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April 29, 2002, 9:00 AM ET, Alert No. 420.
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FCC Commissioner Copps Addresses Regulation of Communications
4/26. Federal Communications Commission (FCC) Commissioner Michael Copps gave a speech [PDF] to the U.S. Conference of Catholic Bishops in Dallas, Texas. He addressed universal service subsidies, the FCC's public interest standard, media consolidation, regulation of broadcast speech, and other issues.
Copps stated that "Communications technologies can enlighten minds, convey powerful ideas, educate, enable, and lay a solid foundation for economic growth and human development. Or, they can twist minds, dumb down the exchange of ideas, coarsen the national dialogue and unbalance both economic and human development. The decisions we will make in the next years immediately before us will have much to do with which path is taken."
He praised Instructional Television Fixed Service (ITFS), and the FCC's e-rate program.
Broadband Internet Access as Universal Service. Copps also addressed other FCC run universal service subsidies. He said that "Each and every citizen of this great country should have access to the marvels of communications." He characterized this as "a civil right". He said that "Today, that means broadband".
Public Interest Standard. Copps also defended the public interest standard. "Not only do I find the concept attractive personally, but Congress made it the foundation of our communications statutes. In fact, the term ``public interest创 appears 112 times in the Telecommunications Act". He did not, however, offer an explanation of its meaning.
Media Consolidation. Copps also discussed media consolidation at length. He said that "We have experienced a great wave of mergers and acquisitions over the past half dozen years. Many formerly independent broadcast stations are now parts of huge ownership groups comprising hundreds of outlets. This consolidation has no doubt created efficiencies ... But this consolidation also presents us with serious questions of public policy."
He continued that "our people have always harbored a deep suspicion of excessive industrial consolidation, and they have always wanted sentinels at the gate to guard against it. Each proposed industry combination needs to be looked at on its merits -- some are good, some are not -- but the public interest test must be rigorously applied to every one of them. This is exactly what I have attempted to do in my first year at the Commission."
He concluded that "One of our most important jobs at the FCC must be the preservation of a bustling marketplace of ideas, a diversity in sources of content in each community, and a multiplicity of voices to stir discussion and debate throughout the land. This is what nurtures our democracy."
Regulation of Speech. Copps also stated that media have a "responsibility to act in the public interest".
"Broadcast and cable programming, in addition to being entertaining, should enhance our democratic discourse and educate our children", said Copps. "It is incumbent upon us at the FCC ... to ensure that that the bottom line does not displace the public interest as broadcasters' driving force."
"It is up to us at the FCC to make sure that there continue to be outlets for independent programming. We need to ensure that local broadcast stations continue to carry programming that serves the needs of the local community, covering local public affairs and serving the needs of all aspects of the community. In order to ensure that local communities are adequately served, there must be diverse sources of programming in each community -- not just a variety of programming formats but true diversity, providing a variety of voices and viewpoints."
Program Related Entities? Commissioner Copps also discussed the obligations of "program related entities". He said that "Right now broadcasters' only affirmative programming obligations are to serve their communities and to provide some programming that serves the educational needs of children. They need to do more. So do other program related entities. In the area of Public Service Announcements, cable programmers, local cable system operators and satellite providers -- not subject to the same public interest obligations as broadcasters -- nonetheless have obligations to be good corporate citizens. These programming providers, like broadcasters, have the ability to deliver targeted messages to specific audiences, and thereby to serve the public."
Copps also addressed efforts to regulate indecency.
FTC Commissioners Comment on Hollings' Online Privacy Bill
4/26. All five Commissioners of the Federal Trade Commission (FTC) wrote letters to Sen. John McCain (R-AZ) in response to his request to them for comments on S 2201, the Online Personal Privacy Act (OPPA), a bill to regulate the information collection and dissemination practices of web site operators and ISPs. Three Commissioners offered criticism of online privacy legislation. Two supported legislation.
Sen. McCain is the ranking Republican on the Senate Commerce Committee. Sen. Ernest Hollings (D-SC) is the sponsor of S 2201 and the Chairman of the Committee.
