allowed by state law and policy. State utility agencies are generally concerned with
how the wireless voice service impacts certain social issues, such as E-911, universal service,
access charges, and consumer affairs. The growing importance of wireless communications
combined with the regulators’ need to continually assess the public policy impact of what is
regulated and why it is, is what gave rise to this paper. Therefore, this paper’s objectives are:

       •       To explore the value that consumers place on their wireless devices through an
               overview of the wireless sector’s impact beyond voice services, its economic
               importance and value to consumers, and its capacity for enhancing the
               deployment of broadband technologies.

       •       To discuss those policy issues for which regulators have concerns, such as
               consumer service, access and benefits, and public safety.

       •       To assess wireless regulation in light of the principles adopted by NARUC in its
               Telecom and Federalism White Paper, adopted July 2005 – technological
               neutrality and core competencies of levels of government.

       •       To enhance NARUC’s proactive public policy advocacy and highlight States’ best
               practices and approaches.

       •       To carefully consider the implications of regulation; specifically, to demonstrate a
               balanced approach to the regulation of key wireless voice issues.

       •       To encourage proactive regulatory approaches which benefit the consumer’s
               experience by facilitating wireless investment.

       •       To discuss non-regulatory solutions which offer reasonable perspectives in the
               federal policy debate and focus attention on important public policy issues.

       Overview of White Paper

       This white paper addresses some key topics for regulators to consider regarding wireless
communications: What is meant by “wireless”; what are the implications for consumers and the
economy; what current policy issues are being debated; and, what are some of the proactive
approaches states are taking with respect to wireless issues. The paper contains the following

       Section II:    What “Wireless” Means – Voice & Beyond - This section highlights a
                      number of wireless technologies and applications that reach beyond
                      cellular voice service. This section also explores the convergence of
                      wireless device functionality. These concepts are important to understand
                      because regulators must comprehend the structure and development of the
                      industry in order to ensure that regulations are structured to benefit
                      consumers and encourage continued investment and innovation by
                      providers. It will be shown that the current market evinces a robust
                      competitiveness among these technologies and services.

       Section III:   What “Wireless” Means – Consumer and Economic Interests and
                      Challenges - This section explores a range of consumer and societal
                      interests and challenges in wireless technologies. This section also
                      provides a brief overview of the economic impact of the wireless sector.

       Section IV:    What “Wireless” Means –Select Policy Issues - This section identifies
                      current policy issues relating to wireless products and services, and
                      describes how different regulatory agencies – the FCC, states, etc. – have

       Section V:     State Best Practices and Proactive Approaches - This section discusses
                      various State approaches with respect to wireless services. The paper
                      explores certain State practices that NARUC believes most effectively
                      furthers the goals of protecting the consumer and providing for the public


        Despite the overwhelming popularity of the cell phone and its entry into the
communications sector as a voice device, “wireless” encompasses a great deal more than just the
cell phone. Wireless includes promising wireless broadband technologies such as wireless
fidelity (Wi-Fi), WiMAX, and next generation cellular networks along with a host of data
applications (whether on a cell phone or some other standalone wireless device, such as a
personal digital assistant (PDA)), including instant messaging, e-mail, games, music, ring tones,
scrolling stock quotes, news, etc.

       The following subsections discuss traditional wireless technology as well as numerous
technologies and applications that reach beyond traditional voice applications.

       A.      Wireless Voice Technology

        Wireless phones transmit telephone calls via a system of radio waves and towers or
antennas.2 Because radio waves travel though the air and can be interrupted by any number of
factors, including weather, topography and manmade infrastructure, wireless phone service can
be less reliable than traditional landline service at times.3

        While coverage is expanding, the ability to place or complete a call may be implicated by
limitations inherent in the existing wireless network’s architecture. For example, the location of
antennas, the number of callers using the airwaves and/or antenna at a given time, topography,
and the architecture surrounding the caller can affect the ability to place a call.4 “Dropped calls”
usually occur when there are too few (or no) cell antennas in the area where the caller is located.5
When many consumers use a carrier’s network at the same time, the network’s capacity may be
strained and a “busy signal” will result instead of call completion.6 “Dead spots” result when the
signal between the handset and the cell tower is blocked, usually by hilly terrain, excessive
foliage or tall buildings.

       B.      Wireless Technologies Broader in Scope than Voice Technologies

               1.         Wireless Broadband

        Wireless broadband is an increasing market segment.7 The FCC defines broadband
service as data transmission speeds exceeding 200 kilobits per second (Kbps), or 200,000 bits per
second, in at least one direction. Users may use wireless PDAs to access the Internet, receive
and send email, download video and music, and more. It has been predicted that “[o]ver half of
the population of North America will use wireless networking that’s not cellular by 2011.”8 It
therefore appears that wireless providers have the potential to become viable competitors in the
broadband market and offer a vehicle for reaching areas not yet served by wire line broadband.
In 2004, approximately 1.6 million U.S. homes subscribed to wireless broadband.9 Though cable
modem and DSL dominated the home broadband market that same year with a combined 46
million subscribers,10 wireless broadband can offer the unique advantage of mobility.11 Wireless
services often times are more cost effective and efficient way to provide services to rural and
sparsely populated areas.

               2.      Wi-Fi

        Wi-Fi is “a form of wireless broadband technology that involves multiple antennae that
send parallel streams of data.”12 Wi-Fi is a registered trademark term promoted by the Wi-Fi
Alliance, a group of wireless Internet hardware and software providers that certify “802.11”
products for network interoperability.13 Wi-Fi is currently deployed in buildings, such as homes,
restaurants, hotels, and airports, or open locations, such as city parks and university campuses,
but has the capacity to evolve into “go-anywhere, connect-anywhere” type of networking.14 As a
result of Wi-Fi’s MIMO (multiple-input, multiple output) technology, Wi-Fi’s bandwidth has
increased from 54 Mbps to 108 Mbps and is predicted to ultimately reach 500 Mbps.15 However,
computer users can only access the Internet with a Wi-Fi high-speed wireless connection if the
are within 300 feet of a transmitting antenna and have the appropriate receiving hardware
installed in their computers.16

        Wi-Fi networks can be set up by installing multiple toaster-size antennas on street lights,
traffic signals, and buildings, so that multiple wireless hotspots overlap each other to form a
continuous “mesh” network of wireless signals.17 In order to provide an initial connection to the
Internet and to manage network traffic, backbone technology must be installed at one or more
points connected to the network.18 The installation of such a wireless network may be less
expensive than installing a wireline network of the same size.19 To this end, a growing number
of municipalities are currently experimenting with citywide Wi-Fi systems that will either
supplement existing wired networks or provide service to the underserved. But, as the Federal
Trade Commission (FTC) has noted, whether the long-term operating costs of such a wireless
network are more or less than those of a comparable wireline network is not clear at this point.20

        Spectrum used for Wi-Fi does not require a license in the U.S. while the spectrum used
for licensed wireless service is sold at auction.21 As of January 21, 2006, there were 6,515 hot
spots in North America and 14,017 hot spots worldwide.22 Market research firm, Del’Oro
Group, estimated that sales of Wi-Fi gear increased by 16% to $2.64 billion in 2005.23 Yet while
Wi-Fi addresses broadband access in popular public locations, it does not provide true
widespread mobility.24

               3.     WiMAX

       WiMAX is another promising wireless broadband technology.25 It offers mobility over a
“hot zone,” a much larger area (up to a four-to-six mile range26) than is covered by a Wi-Fi
deployment,27 peak speeds of 20 Mbps,28 and is relatively cost-effective. In the words of Intel’s
James A. Johnson, “WiMAX is very cost effective technology to quickly deploy in the regions
which otherwise would not have broadband access. So WiMAX helps spread broadband to more
users more quickly.”29

        With Nokia and Intel’s latest announcement of plans to make WiMAX a new standard,30
expansion of the technology appears to be likely. Intel’s backing, in fact, prompted the statement
that “broadband wireless looks like it might bust out of its niche and become something of a rival
to cellular, cable and phone networks.”31 Perhaps most notably, in 2006 Sprint-Nextel
announced that it plans to spend as much as $3 billion through 2008 building a WiMAX
network.32 Though WiMAX may face some difficulty with the video portion of the voice, video,
and data “triple play,” some predict that partnerships among satellite, wireless and wired services
will likely address such drawbacks.33

               4.     Wireless Local Area Networks (LANs)

        A wireless local area network (LAN) is a type of local-area network that uses high-
frequency radio waves rather than wires to communicate between nodes.34 Each node, which
may be a personal computer, workstation or printer, has its own central processing unit (CPU)
which it uses to execute programs, but it can also remotely access data and other devices
anywhere on the LAN.35 This allows multiple users to share expensive devices (such as laser
printers), access data from remote locations, and communicate with each other by exchanging e-
mail.36 LANs are only able to encompass relatively small areas, and most are confined to a
single building or group of buildings.37 Forrester Research recently found that 25% of
businesses in North America and Europe are deploying, or considering deploying, wireless local
area networks (LANs).38
               5.      EV-DO

        EVDO, which stands for Evolution Data Only or Evolution Data Optimized EV-DO,
EvDO, 1xEV-DO or 1xEvDO, is fast wireless broadband access that does not require access to a
WiFi hotspot.39 EVDO networks can be accessed with EVDO capable phones or by inserting an
EVDO PC card into your laptop, which provides a wireless connection to the Internet at very fast
speeds; average download speeds are between 400Kbps and 700Kbps.40 EVDO has many
advantages. EVDO’s signal can travel on the same cellular sites as cellular phones, there is no
limited range from the cell tower or “hot spot” that must be accessed, users can gain access
anywhere they can locate a secure, encrypted cellular signal, users can download and run video
clips in real time, and EVDO can provide service to customers that are outside of traditional
cable-modem or DSL areas.41

         Verizon EVDO and Sprint EVDO are currently available.42 Verizon has indicated that it
will invest $1 billion in EVDO over the next two years.43 At speeds of about 10 times the
average dial-up speed (or 300-500 Kbps), Verizon’s EV-DO offering is being marketed at a flat
rate to consumers and businesses in certain markets.44

               6.      Ultra wideband

        Ultra wideband (also known as UWB or as digital pulse wireless) is a wireless
technology used “for transmitting large amounts of digital data over a wide spectrum of
frequency bands with very low power for a short distance.”45 In addition to being able to carry
huge amounts of data over a short distance (up to 230 feet) at very low power, ultra wideband
radio also has the ability to carry signals through doors and other obstacles.46

        Although ultra wideband has traditionally had only two main types of applications
(applications involving radar and voice and data transmission using digital pulses, allowing a low
powered signal to carry information at high rates within a restricted range),47 it may have a
significant impact on electronic products in the future.48 According to a Dow Jones Newswire
report, ultra wideband will be embedded in electronic products starting in 2006 to boost speed
and data capacity so that consumers will be able to finally break free from the plethora of electric
cords. In the initial stages, adapters will be available to connect existing electronic devices
wirelessly, but as early as 2007, the technology will be included on some high-end cell phones
and MP3 players to facilitate adapter-less beaming of music and video from their computers
from up to 30 feet away.49 According to a study by UWB chip maker, Alereon Inc., sales of
products embedded with UWB technology will rise to 2.4 million in 2006, will reach
approximately 15 million in 2007, and will total an estimated 140.2 million by 2009.50

               7.      Bluetooth

        “Bluetooth wireless technology is a short-range communications system intended to
replace the cables connecting portable and/or fixed electronic devices.”51 The Bluetooth core
system is comprised of an RF transceiver, baseband, and protocol stack.52 The Bluetooth system
provides services that enable the connection of devices and the exchange of a variety of data
classes between these devices.53

        Bluetooth technology enables mobile phones, computers, and personal digital assistants
(PDAs) to be easily interconnected using a short-range wireless connection.54 “Using this
technology, users of cellular phones, pagers, and personal digital assistants can buy a three-in-
one phone that can double as a portable phone at home or in the office, get quickly synchronized
with information in a desktop or notebook computer, initiate the sending or receiving of a fax,
initiate a print-out, and, in general, have all mobile and fixed computer devices be totally
coordinated.”55 Bluetooth, however, requires that a low-cost transceiver chip be included in each

               8.      GPS

       The Global Positioning System (GPS) is a grouping of twenty-four satellites that orbit the
Earth making it possible for people with ground receivers to pinpoint their geographic location.
GPS location accuracy is generally anywhere from 100 to 10 meters depending upon the
equipment, but can be pinpointed to within one (1) meter when special military-approved
equipment is used. GPS equipment is widely used in science and has become increasingly
affordable permitting almost anyone to own a GPS receiver. The US Department of Defense
owns and operates GPS, but makes it available for general use around the world.56

               9.      RFID

        RFID (radio frequency identification) is a wireless technology that “incorporates the use
of electromagnetic or electrostatic coupling in the radio frequency (RF) portion of the
electromagnetic spectrum to uniquely identify an object, animal, or person.”57 An RFID system
has three components: an antenna and transceiver (often combined into one reader) and a
transponder, sometimes referred to as the “tag.”58 The antenna transmits a signal over radio
waves and activates the transponder.59 Once activated, the tag transmits data back to the
antenna.60 RFID is increasingly being used as an alternative to the bar code that has the
advantage of not requiring direct contact or line-of-sight scanning.61 RFID tags are also used to
track assets, manage inventory and authorize payments, and they increasingly serve as electronic
keys for everything from autos to secure facilities.

               10.     Biometrics

        Biometrics is a method of verifying an individual’s identity based on physical features
like fingerprints or iris patterns.62 Biometrics has emerged in the wireless industry as a result of
growing security concerns.63 Passwords have proven to be vulnerable and forgettable and are,
therefore, generally thought of as unreliable for security purposes.64 Biometrics has the potential
to secure networks and data without placing any responsibility on the user.65

       There are generally two types of biometrics. Behavioral biometrics measures how a user
performs an activity like typing on a keyboard or writing a signature. Physiological biometrics
examines the physical characteristics of an individual.66

       The use of biometric technology is increasing because of its integration into various
devices. Analysts expect that prices will likely continue to drop and the technology will continue
to be refined.67 Biometric features have already been integrated into Hewlett-Packard PDAs,

IBM ThinkPads, and other handhelds and laptops as a way of securing devices without requiring
users to remember numerous passwords.68

        In addition, retailers using products like onClick’s DigiPad, which records signatures,
have increased the use of biometrics.69 Although some believe that signing an electronic pad
results in a side-by-side comparison of their signatures, “the sensors are actually tracking
behavioral biometrics, recording the speed, pressure, and style of writing rather than the loops of
the actual signature.” 70

               11.    3G Technology

       3G technology is an industry standard for third-generation (3G) wireless networks. The
3G standard, called International Mobile Telecommunications-2000 (IMT-2000), consists of five
operating modes, including three of which are based on Code Division Multiple Access (CDMA)
technology.71 These 3G CDMA modes are most commonly known as CDMA2000, WCDMA
(UMTS) and TD-SCDMA. 3G CDMA efficiently provides high quality voice services and high-
speed packet data access, and it is the preferred technology for 3G.72

        3G technologies hold much promise and might give cellular-enabled devices an edge
over other wireless technologies. For instance, because a wireless broadband signal can travel
over the same cellular sites as wireless phones, there is no limited range from the cell tower or
“hot spot” that must be accessed, as there is for Wi-Fi, meaning users can gain access anywhere
they can locate a secure cellular signal. This could potentially provide high speed wireless
Internet access service to customers that are outside of traditional cable modem or DSL areas.

               12.    Higher Speeds & Mobile Broadband Services

       Providers appear to be competing in terms of mobility and speed. For example, Cingular
launched its High Speed Downlink Packet Access (HSDPA) technology in 16 cities on
December 6, 2005.73 Other companies offering technologies to deliver higher speeds and mobile
broadband services include Sprint with its Power Vision(SM) service,74 and Verizon Wireless,
which enables Verizon’s VCast broadband multimedia service.75 Still other carriers have
deployed networks supporting higher-speeds and new applications, and more investment is
occurring. Merrill Lynch has reported wireless carriers invested $24 billion in 2005.76

        As a result of increased investments by wireless carriers, the role of fixed wireless
broadband solutions will also increase. For example, Motorola’s canopy network solutions now
deliver high-speed data and voice services as an alternative to or an extension of wired solutions
helping carriers reach unserved and underserved residential, business and enterprise markets.
This network application also allows companies to penetrate deeper into their customer base and
offer new in-demand revenue enhancing services like VoIP, video, and gaming.77

       C.      Data Applications

        Wireless or mobile technologies encompass a number of applications beyond voice
service. These applications may be bundled with the voice service on a cell phone, or they may
be provided with some other standalone wireless device, such as a PDA. Data applications –
such as text messaging (or short messaging service (SMS)), e-mail, ringtone, music, and video
downloads, web surfing, and taking digital photos and sharing them – are becoming increasingly
popular. Consider the following:

       •      In June 2006, SMS traffic reached more than 12.5 billion a month, up 71% from

       •      Worldwide sales of camera phones in 2004 surpassed sales of digital camera
              sales, 12% of US households have camera phones.79

       •      In 2004, U.S. wireless subscribers downloaded approximately 250 million
              ringtones, in 2005, this figure is expected to increase 60% to 400 million.80
              Worldwide, carriers are exceeding $3 billion in annual ringtone revenues.81

       •      As of October 2006, nearly eight million mobile users were generating their own
              video content.82

       •      In May 2005, the wireless industry began offering “Wireless Amber Alerts” to
              cellular subscribers who opt-in to receive text message alerts with information
              about children abducted in the subscriber’s region.83

       •      Sirius and XM, rival satellite radio offerings, have expanded beyond car stereos
              and into homes, offices, and portable devices. In June 2005, Sirius Satellite Radio
              agreed to the use of Sprint’s wireless network to offer some music channels to
              Sprint customers later that year.84 Multiple wireless carriers now offer XM
              satellite channels over their network to their subscribers as well.

