Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C ) ) ) ) ) ) ) ) ) REPLY COMMENTS OF AT&T INC.

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1 Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C In the Matter of Development of Nationwide Broadband Data to Evaluate Reasonable and Timely Deployment of Advanced Services To All Americans, Improvement of Wireless Broadband Subscribership Data, and Development of Data on Interconnected Voice over Internet Protocol (VoIP Subscribership WC Docket No REPLY COMMENTS OF AT&T INC. David L. Lawson Christopher T. Shenk Brendan J. McMurrer SIDLEY AUSTIN LLP 1501 K Street, N.W. Washington, D.C Tel. ( Fax. ( Jack S. Zinman Gary L. Phillips Paul K. Mancini AT&T Inc th Street, N.W. Washington, D.C Tel. ( Fax. ( Attorneys for AT&T Inc. July 16, 2007

2 TABLE OF CONTENTS INTRODUCTION AND SUMMARY... 1 ARGUMENT... 4 I. THE COMMISSION SHOULD RETAIN THE CURRENT BROADBAND REPORTING THRESHOLDS AND SPEED TIERS II. THE COMMISSION SHOULD NOT IMPOSE NEW NATIONWIDE REQUIREMENTS TO REPORT ACTUAL BROADBAND CONNECTION OR AVAILABILITY COUNTS FOR EACH ZIP CODE OR OTHER SMALL GEOGRAPHIC AREA... 8 III. THE COMMISSION S CURRENT REPORTING REQUIREMENTS COLLECT SUFFICIENT INFORMATION ON THE AVAILABILITY AND ADOPTION OF WIRELESS MOBILE BROADBAND SERVICES IV. ALL INTERCONNECTED VOIP PROVIDERS SHOULD REPORT SUBSCRIBER COUNTS V. THE COMMISSION SHOULD RELY ON MARKET PRICING TRENDS, NOT PRICING DATA SUBMITTED BY INDIVIDUAL BROADBAND PROVIDERS CONCLUSION... 23

3 Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C In the Matter of Development of Nationwide Broadband Data to Evaluate Reasonable and Timely Deployment of Advanced Services To All Americans, Improvement of Wireless Broadband Subscribership Data, and Development of Data on Interconnected Voice over Internet Protocol (VoIP Subscribership WC Docket No REPLY COMMENTS OF AT&T INC. Pursuant to the Commission s Notice, 1 AT&T Inc. ( AT&T respectfully submits these reply comments. INTRODUCTION AND SUMMARY There is broad agreement that the Commission s Form 477 reporting requirements must strike a proper balance between requiring information that will truly enhance the Commission s ability to assess broadband adoption and availability and ensuring that those reporting requirements do not impose undue burdens that could retard the broadband deployment and competition that the Commission is charged with fostering. The comments confirm that while certain of the new reporting requirements proposed in this proceeding can be justified under this standard, others clearly cannot, particularly while the Commission s ability to protect commercially sensitive information from public disclosure remains under challenge. 1 Notice of Proposed Rulemaking, WC Docket No , FCC (rel. April 16, 2007 ( Notice.

4 First, the comments confirm that the Commission should retain the current broadband reporting thresholds and speed tiers. Customers continue to obtain broadband services with speeds near the 200 Kbps reporting threshold, and raising the reporting threshold would therefore both undercount broadband subscribership and availability and undermine the Commission s ability to perform trend analyses and comparisons. Nor has any commenter offered any sound basis for changing the existing speed tiers, which continue accurately to capture market-based distinctions between entry-level and higher-speed broadband consumer services. And the comments strongly confirm that any attempt to require providers to report the actual speeds customers experience with their broadband services would be impractical and extraordinarily burdensome, and would provide no useful information. Second, the Commission should postpone consideration of proposals to require dramatically more granular reporting of subscribership or deployment by zip codes or other small geographic areas. As the Commission has recognized, such carrier-specific data is highly competitively sensitive, and, if disclosed, would provide a detailed roadmap to each provider s deployment plans, competitive strategies and intelligence, and the pattern of its successes. But the Commission s ability to protect Form 477 data from disclosure under the Freedom of Information Act ( FOIA is currently under challenge in pending litigation. Given the Commission s proper recognition in the pending lawsuit that even existing reporting requirements would need to be reevaluated if carrier-specific Form 477 data were subject to FOIA disclosure, it plainly makes no sense for the Commission to consider far more granular reporting until those FOIA issues are resolved. If the Commission nonetheless chooses to revamp its reporting requirements while this litigation is pending, it should recognize, at a minimum, that legitimate confidentiality concerns preclude any requirement to report actual 2

