1997 Congressional Hearings
Intelligence and Security



SUBCOMMITTEE ON CRIME

COMMITTEE ON THE JUDICIARY

U.S. HOUSE OF REPRESENTATIVES

OVERSIGHT HEARING ON

THE IMPLEMENTATION OF THE COMMUNICATIONS ASSISTANCE FOR LAW ENFORCEMENT ACT OF 1994



Wednesday, October 23, 1997

Room 2237 Rayburn Building, 10:00 AM



Kitchen Testimony

WRITTEN TESTIMONY OF

JAY KITCHEN, PRESIDENT

PERSONAL COMMUNICATIONS INDUSTRY ASSOCIATION

ON

THE COMMUNICATIONS ASSISTANCE FOR LAW ENFORCEMENT ACT

BEFORE THE

SUBCOMMITTEE ON CRIME
HOUSE OF REPRESENTATIVES

OCTOBER 23, 1997


I. INTRODUCTION AND SUMMARY

PCIA is the international trade association created to represent the interests of both the commercial and the private mobile radio service communications industries. As such, many of its members are providers of personal communications services ("PCS"), which is a type of broadband commercial mobile radio service that was intended to, and does, compete directly with cellular telephony.
Ever since the enactment of the Communications Assistance For Law Enforcement Act ("CALEA") on October 25, 1994, PCIA has played an important role in the statute's implementation. Specifically, PCIA has: (1) met with the FBI and its CALEA Implementation Unit ("CIU") in an effort to explain the unique difficulties the wireless industry in general, and the PCS industry in particular, have had in implementing CALEA; (2) taken an active part in the FBI's notice and comment rulemakings that implemented various sections of CALEA; and (3) sponsored many meetings that brought wireless carriers and manufacturers together in order to attempt to promulgate technical standards for CALEA-compliant network equipment.
Further, even as CALEA is being implemented, PCIA's member carriers have continued to cooperate with law enforcement officials in executing legitimate electronic surveillance warrants. This cooperation stems not just from their statutory obligation to do so, but from a recognition on the part of wireless carriers that the public safety is significantly advanced by the appropriate use of electronic surveillance techniques.
Against this background, PCIA offers its perspective on two of CALEA's most important requirements: the assistance capability requirements of Section 103, under which networks must be accessible to authorized wire tapping, and the capacity requirements of Section 104, under which a specific number of circuits must be reserved for law enforcement use. First, because technical standards for CALEA-compliant network equipment have yet to be promulgated, manufacturers cannot build this equipment, and carriers cannot purchase and install it. Therefore, Congress should amend CALEA to set a date that at least 24 months after the date such technical standards are promulgated for the date on which carriers must comply with the assistance capability requirements. In addition, all equipment installed or deployed before this deadline should be either deemed compliant or retrofitted at the government's expense.
Second, Congress should ensure that in setting capacity requirements, the FBI takes into account the presence of multiple wireless carriers within a market. Congress should further ensure that the FBI reduces the capacity requirements for wireless carriers, promulgates wireless capacity requirements on a county-by-county basis, and does not group call content intercepts with trap and trace devices when calculating the capacity requirements.

II. WHILE CONGRESS BELIEVED THAT CALEA-COMPLIANT EQUIPMENT WOULD BE AVAILABLE SOON AFTER JANUARY 1, 1995, SUCH EQUIPMENT IS STILL UNAVAILABLE BECAUSE STANDARDS HAVE NOT YET BEEN AGREED UPON