       •      Jupiter Research predicts that over the next five years, the wireless gaming market
              in North America will “increase tenfold,” becoming a $4.1 billion industry.85

       •      Napster and Ericsson have joined forces to develop a wireless version of
              Napster’s online music service to deliver full-length songs to wireless phones and
              make it available to wireless carriers around the world.86

       •      Verizon Wireless offers Timecard, an application developed by ECONZ Wireless
              that allows remote employees to clock in and out via their wireless phones and
              transmits the information to an employer-accessible password-protected Web
              page to assist in payroll preparation.87

       •      When drivers in Coral Gables, Florida need to feed parking meters, they can dial
              into the automated system via their wireless phones, enter the assigned parking
              space number, and call back on exit to end the billing cycle and have the
              transaction billed to their credit card.88

        Data applications are becoming increasingly important to the wireless industry as well as
to content providers. For example, CTIA – The Wireless Association reports that wireless data
revenues are rising each year, with 70% growth from 2005 to 2006.89 The Yankee Group
projects that wireless data applications will account for 13% of the wireless industry’s revenue

by 2008,90 and Kagan Research reported data revenue will grow to 20.9% of total service
revenues in 2014.91 Content providers are taking note, and as reported in, “newly
inspired entrepreneurs and entertainment titans alike are in a mad rush to develop songs,
graphics, games and videos to light up millions of teensy screens.”92

       D.     Convergence of Wireless Device Functionality

         This section examines the new devices that are being deployed by wireless carriers. One
website,, includes a listing of devices newly offered by service
providers,93 as well as listings of devices newly authorized by the FCC.94 The examples given in
this section are not meant to be an exhaustive list of the products available to consumers, but
rather illustrative of the high degree of innovation in the wireless device marketplace.

               1.     Cellular Phones

        Dual-mode Wi-Fi phones were introduced in 2006 and are being marketed by several
providers. The phone functions like a regular cell phone, but connects to a Wi-Fi hot spot when
indoors. 95 In mid-2006, T-Mobile introduced its “HotSpot@Home” dual-mode, Wi-Fi device in
limited markets.96 HotSpot@home is based on Unlicensed Mobile Access (UMA) technology,
which permits wireless operators to offer familiar GSM services over unlicensed spectrum using
WiFi technology.97 HotSpot@Home requires a dual mode GSM/WiFi handset and a broadband
connection.98 T-Mobile currently offers two sleek handsets and a WiFi access point optimized
for UMA.99 However, HotSpot@Home phones are designed to work at any open WiFi access
point.100 Forrester Research has reported that the demand for the “dual-mode” Wi-Fi phone
may be high.101

       Although analysts say TV on mobile phones is at least two years from reaching a mass
U.S. audience, the technology has already established a presence in Europe and Asia.102
Telephia reports that more than 2,000 mobile video titles are available to US wireless
subscribers.103 Strategy Analytics estimates “that by 2008, more than 150 million people
worldwide will be watching video on their mobile phones, generating about $4.7 billion in
annual revenue for the tech industry.”104

               2.     Smartphones

       “A smartphone is any electronic handheld device that integrates the functionality of a
mobile phone, personal digital assistant or other information appliance. This is often achieved by
adding telephone functions to an existing PDA or putting “smart” capabilities, such as PDA
functions, into a mobile phone.”105 The following are some examples of the variety of
Smartphone devices and functions to which consumers have access.

         T-Mobile USA and Research In Motion (RIM) announced the availability of the new
BlackBerry 7105t together with a new BlackBerry Internet E-mail service for Yahoo e-mail
users.106 Users of the BlackBerry 7105t will be able to access their Yahoo e-mail accounts
directly on their BlackBerry handset and will receive real-time delivery of e-mail messages sent
to their Yahoo e-mail accounts. 107 This device is also a quad-band phone and contains Bluetooth
technology, speakerphone capabilities, wireless e-mail, text messaging, a web browser, instant
messaging, an organizer, and RIM’s SureType technology. 108
       The Palm Treo, Palm Inc.’s smart phone has been a popular choice for many mobile
professionals.109 The Palm Treo combines a camera, MP3 player, and an Internet browser. The
Palm Treo 650, 700w, and 700p are all currently available. In addition, Research in Motion has
announced that it is developing e-mail software that is similar to that of the BlackBerry for the
Palm Treo, providing the Treo with even more options.

         Hewlett-Packard’s Windows Mobile-based Pocket PC smart phone, the iPaq hw6515, is
equipped with an integrated keyboard, a built-in 1.3-megapixel camera, a Global Positioning
System receiver, Microsoft Pocket Streets mapping software, 64MB of ROM and 64MB of
RAM.110 The iPaq hw6515 also includes pocket versions of Microsoft Office programs, making
it easier to view and edit files from the smart phone. 111

        Motorola Rokr E1 was the first phone designed to play music downloaded from Apple
Computer’s hugely popular iTunes organizer. The phone, which is being sold through Cingular
Wireless, stores up to 100 songs. The Motorola Rokr E1, a bar-style tri-band GSM phone, also
features built-in stereo speakers, a VGA camera with flash, Bluetooth, microSD (TransFlash)
memory card slot, speakerphone, and an airplane mode.112

         Samsung’s SGH-E750 and SGH-E760 tri-band handsets follow Samsung’s well-
established clamshell design and are equipped with a 1.3 Megapixel camera, a digital compass
and gesture recognition for mobile gaming. The Samsung SGH-E750 camera also comes with an
integrated flash, with the SGH-E760 including a “digital power amp” and twin speakers for
enhanced audio. In addition, Samsung’s phones can wirelessly stream MP3 music via Bluetooth
to the latest Bluetooth stereo headsets, like the SBH100.113

              3.      Wireless E-mail Devices

         Wireless e-mail devices, including the ubiquitous Blackberry, are increasingly popular
among consumers. According to the Wall Street Journal, “more than 42,000 organizations have
a Blackberry e-mail server,”114 and with the company’s recent addition of 592,000 customers in
its last quarter, 3.1 million people now use the hand-held device.115

       The success of the BlackBerry is spurring competition in the wireless e-mail market. For
example, Good Technology, Inc. is competing against the dominant Blackberry by targeting
corporate customers and making its software product, GoodLink, available on devices other than
the Blackberry. It is also contracting with Cingular Wireless to aid in distribution.116 As of
November 10, 2006, Good Technology indicated its software and service is being used by
12,000 enterprises worldwide117 and is reportedly competing with Blackberry’s perceived
weakness of predominantly requiring use of its own devices in order to increase

              4.      Pocket PCs/PDAs

        Devices such as Pocket PCs and PDAs are increasingly converging with mobile
technologies. For example, the Palm TX is equipped with an integrated Wi-Fi chip and 100MB
of user-accessible flash memory.119 Flash memory can store data even if the device loses battery
power and utilizes a “312MHz XScale processor from Intel, an expansion card slot that supports
the SD I/O, SD, and multimedia card (MMC) formats, and a 320-pixel by 480-pixel screen.”120
                                             - 10 -
The Palm TX also includes DataViz’s Documents To Go software for creating and editing files
and is compatible with MobiTV’s application that will allow users to watch live television on
handheld devices.121

         The Palm Z22 is equipped with a color screen and 20MB of user-accessible flash
memory. 122 The Z22 is very inexpensive (said to be “cheaper than buying a paper organizer and
refilling it every year with the new calendar”) and appropriate for persons who do not need a Wi-
Fi connection. 123

              5.      Laptop Computers

        Wireless technologies are increasingly becoming standard features in laptop computers.
Consider the following examples of manufacturers who are adding features that can be used with
wireless technologies. For example, in the U.S., Dell customers can purchase Latitude D620 and
D820 laptop computers equipped with Verizon or Cingular’s 3G as well Wi-Fi technologies for
wireless data capabilities.124 4G Mobile and the Dubai based i-mate have launched the world’s
first Windows Mobile 5.0 mini laptop phones in India.125 Jasjar, K-Jam, PDA handset, JAM and
SP3i are the five products that were launched in the Indian market.126 The mini laptop phone
known as the Jasjar has a 520 MHz Intel processor, 128 MB of permanent memory and Internet
telephony software allowing the user to browse through the Internet at high-speed.127 The model
known as K-Jam has a 1.3 mega-pixel camera, “is EDGE enabled and has a 2.8 TFT
Transfelctive LCD and mini USB, allowing the user to enjoy advanced PDA functions.” 128

        In addition, Hewlett-Packard recently expanded its notebook line to include new models
for the HP Pavilion dv1000 series entertainment notebook, which will include a built-in
Webcam.129 The HP Pavilion dv8000 series will include Microsoft Windows XP Media Center,
“which is designed to allow users to watch, record and pause live TV, as well as edit and share
digital content.”130 In addition to a wireless keyboard, mouse and remote control, Hewlett-
Packard’s new Pavilion Media Center m7300n series Photosmart PC will offer Wi-Fi

        With the application of biometrics technology, some laptop computers are now equipped
with built-in wireless security. IBM has incorporated fingerprint reading capability into its
laptop line.132 In early 2005, the company announced its ThinkPad T43, a new line with a reader
that linked to an embedded security subsystem to provide built-in security.133 The company
noted that it is investigating ways to integrate biometrics into all of its product lines.134

              6.      Bluetooth Devices

       Bluetooth devices use wireless technologies to increase the ease of use and the
consumer’s experience with electronic devices. The Bluetooth Media Player Headset is an
adapter that sits between headphones and any audio/media player (CD/DVD/MP3) and provides
wireless Bluetooth headset functionality. The Bluetooth Media Player Headset enables a user to
answer a call while listening to music by switching to Bluetooth mode.135

       The SONORIX Bluetooth Audio Player OBH-0100 is the first product of its kind in the
world to integrate mobile, wireless and audio technologies into a multi-purpose entertainment

                                             - 11 -
device. In addition to the basic profiles, the key profiles supported are A2DP, Headset profile
and Handsfree profile.136

        With the Bluetooth Media Center MMV-200 plugged into a user’s stereo, music stored in
the user’s mobile phone can be transferred wirelessly to the loudspeakers. The Bluetooth Media
Center MMV-200 can also be connected to a TV and beam Mega pixel images and video clips
from the user’s mobile phone to the screen. Memory cards (from a phone, PC or digital camera)
can be inserted directly into the MMV-200. The consumer’s phone functions as a remote

        The Bluetooth PowBOXTM is a portable wireless communication device built on
Bluetooth & Audio Entertainment Platform. This integrated device includes the Bluetooth
Headset/Handsfree Function, MP3 Player, FM Radio, Voice Recording, Sharing Headset and
Bluetooth files transfer Memory Storage. It can work alone with all Bluetooth Qualified Products
and is compatible for Windows based computers with the USB interface.138

              7.      Digital Cameras

        Digital cameras are also incorporating wireless technologies to increase consumer
experiences. For example, Kodak’s EasyShare-One zoom digital cameras now allow digital
pictures to be sent by e-mail directly from the camera, without cables and without access to a
computer.139 The camera is equipped with a pop-up Wi-Fi card that makes it possible to share
pictures wirelessly.140 However, in order to send pictures wirelessly, the EasyShare-One must
access a Wi-Fi network or a public hot spot.141 Although the camera does not contain an Internet
browser and, therefore, cannot connect to a Wi-Fi hot spot that requires “authorization,” Kodak
is partnering with T-Mobile on developing a plan in which camera buyers take advantage of T-
Mobile hot spots. 142 The Kodak’s EasyShare-One zoom has the picture-taking ability of the 4-
megapixel, 3X optical zoom Kodak and video capability. In addition, the camera has 256
megabytes of internal memory that allows the camera owner to store and organize up to 1,500

        Hewlett-Packard’s recent additions to the HP Photosmart digital-camera line include
cameras that have a button for ordering and sharing photos through Snapfish, Hewlett-Packard’s
online photo service.144 Snapfish has designed a system that will allow users to access, review,
store, and share digital videos from their cell phones and digital cameras.145 The service uses
technology designed to convert most digital video formats into a common one that can be played
through most Internet browsers.146

              8.      M-Commerce – Major Component of Wireless Sector

        As the role of wireless devices continues to shift from “purely communicational” (voice)
to transactional, mobile-commerce (m-commerce) will become an increasingly important tool for
businesses to reach consumers.147 By 2007, according to ARC Group, “approximately 546
million users will spend close to $40 billion on mobile commerce.”148

       M-Commerce offers a number of applications that may appeal to the mobile consumer.
Using wireless devices, consumers have the ability to:

                                             - 12 -
       •       Purchase items instantly in the retail sector.

       •       Perform financial transactions such as transfers, bill payments, and security
               trading with banking institutions.

       •       Check-in to flights and receive electronic boarding passes.

       •       Download and play a wide variety of network games.

       •       Receive up-to-date news, stock prices, and weather information. 149

        E-Commerce Times reports that “with improvements in technology and business models,
momentum is steadily building” and appears to be favorably anticipated by content providers,
wireless carriers, and consumers.150 Content providers are motivated to explore m-commerce
because it should significantly reduce distribution costs, for example.151 Wireless carriers also
are looking for opportunities to add consumer value in a manner that generates additional sources
of revenue, especially as average revenue per user (ARPU) for voice products continues to
decline in the face of increasing competition.152 Industry data indicates that the average ARPU
has fallen 82% since December 1994.153

       Data indicates that consumers are accustomed to purchasing incremental services on their
wireless phones, and their comfort with such micropayments is expected to spur growth in m-
commerce.154 A survey by ForceNine Consulting and Wirthin Worldwide showed that
customers have already exhibited a willingness to pay for the “extras.” Consider that 40% of
U.S. adult mobile consumers who use non-voice applications on their phones pay additional
charges for such services, and given the trends observed in other countries, the opportunities for
mobile content providers will grow as consumers eventually move from personalization
applications such as ringtones to more complex applications such as interactive java games.155

        Handset manufacturers are focusing on the expansion of m-commerce. For example, in
May 2005, NTT DoCoMO, a leading mobile communications operator in Japan, and its eight
regional subsidiaries announced five new wireless phone models “equipped for mobile wallet e-
money, ticketing and other handy mobile smart-card functions.”156 Though the underlying
FOMA (freedom of multimedia access) service on this new series of “mobile wallet” handsets is
currently only available to subscribers in Japan, it is a sign of things to come for other countries
such as the US that are making strides in the development of m-commerce.157


        Wireless technologies have had many positive impacts on consumers and on the social
and economic development of the country as a whole. Part A of this section addresses some of
the key consumer and social benefits and challenges implicated by wireless technologies. Part B
briefly discusses the impact of the wireless industry on the nation’s economy.