5 subscriber counts at less than the state level, and that any more granular reporting requirement must be limited to tiered 5-digit zip code reporting within broad ranges. Third, the comments confirm that the Commission should retain its current requirements for reporting wireless broadband availability. All customers with broadband-enabled handsets have access to, and may use, mobile wireless broadband services on at least a per-usage basis, and therefore eliminating a portion of those customers from the Commission s data collection (in favor of the subset of customers with a monthly broadband pricing plan would arbitrarily exclude large numbers of consumers that do in fact have instant access to wireless broadband service. The comments further confirm that the Commission should not require wireless broadband providers to report more granularly how their customers use the broadband services available to them i.e., by reporting which customers have which types of pricing plans, download services at particular speeds, or have full Internet browsing capabilities. Such information would be extremely burdensome to produce without providing any useful information about deployment or availability, and the Commission rightly does not require wireline or other broadband providers to report any such information. Fourth, the commenters generally agree that the Commission should require interconnected VoIP providers to report their subscriber counts and what percentage of those customers are residential. The comments confirm, however, that, at least with respect to nomadic VoIP services, any further requirement to report the extent to which the VoIP service is provided in conjunction with a broadband facility owned by the same provider would be unworkable and would not provide useful information. Finally, the comments overwhelmingly confirm that the Commission should not require broadband providers to report service-specific pricing information. The broadband marketplace 3

6 is intensely competitive and already provides consumers with complete real-time information on the many competing providers unregulated broadband prices. Moreover, any service-specific, point-in-time pricing information collected through the Form 477 process would quickly be outdated and could not support any meaningful historical analyses, because price differences today reflect a broad array of customer-specific and service-specific circumstances that would be virtually impossible to reconcile. Of course, to the extent the Commission wishes to monitor broadband pricing trends at the macro level, there are myriad public sources of that data all of which unequivocally confirm that the Commission s deregulatory broadband policies continue to serve the public interest. ARGUMENT I. THE COMMISSION SHOULD RETAIN THE CURRENT BROADBAND REPORTING THRESHOLDS AND SPEED TIERS. The comments demonstrate that the Commission should retain the existing broadband reporting thresholds and should not attempt to make those thresholds more complex by adding additional tiers, automatic adjustments, or actual speed reporting requirements. Many commenters agree that the Commission should retain the current 200 Kbps reporting threshold. 2 Raising the threshold would arbitrarily undercount broadband subscribers and services, particularly first generation broadband services provided over new technologies, 3 undermine 2 See, e.g., AT&T at 7-8; CTIA at 13; CU at 34; CWA at 7; IUB at 4; ITIF at 3-4; NCTA at 11-12; NPM at 5; Sprint/Nextel at 7; TWC at 6; USTA at 14-16; Verizon at CTIA at 13 (changing these thresholds will distort measurements of the marketplace by ignoring the continued importance of first generation... broadband services ; NCTA at 12 ( raising the threshold could result in more areas of the country being considered unserved ; see also, e.g., TWC at 6 ( increasing the minimum threshold of 200 Kbps... would result in undercounting services that some consumers may regard as functional substitutes for higherspeed services ; AT&T at

7 the Commission s ability to engage in accurate trend analyses, 4 and impose unnecessary new burdens to modify broadband reporting systems and processes. 5 The comments likewise confirm that the first speed tier (200 Kbps to 2.5 Mbps should not be split into additional sub-tiers. 6 Indeed, that the proposals by supporters of such divisions are all over the map is itself stark evidence that there is no market-driven reason for such tier splitting. Verizon, for example, originally proposed dividing the first tier at 1 Mbps, 7 but now supports dividing it at 700 Kbps. 8 Other commenters propose subdividing the tier at 384 Kbps, 768 Kbps, 1.5 Mbps, and 3 Mbps. 9 One commenter even proposes creating 134 new sub-tiers. 10 None of this arbitrary tinkering with the reporting thresholds is remotely necessary, because the existing speed tiers continue to fit actual marketplace dynamics. Today s 2.5 Mbps threshold establishes a market-oriented dividing line between basic, entry-level broadband services, which typically offer maximum downstream transfer rates of less than 2 Mbps, and higher-speed consumer services, which typically offer downstream transfer rates of 3-6 Mbps. 4 See, e.g., Sprint/Nextel at 5 ( one significant benefit of retaining the current definition [of 200 Kbps] is it would allow continued and consistent tracking of broadband services using historic benchmarks ; TWC at 6 ( curtailing the reporting of such connections would make comparisons to prior periods more difficult, thus undermining the Commission s goal of tracking consumer uptake over time ; Verizon at 22, n.32 ( [r]etaining the 200 Kbps threshold will allow the Commission to track from a historical perspective the rate at which lower-speed broadband users migrate to higher speed subscriptions ; see also AT&T at See, e.g., Sprint/Nextel at 6 (such requirement may require carriers to modify the costly programs they already have developed to produce data for prior reports. 6 See, e.g., AT&T at 6-7; NASUCA at 12; NCTA at 12; Sprint/Nextel at 7; TWC at 6. 7 See also, e.g., CWA at 5; ITIF at 2; IUB at 4; NASUCA at 11; WCA at 4. 8 Verizon at See, e.g., APT at 3-4 (new tiers at 1 Mbps and 3 Mbps; ALA at 2 (a new tier at 1.5 Mbps; ITIC at 4 (new tiers at 384 Kbps and 768 Kbps; Vonage at 3 (new tier at 768 Kbps. 10 See CU at