FTC Chairman Timothy Muris wrote in his letter that he has five concerns about the bill. First, he wrote that as attempts to implement the financial privacy provisions of the Gramm Leach Bliley bill have demonstrated, "Drafting workable legislative and regulatory standards is extraordinarily difficult." Second, "Whatever the potential of the Internet, most observers recognize that information collection today is also widespread offline. Legislation subjecting one set of competitors to different rules, simply based on the medium used to collect the information, appears discriminatory." Third, "We have insufficient information about costs and benefits." Fourth, "the online industry is continuing to evolve rapidly." He cited recent progress in privacy related practices identified in a report [PDF] prepared for the Progress and Freedom Foundation titled "Privacy Online: A Report on the Information Practices and Policies of Commercial Web Sites". And fifth, Muris wrote that "there is a great deal the FTC and others can do under existing laws to protect consumer privacy".
Commissioner Orson Swindle wrote in his letter that "there has been no market failure that would justify the passage of legislation regulating privacy practices concerning most types of information. Even if such a market failure exists, I am not persuaded that the benefits of such legislation, including the proposed Online Personal Privacy Act, exceed its costs." He added that "the best means of protecting consumer privacy without unduly burdening the New Economy is through a combination of industry self regulation and aggressive enforcement of existing laws that are relevant to privacy by the FTC and other appropriate regulatory agencies."
Commission Thomas Leary wrote in his letter that "I do not believe it is my place to advise Congress on the bottom line issue of whether it is or is not a good idea to legislate on privacy issues." Nevertheless, he went on to criticize the bill at length.
In contrast, Commissioner Mozell Thompson wrote in his letter that "Online privacy legislation is needed". He wrote that S 2201 "addresses many of the most delicate problems associated with a legislative privacy framework. First, it contains the fair information principles and allows for flexibility and change. The OPPA avoids a "one size fits all" approach to the notice requirements and provides a reasonableness test for access. The OPPA is also more reflective of a "real world" consumer environment because it employs a sliding scale that affords more protection to more sensitive information."
"Second, by preempting state law, the OPPA will prevent the possibility of multiple standards that could "Balkanize" e-commerce and prove overly burdensome to business and too confusing for consumers. Finally, in granting the FTC rulemaking authority, the OPPA will permit strong enforcement, with special sensitivity to industry and consumer needs, while also providing a means for state participation."
Commissioner Sheila Anthony wrote in her letter that the Hollings bill "provides long awaited, strong protection measures for consumers in the online world. My only concern with this proposed legislation is its limited reach. In my view, federal legislation is necessary to protect the privacy of personally identifiable consumer information in the offline as well as online commercial realms."
PFF Report Condemns Government Online Tax Preparation Services
4/25. The Progress and Freedom Foundation (PFF) released a report [PDF] titled "Online Tax Preparation: Beyond the Bounds of E-Government". It states that "While the application of new technologies to the provision of government services is clearly a good thing, it should not be a mechanism for expanding the role of government into new areas better left to the private sector. One area where governments may well be moving beyond their proper role is the provision of online tax preparation services for their residents."
The report, which was written by Thomas Lenard and James Harper, argues that "The entry of government into the online tax preparation business raises significant privacy, security, and conflict of interest issues. The privacy and security of taxpayers' deliberations about tax filing are likely to be eroded by online government tax preparation programs. And, there is an inherent conflict of interest between government in its roles as both a ``preparer创 of tax returns and an ``enforcer创 of the tax laws. It is inappropriate for the government, which is the enforcer, to be looking over the shoulders of taxpayers as they prepare their tax returns."
The report elaborates that while governments collect much information in tax filings, "tax preparation information is an additional set of information beyond the information filed with a completed tax return. Tax preparation information concerns citizens' deliberations about what will be included on forms, how expenses will be characterized, what individuals and entities will report what information, and so on."
It states that tax preparation information "will become more and more attractive information for auditors and other government investigators" and "the existence of a growing network of government databases creates an unseemly set of incentives for criminal investigators."
Bush Asks Senate to Pass TPA Bill
4/27. President Bush gave a radio address in which he advocated passage of trade promotion authority (TPA) legislation. He stated that "The Senate should pass the pending trade legislation without delay. Trade promotion authority would give me the flexibility to negotiate with other countries to open their markets and get the best deals for American producers and workers. Congress would still have the final up or down vote on any trade agreement."
Bush also stated that "I recognize that some American workers may face adjustment challenges as a result of trade. I support helping these workers by reauthorizing and improving trade adjustment assistance programs that will give workers impacted by trade new skills, help them find new jobs quickly, and provide them with financial assistance."