                                               - 13 -
       A.      Consumer and Societal Interests and Challenges

               1.      Current FCC Data Regarding Extent of Wireless Industry Competition

        The FCC’s Eleventh Annual Report and Analysis of Competitive Market Conditions with
Respect to Commercial Mobile Services (Eleventh Report), released September 29, 2006, noted
that, with respect to carrier conduct, competitive pressure continues to drive carriers to introduce
innovative pricing plans and service offerings, and to match the pricing and service innovations
introduced by rival carriers.158 The FCC stated, “Consumers continue to pressure carriers to
compete on price and other terms and conditions of service by freely switching providers in
response to differences in the cost and quality of service.”159

        The FCC report went on to say “[I]ndicators of market performance show that
competition continues to yield significant benefits to consumers.”160 As an example of the
wireless market’s competitiveness, consider that there are approximately 183 facilities-based
wireless carriers that serve some portion of the U.S. This includes four national carriers, such as
Verizon Wireless, and many more regional and local carriers, and numerous resellers or Mobile
Virtual Network Operators (MVNOs), such as Virgin Mobile USA.161 Some 94% of Americans
have a choice of four or more wireless carriers, and approximately 98% can choose from at least

        While many consumers have an ability to choose from a number of carriers, competition
among the carriers continues to grow.163 The advent of pre-paid cell phones gives consumers the
ability to avoid long or short-term contracts and related early termination fees with wireless
providers altogether.164 Additionally, the Eleventh Report concluded that “U.S. consumers
continue to benefit from robust competition in the CMRS marketplace” with demand increasing
for both voice and data services165 as mobile carriers “continue to build out their networks and
expand service availability,” including deployment of technologies “that allow them to offer
mobile Internet access services.”166

       Prices for wireless services have continually declined. In 2004, the average wireless bill
was $38.71, a 42.5% decline from the 1993 average bill of $67.31.167 Many plans no longer
charge for roaming or long distance. In fact, the FCC reported a 13% decrease in the price per
minute in 2003.168 The Eleventh Report noted that “[e]quity analysts and other industry
observers continue to describe wireless price competition in the United States as intense.”169

        Similarly, the competition resulting from numerous providers and plans has increased
market penetration. In 1993, there were 11 million U.S. wireless subscribers, representing 5%
market penetration of the entire US population, but by June 2006, there were 219.4 million U.S.
wireless subscribers, representing 72% of the population.170 It is important to note, “[a]s
wireless penetration among new users begins to slow and the competition to keep existing
customers continues to accelerate, the likelihood of switching providers among those most
dissatisfied with their recent retail purchasing experience has increased 46% from 2004.”171 A
slowing penetration rate means that the wireless industry may become increasingly competitive
for retailers as fewer new customers enter the market.172 In comparison, we should also note that
wireless subscribership is growing faster than, and currently double the number of, Internet
subscribership around the world.173 According to a study by Kagan Research, there will be 273.8

                                               - 14 -
million subscribers in the U.S. by 2014, up 48% from 2004. This demonstrates that the
penetration rate could reach 82.6% if current population forecasts materialize.174

               2.      Consumer and Societal Benefits

                       a.      Improved Communication

       Wireless technologies have improved our ability to communicate and stay in touch with
one another in an infinite number of ways. Many of the wireless technologies consumers use
today to keep in touch with one another are obvious. For example, cell phones allow us to
communicate with friends, family, neighbors and other members of the community at almost any
time and place. Digital cameras allow us to send pictures to friends and family in a matter of
moments, if not seconds. Email, instant messaging, and text messaging also allow us to make
contact with others in an instant.

        However, there may be other modes of communication that wireless technology has
made possible that are not as readily apparent. For example, satellite technology enables local
non-profit groups around the country to participate in various forums or meetings facilitating the
exchange of information and ideas. Examples of these wireless-enabled forums are emerging,
such as Civic Network Television (CNT), a non-profit organization, which provides the
equipment and support necessary to enable non-profit groups around the country to
simultaneously participate electronically in courses, forums, and/or town meetings.175 “The
events take place in Washington, but they are beamed via satellite to conference rooms across the
country.”176 The individuals participating in the event from remote viewing sites can observe
and communicate with the participants in Washington as well as other remote locations. “The
result is a series of conversations on civic and community issues that involve people all across
the United States.”177 The topics discussed during these forums include how to mobilize
community assets, how to develop leadership in divided communities, as well as the
fundamentals of collaborating in small and large communities.178

                       b.      Education

        “E-learning has changed from a technological curiosity to an integral part of rural public
school education, offering more class options to students and even educating teachers.”179
Although education via high speed data networks has the potential to revolutionize many types
of learning, its application to educating those located in rural areas is among the most important.
One of the goals of distance learning is to bridge the learning gap that exists between public
schools located in rural and urban areas. An examination of the number of school age children
living in rural areas reveals its importance. Statistics show that almost one third of this country’s
48 million public school students and 43 percent of this country’s public schools are located in
rural communities.180

       Today, with the spread of advanced technology, “groups of isolated schools in more than
a dozen states–including Minnesota, North Carolina, and Oklahoma–can share qualified teachers
in subjects like physics, advanced math, and foreign languages.”181 Now several states,
including Nebraska, South Dakota, and Iowa, offer teachers and other staff classes toward
advanced degrees or professional certification through distance learning.182 Students also receive
individual assistance when needed, despite the physical distance from their instructors.
                                               - 15 -
“Instructors offer small early-morning study groups through the videoconferencing system and
contact students on the phone or via e-mail if they seek individual help.”183

        Distance learning is not, however, only providing assistance in traditional public school
settings. Native American reservations in Montana, for example, are receiving math classes, and
people living in the hills of West Virginia are receiving arts and health courses via high speed
data networks. For example, HPWREN, the High Performance Wireless Research and Education
Network, is attempting to help bridge the “digital divide” by delivering high-speed Internet
connectivity to several remote communities in California.184 HPWREN has most recently
connected the Santa Rosa Native American reservation, which is located in southeastern
Riverside County. HPWREN’s first wireless link to the Native American community involved
the Pala Native American Indian reservation, which is home to more than 600 tribal members,
including more than 150 children who attend elementary school on the reservation. “By
providing the Pala Learning Center with high-speed Internet access, UCSD has opened up an
incredible amount of opportunities for our tribe and its future generations,” said Robert Smith,
Pala Tribal Chairman.185 In addition to the Pala Tribe collaboration, the Rincon and La Jolla
reservations are now also connected to the HPWREN.186

                      c.     Rural Consumers

        Many remote residences, businesses, communities and communities located in difficult
and rugged terrain face heavy challenges in obtaining ubiquitous wireline broadband access.
Such areas may be uneconomical to serve with fiber, outside the 3-mile DSL distance limitation
or outside the footprint of a cable telecommunications company. Some remote communities still
lack basic phone service. Wireless broadband may be an effective option in these types of
situations. As USA Today reported, “improved wireless technology has allowed several
thousand mostly small Internet providers across the USA to cheaply deliver broadband to remote
areas via antennas on hilltops, barns and homes.”187 Indeed, wireless service providers are
spending billions of dollars to improve their network coverage, capacity and quality across the
U.S. Wireless providers have invested more than $130 billion in the last six years alone.188 In
addition, as discussed above, municipalities, including many in rural areas, are increasingly
deploying broadband technologies to provide broadband services to their residents.

       As wireless technologies eliminate the need to run physical wires, community
connectivity to the Internet, or a high-speed backbone network, may be obtained through a
wireless “back haul” that can cover dozens of miles. In addition, “the minimal costs for
construction and equipment acquisition, along with the ease of configuration and maintenance,
represent a true sea change in technology, and provides the means for rural communities not only
to catch up to their metropolitan counterparts, but to surpass them in the availability of
bandwidth. For once, rural America can be a technology leader.”189

        One example of the benefits of wireless technology for rural consumers is in home health
care. As Kenneth Schlager discussed, wireless broadband communications networks increase the
productivity of rural home healthcare by providing higher quality care at lower cost. He added
that “video teleconferencing coupled with computer server-based communications and resource
management provides the foundation for a renaissance in rural home health care.” 190

                                             - 16 -
                      d.     Business Consumers

       Wireless technologies offer businesses the ability to reduce costs and improve
communications with employees, clients, customers, and suppliers. It is generally reported that
businesses have increased productivity by providing remote employees with wireless access to
information and databases. Similarly, cost reduction goals are achieved as paperwork,
timesheets, and memos are delivered to mobile devices. Communication with traveling
employees or employees working in distant offices has improved through the use of
teleconferencing and videoconferencing, and e-mail has enabled documents and information to
reach employees anytime and anywhere.

        Wireless technologies are also helping businesses in many ways that may not be
commonplace. As one example, wireless technology can provide assistance to businesses by
helping them locate or track equipment and inventory. Consider that C and C Marine Services
Company, a major barge company, now utilizes this type of wireless application to allow its
headquarters to communicate directly with its fleet of 223 barges.191 The managers were having
difficulty determining the exact positions of the Company’s barges, and, therefore, they were
unable to efficiently schedule the barges for additional work, barges were under-utilized and
customers were not served effectively. The solution was a wireless application that provides
continuous GPS-based location data and allows communication between the fleet and company
headquarters.192 “Now the company instantly knows the position of barges in its fleet and can
schedule them more effectively, decreasing downtime and response time to customer requests
while increasing sales.”193

                      e.     Special Needs Consumers

        A number of wireless technologies focus on increasing accessibility and assistance for
special needs consumers. Some of the products and services that have already shown the ability
to effect the methods of communication for special needs consumers are described below.

       Mobile Captioning System

        A mobile captioning system developed at the Georgia Tech Research Institute uses
wireless technology to provide captioning for the approximately 10% of Americans who are deaf
or hard of hearing. At numerous venues, information is presented audibly to the public.
Simultaneously, the captions are transmitted to a receiver device such as the individual’s PDA or
laptop using Wi-Fi technology, which is already installed, in numerous public places where
events such as government meetings or sporting events are typically held. The technology also
has uses for hearing individuals, such as for transmitting statistics at a baseball game or for
translating foreign languages into English.194

       TTY Services

        Many wireless providers are seeking to support the deaf community by making “TTY”
available on mobile phones.195 TTY, also known as teletypewriter and as Text Telephone
Device or Telecommunication Device for the Deaf (TDD), enables people who are deaf, hard of
hearing, or speech-impaired to use the telephone to communicate.196 TTY services require a
special device at both ends of the conversation and work by allowing people to type messages
                                             - 17 -
back and forth to one another instead of talking and listening.197 When a TTY device is used in
conjunction with a TTY-compatible wireless phone, customers with speech and hearing
disabilities can communicate wirelessly.198

       For example, T-mobile and Cingular both offer a wide selection of phones that are TTY
compatible.199 In addition to providing TTY services, both the SideKick and the Blackberry
provide relay service online, and AOL Instant Messaging (AIM) also permits persons with
hearing disabilities to communicate. The benefits of such services to the hearing disabled
community are immeasurable. In the context of 9-1-1, a TTY compatible mobile phone allows
an individual to communicate on his or her own TTY with TTYs located at the Public Safety
Answering Point when calling emergency services.200

       TTY Compatible Devices

        T-Mobile’s SideKick, a popular device, is common among the hearing impaired because
the device is equipped with screens that are capable of showing more detail than a standard cell
phone, and the device also allows both instant messaging and Web surfing.201 Other PDA type
devices such as PocketPC, Palm, Treo and Nokia are providing similar services. However,
States with programs for the deaf and disabled community typically limit universal service help
to telecommunications services and do not allow text pagers. California is a state that has
released a rulemaking considering whether text pagers might be allowed for deaf and disabled
consumers who desire it.

       Relay Services

       Many TTY users can employ a process called “relay.”202 The relay process utilizes an
operator to translate text in order to have a phone conversation with a hearing person.203
Persons with hearing disabilities can now access the Internet and make free operator-assisted
phone calls from Web sites such as

        Sprint Relay Wireless, powered by GoAmerica, is available as an addition to the T-
Mobile Sidekick and provides access to relay services.205 Sprint Relay Wireless was designed
for the T-Mobile Sidekick and allows hearing impaired persons to utilize relay services from a
mobile phone, obviating the need for a computer.206 MCI Wireless offers similar
relay services.207

        Sprint Relay Wireless enables wireless users to connect to online relay services from
virtually anywhere using a choice of wireless handheld devices, including the RIM 957, 950,
850, 857, and SideKick.208 With Sprint Relay Online, calls may be placed from any Internet
connection, and there is no need for traditional TTY equipment. Sprint Relay Online is a free
service that combines traditional relay service with the ease of the Internet allowing disabled
individuals to communicate on the go. 209

       Video Relay

       Video relay involves the use of a computer and a video camera connected to the Internet
to make telephone calls.210 The hearing disabled caller uses sign language to communicate with
an operator through the Web-cam; the operator then translates to the hearing person on the other
                                             - 18 -
end of the call.211 The operator then translates the hearing person’s response into sign
language.212 Video relay allows people to communicate at a much faster speed and is a much
smoother mode of communication.213

        Sprint Video Relay Service (Sprint VRS) is powered by Communication Services for the
Deaf (CSD) and enables American Sign Language (ASL) users to communicate using facial
expressions and body language cues. Through the use of full-motion video, words and phrases
are conveyed along with facial expressions and body language cues to ensure that nothing gets
lost in translation.214 “People who are deaf, hard of hearing, deaf-blind, or have a speech
disability enrich their independent lives by utilizing relay services.” 215 Such services utilize
TTY/TDD devices and allow the disabled individual to communicate with friends, family,
business associates, and service providers so they may participate in daily community life. 216
“Both parties either see or hear every word uttered in the conversation.” 217

       Relay Conference Captioning

        Sprint Relay Conference Captioning (RCC) is a service provided by Sprint that combines
real-time captioning and voice relay service to provide conference calls for deaf and hard-of-
hearing people. RCC services can be accessed from any Internet-connected computer and allows
the hearing impaired person to receive real-time text of the conversation. A captioner will speak
a typed response to the other participants in the conference call. Such services are important to
the hearing impaired community as the number of conference calls increase as a result more
workers relying on teleconferencing as a normal course of business. 218

       Assistance for the Visually Disabled

        The combination of TALKS by Cingular Wireless and the Nokia 6620 offers new
assistance and accessibility to individuals with visual disabilities.219 TALKS by Cingular
Wireless is essentially a speech-enabling software that basically transforms the Nokia 6620
cellular handset into a “talking mobile phone.”220 The TALKS/ Nokia 6620 combination will
allow persons visual disabilities to, inter alia, hear incoming Caller ID, know the phone’s signal
and battery strength, text message and email, compose and access multi-media messages
In addition, the Owasys 22C, a cellular telephone developed specifically for the visually
impaired, enables individuals to place and receive telephone calls using a speaking interface.222
The Owasys 22C has omitted the screen altogether and instead includes widely spaced buttons
on its keypad.223 With the Owasys 22C every function speaks, including the caller ID, battery
and signal strength, phonebook, call logs, and configuration menus.224 It is also equipped with a
speaker phone that only the operator of the phone can turn on.225 This feature provides privacy
and ensures that caller information will not be spoken aloud unless the loudspeaker is turned

                      f.      Improved Healthcare – Telemedicine

        Wireless technologies also have a number of applications in the health-care arena. Non-
voice wireless technologies may be employed in the health sector, for example, to analyze
patients remotely, to perform mobile medical examinations, and to outfit patients with wireless
medical monitoring devices.227 In addition, activities of those confined to wheel chairs can be
                                              - 19 -
monitored with wireless devices that record how individuals shift their weight, and this
information may be used to promote healthy skin.228

       Wireless medical record systems, especially those utilizing Wi-Fi technology, allow
medical staff to access and update records and make orders at the point of care.229 Such actions
reduce errors and delays, improve efficiency and fit into the medical staff’s workflow.230 Some
physicians even believe that using mobile technology to access medical records will increase the
amount of time they are able to spend with patients.231 It is imperative that medical records be
available anytime and anywhere and wireless medical systems make this possible.232

        Such wireless medical record systems typically consist of wireless laptops (Wi-Fi access
points) set up on carts in patient wards, treatment facilities and patient corridors. The carts can
then be rolled from bed to bed and ward to ward as necessary. Wireless tablets and sometimes
PDA’s often supplement these laptops, either to provide staff with a dedicated device or for use
in other medical activities. 233

        “Wireless medical record systems are also inexpensive to deploy, costing a few percent
of the total budget of an electronic medical records (EMR) system.”234 Ohio State University
(OSU) Medical Center, a teaching hospital in Columbus, Ohio; St. Vincent’s Hospital in
Birmingham, Alabama; Memorial Medical Center in Springfield, Illinois, and St. John’s Hospital
in Springfield, Illinois have all deployed wireless medical records systems. 235

       The Lifenet Medtronic system is a system that utilizes wireless Bluetooth technology to
link cell phones to cardiac monitors in the field, which in turn links ambulances with local
hospitals. Using Lifenet, doctors are able to save critical time by making a diagnosis and being
prepared to operate as soon as the patient arrives at the hospital. 236

       Video cameras and wireless laptop computers are also aiding those who have had strokes.
Local hospitals now have the ability to set up video camera systems that are linked to distant
hospitals and experts.237 The wireless laptop allows the expert to view all scans and tests with a
near perfect view and make an early diagnosis.238 This process speeds treatment to the patient
and saves critical time.

                      g.      Disaster Relief

      In most cases, cellular or PCS wireless phones are an essential element in coordinating
and providing emergency relief when a natural disaster renders useless traditional wireline
communications. This was particularly evident in the wake of Hurricane Katrina, which
decimated traditional communications networks.