8 Altering the speed tiers thus would both prevent the Commission from using historical data to make meaningful comparison, and significantly increase the burdens on service providers. 11 The record also demonstrates that there is neither a need for nor a practical means of implementing any automatic adjustment mechanism for the speed tier reporting thresholds. 12 No commenter even attempts to suggest a workable automatic adjustment approach. And it is far from apparent that the existing thresholds will need any adjusting in the forseeable future. The current tiers already track speeds up to 100 Mbps, and the existing 2.5 Mbps upper threshold for the first tier and 10 Mbps for the second tier provide ample headroom above typical transfer speeds to ensure that these dividing lines will remain meaningful even as transfer speeds continue to increase. The Commission remains free to modify the thresholds in the future if it becomes necessary to do so, but it is not necessary now. 13 Finally, the comments also confirm that the Commission should again reject proposals to try to measure actual data transfer speeds. 14 Such point-in-time measurements of individual users broadband experiences would not provide any meaningful data because the actual information transfer speed that a particular customer experiences at any time fluctuates and is a function of myriad factors, many of which are beyond the broadband service provider s control 11 TWC at 6; see also, e.g., NCTA at 12 ( We believe the Commission would do more harm than good were it to make significant changes to the tiers it uses for reporting purposes. Moreover, as Sprint points out, the line counts provided within each tier already are reported by technology, which provides the Commission an approximation of the available speeds. Sprint/Nextel at 7. See also AT&T at See, e.g., NASUCA at 12-13; Verizon at 17; TWC at 6; Sprint/Nextel at 7; ITIF at 4; WCA at See, e.g., ITIF at 4; NASUCA at 12; TWC at 6; Verizon at See, e.g., AT&T at 11-12; OPASTCO at 7-8; Sprint/Nextel at 6-7; TWC at 7; Verizon at 21. 6

9 and many of which are technology-specific. 15 Thus, any attempt to report actual speeds would inevitably produce a misleading picture of any given service s true capabilities and would necessarily result in apples-to-oranges comparisons among different technologies and providers that would not produce consistent and comparable industry wide measures of actual speed. 16 Further, the record confirms that any possible benefits of such new reporting requirements would be overwhelmed by the associated burdens See, e.g., Verizon at 21 ( Many factors, including circumstances outside of a provider s control, make it difficult to track achieved broadband speeds or even an average achieved speed ; TWC at 7 ( The actual speeds experienced by a customer at any given time are difficult to measure and problematic to report because actual speeds vary based on numerous factors, such as the number of users on-line in a given area and the applications and equipment used by the customer ; Sprint/Nextel at 6-7 ( For wireless providers, the speed is affected by the number of customers using the particular cell site at the same time, the applications they are using, and the distance of the user from the cell site, as well as other factors; OPASTCO at 7-8 ( OPASTCO is unaware of any rural ILEC that has this capability.... End users data speeds are influenced by many factors, such as network configuration, topography, network usage at a given moment, backbone choke points, and other considerations that are outside the provider s control. 16 AT&T at See also, e.g., TWC at 7 ( the reporting of actual connection speeds is unlikely to provide reliable information about the service providers network ; Verizon at (Verizon and Verizon wireless do not [even] possess the technical abilities to track and report the achieved speed of broadband users. 17 See, e.g., OPASTCO at 8 ( [t]he costs of acquiring this data would be great, and certainly far greater than the value it would provide the Commission ; Sprint/Nextel at 6-7 (measuring actual speeds would be not only time consuming, but also inexact and highly problematic ; TWC at 7 (measuring actual speeds are difficult and problematic ; Verizon at (obtaining actual speeds would be extremely difficult and costly ; AT&T at A few commenters propose a method for estimating actual speeds whereby broadband customers would connect to a web site that would estimate the speed of that customer s broadband connection to that web site. See, e.g., ITIF at 6; CWA at 9. AT&T does not oppose such tests per se or the Commission taking notice of such tests. However, as other commenters point out, these speed tests can be quite unreliable. The connection speeds depend on myriad factors e.g., the customer s equipment and applications, as well as the distance between the customer and the location of the equipment used to conduct the speed tests that cannot be accounted for in such web site speed tests. See, e.g., NCTA at 7-8; ITIF at 8. 7

10 II. THE COMMISSION SHOULD NOT IMPOSE NEW NATIONWIDE REQUIREMENTS TO REPORT ACTUAL BROADBAND CONNECTION OR AVAILABILITY COUNTS FOR EACH ZIP CODE OR OTHER SMALL GEOGRAPHIC AREA. There is no serious dispute that proposals to collect information regarding an individual broadband provider s subscribership or availability within specific geographic areas raise very serious confidentiality concerns. 18 Proposals to require reporting of the specific technologies used by each broadband provider and the specific number of subscribers to each of the broadband provider s services within small geographic areas would exponentially increase the granularity and competitive sensitivity of the information reported in Form 477. Such reporting would reveal the pace and pattern of each provider s deployment and provide a detailed provider-specific roadmap for its competitors to follow. As a result, public disclosure of such commercial secrets would force providers to constantly re-evaluate their strategic business decisions about where, when and how to deploy broadband services, thus significantly distorting competition and slowing the progress of broadband deployment. Unless and until the Commission s ability to protect such information from FOIA disclosure has been firmly 18 See, e.g., CBT at 3 (the information would be sensitive from both a security and competitive perspective; State of Ill. at 5 (recognizing that the number of subscribers in a given area should not be publicly disclosed; NTCA at 12 (explaining that [t]he Commission should not release the raw data garnered from Form 477 ; NCTA at 14 ( If such [Form 477] information were made public, it undoubtedly would be used by competitors in developing their own strategies to compete with other broadband providers. Such information would be valuable in providing both a snapshot of a competitor s network and services at a given point in time and, by looking at changes over time, a roadmap to strategic decisions made over a period of years ; OPASTCO at 3, n.6 (emphasizing the importance of maintaining the confidentiality of Form 477 reports. ; TWC at 5 ( Maintaining strict confidentiality will be all the more vital if the Commission requires submission of customer counts and related information on an even more granular basis ; Verizon at 15 ( if the Commission were to release this information publicly, the Commission would harm the reporting entities by enabling competitors to compete unfairly with this detailed knowledge of a particular provider s deployment and marketing strategies. 8