The House passed its TPA bill, HR 3005, on December 6. The Senate Finance Committee approved its version of the bill later in December. Sen. Tom Daschle (D-SD), the Senate Majority Leader, has yet to schedule the bill for consideration by the full Senate.
GAO Reports on DTV Deadline
4/26. The General Accounting Office (GAO) released a report [PDF] titled "Telecommunications: Many Broadcasters Will Not Meet May 2002 Digital Television Deadline".
The report concluded that "at least 24 percent of all commercial television stations are broadcasting a digital signal. At least 113 of the 119 broadcast stations that were mandated to be broadcasting a digital signal by 1999 are doing so. In addition, at least 185 of the remaining 1,121 commercial television stations that are to be broadcasting in digital by May 1, 2002, are on the air with a digital signal."
The report also found that "Once on the air, 74 percent of current DTV stations reported providing some amount of high definition content -- an average of 23 hours per week for those stations showing some high definition content. However, current DTV stations reported that they perceive little interest in DTV among consumers in their viewing areas at the present time."
The report also referenced DTV and the Internet. It stated that "Another advantage of digital television is that ``digital compression创 technologies allow for more efficient use of the radiofrequency spectrum than analog technologies. Using digital compression, broadcasters will have the opportunity to use the 6 megahertz of spectrum required to broadcast one analog television show to transmit four or five different digital ``standard definition创 television shows simultaneously." The reported noted that "The idea of broadcasters as ``multichannel创 operators could make broadcast television more competitive with cable and satellite television providers. A transition to digital technology also opens doors to future links between television sets and computers and the Internet, possibly making television viewing more of an interactive experience."
The report was prepared at the request of Rep. Ed Markey (D-MA), the ranking Democrat on the House Commerce Committee's Subcommittee on Telecommunications and the Internet.
7th Circuit Affirms Convictions of ELF Antenna Saboteurs
4/26. The U.S. Court of Appeals (7thCir) issued its opinion in USA v. Urfer, affirming the convictions of two people who sawed down poles that support an antenna for the U.S. Navy's Extremely Low Frequency (ELF) system for transmitting signals to its submerged ballistic missile submarines.
ELF. The U.S. Navy's ELF Communication System enables communications with submerged submarines. Radio signals attenuate rapidly when they pass through water. Submarines on patrol tend to be deep under the water, because traveling at or near the surface are more likely to be located by hostile parties. However, the rate of attenuation varies with radio frequency, with low frequency signals attenuating more slowly. The U.S. Navy sends messages to submerged submarines around the world using the frequency of 76 Hz. Generating a radio signal requires an antenna, the necessary length of which is inversely proportional to its frequency. Extremely low frequency transmissions require extremely long antennas. The U.S. Navy has strung several of these transmitting antennas to wooden poles located on federal land in the states of Wisconsin and Michigan. The antenna at issue in this case is 28 miles long and resembles a power line.
The defendants in this case, seeking to disable the U.S. Navy's nuclear missile submarine capability, sawed down a series of poles supporting an ELF antenna.
District Court. Defendants were prosecuted in U.S. District Court (EDWisc) for willfully injuring federal property in violation of 18 U.S.C. 1361 and 1362. They asserted in defense, among other things, that they had been advised by an attorney -- one Anabel Dwyer -- that sawing down these antenna poles would be legal. The District Court allowed this attorney to testify. It also instructed the jury on a "defense of counsel" defense; it instructed the jury that it could not convict the defendants if they "honestly believed their attorney's advice and acted in honest ignorance of their legal duties". The jury nevertheless returned verdicts of guilty. Defendants appealed on the grounds that they were not permitted to present evidence on "dangers to world peace".
Court of Appeals. The Court of Appeals held that "The only error committed at trial was in the defendants' favor. No advice of counsel instruction should have been given. There is no such thing as an ``advice of counsel创 defense."
Judge Richard Posner, who wrote the opinion of the Court, noted that "There are almost a million lawyers in the United States. Not all of them are competent; not all are honest." He added that "the lawyer's advice to these defendants was indeed unreasonable".
Posner also concluded that "It would be especially bizarre to suppose that antiwar activists have a right to disable the United States from using nuclear weapons when many other nations, not plagued by such activists, possess these weapons."
