20091029Application.pdf

Greenberg
Traurig R. i:,. c '"I... ,.! 'i. ;)
L009 OCT 29 AM 9= 25
Debra McGuire Mercer
Tel [phone]
Fax [phone]
mercerdml§gtlaw.com
October 28, 2009
VIA OVERNIGHT DELIVERY 'Tp:w-t-~oq-Q(
Jean Jewell
Commission Secretar
Idaho Public Utilities Commission
472 West Washington
Boise, Idaho 83702
Re: Application of TracFone Wireless Inc. for Designation as an Eligible
Telecommunications Carer
Dear Ms. Jewell:
Enclosed please find an original and seven (7) copies of an Application of TracFone
Wireless, Inc. ("TracFone") for Designation as an Eligible Telecommunications carer in the
State of Idaho for the Limited Purose of Offering Lifeline Service to Qualified Households. An
additional copy of the Application is included to be date-staped and retured in the enclosed
envelope. Please contact me if you have any questions about this submission.
Sincerely,£U~~
Debra McGuire Mercer
Counsel for TracFone Wireless, Inc.
Greenberg Traurig, LLP I Attorneys atLaw I 2101 L Street, NW I Suite 1000 I Washington, D.C. 20037 I Tel 202.331.100 I Fax 202.331.101 I ww.gtlaw.com
REC D
Before the
IDAHO PUBLIC UTILITIES COMMISSION 2009 OCT 29 AM 9= 25
)In the Matter of )
)
Application of TracFone Wireless, Inc. )
for Designation as an Eligible Telecommunications )
Carrier in the State of Idaho for the Limited Purpose )
of Offering Lifeline Service to Qualified Households )
)
)
IDAHO hkU.;
UTILITIES COMMISSION
Docket No.trW -1- -09 -0 L
APPLICATION OF TRACFONE WIRELESS, INC.
FOR DESIGNATION AS AN ELIGIBLE TELECOMMUNICATIONS CARRER
IN THE STATE OF IDAHO FOR THE LIMITED PURPOSE OF
OFFERING LIFELINE SERVICE TO QUALIFIED HOUSEHOLDS
Mitchell F. Brecher
Debra McGuire Mercer
GREENBERG TRAURIG, LLP
2101 L Street, NW
Suite 1000
Washington, D.C. 20037
Telephone: [phone]
Facsimile: [phone]
brecherm~gtlaw.com
mercerdm~gtlaw.com
Counsel for TracFone Wireless, Inc.
October 28,2009
TABLE OF CONTENTS
Page
1. TracFone's Universal Service Offering. ..............................................................................2
II. TracFone Meets the Requirements For Designation as an Eligible
Telecommunications Carrier to Serve the Designated Areas in the State of
Idaho. ...................................................................................................................................4
A. The Idaho Public Utilties Commission Has Jurisdiction to
Designate TracFone as an ETC................................................................................5
B. TracFone Wil Provide Service Through Resale. ....................................................7
C. TracFone Offers All Required Services and Functionalities. ..................................9
1. Voice Grade Access to the Public Switched Network.................................9
2. Local Usage. ..............................................................................................10
3. Dual Tone Multi-Frequency ("DTMF") Signaling or Its
Functional Equivalent. .. ............................................................................ .11
4. Single-party service or Its Functional Equivalent............... ................... ...11
5. Access to 911 and E911 Emergency Service.............................................l 1
6. Access to Operator Services. .................................................................... .12
7. Access to Interexchange Service. ............................................................ ..12
8. Access to Directory Assistance. .................................................................13
9. Toll Limitation for Qualified Low-Income Customers. ............................13
D. TracFone Wil Be Able to Serve the Designated Areas Within a
Reasonable Time................................................................................................... .13
E. Service Quality Commitments. .. ........... ............ ..................... ....... ......... .............. ..14
F. TracFone Wil Advertise the Availabilty of Supported Services. ........................14
G. TracFone Wil Comply with the Lifeline Certification and
Verification Requirements in 47 C.F.R. § 54.410. ................................................16
H. TracFone Requests Designation Throughout Its Service Area in
Idaho. .....................................................................................................................16
III. Designation of TracFone as an ETC in the State ofIdaho Would Serve the
Public Interest. ................ ....................................... ............................. .............................. .17
A. The Benefits ofIncreased Competitive Choice. ............................ ............. ......... ..20
B. Unique Advantages of TracFone's Service Offerings. ..........................................21
TracFone SafeLink Wireless Lifeline Plan................................................21
C. Impact on the Universal Service Fund...................................................................23
D. Designation of TracFone as an ETC Wil Benefit the Public
Interest of Consumers Throughout Idaho. ................ ............. ......... .... ................. ..24
CONCLUSION ..............................................................................................................................25
ii
TABLE OF EXHIBITS
Exhibit
Declaration of F.J. Pollak, President and Chief Executive Officer, TracFone
Wireless, Inc. .............................................. ...... ...... .............. ............ .................................. .......... .....1
Petition of TracFone Wireless, Inc. for Forbearance from 47 USC §214(e)(l)(A)
and 47 CFR § 54.20lCi), 20 FCC Rcd 15095 (2005).........................................................................2
In the Matter of Federal-State Joint Board on Universal Service: TracFone
Wireless, Inc. Petition for Designation as an Eligible Telecommunications Carier
in the State of New York et aI., 23 FCC Rcd 6206 (2008) ...............................................................3
State Utilty Commission Decisions Designating TracFone Wireless, Inc. as an
Eligible Telecommunications Carier ................................................................................................4
Federal-State Joint Board on Universal Service, et aI., CC Docket No. 96-45, FCC
09-17 (released March 5, 2009) ........................................................................................................5
SafeLink Wireless Privacy Policy .....................................................................................................6
Lifeline advertisements and webpage................................................................................................ 7
SafeLink Wireless Terms and Conditions .........................................................................................8
11
RECEIV
Before the
IDAHO PUBLIC UTILITIES COMMISSION 20n9 OCT 29 AM 9= 25
lDt\HOPUE;LIC
UTILITIES COMMISSlON
)In the Matter of )
)
Application of TracFone Wireless, Inc. )
for Designation as an Eligible Telecommunications )
Carier in the State of Idaho for the Limited Purose )
of Offering Lifeline Service to Qualified Households )
)
)
Docket No.n 1.-t--o'1 -0\
APPLICATION OF TRACFONE WIRELESS, INC.
FOR DESIGNATION AS AN ELIGIBLE TELECOMMUNICATIONS CARRER
IN THE STATE OF IDAHO FOR THE LIMITED PURPOSE OF
OFFERING LIFELINE SERVICE TO QUALIFIED HOUSEHOLDS
TracFone Wireless, Inc. ("TracFone"), by its undersigned counsel, and pursuant to
Section 214(e)(2) of the Communications Act of 1934, as amended (the "Communications Act"),
hereby submits this Application for Designation as an Eligible Telecommunications Carrier
("ETC") in the State of Idaho. TracFone seeks ETC designation solely to provide Lifeline
service, under the trade name SafeLink Wireless, to qualifying Idaho consumers; it wil not seek
access to funds from the federal Universal Service Fund ("USF") for the purpose of providing
service to high cost areas. i As demonstrated herein, and as certified in Exhibit 1 to this
Application, TracFone meets all the statutory and regulatory requirements for designation as an
i Given that TracFone only seeks Lifeline support from the low-income program and does not
seek any high-cost support, ETC certification requirements for the high-cost program are not
applicable to TracFone.
ETC in the State of Idaho? TracFone respectfully requests that the Idaho Public Utilties
Commission ("Commission") grant this Application and that it do so expeditiously so that
TracFone may provide Lifeline service to low income households at the earliest practicable time.
I. TracFone's Universal Service Offering.
TracFone is incorporated under the laws of the State of Delaware and is headquarered at
Miami, Florida. Its corporate offces are located at 9700 N.W. 112th Avenue, Miami, FL 33178.
TracFone is a reseller of commercial mobile radio service ("CMRS") throughout the United
States, including the State of Idaho. TracFone provides service through a "virtual network"
consisting of services obtained from numerous licensed operators of wireless networks.
TracF one has provided CMRS service throughout the State of Idaho continuously for the past ten
years. In Idaho, TracFone obtains service from several underlying carriers, including AT&T
Mobility, T-Mobile, and Verizon Wireless. TracFone's arangements with these providers
enable it to offer services wherever any of those providers offer service in the State of Idaho.
With more than eleven milion customers nationwide, TracFone is the leading provider of
prepaid wireless service in the United States.
TracFone, through its arangements with its underlying carriers, has the abilty to provide
all services and functionalities supported by the universal service program, as detailed in Section
54.l01(a) of the Federal Communications Commission ("FCC") Rules (47 C.F.R. § 54.l01(a))
and ETC Checklist ii A,2 throughout Idaho. Upon designation as an ETC, TracFone wil make
2 See In the Matter of the Application of WWC Holding Co., Inc. DBA Cellular-QneQn Seeking
Designation as an Eligible Telecommunications Carier That May Receive Federal Universal
Service Support, Order No. 29841, Case No. WST-T-05-1 (Idaho Pub. Utilities Comm'n:
August 4, 2005) ("Idaho ETC Order"). ETC designation, certification and reporting
requirements are contained in the Appendix to the Idaho ETC Order, referenced as "ETC
Checklist" in this Application.
2
available to consumers a Lifeline offering which wil provide consumers with all of the
functionalities and features currently provided by TracFone to existing customers. TracFone wil
provide Lifeline service to qualifying customers requesting these services pursuant to the
universal service program and in accordance with 47 C.F.R. § 54.202(a)(l).
TracFone's Lifeline offerings wil differ from other ETCs' Lifeline programs in several
very important respects. For one thing, TracFone wil offer low income consumers the
convenience and portabilty of wireless services. TracFone believes that many Lifeline-eligible
consumers will take advantage of the opportunity to obtain subsidized wireless service. In
addition, unlike any other ETC's Lifeline programs, TracFone's Lifeline service wil provide
quantities of wireless usage at no charge to the consumer. Stated simply, TracFone's Lifeline
service wil be free! Typically, Lifeline programs provide participating consumers with
discounts below carriers' standard rates. However, participating customers stil must pay the
discounted rates and face service disconnection if they fail to pay the amounts owed. For
example, if a provider's standard monthly charge is $30.00 and the Lifeline customer receives a
$10.00 discount funded by the USF, the customer stil receives an invoice for $20.00, plus
additional charges incurred during the billng period. TracFone's Lifeline customers wil also
receive a free wireless handset. Thus, TracFone's Lifeline customers will be able to initiate and
receive calls from their wireless phones while incuring no activation or usage charges.
TracFone's Lifeline plan is described at Section IILB of this Application.
Indeed, even without classification as an ETC, TracFone currently operates in accordance
with the spirit of universal service. Because TracFone utilzes the networks of many licensed
CMRS providers, TracFone service is available virtually nationwide (including throughout the
3
State ofIdaho). Moreover, TracFone service is available at nationally-uniform rates. TracFone
service is priced the same at all locations in Idaho, and throughout the United States.
II. TracFone Meets the Requirements For Designation as an Eligible
Telecommunications Carrier to Serve the Designated Areas in the State of Idaho.
Section 254( e) of the Communications Act provides that "only an eligible
telecommunications carrier designated under section 214( e) shall be eligible to receive specific
federal universal service support." Section 214(e)(2) of the Communications Act provides that a
State commission "shall . . . upon request designate a common carrier that meets the
requirements of paragraph 1 (of Section 214(e)) as an eligible telecommunications carier for a
service area designated by the State commission."
As demonstrated below, and as set forth in the Declaration of F.J. Pollak, TracF one's
President and Chief Executive Officer, Exhibit 1, TracFone meets the requirements for ETC
designation by the Commission pursuant to Section 214( e )(2) of the Communications Act and
the ETC Checklist. TracFone complies with the standards established by the FCC for
determining whether applicants for ETC status serve the public interest.3 TracFone recognizes
that Section 214(e)(l)(A) of the Communications Act states that ETCs shall offer services, at
least in part, over their own facilities and that Section 54.201(i) of the FCC's Rules (47
C.F.R. § 54.201(i)) prohibits state commissions from designating as an ETC a
telecommunications carrier that offers services exclusively through the resale of another
carrier's services. However, as described at Section II.B of this Application, on June 8, 2004,
TracFone fied with the FCC a petition requesting that the FCC exercise its forbearance authority
under Section 10 of the Communications Act (47 U.S.C. § 160) with respect to the facilties-
3 See Federal-State Joint Board on Universal Service, Report and Order, 20 FCC Rcd 6371, ~ii
40-43 (2005).
4
based service requirement.4 The FCC granted the petition for forbearance in an Order dated
September 8, 2005.5 In an Order dated April 11, 2008, the FCC granted all of TracFone's
pending petitions for designation as an ETC, subject to the conditions set forth in the TracFone
Forbearance Order.6
A. The Idaho Public Utilties Commission Has Jurisdiction to Designate
TracFone as an ETC.
Section 214( e )(2) of the Communications Act authorizes state commissions, such as the
Idaho Public Utilties Commission, to designate ETC status for federal universal service
purposes.7 Indeed, "state commissions have the primar responsibility for the designation of
eligible telecommunications carrers under Section 214( e )(2). ,,8 Although Section 332( c )(3)(A)
of the Communications Act prohibits states from regulating the entry of or the rates charged by
any provider of commercial mobile service or any private mobile service, this prohibition does
4 See TracFone Wireless, Inc. Petition for Forbearance, CC Docket No. 96-45, filed June 8,
2004, as amended by TracFone Wireless, Inc. Amendment to Petition for Designation as an
Eligible Telecommunications Carrier in the State of Florida, CC Docket No. 96-45, fied August
16, 2005 and TracFone Wireless, Inc. Clarification of Petition for Forbearance, CC Docket No.
96-45, fied September 24, 2004 ("Petition for Forbearance").
5 Petition of TracFone Wireless, Inc. for Forbearance from 47 USC § 214(e)(1)(A) and 47 CFR §
54.201 (i), 20 FCC Rcd 15095 (2005) ("TracFone Forbearance Order"). A copy of the TracFone
Forbearance Order is attached as Exhibit 2.
6 In the Matter of Federal-State Joint Board on Universal Service: TracFone Wireless, Inc.
Petition for Designation as an Eligible Telecommunications Carier in the State of New York et
aI., 23 FCC Rcd 6206 (2008) (granting TracFone's ETC Petitions for Alabama, Connecticut,
Delaware, District of Columbia, Massachusetts, New Hampshire, New York, North Carolina,
Pennsylvania, Tennessee, and Virginia) ("TracFone ETC Order"). A copy of the TracFone ETC
Order is attached as Exhibit 3.
7 See Federal-State Joint Board on Universal Service, First Report and Order, 12 FCC Rcd 8776,
8858-59, ii 145 (1997) ("USF Order").
8 Federal-State Joint Board on Universal Service, Twelfh Report and Order and Further Notice
of Proposed Rulemaking, 15 FCC Rcd 12208, ii 93 (2000).
5
not allow states to deny wireless cariers ETC status.9 Therefore, the Idaho Public Utilties
Commission is authorized to designate TracFone as an ETC. In fact, the Commission has
designated wireless cariers as ETCs.10
Section 214( e )(2) of the Communications Act provides that a State commission shall
designate a common carrier as an ETC, if the carrier meets the requirements of Section
214(e)( 1). Section 214( e)( 1) requires a carrier designated as an ETC to offer the services that are
supported by Federal universal service support mechanisms using its own facilties or a
combination of its own facilties and resale of another carer's services and to advertise the
availability of such services and the related charges using media of general distribution. As
discussed in Section II.D. of this Application, TracFone wil advertise the availability of its
Lifeline plan and the associated charges using media of general distribution.
As noted above, the FCC decided to forbear from applying the facilities-based
requirement for ETCs to TracFone. Section lO(e) of the Communications Act (47 U.S.C. §
160(e)) provides: "(a) State commission may not continue to apply or enforce any provision of
this chapter that the (Federal Communications) Commission has determined to forbear from
applying under subsection (a) of this section." As such, the Idaho Public Utilities Commission is
required by Section 10(e) to act in accordance with the FCC's TracFone Forbearance Order, and
therefore, may not apply the facilties-based requirement to TracFone. Indeed, eleven state
9 USF Order, at 8858-59, ii 145.
10 See In the Matter of the Petition of Edge Wireless, LLC for Designation as an Eligible
Telecommunications Carier under Section 47 U.S.C. § 214(e)(2), Order No. 30360, Case No.
EDG-T-07-01 (Idaho Pub. Utilties Comm'n: July 2, 2007).
6
utility commissions already have complied with the FCC's Forbearance Order and have
designated TracFone as an ETC in those states.
1 1
B. TracFone Wil Provide Service Through Resale.
In the TracFone Forbearance Order, the FCC granted TracFone's Petition for
Forbearance subject to certain conditions. The FCC explained that requiring "TracFone, as a
wireless reseller, to own facilities does not necessarily further the statutory goals of the low-
income program, which is to provide support to qualifying low-income consumers throughout
the nation, regardless of where they live.,,12 The FCC also stated that grant of TracFone's
petition for forbearance "serves the public interest in that it should expand participation of
qualifying consumers" in the under-utilized low-income program.
13 The low income program
supported by the Universal Service Fund includes the Lifeline program.
The FCC's grant of forbearance is subject to the following conditions: (a) TracFone
providing Lifeline customers with basic 911 and enhanced 911 ("E911 ") access regardless of
activation status and availabilty of prepaid minutes; (b) TracFone providing its new Lifeline
customers with E911-compliant handsets and replacing any existing customers' non-compliant
handsets at no additional charge; (c) TracFone complying with conditions (a) and (b) as of the
date it provides Lifeline service; (d) TracFone obtaining a certification from each Public Service
Answering Point ("PSAP") where TracFone provides Lifeline service confirming that TracFone
complies with condition (a); (e) TracFone requiring its customers to self-certify at the time of
ii State utility commissions in the following states have designated TracFone as an ETC:
Florida, Georgia, Ilinois, Maryland, Michigan, Missouri, New Jersey, Ohio, Texas, West
Virginia and Wisconsin. A list of the state utilty commission orders is attached as Exhibit 4.
12 TracFone Forbearance Order, ii 23.
13 Id. ~ 24.
7
service activation and annually thereafter that they are the heads of the households and receive
Lifeline-supported service only from TracFone; and (f) TracFone establishing safeguards to
prevent its customers from receiving multiple TracFone Lifeline subsidies at the same address.
The FCC required TracFone to describe how it would implement each of these
conditions. In October 2005, TracFone described to the FCC how it would comply with each of
the FCC's stated conditions. TracFone committed to providing all Lifeline customers with
access to basic and E911 service even if the customer has no remaining prepaid minutes on his or
her handset. TracFone furher represented that it wil provide new Lifeline customers with an
E911-compliant handset and will replace any existing customers' non-E911-compliant handsets
with a compliant handset free of charge at the time such customers enroll in Lifeline. TracFone
also stated that its Lifeline enrollment forms wil require each applicant to certify under penalty
of perjury that he or she is the head of the household and that he or she receives Lifeline service
only fromTracFone. In addition, TracFone explained that its enrollment form wil require each
applicant to list a primar residential address which TracFone wil use to check its customer
records to ensure that the applicant is not receiving Lifeline service for more than one handset
associated with a paricular address. TracFone also wil verify anually that its Lifeline
customers are stil heads of households and that they only receive Lifeline service from
TracFone. In the TracFone ETC Order, the FCC approved TracFone's plan for complying with
those conditions.
14
The PSAP certification condition imposed by the FCC was difficult to implement and
resulted in delaying the availability of TracFone's SafeLink Wireless Lifeline service in several
jurisdictions. On November 21, 2008, TracFone petitioned the FCC to modify the PSAP
14 TracFone ETC Order, ii 23.
8
certification condition. On March 5, 2009, the FCC issued an Order granting TracFone's request
to modify the requirement that TracFone obtain a certification from each PSAP where TracFone
provides Lifeline service confirming that it provides its customers with access to basic and E911
service.
15 The FCC modified the PSAP certification to require the following: TracFone must
stil request such certification from each PSAP within its Lifeline service area; however, if
within 90 days of TracFone's request, a PSAP has not provided the certification and the PSAP
has not made an affrmative finding that TracFone does not provide its customers with access to
911 and E911 service within the PSAP's service area, TracFone may self-certify that it meets the
basic and E911 requirements.
C. TracFone Offers All Required Services and Functionalities.
TracFone offers, or wil offer upon designation as an ETC in Idaho, all of the services
and functionalities required by Sections 54.l01(a) and 54.202(a) of the FCC's Rules (47 C.F.R.
§§ 54.1 01 (a), 54.202(a)) and ETC Checklist, ii A,2 including the following:
16
1. Voice Grade Access to the Public Switched Network.
Voice grade access to the public switched telecommunications network ("PSTN") means
the abilty to make and receive traditional voice phone calls between the approximately 500
Hertz and 4,000 Hertz for a bandwidth of approximately 3500 Hertz.17 The voice grade access
15 Federal-State Joint Board on Universal Service, et aI., CC Docket No. 96-45, FCC 09-17
(released March 5, 2009) (attached as Exhibit 5).
16 The FCC's Rules require an applicant for ETC status to demonstrate that it satisfies network
build-out and improvement requirements (47 C.F.R. § 54.202(a)(1)(ii)) and to provide a
certification that it acknowledges that the FCC may require it to provide equal access to long
distance carriers in the event that no other ETC is providing equal access within the service area
(47 C.F.R. § 54.202(a). In the TracFone ETC Order, the FCC determined that TracFone was not
required to make these showings because it is a pure reseller. See n.35. TracFone maintains that
it also is not required to make these showings for this Application.
17 See USF Order, at 8810-11, iiii 63-64; see 47 C.F.R. § 54.l01(a)(l).
9
provided by TracFone enables a user of telecommunications services to transmit voice
communications, including signaling the network that the caller wishes to place a call, and to
receive voice communications, including receiving a signal indicating there is an incoming call.
2. Local Usage.
As part of the voice grade access to the PSTN, an ETC must provide local callng
pursuant to 47 C.F.R. § 54. 10 1 (a)(2). TracFone provides subscribers the abilty to send and
receive local phone calls wherever it provides service. Moreover, local usage is included in
TracFone's callng plan. FCC Rule54.202(a)(4) requires an ETC applicant to "demonstrate that
it offers a local usage plan comparable to the one offered by the incumbent LEC in the service
areas for which it seeks designation." The FCC has explained that an ETC applicant's local
usage plans should be reviewed on a case-by-case basis to ensure that each ETC provides a local
usage component in its universal service offering that is comparable to the plan offered by the
incumbent LEC in the area.18 Importantly, the requirement is that ETCs offer local usage plans
"comparable" to those of the ILEC, not that the plans be identicaL. The FCC has not adopted any
minimum local usage requirements.
19 As a designated ETC, TracFone wil comply with any
applicable minimum local usage requirements adopted by the FCC.
Wireless and wireline services, though increasingly substitutable for each other, are
different from each other and they are priced differently. Unlike any ILECs' or other ETCs'
Lifeline plans, TracFone's Lifeline offerings wil go beyond those of other providers in a very
important respect: TracFone's Lifeline customers wil receive as par of Lifeline service
specified amounts of free wireless service. That is, Lifeline customers wil be able to use
18 Federal-State Joint Board on Universal Service, Report and Order, 20 FCC Rcd 6371, 6385, ii
33 (2005).
19 Id. ii 32.
10
TracF one's service to initiate and receive specified amounts of wireless callng -- local and long
distance -- with no charge to the customers.
3. Dual Tone Multi-Frequency ("DTMF") Signaling or Its Functional
Equivalent.
DTMF signaling allows cariers to provide expeditious call set-up and call detail
information and enables modem usage.20 The FCC permits cariers to provide signaling that is
functionally equivalent to DTMF to satisfy the DTMF requirement. All telephone handsets
provided by TracFone are DTMF-capable as required by 47 C.F.R. § 54.l01(a)(3).
4. Single-part service or Its Functional Equivalent.
Single-party service means that only one party wil be served by a subscriber line or
access loop in contrast to a multi-pary line.21 TracFone provides customers with single-party
access for the duration of every phone call in accordance with 47 C.F.R. § 101(a)(4). TracFone
does not provide "multi-pary" or "pary line" services.
5. Access to 911 and E911 Emergency Service.
The FCC has declared that access to emergency services is essentiai.22 TracFone
provides universal access to the 911 system for its customers. TracF one has implemented. and
wil continue to implement enhanced 911 ("E911") services consistent with the FCC's Rules,
including 47 C.F.R. § 54.101(a)(5), and orders when such services are made available by the
carriers from whom TracFone purchases services. In particular, TracFone wil fully comply with
20 USF Order, 12 FCC Rcd at 8814, ii 71.
21 Id. at 8810, ii 62.
22 Id. at 8815, ii 72.
11
the FCC's E911 requirements applicable to wireless resellers?3 Pursuat to the FCC's E911
Order, providers that use other carriers' facilties to provide wireless voice service to customers
have an obligation to comply with the FCC's E911 rules "to the extent that the underlying
facilities-based licensee has deployed the facilties necessary to deliver enhanced 911
information to the appropriate PSAP (public service answering point).,,24 TracFone wil make .
available access to E911 service in accordance with applicable FCC requirements. In addition,
in accordance with 47 C.F.R. § 54.202(a)(2), TracFone has the abilty to remain functional in
emergency situations. As described in this Application, TracFone provides service in Idaho by
resellng services of underlying wireless network carriers, including AT&T Mobilty, T-Mobile,
and Verizon Wireless. Those network operators have implemented state-of-the-art network
reliabilty standards and TracFone and its customers benefit from their high stadards.