11 established, the public interest harm of potentially exposing this information far outweighs any potential benefits associated with obtaining this additional level of detail. The risk that such information, if reported to the Commission on Form 477, may be publicly disclosed is anything but speculative. Certain entities already have sought disclosure under FOIA of the information that is currently contained in Form 477, and whether the Commission will be required to disclose that information is pending before a federal district court. 19 In that proceeding, even with respect to the less granular data that providers report in Form 477 today, the Commission is strongly resisting disclosure on the ground that it is undisputed that the forms contain detailed and proprietary company-specific data regarding service providers business holdings, practices, strategies, and operations in the individual state markets, including information about their service offerings and locations, as well as their customer types and counts. 20 As the Commission has explained, disclosure would, inter alia, (1 allow competitors to determine particular areas where a service provider has or has not been successful in acquiring customers; (2 disadvantage new entrants in particular geographic areas by enabling existing providers to target win back efforts; (3 disadvantage new entrants by drawing the interest of additional new competitors to a particular geographic area; (4 reveal data regarding the technologies that a service provider uses; (5 enable competitors to identify and target a service provider s largest or most lucrative customers; and (6 provide competitors with 19 See Center for Public Integrity v. FCC, Civil Action, No , Complaint, at 3 (D.D.C. filed Sep. 25, Center for Public Integrity v. FCC, Civil Action, No , FCC Reply, at 2 (D.D.C. filed May 15,

12 information about market trends that would not be otherwise available through legitimate means. 21 A competitor [a]rmed with [Form 477 data]... could... alter its facilities deployment plans and thereby defeat any advantage [another provider] hopes to gain by deploying particular technology in a given market. 22 Further, a competitor could devise marketing strategies that seek to highlight perceived advantages it may claim to have over a particular technology [another provider] may be deploying in a particular market and a competitor could learn, on an aggregated basis, which technologies have found the most success in the market information that [other providers] ha[ve] gained only through participating in the market and that is extremely valuable in making deployment and investment plans on a prospective basis. 23 Given the indisputable sensitivity of the carrier-specific information presently provided in Form 477 and the current uncertainty as to whether it can be protected from public disclosure, 21 Center for Public Integrity v. FCC, Civil Action, No , FCC Reply, at 2 (D.D.C. filed May 15, Center for Public Integrity v. FCC, Civil Action, No , Joint Declaration of Mark Keiffer, Robert W. Quinn Jr., and Rick Welday, Jr. on behalf of AT&T et al., at 4 (D.D.C. filed Jan. 8, Id. at 4. See also Center for Public Integrity v. FCC, Civil Action, No , Joint Declaration of John A. Wimsatt, Larry J. Zeppetela And Thomas Y. Ikegami on behalf of Verizon, at 4-5, (D.D.C. filed Jan. 8, 2007 (information regarding the pace and pattern of Verizon s roll-out of this new [fiber] network would enable competitors to anticipate Verizon s moves and protect themselves against competition from Verizon in a targeted way, without engaging in the same business-wide price reductions and service improvements that they would have to make if they were competing without inside information and that, in turn, would cause Verizon substantial competitive harm in this vitally important area ; Center for Public Integrity v. FCC, Civil Action, No , Declaration of Kevin J. Albaugh on behalf of NPTC, at 2, (D.D.C. filed Jan. 8, 2007 ( [b]y utilizing the broadband data provided on Form 477,... competitors could identify areas where demand is highest, or where current service offerings would make NPTC most vulnerable to the introduction of new technology or aggressive marketing by a competitor and such information could be use[d]... to tailor their competitive strategies including marketing and infrastructure investment to compete unfairly against NPTC.. 10

