FCC Delays Proceeding on State Regulation of Airport WiFi Hotspots
August 24, 2005. The Federal Communications Commission (FCC) Office of Engineering and Technology (OET) released an order [2 pages in PDF] in its proceeding on the state of Massachusetts' attempt to regulate WiFi hotspots at the Boston Logan Airport. The order grants the state a one month delay.
This order extends the deadlines for submitting initial comments (from August 29 to September 28) and for submitting reply comments (from September 13 to October 13).
On July 8, 2005, Continental Airlines filed with the FCC a Petition for a Declaratory Ruling [16 pages in PDF] and supplement [PDF] regarding the Massachusetts Port Authority's (MPA or MassPort) attempt to regulate and extract revenues from airport WiFi hotspots.
The MPA asked for this extension of timeon the grounds that it is engaged in settlement negotiations with Continental. However, Continental promptly responded to the FCC that there have been no settlement negotiations. Moreover, the Airports Council International-North America (ACI-NA), which shares the MPA's interests, also asked for an extension, but acknowledged to the FCC that it has not communicated with Continental's counsel.
Thus, the parties have not indicated why the delay was actually sought. One possibility is that since a literal application of the Communications Act and the FCC's Over the Air Reception Devices (OTARD) rules would result in the FCC issuing a declaratory ruling in favor of Continental that would also serve as a precedent that would preclude all state and local government entities from making similar assertions, the state and local government entities now seek time to build political pressure on the FCC, especially in light of the fact that the Congress is currently on recess, and its members and staff widely dispersed.
The MPA stated to the FCC that it is "independent public authority" of the state of Massachusetts, created by an act of the legislature, to own and operate the Logan Airport and other facilities in the Boston area.
Continental installed a WiFi hotspot in its frequent flyer lounge at the Boston Logan International Airport. It provides WiFi access for free.
The MPA has demanded removal of Continental's antenna. The MPA asserted in a letter to Continental (which is attached to Continental's petition) that there is a "potential threat to public safety caused by Continental’s unauthorized and unlawful wireless communications". The MPA asserts that Continental's service creates an radio frequency interference problem.
However, the MPA's action appears to be a thinly disguised effort to regulate WiFi hotspots at airports for the purpose of indirectly collecting revenues from WiFi users. That is, it is an effort to impose a hidden tax on WiFi users. Airport WiFi users make a particularly attractive target for local tax collectors because most will not be residents of the locality, and the tax will be disguised as a fee charged by the airline.
The correspondence attached to Continental's petition reflects that the MPA does not object to WiFi operation at the airport. It provides WiFi service through a third party vendor. Rather, the MPA wants to compel Continental to use its third party vendor's facilities, and to pay its rates, and by implication, pass the costs on to its customers as a hidden tax.
The MPA also complained that some airport users have obtained free WiFi access by positioning themselves just outside of Continental's lounge, thereby decreasing use of the MPA licensed, and fee based, system.
The MPA wrote to Continental that it "may make fixed wireless services available in its Clubroom by making arrangements to route its wireless signals over the existing WiFi backbone which has been installed and is operated by AWG, a third party vendor." The MPA stated that Continental will be charged "for airline use based on the number of enplanements" or on the "hits".
The MPA asserts that it is motivated by public safety and interference concerns. However, its demand that Continental pay to provide WiFi service impeaches its own assertions. Moreover, neither the MPA, the ACI-NA, nor any other party has yet filed anything with the FCC in this proceeding regarding harmful interference that would rebut the argument that its assertions are meritless.
The MPA also asserts that as the owner of the airport, it can control use of WiFi antennas as owner of the property through leasing agreements.
Continental asserts that there is no interference issue, and that even if there were, the FCC has sole jurisdiction over the issue, and the MPA is precluded by the Communications Act and the OTARD rules from attempting to license or exclude WiFi antennas.
However, while the relevant provision of the Communications Act and the OTARD rules may appear to be clear, government entities that have advanced public safety arguments have been quite successful at the FCC recently. The FCC has granted relief sought by public safety entities, even where the statutory authority was unclear, or plainly contrary to the position sought by public safety entities. Two recent examples would be the FCC's August 5, 2005, CALEA order (the text of which has not been released), and the FCC's May 19, 2005, VOIP 911 order
See, story titled "FCC Amends CALEA Statute" in TLJ Daily E-Mail Alert No. 1,191, August 9, 2005; stories titled "FCC Adopts Order Expanding E911 Regulation to Include Some VOIP Service Providers", "Summary of the FCC's 911 VOIP Order", "Opponents of FCC 911 VOIP Order State that the FCC Exceeded Its Statutory Authority", and "More Reaction to the FCC's 911 VOIP Order" in TLJ Daily E-Mail Alert No. 1,139, May 20, 2005; and story titled "FCC Releases VOIP E911 Order" in TLJ Daily E-Mail Alert No. 1,148, June 6, 2005.
