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Text Box: BY GREGORY E. KUNKLE LAW OFFICES OF THOMAS K CROWE One of the most newsworthy stories out of the FCC in recent weeks was the appointment of a new Chairman in former FCC Commissioner Kevin Martin. In another event deserving attention, the FCC recently began a rulemaking proceeding which will affect the way in which line-item charges are reflected on carrier invoices. Consultants should also closely monitor the recent wave of consolidation between major telecommunications carriers. Kevin Martin: New FCC Chairman On March 16, 2005, the White House announced that Kevin Martin would succeed Michael Powell as the Chairman of the Federal Communications Commission. Martin, a North Carolina native, first joined the FCC in 1997. After leaving the FCC in 1999 to spend time as an advisor to George W. Bush’s presidential campaign, Martin returned to the FCC in July 2001 when he was sworn in as Commissioner. He has served as one of the FCC’s Republican Commissioners since that time. However, on occasion Martin has broken with his party on telecommuni-cations issues. The most notable instance came in 2003 when Martin sided with the two Democratic Commissioners in opposing Powell’s proposal to scale-back local phone competition rules. Many may remember that, at the time, Martin’s stance caused observers to question Powell’s leadership. However, while Martin was a proponent of competition for local telecommunications services, Martin demonstrated a greater willing-ness to resist requiring broadband pro-viders to open their networks to com-petition. In Martin’s words, by pro- t

Text Box: tecting proprietary networks, such deregulation would serve to make it “easier for companies to invest in new equipment and deploy the high-speed services that consumers desire.” Such statements may indicate that Martin will adopt a similar deregula-tory approach when the FCC decides the issue of the proper level of oversight to exercise over IP-enabled services in the near future. Because Mr. Martin was already serving on the FCC, his appointment as chairman did not require a potentially time-consuming congressional confirmation process. However, his appointment as Chairman does leave an empty Commissioner position which should be filled shortly. The impact of these leadership changes is magnified as the FCC is currently undertaking several major rulemaking proceedings affecting areas such as intercarrier compensation and VoIP regulation, and Congress is rumored to be considering a rewrite of the Telecommunications Act of 1996. FCC Extends Truth-in-Billing Rules End users often voice frustration over the unnecessarily complicated task of deciphering line-item surcharges used in carrier invoicing. In a Second Report and Order, Declaratory Ruling, and Second Further Notice of Proposed Rulemaking released March 18, 2005, the FCC took preliminary steps to address this issue. In the Report and Order, the FCC expanded the applicability of its truth-in-billing rules to include wireless providers. Previously, wireless providers had enjoyed an exemption from the FCC’s requirement that charges contained on telephone bills be accompanied by a brief, clear, non-misleading, plain language description of the service rendered. The FCC eliminated this exemption for wireless providers, holding them to

Text Box: the same truth-in-billing standards as wireline providers. In addition, the FCC, based on what it characterized as a “tremendous amount” of confusion experienced by end-users over surcharges contained in carrier bills, began a rulemaking proceeding which may result in more sweeping reforms. Although public comment must first be taken and any eventual new rules are certainly several months away, the FCC often makes tentative conclusions that may indicate the direction of the rulemaking proceeding. One of the central requirements that the FCC indicated may be necessary would require carriers to keep line-item surcharges for government mandated fees separate from other non-mandated line-item surcharges. The Commission is also exploring whether to prohibit carriers from combining multiple regulatory surcharges into a single line-item. Many carriers contain blanket “regulatory surcharges” which purport to recover multiple fees and, presumably, other costs. The FCC stated its concern that where numerous charges are lumped into a single line-item, carriers are able to conceal the actual nature of the fees recovered through the charge. The Commission is also seeking comment on whether a nationwide line-item surcharge naming convention should be adopted. Under such a system, all carriers would be required to describe line-item surcharges in a uniform manner. Such a system would serve to increase the ability of end users to compare invoices between service providers, and, potentially, allow for more informed competition. End users and consultants may wish to participate in the notice and Continued on Page 6 ò