A rural telecom company proposed a plan it said would let the FCC...
A rural telecom company proposed a plan it said would let the FCC control Universal Service Fund growth without “drastic and untested reverse auctions.” In a letter to the agency, Panhandle Telecommunications Systems urged the FCC to continue letting…
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multiple wireless competitors operate in rural areas but give them an “economic incentive” to use other wireless carriers’ networks where it isn’t economically feasible to build more facilities, PTS said. Wireless rivals’ universal service support should be based on their own costs, not the “identical support” process, which bases competitors’ support on incumbent local exchange carrier costs, PTS said. Under the plan wireless competitors would have to share their networks with other wireless carriers licensed in the same area and charge less than the standard roaming rate. This would discourage building more networks and lessen the drain on the USF, which finances those networks, the plan said. The proposal is by the competitive subsidiary of Panhandle Telephone Cooperative, making it more neutral than some, PTS said. Panhandle Telephone Cooperative is an incumbent local exchange carrier in Oklahoma, Texas and New Mexico. Its PTS subsidiary provides competitive wireless service in Oklahoma and Kansas and competitive local exchange carrier service in Texas. The reduced roaming rate would be based on “the national average cost to produce a wireless minute,” also called “local wholesale rate,” PTS said. This rate would be used to set USF support for wireless competitors, PTS said. A formula would be devised to let wireless competitors “calculate their own costs based on a national average cost without resorting to the highly- regulated and burdensome cost accounting methods currently required of some ILECs,” PTS said. The proposal includes a procedure for paying competitive wireline companies. They would have to do cost studies like those incumbent rate-of- return LECs do. “Since many rural CLECs are accustomed to preparing cost studies in their affiliated ILEC areas, they should be willing to prepare a similar study for their CLEC areas as well,” the letter said. The plan would cap USF support for a wireline CLEC at 1.5 times the support per line in the state where the company operates.