Throughout its ten years of existence, TracFone's service reliabilty has compared favorably with
that of any facilities-based operator in the wireless telecommunications industry.
6. Access to Operator Services.
TracFone offers all of its customers access to operator services, in accordance with 47
C.F.R. § 54.101(a)(6).
7. Access to Interexchange Service.
TracFone customers can use TracFone's services to complete toll calls as required by 47
C.F.R. § 54.101(a)(7). In fact, TracFone does not impose separate charges for interexchange
calls. Long distance callng is included in TracFone's service with no additional charge.
23 See Revision of the Commission's Rules to Ensure Compatibilty With Enhanced 911
Emergency Callng Systems, Report and Order and Second Further Notice of Proposed
Rulemaking, 18 FCC Rcd 25340 (2003).
24 Id. at 25378-79, ii 91.
12
8. Access to Directory Assistance.
All TracFone customers receive access to directory assistance service through the
TracFone virtual network as required by 47 C.F.R. § 54.101(a)(8). Specifically, all TracFone
customers, including those customers located in Idaho, have access to directory assistace
services provided by TracFone's vendors.
9. Toll Limitation for Qualified Low-Income Customers.
There is no need for TracFone to offer a toll limitation feature to qualifying low-income
customers. Since TracFone's service is a prepaid service, no customers wil be disconnected for
failure to pay toll charges or, for that matter, any other charges. TracFone treats long distance
minutes of use as any other usage and the customers are not charged separately for toll services.
Inasmuch as all TracFone services are prepaid there is no danger that low income customers wil
incur large charges for heavy toll (or other) callng and no risk that they wil be disconnected for
nonpayment. Since customers pay for the service in advance - they can use only what they
already have paid for or what service quantities they have been provided to them under the
Lifeline program. Thus, TracFone's prepaid services are especially beneficial to lower income
users since the consumers enjoy the abilty to control or limit their charges for toll service (as
well as local service) in a manner that customers of traditional post-paid (biled in arears)
services do not.
D. TracFone Wil Be Able to Serve the Designated Areas Within a Reasonable
Time.
TracFone provides service in Idaho by resellng service which it obtains from underlying
facilities-based providers. Each of those providers' networks are operational and are largely
built out. Thus, TracFone wil be able to commence offering its Lifeline service to all locations
served by any of its underlying cariers very soon after receiving approval from the Idaho Public
13
Utilities Commission. Indeed, it already serves those areas. The only delay will be the time
needed to implement procedures and internal systems to offer the Lifeline program. Thus,
TracFone wil be able to provide Lifeline service to all qualified customers on a timely basis or
within a reasonable period of time in accordance with 47 C.F.R. § 54.202(a)(l).
E. Service Quality Commitments.
As a reseller of other cariers' wireless services, TracFone's service is of the same quality
and reliabilty as that of its underlying vendors. TracFone canot assure the Commission that it
wil never experience service disruptions. Occasional dropped calls and inconsistent coverage
depending on atmospheric conditions are a fact of life in the wireless industry. TracFone
believes that its service is as reliable as that of any other wireless provider serving the Idaho
market. To demonstrate its commitment to high service quality, TracFone wil comply with the
CTIA - The Wireless AssociationQn Consumer Code for Wireless Service in accordance with 47
C.F.R. § 54.202(a)(3). In addition, TracFone's Privacy Policy for its SafeLink Wireless Lifeline
service is available to all customers on its website at http://ww.safelink.com and it is attached
as Exhibit 6.
F. TracFone Wil Advertise the Availabilty of Supported Services.
TracFone will aggressively advertise the availabilty of its Lifeline service and the
associated charges using media of general distribution, in accordance with the requirements of
Section 214(e)(1)(A) of the Communications Act, Section 54.201(d)(2) of the FCC's Rules (47
C.F.R. § 54.201(d)(2)), and ETC Checklist, ii A,3. TracFone plans to utilze such marketing and
outreach efforts as necessary and appropriate to ensure that as many eligible consumers as
possible avail themselves of TracFone's prepaid wireless Lifeline offering. TracFone
understands that it wil be competing with other ETCs in Idaho, including the incumbent local
14
exchange cariers, to be chosen by consumers to be their Lifeline service provider. TracFone
wil utilze traditional means for promoting the availability of its Lifeline program. These means
wil include print and broadcast advertising in media outlets most likely to reach consumers
eligible for Lifeline. These would include national publications as well as local and community
newspapers, and commercial broadcast stations, especially those stations whose programing is
targeted to significant lower income communities including, for example, Spanish language
stations in areas with significant Spanish-speaking populations. Examples of TracFone's
advertisements for SafeLink Wireless Lifeline service are attached as Exhibit 7.
The Commission should be aware that TracFone has had previous experience marketing
Lifeline service and was profoundly successfuL. In October 2005, following the devastation
caused by Hurricane Katrina, the FCC established a special Lifeline program which enabled
wireless providers to be designated as ETCs to offer a one-time Lifeline service to persons in the
states of Louisiana, Mississippi, and Alabama who had been displaced by the hurricane.25
TracFone was one of the first providers to be designated as an ETC under the FCC's Huricane
Katrina program. Within a period of several months, TracFone was able to enroll nearly 30,000
huricane victims in its Lifeline program using marketing efforts similar to those proposed
herein, as well as other methods intended to address the special challenges of reaching out to
potential Lifeline customers who had lost their homes, and were residing in temporary locations -
- often far away from their home communities. TracFone believes that its advertising and
outreach efforts detailed above wil result in increased paricipation in the Lifeline program. The
25 Federal-State Joint Board on Universal Service, 20 FCC Rcd 16883 (2005). Under the
Huricane Katrina Lifeline program, ETCs provided $130.00 in support to qualified customers in
the form of a free wireless handset and at least 300 free minutes. If the subscriber did not need a
handset, then the subscriber could opt instead for a Lifeline-supported package of greater than
300 minutes. Id. iiii 13,22.
15
Commission's grant of TracFone's ETC Application wil promote the important goal of
increasing Lifeline paricipation.
G. TracFone Wil Comply with the Lifeline Certification and Verification
Requirements in 47 C.F.R. § 54.410.
Section 54.410 of the FCC's Rules require ETCs to comply with certification of
eligibilty and verification of continued eligibility requirements for Lifeline paricipation.
TracFone wìl certify and verify consumer eligibilty in accordance with the FCC's requirements
and with Commission rules that apply to ETCs seeking funds from the federal USF. TracFone
wil petition this Commission for waiver of any rules that impose certification and verification
requirements that differ from the FCC's requirements.
H. TracFone Requests Designation Throughout Its Service Area in Idaho.
TracFone wil offer Lifeline service in all areas in Idaho that are served by AT&T
Mobilty and T-Mobile. In the second quarer of2010, TracFone wil expand its Lifeline service
area to include the areas in Idaho served by Verizon Wireless. TracFone requests ETC
designation statewide in all exchanges to the extent that its underlying carriers, including
Verizon Wireless, have facilties and coverage. TracFone reiterates the fact that it is applying for
ETC designation solely to utilze USF fuding to provide Lifeline service tò qualified low
income consumers. It does not seek and wil not accept high cost support. Therefore, its
designation as an ETC will cause no growth in the high cost portions of the USF and wil not
erode high cost support from any rual telephone company. The Commission may designate
TracFone as an ETC in non-rual areas that TracFone serves without redefining the service areas
of non-rual telephone companies. The Commission may designate TracFone as an ETC in rual
telephone company service areas upon a finding that such designation would serve the public
16
interest. 26
III. Designation of TracFone as an ETC in the State of Idaho Would Serve the Public
Interest.
As noted above, TracF one seeks certification as an ETC in areas served by rual
telephone companies, as well as in areas served by non-rural telephone companies.
Consequently, the Communications Act requires that the Commission determine that TracFone's
designation as an ETC would serve the public interest.27
The FCC has determined that "( d)esignation of competitive ETCs promotes competition
and benefits consumers in rual and high-cost areas by increasing customer choice, innovative
services, and new technologies.,,28 This is particularly applicable in the rural areas served by
TracFone within the State of Idaho -- areas that in most cases are not presently served by
competitive wire line carriers that could provide an alternative to the incumbent LECs.
Designation of TracFone as an ETC wil provide a valuable alternative to the existing
telecommunications services available in these areas. Those public interest benefits include
larger local callng areas, the convenience and security afforded by mobile telephone service, the
opportunity for customers to control their costs by purchasing in advance only the volumes of
service which they need and supplementing those quantities on an "as needed" basis after
exhausting their monthly supply of free service, and, availabilty of E911 service in accordance
26 See 47 C.F.R. § 54.207(c).
27 47 U.S.C. § 214(e)(2); see Federal-State Joint Board on Universal Servìce, 20 FCC Rcd 6371,
~ 42 (2005) ("We find that before designating an ETC, we must make an affirmative
determination that such designation is in the public interest, regardless of whether the applicant
seeks designation in an area served by a rural or non-rural carrier."); see also ETC Checklist, ii
A,4 (requiring a demonstration of public interest).
28 See Western Wireless Corporation Petition for Designation as an Eligible Telecommunications
Carier in the State of Wyoming, Memorandum Opinion and Order, 16 FCC Rcd 48,55 (2000).
17
with the FCC's E911 requirements. In addition, TracFone's inclusion of toll callng within its
calling plans wil enable consumers to avoid the risk of becoming burdened with large and
unanticipated charges for toll callng.
TracFone's SafeLink Wireless Lifeline service offers important benefits that are
especially needed by low income Idaho residents in this time of economic downtur. As the
Commission is aware, the Dow Jones Industrial Average, a primary indicator of the health of the
economy, has substantially declined since 2008. Thus, the savings accounts upon which many
Idaho residents depend for emergencies and for retirement have been significantly eroded.
According to the United States Bureau of Labor Statistics, as of September 2009, Idaho
experienced an unemployment rate of 8.8 percent.29 These conditions have had a significant
impact on Idaho residents.
As noted above, the availabilty of a regular mobile telephone wil be critical to many of
those unemployed Idaho residents' efforts to search for other employment opportunities.
Without a mobile telephone, unemployed individuals face extreme difficulty in finding a job. A
mobile telephone allows individuals to be reached at any time and location and enables
unemployed individuals to respond to potential employers immediately. In addition, a mobile
telephone assists employed low-wage individuals by allowing those individuals to stay in contact
with employers, manage relationships with supervisors, and respond to requests to work
additional shifts or hours. TracFone's SafeLink Wireless Lifeline program will enable thousands
of Idaho residents, including many who have been adversely impacted by the failing economy or
job loss, to obtain a handset and wireless service, which would otherwise be unavailable to them,
29 Bureau of Labor Statistics, Local Area
http://ww.bls.gov/lau/ome.htm. viewed on October 27, 2009.
Unemployment Statistics,
18
to assist in emergency situations, facilitate job search efforts, and to maintain contact with family
members.
The dire economic situation facing an increasing number of Idaho residents indicates that
now, more than ever, low income individuals can greatly benefit from the advantages offered by
TracFone's SafeLink Wireless Lifeline service. TracFone's SafeLink Wireless Lifeline service
wil allow low income Idaho residents, including many who have been adversely impacted by
the failng economy or job loss, to have access to free wireless service to assist in emergency
situations, facilitate job search efforts, and to maintain contact with family members.
Designation of TracFone as an ETC wil also provide an incentive to the incumbent LECs
serving those portions of the state to improve their existing networks in order to remain
competitive, resulting in improved services to consumers. Designation of TracFone as an ETC
wil also benefit consumers because support to services provided by TracFone wil help assure
that quality services are available at "just, reasonable, and affordable rates" as envisioned in the
Communications Act.3o
The FCC has identified factors to be considered in determining whether designation of an
additional ETC would serve the public interest. These factors require the Commission to weigh
whether the benefits of an additional ETC would outweigh potential harms. The factors to be
considered include: 1) the benefits of increased competitive choice; and 2) the unique
advantages of the applicant company's service offerings.31 As described in the following
paragraphs, TracF one meets these criteria.
30 See 47 U.S.C. § 254(b)(1).
31 See 47 C.F.R. § 54.202(c).
19
A. The Benefits of Increased Competitive Choice.
The benefits to consumers of being able to choose from among a variety of
telecommunications service providers have been acknowledged by the FCC for more than three
decades.32 However, the benefits of competitive choice are especially valuable in situations in
which wireless providers like TracFone seek to provide service to rural communities and
elsewhere. As the FCC recognized in Highland Cellular, some households in rural communities
do not have access to the public switched network through the incumbent local exchange carrier.
Moreover, the availability of a wireless competitive alternative benefits those rural consumers
who often must drive significant distaces to work, schools, stores, and other community
locations.33 TracFone's prepaid wireless service alternative wil provide consumers with
convenient and affordable telecommunications service, both from their residences and when they
are away from their homes.
TracFone believes that many consumers, including qualified Lifeline customers, view the
portabilty and convenience of wireless service as a modem necessity, not a luxury. Parents need
to be able to reach their children wherever they may be (and vice versa); persons seeking work
need to be reachable by potential employers; persons need to call for emergency assistance while
away from home. According to FCC data, Idaho's statewide Lifeline paricipation rate is only
22.1 percent of eligible households.34 In other words, nearly eighty percent of low income Idaho
32 See,~, Specialized Common Carrier Services, 29 FCC2d 870 (1971).
33 Highland Cellular, Inc. Petition for Designation as an Eligible Telecommuncations Carer in the
Commonwealth of Virginia, 19 FCC Rcd 6422, ii 23 (2004).
34 See In the Matter of Lifeline and Link-Up, Report and Order and Further Notice of Proposed
Rulemaking, FCC 04-87 (April 29, 2004) Table l.A. The Universal Administrative Company
estimates that in 2008 the participation rate for eligible households in Idaho was between twenty
and fifty percent (20-50%). See 2008 Paricipation Rates by State, available at
http://ww . usac.org/li/ about/participation-rate- information.aspx.
20
households which are eligible to paricipate in Lifeline are not doing so. TracFone expects that
qualified consumers wil elect to paricipate in Lifeline, if a wireless option is available.
B. Unique Advantages of TracFone's Service Offerings.
As described elsewhere in this Application, TracFone's entire business model is
predicated on providing easy-to-use, pay-as-you-go, affordable wireless telecommunications
service to consumers to whom wireless service would be otherwise unavailable or unaffordable.
TracFone offers consumers an opportunity to acquire wireless service using state-of-the-art
handsets and such features as caller ID, voice mail, text messaging, and long distance callng
without toll charges. Because TracFone's service requires no term contracts, no minimum
service periods or volume commitments, no credit checks, and no early termination fees, the
service is available to everyone - irrespective of age; irrespective of residency; irrespective of
creditworthiness. Moreover, TracFone's prepaid service is unique in that usage information and
remaining balance information is stored in the handsets and is thus available to consumers on a
"real-time" basis. TracFone's prepaid service offers Lifeline-qualified customers access, quality
and price. None of the incumbent providers nor those other non-incumbent ETCs serving the
areas covered by TracFone in Idaho offer service to consumers under comparable conditions.
TracFone wil offer the following Lifeline plan to its customers. Under the plan,
TracFone's customers wil receive free monthly service, free airtime each month, and a free
handset. A description of the Lifeline plan is as follows:
TracFone SafeLink Wireless Lifeline Plan
Each TracFone Lifeline customer wil be provided with a specified number of minutes of
use each month. The amount of free minutes of airtime to be provided wil be based on the
amount of federal USF low income support available pursuant to the rules of the FCC. TracFone
21
wil calculate the number of minutes each Lifeline customer wil receive per month to ensure that
each Lifeline customer receives the full value of the Lifeline discount to which he or she is
entitled, based upon the amount of the Lifeline discount required by the Commission. Those
minutes wil be automatically added to each customer's prepaid account balance each month.
Unused minutes wil roll over from month-to-month so long as the customer remains enrolled in
the Lifeline program. In addition, Lifeline customers wil be allowed to purchase additional
usage cards at a rate of $0.20 per minute. TracFone pledges that one hundred percent of the
federal Lifeline support it receives wil be flowed through to Lifeline customers in the form of
free usage.35 The terms and conditions governing SafeLink Wireless Lifeline service are
attached as Exhibit 8.
TracFone wil make available handsets to its paricipating Lifeline customers at no
charge. TracFone's average cost of purchasing handsets is above $50.00 per unit. TracFone wil
pre-activate handsets provided to qualified customers,36 enroll the customers in the Lifeline plan,
and allocate the appropriate number of minutes of usage to the customers' accounts. The
handsets wil be delivered to customers upon enrollment in the program with the first month's
free usage allotment already activated. The phones wil remain active for one year even if no
additional usage is purchased. Low income customers who have limited access to
communications sources wil gain immediate and free access to wireless telecommunications
service simply by turning on the handsets provided by TracFone.
35 TracFone reserves the right to modify its Lifeline plan based on changes in market conditions
or the amount of USF support available. However, under the Lifeline plan, 100 percent of
federal and state required Lifeline support wil be provided to Lifeline customers in the form of
free usage.
36 Customers who do not qualify for Lifeline must purchase a handset and then activate it by
callng TracFone's Customer Care departent from a landline telephone or by completing a
form on TracFone's website.
22
C. Impact on the Universal Service Fund.
The FCC has considered the impact on the USF when determining whether to grant
TracFone's petitions for designation as an ETC.37 Whatever impact classification of TracFone as
an ETC wil have on the universal service fund wil be negligible. TracFone seeks ETC
designation solely to enable it to offer Lifeline benefits to eligible low income consumers.
TracFone does not seek access to fuds from the federal Universal Service Fund for the purpose
of obtaining high cost support. As noted in the FCC's TracFone Forbearance Order, "the
potential growth of the fund associated with high-cost support distributed to competitive ETCs"
is not relevant to cariers seeking support associated with the low-income program.38 In 2007,
low-income support accounted for only 11.8 percent of the distribution of the total universal
service fund, while high-cost support accounted for 61.6 percent.39 "Any increase in the size of
the fund (associated with granting TracFone's ETC application) would be minimal and would be
outweighed by the benefit of increasing eligible paricipation in the Lifeline program, fuhering
the statutory goal of providing access to low-income consumers.,,40 Indeed, the FCC has
acknowledged the benefits of designating a carrier as an ETC, when the carier only seeks to
paricipate in the USF's low income programs. The FCC included the following statement in a
May 1, 2008 Order in which it established an interim cap on high-cost support:
Moreover, there are advantages to obtaining and maintaining an ETC designation
regardless of whether a competitive ETC receives high-cost support. In
paricular, the abilty of competitive ETCs to receive low-income universal
service support shows value in obtaining and maintaining ETC designation
37 TracFone ETC Order, ~ 16 n.47.
38 TracFone Forbearance Order, ii 17.
39 Wireline Competition Bureau, Federal Communications Commission, Trends in Telephone
Service, Table 19.1 and Char 19.1 (2008).
40 TracFone Forbearance Order, ii 17.
23
separate and apar from high-cost support. Indeed, TracFone Wireless, Inc.
(TracF one) sought forbearance from section 214( e)( 1) of the Act so that it could
seek designation as an ETC eligible only to receive universal service Lifeline
support. TracFone took this step because "offering prepaid plans which make
wireless service available to low income users ... has been a critical component of
TracFone's business strategy since the company's inception." Other ETCs may
have similar business strategies. Furher, by offering Lifeline and Link Up
service, a competitive ETC may attract new subscribers that may not otherwise
have taken telephone service. This would increase a competitive ETC's base of
subscribers and, consequently, lower its average cost of serving all of its
subscribers. Moreover, competitive ETCs may be eligible for separate universal
service support at the state levelY
Furhermore, it is important to recognize the differences between low income fuding for
the Lifeline program and high cost funding. With Lifeline, ETCs only receive USF support for
customers they obtain. If TracFone acquires Lifeline customers curently served by other ETCs,
TracFone wil gain the Lifeline support for those customers, but the ETCs losing the customers
wil lose the support. TracFone wil only increase the amount of USF Lifeline funding in
situations where it obtains new Lifeline customers, i.e., customers not curently enrolled in other
ETCs' Lifeline programs. In contrast, with high cost support, when new ETCs enter the market
and capture customers from the existing ETCs, both the incumbent ETCs and the new ETCs
receive high cost support -- based on the incumbent LECs' costs, thereby increasing the size of
the USF.
D. Designation of TracFone as an ETC Wil Benefit the Public Interest of
Consumers Throughout Idaho.
In addition to meeting the public interest factors, TracFone, if designated as an ETC, wil
also serve the public interest because TracFone wil paricipate in the Lifeline program as
required by the FCC's Rules and wil otherwise comply with all FCC and Commission Rules
41 High-Cost Universal Service Support, et al., Order, WC Docket No. 05-337, CC Docket No.
96-45, FCC 08-122 (released: May 1,2008), ii 30.
24
governing universal service programs, which are designed to ensure that the public interest
standards of the Communications Act are achieved. As a national leader in prepaid wireless
services, TracFone has done much to advance the availabilty of wireless service for those
portions of the population for whom wireless service is otherwise unavailable or, if available, is
too costly and requires term duration and volume commitments which are beyond the means of
many consumers.
Moreover, designation of TracFone as an ETC wil serve the public interest by fuher
promoting the extensive role TracFone plays in the provision of communications services to
lower income and lower volume users, transient users, as well as other consumers who either
choose not to enter into long-term service commitments or who are unable to meet the credit
requirements necessar to obtain service from other wireline or wireless cariers. TracFone's
"pay-as-you-go" wireless service enables consumers to enjoy the convenience and security of
wireless telecommunication without being subject to extensive credit reviews and long-term
service commitments which historically have limited the availability of wireless service to many
Americans, including many Idaho residents. For all the reasons described herein, designation of
TracFone as an ETC wil serve the public interest.
CONCLUSION
Based on the foregoing, TracFone contends that the requirements for eligibilty for
designation as an ETC have been met. Accordingly, TracFone requests that the Idaho Public
Utilties Commission promptly grant its application for designation as an eligible
telecommunications carier.
25
October 28,2009
Respectfully submitted,
~Debra McGuire Mercer
GREENBERG TRAURIG, LLP
2101 L Street, NW
Suite 1000
Washington, D.C. 20037
Telephone: [phone]
Facsimile: [phone]
brecherm~gtlaw.com
mercerdm~gtlaw.com
Counsel for TracFone Wireless, Inc.
26
Exhibit 1
DECLARTION OF TRACFONE WIRELESS, INC.
I, F.J. Pollak, state as follows:
1. I am President and Chief Executive Offcer of TracFone Wireless, Inc.
("TracFone").My business address is 9700 N.W. nih Avenue, Miami, FL 33178.
2. In my capacity as President and Chief Executive Offcer of TracFone, I
am an authorized representative of TracFone. I have read TracFone's Application for
Designation as an Eligible Telecommunications Carrer in the State of Idaho for the
Limited Purose of Offering Lifeline Service to Qualified Households. I confirm that the
information contained therein is tre and correct to the best of my knowledge.
I certfy under penalty ofpeijur that the foregoing is true and corrct.
Executed on October 2J 2009
d1~
President and Chief Executive Offcer
Exhibit 2
Federàl Communications Commission FCC 65-165.
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
Federa-State Joint Board on Universal Service )
)
Petition of TracFone Wireless, Ino. tor )
Forbeace from 47 U.S.C. § 214(e)(l)(A) and 47 )C.F.R. § 54.2010) L
CC Docket No. 96-45
ORDER
Adopted: September 6, 2005 Released: September 8, 2005.
By the Commission: Commissioner Abernathy issuing a statement
L INODUCTION
i. In this Order, we address a petition filed by TracFone Wireless, Inc. (fracFone)1 pursuant to.
section 10 ofthe Communications Act of 1934;as amended by the Telecmmunications Act of 1996 (the.
. Act)2 requesing that the Commission forbear from the req.airement that a carrier designated as an eligible
telecommunications carer (ETC) for purposes of federal universal serice support provide seivices, at .
leat in Par over its own. facilties~J TracFone requests that its eligibiUty for federal universl service
support be limited to Lifeline only. Subject to the conditions that we describe below, we grt TracFone
forbeace from the facilties requirement for ETC designation for Lifeline support only,. .. .
IL BACKGROUN
2. Procedural History: TracFone is a non-facilities-based commercial mobile radio seivic (CMR)
provider (i.é., a pure wirdessreeller) th~t provides-prepaid wìrel~ss teieCmmunications seivices. Un
June 8, Z004, TracFone fied a Petition for Forbear~ce'from section 214(e) of the Act, which require that
an ETC offer service using its own facilities or a combination of its own facilties and resale of anoth~r
carier's services (Forbearace Petition or Petition).s Contemporaneously with its PetitioR, TracFone fied
i TracFone Wireles, Inc. Petition for Forbeace, CC Docket No. 96-5, fied Jwie 8, 2004 (Forbeace Petition
. or Petition). On Februar 17,2005, puruant to section IO(c) of the Act, the Wireline Competition Bureau (ßuru)
extended unti September 6, 2005, the date on which TracFone's Petition shall be deemed ,grted in the absence of
a Commision decision that the Petition fails to meet the stadar for forbeace wider section 10(a). TracFone
Wireless. Inc. 's Petitionfor Forbeaancefrom 47 U.S.C. § lI4(e)(I)(A) ami 47 C.F.R. § 54.l0I(i), CC Doet No.96-5, Order, 20 FCC Red 3677 (2005). .