Congress enacted CALEA in large part because the new, digital telecommunications networks have become increasingly resistant to wire-tapping efforts by law enforcement officials. Importantly, however, CALEA was not intended to expand the technical capabilities of law enforcement, but only to give them the same capabilities in the age of digital equipment as they had in the analog era. Therefore, in order to ensure that law enforcement officials could continue to carry out legitimate electronic surveillance efforts, Congress required that pursuant to the "assistance capability requirements" of Section 103 of CALEA, each carrier's network must be designed in a manner that allows law enforcement officials to expeditiously isolate and intercept both call-content and call-identifying information.
Carriers cannot meet their statutory obligations to provide law enforcement officials with this information unless they have access to switching equipment that is CALEA-compliant. If manufacturers are to provide carriers with this compliant equipment, there must be industry-wide technical standards that they can follow in designing and building their switches.
In drafting CALEA, under Sections 106 and 107, Congress contemplated that carriers, manufacturers, and law enforcement officials, in cooperation with industry associations or standard-setting organizations would cooperate to develop technical standards. Manufacturers would then build switches to these standards, and, soon after January 1, 1995, carriers would be able purchase and install this CALEA-compliant equipment.
Thus, even if the process worked exactly as planned, a carrier's ability to comply with CALEA would depend upon the ability and willingness of industry representatives and the FBI to reach a timely consensus on standards, and manufacturers' ability and willingness to manufacture compliant equipment in a timely fashion. Carriers would, however, as the entities responsible for ensuring that their networks are CALEA-compliant, be left "holding the bag" if this process broke down.
Unfortunately, a breakdown of monumental proportions has occurred. As of today, final standards have not been set, in large measure due to the actions of law enforcement officials. Initially, the FBI waited almost one and one-half years after the enactment of CALEA to submit its recommendations to standards setting bodies. After the submission of this list, industry representatives and the FBI were able to reach consensus on standards that provided, by PCIA's estimates, 90 percent of the capabilities that the FBI had requested. Since then, however, the FBI has held up the entire standards setting process in order to ensure that every capability on its "wish list" is made part of the standards.
This wish list consists of ten capabilities that most carriers believe to be either not required by CALEA, technically infeasible, or both. Thus, while carriers and manufacturers have acquiesced to virtually every law enforcement demand regarding CALEA capabilities, certain items of this "wish list" simply should not, and cannot be implemented. For example, the FBI has demanded timely, electronic notification of changes to a subject's feature capability that may prevent the delivery of intercepted communications, and separated delivery of content for each party in a multiparty call.
This continued delay is irrational and disserves the public interest. Law enforcement officials would have most of the capabilities they need if the proposed standards currently agreed upon by all parties were adopted today and the wish list items were deferred. Time is of the essence, because as carriers build out and upgrade their networks, they are buying new switching equipment. If this equipment were CALEA-compliant even if that term does not include the wish list items then law enforcement officials would be able to carry out most of their legitimate electronic surveillance missions. Otherwise, more and more networks will be built to non-CALEA specifications and will have to be retrofitted to comply with the statute's requirements.
Further, this lack of agreed upon standards, and the consequential lack of CALEA-compliant equipment, threatens carriers with civil sanctions. Specifically, carriers whose networks do not comply with the assistance capability requirements by October 25, 1998 just one year from today can be fined up to $10,000 a day.
Therefore, the compliance deadline for the assistance capability requirements should be changed from October 25, 1998 to the date that is at least 24 months from the date that CALEA technical standards are approved. Because it takes a minimum of 24 months from the time a technical standard is promulgated until equipment based on that standard can be mass produced, such an adjustment will allow carriers to purchase and install CALEA-compliant equipment within the statutory deadline.

III. THE LACK OF CALEA-COMPLIANT EQUIPMENT, AND COMPETITIVE CONCERNS, INDICATE THAT CONGRESS SHOULD ADJUST ITS REIMBURSEMENT AND GRANDFATHERING POLICY

Section 109 of CALEA distinguishes between network equipment that was installed or deployed before January 1, 1995, and network equipment that was installed or deployed after that date. Specifically, the Attorney General is commanded to either reimburse carriers for making their pre-1995 equipment CALEA-compliant or deem that equipment to be in compliance (i.e., grandfather it). For post-1995 equipment, however, carriers are responsible for paying the costs of ensuring CALEA-compliance. Implicit in this statutory scheme is the commercial availability of CALEA-compliant equipment soon after January 1, 1995.
The aforementioned failure to reach an agreement on standards and the consequential failure of manufacturers to produce CALEA-compliant equipment has blown a huge hole in this statutory scheme. As a result of this failure, new carriers, such as providers of personal communications services, are placed in a financial bind. First, they must construct their entire networks from scratch at great expense. Then, when CALEA-compliant equipment becomes available, they will have to retrofit their networks to make them CALEA-compliant again, at great expense.
Established carriers, on the other hand, will be reimbursed for whatever retrofitting expenses they incur, thereby placing them at a competitive advantage relative to new carriers. These competitive inequities will be particularly acute for PCS providers, which have post-1995 networks, as compared to cellular providers, which have pre-1995 networks. While both entities will be selling a similar product broadband wireless communications services PCS providers will have the additional, and substantial expense of making their networks CALEA-compliant, thereby placing them at a competitive disadvantage.
Congress should act to ensure that PCS providers which will provide cellular carriers with much needed competition are permitted to compete on a level regulatory playing field. Ensuring such regulatory parity will allow the carriers that provide the best combination of price, features, quality, and service to triumph in the marketplace rather than pre-ordaining the result by asymmetric regulation.
The best way to level the regulatory playing field is to change CALEA's reimbursement policy so that any network equipment that is installed or deployed before CALEA-compliant equipment is commercially available is either deemed to be in compliance or eligible for reimbursement. Such an amendment will also fulfill Congress's original intent in enacting CALEA that individual carriers not be required to pay retrofitting costs that should rightfully be borne by the government.
One way in which an equipment retrofit can be accomplished in a cost-effective manner is through the development of software upgrades for all switches, whether they were manufactured before or after 1995. PCIA is currently working with the FBI and switch manufacturers to develop a program whereby the FBI uses the monies allocated under Section 110 for the retrofitting of pre-1995 equipment to contract for the development and distribution of this software. Congress should, however, be aware that the Section 110 authorization is only for the years 1995 through 1998, and might consider extending that authorization.
Finally, in order to make this software upgrade program consistent with the language of CALEA, Congress must amend Section 109(a) to allow the Attorney General to pay telecommunications carriers and telecommunications equipment manufacturers for the costs of making both their pre-1995 equipment and their post-1995 equipment CALEA-compliant. These statutory changes will allow carriers, manufacturers and the FBI to proceed with a program that represents the fastest and most efficient means of bringing all of the nation's switches into CALEA compliance.