13 the Commission should not at this time exacerbate the potential harms that would result from disclosure of such information by adding new, even more commercially sensitive reporting requirements to Form 477. Rather, the Commission should stay its hand until it is settled (in the pending litigation, including any appeals, or, if necessary, through legislative reform that carrier-specific Form 477 data is exempt from FOIA disclosure requirements. This does not mean that the Commission lacks resources to further investigate the nature of broadband deployment in relevant areas. 24 Foremost, the commenters agree that the Commission should rely, where appropriate, on commercial data sources that identify where within rural zip codes there are broadband services. 25 The comments further confirm that the Commission can and should rely on citizen self-reporting to identify areas with and without broadband service. 26 And, the comments confirm that the Commission should, where appropriate, coordinate with the private industry partnerships, such as ConnectKentucky, that have conducted detailed analyses of broadband availability in particular geographic areas. 27 If the Commission nonetheless were to determine that additional granular Form 477 reporting should be required notwithstanding the extraordinary harms that the Commission itself has identified from potential disclosure of such information, it should take aggressive steps to 24 IUB at 3 ( the data provided on Form 477 is sufficient to gauge general availability and deployment of broadband services ; see also, e.g., APT at 8 (supporting use of commercial information; CU at 37 (supporting self-reporting by citizens; Embarq at 14 (supporting use of commercial information; Mass/Maine at 4 (supporting use of commercial information; NASUCA at 19 (supporting use of commercial information and customer self-reporting; NPM at 8 (supporting use of commercial information and customer self-reporting; Verizon at 6-9 (supporting use of commercial information, coordination with private-state entities and customer self-reporting. 25 See, e.g., APT at 8; AT&T at 14-16; Embarq at 14; Mass/Maine at 4; NASUCA at 19; USTA at See, e.g., AT&T at 14-16; CU at 37; NASUCA at 20-21; NPM at 8; USTA at See, e.g., APT at 4-6; AT&T at 14-16; Verizon at 4-6; USTA at

14 minimize such harms. In particular, to the extent that the Commission seeks more geographically narrow reporting of subscriber line counts which are currently reported at the state level the Commission should not require broadband providers to report precise subscriber line counts, but should instead limit reporting to broad ranges within which the provider s subscriber line counts fall. 28 Under this approach, the Commission would, for example, require each broadband provider to report whether its broadband line count in a 5-digit zip code falls within the range of >0-20%, 21-40%, 41-60%, or greater than 60% of the total households in the zip code reported by the Census Bureau (or in some other readily available source identified by the Commission. While this information still would be extremely confidential and should never be disclosed, it would at least partially disguise the precise line counts of each carrier within individual 5-digit zip code areas. 29 Proposals to require any reporting below the 5-digit zip code level should be categorically rejected. 30 The Commission has consistently stressed that Form 477 reporting should rely[] as much as possible on... industry practices and collect data in a minimally burdensome manner. 31 Broadband providers necessarily maintain in billing or other systems 28 Accord N.J. Division of Rate Counsel at If the Commission does choose to expand its reporting requirements, the Commission should ensure that the data collection burden is minimized by allow[ing] an ample amount of time for compliance for the initial filing using a modified Form 477. NTCA at (proposing at least a one-year implementation period for the first Form 477 report. 30 IUB at 3 ( the data provided on Form 477 is sufficient to gauge general availability and deployment of broadband services ; Sprint/Nextel at 9 ( 5-digit zip code reporting is the appropriate level of detail. If the Commission requires broadband providers to submit subscriber line count information and as noted such information should be limited to ranges, not exact counts such information could eliminate the need to expand the data collection to a 9-digit zip code level. Comptel at Local Tel. Competition and Broadband Reporting, 19 FCC Rcd , 17 (

15 the 5-digit zip code associated with each subscriber, and there is therefore no other geographic classification system that offers the same comparability and administrative ease. 32 A 9-digit zip code reporting requirement, in contrast, would impose substantially greater burdens with few discernable benefits. The comments confirm, for example, that many broadband providers do not maintain 9-digit zip codes for a large portion of subscribers. For example, NCTA presents reports by numerous smaller broadband providers that [n]either [their] billing system nor... mapping system is currently set up to capture the 4 extra digits. 33 Larger carriers likewise do not collect 9-digit data for all of their customers. 34 Moreover, even supporters of 9-digit zip code reporting admit that such information is likely to be of limited use to the Commission. For example, although Time Warner generally supports the proposal to require reporting entities to submit all 9-digit zip codes they serve, it concedes that [s]uch designations change relatively often and have been criticized as failing to correspond to commonly recognized geographic boundaries. 35 As numerous commenters point out, therefore, graduating to nine-digit zip codes will offer little, if any, added clarity, and such information likely would only distort the picture of the availability of broadband services See, e.g., IUB at 3, Sprint/Nextel at NTCA at 5-9; accord OPASTCO at 5 ( [t]racking broadband by nine-digit zip code... would require rural ILECs to re-vamp their record keeping operations, since they do not generally utilize the plus 4 digits in their provision of services ; ACA at 4 ( [i]mplementing a 9-digit zip code system would be costly and provide no corresponding benefit for the operator or its customers ; Comptel at 4 ( 9-digit zip code level of geographic aggregation... could impose significant costs to some carriers, especially smaller entities ; Verizon at See Verizon at ( the service addresses contained in Verizon s customer database do not contain the 9-digit zip code information that corresponds to the end-user termination locations of wired broadband connections, and Verizon has no business purpose for that data ; AT&T at 18, n TWC at 3-4; see, also, e.g., AT&T at 18, n.50; NTCA at 6; CU at USTA at 13. See also, e.g., CBT at 4 ( CBT does not believe that the additional 4 digits are well suited to provide more localized information on broadband availability; Verizon at 15-13