2 Telewnuwñtions Act of 1996, Pub. L. No. l04-104~ 1 io Stal56 (1996).
3 47 U~S.C. .§ ZI4(e).
.( We note tht this grt of forbeace do not establish TracFone as an ETC. We will âddres TracFone's
petions for ETC designtions in subsequent ~rder.
.5 On June 24, 2004, the Bureau ised a Public Notice seg comment on TracFone's Petition for Force
Par~ are Invited to Ccmment on TracFone Wireless' Petitinfor Deigntion as an Eligible Telecmmimieaons
Caie in th Sta of New York an Pettion for Forbeaan from Application of Sen 214, CC Docet No. 96-
45, Public Notice, 19 FCC Red 11264 (2004). Comments and relies to tle June 24di PUblic Notiee were reived
1
Federal Communications Commission FCC 05-165
wì the Commission petitions for ETC designation for severl stte.' On Augu 8, 2004, TracFone, in .
its rely comments, and short therea in its applications for ETC designation, amended its Petion and
relate ETC applicaons to limit its eligibilty for federal univeral service support to the Lifeline porton
. of the low-inoome pragra.' TracFone states that it will meet all ETC obligations except for the
reuirement to "own facilities" and commits to providing its Lifeline customer with accss to E9 i i
service, regardless of activation status and availabilty of prepaid minutes, and to requirg its customers to
self-crtify they are receiving only one Lifeline-supported service.' On Septembe 24, 2004, TracFone
amended its Petition a secnd time to include a request for forbce from secon 54.20 1 (i) of the
Commission's rules, which provides that state commissions shall not designate as an ETC a caier that
()ffers service support by federal universal service support mechanisms exclusively through resale of
another carier's service.9
3. Applicable Statutes and Rules: The Act provides that only an ETC shall be eligible for universal
service support.
to To be eligible for ETC designation, a carrier must meet certin statutory requirements
including offering service over its own facilties or a combination of its own facilties and resale of anofuei
on July 26 and Augut 9, 2004, respectively. In response to cein coIRents, TracFone limited its Petition to.
Lifeline sùpport in its Augu 9di reply comments. Because. TracFone modified its Petition in its reply comments,
commenters did not provide comment in the Forbeanmce proceeding on the Lifeline-only limitation. Desit~ this
. 'fact commenters did address the Lifeline-only limitation in the related TracFone ETC procings, Which TracFone
.lkewise modified to reflect the request for limite universal service.support See The Wireline Competition Bw-eau
See Comment on Petiions Concerning Eligible Telecommunications Designtiot/ and the Lifline and Link-up.
Universal Serviæ Support Mechanism, ec Docket No. 96-45 and we Docket No. 03.:"109, Public Notice, 19 FCCRed 20462 (2004).. .
6 TracFone has eight ETC petitions pending before the Commission. See TracFone Wiceles, Inc. Petition fQr
Designation as an Eligible Telecmmunications Caier in the State of New York eCOocket No. 96-45, fied June
8, 2004; TracFone Wireless, Inc. Petition for Designation as an Eligible TelecmmuncationS Caier in the
Commonwealth of Virginia, ee Docket No. 96-45, filed June 21~2004; TracFone Wireles, Inc. Petition (01'
Designation as an Eligible Telecommunications Caer in the State of Florid ce' Docket No. 96-45. filed June 2 l,
2004; TracFon6 Wireless, Inc. Petition for Designation as an Eligible Telecommwiicaton Carer in the State of
Connecticut,Ce Docket No. 96-45, fied November 9, 2004; TracFone Wireles, Inc. Petition for Designtion as an
Eligible Telecommuncations Caer in the Commonwealth of Masachusett, ëc Docket No. 96-45, fied .
November 9, 2004; TracFone Wire1ess,lnc. Petition for Designation as an.EligibleTelecmmunications Caier in
the State of Alabama, CC Docket No. 96-45. fied November 9,2004; TracFone W"ireles, Inc. Pettion for
Designation as an Eligible Telecommuncations Carer in the State of Tenessee, ec Docket No. 96-45, fiied
November 9, 2004; TracFone Wireles, Inc. Petition for Designation as an Eligible Telecommuncations Caer in
the State of Nort Caolina, CC Docket No. 96-45, filed No.vember 9, 2004.
7 TracFone Reply Comments, fied Augus 9, at 2-3 (August Reply Comments). See TracFone Wireless, Inc.
Amendment to Petition for Designtion as an Eligible Telecmmwiications Caier in the State of Florida, CC
Docket No. 96- 45, fied Aug. 16,2004; TracFone Wirless, Inc. Amendment to Pettion for DeSignon as an
Eligible TeIermmuncationsCaer in the State of New York CC Docet No. 96-5, fied Aug. 16,2004;
.TracFone Wireless. Inc. Amendment to Pettion fo. Designation as an Eligible Telecnummications Caer in the
Commonweath ofVirgina, CC Docket No. 96-45, fied Aug. 16.2004.
S TracFone Reply Conuents, fied Octber 4,2004, at 3-4 (Octbe Reply Comments); August Reply Comments atIQ .
947 C.F.R. § 54.20 I (i); TracFone Wirles, Inc. Clarfication ofPetûon fò Forbeace. CC Docet.No. 96-5.
filed September 24, 2004.
1047 U.S.C. § 254(e).
2
Federal Communications Commission FCC 05-165
caer's servce.
i I Only ETCs may recivè high-cstand low-income support 12 The low-income support
mechanism of the univerl seice fud consists of the Lifeline and Lik-Up progrs.1J
4. Collectively, the Lifeline and Link-Up progr are designed to reduce the monthy cost of
telecmmunications seivice and the cost of initial connection, respectively, for qualifying consumers..
Lifeline provides low-income consumers with discounts of up to $10.00 off of the monthly cost of
telephone seivice!4 Link-Up provides low-income consmers witbdiscounts of up to $30.00 off of the
initial costs of installng telephone service. IS Recgnizing the unique nees and charcteristics of trbal
communities, enlianced Lifeline and Link-Up pr:ovide qualifying low-income individuals living on trbal
lands with up to $25.00 in additional discounts off the monthly costs oftelephone service and up to $70.00
more off the initial costs of installng telephone service.16 TracFone seeks eligibilty to receive support
only for the Lifeline portion of the low-income progra.11
II 47 U~S.C. § 214(e)(I)(A).
12 A caer need not be an ETC to parcipate in the schools and libraies or rual health cae program. 47 U.S.C.§
254(h)(l)(A) and (B)(ii). See Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Report and
Order, 12 FCC Red 6776,9015, pam 449 (1997 Universal Serice Order) (concluding that any telecmIunications
caer, not just ETCS, may recive universal serice support for providing supported serice to schools and
. libraes); see also Federal-State Joint Board on Univrsal Serice, CC Docket No. 96-46, Fourenth Order on
Recnsidertion,. 14 FCC Red 20106, 201 14-5, par 19 (1999) (FoW'teenth Order on Reconsideration) (fiding
that although only ETCs may receive universal serire support a non-ETC that provides supported seri~ to
eligible rul health ca providers may offset the value of the discount provided agaúit its unversal service
coDtrbution obligation and, to the extent such discowit exce its contrbution obligation, receivç a refud).
l3 47 C.F.R. §§ 54.401,54.411.
1-4 See 47 C.F.R. § 54.401(a)(2).
IS See 47C-F.R. § 54.411(a)(I).
16 See 47 C.F.R. §§ 54.405(a)(4), 54.411(a)(3). Under the Commission'srnles, there are four tiers of federl
Lifeline support All eligible subscdbers receive Tier 1 support which provides a discowit equal to the ETC's
subscñber line chage. Tier 2 support provides an additional $1.75 per month in federasuppoit available ¡fall
relevant state regulatory authorities approve such a reducton. (All fift state have approved tls reducton.) Tier 3
of f~eral support provides one half of the subscriber's stae Lifeline suport up to a maxui of $ 1.75. Only
subscribers residing in a state that has established its own Lifelinelin-Up progr may receive Tier 3 support
assuming that the ETC ha aU necesar approvals to pass on the full amoun of this total support in discounts to
subscñber. Tier 4 support provides eligible subscribers living on tribal lands up to an.additional $25 per month
towards reducing basic local service rate, but this discount caot brig the subscrber's cost for basic local service
to les than $1. See 47 C.F.R. § 54.403.
17 Augut Reply Comments at 3 (requesting eligibilty for Lifeline only support); October Reply Comments at 4
(specifying it does not see eligibilty for Lin-Up support). TracFone has fied detals of two proposed Lifeline
plan. TracFone Wireless, Inc. Ex Pare Supplement to Pettion for Forbeace and Petitions for Designation as an
Eligible Telecmmunications Caer, CC Docket No. 96-45, at 3-5, filed July 15,2005. The fi plan the "Pay-
As- You-Go" Lifeline PLan provides Lifeline cutomer with acc to the netoi for one yea and 30 minute of
. aire each month. Under TracFone's proposal, the cost of this plan would be completly subsidiz by the
Lifeline support rd. at 3-4. The secnd plan, the ~'Netl 0 Pay-As-You-Go" Lifeline Pla' would reuire the
Lifeline cutomer to purchase bucket of minute to be used in an identified peod of ti that ar discounte frm
TracFone's retl price to reflec the Lifeline subsidy. Id. at 4-5. One varation wider th pla would reuire
Lifeline cutomers to reeem coupns monthly. Id. TracFone stte tht, wider any pla the Admtr would
provide suport to TmcFone as it doe to aU oter reipients of Lifeline suport tht is, TracFonc's Lifeline support
will be cacuatèd on a month bas~ and ditrbuted on a quly basis. Le from Mitchell F. Bréc, Counl
for TracFone, to Marlene II Dort FCC, CC Docket No. 96-45, at 3, filed Augut 22 205.
3
Federal Communiëations Commission FCCOS-165
5. The Commision bas in the pa declined to extend ETC statu to pure reellers. In the 1997
Universal Service Order, the Commission found that the plain languge of the stte reuir that a caer
seekig ETC designaton mus own facìlties, at least in par thus precluding a caier that offers service
solely tlough resae from being designat as eligible.18 The Commission reaoned without '
distinguishing among the various universal seiice support progr, that it was approprate to deny pur
reseUers universal service support because pure reseUers could reive the benefit of universal service
support by purchaing wholesale serice at a price tht includes the universal service support recived by'
the incumbent provider.19 Later in the 1997 Universal Service Order, the Commission found that although
resellers were not eligible to recive universal support directly, they were not precluded frm offerig
Lifeline serice. ReselIers could offer Lifeline service by purchasing services at wholesale rates puruant
to section 25 i (c)( 4) that reflect the customer~specific Lifeline sUpport amount received by the incumbent
loca exchange company (LEC) and then passing these discounts through to qualifYing low-:incom~ .
customers.20 The Commission, in so finding, considered only that the underlying carrier was an incumbent
LEC, subject to pnce-regulated resale obligations. Furter, the Commission declined to forbea from the
fàcilties requirement, finding that the statutory criteria had not been met.21 Making no finding with respect
to the first two prongs, the Commission concluded that forbeance was not in the public interest becuse
allowing pure reseUers to receive universal service support would result in double recover b.y the
resellers.22 In making this finding, however, the Commission ågain did not distùiguish among the various
universal service support programs. Specifically, it did not consider whether providing only Lifeline
support directly to a pure wireless reseller would result in dóuble recovery.
IU. DISCUSSION
6. For the reaons provided below, we conditionaiiy gTant TracFone's Petition and forbea from
section 214(e)'ofthe Act and sections 54.20 1 (d)(l) and54.201(i) of our odes for. the purpose (if
considering its Petitions for ETC Designation for Lifeline support onlyP If ultimately grted ETC status~
TracFone wil be eligible only for Lifeline support As a limited ETC, TracFone would not be eligible to
receive support for the other supported service under the low-income progam nor would it be eligible, as
an ETC, to receive support for services supported by the other universal support mechanisms.24 We win.
address TracFone's petitions for ETC designation in subsequent orders: In sum, this grt is conditional
on TracFone (a) providing its Lifeline customers with 911 and enhanced 91 1 (E91 1) accs regardless of
activation status and availabilty of prepaid minutes; (b) providing its Lifeline customers with E91 1-
compliant handsets and replacing, at no additional charge to the customer, non-compliant handsets of
existing customers who 'obtain Lifeline-supported service; (c) complying with conditions (a) and (b) as of
the date it provides it provides Lifeline service; (d) obtainilg a certification from each Public Safety
IS Iii at 8875, par. 1 78 (adopting Joint Board's analysis and conclusion); see Federal-State Joint Board on
Universal Serice. CC Docket No. 96-5, Recommended Decision, 12 FCC Red 87.. 172-73. par. 160-161 (1996).
i' /997 Universal Service Order, 12 FCC Red at8866, par. 161 and 8875, par. 178.
20 Iii at 8972, par. 370. The Commission noted that it would reaes this appro~ch in the futue if the ,Lifeline
program appeaed to be under-utilzed. /d.
21 ld. at 8875-6, par. 179.
.22id.
21 In addition, and on our own motion, we forbea from secon 54.201(d)1) of the Commision's rules. 47 C.F.R
§ 54.201(d)1). This secon mirors secon 214(e) of the Act and reui th ETCs be facilty-based at lea in
. par We apply the sae forbece analysis we applied to seon 214( e) to th secon of our rules indetg th forbce is wate
24 See n. 16. supra, for discusion regaring parcipation by non-ET in the schools an Iibraes and ru hethca progr.
4
Federal Communications Commission FCC 05-165
Anwenng Point (pSAP) where TracFone provides Lifelie service confiring that TracFone complies
with condition (a); (e) reuirng its customers to self-ceify at tie of serice actation and anualy
thereaf that they are the head of household and reive Lifeline-support service only from TracFone;
and (f) establishing saeguards to prevent its customers from reciving multiple TracFone Lifeline
subsidies at the same addres.IS Finally, as explained below, within thirt days of the releae of this Order,
we require TracFone to file with the Commission a plan outlning the measres it wil tae to implement
these conditions.
7. Section 10 of the Act requires that th Commission forbea from applying any regulation or any
provision of the Act to telecmmunications services or telecmmunications caiers, or classes thereof, in
any or some of its or their geographic marets, if the Commission determines that the three conditions set
fort in secti nn I O( a) are satisfied. Specifically, section i O(a) provides that the Commission shall forbea
from applying such provision or regulation if the Commission determines that:
(i) enforcement of such regulation or provision ìs not necessa to ensure that the charges,
practices, classi'fications, or regulations by, for, or in cOnnection with that telecommunications
caer or .telecommunications service are just and reasonable- and ar not unjustly or unreasonablydiscriminatory;' .
(2) enforcement of such regulation or provision is not necsar for the protection of consumers;and .
. (3) forbearance from applying such pr~vision or regulation is consistent with the public interest.
26
8. In addition, when considering the public interest prong under section 10(à)(3)-, tle,Commission
must consider "whether faroearee ... will promote competitie marèt conditions.ri1 If
the Commission
detenninesthatsuch forbearace wil promote c'mpetition among providers ofteleemmunications
servce..,that deterination may be the basis for a Commission.finding that forbeatce is in the public
interest.28 Forbeice is warnted, however, :only ihll thee prongs of the test ar satisfied. For the
reaons explained below,we find that T..acFone satisfies all three prongs.
9.. This Petition requires that we considerthe sttutory goals of two related but different provisions
of the Act. We first examine the sttutoiy goals ofuniversaJ service in section 254 specifcally in the
2S Conuenter have raised concemsabout the administrtive cost, compiexities, and burdens of grting this
Petition and presibly the associated ET designation pèttions. See Letter from Robin E. Tutte, USTelecm, to
Marlene Dort FCC. CC Docket No. 96-45 (fied Augut 17, 2005) (USTelecm Augt 17 Ex Parte). We
believe that this conditional forbeace wil serve to fuer the statutoiy goal of the providig teleco,imnuiications
access to low-income subscrbers while estalishiiig the necesar safeguards to prote the universal serice fud
and the fuctioning of the low-income support mecanism. To the extent, however, that our predictive judgment
proves incorrect and these conditions prove to be inadequate safeguds, the paries ca fie appropriate pettions
with the Comm:ission and the Commission has the option of recnSiderig this forbce rulin. See Petition for
Forbearance of the Verizon Telephone Companies Pw-sua to 47 U.S.c. § 160(c), WC Docket No. 01-33&,
Memoradwn Opinion and Order, 19 FCC Rcd 21496, 21508-9, par 26 n.85 (2004); see also Petition ofSBC
Communications Inc. for Forbeaance from Strctw-al Separations Requirement of Setion 271 of the
Communications Act of 1934. As Ameded an Request for Relief to Provide International Direcory Assistance
. Serices, CCDocketNo. 97-172, Memorndwn Opinionand Order, 19 FCCRcd' 5211,522-24, par. 190.66
(2004); Cellne Communications. Inc v. FCC, 149 F.3d 429,442 (6th eir. i 998). Additionally, we note tht the .
conditions we impose hère will be incorporated into any grt of the ET designation pettions and an violation of
such conditions may ret in loss or ETC sttu.
2& 41 U.S.C. § 160(a).
2747 U.S.C. § 160(b).
2t ¡d.
5
Federal Communications Commission FCCOS-165
cóntex of ""low-income consumer.,,29 We then consider the statury purpose undeiinning the facilties
requirment in seon 21 4( e) as it relate to quifying for federl low-income univer scice support
After caful exaination' of the regulatory goals of universal serice as applied to low-incme consumers
we detenine that a facilties requirement for ET designation is not nece to ensure that a pure
wieles reselIer~s charges, practice classificaons or regulations ar jus and reaonable when that carner
seeks such status solely for the purpse of providing Lifeline-support services. Indee, for the reaons
provided below, we find that the' facílties requirement impedes grear utilzation of Lifeline-supported
services provided by a pure wireles reseUer.
10. Universal service hasl,een a fundamenta goal offederaltelecommunications regulation since the
passage of the Communications Act of 1934.30 Congress renewed its concern for low-income consumers
in the Telecommunications Act of 1996 when it established the principles that guide the advancement and
preservation of universal service.3i Specifically, the Act directs the Commission to consider whether
"consumers in all regions of the Nation, including low-income consumers and those in rural, insular, and.
high cost area, ... have accss to telecmmunications (service) ... at rate tlatare reaol1ably comparable
to rates charged .,. in urban area.,J2' We therefore exaine the facilties requirement from which
TracFoDe seeks forbeaance in light of the statute's goal of providing tow-income consumers with acce
to telecommunications seivice.
i i. Just and Reaonable: As an initial mater, we note that a provision or regulation is '"necssary" if
there is a stongconntCtion between the. requirement and regulatory goal.J3 Section lO(a)(I) requires that
we consider whether enforcement of the facilties-based requirement of seCtion 21 4( e) for a pure wireless
reseUer that seeks ETC desi.gation for Lifeline support only is necessar to ensure that the charges,
practices, classifications or regulations are just and reaonable and not unustly or unreaonablydiscriminatory. '. .
ll. We find that the. facilties requirement is not necssato ensure that TracFone's charges, .
practices, ånd classifications are just and reasonable and not uIýustly or unonably discrimmatoiy where
it is providing Lifeline seivice only. The Commission has in the pas declined to extend ETC status to pure
resellers becuse it was concerned about double recvery ofutiversal service SUppOrt3~ In making this
. decision, however, the Commission considered the issue in the context of wire line rcsellersan£l without
differentiating among the tyes ofuniversaJ service suport and' the basis ofdistrbunon. Lifeline support
designed to reduce the monthly cost oftelecmmunications serVices for eligible consumers is distrbuted
on a per-customer basis.and is directly reflected in f.e price tht the eligible customer pays.3S Because it is
customer-specifc, a carrier who lose a Lifeline customer to a reseUer would' no tonger receive the Lifeline
support to pass though to that.customer. Thus, a wireless reseUer who serves a Lifelino-eligible customer
and receives Lifeline support directly frm the fund does not recive a double reover. By comparison, .
where the wholesale carer is an incumbent LEe subj~t to price-regulated resale under section 2S1(c)(4),
the rate at which the reselfef öbtains the ~olesale serice is based on a state-mandated percentage
2' 47 U.S.C. § 254(b)(3).
31t 47 U.S.C. § 151 ("t make available, so fa as.possible, to al/ the people ofthé United States ... a rapid, effcien~
Nation-wide, and world-wide wie an couication seice with adeqate facilties at reanable rates
. (emphasis added).
3147 U.S.C. § 254(b); see 1997 UnrversalSerice Order. 12 FCC Red at 8789, par 21 and 8793, par 27.
3247 U.S.C. § 254(b)(3) (emhais added.
J) See CTl 'P. FCC. 330 F.3d 502.512 (2003).
3. 1997 Univeral Serice Order. 12 FCC Red at 8861,8813,8875, par. 151-152, 17~, and 178.
3547 C.F.R. §§ 54.401, 54.504.
6
Federa Communications Commission FCCOS-165
. discount off of the incubent LEe's reil rate for the sece, and any Lieline support reeived by the
incumbent LEe would therefore be refleced in the pñce chaed to the reseUer.36 In this scearO'" a
reseUer that also reived Lifeline support could recver twce: fi beause the beefit of the Lifeline
support is reflecte in the wholesale pñce and secd becuse the reseUer also recives payment directly
frm the fund rOT the, Lifeline custmer. That, however, is not the cae before us. TracFone, as a CM
provider, does not purchase Lifeline-supported service from incwnbent LEe providers. Because
TracFone's CMR wholesle providers are not subject to section 251 (c)( 4) resale obligations, the resold
servce do not reflect a reduction in price due to Lifeline support Therefore, we find that allowing
TracFone to recive Lifeline support dirctly from the fund would not result in double recovery to
TracFone and that the logic ofthe 1997 Universal Service Order does not apply here.
13. We agree with TracFone that, as a reseUer, it is by definition subject to competition and that this
competition ensures that its rates are just and reasonable and not unjustly or unreasonably discriminatory.)7
We note that TracFone's Lifeline offering wil compete with at leat one other Lifeline offering whether-
from the underlying CM provider, if an ETC, of from the incumbent wireline carrier.Jl We also believe
that this competition wil spur innovation amongst cariers in their Lifeline offerings, expanding the choice
of Lifeline products for eligible consumers. We note'tht TracFone has created a wireless prepaid product
that is neither dependent upon the retait service offrings of its underlying carers nor simply a rebranding
of the underlying carier's retail service offering which may provide a valuable alternative to eligibleconsumers.3!' .
. i 4. For the reaons provided above, we find. that the réquirements of the first prong Of section IO( a)
are meL Where, as here, the wireless reseller is forg~ing all univeriàl service support
but Lifeline, which is
customer-specific and. is designed to make telecmmunication service afordable to eligible consumers, tIe
facilties requiremtmt is unnecessar to preserve the integrity of the universal service program or the fund.
By limiting TracFone's eligibility to Lifeline support the facilties reuire¡tent is not necessary to ensur
that TracFone's charges, practices, and classifications are just and reasonable.
15. Consumer Protection: Secion i O(aX2) requires that we conSider whether enforcement of the
facilties-based requirement of section 214( e) for a pure wireless reseller that seeks ETC designation only
for Lifeline support is necssary fOE the prot~tionofconswners. We find thatimposing a facilties
requirement on a pure wireless reseller is not necessar (or the protection of consumers subject to the
conditions described below. Specifically, we conclude that forbeaance frm this provision wil actually
benefit consumers.' Indeed, ifTracFone is ultimately gnted limited ETC status, it would be offering
Lif~line-eligible consumers a choice of providers not available to such consumers today for accesing
telecommuniCations services. The prepaid feature may be an attctive alternative for such consumers who
need the mobilty, security, and convenience of a wireless phone but who are concerned about usage
chares or long-teon contracts. We also note that TracFone has committed to ensuring that all of its
consumers wil be able to place enhance 9 i i (E91 i) calls from their handsets even if the consumer's
service is not active or does not have prepaid minutes available.40
36 Se 47 C.F.R § 25 I (c)(4).
.37 Forbeace Pettion at 5.
31 See 47 C.F.R § 54.405(a) (requirg ETCs to offr Lifeline serice).
39 TracFone state that its cuomer pay in advance for minutes of use, Without term contrct or teintion fee,
other exteous or pas-though fee crit ehec or deposits. TracFone alo stte that its pricing is uniform
across its sece area despite the costs asociated with an parcuiår underying caer. Forbce Petion at 3-
4.