        A columnist for the Chicago Sun-Times, who traveled with two guardsmen into the
floodwaters of New Orleans after Hurricane Katrina struck, reported that “it was clear the cell
phone is among the most important tools the guardsmen bring with them.”239 Cell phones were
used to pass along orders and commands and one guardsman stated that “[i]t’s just easier to talk
on cell phones than walkie-talkies. Without cell phones we’d have to run back and forth between
trucks.” 240

      The ability to use cellular phones in the wake of a natural disaster can be compromised,
however, if the cellular communications infrastructure is damaged. In those situations, satellite
                                                - 20 -
technology can fill the gap. “When electricity, Internet connections, and cellphone towers [are]
lost . . . satellite phones become the only way officials and emergency workers could

         Satellite phones work by beaming their signals to satellites that are orbiting the Earth, and
the satellite then sends them back down. 242 Since satellites are not damaged by natural disasters,
satellite phones can be used in emergencies when regular cell phones cannot. Satellite phones
also work in remote locations where other communications tools are useless. 243

         An emergency management communications system has been developed by Globalstar
LLC for this purpose.244 Globalstar’s emergency management communications system
(GEMCOM) consists “of a satellite backhaul network mated to a miniaturized cellular system
that allows first responders to communicate with each other, or connect to the public telephone
network via Globalstar. 245 Globalstar satellite phones are built into the portable unit and give
emergency workers access to critical information when land-based communications are
unavailable, such as during and after a disaster and in remote locations.” 246

        GEMCOMS utilizes standard cell phones and provides emergency workers with the
ability to place calls to numbers available on the public telephone network via Globalstar.247
Emergency workers will also have the ability to call other emergency workers within an
approximate half-mile radius. In addition, traditional wireline telephones can be connected to
GEMCOMS through standard telephone jacks. 248               A spokesperson for the National
Communications System said that the GEMCOM “units are definitely needed . . . We received
the unit 12 hours in advance of Hurricane Rita. Fortunately, damage from Rita was minimal, and
we have deployed the GEMCOMS to St. Bernard parish which was hardest hit in New

                       h.      National Security

         Wireless technology has become increasingly important to National Security strategic
initiatives. In fact, wireless technologies are currently being used in the field of biometrics, for
facial and iris recognition programs, and for transmitting real time video from crime databases
onto a wireless device for remote access.250

        The Federal Bureau of Investigation (FBI) has said that national crime rates are declining
and “telematics played a large role in curtailing the tide of previous years.”251 FBI agents use
mobile “briefcases” that contain “mobile computing capabilities, including laptops, GPS
capability, and wireless communication devices.” 252 “Fast dissemination of information to
agents on the street, and with state and municipal law enforcement and first responders is critical
in stopping crime and frustrating terrorists.”253

                       i.      Personal Security

       Wireless technology, such as cellular technology, has become central to personal security.
Cellular phones allow people to call for help in any number of emergencies where wireline
telephones are not available.

                                                - 21 -
       Recently, the wireless industry partnered with the National Center for Missing &
Exploited Children in order to make Amber Alert text messages available to wireless subscribers
that opt in to receive the geographically specific Wireless Amber Alerts.254 The hours
immediately following the abduction of a child are critical to the child’s successful recovery.
Wireless AMBER Alerts will be an invaluable tool in the search process by quickly distributing
the emergency information to a large number of people. Since more than 60 percent of
Americans own a wireless phone, Wireless Amber Alerts will increase the reach of the Amber
Alert program.255

        As another example, OnStar is the leading provider of telematics services in the U.S. and
currently has more than two million subscribers.256 OnStar’s in-vehicle safety, security, and
information services use GPS satellite and cellular technology to link the vehicle and driver to
the OnStar Center. 257 The OnStar in-vehicle safety and security system provides many services
to help protect drivers on the road.258 Such services include automatic notification of airbag
deployment, remote door unlock, emergency services, stolen vehicle assistance roadside
assistance and accident assistance. 259 While the OnStar center can communicate directly with
the driver in the event of an emergency, it is also capable of pinpointing the location of the car
and can dispatch local emergency units to assist.

                      j.      Anti-theft Measures

         Specific wireless technologies are being used to prevent theft and ensure personal
security. For example, LoJack is a vehicle recovery system that allows police to track and
recover stolen vehicles.260 LoJack operates based on wireless radio frequency technology via a
unit that is hidden in the vehicle by a certified technician and registered in the LoJack database.
When the vehicle is reported stolen, police computers send a silent radio signal to the vehicle,
automatically activating the LoJack transmitter hidden in your vehicle. Police can track the
silent signal from the LoJack device from the ground or the air.261

        In addition, biometric features are being integrated into Hewlett-Packard PDAs, IBM
ThinkPads, and other handhelds and laptops as a way of securing devices without requiring users
to remember numerous passwords.262 The retail industry is also utilizing biometrics to prevent
theft. Retailers are using products like onClick’s DigiPad, which records signatures and tracks
behavioral biometrics, recording the speed, pressure, and style of writing rather than the loops of
the actual signature.263

       B.      Economic Interests

       The wireless industry represents a key component of the nation’s economy. A recent
study estimates that 3.6 million jobs in the US are directly or indirectly dependent on the U.S.
wireless telecommunications industry.264 The study found that the wireless industry generated
approximately $118 billion in revenues in 2004265 and contributed $92 billion to the U.S. Gross
Domestic Product (GDP) in 2004.266 During the same period, the study showed that the wireless
industry paid approximately $63 billion in fees, taxes and levies to federal, state and local
governments,267 and the use and availability of wireless telecom services and products created an
approximately $157 billion customer surplus in 2004.268

                                              - 22 -
       The impact of the wireless sector on our economy can be understood from a number of
perspectives. Consider the following:

       •       Of the $118 billion spent on wireless products and services in 2004 by U.S.
               businesses and consumers, approximately $104.4 billion was spent on wireless
               telecommunications services.269

       •       Wireless carriers have invested approximately $200 billion nationwide. Even as
               wireless prices and average revenue per user (ARPU) are decreasing, the wireless
               industry continues to invest heavily in its network. 270

       •       CMRS-related patents in the U.S. increased from 876 in 1996 to a record high of
               2,390 in 2003 (not including unlicensed wireless, Wi-Fi, or UWB patents, which
               are also on the rise).271

       •       Wireless devices allow those traveling to remain in constant contact with
               customer, clients and co-workers thereby reducing unproductive travel.272
               Wireless devices also result in improvements in logistics,273 faster and more
               efficient decision-making,274 and expansion of small business enterprises.275

       •       Healthcare efficiency has similarly enhanced from wireless devices. Healthcare
               providers are able to reduce the amount of call-backs due to illegible notes and
               prescriptions by directly inputting patient information into a wireless handheld
               computer. An estimated 616,000 healthcare professional are already using
               wireless technology, which is saving in excess of $2.9 billion.276

       Over the next decade, it is anticipated that the wireless telecommunications industry will
generate an additional $700 billion in consumer surplus as volumes of use grow and prices
decline and productivity gains will generate over $600 billion in additional GDP.277 Further, the
use and supply of services and handsets is expected to generate over $450 billion in additional
GDP and create 2-3 million additional jobs.278

       Today, phones and plans commonly include innovative digital services, such as e-mail,
calendar, Internet access, and text message functionality. By mid-2006, the wireless industry
had achieved 190 million digital subscribers,279 and today, they have surpassed 97% digital
networks and achieved data rates up to 500 kbps.280 Just 10 years ago, service was
predominantly analog, Internet access was limited, and data rates were 4.8kpbs.281 As discussed
previously, wireless carriers are also increasingly investing in wireless broadband technologies to
expand consumers’ ability to stay connected (without a physical connection) and use more
advanced mobile applications.

       C.      Wireless Challenges

      The Council of Better Business Bureaus (CBBB) began tracking cell phone complaints in
1997. Between 2001 and 2002 cell phone carriers complaints jumped 263 percent to the top of
the most-complained about business. In 2003, it dropped only slightly to number two and in
2004 and 2005 regained the number one position. In 2004 the CBBB analyzed complaints and

                                              - 23 -
determined that they fell into three categories: (1) complaints about billing; (2) complaints about
the quality of customer service; and (3) complaints about misrepresentation or
miscommunication by sales or customer service personnel.                While the increase was
acknowledged to be, in part, attributable to the growth in popularity, the CBBB thought the
pattern was unusual, even for a new industry, and warranted a more in-depth analysis.282 It
should be noted, however, that these figures might be misleading if they are not put into context.
The CBBB divides most industries (other than wireless) into multiple categories. For example, if
the four separate categories used for the “car dealer” industry were summed into a single
category, as is done for wireless, complaints in that category would exceed wireless-related
complaints – and the settlement rate for those complaints would be lower than the wireless
industry’s 89% settlement rate. If the credit and finance categories were summed, their
complaints would be 68% more than those related to the wireless industry. Likewise, home
improvement and housing-related complaints would be practically double those related to

        Complaints at the FCC grew to 25,852 in 2005, but seemed to be dropping, as only 8,666
complaints were received by the FCC in the first half of 2006283 which represented a decrease of
39% from the first half of 2005. More than half were billing and rate-related.284 Some analysts
have posited that the large number of cell phone billing complaints may be partially attributable
to a common practice in which consumers agree to long-term contracts in order to receive
discounted or free wireless phones at the point of sale. Because these contracts may include
early cancellation penalties ranging up to $200 or more, consumers find it difficult and costly to
switch service.285

        In recent years, in response to the significant increase in consumer complaints about
service and billing, states have begun to exercise their authority to regulate cell phone carriers.
Significant positive changes in the industry have resulted from these state actions and
commitment to the issue. Some examples are listed below:

               1.     Voluntary Consumer Code

        Following a NARUC resolution adopting wireless best practices in July 2003, CTIA’s
Voluntary Consumer Code was adopted that September. The resolution was developed by
NARUC in cooperation with the FCC and the industry and adopted in lieu of a resolution
supporting regulation of wireless service quality. The three-year old Code is designed to
encourage greater wireless carrier communication and disclosure to consumers on a voluntary
basis. According to the CTIA website, 33 carriers, including all of the national carriers, have
adopted the Code and, in order to use CTIA’s Seal of Wireless Quality/Consumer Information in
their marketing materials, carriers’ compliance with the code must be demonstrated and
recertified annually.286 These carriers cover 93% of all wireless subscribers.

        Among other requirements, the Code requires carriers to “Disclose Rates and Terms of
Service to Consumer” and to include disclosure of “the amount or range of any . . . fees or
surcharges that are collected and retained by the carrier.” Commitment Six requires adopting
carriers to “Separately Identify Carrier Charges From Taxes On Billing Statements.”287

       The Code has been a positive step in customer service and demonstrates the states
willingness to work with the industry and apply a light regulatory touch. Cell phone carriers do
                                              - 24 -
not have to agree to follow the Code but the FCC requires carriers to adhere to the Code as a
condition for wireless ETC designation. For those that agree to adhere, penalties for non-
compliance are minimal.

               2.     Assurance of Voluntary Compliance

        In July 2004, state Attorneys General from Alabama, Arkansas, Colorado, Delaware,
Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan,
Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North
Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Tennessee, Texas, Virginia,
Wisconsin, and Wyoming entered into an Assurance of Voluntary Compliance with Cingular
Wireless LLC, Sprint Spectrum L.P. and Verizon Wireless, and to settle inquiries involving
allegations that representations made by each carrier violated the consumer protection and trade
practices statues in each of the respective states.

        The Attorneys General accepted terms of assurance including agreements for disclosure
of material rates and terms during a sales transaction, coverage, cancellation periods for wireless
service, advertising, disclosures of taxes and surcharges on consumer bills, consumer inquiries
and complaints, and compliance procedures.

               3.     Cooperative Agreements

       Several states have established cooperative agreements with wireless companies to
address consumer issues and complaints. Such arrangements typically provide a channel of
communication for states to work with wireless providers to handle specific constituent
complaint matters.

               4.     State Actions

        States have attempted a variety of approaches to address perceived concerns with regard
to the wireless industry. Often times the actions have been instigated through the State
legislative process. For example, in 2004, Minnesota enacted the Wireless Consumer Protection
Act (Act).288 The Act requires wireless telephone carriers doing business in Minnesota to: (1)
give consumers notice prior to making a proposed material change in their contract and (2)
obtain consumers’ affirmative consent to the change.289 The Act was intended to ensure that
wireless customers were given notice of and the opportunity to consent to substantives changes
in their wireless contracts. Shortly after enactment the wireless industry successfully filed a
lawsuit seeking to invalidate it.290

        Sometimes, the action has taken place at the regulatory or administrative level. For
example, the California PUC (CPUC) adopted a new Consumer Protection Initiative decision in
March 2006. In adopting this decision, the CPUC focused on its two core competencies: (1)
consumer education on the changing competitive marketplace and (2) enforcement of consumer
protection laws and rules. The decision created a new CPUC-led telecommunications consumer
education program (see that will provide information in 12 languages to
reach out to California consumers. The CPUC's education content includes discussion of
consumers’ rights and freedom of choice principles plus specific information on how to avoid
being a victim of consumer fraud (e.g. slamming and cramming). The website also informs
                                              - 25 -
consumers where to report complaints and fraud clearly. The consumer education initiative
launched in late June 2006, and over 8,300 hits to the website were recorded
on the first day alone. In this consumer education initiative, the CPUC has partnered with the
phone carriers, dozens of community-based organizations, and consumer groups to draft the
content of the educational materials collaboratively. In addition to the website, this group is
voluntarily distributing the consumer educational information through brochures, posters, public
service announcements, bill inserts, free text messages, and other media outreach efforts.

        The March 2006 decision also enhanced the CPUC’s ability to enforce laws and rules in a
timely and effective manner by creating a special Telecommunications Consumer Fraud Unit;
expanding its toll-free hotline to cover allegations of fraud; and increasing cooperation with
other law enforcement agencies such as the Attorney General and District Attorneys. In order to
ensure that the needs of non-English speaking populations in particular are protected, the
decision further directed CPUC staff to draft a report on in-language practices and any special
problems faced by consumers with limited English proficiency. Four statewide public
participation hearings and two workshops were held with the report received in October 2006.
An Order Instituting Rulemaking and proposed rules as to in language practices involving
telecommunications (both wireline and wireless telecommunications services) was issued on
January 14, 2007.

        The CPUC decision also adopted strengthened cramming rules, which apply to all
charges (whether communications or non-communications charges) placed on a consumer’s
phone bill by any company. These cramming rules provide that a phone company cannot bill a
customer for any unauthorized charge, even if the phone company did not originate the disputed
charge. These rules further state that a customer cannot be required to pay a disputed charge or
associated late charge while the phone company is investigating a complaint. According to the
rules, any such investigation regarding an unauthorized charge should be completed within 30
days of receipt of a customer complaint. Other rules – addressing investigatory efforts of CPUC
staff, worker identification, and Emergency 911 access – were broadened in order to extend to
wireless carriers.291

              5.      Court Decisions

        Thousands of wireless customers in 2000-2002 were knowingly sold wireless phones in
areas where there was no service coverage and then were told contracts could not be cancelled
without paying between $150 and $400 in early termination fees. A California court upheld the
state’s action against a wireless company, even though the company claimed the state had no
jurisdiction under “terms and conditions” to assist these customers.292 The 2003 CTIA
Consumer Code provides consumers the right to see coverage maps.

        As a result of state enforcement measures and actions coupled with competitive pressures
and advancing technology, there is evidence that the situation is improving. According to the
J.D. Power and Associates 2004 U.S. Wireless Regional Customer Satisfaction Index Study,
overall satisfaction with wireless service providers has increased five percent over 2003.293 The
FCC has also noted a decline in wireless complaints.

       The FCC’s Truth In Billing Orders have touched upon the issue of State’s jurisdiction
over wireless consumer issues while dealing with the broader issues regarding billing formatting
                                             - 26 -
and surcharges applied by all carriers. The FCC’s Truth In Billing Order (CC Docket No. 98-
170/CG Docket No. 04-208, Released March 18, 2005) removed the exemption for CMRS
carriers requiring that billing descriptions are brief, clear, non-misleading and in plain language,
but declined to prohibit non-government authorized surcharges, also known as discretionary
surcharges. In the case of wireless carriers, the FCC specifically prohibited States from
regulating or prohibiting line items or surcharges. However, in a decision released on July 31,
2006, a three-judge panel of the U.S. Court of Appeals for the 11th Circuit (Atlanta) ruled that the
FCC exceeded its statutory authority when it preempted states from requiring or prohibiting the
use of line items on wireless bills. The unanimous ruling by a three-judge panel means that the
Georgia Public Service Commission and similar commissions around the country can enforce
laws limiting what wireless providers can put on their bills.294

               6.      Conclusion

       Mobile communications devices are clearly a product that consumers desire. The
industry’s phenomenal growth is a testament to this, as is its high degree of competition in many
markets. In fact, it should be noted that many of the “complaints” that State officials hear
regarding the wireless industry are actually pleas for more service in hard to serve areas.

        At the same time, there is little doubt that the exploding popularity of wireless
communications has created growing pains. There are legitimate and real consumer complaints
regarding certain consumer marketing, billing and other industry practices. States have
addressed these concerns in a number of ways. The next section will discuss possible models for
future State actions as well as a proposed framework for an ongoing dialogue with the wireless
industry over these matters.


       A.      Consumer Protection Issues

       Under the federal Communications Act, States currently have the authority to regulate the
“terms and conditions” of wireless service and are preempted from regulating the rates and
market entry of wireless carriers (Section 332(c)(3), an amendment approved in 1993 as part of
the Omnibus Budget Reconciliation). This amendment clarified in federal law that States have
no authority over the regulation of entry and rates, but would preserve authority over so-called
terms and conditions, which is a dual-jurisdictional approach. As previously noted, States took a
decidedly hands-off approach to regulation until an upsurge in complaints beginning in 2000.
Since that time, States have approached the problems in a variety of ways, including through
attorneys generals offices, state public utilities commissions, legislatures and courts.

