All Form 477 Filers Have a Unique One-Time FCC Reporting Obligation

All companies that were required to file a Form 477 for 2013 must respond to the FCC’s one-time Special Access Data Collection.  The type of response required will depend on each company’s reporting category.  Responses for companies not falling into specially-designated categories are due December 15.  Other companies falling into these categories will be required to respond by January 29, 2015 or February 27, 2015, depending on their size.  This update provides additional information to help companies determine the type and timing of response required.

Overview of Filing Requirements

On September 15, 2014, the FCC issued an Order finalizing the details of its Special Access Data Collection, which will collect detailed information about the market for high-capacity dedicated telecommunications and broadband services, including information on pricing, services provided, locations served, and terms of service.   

            All companies that were required to file a Form 477 covering 2013 must respond to the data collection in some way.  Companies that fall into the specially-designated categories of “Providers,” “Purchasers,” and “Best Efforts Business Broadband Providers” categories must report detailed data, while companies that do not fall into one of those categories must file only a short form certifying that they do not fit those categories.

Because the short form certification is due on December 15, 2014, all entities that filed a Form 477 for 2013 must determine now whether they fall into one of the reporting categories.

            To determine which category a company falls into, it’s important to understand how the FCC defined the key term “special access.”

Special access defined.  Special access, or dedicated services, transport voice and data over a dedicated transmission line between two or more designated points at a rate of at least 1.5 Mbps with performance requirements that include bandwidth, latency, error-rate, or other quality-of-service guarantees. 

Special access services include both circuit-based dedicated services, such as a DS3 circuit, and packet-based dedicated services, such as Ethernet Private Lines.  Examples include:  

• Dedicated service to towers for backhaul of wireless traffic.
• A circuit connecting two cable headends.
• Dedicated connections for businesses, schools, libraries, healthcare facilities, ATMs and credit card readers, or government buildings.
• Dedicated services purchased to transport traffic – for example, a connection for transporting Internet traffic to and from points of connection to the Internet backbone.
• Dark fiber leases and IRUs.

Categories of companies that must respond.  All companies that were required to file a Form 477 covering 2013 must respond to the data collection in some way.  Companies that are “Providers” or “Purchasers” of special access services and “Best Efforts Business Broadband Providers” must report detailed data, while companies that do not fall into one of those categories must certify that they do not fit those categories.

Note:  Some of the categories focus on services provided or purchased in “price cap areas.”  Price cap areas are served by price cap carriers – large incumbent local exchange carriers such as AT&T, Verizon, CenturyLink, and others.  The FCC released a mapping tool to assist in identifying price cap areas. 

1. A “Provider” is any company that provided special access services in 2013 in price cap areas, or any company that had a connection capable of providing special access services in price cap areas in 2013.

Note:  A company is a Provider if it had a connection capable of providing special access services, even if no special access services were actually provided over that connection.  A “connection” is any wired line or wireless channel that provides a dedicated communication path between two points.  Dark fiber can be a “connection.”

1. A “Purchaser” is any company that purchased $5 million or more of special access services in price cap areas in 2013.

1. A “Best-Efforts Business Broadband Provider” is any company that (1) provided Internet access service with a minimum advertised speed of at least 1.5 Mbps (both upstream and downstream) in price cap areas; (2) marketed the service to business customers; and (3) served at least 15,000 residential customers or at least 1,500 business customers in 2013. 

1. All other broadband providers.  A company that was required to file Form 477 covering 2013 but does not meet any of the three categories above must certify to the FCC that it does not fall into any of the three data-reporting categories.  This includes entities that do not operate in price cap areas. 

Deadlines and Mechanics of Filing

Deadlines.  Companies not falling into one of the specified filing categories above must file the certification by December 15, 2014.  Companies falling into any of the other three specified categories must file by January 29, 2015 (for businesses with more than 1,500 employees, measured at the parent company level) or February 27, 2015 (for businesses with fewer than 1,500 employees). 

 Information collected and confidentiality.  Depending on which categories an entity fits into, filers may be required to report information on facilities, billing, revenues, prices, expenditures, service terms, locations, and business plans and operations including advertising and marketing plans.  The FCC adopted a protective order so that entities can submit information confidentially and protect their customers’ private information and their own proprietary business information.

The protective order did not directly address the Cable Act’s cable subscriber privacy provisions.  Last month, NCTA asked the FCC to issue an administrative subpoena so cable operators can participate in the data collection without violating the Cable Act’s privacy provisions. The FCC has not acted on that request.

For the certifications due on December 15, cable subscriber privacy is not implicated.  For submissions due in January and February, it is.  We’re monitoring the proceeding for further FCC guidance on how cable operators can comply with the data collection without violating the Cable Act’s privacy provisions.

Filing mechanics.  Filers must submit their responses to the FCC via an online filing system designed for the data collection.  Each section of the form will describe the mandatory types of data which respondents must submit, as well as optional data that the FCC requests. 

Failure to file.  To ensure that all providers respond, the FCC will cross-reference the list of companies that respond to the data collection with the list of providers that filed Form 477 covering 2013.  The FCC will investigate and can take enforcement action against any company that does not respond to the data collection.  Failure to respond can result in significant financial penalties up to $1,575,000.

Next steps.  Companies need to determine before December 15 which of the four categories above they fall into.  

Companies in the “all other broadband providers” category must file their certifications by December 15.

For companies in the Provider, Purchaser, or Best-Efforts Business Broadband Provider categories, the information collected will be extensive.  It would be prudent to appoint a team to begin collecting data in the very near future if you have not already done so.

Additional resources.  The FCC’s Special Access Data Collection website offers more resources, including a set of FAQs and detailed filing instructions.

If you have questions regarding the FCC’s Special Access Data Collection or need assistance in filing please contact Maayan Lattin at (202) 872-6881 or mlattin@cinnamonmueller.com, Noah Cherry at (202) 872-0234 or ncherry@cinnamonmueller.com, or Bruce Beard at (314) 394-1535 or bbeard@cinnamonmueller.com.