40 Aug Reply Comments at 10.
7
Federal Communirations CommiSiQn FCC 05-165
'16: Given'the importce ofpnblicsafety, we condition this grt of forbeace on TracFone's
compliance with the E911 requirents applicable to wirles resUers, as modifCd below, for all Lifeline
customers. In light of the condition dis below, that TracFone ensure its cutomers recive only one
Lifeline-supported service, we find it essential that TracFone's Lifeline-supportd servce be caable of
providing emergency accs. Given the possibilty that this Lifeline-support serice wil be the
customers' only mea of accssing emergency peronne~ we require that TracFone provide its Lifeline
customers with accss to basic and E9 i I serice immediately upon activation of serce."
i We note that
this condition is consistent with Tracfone's rereentation that its Lifeline customers will be able to make
emergency calls at any time:i To demonste compliance with this condition, TracFone must obtain a
certification from each PSAP wher it provides Lifeline service continning that TracFone provides its
customers with acces to basic and E9 i i service. TracFone must furnish copies of these certifications to
the Commission upon request -43 As an additional condition, TracFone mus provide only E9 I I-compliant
handsets to its Lifeline customers, and must replace any non-compliant handset of an existi~g customer
that obtains Lifeline-supported serv~e.e with an E9 i i -compliant handset at no charge to the customer. The
Commission has an obligation to promot~ ;'.safty of lift and propert and to ceencourageand faciltate the
prompt deployment throughout the Unite States of a sealess, ubiquitous, and reliable end-toend
infrtrcture" for public safety... The provision -of91 1 and E911 servÎce is critical to our nation's abilty .
to respond to a host of crises, ~d this Commission has a longstading and continuing commitment to a
. nationwide communications system that promotes the saety and welfare of all Americans, including
Lifeline customers."s, We believe that these conditions are necessar to ensure that TracFone's Lif6.Jne
cùstomers have meaingful accss to emergency services. We reiterate that, with the possibility that the
Lifeline service wil be the customer's only access to emergency services and given the potential gravity of
har if such Lifeline customers canot obtain such accs, we believe that these conditions wiI furter the
protection of such Lifeline customers. .
17.. We ar not persaded by some.commentersi concern reg~ding the impact on the size of the
universal service fud and the associated contrbution obligation .fwe grt.this Petition."6 Becuse
section i O( a)(2). requires that we consider the welfare of all ucnnsumers," we must consider the effect a
grnt of this Petitin wil have on ëonsumers who will likely shoulder the effects of àny increaed
contribution obligation since carriers are permitted to recover their contribution obligations from.
41 Under section 20.18(m) of our rules, wireless rêséllers have an independent obligation, begiming Deceber 31,
2006~ to provide accs to basic and E91 i serice, to the extent that the tuderlying. facilties-based licensèe has
deployed the fucilties necsar to deliver E911 inormation to' the appropriate PSAP. 47 C.F.R § 20. lS(m).
Section 20. I S(m) fuer provides tht rescUers have an independent obligation to enure that all handsets or other
. device offered to their customer for voice Communcations are location-epable. Id. Under our rules, this
obligation applies only to new hadset sold after Dece\Jer 31, 2006. Jd. As a condition of this grt of
forbeace, however, we require that TracFone, if grted ETC statu, meet the requirements of section 20. 1 8(m)
for all of its Lifeline customers as of the date it provides such Lifeline seivice.
-42 Augut Reply Comments at 10 (gven E9 I 1 caabilties afits serice and handsets TracFone envisions that its
serice "relly will sere as a "lifeline' for those eligible cumer parcipatig in the program").
.4i We recgize that, as a practcal matt, ifTraFone's underlyig facilties-basd liceee has not deployed the
facilties necsa to deliver E9 i I infonntion to the appropriate PSAP, TracFooe wil not be able to offer Lifeline-
supported seivice to cutomer residing in that ar
.f Applications ofNexeJ Communications, Inc an Sprint Corporation For Coen to Tranfer Contol of Lices
an Authoriztins, WT Doet No. 05-3, Memoradum and Orer, FCC 05- i 48, par 144 (re Aug 8, 205).
(S Itf
~ See. e.g.. Comments of IDS Telecmmunications Corp., fie4 Septebe 20,2004, at 5- (IS Comments).
8
Federal Communications Commission FCC 05-165
CQomers.-41 IfTracFóne is able to obtain ET desgntion for Lifeline-nly seice~ we do not expec .
this to significatly burden the univerS serce fud and thus negatiely afect consumer though
increaed pass-thugh chares of the caers'contröution obligaons. The Commision has regniz
the potential grwt of the fund associatd with high-cst support distrbuted to competitive ETCs..ci
TracFone, however, would not be eligible for high-cst support In 2004, low-income support accunte
for only 14 percent of the distrbution of the tota universal servce fud; wheTeas, high-cst support
aculÍted for 64.2 percet.'" Any incre in the siz of the fund w~:)Uld be minimal and is outweighed by
the benefit of increaing eligible parcipation in the Lifeline progr, furtenng the statutory goal of
providing acce to low-income.consumer~ Significantly, grting TracFone's Petition wil not have any
effect on' the number of persons eligible fórLifeline support
18, We fuer.safeguard the fund by imposing additional conditions on this grnt of forbeaance.
Specifically, as a furter condition of this grant of forbearace and in addition to all other required
certifications under tle progrm, we require that TracFone reuire its Lifeline customer to self-certify
under penalty of perjury upon service actiation and then anually therefter that they are the head of
household and only receive Lifeline-supported serVice from TracFone. so The penalties for peijui must be
. clealy stated on the certification form. Additionally, in order to furter strengtenthe head of household
requirement, we require that TracFone trck its Lifeline customer's primai residential address and .
prohibit more than one supported TraFone service at each residential address.51 These Conditions are
consistent with TracFone's representations in the recrd.52 In Iigit of these safeguards, we are not
dissuaded from grting forbeace by concern of double recovery relating to customers receiving
Lifeline support for more than one service.s3 We recgnize. however, that the potentiai for more than orie
47 See 47 C.F~R. § 54.712.
-48 See Federal-State Join Board on UriiverSt Serice, Virginia Cellular, LLC Petition for Designion as an
Eligible Telecommunications .Carrier in the Commonwealth of Virginia, CC Docket No. 96-45, Memoradum
Opinion and Order, 19 FCC Red 1563: 1577, pàr 3.1 (2004); see aIsa Fedeal-State Joint Hoard on Universal
Service. ffghlånd Cellular. fnc. Petitionfor Designtion as an Eligible Telecommunications Carier in the
Commonwealth pfVírginia. CC Docket No. 96:5, Memoràdmn Opinion and Order, 19 FCC Red 6422,6433-4,par 25 (2004). .
49 Wireline Competition Bureau. Federl cOmmunications Coinission, Tr~ in T~¡ephol1e Seri~. Table 19. l
and Cha 19.1 (June 2005). As of March 2004. the average monthy federl support per non-tribal Lifeline
customer was $8.55. fd. at Table 19.7. See 47 C.F.R. § 54.403. Tribl cuomers are eligible for up to an
additional $25 pey'ionth ÍI Lif(!line SUP¡Krt 47 C.F.R. § 54.403(a)(4), .
so October Reply Comments at 3-4 (commitment to require Lifeirre cutomers to self-cfy that they do not recive
support from any other carrer). To monitor complianCe, we reqire that TracFone maintain the self-certfications
and provide such documentation to the Commission upon requeL
.51 See ReplyComments ofTracFone Wireless, Inc. to Petition for ETC Designation in Virginia, filed September 7.
2004, at 7-8 (fu.lly capable of fulfilling all record keeping requirements and has the abilty to trck each conser's
primar residence). See also Le from Mitchell F: Brecer, Counl for TracFone, to Marlene H. Dortch, FCC,
CC Doket No. 96-45, fied Juiy 13,2005 (capable of fulfillig cefication and verfication requiements)
. (fracFone July 13 Ex Parte).
51 See n.6 and n.51 above. We point out th these conditions are in addition to, and do not supplant, the
cefication and verfication eligibilty already reed by our rules for feder default sttes and any simar stte
roles for the non-federl default states. See, e.g., 47 C.F.R § 54.410 (reqirg initial certfication and amualverfication of eligibilty). . .
si Se IDS Comments at 5-6; Reply Comments of the United State Telecm Asociation, fied October 4, 200, at 6
and 0.18; let from Kathere O'Har veÎzon, to Malene H. Dortch FCC, CC Docet No. 96-5, at 1, fied
Augu 9, 2005 (Vern Ex Par); USTelecm Augt 17 Ex Parte'at 4.
9
Federal Communications Commission FCC 05-165
Lifeline-supported service pen~ligible consumer is an indus-wide problem.54 We are confent that
these conditions of this grt of forbeace will eliminat this conce with repe to TraFone's
customer. Additíon~lly. we encourae comment on ths issue in the Comprehensive Universal Services
Program Management proceing to address the potential for abuse thoughout the indus.55
19. USTelecm raise(l concerns about the fact that TracFone distbutes its service through retail
outlets.S6 USTeleciI argues that TracFone will not have the requisite cOntrol over the retailer's employees
to ensure compliance with Lifeline rules and ceifications. We recgniz that this may be a problem and
th~s reuire that TracFone disibute its Ufeline service directly to its Lifeline customer. Specifically,
customers may purhase handsets at TracFone's retail outlets, however, we require that TracFone deal
directly with the customer to certifyandverify the customer's Lifeline eligibilty. Of the two methods for
certifying and verifying customer eligibilty offered by TracFone, we reject the point of sale procedures
that would allow TracFoñe Lifeline customers to submit qualifying infonnation to the retail vendor.57
TracFone must have direct contact with the customer, whether by telephone, fax Internet, in-person
consultation or otherise, when establishing initial and continued eligibilty.
20. Certin commenters argue that the prepaid, resold nature. ofTracFone's proposëd service offering
wil facil(Rte fraud, waSte, and abuse in the Lifeline progr.SI We find that this concern is more properly
addressed in any order resolving TracFone's petltions for designation as an ETC. In the ETC designation
proceedings, ifTracFone's petitions are grte, we wil address how Lifeline support wil be calculated
and distrbuted if the prepaid natUre ofTracFone's ser-iceoffering requires such clarfication.
2 I. In light of the conditions we have outlined here, we believe that appropriate safeguads are in
place to deter waste, frud, and abuse. We stre. to balance our objective of increasing parcipation in the
low-income. progra with our objective of preventing and deterg wase, frud, and abuse. We find that
we have strck tÎe appropriate balance here. We are also'mindful of the. fact that otiér prepaid pure
wieless caers may similarly sèek eligibilty for pfeline-only support. Given the safeguards we put in
place aimed at ensuring that only eligible consumers receive such support and that they recive such .
. support only once, we do not believe that similar requests wil have a detrimental impact on the fud. We
note that to the extent. any similarly situated prepaid wireless reseller seeks forbeace from these
requirements for the purpose of providing only Lifeline support it will be expected to comply with .all the
conditions we impose npon TracFone herein.
22. Accrdingly, we find that, subject to the 91 i and E91 i conditions and the setf-certfication and
address limitation conditions set out above~ the ETC facilties-based reuirement is not necssary for
consumer protection. We thus conclude that tle secnd prong of section IO(a) is satisfied.
23. Public Interest: Section lO(a)(3) requires that we consider whether enforcement ~fthe facilties-
based requirement of section 214(e) for a pure wireless reseller that seeks ETC designation for Lifeline54 .See Venzon Ex Parte at i; USTelecm Augut i 7 Ex Pare at 2, 4.
55 See Comprehensive Review of Universal Service Fwu Management. Administration, an Overight. Fedal
State Joint Board on Universal Serice. Schools an Libraries Universal Serice Support Mechanism, Rural Health
. Care Suppert Mechaism, Lifeline and Link-Up. Changes to the Bóard of Directors fòr the National &chage
Carier Association, Inc., WC Docket Nos. 05-195, 02-60, 03-109 and CCDocket Nos. 96-45,97-21, FCC05-l24,
par 22 (reL Jwie 14,2005) (Comprehive Universal Seice Program Managemnt).
56 See USTelecmAugt 17 Ex Parte at4.
51 TracFone July 13 Ex Pare at 2-3.
51 Lett frm Jeff S. Laing, USTelec to Marlene II Dort FCC, CC Docket No. 96-45. at 3-5, fied
Augut 26,2005; Rely Comments of V enn. fied Ocer 4~ 2004, at 3.
10
Federal Communìcations Commision FCCOS-165
support only is ia the public interest: In this ince, based on the recrd before us, we find that the
statutory goal of providing telecmmunications aCCs to low-income consers outweighs the
requirement that TracPone own facilties where TracPone, should it be designated an ETC, wil be eligible
only for Lifeline support Thus, we find that requiring TracPone, as a wireles resUer, to own facilties
does not necsañly furter the statutory goals of the low-income progr, which is to provide support to
qualifying low-income consumers throughout the nation, regardiess of where they live.
24. The Lifeline progr is designed to reduce the monthly cost of telecommunications service for
qualifying low-income consumers.59 Presently only about one-third of households eligible for low-income
assistance actually subscribe to the progr."'. We recntly expanded eligibilty crteria and outreach
guidelines for federal' default sttes in an effort to increase paricipation.'. On July 26, 2005, we launched
ajoint initiative with the National Association ofRegilatory Utilty Commissioners to raise awareness of
our Lifeline and Link-Up programs among low-income consumers.'2 We believe even more can be done to
furter expand participation to those subscribers that qualify and thus furter the statutory goal of section
254(b)~Therefore, consistent with the Commission's asserton in the 1997 Universal Service Order
concerning under-ut¡.zation of the progra, we conclude it is appropriate to consider the relief requeste
with the goal of expanding eligible parcipation in the program:'3 With only about one-third of Lifeline-
eligible households actually subscribing, we believe that grting TraeFone's Petition serves the public
interest in that it should expand paricipation of qualifying consUmers. Accordingly, we conclude that
forbeaing from the facilties requirement for Lifeline suppoit only, subject to the conditions set fQrt. .
above satisfies the requirements of section lO(a)(3).
25. Within thirt days of this releae of this Order, we require that TracFone fie with the
Commission a plan outlining the meaures it wiltae to implement the conditions outlned in this Order.
This plan wiU placed on public notice and will be consÎdere by the Commission in TracFoneis ETC
design;,tion proceeings. For the foregoing reons aßdsubject to the conditions above, we finathat the
third prong of section I O( a) is satisÏied.
26. Finally, we reject USTetecm's arment thåt TracFone has not requested forbeance from the .
facilties requirement in section 254( e) imd that without súch forbeance TracFone cannot tùlfiH the
obligations of an ETC. .specificallY7 section 254(e) requires that "a carier that receives such support shall
use that support only for the provision, maintenance, and. upgrading of facilties and services fOJ'which the
support is intended.;J6 USTelecorn emphasizes that the words "facilties" and "services" are joíned by the
conjunctive artiCle "and" and therefore an ETC must use any universal support received for facilties as
well as services.65 We disagree with USTeJecm's interpretation. First we read this provision together
with the sentence that precees it. The preceding sentence states that only an ETC "shall be eligible to
recive specifc Federal universal service suppor1"" The next sentence, which USTelecorn quotes, then
5947 C.F.R. § 54.401.
'0 Lifline and Link-Up. WC Docket No. 03- I 09, Report and Order and Furer Notice of Proposed Rulemaking, 19
FCC Red 8302, 8305, par. i and Appendix K at Table I.B.
61 Ill at 8305, par i.
.62 FCC an NARUC Lanch "Liflin Across Ameica" to Raise Awarens of Lifline an Lin-Up Programs,
News Releae, July 26, 2005.
61 1997 Universal Serice Order. 12 FCC Red at 8972, par. 370.
64 47 U.s.C. § 254(e).
Ø'USTelecm Aug 17 Ex Parle atS n.L
.66 47 U.S.C. § 254(e) (empha added.
1I
Federal Communications Commission FCC 05-165
reuires that "such service", which we find refers to the specifc univeral support from the previous
sentence, be us only for purposes "for which the support is intended." Reading these sentence together
in their entity, we find that Congr intended that a caer mus use the uners support reived to_
meet the goals of the specific support mechanism under which it Wa distbuted. For exaple, a caer
who receiveS speific Lifeline support must use that support to reuce the price of acc to
telecommunications services for the eligible customer. Second, we note that not all the nominalize verbs
in the sentence quoted by USTelecom, "provision," "maintenance," mid "upgrding," ca be read to apply
to both facilties and servces. What for example would it mea to "maintan" a "service" apart from the
"facilties"? We also note that the nominalize vers themselves are joined by the conjunctive article
ccañd". Therefore, extending USTelecom's logic, any universal support received by
a caer must always
be used for the provision, maintenance, and upgrading of both facilties. and services. The ters
maintenance and upgrading as generally associated with a carrer's network and not with service itself.
Thus, USTelecom's reading of section 254(e) would require us to interpret the tenn "service" as surplusage
- a result that must be avoided when the statute admits to other interpretations." We find the more
appropriate reading is to consider these tenus in the disjunctive. Thus, we conclude that an ETC receiving
Lifeline support uses this specific universal service Support for the purposes for which it wa intended
when it reduce the price of the Lifeline service by the amount of the support.
IV. ORDERIG CLAUSE
27. Accordingly, IT is ORDERED TI T, pursuant to sections 4(i), 10,214, iid 254 òfthe
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i), 160,214, and 254, the .Petitionfor
Forbearace filed by TracFone Wirless, Inc. on June 8, 2004, and amended on August 9, 2004 aid
September 24, 2004, is GRAD subject to the conditions set fort above and, on our. own motion, we
forbear from enforcing 47 C-F.R. § 54.201(l)(d).
FEDERA COMMICA nONS COMMSSION
Marlene H. Dortch
Secretaiy
61 '. .See e.g.. TRW Inc. v. Andews, 534 U.S. 19.31 (2001); Dun v. Wallæ,533 U.S. 167, 174 (2001).
12
Exhibit 3
Federal Communications COmmison FCC 08-100
Beforetle
Federal Communications Commision
Washington, D.C. 20554
In the Matter of
Federl-State Joint Board on Universal Service
TracFone Wireless, Inc.
Petition for Designation as an Eligible
Telecmmunications Carrier in the State of New
. York
Petition for Designation as an Eligible
Telecommunications Carier in the State of Florida
Petition for Desigpation as an Eligible
Telecmmunications Caier in the
.Commonwealth òf Virginia
Petition for Designation as an Eligible
Telecommunications Carrier in the State of
Connecticut
Petition for Designation as an Eligible
. TeleomniunicatioÌls Carier in the
Commonwealth ofMassacnusett
Petition for Designation as an Eligible
Telecommunications Carrer in the State of
Alabama.
Petition for Designation as anEligible
Telecmmunicatións Caier in the State of Nort
Carolina
Petition for Designation as an Eligible
Telecomm':nications Carier. in the State of
Tennessee
Petition for Designation as an Eligible
TelecommUriicatións Carier in the State of
Delawar for the Limited Purpose of Offering
Lifeline Service to Qualified Househòlds-
Petition for Designation as an Elìgible
Telecmmunications Caer in the State of New
Hampshire for the Limite Purse of Offerig
Lifeline Servce to Qualified Housholds
Petiti~n for Deignation as an Eligible
Telecmiunications Caer in the
Commonwealth ofPersylvania for the Limite
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)
CC Docket No. 96-45
Federal Communications Commision FCC OS-I 00.
Purpse of Offering Lifeline Service to Qualified )Households )
).
Petition for Designation as an Eligiòle )
Telecmmunications Caer in the Distrct of )
Columbia for the Limited Purpose of Offering )
Lifeline Service to Qualified Households )
ORDER
Adopted: Apnl 9,2008 Released: Apnl 11, 2008
By the Commission: Commissioners Copps, Adelstein and Tate issuing separte statements.
L ~RODUCTION
I. In this Order, we coniJjtionally grt the petitions ofTracFone Wireless, Inc. (fracFone)
to be designated as an eligible telecmmunications carer (ETC), eligible only to reCeive universal
service Lifeline support in its licensed service areas in New York, Virginia, èonnecticut, Massachusett, .
Alabama, Nort Carolina, Tennesse, Delaware, New Hampshire, Peiisylvan.ia, and the District of
Columbia, pursuant to section 2 i 4( e)(6) of the Communications Act of 1934, as amended (the Act).' Due
J TracFone Wireless, Inc. Petition for Designation as an EligibIe TeJeconuunications Carier in the State of
NewYork, CC Docket No. 96-45 (fied June 8, 2004) (New York Petition); TracFone WireleSs, inc, Petition for
Desi&1ation as an Eligible Teleoommunications Caer in the Commonwealth. of Virginia, CC Docket No. 96-45
(fied July 21, 2004) (Virginia Petition); TmcFone Wireless, Inc. Petition for Designation as ar Eligible
Telecomnunications Caer in the State of Conneeticut, CC Docket No. 96-5 (fied Nov. 9,20(4) (Conneccut
Petition)¡ Trac~one Wireless, Inc. ~ètition fUT DeSignaton as an Eligible TeJecnimunications Caier in the
Comnonwealth of Massachusett, CC Docket No. 96-45 (filed Nov. 9, 2004) (Massachusett Petition); TracFone
WiFeless, Inc. Petition for Desigation asan Eligible Telecniunications Caier in the State of Alabama, CC
Docket No. 96-45 (filed N9V. 9, 2004) (Alabama Petition); TracFone Wireless, Inc. Petition for Designation as an
Eligible Telecommunications Carer in the State of Nort caolina, CC Docket No. 96-45 (fied Nov. 9, 2004)
(Nort Caolina Petitin); TtacFone Wireless, Inc, Petition for Designation as an Eligible Telecmmunications
Caier ìn the State oflènnessee, CC Docket No. 96-45 (filed Nov. 9, 2004) (Tenessee ~etitioÐ); TracFone
Wireless, Inc. Petition for Designation as an Eligible Telecommunications Carer in the State of Delawe for th~Limited.PurQse ofOffeñng Lifeline Serce to Qualified Households, CC Docket No. 96-5 (fied Nov. 28,2007)
(Delawae petition); TracFone Wireless, Inc, Petition for Designation as an Eligible Telecommunications Caer in
the State of New Hampshir for the Limited Purse of Offerig Lifelme Service to Qualified Households, CC
Docket No. 96-45 (fied Nuv. 28, 2007) (New. Hampshir Petition); TracFone Wireless, Inc. Petition for Designation
as an Eligible Telecommunications Carier in the Commonwealth of Pennsylvania for the LimitedPurpose of
Off~rig Lifeline Service to Qualified Households, CC Docket No. 96-45 (fied Dec. 11,2007) (pennsylvana
Petition); TracFone Wirless, Inc. Petition for Designation as an Eligible Telecommunications Carier in the District
of Columbia for the Limited Purpose of Offerig Lifeline Service to Qualified Households, CC Docket No. 96-45
(fied JaiL 18,2008) (District of Columbia Petition). TracFone filed an errtum to its New York Petition correctig,
from four to five, tfe number of underlying caers it uses to serve subsciher in that state. Ertu to TracFone
Wireless, Inc. Petition for Designation as an Eligible Telecmm~ications Carer in the State of New York CC
Docket No. 96-5 (fied June 14,2004). TracFone later amended its reqes for ETC designtion in New York andVirioia to limit its eligibilty for feder universal serice support to.the Lieline progr only. Amendment to
TracFone Wireles, me. Pettion for Desigtion as an Eligible Teleemmunieations Carer in the State of NewYor CC Docet No. 96-5,2 (filed Aug. 16,2004); Amendnent to TracFone Wirles, Inc. Petition for'
Designation as an Eligible Telecmmunications Caer in the Commonweath ofVirinia, CC Docket No. 96-5, 2
(fied Aug 16, 2004). TiacFone's petition for ET designation in the remaiing staes, other than Flda, as
discued below, wer limited to eligiòi1ty for Lifeline suport as originly filed TracFone doe not see
eligibilty for higl-c support
2
Federa Communications Commision FCC 08-100'
to the Florida Public Service Comision's aseron of jurisdiction ov.ér wireles ETC designations, we
dismiss without prejudice TracFone's peition for designation' as an eligiòle telecmmwiications caer ùi
Florida 2 On September 8,2005, the Commision conditionally grted TracFone's petion for
forbeace trm the facilties requirement of section 214(e)(I).J As discusse below, we now conclude .
that TracFone has satisfied the remaining eligibilty requirements of section 214(e)(l) and theCommission's rules to be designated as an ETC eligible only for Lifeline support (limited ETC).4 We
also approve TracFone's plan for complying with the conditions imposed in the Forbearance Order.s
II BACKGROUN
A. The Act
2. Section 254(e) of the Act provides that "only an eligible telecmmunications caer
designated under section 2 I 4( e) shall be eligible to recive specific Federal universal service supporl',6
Pursuant to section 214(e)(l), a common carer designated as an ETC must offer and advertise th~
services supported by the federal universal service mechanisms throughout the designted service areå.7
3. Section 214( e)(2) of the Act gives state commissions the primary respo":sibilty for
performing ETC designations.! Section 214(e)(6) directs the Commission, upon request to designate as
an EtC "a common carier providing telephone exchange service and exchange access that is not subject
to the Jurisdiction of a State commission...9 Under section 214( e)( 6), the Commission may, with respect
to an area served by a rual telephone company. and. shaH, in aIt othr cases, designate more than one
common carier as an ETC-for a designated service area, consistent with the publìc intrest, convenience,
and necssity, so tong as the requesting. carrer meets the requirements of section 214(e)(I).lo Before .
2 TracFone Wireless, Inc. Pettion for I!esigation as an Eligible Teleconuunications Caier in the Stae ofFlorida.'
CC Docket No. 96-45 (fied July 21, 2004) (Florida Petition)" TracFone later amended its request for ETC
designation in Florida to limit its eligibilty for federai universal service support to the Lifeline progrm only.