        Throughout the last year of the 109th Congress, significant discussion was generated
around proposed legislation (H.R. 5252, amended in the Senate) that would have preempted
States permanently in federal statute from enforcing provisions that affect the terms and
conditions of wireless service. NARUC opposed these efforts and the legislation ultimately
failed to move. While NARUC continues to believe that broadly preemptory language is not in
the best interests of consumers, it also understands the need for ongoing dialogue with industry
as the wireless market continues to evolve in an effort to foster a cooperative federal-state
                                               - 27 -
approach on issues such as technological innovation, network build-out, greater competition, and
educating and protecting wireless consumers.

        NARUC has recently passed two resolutions that are directly relevant to this subject. The
first concerns the overarching principles in an approach of “functional federalism”, in which
States emphasize their core competencies in areas such as consumer protection, highlighted in its
Federalism and Telecom White Paper approved at the Summer Meeting, 2005 (Resolution on
NARUC Telecommunications Legislative Reform). The second is a resolution (Resolution on
State Jurisdiction over Wireless Industry), adopted at the Summer Meeting, 2006, that expresses
its strong opposition to attempts to preempt its recognized authorities under “terms and
conditions” in federal legislation, while reiterating its willingness to continue a collaborative
dialogue with the wireless industry. Therefore, NARUC policies will continue to be guided by
the principles and statements included in these resolutions. NARUC believes that federal
standards or guidelines for consumer protection in wireless services may be an appropriate way
to help streamline rules that apply to wireless carriers, and address the primary concern
expressed by wireless carrier, specifically, the allegation that contradictory state consumer
protection laws unduly burden the industry with compliance costs.

        At the same time NARUC believes that there must be a role for State enforcement of
those standards. Experience has shown that state commissions and attorneys general are better
equipped to handle the myriad individual complaints in a case-specific, timely way as compared
to an overburdened Federal Communications Commission operating at a distance.

        Within this framework of “national rules, state enforcement,” there is a good deal of
debate that can and should happen between state and federal policy makers, consumer groups,
State attorneys general and the wireless industry. For example, the level of State discretion to go
above, deviate or innovate beyond federal rules would undoubtedly be an area of disagreement
amongst various parties. Nonetheless, NARUC supports and commits itself to a process that
allows a full vetting of these policy options and ideas in order to explore possible options to
achieve as much consensus as may be possible.

       B.      Wireless ETC Issues

               1.     ETC Background

        ETC is an acronym for eligible telecommunications carrier. An eligible
telecommunications carrier is a common carrier that has been designated to receive universal
service support. To be designated as an ETC, a company must file an application with the state
commission and the FCC and meet all State and federal ETC criteria. Depending on each State’s
jurisdiction, either the state commission or the FCC is responsible for reviewing applications for
ETC designation to ensure compliance with section 214(e)(1) of the Federal Act.295

       The amount of USF support going to competitive ETCs (CETCs) has grown
tremendously since 1999, and recently is a major cause in the growth in disbursements from the
High-Cost Fund. According to the Universal Service Administrative Company (USAC), USF
payments to CETCs have increased from $535,000 in 1999, to an estimated $1.1 billion by the
4th Quarter of 2006 (based on annualizing the 4th Quarter actual disbursements from USAC of
$286 million to the CETCs). For the 2007 year, it is expected that wireless CETCs will continue
                                              - 28 -
to receive an amount in the range of $1.1 billion, based on currently eligible carriers, and may
receive additional funds depending on the resolution of applications for ETC status before
various state commissions. On the other hand, it’s important to note the amount of contributions
to the USF that wireless carriers have made. Such contributions amounted to approximately $2.5
billion for 2006, based on 230 million subscribers and a safe harbor contribution rate of 28.5
percent (not based on actual USAC data). This amounts to slightly over $1.00 USF fee per
wireless customer, on an average basis nationally. With the proposed new safe harbor
contribution rate of 37.1 percent and a higher subscription base, it is reasonable to assume that
the contributions will increase further in 2007.

        A telecommunications company designated as an ETC must offer the services supported
by the federal universal service systems throughout its designated service area.296 The ETC must
offer these services using either its own facilities or a combination of its own facilities and resale
of another carrier’s services.297 If the company plans to offer the services solely through resale, it
shall not be designated an ETC.298

        The supported services and the associated charges must be advertised by the ETC
throughout the service area for which designation is received, using media of general
distribution.299 The ETC must also advertise the availability of Lifeline and Link Up services in a
manner reasonably designed to reach those likely to qualify for those services.300

               2.      FCC Report and Order released March 17, 2005

        In a Report and Order released March 17, 2005 (Report and Order, FCC 05-46), the FCC
adopted additional requirements that all ETC applications must meet to be designated an ETC by
the FCC.301 An ETC applicant must demonstrate: (1) a commitment and ability to provide
services, including providing service to all customers within its proposed service area; (2) how it
will remain functional in emergency situations; (3) that it will satisfy consumer protection and
service quality standards; (4) that it offers local usage comparable to that offered by the
incumbent LEC; and (5) an understanding that it may be required to provide equal access if all
other ETCs in the designated service area relinquish their designations pursuant to section
214(e)(4) of the Act.302 These requirements are mandatory for all ETCs designated by the
Commission, including those using wireless technologies.303 ETCs designated by the FCC prior
to the Report and Order were required to make such showings when they submit their annual
certification filing on October 1, 2006.304 The FCC also encouraged state commissions that have
chosen to designate ETCs under delegated power from the FCC to apply these requirements to
all ETC applicants over which they exercise jurisdiction.305 A number of state commissions
have adopted the FCC’s ETC designation criteria, and some have chosen to expand upon the
requirements by requiring additional criteria for ETC applicants in the areas of service quality
and reliability and consumer protection.

        In response to this important FCC Report and Order, the Telecommunications Committee
established a task force to examine the response of State commissions to this order and to
undertake a survey. The first ETC Task Force Report was published at the Summer Meeting in
2005, and has been updated several times since then. Forty States have responded to this survey,
and the survey demonstrates that state commissions have responded in various ways to the
“encouragement” of the FCC Order and its specific criteria. A number of State commissions
have adopted the FCC’s ETC designation and annual certification criteria by their own rules or
                                                - 29 -
by reference. Some states have modified the FCC proposed criteria and adopted them as rules.
Meanwhile, some states have chosen to expand upon the requirements by requiring additional
criteria for ETC applicants in the areas of service quality, network reliability and consumer

        Since the ETC Task Force has surveyed the specific issues in the Report and Order, this
report will not re-examine these issues again in great detail. In brief, the FCC Order requires that
the ETC applicants must demonstrate its commitment and ability to provide supported services
throughout the designation service area by providing service to all customers in its designation
service who request it, and by submitting a formal network improvement plan that describes how
universal service funds will be used to improve service and coverage. For the former, it
suggested several specific technologies and ways in which the ETC applicant should provide
service to such a requesting customer. For the latter, the FCC suggested that the ETC applicant
submit a five-year plan describing with specificity its proposed improvements or upgrades to the
applicant’s network on a wire center basis throughout the designated service area.

        The Report set forth detailed criteria in the following areas for the ETC applicant to
follow when requesting initial ETC designation or re-certification on an annual basis: a) ability
to remain functional in emergency situations; b) consumer protection; c) local usage; d) equal
access; and e) adequate financial resources. It also encourages the state commission to carry out
an analysis of whether or not the ETC designation will service the public interest, by examining
such factors as a cost-benefit study, potential for cream-skimming effects, and the financial
impact on the High-Cost Fund.

         Finally, the Order set forth augmented reporting requirements that are currently required
by the FCC to be submitted by October 1st annually, which are called certification and reporting
requirements. They include enhanced and detailed information in the following areas:
(1) progress reports on how the ETC met the goals outlined in its service improvement plan,
including the submission of maps and a wire center-level analysis; (2) information on service
outages, lasting at least 30 minutes that potentially affect at least ten percent of users or an E911
facility; (3) the number of unfulfilled service requests; (4) the number of complaints per 1,000
handsets or lines; (5) certification that the ETC is complying with applicable service quality
standards and consumer protection rules (such as the CTIA’s Voluntary Consumer Code, or a
state-level standards); (6) ability to function in emergency situations; (7) provision of a local
usage plan comparable to that offered by incumbent LEC; (8) provision of equal access to long
distance carriers in the event that no other ETC is providing it within the service area.

       C.      Interconnection Issues

        The Telecommunications Act of 1996 (Act) directed the FCC to take action to remove
statutory, regulatory, economic, and operational barriers to local telephone services competition.
In 1998, the FCC established a framework of national rules. The FCC's strategic goal for
competition is to ensure that there is a comprehensive and sound competitive framework for
communications services. One of the objectives of the FCC has been to facilitate a more
effective wholesale market through interconnection policy and other competition-related rules

       For a wireless telecommunications company, interconnection means the linking of its
wireless network to the network of a local exchange company, either directly or indirectly, for
                                               - 30 -
the exchange of traffic. Compensation among companies is for transport and termination on one
carrier’s network of traffic that originates on the network facilities of the other carrier.

         Each telecommunications carrier must interconnect directly or indirectly with the
facilities and equipment of other telecommunications carriers in conformity with the terms of
Section 251(a) of the Act. Incumbent local exchange companies (ILECs) may request
interconnection with the local exchange network from a CMRS provider and vice-versa.
Carriers may invoke the procedures set forth in Sections 252 of the Act. Providers receiving
such a request must negotiate in good faith with the requesting carrier and must, if requested,
submit to arbitration.

        State commissions have significant roles concerning the interconnection of all carriers,
including wireless providers. Under Section 252(e) of the Act, interconnection agreements must
be approved by the State commission. Any party negotiating an interconnection agreement can
ask a State commission to mediate or arbitrate differences or open issues.

        Today, arrangements for direct or indirect interconnection of wireless facilities and for
the transfer of telecommunications between CMRS providers and local exchange companies
(LECs) are considered routine. However, CMRS/LEC intercarrier compensation issues for
transport and termination of traffic might resurface in the FCC’s intercarrier compensation

       D.      Public Safety and E-911

       911 is the official national emergency number in the U.S. and Canada. Dialing 911
connects you to a Public Safety Answering Point (PSAP) dispatcher trained to route calls to local
emergency medical, fire, and law enforcement agencies who can deliver help as quickly as

        Wireless has become a lifeline for people in emergency situations. Wireless users make
more than 224,000 calls to 911 every day – more than 70 million calls a year – to call for help, to
stop crimes, and to help others in need. Many 911 systems now automatically report the
telephone number and location of the 911 caller, a capability called Enhanced 911 or E-911.
Wireless carriers can deploy technology to provide the latitude and longitude of the 911 caller
within specific accuracy requirements.

               1.     FCC Wireless 911 Initiatives

         The Wireless Communications and Safety Act of 1999 (911 Act) charges the FCC with
facilitating the implementation of end-to-end emergency response at the state and local level.
The FCC’s role is limited to providing support and does not authorize it to regulate statewide
plans. The FCC adopted wireless 911 rules aimed at improving the reliability of wireless 911
services and identifying the location of wireless 911 callers to enable emergency response
personnel to provide assistance more quickly. The FCC’s wireless 911 rules apply to all cellular
licensees, broadband Personal Communications Service licensees, and certain Specialized
Mobile Radio licensees.

                                              - 31 -
        The FCC’s June 12, 1996 order in Docket No. CC Docket No. 94-102 required that
wireless carriers transmit all 911 calls to a PSAP, regardless of whether the caller subscribes to
the carrier’s service. The order also required that wireless carriers provide location information,
a capability referred to as Automatic Location Identification (ALI), in a two-phase plan.

       Under Phase I, wireless carriers were required to provide a callback number for the
handset placing the 911 call and report the location of the cell tower that received the call.
Compliance with Phase I was required within six months of a valid request by a PSAP, or April
1, 1998, whichever was later.

       Under Phase II, wireless carriers are required to begin providing the latitude and
longitude of the caller with specific accuracy requirements. Carriers have the option to provide
this ALI information by deploying location information technology in their networks (a network-
based solution), Global Positioning System (GPS) technology in the subscribers’ handsets (a
handset-based solution), or a combination of location technology in both the network and
handsets (a hybrid solution).

        The 1996 order required compliance with Phase II rules within six months of a valid
request by a PSAP, or September 1, 2003, whichever is later. Also, wireless carriers subject to
the rules were directed to report their Phase II plans, including the technologies they plan to use,
by November 9, 2000. The Phase II reports from carriers with nationwide footprints (Tier I
carriers) – that collectively serve over 78 percent of the nation’s mobile telephone subscribers --
included specific Phase II compliance plans requiring certain relief from specific provisions of
the Phase II rules. The FCC responded by allowing Tier I carriers – AT&T Wireless, Cingular
Wireless, Nextel Communications, Sprint PCS, Verizon Wireless, and T-Mobile f/k/a
VoiceStream Communications – to commit to individual compliance plans, but all of these
carriers have committed that their plans for handset-based solutions will be fully implemented no
later than the end of the year 2005. Tier I carriers choosing handset-based location solutions
must provide the location of wireless 911 calls with an accuracy of 50 meters for 67 percent of
calls and 150 meters for 95 percent of calls. Carriers using a handset-based solution also must
ensure that 95 percent of their customers have location-capable handsets no later than December
31, 2005.

       The FCC also received numerous requests for relief from non-nationwide CMRS
providers seeking additional time to comply with Phase II rules. These carriers claimed
technical problems and delays in distribution of network equipment and handsets in light of
vendors’ focus on filling orders from nationwide carriers. For non-nationwide Tier II (more than
500,000 subscribers) and Tier III (no more than 500,000 subscribers) CMRS providers, the FCC
adopted phase-in timelines, Docket No. FCC 02-210.

        Tier II carriers – ALLTEL, US Cellular, Western Wireless, Leap Wireless, Qwest,
Centennial Cellular, CenturyTel, Dobson, Triton PCS, American Cellular, Rural Cellular
Corporation, and Price Wireless – are required to report quarterly on their E-911 Phase I and
Phase II deployment. Tier III carriers were required to provide an interim report due August 1,
2003 concerning their E-911 deployment. Like Tier I carriers, the Tier II and Tier III carriers
who employ a network-based location technology are required to ensure that penetration of
location-capable digital handsets among its subscribers reaches 95 percent no later than
December 31, 2005. Once a PSAP request is received, Tier II and Tier III carriers must, within
                                               - 32 -
six months, install hardware as needed and begin delivering Phase II enhanced 911 service to the

        More recently, on March 22, 2005, the FCC order in Docket No. FCC 05-79 addressed
40 requests for relief from the Commission’s wireless E911 Phase II requirements filed by or on
behalf of small wireless carriers. The petitions fell into six categories: (1) carriers deploying a
handset-based solution in conjunction with a CDMA upgrade; (2) carriers electing a network-
based solution; (3) carriers operating roaming-only networks (carriers’ carriers); (4) carriers
electing a handset-based solution in conjunction with a GSM upgrade; (5) AMPS/TDMA carriers
electing a handset-based solution; and (6) other requests. In individual cases, the FCC extended
the December 31, 2005 deadline to ensure ninety-five percent penetration among their
subscribers of location-capable handsets. The FCC denied a request for long-term relief from the
Phase II rules for carriers operating roaming-only networks and serving as a “carrier’s carrier.
The FCC denied a request for general relaxation of the Phase II requirements for smaller wireless
carriers filed by the Rural Telecommunications Group. The FCC required each Tier III carrier
that was granted individual relief to file an interim status report with the FCC on September 1,

        It is important to note that the December 31, 2005, date primarily requires carriers
choosing a handset-based Phase II solution to ensure that at least 95% of their subscribers have
location-capable handsets. The FCC has no jurisdiction over PSAPs, and there is no
corresponding requirement that PSAPs actually be able to receive Phase II data by December 31,

       E.      Universal Service and Intercarrier Compensation

         A primer on the interplay between universal service policy and intercarrier compensation
as it relates to the telecommunications industry generally and the wireless industry specifically is
well beyond the scope of this paper. Volumes have been, and are written about these critical
topics which are very much at the front of the minds of federal and state policy makers.
NARUC, led by the Telecommunications Committee’s Intercarrier Compensation Task Force,
has been intimately involved in creating the forum where industry stakeholders have crafted a
reform proposal that has been presented before the FCC. Suffice it to say that questions of “who
pays for what” will be tremendously important to all of telecommunications and will be an area
of great interest to state regulators for the foreseeable future.


       A.      Overview

       Consumers, State regulatory commissions and providers share many common goals.
Two fundamental goals are (i) bringing state-of-the-art technologies to as many people as
quickly as possible and (ii) effectively resolving consumer issues.

        The remainder of the paper addresses the different ways states have approached these
goals. Section B below enumerates a number of “best practices” aimed at facilitating consumer
issues. Section C then examines several state regimes focused on the wireless industry.

                                               - 33 -
       B.     Sample State Best Practices

              1.      Communicating with Consumers

       Communication is a two-way street. Commissions need to listen to consumers and the
wireless industry; commissions can also provide the public and industry with valuable

        Good policy starts with a strong working knowledge of what consumers want, need and
expect from the wireless industry. Determining what consumers deem important and valuable
will likely vary considerably from place to place. For instance, one community may lack
coverage while another may need more capacity to handle increasing wireless traffic volume.
Basic analog voice service may be of importance in a rural area while another area may be more
interested in the latest applications.

