O'Reilly Warns Against Picking Winners, Losers in CAF Reverse Auction
FCC Commissioner Mike O’Rielly said “a funny thing is happening on the way to enacting a reverse auction for a key portion of the high-cost Connect America Fund (CAF).” Some people -- he didn't say who -- want commission staff…
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“to select winners and losers with an inappropriate bias against certain technologies,” instead of devising a “program based on competitive forces and free-market principles,” O’Rielly wrote in a Thursday blog post. “Such manipulation would be the surest way to produce greater inefficiency, overpay for service and leave many consumers unserved. Further, this would set bad precedent and undermine future Commission universal service efforts. Accordingly, I suggest that we reject this approach, focus on the sound, broad principles that everyone should support, and then turn to implementing the details.” O'Rielly listed five principles for the auction to follow: "maximize coverage," "no categories," "open to all technologies," "multi-round auction" and "no overbuilding." O'Rielly recently warned against designing the auction -- for CAF Phase II areas where price-cap incumbent telcos didn't accept model-based support -- in a way that would contain a bias for fiber over wireless (see 1511170063). A draft order was circulated among commissioners in late September (see 1509250057).