~mendment to TracFone Wireless, Inc. Petition for Designation as an Eligible Telecmmunications Carrer in the
State of Florida, CC Docket No~ 96-45, 2 (fied Aug. 16, 2004); see para 10 irya (discussing jurisdiction. of the
Florida Public Service Commission).
J Petition ofTracFone Wireless, Inc-forForbearancefrom 47 u.s.c. § :il4(e)(J)(A) and 47 C.F.R. § 54.20J(i), CC
Docket No. 96-45, Order, 20 FCC Rcd 15095 (2005)'(Forbëarance Order). Under section 214(e)(I)(A) offue Act.an ETC must offer servce using its. own facilties or a combination of its own facilties and resale. of another
carrer's service. 47 U.S.C. § 214(e)(I)(A).
4 Lifeline is the univer serice low-income progr that provides discounts to qualified low-income consumers
on their monthly telephone bills. See 47 C.F.R. §§ 54.401-54.409.
s Petition ofTracFone Wireless,lnc. for Forbearce from 47 U.S.c. § 2l4(e)(l)(A) and 47 C.F.R. § 54.20
i (i), CCDocket No. 96-45, Compliance Plan (fied Oct. 1 i, 2005) (TracFone Compliance Plan); Petition ofTracFone
Wireless, lnc. for Forbearance from 47 U.S.C. § 214(e)(l)(A) and 47 C.F.R. § 54.10 i (i), CC Docket No. 96-45,Ertum to Compliance Plan (fied Oct. 17. 1005) (Etu to Compliance Plan) (correcg its charcterization of
Florida to identitY it asa state with state-impsed ceÌtfication and verfication requirements for Lifeline eligibilty).
647 U.S.C. § 254(e)~
.i 47 U.S.C. § 114(e)(l); see also 47 C.F.R. § 54.101(d).
., 47 U.S.C. § 214(e)(2); see Promoti~g Deploymen anSubscribership in Unsered Areas. Inc1uding Trbal and
Insar Areas. CC Docet No. 96-5, Twelft.Reprt and Orer, Memoradum Opinion and Order. and Furer
Notice ofPro(lsed Rulemakg. 15 FCC Red 12208, 1225, par 93 (2000) (Twelfth Report an Orde).
947 U.S.C. § 214(e)(6).
10ld.
3
Federa Communications Commiion FCC 08-100
designating an additional ET for an area served by a ru telephone company..the Commision must
deterine that the designation is in the public intere II
B. Commission Requirements for ETC Designation
4. An ETC petition must contain the following: (1) a certification and brief sttement of
supporting facts demonstting thatthe petitioner is not subject to the jurisdiction of a state commission;
(2) a certfication that the petitioner offers or intends to offer all services designated for support by the
Commission pursuant to section 254( c) of the Act; (3) a certfication that the petitioner off~rs or intends
to offer the supported services "either using its own facilties or a combination of its own facilities and
resale of another carrier's services;" (4) a description of how the petitioner "advertise(s) the availabilty of
the (supported) services and the charges therefore using media of general distrbution;" and (5) if the
petitioner meets the definition of a "rural telephone company" under section 3(37) of the Act. the identity
of its stu~y area~ or, if the petit~on~t is not a "rural teleph?ne ~mpany," a detail~ d~sc~ltion of the
geographic service area for which it requests an ETC designation from the Commission.
5. In the ETC Designation Order, the Commission adopted additional requirements for ETC
designation proceings in which the Commission acts pursuant to section 214(e)(6) of the Act.O
Specifically, consistent with the recommeiidationofthe Federa-State Joint Board on Universal Serice,
the Commission found that aD ETC applicat must demonstrte: (I) a commitment and. abilty to provide
services, including providing service to all customørs within its proposed service area; (2) how it wil
remain functional in emergency situations; (3) that it wil satisfY consumer protection and service quality
stndards; (4) that it offers local usage cOmparble to that offere by the incumbent LEe; and (5) an
understading that it may be required to provide equal accs if all other ETCs in the designated service
area relinquish thir designations pursuant to section 214(e)(4) of the Act.l-f Thse additional . .
requireents.are mandatory for all ETCs designted by the Commission. IS ETCs alredy designated by'
the Commission or ETC applicants that submitted applications prior to- the effective date of the ETC
Designation Order must make such showings in. their annual certification fiiings.16.
Il Id.
12 See Procedures for FCC Designtion of Eligible Telecommunications Carriers Pursuant to Section 2I4(e)(6) of
the Communicotions Act, CC Docket No. 96-5, Public Notice, 12 Pce Red 22947, 22948 (1997) (Section 214(e)(6)
Public Notice).
lJ See Federal-State Joint Board on Uniersal Service, CC Docket No. 96-45, Report and Order, 20 FCC Red 6371
(2005) (ET Designion Order); see also V"irginiaCellular. LLC Petitionjor Designation as an Eligible .
Telecommunications Carrier for the Commonwealth of Virginia. CC Docket No. 9645, Memoradum Opinion 'and'
Order, 19 FCC Red 1563, 1564, 1565, 1575-76, 158485, par. 1,4,27,28,46 (2004)(Virginia Cellular Order);
Highland Cellular Inc. Petition/or Designtion as an Eligible Telecommunications Caier for the Commonwealth
olVirginia. CC Docket No. 96-5, Memoradum Opinion and Order, 19 FCC Red 6422, 6438, par. 1.33 (2004)
(Highland CelIuar Order). .
14 See ET Designation Order. 20 FCC Red at 6380. par 20 (citig Federal-State Joint Board on Universal
Serice, CC Docket No. 9645. Recmmended Decision. 19 FCC Red 4259, par. 5 (Fed-State It. Bd. 2004)).
IS 47 C.F.R. § 54.202(a). Becuse Ti;cFone is a pure resellereligible for Lifeline suppo only. we do not require
TracFone to demoiite tht it satfies the network build-ut and improvement requirements or to provide a
cefication that it ackowledges that the Commision may reqir it to provide equal acc to long dice
caer in the event that no other eligble telecmmunicaons caer is providing equal accs within the secear
16 47C.F.R. §§ 54.202(b); 54.209.
4
Federal Communications Commision FCCOS-lOO
: . 6. In addition, prior to designating an ETC purant to seon il4(e)(6lofthe Act, tle
Commision deterines whetler such desgnation is in the public interest 11 . In the ET Designation
Order, tle Commission adopted one set of crteria for evaluating the public inteest for ET designations
for both rural and non-rul area. ii Speificaly, in detennining the public interst, the benefits of
increed consumer choice and the unique advantaes and disadvantaes of the applicat" s service
offering are consider.19 As the Commission noted in the ET Designation Order, however, the same
. factors may be analyze differently or may warrt a different outcome depending on the specifcs of the
. proposed service area and whether it is rural or non-niL20
C. TracFone'sPetitions
7. TracFone is a non-facilties-based commercial mobile radio service (eMRS) provider
that offers prepai~ wireless telecommunications services?1 On June 8, 2004, TracFone fied a petition
seeking forbearance from section 214(e)(l) of the Act, which requires that an ETC be facilties-based, at
leas in part.n Beginning on that date, TracFone filed wi the Commission petitions seeking designation
as an ETC only for the purose of being eligible to reive universal servce Lifeline support in its
licensed service area in New 'york, Virginia, FI'orida, Connecticut, Massachusett, Alabama, Nort
Carolina, Tenne~see, Delaware, New Hampshire,.Pennsylvania, aJd the Distict ofColumbia.23
8. In the Forbearance Order, the Commission conditiorially grted TracFone's request for
forbearance from the facilties-based requirements of section 2l4(e)(1)(A) of the Act and section
54.20 t (i) of its rules for the purpose of considenng TracFone's petitions for limited ETC designation.14 .
The Forbearance Order requiredthat Tracrone fie a compliance plan with the Commission explaining
how TracFone wil implemen.t the conditions imposed by the Forbearance Ordei.25 TracFone filed itS
compliance plan on Oct~ber I i, 2005.16
1747 U.S;C. § 214(e)(6);47 C.F.R. § 54.202(c). See also ET Ð~ignation Order, 20 FCC Rcd at 6388-96, para.
40-57; Virginia Cellular Order, 19 FCC Red at 1575, par 27; /fignIand Cellular Order, 19 FCC Red at 643 1-32,
par 21 . The Commission place the burden on the ETC applicat to demonstrte that the public interest is served.
ETC Designation Order, 20 FCC Rcd at 6390, par 44.
IS ET Designation O~der. 20 FCC Rcd at 6389-90, par. 42-43.
19 47 C.F.R. § 54.202(c).
io ET Designation Order, 20 FCC Rcd at 6390, par.43. In analyzing the public interest factors in this intace,
therëis no rul/non-rural distction beuse Lifeline support unlike higl-cost support is not determined based on
whether the service area is rul or non-rul. See 47 C.F.R. § 54.403. .
21 See e.g... Masachustt Petition at 2,. 3.
D 47 U.S.C. § 214(e)(I).
.2J See supra note I and 2.
24 Forbearance Order, 20 FCC Red at 15098-99, par 6. Additionally, on its own motion, the Commission forbre
from secon 54.20 I (d)I) ofits rules, which mirrs secion 214(e) oftle Act reuirng that ET be facilties-based at leat in par ld. at 15098,0.2.
.. 25 ld. at 15105, par 25.
26 See generally TracFone Compliance Plan; Er to Compliance Plan.
5
Federal Communications CommiSion FCC 08-100
ID. DISCUSSION
A. . Commission Authonty to Penorm the ETC Designation
9. TracFone has demonstted that. except for the Florida Public Servcè Commission. the
relevant stte commissions lack authority to pedonn the requesed limite ETC designations. and the
Commission has authority to consider TracFone's petitions under section 214( e)( 6) of the Act Each
petition includes an affnnative staement from the relevant state commission providing that ETC
designation should be sought from the Commission.27 Accordingly. we find the relevant state
commissions lack jurisdiction to designate TracFone as an ETC and that this Commission therefore has
authority to perfonn the requested limited ETC designations under section 214(e)(6).28
i O. In Aprìl of this year. the Florida Public Service Commission found that due to a change
in Florida state law. it '"now ha(s) jurisdiction to consider CMRS applications. for ETC designation.,,29. In
light of this development, and beuse section 214(e)(2) of the Act gives state commissions the primarresponsibilty for performing ETC designations. wedismiss without prejudice the petition fied by
TracFone seeking designation as an ETC in Florida. TracFone mayre-fie its petition with the Florida
Public Service COmission. Should the Florida Public Service Commision consider grating a petition
by TracFone for designation as a limited ETC in Florida, we would encourage it to require TmcFone to
adhere to th compliance plan we approve herein. .
B. Analysis ofthe Eligibilty Requirements
. Ii. Offering the Services Designated for Support. . TmcFone has demonstated. though the
required certifications and related filings. that it now offers or wil offer upon designation as a limited
ETC the services. supported by the Lifeline progr.30
ii. Offenngthe Supported Services Using a. Caer's Ow Facilties. The Commission
previously gratedTracFone forbeace frm the facilties requirement for purposes of this limited ETC
designation, permitting TracForie to offer the supported services via resale only.).
13. Advertising the. Supported Services. TracFone has demonstrated that it satisfies the
requirement of section 2 I 4( e)( 1 )(B) to advertise the availabilty of the supportd services and the relatedchargès "using media of general distibution.',Ji TmeFone has also stated that, in complíânce with the
27 E.g., New YorkP.etition at4 and Exhibit 2.
ia 47U.S.C. § 214(e)(6).
29 Petition of Alltel Communications. Inc. for Designation Os Eligible Telecommunications Carrier (ETC) in Certain
Rural TeIephane Company Study Areas Located Partially in Alltel's Licened Area and for Redefinition of those
Study Areas. PSC-07-0288-PAA-TP, Notice of Proposed Agency Action Order Finding Authonty to Consider
Applications By CMR Providers For ETC Designation, 2007 WL 1029436 (pIa. P.S.c. Apr. J, 2007). The Apnl
order wa a proposed agency action, which was made finaJ by a consummating order on June 7, 2007. See Peiition
of Alltel Communications. Inc. for Designation as EJigibleTelecommunications Carrier (ET) in Certain RuralTelephone Company Study Areas wcated Partially in Alltel's Licened Area and for Redefmition of those Study
Areas. PSC-7-048IA-eO-TP. Amendatory Order. 2007 WL 1774614 (pIa. P.S.C. Jwie 7. 2007).
3047 C.F:R. §§ 54.4IO(a). 54.IOI(a)(I)-(a)(9); see. e.g.. New York Petition at 5-8-. In paricular, we disagree with
Coenters who ared drt TracFone caôt offec toU limitation servce. See. e.g., TracFone Wireless. Inc.
Petition for Desißlation as an Eligible Telecmmunications Caer in the State of New York CC Docket No. 96.
45. Comments of IDS Telecmmwiicaans Corp.. at 9-1 I (filed July 26. 2004). We fid that the prepaid natu of
TracFone's serice offerg wor as an effective toll contrl. See infra par 15.II .Forbeaance Order, 20 FCC Red at 15093. par. 6.
32 47 U.s.C.§ 214(eXl)();see, e.g.. New
York Petition at 8.
6
Federal Communications Commision FCCOa-iOO
Commission's Lifeline rules, itwill advertise the availabilty.ofLifeline servce in a manner reonábly
designed to reach tho~e likely to quaitY for those service.JJ
14. Additional Eligibilty Requirements. TracFone either satisfies the applicable eligibility
requirments set fort in the ETC Designation Order, described above,34 or must make such showigs in
its first annual report under section 54.209 of the Commission's rnles.JS
C. Public Interest Analysis
is. We find that TracFone's universal service Lifeline 9ffering wiI provide a variety of
benefits.to Lifeline-eligible consumers including increaed consumer choice,i6 high-quality service
offerings,J7 and mobiHty.J8 . In addition, the prepaid feature, which essentially functions as a toll control
feature, may be an attctive altej:ative to Lifeline-eligible consumers who are concerned about usage
charges or long-teno contrcts. The Pennsylvania Offce of Consumer Advocate and the National
Emergency Numbers Association Keystone Chapter assert, ho",ever, that TracFone is not complying with
Pennsyrvania's Public Safety Emergency Telephone Act (the Pennsylvania Act), which requires that
wireless providerS collect a wireless E91 i surcharge aid remit the money to Pennsylvania's Wireless E-
911 Emergency Fund.J9 The Nationtil Emergency Numbers Association (NNA) furter assert that
TracFone's actions in Pennslvania reflect "patterns of behavior" evidenced "in several other states.'AQ
TracFonels reply assert, inter alia, that the allegations set fort in the NEA KeystonelAOCA Joint
Cornments are not relevant to TracFone's qualifications to be designated as an ETC and are a question of
3347 C.F.R.§ 54.405(b); see, e.g., Petitions for Designation as an Eligible Telecmmunications Caier in the State
of Connectieu and the COmmonwealth of Massachusett, CC Docket No. 96-45, Reply Comments ofTracFone. Wireles:, Inc., at io (filed Dec. 29, 2004). .
34 See supra par 5.
3S ET
Designtion Order, 20 FCC Red at 63KO-.par 20; 47 C.F.R. §§ 54.202(a), 54.209. For example, TrdcFonehas committed to provide high-quality service, as demonstrted by committing to comply with the Coiiumer Coe
for Wirless Service of the Cel'luar Telecommunications industr Association (CTA), and to serve the designated
areas within a reasonable tùue. See, e.g., New York Petition at 13-14. Because TracFone is a pure reeUer, eligible
for universaI-ervice Lifeline support only, we do not require it to demonstrte that it satifies the network build-out
and improvement requirements, or to provide a certification that it acknowledges that the Commission may require it
to provide equal åccs to long distace caiers in the event that no other eligible telecmmunications carier is'
providing equal aecs within the serice area. .
36 For example, TracFofi's universal servi~e offering wil provide benefits to customers in situations where they do
not have accs to a wire line telephone. See, e.g., New York Petition at 12, 14.
37 For example~ TracFone committed that it wil comply with the Consumer Code for Wireless Serice of
the CTIA.See, e.g., New York Petition at n.
38 See e.g., New York Petition at J 0- 14. As noted in the PSC Alabama Order, the mobilty oftelecmmunications
asists consumers in rural areas who oftn must drive signifcat disces to places of employment, stores, schools,
and other locations. PublícSerice Cellular, Inc. Petition/or Designion as an Eligible Telecommunications
Carrier in the States a/Georgia andAlabama, CC Docket No. 96-5, Order, 20 FCC Red 6854, 6861, par 25
(Wrreline Compo Bur. 2005) (PSC Alabama Order). Moreover, the'availabilty of a wirless unversal serice
offerig alo provides aecs to emergency servce that ca mitigate the unque riks of geogrhic isolation
. asociated with living in rul communities. It!
31 iracFone Wireles, Inc. Petition for Desigation as an Eligible Telecmmunications Caer in the
Commonweath of Pennlvaia, Joint Comments of th Penlvaa Offce of Conser Advocate and the
National Emergency Nwnbe Association, Keystne Chapter, CC Docket No. 96-5, 5-6 (fied Feb. 8, 2008)
(NA KeytonelAOCA Joint Comments).
40 See Leer from James R. Hobsolî Counel for the National Emergency Numbe AsOCiation, to Marlene H.
Dort Seeta, FCC, CC DocketNo, 96-5, 1-3 (fied Apr. 3, 2007) (NA Apr. 3,2008 &.Pare Lett).
7
:Federa Communications Commision Fceos-too
stte law, not commision regulation:l1 TracFone fuer denies tht it is in violation of the Pennsylvaiia
Act, and assert that the larger question of stte 911 funding requirements is more appropñately addr((at the natonal levei:,42 . .
16. We disagree with TracFone and find compliance with 911Æ911 reuirements relevant to
the public interes in this instance. In the Forbearance Order, the Commission expressly conditioned its
grnt of forbearce from the facilties requirement of section 214( e) of the Act on TracFone's
compliance with E911 reuirements applicable to wireless reseUers.43 The Commission adopted these
conditions becuse of the unique circumstances presented by TracFone's petitions for limited ETC
designation for Lifeline sUpport."4 The Commission furter require TracFone to submit a plan outlining
meaures to implement the conditions imposed in the Forbearance Order, and stated the Commission
would consider the plan in deciding whether to grant TracFone's petitions for limited ETC designation.4s
Given these circumstances, and in light of the concerns raised by NENA and the Pennsivania Offce of
Consumer Advocate, we ~nditon TracFone's designation as an ETC eligible for Lifeline support in each
state on TracFone's certification that it is in fun compliance with any applÍcable 9 l IÆ9 i I obligations,
including obligations relating to the provision, and supportof911 and E91 i service.46 Subject to this
condition, we find, on balance, that the advantages of designatig TracFone as a limited ETC in the
designated service areas outweiKh any potential. disadvantages.41 .
D. Designated Servce Areas
i 7. Based on the foregoing; we hereby designate TracFone as a limited ETC, eligible only for
Lifeline support in its licensed service area in New York, Virginia, Connecticut, Massachusett,
Alabama, Nort Carolina, Tennessee; Delaware, New Hampshire, Pensylvania, and the Distrct of
Columbia."8 In designating TracFone as a limited ETC, we clarfY that TracFone's designated service
areas do not enc-ompass federally-recognized tribally-owned lands.49
41 Petition for Designation as an Eligible Telecommunicationli Caer in the Commonwealth of Penns.ylvania, Reply
Comments ofTracFone Wireless, Inc., CC Docket No. 96:45,2-5 (fied' Feb. 25, 2008).
4i' Jd. at 5-9.
43 Se~ Forbearance Order, 20 FCC Red at 15102, para 16; infra at par. 20'-22.
44. See Forbearance Order, 20 FCC Rcd at l 5102, pam 16. The Commission noted that TracFone's Lifeline-
supported service may well be the customers' only means of accesing emergency personnel. Jd. Given the
potential grvity of the har ifTracFone's Lifeline customers canot obtain access to emergency services, the
Comiission adopted the conditions to protect Lifeline cutomers. Jd.
'(5Jd. at 15105, par. 25.
46 See NENA KeystoneIAOCA Joint Comments; NEA Apr. 3, 2008 Ex Parte Letter.
47 The Commission has already found that any effect on the universal servce fud would be minimal, limited to the
Lifeline progr, and outweighed by the benefit of increaing eligible parcipation in the Lifeline progr.
Forbearance Order, 20 FCC Red 15103-04, par 17. In addition, we need not pedonn acrekimming analysis
becuse TracFone is seeking to be eligibl~ for Lifeline support only.. .. .(8 Uìider this limited ETC designatio(L TracFone will not be eligible for support for Lin Up or toll-limitation
servce wider the low-inrome progr nor wil it be eligble for higl-cst suPPOrt or for schools and libries and
rul heath cae support as an ETC. Non-ET, however, may parciate in certin aspec of the schools and
libraes or mra health ca progr. See Forbearance Orde, 20 FCC Red at 15097, par 3 & n.12.
.(9 TracFone expresly stte that it does not reues ETC designation for trõallan. Pettions for Desigation as an
Eligible Telecmmwiication Caer in the States of Alabama, Nort Caolia, ànd Tenessee, CC Docket No. 96-
45, Reply Comments ofTracFone Wireless, Inc., at a22 (fied Feb. 2,2005).
8
Federal Communications Commision FCC 08-100
E. Regulatory Oversight and Compliance Plan
l 8. Under section 254( e j of the Act TracFone is require to us the specifc universal seivice
support it recives "only for the ¡rovision. maintenance. and upgrding of facilties and seivice for
which the support is intended:.s An.ETC reiving Lifeline support uses that support as intended when
it reduce the pnce of its telecommunications seivice by the amount of the support for the eligible
consumer.S1 Lifeline assistance shall be made available to qualifYing low-income consumer as soon as
the universal service fund Administtor certifies that TracFone's Lifeline serice offering satifies the
criteria in our roles and complies with the conditions imposed under the Forbearane Order.52 In
addition, TracFone must report certain information to the Commission and the Universal Service
Administrative Company (USAC) pursuant to section 54.209 of the Commission's roles.53
19. We find that reliance on TracFone's commitments to ~eet these requirements is
reasonable and consistent with the public interest and the Act and the Fift Circuit decision in Texas
Offce of Public Utilty Counsel v. FCC.54 These requirements wil furter the Commission's goal of.
ensunng that TracFone satisfies its obligation under section 214(e) of the Act to provide the servces
supported by the Lifeline program throughout iis designated service areas.
20. In addition;we note that, in the Forbearance Order, the Commission imposed additional
requirements on TracFone, and order~ tht TracFone file a compliance plan detailng how itwil adhere .
to these requirements. The additional requirements obligate TracFone to implement certain 91 l and E911
requirements and to establish certin administrtive procedures to safeguard against waste, frud, and
abuse in the Lifeline progmm.
2.1. Specifically. the Commission conditioned forbearance from the failties. requirement for
'Imited ETC designãtion upon TracFQne: (a) providin'g its Lifeline customers with 9ll and enhanced 911
(~911) access regardless of activation sttus and availabilty of prepaid minute; (b) providing its Lifeline
eustomers with E91 1 -cmpliant handset and replacing. at no additional charge to the customer. non-
compliant handsets of existing customers who obtain Lifeline-supported service; (c) complying with
conditions (a) and (b) as of the date it provides Lifeline s~rvice;(d)obtaining a certification from each
Public Safety Answering Point (PSAP) where TracFone provides Lifeline service conftring that
TracFone complies with condition (a); (t9 requiring its èustomers to self-certify at time of service
so 47 U.S.C. § 254(e). Bec~use rracFone is not eligible to receive high-cst support we do not reuire it to provide
high-cost certfications undèr §§ 54313 and 54.314 of our rules. See 47 C.F.R. §§ 54.313, 54.314.
SI See Forbearance Order, 20' FCC Red at 1$105-06. par. 26,
S2 See 47 C.F.R. §54.401(d). As noted above.. we find that TracFone's service offering meets the criteria for serice
and functionality contained in our rules. Seesupra par. II & n.29. We also approve TracFone's compliance plan.
rinding that it is adequate to implement the conditions oftle Forbearance Order. See ina par 21.
S3 See 47 C.F.R. § 54.209(a) (specifYing the information to be included in tle anual report submitted by ETCs);
El Designation Order. 20 FCC Red at 6400-602. par. 6&-69; see also' Virginia Cellular Order, 19 FCC Rcd at
15&4. par. 46 & n.140 (anticipatig tlat anual submisions wil encompas only the ETC's designated servce
ar). As noted above, as a pure reseUer eligible for Lifline suport only. we do not requir Tra~Fone to report on
netwoik build-out and ùoprovements or to cefY that it acknowledges tht the Commission may require it to
. provide eql ac to long dice caei in the event that no other eligible telecmmunications caer is
providing eqal acc witlin the servce ar. See sura note 15.
S' In TOPUC, the Fift Cirit held that that noth in secion 2l4(e)(2)'ofthe Act prhibits sttes frm imposing
additonal eligibilty coditions on ETC as pa of their designaton pro. See Taa Offce of Public Utilit
Cowiel v. FC~ in F 3d 393, 417-18 (5di Cir. 199) (TOPUC). Coist with th holding, we ïmd that nothg
in secon 214( e)(6) prohibit the Commion from impoing additional Conditions on ET when such
designations fal under our juriction.