AT&T Fined for Antenna Violations
4/25. The Federal Communications Commission (FCC) released two Notices of Apparent Liability (NAL), finding AT&T and SpectraSite Communications liable for forfeitures in the amounts of $153,000 and $111,000, respectively, for violation of 47 U.S.C. 303(q), and FCCs rules, relating to antenna structure construction, marking, and lighting.
Section 303(q) provides that the FCC shall "Have authority to require the painting and/or illumination of radio towers if and when in its judgment such towers constitute, or there is a reasonable possibility that they may constitute, a menace to air navigation." The NALs were adopted by the FCC on April 18, and released on April 25. See, AT&T NAL, SpectraSite NAL, and FCC release.
Urfer and Sprong (see preceding story) sawed down poles supporting ELF antennas, in an attempt to shut down the U.S. Navy's ability to send messages to its submerged submarines, and compromise national security. They received light sentences and were ordered to "pay restitution of several thousand dollars". In contrast, AT&T and SpectraSite were fined $264,000 for failure to "paint antenna structures, and failure to replace lights" on antennas.
People and Appointments
4/25. The Senate confirmed several judicial nominees: Percy Anderson and John Walter to be Judges of the U.S. District Court (CDCal), Joan Lancaster to be a Judge of the U.S. District Court (DMinn), and William Griesbach to be a Judge of the U.S. District Court (EDWisc). See, Cong. Rec., April 25, 2002, at S3457.
4/24. Robert Gebhard joined the Palo Alto office of the law firm of Gray Cary Ware & Freidenrich as of counsel to the firm's bankruptcy and insolvency practice. Gebhard was previously the Assistant U.S. Trustee in San Jose, California. See, GCWF release.
4/19. Frederick Graefe joined the Washington DC office of the law firm of Hunton & Williams' as a senior member of its Government Relations Team. He was formerly a partner in the Washington DC office of the law firm of Baker & Hostetler. His practice focuses on several legislative and regulatory issues, including telecommunications and tax. See, H&W release.
4/22. Marc Brown, Mark Wine, Charles Rosenberg and Cynthia Lock joined the Los Angeles office of the law firm of McDermott Will & Emery as partners in the intellectual property practice. Brown was previously a partner in the Los Angeles office of the law firm of Oppenheimer Wolff & Donnelly. He counsels and represents clients in the procurement, evaluation and enforcement of high tech patents, software copyrights, software development and internet agreements, and trade secret disputes. Wine focuses on patent litigation and matters involving trademarks, trade dress, proprietary rights and trade secrets. Lock focuses on patent, trademark, trade dress and copyright infringement, right of publicity, false advertising, dilution, antitrust and unfair competition. Rosenberg litigates complex commercial and intellectual property cases, especially high tech patent cases. See, release.
4/23. John Creighton joined the Seattle office of the law firm of Preston Gates & Ellis as of counsel in the firm's Emerging Business Practice Group. He previously worked for the law firm of White & Case. He focuses on representing public and private companies in capital markets transactions, private placements, mergers and acquisitions, venture capital financings, loan transactions, corporate formation, reporting and disclosure, and general corporate matters. See, PGE release.
4/24. McLeod USA announced a new management team. Chris Davis is the new Chairman and CEO. Steve Gray continues as President. Ken Burckhardt is the new CFO. Clark McLeod will retire. See, McLeod release.
4/25. Sun Microsystems announced that CFO Michael Lehman "has decided to retire from full time duties" and that Steve McGowan will be the new CFO. See, Sun release.
More News
4/22. The International Intellectual Property Alliance (IIPA) announced that it has released a report titled "Copyright Industries in the U.S. Economy: The 2002 Report". The IIPA published a press release, but not the report, in the IIPA web site. The report was written by Stephen Siwek of Economists Incorporated.
4/22. The Securities and Exchange Commission (SEC) instituted and simultaneously settled an administrative proceeding against Teltran International Group, a company that provided Internet telephony, 1-900 services and traditional carrier services. See, SEC order.
Monday, April 29
The House will meet in pro forma session at 2:00 PM.
The Senate will meet at 1:00 PM and resume consideration of motion HR 3009, the Andean Trade Act.
The Supreme Court will go on recess until May 13.