16 Whereas 5-digit zip codes typically represent a specific geographic area, and thus data grouped by 5-digit zip codes could generally provide information regarding the areas of the country where broadband has been deployed and adopted, many 9-digit zip codes are point codes associated with individual customers (e.g., universities or large businesses, individual floors of an apartment building or even individual P.O. Boxes within a building. 37 Because of these idiosyncrasies, subscriber counts by 9-digit zip codes would often provide misleading information regarding the level of broadband deployment within particular geographic areas. 38 The comments also confirm that the Commission should continue to rely on subscriber data as a proxy for availability, and that the Commission should not require reporting of the number of homes passed. [M]any factors influence whether broadband service actually is available for a particular home such as the distance between a home and a provider s central office and the condition of the system plant, and consequently, broadband providers would have to collect this information for every home in order to accurately determine the number of 16 ( The Commission should not require wireline or fixed wireless broadband providers to report customer counts or any other data broken out by 9-digit zip codes because the financial and operational burdens would be large and the benefits insignificant ; Sprint/Nextel, at 9, n.8 ( Sprint Nextel does not support the provision of data based on 9-digit zip codes. It is likely that more time and effort would be spent sorting and aggregating these data than on examining the root causes where supply or demand for broadband services may be lacking. 37 See, e.g., NTCA at 4-5 (discussing the history of 9-digit zip codes. 38 A few commenters alternatively suggest that the Commission should require reporting of information by Census Block Tract (CBT or Census Block Group (CBG. As the California PUC explains (at 7-8, new legislation in California requires all broadband providers that also provide video services to submit information by CBT or CBG. Broadband providers, however, generally do not maintain information that identifies the CBT or CBG associated with each customer. As a result, such reporting, requires substantial effort to translate existing customer data into CBT or CBG formats. Indeed, it has taken AT&T a substantial amount of time and effort to create such information for just the areas in California where AT&T provides broadband services. 14

17 homes where service is available. 39 Collecting this information on a house-by-house basis would be expensive and difficult at best. 40 On balance, the burdens of a new homes passed reporting requirement clearly would outweigh any potential benefits. Moreover, homes passed could never be a technology neutral approach it is a meaningless metric, for example, for mobile broadband wireless services, which are designed to provide service anywhere in a particular area, not just within homes. 41 Finally, two commenters suggest that the Commission should try to replicate, on a nationwide basis, private-public broadband initiatives, such as Connect Kentucky. 42 As multiple other commenters demonstrate, the Commission should reject that approach. 43 The success of such initiatives is the product of unique localized public-private partnerships that do not lend themselves to centralized replication by a federal government agency. 44 For example, ConnectKentucky is able to work together with local communities to develop comprehensive technology growth plans and with broadband providers to develop commercially viable strategies for deploying service to underserved areas. ConnectKentucky s information-gathering activities are individually tailored to meet these goals efficiently, based upon localized conditions and the reporting parameters that best meet the technologies and information systems of each individual participant, including not just the facilities-based carriers that file Form Verizon at Id. at See, e.g., Sprint/Nextel at 10 ( Since wireless carriers do not have lines connecting their users to the internet, the number of homes passed... is not a calculation that wireless carriers can make ; Verizon at 20 ( In the case of wireless providers, the information is irrelevant because it conveys nothing about where service is actually available and used by subscribers. 42 See NYDPS at 2; CBT at TWC at 7-9; Verizon at 4-6; and AT&T at TWC at 7-9; Verizon at 4-6; and AT&T at

18 reports, but citizens, government agencies, cell tower and building owners and myriad other stakeholders. This decentralized approach allows far more flexibility than one-size-fits-all national broadband deployment reporting requirements imposed only upon facilities-based carriers. III. THE COMMISSION S CURRENT REPORTING REQUIREMENTS COLLECT SUFFICIENT INFORMATION ON THE AVAILABILITY AND ADOPTION OF WIRELESS MOBILE BROADBAND SERVICES. The Commission should retain the wireless broadband reporting requirements that are currently in place, which require providers to report the zip codes in which wireless broadband service is advertised and available and the number of wireless subscribers in those zip codes that have a broadband-enabled handset. As AT&T demonstrated, and as no commenter has refuted, the suggestion that reporting on this basis overstates the availability of broadband service is simply wrong: every AT&T wireless customer with a 3G-enabled handset automatically has access to AT&T s broadband services on at least a per-usage basis. See AT&T at 20. And, as CTIA notes (at 9, [t]he ability [of consumers] to take their mobile Internet access on shorter terms or on a metered use basis allows consumers the freedom to determine the best values for the broadband dollar, and a policy of omitting these consumers... would not accurately capture the number of wireless broadband users. 45 No party has offered any compelling reason to change this approach CTIA at 9-10 ( Some of these users may be attracted to the convenience and features supported by usage-based and/or pre-paid service offerings, but their usage may be as intense or as important as consumers who have subscribed to monthly plans. Even casual users derive a benefit from mobile wireless broadband Internet access and therefore should be given equal reporting status to other subscriber categories.. 46 WCA suggests that the Commission could require providers to report their service areas by 9- digit zip codes instead of five-digit zip codes, but that proposal should be rejected for the reasons explained in the previous section. CTIA (at 15 and Verizon (at suggest abandoning the zip code and billing address approach in favor of digital coverage maps, but the existing system 16

