Alltel Says Large Carriers Not Serving Rural America

Many reply comments focus on a dispute between incumbent local exchange carriers (ILECs) and wireless carriers over funding for competitive eligible telecommunications carriers (CETCs). The Board sought views on proposals for long-term change such as using reverse auctions to assign support. The Joint Board hopes to make a recommendation in November.

Alltel submitted maps based on data from American Roamer, using proprietary information available to carriers, showing actual coverage based on engineering studies versus Verizon marketing maps submitted to the FCC, Alltel said. The Alltel maps show that in Montana and South Dakota, typical of large, rural states, coverage by major carriers shrinks in line with distance from highways and larger cities. Alltel’s coverage extends across far more of the state, according to the maps.

“The purpose of the program is not to prop up revenues for any particular group of carriers,” Alltel said. “Rather the purpose is to ensure that consumers in high-cost, rural and insular areas have access to affordable, high-quality service options, including broadband and other advanced services… The ILECs’ claims that CETCs somehow reap a ‘windfall’ from high-cost support are long on rhetoric, but short on substance because they are simply not true… Alltel, for its part, has demonstrated that it has deployed network service areas where it has been designated as an ETC.”

Verizon took aim at Alltel, asserting that in 187 of 367 study areas where Alltel gets high-cost support, service is available from other carriers not getting such support. “The vast majority of people in areas served by Alltel could get wireless service from unsubsidized carriers,” Verizon said. Verizon was joined by Verizon Wireless in its comments.

AT&T further fleshed out a June proposal for a pilot program paying for broadband deployment in rural areas with “a specified amount of funding, for example, $1 billion per year” (CD June 4 p4). Among new details, AT&T said broadband program applications would be submitted to “appropriate state commissions for their review and determination of whether the areas contained in the applications are underserved and qualify for funding based on objective.” Criteria the state commission should have to include the applicant’s financial qualifications, whether it has build out plan able to be acted on in under two years and the extent of its commitment to serve all households, AT&T said.

A reverse auction must not be “an end in and of itself,” AT&T said, calling reverse auction proposals by Verizon and CTIA are flawed and deserving of rejection. Verizon’s auction proposal “would perpetuate the flawed practice of directing support to multiple, redundant networks by awarding support to one auction winner per network platform, increasing the cost of universal service without achieving measurable progress toward achieving federal universal service objectives,” AT&T said. “Similarly, CTIA’s ‘winner takes more’ auction proposal would subsidize redundant networks and providers, unnecessarily increasing the size of the fund without promoting achievement of universal service objectives.”

Verizon told the joint board its reverse auction proposal has a unique capacity to “stabilize the fund permanently” and “rationalize high cost universal service support.” CTIA said its “winner takes more” auction proposal is the only one that is consistent with the Telecom Act. “By contrast, a winner-takes-all reverse auction and/or auctions that segregate ‘wireline’ and ‘wireless’ carriers would violate important statutory goals, including the promotion of competitive markets and the achievement of core universal service principles,” CTIA said.

The Joint Board should take care in studying comments, said the National Telecommunications Cooperative Association, noting a “feeding frenzy” of commenters “asking the Federal- State Joint Board on Universal Service to consider more precise targeting of high cost support, eliminating rural/nonrural ILEC carrier distinctions, creating pilot programs for supporting broadband and/or mobility, and supporting competition through the use of the high-cost universal service fund,” the group said. “NTCA urges the Joint Board to resist these temptations to unnecessarily increase the size of the high-cost universal service fund and further risk its sustainability.”