9:30 AM. Phil Bond, Under Secretary of Commerce for Technology, and others, will hold a press briefing on Secretary of Commerce Donald Evans' trip to Asia on April 21-25; they will also address other Technology Administration (TA) activities. See, TA notice. Location: U.S. Department of Commerce, Room 4813, 1401 Constitution Avenue.
10:00 - 11:30 AM. The Federal Communications Commission's (FCC) Office of Engineering and Technology (OET) will hold a tutorial titled Security of Wireless Networks. David Wagner, Assistant Professor in the Computer Science Division at the University of California at Berkeley, will discuss security issues associated with 802.11 wireless networks. See, FCC release.
12:15 PM. The FCBA's Cable Practice Committee will host a luncheon. Rick Chessen, head of FCC's DTV Transition Task Force, will discuss Chairman Powell's proposal for accelerating the transition to digital television. The price to attend is $15. RSVP to wendy Location: Mintz Levin, 9th Floor, 701 Pennsylvania Avenue, NW.
2:00 PM. The House Ways and Means Committee's Subcommittee on Social Security will hold a field hearing titled "Protecting the Privacy of Social Security Numbers and Prevent Identity Theft". See, W&M release. Location: Lake Worth, Florida.
Tuesday, April 30
The House will meet at 12:30 PM for morning hour and 2:00 PM for legislative business. No votes are expected before 6:30 PM. The House will consider a number of bills under suspension of the rules.
The U.S. Chamber of Commerce will host an event titled Beyond Broadband: Policy and Business Strategies for Next Generation Applications and Services. FCC Chairman Michael Powell will give the keynote luncheon address at about 1:00 PM. The price to attend ranges from $275 to $500. For more information, contact Liza Ratana at 202 463-5500. Location: 1615 H Street NW.
12:30 - 2:00 PM. The Advisory Committee to the Congressional Internet Caucus will host panel discussion titled Digital Rights Management: Whose Rights are Being Managed? RSVP to Danielle Wiblemo at rsvp or 202 638-4370. Lunch will be served. Location: Cannon Caucus Room, Cannon Building.
Deadline to submit reply comments to the FCC in response to its notice of proposed rulemaking regarding its unbundling analysis under  251 of the Communications Act and the identification of specific unbundling requirements for incumbent local exchange carriers. This is CC Docket No. 01-338. See, notice in the Federal Register.
Deadline to submit requests to the USPTO's to speak at its May 16 public hearing on its proposed plan to eliminate the paper patent and trademark registration collections from its public search facilities, and to transition to electronic patent and trademark information collections. The USPTO is seeking public comment on issues related to this proposed plan. The USPTO is also seeking input on whether any governmental entity or non-profit organization is interested in acquiring the paper patent and trademark registration collections to be removed from the USPTO's public search facilities. See, notice in Federal Register.
Wednesday, May 1
The House will meet at 10:00 AM for legislative business.
9:30 AM - 4:00 PM. The Antitrust Division of the Department of Justice and the FTC will hold another in their series of hearings on antitrust and intellectual property. This event is titled "The Strategic Use of Licensing: Is There Cause for Concern about Unilateral Refusals to Deal?" The speakers will be Ashish Arora (Carnegie Mellon University), Jonathan Gleklen (Arnold & Porter), Paul Kirsch (Townsend Townsend & Crew), Benjamin Klein (UCLA), Jeff Mason (University of Michigan), Douglas Melamed (Wilmer Cutler & Pickering), Carl Shapiro (UC Berkeley), Christopher Sprigman (King & Spalding), Mark Whitener (General Electric), and John Wiley (UC Los Angeles). The DOJ requires that attendees provide their name and date of birth 24 hours in advance to Kathleen Leicht at kathleen.leicht or 202 514-7018. Location: Great Hall, Department of Justice, Main Building, 950 Pennsylvania Ave., NW.
10:00 AM. The House Commerce Committee's Subcommittee on Oversight and Investigations will hold a hearing on titled "Oversight and Management of the Government Purchase Card Program". Location: Room 2322, Rayburn Building.
10:00 AM. The House Financial Services Committee's Subcommittee on Capital Markets will hold a hearing titled "Corporate Accounting Practices: Is There a Credibility GAAP?" Location: Room 2128, Rayburn Building.