19 Accordingly, there is no sound basis for the various proposals to require providers to report more granularly which customers have which types of service plans or the specific types of broadband services customers may use. As WCA emphasizes (at 5, the Commission should... avoid the trap of basing its wireless broadband reporting structure on current [CMRS] offerings. While some customers choose to subscribe to monthly or longer term plans that provide access to a wireless provider s broadband capabilities, many customers prefer to purchase such capabilities on a per-usage basis but all of these customers indisputably have wireless broadband capabilities available to them for purposes of the Commission s reporting requirements. Similarly, the Commission should not require providers to break out and identify which customers download specific services at broadband speeds even though they do not subscribe to a monthly broadband plan. As Sprint/Nextel explains, it would be virtually impossible... to identify subscribers who did not subscribe to monthly broadband plans but who occasionally download entertainment features, use applications, or visit websites. 47 The Commission does not require wireline broadband providers to report how their customers use their broadband services, and there is no reason to require wireless providers to report such information either. 48 is substantially accurate and permits comparisons (since other providers also report by zip code, and as CTIA explains (at 15, the FCC (and everyone else already has access to these coverage maps on the providers websites. See also Neb. Rural Ind. Cos. at 4 (billing address approach correct because facilitates universal service determinations. 47 Sprint/Nextel at 3; id. (any such regulation would require providers to devote countless hours of dedicated resources to examine the details of each and every subscriber invoice to determine whether [customers] accessed the Internet. 48 CTIA at 9 ( [a]ttempts to fit wireless broadband subscribers into discrete categories would overlook[] the benefits of month-to-month and metered Internet use plans ; Verizon at 11 ( the Commission should not require that providers separately break out those subscribers that utilize wireless broadband on a less than month-to-month basis 17

20 For many of the same reasons, no useful purpose would be served by requiring providers to report which customers have full Internet browsing capabilities and which have only mobile Internet capabilities. There is no difference between full and mobile browsing capabilities that would be significant enough to justify an entirely new reporting requirement: [a]lthough the user experience may vary, the user still is able to access and effectively maneuver through the Internet at broadband speeds in either browser. 49 Indeed, the distinction between full and mobile is far from obvious; as CTIA points out, some people use their handsets that have mobile browsing capabilities as a modem for their laptop, where they can achieve full browsing. 50 As technology advances, other providers may offer a single service that offers both kinds of browsing or even more specialized browsing. 51 But whether full or mobile, all of these customers are obtaining access to the Internet, and there is no marketbased or other reason to distinguish between these customers or implicitly to treat one as inferior to the other. Once again, the only relevant inquiry is whether the customer has the ability to obtain the desired content delivered at broadband speed: [s]imply because the form factor is smaller, does not necessarily mean that the content is any less rich Verizon at 12; see also CTIA at 10 ( [o]ften times, what is seen and read on a wireless screen is no different than what would be read on a desktop or laptop. 50 CTIA at WCA at 5 ( WCA s constituents generally are developing new networks that offer wireless broadband as the primary service, not as an add-on, and will do so in ways that are not comparable to current offerings, including the possibility of offering service in a manner that would permit multiple devices to be connected under a single subscription, some of which might offer full Internet browsing and/or mobile web browsing, but others may be so specialized that they offer no web browsing. 52 CTIA at 10. See also WCA at 6 ( the agency ultimately will leave these providers no choice but to develop customized reporting tools at great expense, even though the information is irrelevant to the core issue of where broadband service is available and deployed to customers. AT&T supported in its opening comments the Commission proposal to modify the Form 477 instructions to identify as residential customers all subscriptions not billed to a government or 18

21 IV. ALL INTERCONNECTED VOIP PROVIDERS SHOULD REPORT SUBSCRIBER COUNTS. With a single exception, the commenters support requiring all interconnected VoIP providers to report how many retail customers they have and what percentage are residential and business. 53 As AT&T explained, interconnected VoIP services now comprise a very significant and growing portion of all local telephone services, and it is thus long past time to begin collecting subscriber information on these services. 54 Only Verizon opposes this new reporting requirement. Its argument is essentially that Form 477 is the wrong form for such data i.e., it argues that the purpose of Form 477 is determine the scope of the availability of broadband access services, but that interconnected VoIP is a broadband application. Verizon at 26. That objection is largely a makeweight; as the Commission notes, some LECs already report interconnected VoIP subscribers on Form 477 (Notice 22, and the Commission has a substantial interest relating not only to broadband corporate customer (or any other account with a tax identification number. AT&T initially had suggested that it could identify as residential customers those individuals associated with a business or government account who received their bill at a home or other address different from the corporate or business sponsor. AT&T wishes to clarify its position on this provision. AT&T supports counting as residential customers those customers who are associated with a business account, but who are, by contract, individually responsible for payment to AT&T for those services, rather than using the billing address to identify additional residential customers. AT&T proposes to continue to count as business customers those customers who are associated with business or government accounts and where the business not the individual is contractually responsible for payment for the mobile broadband services. AT&T wishes to make clear, however, that it does not provide residential service or classes of service limited to households or other physical locations. Any person with a 3G-enabled handset can use AT&T s wireless broadband service at home, at the office or at any other location where 3G service is available. Moreover, individuals can purchase wireless laptop connect service typically marketed to businesses, and business customers can purchase/download entertainment/ringtone content typically marketed to individual consumers. 53 See, e.g., NCTA at 15 ( the proposed collection requirements for VoIP providers are comparable to the reporting requirements imposed on local exchange carriers, and [c]onsequently, NCTA supports these requirements ; Illinois at 8-9; NYDPS at See AT&T at