9
Federal Communications Commis'ion FCC 08-100
actvation and anually therer that they are the head of household and reive Lifeline-supported.
service only from TracFone; and (f) esblisling safeguds to prevent its customers frm reciving
multiple TracFone Lifeline subsidies at the same address.55
22. The Commission caefully crafted the conditons of the Forbearance Order to mee
importt regulatory goals. We decline. therefore. to modifY thes conditions as requested by TracFone
in grnting the ETC designation reuests at issue herein.56 Consequently. TracFooe must obtain the
required certification from each PSAP where it wil provide Lifeline service.s7 Moreover. TracFone must
continue to provide access to-"basic and enhance 91 I servce" as described in section 20.18(m) of ourrules'sit Finally, TracFone must "distribute its Lifeline service directly to its Lifeline customers!.s9
23. After careful review of the compliance plan and the recrd. we find the compliance plan
adequate to implement the original and unmodified conditions of the Forbearance Order.60 We.
therefore, approve the compliance plan as discussed in this Order.ß .Forbearance Order, 20 FCC Rcd at 15098-99, par 6.
56 In its compliance 'plan, TracFone requests two modifications to the public safety conditions: First: TracFone
requests that, In :lieu of obtaining certification from each PSAP confuming accs to 9 I I and E9 I i, that it be
permitted to rely on the underlying caer's current quarterly E9 I I report filed with tle Conuission togeter with II
certification from TracFone that its Lifeline (;tomers in the relevant maret wil be served only by such caieres).
TracFone Compliànce Plan at 1-10. Second, TracFone requests that it be allowed to offer Lifeline service where
either 911 or E9 i 1 serviee is available. Id. at i 1-14. Ftier, TracFone states in its appiications tht it will
implement, upon designation as an ETC, the Lifeline cerification and verfication procedures set fort in an ex parte
presentation dated July 13. 2005. See, e.g., Delawa~ Pettion at 12; District of Columbia Petition at 12-13; Letterfrom Mitchell F. Brecher, Counsel for TracFone, to Marlene H. Dortch.' Secreta, FCC, WC Docket 96-45, Attch.
. (July 13. 200S). TracFone does not explicitly note. however, that the procedures set fori in that docuent were
rejecte. in par in the Forbearance Orde. See Forbearance Order, 20 FCC Red at 15104, par. 19; Distnct of
Columbia Public Servce Comlission Reply Comments~ CC Docket No.. 96-45, at 4-S (fied Mar. 13, 2008)
(Distrct of Columbia Reply). Out of an abundance of caution, we treat this omission as Ii request for modification
of the conditions of the Forbearance Order.
S7 See Fo~bearane(jrder, 20 FCC Rcd at IS102, p~ra. 16. We believe this requirement is suffcient to address the
District of Columbia Publíc Service Coimission's concer that. the DistnctofColumbia Offce of Unified;Communicaions be notified that TraeFone is providing Lifeiine service in the Distct of Columbia. . See Distrct ofColumbia Reply at4. . .
:Sf 47 U.S.C. § 20.l8(m) (emphasis added). We also note that CMRS providers are required to "trsmit all wireless
9 I i aills without respect to their call validation proces. . .." See 47 C.F.R. § 20. i 8(b). This rule addresses the
concerns of the District of Columbia Public Service Commission regarding the 9 i i capabilty of TraeFone handsets
"regardles of activation statu or minute availabilty." See Distrct of Columbia Reply at J; Revision of the
Commission s Rules to Ensure Compatibility with Enhanced 9 J I Emergency Callng Systems. CC Docket No. 94-
102, RM-8143, Report and Order and FwterNotice of Proposed Rùlemaking, 11 FCC Rcd 18676, 18691-99,
par. 29-46 (1996).
59 Forbearance Order. 20 FCC Red at lSI04, par 19.
6Õ In parcular, we disgree with USTelecm, who question whether TracFone wilÌ reive 12 month of Lifelinesupport if a subscrbe who chooses the anual prepaid plan uses all of the initial minutes in lle fir month or if a
'subscrb~ under the "NEto" plan redee fewer than 12 monthly coupons. See Petition ofTracFone Wirles
Inc. for Forbce from 47 U.S.C. § 214(e)(A) and 47 C.F.R § 54201(i). CC Doclet No. 96-45, Comments of
the Uiiited States Telecm Association, at J, 4 (fied Nov. 28. 2005) (USTelecm Compliance Plan Comments). We
find that TråcFone's plan for seekig reûuburement are consisent witf our Lifeline roles and proceures. Petition
ofTracFone Wireles Inc~ for Forbce from 47 U.S.C. § 214(eXl)A) and 47 C.F.R. § 54.20 i (i). CC Doet
No. 96-5. Reply Comments of TracFone Wireless. Inc.. at 6. 7 (ftOO Dec. 12.2005). Moreover, desite comments
to the contr. we are satified that TracFone will pas though all Lifeline Stppo as reqired by our iues. See
USTelec Compliance Plan Comments.at 1-2 Finlly, we fid that wé do not nee to clartY how Lieline suport
. (contiued...)
io
Federa Communications Commision FCC 08-100
24. Finally, we note that the ColIision may institute an inquir on its own motion to
exaine any ET's recrds and documentation to ensure that the universl serice support an ETC
recives is being used for the purpose for which it was intende€ 61 TracFone. wil be reuir to provide
such rerds and documentation to the Commision and USAC upon reques IfTracFone fails to fulfill
the requirements of the Act, our rules, the terms of !tis Order, or the conditions imposed under the
Forbearance Order after it begins reciving universal service Lifeline support the Commission may
revoke its limited ETC designation.62 The CommiS$ion may also assess fodeitures for violations of its
rules and orders.'l
IV. AN-DRUG ABUSE Act CERTICATION
25. Under section 5301 ofthe Anti-Drug Abuse Act of 1988, no applicat is elìgible for any
new, modified, or renewed instrument of authorization from the Commission, including authorizations
issued under section 214 of the Act, unless the applicant certifies that neither it, nor any par to its
application, is subject to a denial of federl benefits, including Commission benefits.64 TracFone has
provided a certification consistent with the requirements of the Anti-Drug Abuse Act of 1988.65 We find
that TracFone has satisfied the requirements of the Anti-Drug Abuse Act of 1988, as codified in sections
1.2001-1.2003' of the Commission's rules.66
V. ORDERIGCLAUSÈS
26. Accordingly, IT is ORDERED that, pursuant to.the authority contained in section
, iI4(e)(6) of the Communications Act, 47 U.S.C.§- i14(e)(6), TracFone Wireless, Inc. is DESIGNATED
AN ELIGIBLE TELECOMMICA nONS CARR eligible only for Lifeline support in its licensed
(.~.continued- from previous page)
will be calculated and distrbuted because we ar confident that USAC is caable of handling any administrtive
issues presented by TracFone's Lifeline offenng. See Forbearance Orde, 20 FCC Red at 151M, par. 20 (stting
that the ETC designation order would addrs how Lifeliie Support wil be calculate and distributed if the prepaid
natue of the offenngrequi.res such clarfication). The Forbearance Order also addressed the issue of double
recovery, noting that. although the Commission has in the past declined to extend ET statu to pure reseUer due to
concern about double recovery of universal service sUPpOrt, TracFone's CMRS wholesale providers are not subject
to s.ection 25 i (c)(4) wholesale obligations and so the' resold services presumably do not reflect a reduction in price
. due to Lifelme support. See id. at 15ioO~OI, par. 12. We, therefore, dismiss comments tathe contrry. See, e.g.,
Comments ofVerizon, Federal-State Joint Board Olt Universal Servìee: TracFone Wirless Inc., Petition for
Designation as ar Eligible Telecommunications Caer in the State of New York, Petition for Forbeance from
Application of Section 214, CC Docket No. 96-45 at9 (filed July 26, 2004).
6147 U.S.C §§ 220, 403.
62 See Federal-State Joint Board on Universal Serice, Wester Wireless Corporation Petitionfor Preemption of an
Order of the South Dakota Public Utilities Commission, CC Docket No. 96-45, Declartory Ruling, 15 FCC Rcd
15168, 15174, par, 15 (2000); 47 U.S.C. § 254(e); see also Forbearance Orde, 20 FCC Red at 15099, par 6,
n.25.
63 See 47 U.S.C. § 503(b).
6- 21 U.S.C. § 862; 47 C.F.R. § L2002(a)-). Section L.2002(b) provides that a "par to the application" shall
include: "(I) If the applicat is an individual, that individual; (2) If the applicant is a corpration or unincorprated
association, all offce, directors. or persons holdig 5% or more of the outsdig stock or shares (voti and/or
nonvotig) of the petioner and (3) If the applicaon is a parèrship. all non-limited parer and any limited
parer holding a 5% or more inter in the parership," 47 C. F. R. § i .2002(b). See Section 214(e)(6) Public
Notice 12 FCC Red at 22949.
6S See e.g., New York Petition at Exhibit I.
66 47 C.F.R. §§ 1.2001-2003.
II
Federal Communications Cnmmision FCC08-l00
servce ar in New York Virginia, Coeccu Maschuset, Nort Calina, Alabama, Tennesse,
'Delaware, New'Hampshire, Penlvana, and the Disct of Columbia to the exnt descnòed in thisOrder and subject to the conditions set fort herein.
27. IT is FUTIR ORDERED that, pursuat to the authority contained in section
214(e)(6) of the Communications Act, 41 U.S.C. § 214(e)(6), TracFone Wireless, Inc!s petition for
eligible telecmmunications carrer designation in the state of Florida is DISMISSED WIOUTPREICE to the extent described herein.
28. IT is FUTIR ORDERED that TracFone Wireless, Inc. WILL SUBMIT additional
information pursuant to section 54.209 of the Commission's rules, 47 C.F.R. § 54.209, no later than
October 1,2008, as part of its annual reporting requirements.
29. IT is FUTIR ORDERED that, pursuant to section i.103 of the Commission's rules,
47 C.F.R. § Ll 03, this Order SHALL BE effective upon release.
FEDERAL COMMCA nONS COMMSSION
Marlene H. Dortch
Secretary
.,-.;
ie:
12
Exhibit 4
State Utilty Commission Decisions Designating TracFone Wireless, Inc.
as an Eligible Telecommunications Carrier
STATE DECISION
Florida Application for designation as an eligible telecommunications carier (ETC) by
TracF one Wireless, Inc. for limited purose of offering lifeline service to qualified
households, Order No. PSC-08-0418-PAA- TP, Docket No. 070586- TP (Florida
Pub. Servo Comm'n: June 23, 2008)
Georgia Application of TracFone Wireless, Inc. for Designation as an Eligible
Telecommunications Carrier in the State of Georgia for the Limited Purose of
Offering Lifeline Service to Qualified Households, Order, Docket No. 26282
(Georgia Pub. Servo Comm'n: May 6,2008)
Ilinois TracFone Wireless, Inc. Petition for Designation as an Eligible Telecommunications
Carier in the State of Ilinois for the Limited Purose of Offering Lifeline Service
to Qualified Households, Order, Docket No. 09-0213 (Ilinois Commerce Comm'n:
September 10, 2009)
Maryland Letter from Terry J. Romine (Executive Secretary, Marland Public Service
Commission) to Debra McGuire Mercer, Greenberg Traurig, LLP) noting that the
Commission approved TracFone Wireless, Inc.'s Petition for Designation as an
Eligible Telecommunications Carier, August 19,2009.
Michigan Application of TracFone Wireless, Inc. for Designation as an Eligible
Telecommunications Carier Pursuat to Section 214(e) of the Telecommunications
Act of 1996, Order, Case No. U-15625 (Michigan Pub. Servo Comm'n: October 21,
2008)
Missouri Petition of TracFone Wireless, Inc. for Designation as an Eligible
Telecommunications Carrier in the State of Missouri for the Limited Purpose of
Offering Lifeline Services to Qualified Households, Order, Case No. TA-2009-0327
(Missouri Pub. Servo Comm'n: August 26, 2009)
New Petition by TracFone Wireless, Inc. for Designation as an Eligible
Jersey Telecommunications Carrier in the State of New Jersey for the Limited Purpose of
Offering Lifeline Services to Qualified Households, Order of Approval, Docket No.
T009010092 (New Jersey Board of Pub. Utilities: April 27, 2009)
Ohio In the Matter of the Commission Investigation of the Intrastate Universal Service
Discounts, Supplemental Finding and Order, Case No. 97-632-TP-COI (Ohio Pub.
Utilties Comm'n: May 21,2009), as modified by Entr on Rehearing (July 8,
2009)
Texas Application of TracFone Wireless, Inc. for Designation as an Eligible
Telecommunications Carrier in the State of Texas for the Limited Purose of
Offering Lifeline Service to Qualified Households, Order on Rehearing, Docket No.
36646 (Texas Pub. Utilty Comm'n: June 18,2009)
West TracF one Wireless, Inc. Petition for consent and approval to be designated an
Virginia eligible telecommunications carier, Recommended Decision, Case No. 08-1605-C-
PC (West Virginia Pub. Servo Comm'n: Feb. 25,2009) (Final on March 17,2009)
Wisconsin Petition ofTracFone Wireless, Inc. for Designation as an Eligible
Telecommunications Carrier in the State of Wisconsin, Final Decision, Docket No.
9385-TI-100 (Wisconsin Pub. Servo Comm'n: May 20,2009)
Exhibit 5
Federal Communications Commission . FCC 09-17
Before the
Federal Communications Commission
Washington, D.C. 20554
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Petition for Designation as an Eligible )
Telecommunications Carrier in the State of Florida )
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In the Matter of
Federal-State Joint Board on Universal Service
TracFone Wireless, Inc.
Petition for Designation as an Eligible
Telecommunications Carier in the State of New
York
Petition for Designation as an Eligible
Telecommunications Carrer in the
Commonwealth of Virginia
Petition for Designation as an Eligible
Telecommunications Carier in the State of
Connecticut
Petition for Designation as an Eligible
Telecommunications Carier in the
Commonwealth of Massachusetts
Petition for Designation as an Eligible
Telecommunications Carrier in the State of
Alabama
Petition for Designation as an Eligible
Telecommunications Carrier in the State of Nort
Carolina
Petition for Designation as an Eligible
Telecommunications Carrier in the State of
Tennessee
Petition for Designation as an Eligible
Telecommuncations Carier in the State of
Delaware for the Limted Puose of Offerig
Lifelie Servce to Qualified Households
Petition for Designation as an Eligible
Telecommuncations Carer in the State of New
Hampshie for the Limited Puose of Offerig
Lifeline Servce to Qualfied Households
Petition for Designation as an Eligible
Telecommuncatons Caer in the
Commonwealth of Pennylvana for the Limited
CC Docket No. 96-45
Federal Communications Commission FCC 09-17
Purse of Offerig Lifeline Servce to Quified )Households )
)
Petition for Designation as an Eligible )
Telecommunications Carer in the District of )
Columbia for the Limited Purose of Offering )
Lifeline Servce to Qualified Households )
ORDER
Adopted: March 4, 2009 Released: March 5, 2009
By the Commission:
i. INTRODUCTION
1. In this order, we grant a petition for modification filed by TracFone Wireless, Inc.
(TracFone). TracFone seeks modification of a condition imposed as part of the Commission's grant of
TracFone's request for forbearance allowing it to be designated as an eligible telecommunications carrier
(ETC) for the purses of providing low-income unversal service support to its customers under the
Lifeline program.
i Specifically, we grant TracFone's request to modify the requirement that TracFone
obtain a certification from each public safety answering point (PSAP) where it provides Lifeline service
confirming that TracFone provides its customers with access to basic and E911 service? TracFone must
still request such certification from each PSAP within its service area; however, if, within 90 days of
TracFone's request, a PSAP has not provided the certification and the PSAP has not made an affirmative
finding that TracFone does not provide its customers with access to 911 and E9l1 service within the
PSAP's service area, TracFone may self-eertfy that it meets the basic and E911 requirements. Grt of
this request wil allow TracFone to provide Lifeline service to low-income consumers within its service
areas in a timely maner, while also ensurig that TracFone's Lifeline customers have access to necessary
911 services.
1 See Petition for Modification of Public Safety Answering Point Certfication Condition by TracFone Wireless,
Inc., CC Docket No. 96-45 (fied Nov. 21, 2008) (TracFone Petition); see also Petiton ofTracFone Wireless,lnc.
for Forbearancefrom 47 U.S.c. § 214(e)(l)(A) and 47 C.P.R. § 54.20l(i), CC Docket No. 96-45, Order, 20 FCC
Rcd 15095 (2005) (TracFone Forbearance Order); Federal-State Joint Board on Universal Service, TracFone
Wireless, Inc. Petition for Designation as an Eligible Telecommunications Can-ier in the State of
New York et at.,
CC Docket No. 96-45, Order, 23 FCC Rcd 6206 (2008) (TracFone ETC Designation Order) (designating TracFone
as an ETC for Lifeline support only in New York, Virginia, Connecticut, Massachusetts, Alabama, North Carolina,
Tennessee, Delaware, New Hampshire, Pennsylvania, and the District ofColwnbia). Under the Lifeline program,
low-income consumers receive discounts on their monthly charges for local phone servce. 47 C.F.R. § 54.401. In
its initial comments on the petition, the Pennsylvania Public Utility Commission (pennsylvania Commission) sought
an extension of the pleading cycle, seeking four additional weeks for comments and two more weeks for reply
comments. Pennsylvania Commission Comments at 2. The Pennsylvania Commission filed comments and reply
comments, as well as an ex parte fiing in response to the TracFone Petition. See infra note 10; Letter from Joseph
K. Witmer, Assistant Counsel, Pennylvania Commission Law Bureau, to Marlene Dortch, Offce ofthe Secreta,
Federal Communcations Commssion, CC Docket No. 96-45 (dated Jan. 29, 2009) (pennylvania Commission
Januar 291h Ex Parte Lettr). We find that the Pennsylvania Commission was able to provide comment on the
Tracfone Petition without the need for an extension of the pleading cycle. We therefore deny the Pennylvana
Commission's request.
2 TracFone Forbearance Order, 20 FCC Red at 15102, para. 16; see also TracFone ETC Designation Order, 23
FCC Rcd at 6215, para. 22 (declinng Tracfone's request to modify the forbearance condition requirig TracFone to
obtain the required certfication frm each PSAP).
2
Federal Communications Commission FCC 09-17
n. BACKGROUN..
2. Section 254(e) of the Communcations Act of 1934, as amended, (the Act) provides that
"only an eligible telecommunications carier designted under section 214(e) shall be eligible to receive
specific Federal universal service support.,,3 Puruant to section 214(e)(1) of the Act, a common carer
designated as an ETC must offer the services supported by the federal universal serice mechanisms
either using its own facilties, or a combination of its own facilties and resale of another carer's
services.4
3. TracFone provides prepaid wireless services on a resale basis only, rather than providing
service over its own facilities.s On September 8,2005, the Commission conditionally granted TracFone's
request for forbearance from the facilties-based requirement of section 21 4( e)( I) of the Act. 6 Among
other things, the forbearnce grant was conditioned on the requirement that TracFone obtain a
certification from each PSAP where it provides Lifeline service confirming that TracFone provides its
customers with access to basic and E91 I service.7 On April II, 2008, the Commission conditionally
designated TracFone an ETC for the purose of receiving Lifeline support only in its licensed service
areas in New York, Virginia, Connecticut, Massachusett, Alabama, Nort Carolina, Tennessee,
Delaware, New Hampshire, Pennylvania,s and the Distrct ofColumbia.9 In the TracFone ETC
347 U.S.C. § 254(e).
447 U.S.c. § 214(e)(I)(A); see also 47 C.F.R. § 54.201(d)(1).
5 TracFone Petition at 3-4.
6 TracFone Forbearance Order, 20 FCC Red at 15102, para. 16.
7Id. at 15098, para. 6. Grant of forbearance was conditioned on TracFone: (a) providing its Lifeline customers with
911 and E91 1 access regardless of activation status and availabilty of prepaid minutes; (b) providing its Lifeline
customers with E91 1 -compliant handsets and replacing, at no additional charge to the consumer, non-cmpliant
handsets of customers who obtain Lifeline-supported service; (c) complying with conditions (a) and (b) as of the
date it provides Lifeline service; (d) obtaining a certification from each PSAP where TracFone provides Lifeline
service confirming that TracFone provides its customers with 9 i 1 and E9 i i access; (e) requiring its customers to
self -certfy at time of service activation and annually thereafter that they are the head of household and receive
Lifeline-supported service only from TraeFone; and (f) establishing safeguards to prevent its customers from
receiving multiple TracFone Lifeline subsidies at the same address. Id.
S At the time the Commission designate TracFone an ETC in Pennsylvania, the Pennsylvania Commission had not
exerted jurisdiction over wireless providers for purposes of ETC designation; therefore the Commission granted
TracFone ETC designation pursuant to section 214(e)(6) of the Act. TracFone ETC Designation Order, 23 FCC
Red at 6207, 621 i, para. 1,9; 47 U.S.c. § 214(e)(6). On Februar 26,2009, the Pennsylvania Commission
announced that it wil exert its jurisdiction, effective as of that date, to designate wireless carrier ETCs pursuant to
section 214(e)(2) of the Act. See Letter from Joseph K. Witmer, Assistant Counsel, Pennsylvania Public Utility
Commission, to Marlene H. Dortch, Secretary, Federal Communications Commission, CC Docket No. 96-45 (fied
Feb. 26, 2009) (attching February 26,2009 Pennsylvania Commission decision); 47 U.S.C. § 214(e)(2).
9 See TracFone ETC Designation Order, 23 FCC Rcd at 6207-08, para. i. The Commission conditioned grant of
TracFone's ETC designations on TracFone's certification that it is in full compliance with any applicable 91 l/E91 1
obligations, including obligations relating to the provision and support of91 i and E911 service. ¡d. at 6213, para.
16. The TracFone Petition and this order are limited to the PSAP certification requireent regarding TracFone's
provision of access to 91 i and E91 i serce to its customers. This condition is separte from the certfication
regarding TracFone's compliance with any state 91 lÆ911 obligations, including payment offees into state
91 1Æ91 i fuds. See Pennylvania Commission Januar 29thEx Parte Letter at 2 (expressing conce about
TracFone's compliance with the separte condition to certfY compliance with Pennsylvania law); Pennsylvania
Emergency Management Agency Petition to Reject, CC Docket No. 96-5 (filed Jan. 29, 2009) (asking the
Commission to reject TracFone's certfication for compliance with Pennsylvania 911Æ91 i obligations due to
TracFone's failure to contribute to Pennsylvania's Wireless E91 i Emergency Serces Fund).
3
Federal Commuiucations Commission FCC 09-17
Designation Order, the Commssion declined TracFone's request to eliate the condition that TracFone
obtain the required certfication from each PSAP where it will provide Lifeline service.1o
4. On November 21, 2008, TracFone filed the instat petition seekig to modify the PSAP
certfication requirements. Specifically, TracFone requests that, if a PSAP does not provide the requisite
certfication within 90 days of a request for such certification from TracFone, TracFone would be allowed
to self-certify that its customers will have access to 911 and E91 1 without regard to activation status or
availability of prepaid minutes. i 1
III. DISCUSSION
5. As the Commission found in the TracFone ETC Designation Order, TracFone's
universal service Lifeline offering wil provide a variety of benefits to Lifeline-eligible consumers,
including increased consumer choice, high-quality service offerings, and mobilty.12 In addition, the
prepaid feature ofTracFone's service, which essentially fuctions as a toll control featue, may be an
attactive alternative to Lifeline-eligible consumers who are concerned about usage charges or long-term
contracts. Therefore, we find that the public interest is served by allowing TracFone to offer its Lifeline
servce to consumers as quickly as possible, while alo ensuing that its consumers have access to
necessary emergency services.
6. The Commission has twice stressed the importance of ensung that TracFone's Lifeline
customers have access to 91 i and E911 services though the PSAP certfication process.13 We affirm that
TracFone must continue to comply with this requirement and seek certification from the PSAPs withn its
servce area. To ensure that the benefits of Lifeline service are made available to TracFone's customers
in a timely maner, however, we grant TracFone's request to allow it to self-certify compliance with the
911 and E911 availability condition if, with 90 days of TracFone's request, a PSAP has not provided
the certfication and the PSAP has not made an affrmative finding that TracFone does not provide its
cusomers with access to 911 and E911 service with the PSAP's service area.14 In mag a request for
certfication, TracFone must notify the PSAP that TracFone ha the option to self-certify within 90 days
of the request if the PSAP has not provided the certfication and the PSAP has not made an afrmative
findig that TracFone does not provide its customers with access to 911 and E911 service. TracFone may
not self-crtify compliance unti190 days after it has provided a PSAP with notification of
the 90-day self-
certification period adopted in this order. TracFone also may not make such a self-crtification until it
has provided a PSAP with all of the information and/or equipment requested by the PSAP in analyzing
I°Id. at 6213, para. 16.
1 I TracFone Petition at 1. On December 23, 2008, the Wireline Competition Bureau sought comment on TracFone's
petition. See Comment Sought on TracFone Wireless Inc. Petiion/or Modifcation o/Public Safety Answering
Point Certifcation Conditon, CC Docket No. 96-45, Public Notice, DA 08-2779 (Wireline Compo Bur., rei' Dec.