FCC's June 24, 2004 Public Notice. On June 24, 2004, the FCC's OET issued a Public Notice [MS Word]. This Public Notice is DA 04-1844. (The FCC's August 24, 2005 order incorrectly identifies this as DA 04-184.)
This Public Notice pertains to the use of unlicensed devices in multi-tenant environments (MTEs), by which the FCC also means hotels, conference and convention centers, and airports. This Public Notice particularly addresses assertions of radio frequency interference (RFI).
The Public Notice states that the "the FCC has exclusive authority to resolve matters involving radio frequency interference [RFI] when unlicensed devices are being used, regardless of venue." It adds that consumers have the right "under our rules to install and operate customer antennas one meter or less in size apply to the operation of unlicensed equipment, such as Wi-Fi access points -- just as they do to the use of equipment in connection with fixed wireless services licensed by the FCC." And, it states that the "FCC’s Over-the-Air Reception Devices (OTARD) rules apply to unlicensed devices".
In contrast, the MPA asserted (in correspondence attached to Continental's petition) that there is a RFI issue, and that the MPA "does not concede" that the FCC's OTARD rules are lawful.
MPA Motion for Extension of Time. The MPA filed a Motion for Extension of Time [4 pages in PDF] on August 16. It again asserted that its interests are "safety and security". It makes no mention of tax collection.
It also made a brief comparison between this proceeding and the history of commercial uses in the 800 MHz band.
The MPA's motion reveals that it has hired counsel with expertise and experience in federal communications law and administrative procedure. The motion was filed by Christine Gill and Keith McCrickard of the Washington DC office of the law firm of McDermott Will & Emory. Gill has worked on both the 800 MHz interference proceeding, and on MTE matters. Both are partners in firm's Telecommunications Practice Group.
ACI-NA Motion. The Airports Council International-North America (ACI-NA) also filed a Motion for Extension of Filing Deadlines [6 pages in PDF] on August 16. It states that it "represents local, regional and state governing bodies that own and operate the principal airports". It asserted that it needs more time to consult with its members.
The ACI-NA is represented in this proceeding by Matthew Ames of the Washington DC office of the law firm of Miller and Van Eaton.
Continental's Reply. Continental promptly filed a reply [4 pages in PDF] to the motions for delay. It stated that there is not an interference problem, and Continental has "rights under the OTARD rules to operate its own Wi-Fi system". It did not address the collection of revenues.
This comment rebuts the MPA's assertion that an extension is necessary because of settlement negotiations. It wrote that "it is not in discussions with Massport with a view towards settling any dispute it has with Massport on this matter".
Continental is represented by Henry Rivera and Edgar Class of the Washington DC office of the law firm of Vinson & Elkins. Rivera is a former Commissioner of the FCC. Class worked on the 800 MHz proceeding.
Continental wrote that "this matter raises significant public policy issues for the flying public and all airport tenants with regard to the Commission’s Over-the-Air Reception Devices (``OTARD´´) rules and its recently issued Policy Statement regarding preservation and promotion of the interconnected nature of public Internet.
Continental added that "Much more is at stake in this matter than the interpretation of restrictions in a lease agreement and it is strongly in the public interest that the Commission resolve the public policy issues presented and resolve them promptly. Massport believes airport tenants, including but not exclusively airlines, are required to use its Wi-Fi system notwithstanding the OTARD rules and are not allowed to operate their own systems. Massport has even questioned the legality of the OTARD rules. Continental believes it has the right to operate its own Wi-Fi system at Logan and seeks by its petition to the Commission to vindicate its rights under the OTARD rules. Clearly, the Commission will substantially benefit the public, not only Continental and Massport, by resolving the public policy issues presented and Massport’s interpretation of the OTARD rules."
Public Response. The FCC had received well over 2,000 comments as of August 24. Almost all of these are brief comments by individuals. And, the overwhelming majority are identical comments from Continental's customers. The form comment states as follows:
"I am a Continental Airlines frequent flyer and member of its Presidents Club. I support Continental's Petition to the FCC. I want Continental to be able to continue to provide its own wireless service to me and other members at Boston Logan and other airports, which is a free service. I rely on Continental's seamless service wherever I fly. Thank you for ensuring the right of the public to use the wireless service of its choice."
FCC staff sometimes denigrate form comments and commenters. However, Commissioners sometimes cite these as proof of widespread public concern, as for example, in the FCC's proceedings on media ownership rules.
See also, story titled "FCC Seeks Comments of Massachusetts Port Authority's Attempt to Regulate Airport WiFi Hotspots" in TLJ Daily E-Mail Alert No. 1,186, August 2, 2005.
The FCC's August 23, 2005, order extending comment deadlines is
DA 05-2335 in ET Docket No. 05-247.