22 deployment but also to local competition and universal service in tracking the growth of interconnected VoIP providers. 55 The comments confirm, however, that the Commission should not require interconnected VoIP providers to report whether that service is provided in conjunction with a broadband facility owned by that provider (or an affiliate of that provider. Vonage is the only commenter to support this proposal, but its argument is nonsensical: it claims that when the data are in, Vonage expects the data to reveal the extent to which independent VoIP providers rely on stand-alone DSL and cable broadband service to compete effectively. 56 But the Commission has not even proposed to require interconnected VoIP providers to report whether their service is provided in conjunction with a stand-alone broadband service (e.g., naked DSL. More fundamentally, however, Vonage makes no attempt to refute AT&T s showing that, for nomadic providers like AT&T, there is no practical means of tracking when the VoIP service is used with an affiliated broadband service (and certainly not whether such a service is standalone or not. Outside of some cable company non-nomadic VoIP services offered today, the concept of use with an affiliated broadband provider is meaningless and such reporting would inevitably be arbitrary and misleading. V. THE COMMISSION SHOULD RELY ON MARKET PRICING TRENDS, NOT PRICING DATA SUBMITTED BY INDIVIDUAL BROADBAND PROVIDERS. Finally, many commenters concur with AT&T that the Commission should not impose new reporting requirements to collect information on retail pricing of broadband services. As AT&T explained, for regulatory purposes the Commission need only continue to monitor macro 55 Verizon also argues (at that such reporting would not correspond to where the interconnected VoIP service is actually used, but it does not explain why the Commission s established billing address approach to wireless services, which exhibit the same nomadic characteristics, would not work equally well here. 56 Vonage at 5. 20

23 pricing trends in the broadband marketplace, which have consistently displayed rapidly declining prices even as broadband speeds have been increasing. 57 However, any attempt by the Commission to require detailed reporting of retail pricing would be burdensome and counterproductive, for several reasons. As multiple commenters emphasize, the market already provides consumers with all of the information they need to compare prices and services; reported prices would provide no useful additional information about availability or deployment. 58 Indeed, Commission pricing reports would be singularly unhelpful, because broadband pricing plans are constantly changing, and thus any Commission reports would always be substantially out of date. 59 Broadband pricing for any individual customer also often turns on a host of customer-specific variables, including speeds, promotional rates, bundling discounts, and other service characteristics, and therefore it would be virtually impossible and often misleading to attempt to correct for these variables and construct apples-to-apples pricing comparisons for reporting purposes. 60 As a number of commenters note, if the Commission wants to examine pricing information, it can and should use the substantial third-party analysis of broadband pricing that is available, rather than 57 See AT&T at (citing Fourth 706 Report, GN Docket No , FCC 04-20, at 13 (rel. Sep. 9, 2004 and GAO Report at 5, among other sources; see also Verizon at NCTA at 8 ( As Timothy Muris, former Chairman of the Federal Trade Commission stated: Most consumers are able to evaluate the broad array of competitive offering and assess the attributes of the different technologies, and noting that many third party analysts also provide consumers with a wealth of information; Embarq at 10; WCA at 8-9 ( price information is not a reliable indicator of availability; [f]or example, a wireless broadband provider might launch a service with a lower price than an incumbent cable or DSL provider, but might not enjoy the same market coverage as the incumbent until its network is fully built out over a period of years. 59 Verizon at 23; TWC at 9; NCTA at 9; Sprint/Nextel at Verizon at 25-26; TWC at 9; NCTA at 8; Sprint/Nextel at 10; WCA at

24 trying to force a one-size-fits-all reporting requirement of the widely disparate and constantly changing broadband offerings that are available in today s dynamic marketplace. 61 Although several parties ask the Commission to require submission of pricing information, these commenters offer nothing but conclusory statements in support. 62 Indeed, a number of these commenters implicitly recognize that simply reporting prices would not be meaningful because of the wide disparities in the features and characteristics of different broadband services, and thus they propose requiring providers to convert their actual prices into a variety of alternative formulations for reporting purposes, such as price per Mbps. 63 The Commission should reject these proposals. Such price conversions would not only be burdensome to produce, but the results would be meaningless and misleading data that would have no corollary in the real world and that would thus be useless for any regulatory purpose. A price per Mbps report, for example, would not account for non-speed-related features, such as free or discounted broadband modems, service reliability, the number of accounts or online storage capacity included with the broadband service, proprietary content available to the subscriber and myriad other factors that contribute to the overall value of a broadband service. The mere fact that one service may have a higher price per Mbps, therefore, may reflect only that the service includes additional valuable products and services that the lower price per Mbps services do not include. Thus, as with pricing in general, a price per Mbps would provide the Commission with little, if any, additional useful information. 61 See Verizon at APT at 8; CWA at 9; Illinois at 9-10; N.J. Rate Counsel at 5; Rep. Tom Sloan at 5; NATOA at CWA at 9 ( price per bit at the most granular level ; CU at (price per Mbps; Illinois at 11 (prices for each 9-digit zip code; Rep. Tom Sloan at 5 (price per bit speed; NATOA at 11 ( price per bit. 22