11:00 AM - 12:00 NOON. The USTrade Coalition will hold a press conference regarding trade promotion authority legislation. For more information, contact Kitty Brims at 202 637-3074 or ustrade Location: Room 215, Dirksen Building.
11:00 AM. The Cato Institute will host a panel discussion titled A Progress Report on the HDTV Transition. The scheduled speakers are Mark Cuban (HDNet), Thomas Hazlett (Manhattan Institute), Rick Chessen (FCC), David Donovan (Association for Maximum Service Television), Michael Calabrese (New America Foundation), and Richard Wiley (Wiley Rein and Fielding). See, agenda and online registration page. Location: 1000 Massachusetts Avenue, NW.
12:00 PM. The FCBA will host a luncheon. The speaker will be Charlie Ergen, Ch/CEO of Echostar. The price is $45 for FCBA members, $35 for government and student members, and $55 for non-members. There will be a reception at 12:00 NOON. The luncheon will begin at 12:30 PM. RSVP to Wendy Parish at wendy by Friday, April 26. Location: Capital Hilton, 16th & K Streets.
1:30 - 1:30 PM. The FCC's World Radiocommunication Conference 2003 (WRC-03) Advisory Committee, Informal Working Group 7 (Regulatory Issues and Future Agendas) will hold a meeting. Location: FCC, 445 12th Street, SW, Room 7-B516 (7th Floor South Conference Room).
Deadline to submit comments to the USTR regarding U.S. negotiating objectives and the work program launched at the Fourth Ministerial Conference of the WTO in November at Doha. See, USTR release and notice in the Federal Register.
Extended deadline for submitting comments to the Treasury Department regarding its study of information sharing practices among financial institutions and their affiliates. See, notice in Federal Register.
Thursday, May 2
The House will meet at 10:00 AM for legislative business.
8:30 - 10:00 AM. The American Enterprise Institute (AEI) will host a press breakfast titled "Telecommunications and Media Issues" with former FCC Commissioner Harold Furchtgott-Roth and other AEI scholars. RSVP to Veronique Rodman at telephone 202 862-4871 or vrodman Location: AEI, 1150 17th Street, NW, 11th Floor Conference Room.
9:00 AM - 12:00 NOON. The Antitrust Division of the Department of Justice and the FTC will hold another in their series of hearings on antitrust and intellectual property. This hearing is titled "Patent Settlements: Efficiencies and Competitive Concerns". The speakers will be George Cary (Cleary Gottlieb), Steven Stack (Dechert), Thomas Barnett (Covington & Burling), Joseph Brodley (Boston University School of Law), Robert Cook (Drinker Biddle & Reath), Richard Feinstein (Boies Schiller & Flexner), Phillip Proger (Jones Day), and Carl Shapiro (University of California at Berkeley). See, agenda. Location: Room 432, FTC, 600 Pennsylvania Ave., NW.
9:30 AM - 12:30 PM. The NIST will hold a proposers' conference for its Advanced Technology Program (ATP). See, notice in Federal Register. Location: Gaithersburg Hilton, 620 Perry Parkway, Gaithersburg, MD.
10:00 AM. The Senate Appropriations Committee will hold hearings on homeland security and the FY 2002 supplemental appropriations request. Attorney General John Ashcroft is scheduled to testify at 2:30 PM. Location: Room 192, Dirksen Building.
Friday, May 3
The House will not be in session.
9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Trans Union v. FTC, No. 01-5202. Judges Edwards, Henderson and Garland will preside. Location: 333 Constitution Ave., NW.
9:30 AM - 3:30 PM. The FCC will host a public forum and technology expo on Telecommunications Relay Service. Location: FCC, 445 12th Street, SW, Room TW-C305 (Commission Meeting Room).
10:00 AM - 3:00 PM. The FCC's Consumer and Governmental Affairs Bureau will host a public forum and technology expo on the Telecommunications Relay Service (TRS). Location: FCC, Commission Meeting Room (Room TW-C305), 445 12th St., SW.
Extended deadline to submit comments to the FCC in response to its Notice of Proposed Rulemaking titled "In the Matter of Appropriate Framework for Broadband Access to the Internet over Wireline Facilities". This is CC Docket No. 02-33. See, Order [PDF] extending deadline from April 15 to May 3. See also, original notice in Federal Register.
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