III. THE CAPACITY REQUIREMENTS FOR WIRELESS CARRIERS ARE TECHNICALLY DEFICIENT AND SHOULD BE ALTERED

In its Second Capacity Notice, pursuant to Section 104 of CALEA, the FBI mandated actual and maximum capacities or the number of circuits that must be reserved for law enforcement use for both wireline and wireless carriers. The capacity requirements for wireline carriers were mandated by county, while the capacity requirements for wireless carriers were mandated by wireless service area, including Metropolitan Statistical Areas ("MSAs") and Rural Statistical Areas ("RSAs") for cellular carriers, and Major Trading Areas ("MTAs") and Basic Trading Areas ("BTAs") for PCS carriers. While the wireline capacity requirements were based on the historic number of landline wiretaps, the wireless capacity requirements were based on the historic number of cellular wiretaps.
In light of the large size of the wireless service areas used by the Bureau and the amount of competition in the wireless market, the proposed capacity requirements for wireless carriers are excessive. Initially, the FBI should not extrapolate the capacity requirements for an entire MTA based on a single metropolitan area, as this requires carriers to substantially overbuild their capacities. For example, in the New York MTA, only New York City and its suburbs (i.e., the New York BTA) require a significant number of intercepts. Nevertheless, carriers serving this MTA must build the capacity necessary to meet the law enforcement needs of the New York metropolitan area into their entire networks which extend from New Jersey to Vermont.
Further, at present, local wireline telephone companies do not face a great deal of competition in their markets, if any at all. Wireless telephony, on the other hand, is subject to vigorous competition, as two cellular providers compete with up to six broadband PCS operators in each market. Given this level of competition, it is unreasonable to assume that every conversation that law enforcement officials wish to monitor is being carried over a single provider's network. Yet, by requiring each wireless carrier in a given service area to meet the actual and maximum capacities in their entirety, the FBI implicitly makes this assumption.
While it is unrealistic to expect the FBI to apportion capacity requirements precisely by market share, it is unfair and wasteful of resources to require every carrier to meet the actual and maximum capacity requirements in their entirety. Thus, in areas where there are multiple wireless carriers, the FBI should spread the capacity requirements over all of these carriers. Similarly, because new carriers will have many fewer customers than established carriers, these new entrants should be required to engineer less wiretapping capacity into their networks.
The large size of wireless service areas and the amount of wireless competition points to the fact that wireless capacity requirements should be made more granular, and the number of wireless carriers per county should be factored into these capacity requirements. This could be accomplished if wireless capacities, like wireline capacities, were promulgated on a countywide basis and service area capacities for wireless carriers were calculated as (1/number carriers in the service area) x (the capacity of the most wiretapped county in the service area).
Finally, the FBI admits that historically, there have been a "vastly greater number" of call identifying intercepts (pen register and trap and trace) than Title III (call content) intercepts. However, in setting forth capacity requirements, the FBI did not distinguish between these differing types of intercepts. Because the technologies -- and the cost -- required to support these different types of electronic surveillance varies widely, the FBI should promulgate separate requirements for call content, trap and trace, and pen register intercepts. This distinction will make it significantly easier for carriers to comply with the FBI's requests without engineering more of any single type of capacity into their networks than is necessary.

III. CONCLUSION

Congress should take this opportunity to fine tune CALEA's compliance deadlines and reimbursement programs to make them more reflective of the technological and competitive realities of the telecommunications industry. Such adjustments will provide a competitively neutral, cost effective method by which the FBI, telecommunications carriers, and switch manufacturers can make all of the nation's switches CALEA-compliant. This upgraded infrastructure will, in turn, give law enforcement officials the electronic surveillance capabilities they need to assist them in solving and preventing criminal activity. I thank the Chairman and the Committee for conducting this hearing and look forward to working with the Committee to amend the statute so that it is fair to all players and does not disproportionately burden new entrants.