       Consumers oftentimes see commissions as experts on telecommunications issues and an
important resource. Commissions can provide the public with information on topics like those
outlined in Subsection 3 below and other basic information like industry statistics, comparisons
of analog and digital technologies, differences among cellular and other wireless platforms,
buying considerations and other state, federal and company resources.

              2.      Establishing Dialogue with Providers

        Because State commissions typically have not regulated wireless providers economically,
they may not have the same sort of established relationships with the wireless companies that
they do with other telecommunications providers. Improved communications can yield
numerous benefits. While many of these are self-evident, the providers can supply important
information to commissions that may help to resolve consumer complaints, to analyze state and
federal policy proposals, to promote efficient and effective use of financial resources and to
disseminate information to the public.

       Oftentimes, the public affairs/regulatory personnel will be the appropriate point of
contact. However, especially when working on coverage, zoning and build-out issues,
commissions will need good contacts with the engineering/network side of the company. Also,
while under some corporate structures there may be duplication with the public affairs
department, commissions should work closely with the customer service personnel – especially
when resolving consumer complaints. Many state commissions already do so today.

              3.      Building Expertise within the Commission

        If a commission becomes more involved with wireless issues, it is critical to build the
commission’s expertise on a wide range of issues. Commissioners, analysts, attorneys and
consumer protection specialists will all need a good working knowledge of the wireless business
basics, including:

       •      Technology basics regarding towers, handsets and systems;
       •      System and network design;
       •      Build-out strategies and associated issues relating to costs and access to capital;
                                              - 34 -
       •       Industry and company-specific policy and regulatory approach;
       •       Consumer complaint processes;
       •       Marketing and advertising practices;
       •       Dealer/franchisee relationships

      Possible sources include wireless providers, industry associations, equipment
manufacturers, the FCC, universities, research groups, and other state commissions.

               4.     Resolving Consumer Contacts

        Commissions have considerable expertise and experience in resolving consumer issues.
Three examples of commission involvement are: (1) statutory-based, i.e. an explicit grant of
consumer protection functions; (2) ETC-based; states can use ETC designation and USF
certification as a way to, at a minimum, evaluate how well providers are complying with
reasonable requests for service, or as a way to possibly gain greater involvement in resolving
individual complaints; and (3) voluntary agreements with wireless providers for some state role
in addressing consumer complaints.

        As with other consumer issues, commissions will want to coordinate efforts with the
state’s Office of Attorney General, consumer counsels and the like, or with industry
organizations like CTIA – The Wireless Association.

               5.     Fostering Cooperation Among Interested Parties

       State commissions could seek out additional parties interested in the policies surrounding
the deployment of wireless technology.

        On the local level, these may include elected officials, businesspeople and economic
development experts, education professionals, public safety officials and members of the medical
community. If communities lack subject matter expertise, commission staff can help them
analyze wireless issues. Good examples might be why a provider needs a tower in certain
location or what the options for tower designs are. Commissions can provide local decision-
makers with contacts at the wireless providers as well. Obviously, commissions should be
sensitive that local governments, tribes and other entities may have primary responsibility for
zoning and other issues and may not wish commission involvement.

        In addition, as wireless carriers compete for limited capital funding to finance network
deployment, commissions should carefully consider the effects that their decisions and policies
might have upon investment in their states. In this regard, State commissions might also
consider consulting representatives of the financial markets and economists for advice on how
certain approaches might help or hurt investment.

         For the wireless providers, commissions can furnish important information regarding
state, tribal and local dynamics. This cooperative role can yield better results for all involved.

      Commissions should, as with traditionally regulated utility issues, work closely with the
Governor’s office, Office of Attorney General, State legislature, State agencies, State/local

                                              - 35 -
entities that use other telecommunications networks, Native American tribes, congressional
delegations, and federal agencies on a myriad of wireless topics.

       C.     State Case Studies

       This section examines several States’ policies and programs to encourage development of
the wireless industries in their states and how they address consumer interest issues.

       1.     Arizona

        In Arizona, legislation was enacted (SB 1486) in 2006 which limits the Arizona
Corporation Commission’s (ACC) jurisdiction with respect to wireless carriers. SB1486 states

       "...The commission may adopt or administer arbitration procedures to resolve
       complaints or disputes brought by a party against a telecommunications company,
       except that the Commission shall not subject a wireless provider to arbitration
       unless the wireless provider and customer consent in writing. This section does
       not prohibit the Commission from arbitrating disputes or complaints against a
       wireline service provider, involving telecommunications services contained in the
       bundle of services, to the extent the Commission has jurisdiction as authorized
       pursuant to this chapter."

       Currently, when the ACC Consumer Services Section receives a wireless complaint from
a consumer, it is referred to the contact provided by the wireless company addressed in the
complaint (to the extent company contact information has been provided to the ACC). An
attempt is then made to resolve the complaint on an informal level. The customer is also
informed they may also contact the FCC and is provided the FCC’s contact information.

              2.     California

       As discussed in a previous section, the California Public Utilities Commission (CPUC)
adopted a Consumer Protection Initiative in March 2006. A few of the CPUC’s more recent
actions that recognize the impact of, and/or promote, wireless technologies are highlighted

       Broadband over Power Lines

       In April 2006, the CPUC adopted a decision establishing a regulatory framework to foster
deployment of broadband over power line (BPL) services. The decision removes regulatory
obstacles to broadband infrastructure deployment and thereby promotes broadband competition.
Since BPL uses existing utility infrastructure, the decision adopts a streamlined environmental
review process to speed deployment. The decision covers all types of BPL technologies,
including those that utilize wireless links for portions of the network.

                                             - 36 -
       Universal Service

        In mid-2006, the CPUC opened two rulemaking proceedings to comprehensively review
its universal service policies. At a spring 2006 workshop, program stakeholders particularly
those in the deaf and disabled communities specifically requested access to wireless and
broadband devices to better meet their needs. However, many of the current programs are
restricted to landline phone services or equipment due to the date of the program inception when
other technologies were not available on a widespread basis.

        The first universal service rulemaking proceeding, launched May 2006, is focusing on
public policy programs (Lifeline, Teleconnect, Deaf and Disabled, Public Payphone Program)
and funding mechanisms. The second universal service proceeding, initiated in June 2006, will
focus on the California high cost fund that provides support to the four largest landline phone
companies in California. In 2007, it is expected that a third and final universal service
proceeding will be launched on the California High Cost Fund that provides support to small
rural ILECs.

       In both proceedings, the CPUC is exploring how to continue ensuring affordable and
widespread availability of high-quality telecommunications services in light of technological
innovations and increasingly competitive markets. In California today, there are more wireless
phones than there are wireline phones; with some consumers are “cutting the (landline) cord” in
favor of other technologies. This development of wireless and other new technologies such as
Voice over Internet Protocol (VoIP) and Wi-Fi/WiMAX raises questions for how the CPUC will
continue to meet the requirements put forth by the California Legislature, which called for the
CPUC to ensure the continued affordability and widespread availability of high-quality
telecommunications services to all Californians.

               3.     Florida

        The Florida Public Service Commission (FPSC) does not have jurisdiction over wireless
carriers. Florida law expressly provides that Commercial Mobile Radio services (CMRS)
providers do not fall within the definitions of a “public utility” or “telecommunications
company” that is regulated under Florida law.306

       The Florida Commission’s “hands-off” approach to wireless services has allowed
consumers to benefit from competition and has allowed the wireless industry to innovate to meet
customer’s multi-faceted needs.307 Wireless subscribers in Florida continue to increase yearly as
consumers enjoy the benefits of a competitive market for wireless service. Florida wireless
subscribership was 12.5 million at year-end 2005.308 With an express statutory exemption from
PSC jurisdiction, regulatory risk has been minimized, and carriers have shown an increased
willingness to invest in the state.

        As competitive markets continue to evolve, consumer satisfaction is critical to the
continued existence and growth of wireless carriers. Even though the Commission does not
have jurisdiction, Florida has an established, effective process for addressing customer complaint
issues cooperatively with the wireless carriers.

                                              - 37 -
       Roles of the PSC and the Department of Agriculture & Consumer Services

        In Florida, non-jurisdictional wireless complaints are generally routed to the Florida
Department of Agriculture and Consumer Services (the Department). The Department functions
as the State’s clearinghouse for consumer complaints. The Department assists consumers with
information, protection, and complaints, regardless of whether it regulates that particular
industry.309 While the Department has no jurisdiction over wireless carriers, they act as mediator
to get disputes between carriers and consumers resolved.

       Because the FPSC lacks jurisdiction over wireless providers, it does not initiate a
complaint process of its own and generally refers wireless consumer complaints directly to the
Department; however, the FPSC has one other noteworthy procedure to assist certain wireless
consumers. Many larger wireless carriers provide the FPSC’s Bureau of Complaint Resolution
with phone numbers of company employees who are designated to assist consumers who
contacted the FPSC with a wireless-related problem. These contact numbers are often referred to
as “escalation numbers.” If (i) the wireless consumer’s complaint involves a company that has
provided the FPSC with such an “escalation number” and (ii) the wireless consumer is willing to
work with the company, then the FPSC complaint analyst will offer the phone number to the
consumer. Otherwise, the FPSC refers wireless-related complaints to the Department, which
addresses the complaints as follows:

       Addressing the Complaint

       1.      If a wireless complaint is filed, the Department provides a copy of the complaint
               to the FCC. The FCC does not regulate contractual arrangements with cellular
               providers, but does handle complaints about wireless service.

       2.      The Department then attempts informal mediation to resolve the consumer’s
               dispute by providing the wireless carrier with a copy of the consumer complaint
               against them and asking them to provide input and comment regarding the

       3.      The Department then attempts to mediate the matter to a successful resolution for
               both parties. Often, the carrier will directly discuss the issue with the complainant
               to satisfactory conclusion.

       4.      If a solution cannot be found, the Department will document the complaint in its
               database and close the file.

       5.      If fraud or misrepresentation is found to be involved, then the Department may
               investigate further and turn over their findings to the Attorney General’s office.310

       In short, Florida is addressing wireless consumer issues through a mix of generally
applicable consumer protection law and interagency cooperation via the Florida PSC and the
Florida Department of Agriculture and Consumer Services.

                                              - 38 -
               4.      Iowa

        In October of 2006, Iowa adopted new eligibility criteria and annual reporting
requirements for ETCs. As a result, some wireless carriers that are CETCs will be required to
submit a two year network improvement and maintenance plan, progress updates on the plans,
coverage area maps depicting signal strength, information on calling plans and data on certain
service quality performance indicators. Only wireless carriers with ETC designation are subject
to these new rules. These new rules also require wireless CETCs to commit to complying with
certain minimum consumer protection standards based on the 2006 Cellular Telecommunications
and Internet Association’s (CTIA) Consumer Code for Wireless Service. These new rules
extend the Iowa Utilities Board’s complaint jurisdiction over wireless CETCs in order to protect
consumers in the ETC context and further universal service goals.

               5.      Nebraska

        The Nebraska Public Service Commission (NPSC) does not currently have statutory
jurisdiction over wireless carriers. The wireless industry was deregulated in Nebraska with the
enactment of LB 835 in 1987 prior to the widespread deployment of, and dramatic growth in
consumer preference for wireless service. While not regulating wireless carriers, the NPSC has
been taking complaints from customers regarding wireless issues since July of 2001. The two
categories in which most wireless complaints fall are in are billing and service issues. The billing
category includes early termination fees assessed by the carriers.

        As a general rule, the wireless carriers have been working together with the NPSC to
resolve these issues. NPSC Wireless complaint procedure: 1. Complaints are received via
telephone, online complaint form, fax, e-mail, or letter. 2. Once filed the complaint is added to
our Access Database to facilitate record keeping including tracking that a response is provided
by the carrier. 3. Provide information to wireless carriers by email or telephone call for
investigation and resolution. 4. Carrier has 5 working days to respond to the NPSC. Legislation
was introduced in the Nebraska Legislature this January (LB 330) which would delegate to the
Nebraska Public Service Commission limited authority to resolve disputes between wireless
telephone companies and consumers regarding billing and service agreements. The Nebraska
Public Service Commission (NPSC) does not have statutory jurisdiction over wireless carriers.

               6.      New York

       Cellular Mobile Radiotelephone Service, now known as Commercial Mobile Radio
Service, or CMRS, was first offered in 1981. Like its predecessor mobile services, it was treated
as a regulated telephone service. In 1993, the federal government preempted state and local
governments from regulating the entry of or the rates charged by any commercial mobile service
or any private mobile service.311 States retained an ability to regulate the other terms and
conditions of CMRS and to establish requirements for ensuring the universal availability of
telecommunications services.

       Under the Telecommunications Act of 1996 the States did gain responsibility for certain
aspects of wireless services.312 These responsibilities include the review and approval of
interconnection between wireless service providers and other telecommunications providers,
mediation and arbitration of interconnection disputes,313 access to telephone numbers,314 and
                                               - 39 -
certification of Eligible Telecommunications Carriers (ETC)315 to receive Universal Service
Fund High-Cost Support.316

        In 2005, the New York Public Service Commission (NY PSC), recognizing the
competitive state of the wireless market, approved the merger of Sprint and Nextel.317 Both
holding companies had subsidiaries that provided telecommunications services other than CMRS
or Private Communications Services.

       Since the 1997 suspension of Public Service Law, other government agencies have taken
various roles over wireless services. The State Attorney General and the Consumer Protection
Board take complaints concerning wireless services. The Consumer Protection Board maintains
a Do-Not-Call list for wireless service customers. Finally, the New York City Department of
Information Technology and Telecommunications has performed wireless service surveys and
provided coverage maps by company for public use.

        In its recent Competition III Order,318 the NY PSC found an interconnectedness of
telecommunications networks, plants, and users. An event on one platform often influences
other interconnected platforms and can adversely affect the public safety, health and welfare.
Accordingly, the NY PSC is considering consistent and voluntary outage reporting. Staff has
invited parties to discuss the issues of emergency outage reporting. The NY PSC has also
requested the filing of annual reports on network reliability by all telecommunications carriers,
including wireless service providers. A proceeding to consider changes to its service quality
regulations has been initiated.319

         Finally, in response to the competitive and partially unregulated nature of the intermodal
telecommunications market, the NY PSC called for the establishment of a consumer report.320
This report will be available on the NY PSC website and will include basic information about a
telecommunications company services, including wireless services. This information would be
provided on a voluntary basis by participating telecommunications companies. The report will
likely include descriptions of essential public safety and health protections (911 and E-911
availability, CALEA compliance, per call and all call blocking of caller ID information),
consumer protections (slamming and cramming protections, privacy policies, access to Relay
Services), consumer features (website access, directory listings, number portability) and how to
file a complaint. The NY PSC staff has invited parties to participate in developing this report.

               7.     North Carolina

        Intermodal competition has substantially changed the communications industry in North
Carolina. For the first time in history, North Carolinians have more wireless phones than wire
line connections. According to the FCC’s “Local Telephone Competition” report, the number of
wireless subscribers in the state rose to 5.36 million, while wireline connections declined to 4.99
million statewide, as of year-end 2004.

        Like many states, the North Carolina Utilities Commission (NCUC) does not have
jurisdiction over wireless carriers. N.C. General Statute, Chapter 62-3(23)(j) states that the term
“public utility” shall not include any person, not otherwise a public utility, conveying or
transmitting messages or communications by mobile radio communications service. Mobile
radio communications service includes one-way or two-way radio service provided to mobile or
                                              - 40 -
fixed stations or receivers using mobile radio service frequencies. Thus, the NCUC jurisdiction
does not include CMRS providers.

        Despite not regulating the wireless industry, North Carolina has in place a process to
resolve consumer complaints. When complaints regarding wireless carriers are reported to the
NCUC, they are directed to the North Carolina Consumer Services Division of the Public Staff,
which in turn refers consumers to the Attorney General’s (AG) Office. The NCUC does not
attempt to mediate wireless complaints and does not directly deal with the wireless carriers
regarding complaints against them. Rather, such complaints are handled by the state agency with
the jurisdiction over all consumer complaints.

        The AG’s office handles consumer complaints and provides consumer tips on its websites
to help assist consumers when dealing with businesses. If customers feel that a wireless
company has misrepresented its rates or other terms and conditions of its service, they can file a
complaint with the AG’s Consumer Protection Division, and the Division will work to resolve
the situation. In cases where there is a pattern of illegal business practices, the AG’s Consumer
Protection Division may also take legal action to enforce the law on behalf of the public. The
office cannot, however, represent individuals in their private legal disputes.

        The AG’s Consumer Protection Division also works to educate consumers so that they
can avoid problems from the start. They publish on their website consumer tips on a wide range
of topics, including wireless services.

               8.      North Dakota

         In addition to the wireless ETC, consumer protection, and interconnection issues handled
by many state commissions, the North Dakota Public Service Commission (ND PSC) has started
a wireless outreach initiative designed to assist wireless phone customers in the state. Through
it, the PSC is pursuing a voluntary initiative designed to serve the state’s wireless consumers.

