FCC TO EXAMINE FRAMEWORK FOR IMPLEMENTING CALEA ON BROADBAND SERVICES

The FCC tentatively concluded Wed. that CALEA applies to facilities-based providers of “any type of broadband Internet access service -- including wireline, cable modem, wireless and powerline -- and to managed or mediated [VoIP] services.” This was the wording of a rulemaking launched to determine the appropriate legal and policy framework for implementing CALEA, particularly regarding broadband access and services. The agency said the tentative conclusions were based on its proposal that such services fall under CALEA as “a replacement for a substantial portion of the local telephone exchange service.” But FCC officials said CALEA wouldn’t apply to “non-managed” P2P VoIP services such as those provided by Pulver.com or Skype. FCC Comrs. Copps and Adelstein concurred.

“CALEA requirements can and should apply to VoIP and other IP-enabled service providers, even if these services are ‘information services’ for purposes of the Communications Act,” FCC Chmn. Powell said. But he said he wanted to “make clear that our tentative conclusion is expressly limited to the requirements of the CALEA statute and does not indicate a willingness on my part to regulate VoIP services as telecommunications services.” He said “nothing in this item prejudices the outcome” of the pending rulemaking on IP- enabled services and several petitions for declaratory ruling that address themselves to the classification of VoIP services. He said the Commission’s major goal in the proceeding was to “ensure that law enforcement agencies have all of the electronic surveillance capabilities that CALEA authorizes to combat crime and terrorism and support Homeland Security.” He said the agency would provide the necessary resources to “expeditiously and responsibly complete this task.”

The proceeding was initiated in response to a joint petition by the Justice Dept., FBI and Drug Enforcement Administration in March. The FCC denied the Law Enforcement’s request to pre-approve applications by VoIP providers bringing a sigh of relief to the VoIP industry. “Such a requirement could have spelled the death knell for the nascent industry without the resources to engage in such an unnecessary and time-consuming pre-approval process,” Pulver.com Gen. Counsel Jonathan Askin told us.

In the declaratory ruling also adopted Wed., the FCC granted in part a law enforcement request and clarified that commercial wireless push-to-talk services were subject to CALEA, regardless of the technologies Commercial Mobile Radio Service providers applied. An FCC official told reporters the declaratory ruling “focuses only on push-to-talk service,” and with regards to the other issues that were raised in the Law Enforcement petition, “we draw tentative conclusions but have not ruled and we invite comments on those issues.” CTIA Pres. Steve Largent said he expected the FCC would provide “a reasonable timeframe for push-to-talk services to become CALEA compliant.”

In the NPRM, the FCC tentatively concluded that it was “unnecessary to identify future services and entities subject to CALEA.” It said while it recognized law enforcement’s need for certainty on the applicability of CALEA to new services and technologies, it expected the final decision in the proceeding would provide “substantial clarity sufficient to resolve Law Enforcement’s and industry’s uncertainty about future compliance obligations.”

The FCC asked for comment on telecom carriers’ obligations under Sec. 103 of CALEA and compliance solutions as they relate to broadband Internet access and VoIP. Specifically, the Commission sought comment on: (1) “The feasibility of carriers relying on trusted 3rd party to manage their CALEA obligations.” (2) Whether “standards for packet-mode technologies are deficient and thus preclude carriers from relaying on them as safe harbors for complying with CALEA.” It also asked what would be “a reasonable amount of time” for entities that haven’t been subject to CALEA to comply with its requirements if the Commission decides they are.

To ensure CALEA compliance, the Commission proposed to restrict the availability of compliance extensions under CALEA Sec. 107(c) and clarified the role of CALEA Sec. 109, under which carriers may be reimbursed for their CALEA compliance costs. It proposed to give all carriers with pending petitions “a reasonable period of time” such as 90 days to comply with or seek relief from any determinations that it would adopt in the proceeding. The Commission also said it considered whether it could take separate enforcement action against non-compliant carriers, in addition to the enforcement remedies through the courts available to law enforcement. It tentatively found it had “general authority under the Communications Act to promulgate and enforce CALEA rules against carriers and non-common carriers.”

The FCC also tentatively concluded carriers were responsible for CALEA development and implementation costs for post-Jan. 1, 1995, equipment and facilities. It asked for comment on cost recovery issues for wireline, wireless and other carriers and referred to the Federal-State Separation Joint Board cost recovery issues for carriers subject to Title II of the Communications Act.

Copps criticized the item, saying while it asked “many of the right questions… too often it gets the reasoning wrong. It is flush with tentative conclusions that stretch the statutory fabric to the point of tear.” He expressed concern that “if these proposals become the rules and reasons we have to defend in court, we may find ourselves making a stand on very shaky ground. It would be a shame if our reliance on thin legal arguments results in the CALEA rules being thrown out.” Adelstein said rather than seeking comment on “the most stable footing for law enforcement’s request, the item seizes upon notable but thin distinctions between definitions in CALEA and the Communications Act.” He said the item also did “not acknowledge fully and seek comment on existing precedent that is in tension with the tentative conclusions here.”

Copps said “capturing VoIP under the rubric of substantial replacement, ignoring the 9th Circuit’s decision in Brand X, and trying to slice and dice managed and non- managed services is not the way to proceed here.” But Powell told reporters: “The thing about the Brand X decision is mistaken. The criticality of the CALEA item that was of greatest concern with the FBI is that the Brand X decision only goes to Internet service providers who have facilities- based offers. Thus if you are a cable company, you offer infrastructure. It said that a portion of that is telecom and a portion of that is an information service. But something like Vonage… has no such infrastructure whatsoever.” He said for telecom services or those that will be determined to be such by the Commission, “there is no issue whatsoever that CALEA applies… Nobody has any doubt that if something is a telecom service, it will be subject to CALEA. The concerning question is whether there will be services like information services or other that wouldn’t meet that portion of the statute, but would they otherwise be subject to CALEA and that’s what the substitutability argument in the CALEA order is about.”

NTIA Dir. Michael Gallagher commended the Commission for acting quickly on the law enforcement petition. “By issuing this notice, the Commission takes an important first step to ensure that law enforcement has access to the advanced tools needed to pursue those who would threaten us using advanced technologies.” An NCTA spokesman said the cable industry “strongly supports the application of CALEA requirements to VoIP services.”

VON Coalition said it wasn’t necessary to “expand CALEA to Internet communications beyond Congressional intent because that would inadvertently stifle innovation and delay consumer benefits without a commensurate increase in security.” Askin told us: “Importantly, the item does not propose to classify VoIP as a telecommunications service, and, therefore, should not take us down a slippery slope in which VoIP would be categorized as a telecom service and subject to the host of telecom regulations.”