23,2008). Comments on the petition were due January 6,2009, and reply comments were due Januar 13,2009.
Comments were filed by Consumer Action, the National Emergency Number Association, and the Pennsylvania
Commission. TracFone and the Pennsylvania Commission filed reply comments.
12 See TracFone ETC Designation Order, 23 FCC Rcd at 6212, para. 15.
13 TracFone Forbearance Order, 20 FCC Rcd at 15102, para. 16; see also TracFone ETC Designation Order, 23
FCC Rcd at 6215, para. 22.
14 If a PSAP ha conducted testing and notified TracFone within the 90-dy penod of concern regardìng the abilty
ofTracFone customers to access 911 and E911 serces, TracFone may not self-certfy compliance until it has
addressed the PSAP's concerns (for example, issues with TracFone's underlyig wireless provider concerning
access to 911 and E91 i servces), such that the PSAP ca provide the reqired certfication. In this circumstace,
TracFone may self-cerify 180 days after requesting certfication from the PSAP if the PSAP does not approve or
deny the certfication withi that period.
4
Federal Communications Commission FCC 09-17
Tracfone's abilty to provide 911 and E911 service to its customers. IfTracFone makes such a self-
certfication, TracFone must obta from each of its underlyig carriers that provide servce to TracFone
in the area served by that PSAP certification that the carers route 911 and E911 cals from TracFone
customers to the PSAP in the same maner that they route 911 and E911 calls from their own customers.
TracFone is required to retain such underlyig carrier certfications and provide them to the Commssion
upon request. TracFone must provide PSAPs with copies of any self-certfications at the tie they are
filed If afer TracFone makes a self-certfication a PSAP finds that TracFone does not provide its
customers with 911 and E911 access, upon receiving notice of this finding TracFone must immediately
notify the Commission of this finding and explain how it plans to come into compliance with this
condition.
7. The Pennsylvania Commission opposed TracFone's request for a modification of
the
PSAP certification requirement, stating that TracFone has refused to comply with the "dnve testing"
requirements included as par of Pennsylvania's Phase II 911 compliance.ls It is unclea from the
Pennylvana Commission's filing whether such state "drive testig" requirements apply to resale
services, such as those provided by TracFone, or whether a demonstration of successful "drive testing" of
the underlying wireless provider's service would comply with the state requiement. As this Commssion
stated in the TracFone ETC Designation Order, TracFone's designation as an ETC eligible for Lifeline
support in each state is conditioned upon TracFone's certification that it is in full compliance with any
applicable 911Æ911 obligations, including obligations relatig to the provision and support of911 and
E911 servce.16 Therefore, TracFone must comply with any state requirements that are applicable to
carrers providing servce on a purely-resale basis. We do not find that the Pennsylvania Commission's
claim of TracFone's non-compliance with the state "dnve testing" requirement warants denial of
TracFone's request for a 90-day PSAP certification period. As discussed above, TracFone's customers
should not be denied the benefits .of access to Lifeline SUPPOlt for a prolonged period of tie pending
PSAP action on TracFone's certification requests. We therefore grant TracFone's request and allow ìt to
self-certfy its provision of911 and E911 services to its customers, and also requie it to obtain
certfication from its underlying carers, if, within 90 days ofTracFone's request for certification, a
PSAP has not provided the certfication and the PSAP has not made an affirmative finding that TracFone
does not provide its customers with access to 91 i and E911 service within the PSAP's service area. To
the extent an entity disagrees with TracFone's self-certfication, it may fie a request asking the
Commission to examine the issue pursuant to section 1.41 of the Commission's rules.17
IV. ORDERIG CLAUSES
8. Accordingly, IT is ORDERED that, pursuant to the authority contaned in sections 1,
4(i), 4(j), 2l4(e) and 254 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i),
154(j), 214 and 254, the petition for modification fied by TracFone Wireless, Inc. is GRAD as
discussed herein.
IS Pennsylvania Commission Reply Comments at 7-s.Th; Pennsylvania Commission also requests that the
Commission revisit the decisions granting TracFone's"forbearance request and ETC designation in Pennsylvania.
¡d. at 9, 12-17. Pursuant to section 1. I06(f) of the Commission's rules, petitions for reconsideration of Commission
actions must be filed within 30 days from the date of public notice of the final Commission action. 47 C.F.R. §
1.106(f). The public notice dates of both the TracFone Forbearance Order and the TracFone ETC Designation
Order were their release dates puruant to section lA(b )(2) of the Commission's rues. 47 C.F .R. § 1.4(b )(2).
Those dates were September 8, 2005, and Aprill 1,2008, respectively. The Pennsylvania Commission's reply
comments were fied on Janua 13,2009, well outside of the 30-dy recnsidertion deadlines for both orders. The
Pennylvania Commission's oppositions to those decisions are therefore untimely and will not be considered here.
16 TracFone ETC Designation Order, 23 FCC Red at 6213, para. 16.
17 47 C.F.R. § 1.41.
5
Federal Communications Commision FCC 09-17
9. IT is FUTHR ORDERD that the Pennylvana Public Utilty Commssion's request
for an extension of the pleadig cycle is DENID.
10. IT is FURTHER ORDERED that, puruant to section 1.03 of the Commission's rules,
47 C.F.R. § 1.103, ths order SHAL BE effective upon release.
FEDERAL COMMCATIONS COMMSSION
Marlene H. Dortch
Secretary
6
Exhibit 6
Privacy Policy
SAFELINK WIRELESS(¡ service is U.S. government supported program for Income eligible households provided by
TracFone Wireless.
Please read the TRACFONE Privacy Policy.
TRACFONE Wireless has instituted a comprehensive set of privacy policies and procedures to ensure that its Web
site visitors' privacy is never compromised. The purpose of this privacy notice is to inform our Web site visitors of
the type of information that TRCFONE, or a credit card processing partner acting on its behalf, collects from the
Web site, how the information is gathered, how it is utilized, how long it is retained and how visitors can restrict
its use or disclosure.
The primary focus of TRACFONE's privacy policy is to ensure that all Web site visitors' customer identification,
which we term "customer identifiable information," is kept private at all times. As the term suggests, "customer
identifiable information" is information which can be associated with a speific individual or entity, including, for
example, a customer's name, address, or telephone number, e-mail address and information about online activities
that are directly linked to them.
The collection of customer identifiable information is a critical element in the day-to-day operation of the Web
site to allow TRACFONE to maintain the highest level of customer servce for all Web site visitors. It is a common
practice and often a necessity for companies, governments. or other organizations to collect customer identifiable
information in order to conduct business and offer services.
TRACFONE always strives to safeguard the customer identifiable information obtained from its Web site users and
visitors (collectively, "customers") from any unauthorized intrusions.
TRACFONE may contact people on the home phone number they enter on our website, input into our automated
phone system or give to an agent in case of technical difficulties, promotions and/or reminders.
General
TRACFONE will not sell, trade, or disclose to third parties any customer identifiable information derived from the
registration for, or use of, a TRACFONE product or service _. including customer names and addresses .. without
the consent of the customer. TRACFONE wil, however, disclose customer identifiable information as required by
subpoena, search warrant, or other legal process or in the event that such customer is engaging in unlawful use of
our Web site.
When TRACFONE uses third parties to perform servces on its behalf, TRACFONE will request that such third parties
protect your customer identifiable information consistently with this privacy policy. However, we cannot ensure
that all of your customer identifable information will never be disclosed, as regulatory and/or other requirements
may make disclosure necessary.
Collecion and Use:
In some instances, TRACFONE may collect information that is not "customer identifiable information." Some
examples of this type of information include the type of Internet browser you are using, the type of operating
system you have configured on your computer, and the domain name of the Web site and/or Internet Serice
Provider from which you are linked to our Web site. TRACFONE primarily uses this information for market research
and optimizing its systems in order to deliver the bet customer experience possible.
TRACFONE may collect and use customer identifable information for various purposes, including but not limited
to, biling purposes, to provide or change servce, to anticipate and resolve problems with your service, or to
inform you of products and services that better meet your needs. This means that TRACFONE may use your
customer identifiable information, in conjunction with information available from other sources, to market new
services that may be of interest to you, but TRACFONE will not disclose your customer identifiable information to
third parties who want to market products to you.
Declining e-mail offers:
TRACFONE wil only send our customers e-mail regarding promotional offers or other news if a customer
specifically grants us permission. A customer has the right to choose not to receive TRACFONE e-mail direct
marketing communications by simply notifying us of their preference. This process is commonly termed opting-out
or unsubscribing. At any time, a customer can unsubscribe from our e-mail list by clicking on the unsubscribe link
found at the bottom of every message or promotion delivered electronically to our customers. Upon such choice,
TRACFONE (a) will not contact that customer directly with TRACFONE promotional messages, and (b) will not use
customer identifiable information obtained from that customer's registration to contact that customer with
TRACFONE product or service messages. A customer may also choose not to receive such messages by notifying
TRACFONE via fax or mail.
Security:
TRACFONE has gone to great lengths to implement technology and security features to safeguard the privacy of
your customer identifiable information from unauthorized access or improper use, and TRACFONE, based on its
judgment, wil continue to enhance its security procedures as new technology becomes readily available.
However, since there is no such thing as "perfect Internet security", TRACFONE cannot provide any guarantees of
100 security compliance.
E-mail Contents:
TRACFONE wil not read or disclose to third parties private e-mail communications that are transmitted using
TRACFONE servces except as required to operate the servce or as otherwise authorized by law_
Improper Conduct:
TRACFONE may also use customer identifiable information to investigate and help prevent potentially unlawful
activity or activty that threatens the network or otherwse violates the customer agreement for that servce.
Account Information:
TRACFONE honors requests from customers for account information and wil correct any such information, which
may be inaccurate. Customers may contact TRACFONE to venfy that appropriate corrections have been made.
Cookies
When you visit our Web site, we may store information on your computer that allows us to identify you
immediately. This process is often referred to as "cookie" technology. More specifically, a cookie is a commonly
used Internet standard which stores, in a very small text fie on the customer's hard disk, information specific to
the customer. Our Web site makes limited use of cookies in an effort to improve our level of service to our Web
site visitors. Cookies cannot be accessed by any other Web site other than the Web site issuing the cookie. The
private features of our Web site are only accessible when cookies are enabled in the customer's browsr. If a
customer does not wish to utilze cookies, this feature may be disabled within the customer's Web browser.
However, by disabling cookies, a customer wil not have access to pnvate areas of our Web site through that
browser.
Other Web sites
Since TRACFONE's Web site contains links to other Web sites, we are not responsible for the content or pnvacy
practices employed by these other Web sites. It is possible that on some occasions, these third party Web sites
may in fact collect personal information from our customers. We recommend that you examine the pnvacy policies
of such third part Web sites pnor to submitting any personal information. as they may differ from ours.
In some instances, our Web site content is also featured on other Web sites with differing or non-existent privacy
policies. These Web sites may collect personal information from their customers that mayor may not be used in
conjunction with our Web site information. Pnor to supplying any personal information to any third party company
linking to our Web site, please read and understand their privacy policy.
Advertisements
Advertisements may appear on pages throughout our Web site. Some advertisements may request information
directly from our customers or take our customers to Web sites that may request personal information. TRACFONE
has no control over its advertisers' pnvacy policies, so please examine the privacy policy of any company
advertising on our Web site prior to submittng any personal information.
Third Party Advertising Companies
We may use third-part advertising companies to serve ads on our behalf. These companies mayemploy cooies
and action tags (also known as single pixel gifs or web beacons) to measure advertising effectivenes. Any
information that these third parties collect via cookies and action tags is completely anonymous. If you would like
more information abut this practice and your choices, dkk here. You may also visit the Advertising.com Privcy
Policy, click here.
Surveys
OCcasionally, we may conduct surveys on our Web site. Surveys are conducted at random and are completely
voluntary to our Web site visitors. The survey may require a customer to provide customer identifiable information
in exchange for the information or services provided by the survey. We may use this information in an aggregate
manner to better tailor the type of servces, information, and advertising that are provided on our Web site.
Policy Changes
TRACFONE reserves the right to change its privacy policy by publishing new terms on its Web site at any time and
your access and useof the TRACFONE Web site thereafter constitutes youracknowledgment and acceptance of such
amended policy. This privacy policy does not create any legal right for you or any third parties.
Children
TRACFONE Web sites are not structured to attract children under the age of 13. TRACFONE believes there is no
information on its Web site, which is inappropriate or objectionable for viewing by children.
TRACFONE does not knowingly, directly or passively, collect information from children under the age of 13. If we
create offers and products that make it appropriate to collect information from children under the age of 13, we
wil notify you of the change in this Policy. We also will ask a parent to confirm his/her consent in advance of any
collection, use or disclosure of that information. We do not collect any information that is not submitted to us. We
only use personally identifiable information so that we may better understand our users' needs and send
information to users regarding new services or offerings, including but not limited to any sweepstakes or other
offering. We do not sell any personally identifable information or disclose any personally identifiable information
to third parties.
Ordering online products and services from TRACFONE is limited to adults (ages 18+). However you should be
aware that wireless deices and services purchased for family use may be used by minors without the knowledge of
TRACFONE. If that happens, any information collected from the usage wil appear to be the personal information
of the actual adult subscriber and treated as such under this Polrcy. .
Questions?
Please direct any questions or comments regarding our privacy polrcy to inforrm\tío~tracfooe.wm.
Exhibit 7
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Exhibit 8
SAFELINK WIRELESS 1M
Terms and Conditions of Service
................................................................................................................................................................................. ....................................................................................................................................................
Please read these SAFELINK WIRELESS Terms and Conditions of Service carefully. SAFELINK WIRELESS is a
service of TracFone Wireless, Inc. ('TracFone Wireless") These SAFELINK WIRELESS Terms and Conditions of
Service are a legally binding agreement between you and TracFone Wireless. They contain important
information about your legal rights, and require that certain disputes be resolved through Arbitration instead
of a court triaL. TracFone Wireless reserves the right to change or modify any of these SAFELINK WIRELESS
Terms and Conditions of Service at any time and at its sole discretion. Any changes or modifications to these
SAFELINK WIRELESS Terms and Conditions of Service wil be binding once posted on the SAFELINK WIRELESS
website found at
By qualifying and enrolling in the SAFELINK WIRELESS servce (or Service) and by using the service (or Service).
participant ("You") acknowledges and agrees to the following terms and conditions:
SAFELINK WIRELESS SERVICE DESCRIPTION
SAFELINK WIRELESS service (or Service) is a U.S. government supported program for income eligible households
provided by TracFone Wireless. In order to participate in the SAFELINK WIRELESS Servce, a person must meet
certain eligibility requirements set by each state where the Servce is to be provided. These requirements are
based on a person's participation in a state or federal support program(s) or by meeting the Income Poverty
Guidelines as defined by the U.S. Government. SAFELINK WIRELESS Servce is limited to one (1) per household and
only the head of household is permitted to apply for this Service. Any person applying for the SAFELINK WIRELESS
Service must complete an application form, provide supporting documentation that he/she meets the eligibility
requirements and agrees, under penalty of perjury, to the following terms:
· HE/SHE IS ELIGIBLE FOR AND CURRENTLY RECEIVES BENEFITS FROM THE PUBLIC ASSISTANCE PROGRA(S)
IDENTIFIED IN THE APPLICATION FORM.
· HE/SHE IS A HEAD OF HOUSEHOLD.
· HE/SHE DOES NOT CURRENTLY RECEIVE LIFELINE SUPPORT FOR A TELEPHONE LINE SERVING HIS/HER
RESIDENTIAL ADDRESS AND NO OTHER RESIDENT IN HIS/HER HOUSEHOLD PARTICIPATES IN THE LIFELINE
PROGRAM. IF HE/SHE IS ALREADY PARTICIPATING IN ANOTHER LIFELINE PROGRAM, THEN HE/SHE AGREES TO
CANCEL HIS/HER CURRENT HOUSEHOLD LIFELINE SUPPORT PROVIDER IN FAVOR OF SAFELINK WIRELESS.
· HE/SHE IS NOT CLAIMED AS A DEPENDENT ON ANOTHER PERSON'S FEDERAL OR STATE INCOME TAX RETURN.
· HE/SHE WILL NOTIFY SAFELINK WIRELESS WHEN HE/SHE NO LONGER QUALIFIES FOR ANY OF THE PUBLIC
ASSISTANCE PROGRAS IDENTIFIED IN HIS/HER APPLICATION FORM BY CALLING 1- 800-SAFELINK.
· HE/SHE WILL NOTIFY SAFELINK WIRELESS OF ANY CHANGE OF ADDRESS BY CALLING 1- 800,SAFELINK
· THAT THE INFORMTION CONTAINED IN HIS/HER APPLICATION FORM IS TRUE AND CORRECT TO THE BEST
OF HIS/HER KNOWLEDGE AND BELIEF.
A person who submits a SAFELINK WIRELESS application. together with supporting documentation (when required).
and who meets the eligibility requirements, wil receive a free cellular phone provided by TracFone Wireless
together with a free allotment of airtime minutes each month for one year. TracFone Wireless will determine at
its sole discretion whether or not an applicant meets the eligibility requirements to participate in the SAFELINK
WIRELESS Service. The airtime minutes you will receive on a monthly basis wil vary from state to state. Please call
SAFELINK WIRELESS at 1-800-SAFELINK or visit our website at www.SafeHnkWkeless.Cúff, for further information
on the number of minutes you will receive each month (if you qualify to participate in the Servce). Persons who
do not meet the eligibility requirements wil be notified by U.S. Mail and the reason for the non-eligibility wil be
provided. To continue qualifying each year for SAFELINK WIRELESS'" Servce, each customer wil be required and is
responsible to re-qualify on an annual basis or as dictated by their local state Public Servce Commission. For
annual re'qualifìcation requirements, TracFone Wireless will also conduct verification drives for each state
according to its rules. If TracFone Wireless determines during its verification drive that a customer fails to re-
qualify for SAFELINK WIRELESS Service, such customer will immediately be deemed ineligible to participate in the
SAFELINK WIRELESS Service and wil no longer receive the free monthly minutes. Once a customer no longer
participates in the SAFELINK WIRELESS Servce (either by choice, disqualification. cancellation or termination),
such customer may retain the SAFELINK WIRELESS handset, as well as any remaining service days and minutes for
their use. Such person may remain as a TracFone Wireless customer as long as he/she complies with the TracFone
Wireless Terms and Conditions of Service set forth at www.tracfone.com. Upon the request of a state and/or
federal authority, a SAFELINK WIRELESS customer's enrollment may also be cancelled. TracFone Wireless and
SAFELINK WIRELESS reserve the rightto cancel the enrollment of any customer and/or ban the SAFELINK WIRELESS
phone from being reactivated for any fraud related issues as determined solely by TracFone Wireless. While
participating in the SAFELINK WIRELESS Service, a customer shall not be permitted to sell, rent, give away or in
any way allow another person to use the cellular phone or Service provided to him/her by SAFELINK WIRELESS. If it
is determined that a SAFELINK WIRELESS participant violates these requirements and/or this Agreement, then such
person wil be de-enrolled from the Service, the person's handset wil be permanently deactivated and the person's
personal information wil be permanently flagged so that such person may not qualify in the future for the
SAFELINK WIRELESS Service. If you have any questions, concerns, comments or complaints regarding SAFELINK
WIRELESS Service, offerings or products, please call SAFELINK WIRELESS Customer Care at 1- 800-SafeLink. You
may also contact your state's Public Service Commission/Public Utility Commission.
ACTIVATING AND USING YOUR SAFELINK WIRELESS HANDSET.
If your SAFELINK WIRELESS application is accepted, you wil receive a pre-activated SAFELINK WIRELESS phone
delivered to your home address noted in the applîcation. You must accept the SAFELINK WIRELESS telephone
number assigned to your SAFELINK WIRELESS phone at the time of activation and you wil acquire no proprietary
interest in any number assigned to you. The number assigned to your SAFELINK WIRELESS phone at the time of
activation wil not be changed for any reason, unless required by a Carrier, nor maya SAFELINK WIRELESS customer
select a number to be assigned to his/her phone. The wireless telecommunications networks used to transmit calls
for the SAFELINK WIRELESS Service are owned and operated by various licensed commercial mobile radio servce
providers ("Carriers"), not SAFELINK WIRELESS, nor TracFone Wireless. Your SAFELINK WIRELESS phone can only be
used through TracFone Wireless, and cannot be activated with any other wireless or cellular service. SAFELINK
WIRELESS Services are provided at TracFone Wireless'" discretion. Some functions and features referenced in the
Manufacturer's manual provided with your SAFELINK WIRELESS phone may not be available on your SAFELINK
WIRELESS handset. TracFone Wireless may modify or cancel any Service or take corrective action at any time
without prior notice and for any reason, including but not limited to your violation of this agreement. While you
are eligible and participating in the SAFELINK WIRELESS Servce, you wil receive your free monthly allotment of
airtime minutes. However, in order to receive the monthly allotment you wil need to turn on and leave on your
SAFELINK WIRELESS handset the first few days of each month.
SELF.RETRIEVE AIRTIME MINUTES
If you DO not receive your monthly allotment of minutes because your phone was not on at the beginning of the
month or your phone does not automatically retrieve minutes when turned on, your minutes may be self-retrieved
by following the instructions below. If for any reason these instructions do not work on your handset, please call us
at 1-800-SafeLink.
1. 1) Turn your SafeLink Wireless phone ON.
2. 2) From the Main screen, press the MENU key. Select "Prepaid."
3. 3) From the menu select, "Add Airtime/ Redeem Airtime."
4. 4) Dial 5 5 5 and press OK. If you are prompted for a promotional code, press "No."
Make sure to keep your SAFELINK WIRELESS phone ON to receive your Minutes!
If your phone does not allow you to self-retrieve or your phone does not automatically retrieve or if you are having
difficulty receiving your monthly allotment of minutes, then call SAFELINK WIRELESS Customer Care at 800-
SafeLink.
AIRTIME RATES.
SAFELINK WIRELESS airtime is issued in minute/unit increments. ("Units" are the same as minutes.) Minutes/units
are deducted from the SAFELINK WIRELESS phone in the following manner: all calls are charged at a rate of one (1)
unit per minute. There is no additional charge for nationwide long distance or for international long distance to
countries designated at
TEXT MESSAGING.
The rates to send or receive a text message to another person's phone using your SAFELINK WIRELESS PHONE are
0.3 minutes/units per text message, for sending and 0.3 minutes/units per text for receiving. If you do not want
minutes/units deducted from your SAFELINK WIRELESS phone, then do not send a text message and/or do not open
any incoming text messages. SAFELINK WIRELESS Servce does not allow international text messages. Attempting to
send international messages could result in service deactivation. Please note that SAFELINK WIRELESS does not
generally participate in Premium SMS services or campaigns. Premium SMS refers to activities that usually involve
sending a text message to a designated "short code" or buying or attempting to buy SMS servces from anyone other
than SAFELINK WIRELESS. Premium SM campaigns include activities such as casting a vote, expressing your
opinion, playing a game, subscribing to a service, or interactive television programs. You should not attempt to
participate in Premium SMS campaigns, unless it is a SAFELINK WIRELESS authorized campaign. Any text message
you send to a "short code" will in all likelihood not go through. Any charges you may incur as a result of any
attempts to participate in Premium SMS services or campaigns (not authorized by SAFELINK WIRELESS) whether you
incur charges as deductions from your SAFELINK WIRELESS phone or from your credit card, are not refundable. You
may purchase from SAFELINK WIRELESS ring tones, graphics and certain information services and utilize multi-
media services with certain SAFELINK WIRELESS models. See SAFELINK WIRELESS Data Services below.
INTERNATIONAL CALLING.
You may now use your SAFELINK WIRELESS phone to make international calls to land lines (including some cellular
phones in some countries) at no additional charge (See www.tracfone.comfor available countries and details). The
available countries are subject to change without prior notice. In order to place an international call, you wil
need to dial the international long distance access number 1-800-706- 3839 and follow the instructions. From
Alaska, Hawaii and the U.S. Virgin Islands you wil need to dial 305-938-5673 as the international long distance
access number. Airtime deductions for international calls begin the moment the International Long Distance ("LD")
access number is dialed and apply to dropped calls, misdialed numbers and busy destination numbers. When
making international calls, you may experience connection failures more frequently than calls made within the
United States. SAFELINK WIRELESS wil not credit airtime minutes deducted for unsuccessful calls. You wil not be
able to make or receive calls on your SAFELINK WIRELESS phone when you are located outside of the United States,
Puerto Rico or the U.S. Virgin Islands.
ADDING AIRTIME.
Your SAFELINK WIRELESS phone will only operate when you have airtime minutes/units available on the SAFELINK
WIRELESS handset. If you run out of your free monthly allotment of airtime, you may purchase and add airtime to
your phone. You add airtime by entering the PIN (obtained from either a SAFELINK WIRLESS or TracFone Wireless
airtime card). You must add your airtime to your SAFELINK WIRELESS phone within one year from the date of
purchase; otherwise the card/PIN expires and you wil not be able to add those minutes to your SAFELINK
WIRELESS phone; nor receive a refund for any unused minutes.
AIRTIME CARDS.