        The Commission’s initiative consists of two programs: “Zap the Gap” and “Connecting
Consumers.” The “Zap the Gap” effort is designed to encourage wireless investment in the state,
especially underserved areas. The ND PSC collects information from consumers to determine
areas where there is demand but low wireless coverage. The information is forwarded to wireless
providers to help bring attention to areas needing service. ND PSC staff has created a
clearinghouse of planning information for wireless companies. The information includes
approximations of the number of wireless phones per capita in different counties in the state, lists
of suitable structures for wireless antennas, and consumer contact information that may help
wireless providers in their network planning. The ND PSC facilitates discussions between
communities that want wireless service and providers operating in the state.

        “Zap the Gap” also identifies strategies to advocate for North Dakota’s interests in
wireless matters with other government agencies. Many of the decisions that affect wireless
investment in North Dakota are made at the federal level. This component of the initiative targets
federal rulemakings and opportunities with the FCC, Rural Utilities Service and other state
commissions. One such recent example was the successful effort to lobby for the resolution of
cell tower permitting delays at the FCC.

                                               - 41 -
        The “Connecting Consumers” effort is designed to help consumers with wireless
questions and concerns that they may have with their current services. The PSC established an
information center on its webpage for consumers wanting to learn more about wireless issues.
The Commission has also commissioned an e-mail address – – for consumers
wishing to contact the ND PSC with questions and concerns over wireless phone issues. Such
efforts complement general consumer protection authority provided by the state’s Attorney

       In 2005, the ND PSC, in cooperation with the Bismarck-Mandan Chamber of Commerce,
hosted a statewide conference on wireless telecommunications. The event brought hundreds to
Bismarck and helped focus attention on the challenges and potential of wireless technologies in
rural America.

              9.      South Dakota

        Former South Dakota Public Utilities Commission Chairman (SD PUC) Bob Sahr started
with a simple concept in 2002: Ask the State’s consumers for their thoughts on wireless
services. The overwhelming response was to improve cell phone coverage in rural areas. The
public knew wireless technology was a critical piece of community infrastructure – important to
public safety, economic development and quality of life.

        In 2003, the SD PUC turned this input into action. It developed an innovative approach
to facilitate the state’s wireless build-out: Open a proactive dialogue with the providers, build
staff expertise on wireless technology and work with local communities to help them bring
wireless services to town.

        Letters, e-mails and petitions flowed in from towns interested in improved wireless
service. Communities offered city water towers, grain elevators, county courthouses and rural
water towers as possible cell sites. Grass-roots meetings were held in dozens of towns. The SD
PUC hosted the South Dakota Wireless Conference, with a keynote by fellow South Dakotan and
current FCC Commissioner Jonathan Adelstein, focusing on how to bring wireless technology to
the state’s consumers faster.

       The wireless providers responded. In 2004, Cellular One constructed 25 new towers in
South Dakota; Verizon Wireless 14. Many of these towers were located in communities that
previously had no wireless services. Beyond improving coverage, the SD PUC staff and the
wireless providers work together to resolve consumer complaints on issues like false roaming
charges, dropped calls, analog versus digital questions, lack of system capacity and billing

              10.     Tennessee

        The Tennessee Regulatory Authority (TRA) does not have statutory jurisdiction over
wireless carriers. Tennessee Code Annotated, Chapter 65-4-101(a)(6)(F), with a limited
exception, exempts from regulation as a public utility any entity “offering domestic public
cellular radio telephone service authorized by the Federal Communications Commission.”

                                             - 42 -
        The major wireless providers all serve customers in Tennessee. Over the years, wireless
carriers have invested billions of dollars to improve wireless services in Tennessee, and continue
to invest several hundred million dollars every year. Wireless is also a major source of jobs for
Tennessee, directly employing about 8,000 people and indirectly employing many more.

       The wireless industry has been deregulated in Tennessee since the mid-1980s, when the
second wireless carrier began offering service in the state. Tennessee has since become one of
the most vibrant and competitive markets in the nation. While the Tennessee Legislature does
not regulate wireless pricing, it does look at certain service-related issues. For example, last year
Tennessee enacted a state law requiring cellular companies to provide a 10-day cancellation

         As a general rule, the TRA does not handle complaints on wireless carriers as the
applicable statute does not provide it with jurisdiction. However, an established process is in
place to ensure that customer issues are addressed. The TRA will typically refer a complaint to
the carrier, so that the carrier can attempt to resolve the matter. Further, if the wireless complaint
involves issues of fraud and false advertising, then the matter will be referred to the Tennessee
Division of Consumer Affairs (TN DCA). Created in 1977, the TN DCA works to enforce the
state Consumer Protection Act and assist consumers and businesses affected by unfair business
practices. The TN DCA coordinates mediation between consumers and businesses, and publishes
a list of businesses that fail to address complaints.321

       The TN DCA Process for Complaints

       1.      To get a wireless complaint handled, the customer must live in Tennessee and
               must complete a written complaint form.

       2.      A file of the complaint is created, and the file is assigned to a specialist.

       3.      The specialist will send a copy of the complaint to the business, and the business
               will have 15 days to respond.

       4.      TN DCA will work with both the business and the consumer to resolve the
               complaint. If necessary, TN DCA will forward complaints to other agencies,
               including the Office of the Attorney General of the State of Tennessee.

       In Tennessee, consumer complaints for wireless service continue to be low. Since last
year, Tennessee has had only 237 wireless complaints - ranging from not getting service to
merger service problems. In addition, wireless carriers appear to have successfully responded to
consumer complaints. To improve service, wireless carriers have hired more people, enhanced
coverage by adding new towers, and provided much more information to educate consumers.

       Competition may also serve as motivation for wireless providers to continue to provide
enhanced customer service. In Tennessee, 93% of consumers can choose from among 5 or more
wireless carriers. Thus, competition provides an additional incentive for wireless carriers to
continue to improve its services to meet customers’ demands.

                                                - 43 -
               11.     Texas

        The Public Utility Commission of Texas does not have jurisdiction over wireless carriers.
Texas law expressly states that providers of commercial mobile services are not subject to
regulation by the Texas Commission.
       The one exception to this general rule is in the area of the Texas Universal Service Fund
(TUSF). Under state law and the Commission’s rules, wireless carriers are subject to assessments
to support the TUSF. Currently, that assessment is five percent of total taxable intrastate
telecommunications receipts.
        Wireless carriers also are eligible to apply for designation as an Eligible
Telecommunications Provider (ETP) and to receive reimbursement from the TUSF for providing
service in high-cost areas. Currently, two wireless carriers have been granted this status in Texas.
The Commission has also been delegated authority by the FCC to designate Eligible
Telecommunications Carriers for purposes of the Federal Universal Service Fund.
        The Customer Protection Division of the Public Utility Commission of Texas does not
have jurisdiction over wireless customer complaints. Several of the wireless carriers in Texas
work with the division to provide better service to their customers. The Call Center staff gives
the customer the option of filing their complaint with the FCC or calling an executive number
with the participating wireless company that will allow the company one last opportunity to
resolve the customer’s issues before a complaint is filed with the FCC. In certain cases the staff
will contact the regulatory staff of the wireless carrier to alert them of a customer issue and
recommend that they contact the customer immediately.

                 12.   Virginia

       In the 2006 session of the Virginia General Assembly, legislation was introduced which
would have given the Virginia State Corporation Commission jurisdiction over wireless
companies. The exceptions to this renewal of State authority would have been those issues for
which States were already pre-empted (i.e., rate setting, entry requirements, and tower siting).
The legislation did not pass, but that did not end the legislative interest in the Virginia
Commission’s role in wireless complaint resolution.

         At the request of the patron of the legislation, we contacted wireless companies and
obtained their voluntary agreement for the Virginia Commission staff to handle complaints from
wireless customers. The program was coordinated with Virginia's Department Agriculture and
Consumer Services, which is the clearing house for other than utility complaints in Virginia and
formerly received such complaints to a limited degree. It took effect in mid-April 2006 and has
been met with overwhelming success, thanks largely to the cooperation of wireless providers.
From the program’s inception through the end of 2006, we resolved some 500 complaints (10%
of total complaints taken over the same time period) which returned approximately $90,000 to
consumers in the form of bill credits. This was accomplished without any advertising other than
some information contained on our website which follows :

                                               - 44 -
                                            * * *

       While consumer complaints will continue to exist, decision makers on both the private
and public sides are pursuing cooperative approaches to ensure that such needs are addressed
without excessive regulation that would impede wireless innovation and competition.         An
accessible avenue for complaint resolution, mediation and disposition is an important component
in making competition work. States, as the “laboratories of democracy,” are the ideal place to
experiment with different approaches to new marketplace issues. The preceding examples show
how cooperation between different State agencies and the federal government and the industry
can provide citizens with such an avenue for resolving both complaints and misunderstandings.

                                            - 45 -
  “Understanding Wireless Phone Coverage Areas,” FCC Consumer Facts,
  “Understanding Wireless Phone Coverage Areas,” FCC Consumer Facts,
  “Understanding Wireless Phone Coverage Areas,” FCC Consumer Facts,
  “Understanding Wireless Phone Coverage Areas,” FCC Consumer Facts,
  “Understanding Wireless Phone Coverage Areas,” FCC Consumer Facts,
  Significant statistical information regarding wireless broadband deployment in each state is available through the
FCC’s semi-annual Form 477, Local Competition and Broadband Reporting. All wireless providers offering
broadband service, like other providers of broadband services, must file the Form 477 twice annually regarding their
broadband service offerings. Most, if not all wireless broadband providers, file the Form 477 twice annually
regarding their broadband service offerings. Most, if not all wireless broadband providers, file the Form 477 report
with the FCC on a confidential basis. However, state utility commissions may obtain provider-specific information
regarding filed by providers in their respective states provided that the state commission has protections in place to
preclude disclosure of any confidential information 47 C.F.R. § 43.11(c).
  Ray, Tiernan, “Wi-Fi’s Promise may elude investors,” Barron’s Online, September 26, 2005.
  In its Eleventh CMRS Competition Report, the FCC observed that the deployment of next-generation networks
based on competing technological standards continues to be an important dimension of non-price rivalry in the U.S.
mobile communications market. Eleventh CMRS Competition Report, ¶ 3. Mobile data providers have
progressively introduced a wide variety of mobile data services and applications, such as over the air music
downloading services for mobile phones; high speed wireless Internet access services for laptops, and video services
enabling customers to watch video clips of television shows, sports, news, weather, and other content on advanced
handsets. Id., ¶¶ 136-38.
   “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
   Wireless broadband technologies do not currently match the speeds offered by cable and DSL; however,
continuous technological advances are narrowing the gap on speed disparities.
   Ray, Tiernan, “Wi-Fi’s Promise May Elude Investors,” Barron’s Online, September 26, 2005.
   Municipal Provision of Wireless Internet, FTC Staff Report (Federal Trade Commission, Sept. 2006)
   Ray, Tiernan, “Wi-Fi’s Promise May Elude Investors,” Barron’s Online, September 26, 2005.
   Ray, Tiernan, “Wi-Fi’s Promise May Elude Investors,” Barron’s Online, September 26, 2005.
   Municipal Provision of Wireless Internet, FTC Staff Report (Federal Trade Commission, Sept. 2006)
   Tiernan, Ray, “Wi-Fi's Promise May Elude Investors,” Barron’s Online, June 28, 2005.
   Hotspot Statistics,
   Tiernan, Ray, “Wi-Fi’s Promise May Elude Investors,” Barron’s Online, September 26, 2005.
   “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
   WiMAX is a registered trademark term promoted by the WiMAX Forum, a group of wireless Internet hardware
and software providers that certify “802.16” products for network interoperability, Municipal Provision of Wireless
Internet, FTC Staff Report (Federal Trade Commission, Sept. 2006) at 9.
   “Wireless Broadband: High Speed Goes Mobile,” CTIA, March 2005.
   David Pringle and Don Clark, “Nokia, Intel Plan to Collaborate On Wireless Technology WiMAX,” Wall Street
Journal, June 10, 2005; Page B3.
   The Wireless Alphabet Soup,” CNET News, February 14, 2006.
   “WiMAX: Wireless Broadband for the World – An Interview with Jim Johnson,”
   David Pringle and Don Clark, “Nokia, Intel Plan to Collaborate On Wireless Technology WiMAX,” Wall Street
Journal, June 10, 2005; at p. B3.
   Bill Alpert, “WiMax’s Strong Signal,” Barron’s Online, July 4, 2005.

                                                       - 46 -
   Sprint Nextel Announces 4G Wireless Broadband Initiative with Intel, Motorola and Samsung”
   Bill Alpert, “WiMax’s Strong Signal,” Barron’s Online, July 4, 2005.
   Definition of local-area network,
   Ray, Tiernan, “Wi-Fi’s Promise May Elude Investors,” Barron’s Online, September 26, 2005.
   “What is EVDO,”
   Chris Davey, “CDMA2000 1xEV-DO: Affordable Wireless High Speed Data Today,” Qualcomm, January 24,
   Chris Davey, “CDMA2000 1xEV-DO: Affordable Wireless High Speed Data Today,” Qualcomm, January 24,
   Ultra Wideband definition,,,sid40_gci213243,00.html.
“Ultra wideband broadcasts digital pulses that are timed very precisely on a carrier signal across a very wide
spectrum (number of frequency channels) at the same time. Transmitter and receiver must be coordinated to send
and receive pulses with an accuracy of trillionths of a second. On any given frequency band that may already be in
use, the ultra wideband signal has less power than the normal and anticipated background noise so theoretically no
interference is possible.” Id.
   Ultra Wideband definition,,,sid40_gci213243,00.html.
   Ultra Wideband definition,,,sid40_gci213243,00.html.
   See Judy Lam, “Ultrawideband Promises Boost to Wireless World,” Dow Jones Newswires, June 16, 2005; Page
   Judy Lam, “Ultrawideband Promises Boost to Wireless World,” Dow Jones Newswires, June 16, 2005; Page B4.
   Bluetooth Website, “How Bluetooth Technology Works,”
   Bluetooth Website, “How Bluetooth Technology Works,”
   Bluetooth Website, “How Bluetooth Technology Works,”
   Bluetooth definition,,,sid40_gci211680,00.html.
   Bluetooth definition,,,sid40_gci211680,00.html.
   GPS definition,,,sid40_gci213986,00.html
   RFID definition,,,sid7_gci805987,00.html.
   RFID definition,,,sid7_gci805987,00.html.
   RFID definition,,,sid7_gci805987,00.html.
   RFID definition,,,sid7_gci805987,00.html.
   RFID definition,,,sid7_gci805987,00.html.
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
( “Sometimes, the two can be combined. For example, a
fingerprint is physiological, but according to Joseph Kim, associate director of consulting at International Biometric
Group, the way that an individual places the finger on a sensor has a behavioral aspect, because of the amount of
pressure.” Id.
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,

                                                       - 47 -
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
   See 3G today website, 3G Technology,!ut/p/kcxml/04_Sj9SPykssy0xPLMnMz0vM0Y_QjzKLN4q3dAHJmMUbxBu
   See The sixteen cities include Austin, Texas;
Baltimore, Maryland; Boston, Massachusetts; Chicago, Illinois; Dallas, Texas; Houston, Texas; Las Vegas, Nevada;
Phoenix, Arizona; Portland, Oregon; Salt Lake City, Utah; San Diego, California; San Francisco, California; San
Jose, California; Seattle, Washington; Tacoma, Washington and Washington D.C.
   Janazzo, David, et al. "US Wireless Services, US Wireless Matrix 3Q 05," Merrill Lynch, November 28, 2005, at
Table 30 "Wireless Capital Expenditures."
   “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
   “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K. Dane Snowden, CTIA,
May 20, 2005.
   USA Today, June 10, 2005
   Michael Finneran, “Wireless Outlook for 2005” Business Communications Review, January 1, 2005; page 2.
   Ellen Sheng, “Sirius to Offer Music On Sprint's Network Of Wireless Phones,” Dow Jones Newswires, June 15,
2005; at p. D5.
   “Wireless Gaming Market to See Strong North American Growth,” RCR Wireless News, March 14, 2005.
   John Borland, “Napster, Ericsson join forces for mobile music,” CNET News.Com, June 14, 2005,
   Brian Bergstein, “Clocking in and out far from the office: Phone-based system simple but useful,” Associated
Press, June 17, 2005.
   “City Lets You Pay Parking Meters With Cell Phones,” Paul Eng, ABC News, June 16, 2005.
   “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
   “U.S. Consumer Mobile Data Forecast – More Diverse Revenue Streams in 2008,” The Yankee Group, 2004.
   “U.S. Wireless Data Revenue to Total $7.5 Billion in 2005,” Total Telecom, June 10, 2005.
   Erika Brown, “Coming Soon to a Tiny Screen Near You,”, May 23, 2005.
   Tiernan Ray, “Wi-Fi's Promise May Elude Investors,” Barron’s Online, June 28, 2005.
   Kharif, Olga “T-Mobile’s Trial Balloon,” August 14, 2006
   Briefing for Commissioner Philip Jones, “T-Mobile HotSpot@Home, November 27, 2006
    Tiernan Ray, “Wi-Fi's Promise May Elude Investors,” Barron’s Online, June 28, 2005.
    Seyfer, Jessie, “Television is coming to cell phones,” The Mercury News, October 3, 2005.
    Telephia, “From’Borat’ to the Discovery Channel – More than 2000 Video Titles are Available on the Third
Screen,” November 14, 2006.
    Seyfer, Jessie, “Television is coming to cell phones,” The Mercury News, October 3, 2005.

    Smartphone article, “The key feature of a smartphone is that one can
install additional applications to the device. The applications can be developed by the manufacturer of the handheld
device, by the operator or by any other third-party software developer.” Id.
    Zhang, Tong, “T-Mobile and RIM Announce Blackberry 7105t,” MobileTechReview, October 13, 2005; see also
“Research In Motion, T-Mobile in pact for Yahoo mail access,” MarketWatch, October 13, 2005.

                                                      - 48 -
    Zhang, Tong, “T-Mobile and RIM Announce Blackberry 7105t,” MobileTechReview, October 13, 2005.
    Zhang, Tong, “T-Mobile and RIM Announce Blackberry 7105t,” MobileTechReview, October 13, 2005.
    Martin, James, Mobile Computing: BlackBerry Alternatives, ComputerWorld, January 20, 2006
    Martin, James, Mobile Computing: BlackBerry Alternatives, ComputerWorld, January 20, 2006
    Martin, James, Mobile Computing: BlackBerry Alternatives, ComputerWorld, January 20, 2006
    Phonescoop website, Motorola ROKR E1,
    Slocombe, Mike, “Samsung GSM Handsets Offer MP3 Wireless Streaming,”, October 12,
2005, (
    Christopher Rhoads, “GoodLink Sets Sights on Blackberry,” Wall Street Journal Online, May 31, 2005.
    Mark Heinzl, “BlackBerry Maker's Profit Surges,” Wall Street Journal, June 30, 2005; Page B5.
    Christopher Rhoads, “GoodLink Sets Sights on Blackberry,” Wall Street Journal Online, May 31, 2005.
    Motorola To Acquire Good Technology,” Good Technology Press Release, November 10, 2006
    Christopher Rhoads, “GoodLink Sets Sights on Blackberry,” Wall Street Journal Online, May 31, 2005.
    Krazit, Tom, “Palm Unveils Wireless, Color PDAs,” IDG News Service, Wednesday, October 12, 2005,
    Krazit, Tom, “Palm Unveils Wireless, Color PDAs,” IDG News Service, Wednesday, October 12, 2005,
    Krazit, Tom, “Palm Unveils Wireless, Color PDAs,” IDG News Service, Wednesday, October 12, 2005,
    Krazit, Tom, “Palm Unveils Wireless, Color PDAs,” IDG News Service, Wednesday, October 12, 2005,
    Krazit, Tom, “Palm Unveils Wireless, Color PDAs,” IDG News Service, Wednesday, October 12, 2005,
    See Dell Press Release, Slimmer, Lighter and More Powerful Dell Notebooks Deliver Better Connectivity,
Security and Durability/Next-Generation Design, Features Driven by Business Customers Requirement (March 29,
    “First mini laptop phone introduced,” International Reporter, October 21, 2005,
( The phone may be used anywhere in the world. Id.
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
    Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
    Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
    Bluetooth website,
    Bluetooth website,
    Bluetooth website,
    Bluetooth website,
    Baig, Edward, “Kodak lets you snap then e-mail shots – without any wires,” USA Today, October 12, 2005.

                                                   - 49 -
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Kawamoto, Dawn, “HP expands digital-entertainment offerings,” CNET, January 4, 2006.
    Steve Schone, “The New ‘Anywhere, Anytime’ Sales Channel,” Computer Technology Review, October 1, 2004.
    Steve Schone, “The New ‘Anywhere, Anytime’ Sales Channel,” Computer Technology Review, October 1, 2004.
    Steve Schone, “The New ‘Anywhere, Anytime’ Sales Channel,” Computer Technology Review, October 1, 2004.
    Howard Buzick, “Near Future of Mobile Content; Handset is Cash Register,” E-Commerce Times, April 4, 2005.
    Howard Buzick, “Near Future of Mobile Content; Handset is Cash Register,” E-Commerce Times, April 4, 2005.
    Howard Buzick, “Near Future of Mobile Content; Handset is Cash Register,” E-Commerce Times, April 4, 2005.
    Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993, Annual Report and
Analysis of Competitive Market Conditions With Respect to Commercial Mobile Services, Tenth Report, (2005), at
p. 59, available at
    Howard Buzick, “Near Future of Mobile Content; Handset is Cash Register,” E-Commerce Times, April 4, 2005.
    Howard Buzick, “Near Future of Mobile Content; Handset is Cash Register,” E-Commerce Times, April 4, 2005.
    “NTT DoCoMo Develops FOMA 901iS ‘Mobile Wallet’ Series,” NTT DoCoMo Press Release, May 17, 2005.
    “NTT DoCoMo Develops FOMA 901iS ‘Mobile Wallet’ Series,” NTT DoCoMo Press Release, May 17, 2005.
    10th Annual CMRS Competition Report, REPORT (FCC 05-173), 9/30/2005.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
162, FCC Annual Report, September 29, 2006
    Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993, Annual Report and
Analysis of Competitive Market Conditions With Respect to Commercial Mobile Services, Tenth Report, (2005), at
p. 77, available at
    Wilson, Dan, “Compare T-Mobile TracFone and Virgin Prepaid Cell Phones and Services,” October 2, 2005,
    Id. at p. 76.
    Id. at p. 77.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993, Annual Report and
Analysis of Competitive Market Conditions With Respect to Commercial Mobile Services, Tenth Report, (2005), at
p. 57, available at
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    “Cell Phone Churn Increasing,” ConsumerAffairs, October 6, 2005,
(, citing the J.D. Power and Associates 2005
Wireless Retail Sales Satisfaction Study. Further, 20 percent of unsatisfied subscribers say they will ‘definitely’ or
‘probably’ switch carriers within next 12 months, an increase of 13 percent in 2004; and dissatisfied customers are
25 percent less likely to visit the same carrier again and 35 percent less likely to recommend the carrier. Id.
    Id. "The retail stores of wireless carriers face strong competition in the areas of price and promotions from
national electronic retail outlets such as Best Buy and Radio Shack, which offer wireless service.” Id. quoting Kirk
Parsons, senior director of wireless services at J.D. Power and Associates.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    “U.S. Wireless Data Revenue to Total $7.5 Billion in 2005,” Total Telecom, June 10, 2005.
    “Civic Network Television: Training leaders by satellite,” Benton Organization, December 5, 1996,

                                                       - 50 -
    Kingsbury, Alex, “Rural schools around the nation are expanding students' options with E-classes,” U.S. News &
World Report, October 18, 2004, (
    Id. Schools are also using wireless technology to instruct teachers. “The No Child Left Behind Act established
new certification standards for teachers and classroom aides by requiring them to be ‘highly qualified in the subjects
they teach.” This has burdened rural schools, where teachers often have limited access to continuing education. Id.
    Id. "We will begin classes to teach both the older and younger generations of our tribe - so that they can become
more familiar with the many opportunities available to them through the Internet." Id.
    Id. “Not only are Pala, La Jolla, and Rincon tribal members benefiting from high-speed Internet connectivity, but
soon all 18 San Diego County reservations will have a network connection - thanks to the recently formed Southern
California Tribal Chairmen's Association (SCTCA) Tribal Digital Village Network (TDVNet), which is funded by
Hewlett Packard.” Id.
    Paul Davidson, Inventive Wireless Providers Go Rural, USA Today, ( July 14, 2004).
    As of June 2006, there was total capital investment greater than $209.3 billion when summing cumulative and
incremental capital investment. As of June 2000, total cumulative capital investment was 76.6 billion. Therefore,
between the June 2000 and June 2006 period, capital investment equaled approximately $132.7 billion. Dr. Robert
Roche. “Wireless Industry Indices Report: Mid-Year 2006,” November 2006 at
    Appalachian Regional Commission, Wireless Broadband Access in Appalachia, (last visited Feb. 11, 2006).
    Posting of future kansas to (Oct. 10, 2005, 21:31 EST).
    Wireless Broadband Access in Appalachia, ARC Online Resource Center,
    Id. The wireless application was developed with help from the Carnegie Mellon University e-commerce
practicum. Id.
    Jane M. Sanders, “Virtual Voices,” Research Horizons, Winter 2005.
     “TTY Compatible Phones,”; see also “T-Mobile Accessibility Information,”
     “T-Mobile Accessibility Information,”
    “TTY Compatible Phones,”
    “TTY Compatible Phones,”; “T-Mobile Accessibility Information,”
    Fortt, Jon, “Sidekick, other devices benefit the deaf,” San Jose Mercury News, May 8, 2003,
    Kuchinskas, Susan, “Hiptop2 Device Honed for Deaf Market,”, September 16, 2004,
     Fortt, Jon, “Sidekick, other devices benefit the deaf,” San Jose Mercury News, May 8, 2003,

                                                       - 51 -
    TALKS by Cingular Wireless and the Nokia 6620;
    Owasys Wireless Devices,
    Owasys Wireless Devices,
    Owasys Wireless Devices,
    Owasys Wireless Devices,
    Owasys Wireless Devices,
    “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
    John Peifer, “Rehabilitation Engineering Research Center on Mobile Wireless Technologies for Persons with
Disabilities,” CTIA 2005 Wireless Accessibility Workshop.
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Gruman, Galen, “Wireless: Just what the doctor ordered,” CIO Magazine, August 1, 2003,
    Clark, Cheryl, “Diagnosis by laptop extends medicine’s reach,”, February 5, 2004.
    “The camera is so good, we can see the patient’s pupils and watch his eye movements.” Id.
    Mitchell, Mary, “Where military goes, so do the cellphones,” Chicago Sun-Times, September 13, 2005.
    Mitchell, Mary, “Where military goes, so do the cellphones,” Chicago Sun-Times, September 13, 2005.
    Reed, Keith Reed, “Satellite phones likely to remain niche player,” The Boston Globe, October 3, 2005.
    Reed, Keith Reed, “Satellite phones likely to remain niche player,” The Boston Globe, October 3, 2005.
    Reed, Keith Reed, “Satellite phones likely to remain niche player,” The Boston Globe, October 3, 2005.
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Globalstar Develops Wireless Emergency Management Communications System,” Telematics Journal, October
7, 2005, (
    “Business & Technology Trends Driving Voice, Video and Data Services,” Carolyn Brandon, CTIA, June 2005.
    “FBI Says Automotive Telematics Vital Tool,” Telematics Journal, October 19, 2005,
    “FBI Says Automotive Telematics Vital Tool,” Telematics Journal, October 19, 2005,
( “Although some capabilities are mounted to
vehicles, the FBI prefers the briefcase setup as it allows maximum flexibility use in any vehicle or anywhere in the
field.” Id.

                                                       - 52 -
    “FBI Says Automotive Telematics Vital Tool,” Telematics Journal, October 19, 2005,
( “Although some capabilities are mounted to
vehicles, the FBI prefers the briefcase setup as it allows maximum flexibility use in any vehicle or anywhere in the
field.” Id.
    CTIA Website, Industry Topics – Wireless Amber Alerts,
    CTIA Website, Industry Topics – Wireless Amber Alerts,
    OnStar website, OnStar Explained,
    OnStar website, OnStar Explained,
    OnStar website, OnStar Explained,
    OnStar website, OnStar Explained,
    Stolen Vehicle Recovery System,
    Millard, Elizabeth, “Biometrics for the Masses,” Top Tech News, October 17, 2005,
    “Impact of the US wireless telecom industry on the US economy,” David Lewin and Roger Entner, Ovum,
September 2005, at p. 6.
    Id. at p. 5.
    Id. at p. 10.
    Id. at p. 6.
    Id. at p. 6-7. “Customer Surplus” is determined by calculating the difference between what end-users are willing
to pay for a service and what they are actually paying for it.
    Id. at p. 5.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005; see also Roche, Robert F., Ph.D., “What’s Up With Wireless? Camp NARUC Michigan State
University,” CTIA, August 11, 2005, at Table “Licensed Wireless-Related Patents, 1973-2003.”.
    Id. at p. 19.
    Id. at p. 20.
    Id. at p. 7.
    “Innovation: The Keystone of the Commercial Mobile Wireless Experience,” CTIA Presentation to FCC, April
2004, (
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    “Expanding the Wireless Frontier: Shaping New Jersey’s Telecommunications Future,” K.Dane Snowden, CTIA,
May 20, 2005.
    Better Business Bureau Analysis of Cell Phone Complaints Reveals Root Causes of Customer Dissatisfaction,
issued May 4, 2004.
    Federal Communications Commission, Consumer & Governmental Affairs Bureau, Quarterly Inquiries and
Complaints Reports
    Cell Phone Service Bills, Long-Term Contracts, and Complaints, Christopher A. Baker, AARP Policy Institute,
June 2006.
    Truth-in-Billing Format, First Report and Order and Further Notice of Proposed Rulemaking, CC Docket No. 98-
170, ¶58.
    For the complete list of the 33 wireless carriers that have adopted the CTIA Consumer Code, please see:
    2004 MINN. LAWS 261, ART. 5.
    Cellco Partnership, et al. v. Hatch, (Eighth Circuit No. 04-3198, District Court. No. 04-2981).

                                                      - 53 -
    Questions on this initiative may be directed to President Michael Peevey, Commissioner Rachelle Chong or
Commissioner John Bohn.
    Pacific Bell v. PUC, issued June 20, 2006.
    J.D. Power and Associates Reports Satisfaction With Wireless Service Providers Increases Significantly as
Customers Report Higher Ratings in Call Quality and Cost-Related Attributes, Press Release, J.D. Power and
Associates, Sept. 9, 2004 (“J.D. Power and Associates Wireless Customer Satisfaction Study”).
    11th Circuit Decides FCC Was Wrong About Cell Phone Bills, Alyson M. Pulmer, Fulton County Daily
Reporter, August 15, 2006.
    See 47 U.S.C. §214(e)(1).
    47 U.S.C. §214(e)(1)(A). The services that are supported by the federal universal support mechanisms are: (1)
voice grade access to the public switched network; (2) local usage; (3) dual tone multi-frequency signaling or its
functional equivalent; (4) single-party service or its functional equivalent; (5) access to emergency services,
including 911 and enhanced 911; (6) access to operator services; (7) access to interexchange services; (8) access to
directory assistance; and (9) toll limitation for qualifying low-income customers. See 47 C.F.R. §54.101.
    47 U.S.C. §214(e)(1)(A).
    See 47 C.F.R. § 54.101(a)(5).
    See 47 U.S.C. §214(e)(1)(B).
    47 C.F.R. §§54.405(b) and 54.411(d).
    In the Matter of Federal-State Joint Board on Universal Service, Report and Order, CC Docket No. 96-45, FCC
05-46, Adopted February 25, 2005, Released March 17, 2005.
    Id. at ¶20.
    Fla. Stat. Ann. Sections 364.02 (2), (13)(c), 366.02(1).
    FPSC Report on Status of Competition in the Telecom. Industry, 2004.
    FCC report on “Local Telephone Competition: Status as of December 31, 2004”, July 2005.
    This occurred under the Omnibus Budget Reconciliation Act of 1993 (47 U.S.C. §332 (c)(3), as of June 30,
1993). The New York PSC retained its authority until June 18, 1995, when it allowed an FCC decision to deny a
waiver of the preemption to stand (PR Docket No. 94-108, Issued May 19, 1995). New York Public Service Law
§5(6) was enacted December 1, 1997 to suspend the application of Public Service Law to the provision of cellular
telephone services.
    "Wireless" includes CMRS, Private Radio Service, Personal Communications Services, Broadband Personal
Communications Services, and Paging Services.
    47 U.S.C. §251 and 252.
    Delegated by the FCC under 47 U.S.C. §251(e).
    47 U.S.C. §214(e)(2).
    While wireless providers contribute to the Federal Universal Service Fund, there is no such requirement to
contribute to the State Targeted Accessibility Fund. (See Cases 94-C-0095 and 28425, Opinion No. 98-10, issued
June 2, 1998).
    Case 05-C-0211 – Joint Petition of Sprint Communications Company L.P. on Behalf of Sprint Corporation and
Nextel Communications, Inc. for Approval of a Certificate of Merger, with Sprint Corporation being the Surviving
Corporation, issued and effective April 20, 2005.
    Case 05-C-0616 – Proceeding on Motion of the Commission to Examine Issues Related to the Transition to
Intermodal Competition in the Provision of Telecommunications Services. – Statement of Policy on Further Steps
Toward Competition in the Intermodal Telecommunications Market and Order Allowing Rate Filings, issued April
11, 2006.
    Case 06-C-0481 - Proceeding on Motion of the Commission Providing for the Examination of Service Quality
and Consumer Protection Regulations, Including Parts 602, 603 and 609 - Notice Concerning Service Quality and
Consumer Protection Regulations, issued April 21, 2006.
    Case 05-C-0616, Order, issued April 11, 2006.

                                                       - 54 -

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