SAFELINK WIRELESS customers may purchase and use for their SAFELINK WIRELESS handset any TracFone Wireless
airtime cards, including Double Minute Airtime cards. Each TracFone Wireless airtime card comes with a number of
minutes and a servce period that begins to run from the day you add airtime to your SAFELINK WIRELESS phone.
The free monthly allotment of minutes received by the SAFELINK WIRELESS customer while enrolled in the Double
Minutes for Life program wil not double with the purchase and addition of any airtime cards.
NOTE: On the 60, 90 and 120 minute TracFone Wireless airtime cards, SafeLlnk Wireless customers will
receive an additional 40, 35 and 30 minutes respectively, and these minutes do not double with any TracFone
Wireless Double Minute airtime cards.
For each TracFone Wireless airtime card purchased and used on a SAFELINK WIRELESS handset, the SAFELINK
WIRELESS customer wil receive the following:
Card Minutes Service OtherDays
60 100 90 N/A
90 125 90 N/A
120 150 90 N/A
200 200 90 N/A
450 450 90 N/A
One Year 250 orService400 365 N/A
Card
Double minutes for life of single handset after you
One Year purchase and add this card; not transferable to
plus 800 365 another handset even if phone is damaged, lost or
Double stolen. The minutes that come with this card wil not
Minute double. Free monthly minutes to SAFELINK WIRELESS
customers do not double.
Double minutes for life of single handset after you
Double purchase and add this card; not transferable to
Minute 0 0 another handset even if phone is damaged, lost or
Card stolen. The minutes that come with this card wil not
double. Free monthly minutes to SAFELINK WIRELESS
customers do not double.
You may also purchase SAFELINK WIRELESS airtime cards at selected retail stores. SAFELINK WIRELESS customers
will receive the following:
Card Minutes Service Days Other
15 15 0 N/A
25 25 0 N/A
50 50 0 N/A
For each additional TracFone airtime card you add your Service End Date will be extended by the number of days
specified on the card or cash register receipt, without limitation. "Servce End Date" is the last day of your service
period. Airtime minutes added to your SAFELINK WIRELESS handset do not expire with active servce and at least
one Transaction during a consecutive sixty day period. A 'Transaction" shall be defined as anyone of the following
(i) your phone's receipt of the monthly allotment of airtime or the purchase; (ii) addition of either a TracFone
Wireless or SAFELINK WIRELESS airtime card or (ii) usage of your phone (making a call, text or data usage). Airtime
minutes do not have any cash value. Promotional, bonus and other non-purchased airtime minutes will not double.
The purchase of any airtime card is non-refundable. Airtime cards, airtime rate plans, and card denominations are
subject to change without prior notice.
SERVICE END DATE AND DEACTIVATION.
SAFELINK WIRELESS enrolled customers will receive 365 days of service upon qualification, enrollment and then
another 365 days of service for re-qualification and re-enrollment. If you use your phone regularly and receive your
monthly minutes, but do not re-qualify or re-enroll and/or do not purchase and add airtime prior to the Service
End Date, which is the date displayed on your handset screen, your servce wil be deactivated on the last day of
service (your Service End Date), In the event TracFone Wireless requires you to re-qualify and re~enroll in the
SAFELINK WIRELESS Service and you fail to do so and you do not purchase a TracFone airtime card providing service
days, then your service will be deactivated on your Servce End Date and you wil lose your handset phone
number, even if you have minutes remaining. To prevent this from occurring, please keep your handset service
active by both re-qualifying and re-enrolling or by purchasing and adding TracFone airtime cards before the
Service End Date. Notwithstanding the Service End Date displayed on your handset, SAFELlNK WIRELESS and
TracFone Wireless reserve the right to cancel the enrollment of any handset from the SAFELINK WIRELESS service
when your handset remains 60 consecutive days with no Transaction. If your SAFELlNK WIRELESS Service is
deactivated because of 60 consecutive days with no Transaction, your handset may be reactivated by calling 1-
800-SafeLink within the twelve month period from the initial enrollment or requalification date. When re-
activated within the twelve month period of service, you wil receive the monthly minutes that you were entitled
to receive until being deactivated but will loose any minutes that you would have received during your
deactivation period. If you attempt to re-activate after twelve months from the initial enrollment or
requalification date then you will need to re-qualify and re-enroll and no compensation or replacement of unused
minutes will be provided.
Once you reactivate, your SAFELINK WIRELESS handset may be assigned a new phone number.Airtime which
remained at the time of deactivation wil remain on your handset if it is reactivated within 60 days from the
deactivation date. However, airtime which remained at the time of deactivation may be lost if your handset
service remains deactivated for longer than 60 days.
AIRTIME USAGE. Airtime minutes wil be deducted for all time during which your SAFELINK WIRELESS phone is
connected to, or using, the wireless system of any Carrier. Use of a wireless system typically begins when you
press the "send", "call" or other key to initiate or answer a call and does not end until you press the "end" key or
the call is otherwise terminated. Airtime minutes are deducted for all incoming and outgoing calls, including
incoming call waiting calls, calls to toll free numbers, 411, 611, Customer Care, and to access your voice mail.
Airtime minutes are deducted for all text messages sent and all incoming text messages which are opened. Airtime
minutes are not deducted for calls to 911. For outbound calls, you may be charged airtime for incomplete and / or
busy-no answer calls. Airtime minutes are deducted in full unit increments; partial minutes are rounded up to the
next minute. Airtime minutes wil also be deducted for use of other services such as text messaging and accessing
the TracFone Wireless Mobile Web ("WAP"). No credit is given for dropped calls.
UNAUTHORIZED USAGE; TAMPERING. The SAFELINK WIRELESS handset is provided exclusively for use by you, the
end consumer with the SAFELINK WIRELESS Service available solely in the United States, Puerto Rico and the U.S.
Virgin Islands. Any other use of your SAFELINK WIRELESS handset, including without limitation, any resale,
unlocking and/or re-flashing of the handset is unauthorized and constitutes a violation of your agreement with
TracFone Wireless. You agree not to unlock, re-flash, tamper with or alter your SAFELINK WIRELESS phone or its
software, enter unauthorized PIN, engage in any other unauthorized or illegal use of your SAFELINK WIRELESS
phone or the Service, or assist others in such acts, or to sell and/or export SAFELINK WIRELESS handsets outside of
the United States. These acts violate TracFone Wireless r" rights and state and federal laws. Improper, illegal or
unauthorized use of your SAFELINK WIRELESS phone is a violation of this agreement and may result in immediate
discontinuance of Services and legal action. TracFone Wireless wil prosecute víolators to the full extent of the
law. You agree that any violation of this agreement through your improper, ilegal or unauthorized use or sale of
your SAFELINK WIRELESS phone shall entitle TracFone Wireless to recover liquidated damages from you in an
amount of not less than $5,000 per SAFELINK WIRELESS handset purchased, sold, acquired or used in violation of
this agreement.
Some SAFELINK WIRELESS handsets have SIM cards. If your SAFELINK WIRELESS phone has a SIM card, then you
agree to safeguard your SIM card and not to allow any unauthorized person to use your SIM card. You agree not to
allow any other person to, directly or indirectly alter, bypass, copy, deactivate, remove, reverse-engineer or
otherwise circumvent or reproduce the encoded information stored on, or the enciyption mechanisms of, your SIM
card. The Carriers, TracFone Wireless, or its servce providers, may, from time to time, remotely update or change
the encoded information on your SIM card. Your SAFELINK WIRELESS phone is restricted from operating when you
are located anywhere outside of the United States, Puerto Rico or the U.S. Virgin Islands, including offshore or in
international waters. Any such calls are considered unauthorized usage by TracFone Wireless for which your
Service wil be immediately suspended. In the event of suspension for this or any other unauthorized usage, you
wil not be entitled to receive any refunds for your handset or unused airtime.
COVERAGE MAPS.You wil find coverage maps on our website, www.tracfone.com. These maps are for general
informational purposes only. TracFone Wireless does not guarantee coverage or service availability. Even within a
coverage area, factors such as terrain, weather, structures, foliage, signal strength, traffic volumes, service
outages, network changes, technical limitations, and your equipment may interfere with actual service, quality
and availability. Thus, it is possible your phone will roam even in the area depicted as your home calling area.
Actual coverage and service areas may vaiy from the maps and may change without notice.
ROAMING. "Roaming" occurs when a subscriber of one wireless service provider uses the facilities of another
wireless servce provider. Roaming most often occurs when you make and receive calls outside the home calling
area. When your SAFELINK WIRELESS phone is roaming, an indicator light on your handset may display the word
"Roam" or "RM" on the screen while the phone is not in use. There are no additional charges for roaming calls for
the SAFELINK WIRELESS phone you were provided. Availability, quality of coverage and Servces while roaming are
not guaranteed.
LIMITATIONS OF SERVICE AND USE OF EQUIPMENT. Service is subject to transmission limitations caused by certain
equipment and compatibility issues, atmospheric, topographical and other conditions. Further, Servce may be
temporarily refused, limìted, interrupted or curtailed due to system capacity limitations. technology migration or
limitations imposed by the Carrier, or because of equipment modifications, upgrades, repairs or relocations or
other similar activities necessary or proper for the operation or improvement of the Carrier's radio telephone
system. At anytime, TracFone Wireless reserves the right to substitute and/or replace any SAFELINKE WIRELESS
equipment (including handsets) with other SAFELINK WIRELESS equipment including handsets of comparable
quality. Some functions and features referenced in the Manufacturer's manual for a particular SAFELINK WIRELESS
handset may not be available on your phone. TracFone Wireless does not warrant or guarantee availability of
network or of any Services at any specific time or geographic location or that the Services wil be provided without
interruption. Neither TracFone Wireless, nor any Carrier, shall have any liability for Servce failures, outages or
limitations of Service. Because of the risk of being struck by lightning, you should not use your SAFELINK WIRELESS
phone outside during a lightning storm. You should also unplug the SAFELINK WIRELESS phone power cord and
charger to avoid electrical shock and/or fire during a lightning storm.
WARRANTY EXCHANGE fi LOST OR STOLEN PHONE POLICY
Warranty Exchange Policy:SAFELlNK WIRELESS customers shall have up to one year from the activation date of
their phone to return any defective phone to TracFone Wireless. TracFone Wireless wil exchange a defective
phone for another phone during this period of time only. For a defective phone replacement, call SAFELINKWIRELESS Customer Care at 1-800- 378-1684.
Exclusions and Conditions.This limited warranty does not cover damage or failure caused by abuse or misuse of
the phone or accessories. TracFone Wireless does not provide refunds. All applicable implied warranties, including
the implied warranties of merchantabilty and fitness for a particular purpose, are limited to the duration of this
limited warranty, unless otherwise provided by law. Your limited warranty excludes all incidental or consequential
damages, unless otherwise provided by law. Some states do not allow the exclusion or limitation of incidental or
consequential damages, so the above limitation or exclusion may not apply to you. This limited warranty gives you
specific legal rights, and you may also have other rights which vary from state to state.
Lost or Stolen Phone Policy: For any lost or stolen SAFELINK WIRELESS phone, you may request and receive only
one replacement phone per customer (The replacement phone wil be a refurbished phone). All reported lost and
stolen phones wil be permanently deactivated. For the replacement phone resulting from a lost or stolen phone,
SAFELINK WIRELESS wil only replace the airtime minutes equivalent to the last Transaction (either the last
monthly allocation of free minutes or the last airtime card redemption added to the phone). In the event you lose
your replacement phone or it is stolen, you wil need to purchase an additional phone. If a phone is lost or stolen
in transit to the customer, before the customer receives the phone, then the airtime minutes will be reimbursed
and the phone replaced (one time only). TracFone Wireless reserves the right to determine if a phone was lost or
stolen in transit and decide whether to provide the customer with a new handset.
HEARING, VISUAL OR SPEECH IMPAIRED ACCOMMODATIONS
Any hearing, visual or speech impaired persons interested in applying for a specially equipped SAFELINK WIRELESS
must specify the need(s) in the application and TracFone Wireless wil make every effort to assist such customer in
obtaining a handset and at the same time be in compliance with all applicable laws, rules, and regulations.
EMERGENCY CALLS.
If you are in an area where your SAFELINK WIRELESS phone is searching for a wireless signal or there is no wireless
signal or wireless service, it is highly probable that a call to 911 wil not go through. Do not rely solely on your
SAFELINK WIRELESS in an emergency situation. In an emergency, locate the nearest landline phone and call for
help.
DATA SERVICES.
With certain SAFEUNK WIRELESS phone models, you can download ring tones, graphics, access information services
such as news, weather and sports ("nformation Services") and utiize multi-media services ("MoS") (ringtones,
graphics, Information Services and MoS are collectively referred to as "Data Services") through our Wireless Mobile
Web ('WAP"). Data Services are additional Services offered by us and there is an additional charge or debit of
minutes/units for use of such services.
Access/Purchase Data Services. In order to purchase, download or access Data Servces, your handset must have
active service and sufficient available airtime (minutes). Your handset will not let you open the WAP browserwithout an airtime balance of at least 10 minutes.
Each time you access our Wireless WAP with your handset's browser, 0.5 units per minute wil be deducted from
your handset ("Access Charges"). Access Charges are deducted in full minute increments. WAP access of less than
60 seconds is rounded up to the next full minute.
Access Charges begin when your handset makes a data connection. This should occur shortly after you open your
browser, send or receive a multi-media message (e.g., a picture), initiate a content download, view subscribed
Information Services or if WAP access is initiated for any other purpose. Access Charges end when the data
connection terminates. This should occur shortly after you close your browser, successfully receive or send a multi-
media message (e.g., a picture), after a successful content download or after any other closure of a WAP session.
The WAP access duration and the related Access Charges are NOT determined from the exact moment you press a
button on your handset to open or close the browser.
In addition to the Access Charges, there wil be an additional one-time charge for any content you select to
download ("Content Charge") and if you subscribe to an Information Services ("Subscription Charge"). The Content
Charges and Subscription Charges vary depending on the type of content and/or subscription. You wil be advisedof the Content Charges and/or Subscription Charges prior to finalizing your purchase.
The Data Services you purchase and download may only be used or viewed on the handset for which they were
purchased and cannot be transferred to any other device, including a new or replacement handset. Data Services
are non-refundable and non-transferable.
Purchase Options for Data Services: You may purchase Data Services either through your handset's WAP browser
or through the Internet (with a personal computer) at WVW. tracfone.com.
When you purchase Data Services from the Internet at www.tradone.com. the Content Charge wil be shown in
both U.S. Dollars and in minutes/units. You wil have the opportunity to select one of two payment options: (1)
using a credit card to pay the purchase price shown, or (2) a direct deduction of minutes from your SAFEUNK
WIRELESS handset. If you buy a TracFone card the number of minutes to be charged is based on the last airtime
card added to your handset. See Purchasing Data Services With Airtime Minutes below.
How to purchase from the Internet (www"tracfurie.com): Go to "Ringtones and More" at www.tracfone.com and
enter your SAFELINK WIRELESS serial number (ESN IIMEI). This wil take you to the Wireless Data Services content
catalog where you can browse, sample and purchase ringtones andlor graphics. After you find a title, and select
"Buy", you will then be presented with the two purchase options described above.
How to purchase through your handset's WAP browser: Select "BROWSER" on your handset. Then select "Start
Browser" and you wil be presented with a menu. When you use your handset's WAP browser to purchase Data
services, only the unit charge purchase option is available. Credit card payments are not available when
purchasing through your handset. Note: Ringtones can only be sampled at
Purchasing Data Services With Airtime Minutes: If you add TracFone airtime cards, the charges for Data Servces
purchases are determined by the last airtime card added to your handset. The chart below details the number of
minutes you wil be charged for each dollar you spend for the Data Services you purchase. Your TRACFONE will be
assigned the appropriate dollar-to-minute conversion factor each time an airtime card is added to your handset.
The charges for Data Services in U.S. Dollars and/or minutes and the dollar-to-minute conversion factor(s) are
subject to change without prior notice.
Doiiar~To.Minute Conversion Factors for Data Services
If the last airtime card you You wil have this number of minutes deducted
added to your handset was:per dollar you spend on Data Services:
TRACFONE Airtime Cards
30, 40 or 60 minute cards 3.00
90 minute card 3.60
100 or 120 minute cards 4.00
200,250 or 400 minute cards 5.00
450 minute card 5.62
200, 250 or 400 minute cards 3.00with Double Minutes
Annual Plan and Double Minute Prepaid Plan Cards
150 unit Annual Plan card 1.66
250 unit Annual Plan card 2.50
400 minute Annual Plan Card 4.00
800 minute Annual Plan Card 5.71
Double Minute Card without N/Aminutes
300 minute Double Minute 2.30Annual Prepaid Plan Card
400 minute Double Minute 3.07Annual Prepaid Plan Card
Regular Airtime Cards Added to TRACFONE's with active Double Minute Benefi
30, 40 or 60 minute cards with 6.00Double Minutes
90 minute card with Double 7.20Minutes
100 or 120 minute cards with 8.00Double Minutes
200, 250 or 400 minute cards 10.00with Double Minutes
450 minute card 11.24
Other (not listed above) Airtime 6.00cards with Double Minutes
Subscription to Information Services. For Data enabled phones, SAFELINK WIRELESS offers two options for
subscription-based Information Services (news, weather and sports): (1) a one-day (24 hour) subscription or (2) a
30-day subscription.
A subscription for Information Services allows you to view the various Information Services during the duration of
the subscription. For example, a 3D-day subscription allows access to news, weather and sports at any time during
the 3D-day period. In addition to the initial Subscription Charge to purchase the one-day or 30-day subscription,
you wil also incur Access Charges whenever you open your handset's WAP browser to access/view the Information
Services. The Access Charge is 0.5 minutes/units per minute. Subscriptions to Information Services can only be
purchased directly from your handset.
Subscriptions to Information Services are only accessible on the handset on which they were purchased and cannot
be transferred to any other device, including a new or replacement handset. Information Services are non-
refundable and non-transferable.
Your SAFELINK WIRELESS Service must remain active to access your subscription to Information Service. If your
service expires, your subscription to Information Services wil be terminated. Your Information Services
subscription wil not be reinstated, even if your handset is reactivated during the original subscription period.
There is no pro-rated refund of Subscription Charges as a result of deactivation or expiration of service.
Charges for MMS (e.g., picture messaging). You wìl be charged 1.0 unit to send or receive a multi-media message
(the "MMS Charge"). In addition to the 1.0 unit MMS Charge, there wìl also be an additional WAP Access Charge of
0.5 units per minute for the time it takes to send or receive the multi-media message. The total WAP Access
Charge will vary depending on the size of the multi-media message being sent or received.
Additional Access Charges for Data Services. In addition to the Content Charges, Subscription Charges and MMS
Charges, and regardless of the payment option you use, there is always an additional Access Charge of 0.5 units
per minute associated with downloading content, accessing/viewing Information Services or utilzing MM. Total
Access Charges wìl vary depending on the size of the content and the actual time it takes to download the
content, access/view the Information Service or utilize MMS.
Modifications, Interruptions, or Discontinuation of Data Servlce.SAFELINK WIRELESS does not guarantee the
availability of Data Services neither on all its models nor at any time. SAFELINK WIRELESS reserves the right to
modify, suspend, interrupt, discontinue or permanently cancel Data Services, or portions thereof, without notice.
Data Services are not available in analog service areas. SAFELINK WIRELESS is not responsible and wìl not be liable
for any modifications, interruptions or discontinuation of the Data Services or for any failure in receipt of the
purchased Data Services. If the Data Servces, or any part thereof, for which you subscribe, are modified,
interrupted, discontinued or canceled, SAFELINK WIRELESS wìl NOT refund/reimburse you for any remaining used
or unused subscription time. If you cancel, or attempt to cancel a Data Service download, a subscription purchase
or a multi-media message in progress, or if this process is otherwise interrupted through no action on your part,
you may nevertheless be charged in accordance with the terms and conditions set forth herein.
Non-Rated Content. SAFELINK WIRELESS and TracFone Wireless strive to present and offer only generally
acceptable content. However. it is impossible to proof all content, titles and news articles for appropriate
content. Our wireless content is NOT rated and you are solely responsible for the use of such material, which may
be offensive or objectionable to you or to others. You agree not to hold SAFELINK WIRELESS or TracFone Wireless
liable for any offensive or objectionable content.
LIMITATION OF L1ABILlTY.TracFone Wireless wil not be liable to you for any indirect, special, incidental,
consequential. exemplary or punitive damages of any kind, including lost profits (regardless of whether it has been
notified such loss may occur) by reason of any act or omission in its provision of equipment and Services. TracFone
Wireless will not be liable for any act or omission of any other company furnishing a part of our Services or any
equipment or for any damages that result from any Service or equipment provided by or manufactured by third
parties. When your SAFELINK WIRELESS phone is returned to SAFELINK WIRELESS for any reason, TracFone Wireless
is not responsible and shall not be liable to you or anyone else for any personal information such as user names,
passwords, contacts, pictures, SMS, MN and/or additional downloads you may have stored on your phone or which
may remain on your phone.
INDEMINIFICATION. You agree to indemnify and hold harmless TracFone Wireless from any and all liabilities,
penalties, claims, causes of action, and demands brought by third parties (including the costs, expenses, and
attorneys' fees on account thereof resulting from your use of a SAFELINK WIRELESS phone and/or use of the
SAFELINK WIRELESS Servces, whether based in contract or tort (including strict liability) and regardless of the
form of action.
BINDING ARBITRATION. PLEASE READ THIS SECTION CAREFULLY AS IT AFFECTS RIGHTS THAT YOU MAY
OTHERWISE HAVE. IT PROVIDES FOR RESOLUTION OF ALL DISPUTES AND CLAIMS (INCLUDING ONES THAT
ALREADY ARE THE SUBJECT OF LITIGATION), EXCEPT FOR CLAIMS CONCERNING THE UNAUTHORIZED RESALE,
EXPORT, ALTERATION, AND/OR TAMPERING OF YOUR SAFELINK WIRELESS PHONE, ITS SOFTWARE, THE SERVICE
AND/OR PIN NUMBERS, THROUGH ARBITRATION INSTEAD OF SUING IN COURT IN THE EVENT THE PARTIES ARE
UNABLE TO RESOLVE A DISPUTE OR CLAIM. ARBITRATION IS BINDING AND SUBJECT TO ONLY A VERY LIMITED
REVIEW BY A COURT. THIS ARBITRATION CLAUSE SHALL SURVIVE TERMINATION OF TRACFONE WIRELESS..
AGREEMENT WITH YOU.This provision is intended to encompass all disputes or claims arising out of your
relationship with TracFone Wireless, arising out of or relating to the Service or any equipment used in connection
with the Service (whether based in contract, tort, statute, fraud, misrepresentation or any other legal theory).
Nothing contained in this arbitration provision shall preclude TracFone Wireless from bringing claims concerning
the unauthorized resale, export, alteration, and/or tampering of your SAFELINK WIRELESS phone, its software, the
Service and/or PIN numbers in state or federal court. References to you and TracFone Wireless include our
respective subsidiaries, affiliates, predecessors in interest, successors, and assigns. All claims wil be resolved by
binding arbitration where permitted by law. You must first present any claim or dispute to TracFone Wireless by
contacting Customer Care to allow an opportunity to resolve the dispute prior to initiating an arbitration. The
arbitration of any dispute or claim shall be conducted in accordance with the American Arbitration Association
("AM") under the Commercial Dispute Resolution Procedures and the Supplementary Procedures for Consumer
Related Disputes (collectively, "AM Rules"), as modified by this agreement. The AM Rules are available online at
www.tracfOrlB.comor by calling the AM at 1-800-778-7870. You and TracFone Wireless agree that use of the
Service evidences a transaction in interstate commerce and this arbitration provision wil be interpreted and
enforced in accordance with the Federal Arbitration Act and federal arbitration law. All issues are for the
arbitrator to decide, including the scope of this arbitration clause, but the arbitrator is bound by the terms of this
agreement. You and TracFone Wireless agree that any arbitration wil be conducted on an individual basis and not
on a consolidated, class wide or representative basis. Further, you agree that the arbitrator may not consolidate
proceedings or more than one person's claims, and may not otherwise preside over any form of a representative or
class proceeding, and if this preclusion of consolidated, class wide or representative proceedings is found to be
unenforceable, then this entire arbitration clause shall be null and void. All fees and expenses of an arbitration
,l
will be divided between you and TracFone Wireless in accordance with the WIA Rules, except that TracFone
Wireless wil reimburse you for the amount of the filing fee in the event you prevail in the arbitration. Each party
wil bear the expenses of its own counsel, expert, witnesses, and preparation and presentation of evidence. If for
any reason this arbitration provision is deemed inapplicable or invalid, or to the extent this arbitration provision
allows for litigation of disputes in court, you waive to the fullest extent permitted by law, (i) the right to a trial by
jury and (ii) any claims for punitive or exemplary damages. Unless TracFone Wireless and you agree otherwise, the
location of any arbitration shall be Miami, Florida. Except where prohibited by law, TracFone Wireless and you
agree that no arbitrator has the authority to award punitive damages or any other damages not measured by the
prevailing party's actual damages. Neither you nor TracFone Wireless shall disclose the existence, contents, or
results of any arbitration, except to the extent required by law. Judgment on the award rendered may be entered
into by any court having jurisdiction thereof.
PRIVACY POLICY. To view the SAFELINK WIRELESS Privacy Policy refer to the SAFELINK WIRELESS website found at