The FCC proposed an industry USF contribution factor for Q2 of 17.9 percent of end-user interstate and international telecom revenue, said an Office of Managing Director public notice Thursday in docket 96-45. Industry analyst Billy Jack Gregg had predicted the Q2 factor would fall to 17.9 percent from Q1's 18.2 percent (see 1603020012). Total USF program support is projected to be $2.2 billion in Q2, with the high-cost fund projected to require $1.125 billion of that, the PN said. The proposed contribution factor will be deemed approved if the agency doesn't act on it within 14 days, it said.

Work on opening the 5.9 GHz band must continue, said House Communications Subcommittee Vice Chairman Bob Latta, R-Ohio, and FCC Commissioner Mike O’Rielly in a joint blog post for The Hill, written earlier this month and circulated to press by the Commerce Committee Thursday. “The next step in the process is to develop a testing framework, which will ensure that science and engineering determine the best way to allow co-existence in this key spectrum band,” they said. “After some initial reluctance, all interested parties seem to accept that the FCC should move forward with such testing this year. ... We trust that this process can start quickly and focus on appropriately protecting DSRC [dedicated short range communications] technology’s principal functions, not non-safety matters that can be better addressed by other providers or technologies.”

Three low-power TV broadcasters asked the U.S. Court of Appeals for the D.C. Circuit for an emergency stay of the incentive auction, joining two similar requests from several Class A broadcasters, according to court filings. Free Access & Broadcast Telemedia, Word of God Fellowship and Mako Communications petitioned the FCC for such a stay but were rejected by the Media Bureau Thursday, shortly before the motion was filed with the D.C. Circuit. The LPTV broadcasters have ongoing cases in the D.C. Circuit with oral argument scheduled for May 5 (see 1603090078), and want the court to halt the auction until those cases are decided. “A brief postponement to consider challenges to the Commission’s mistreatment of LPTV will not prevent timely completion of the auction. The public interest thus strongly favors a stay,” the motion said. The incentive auction is to begin March 29. “A delay would disserve consumers as well as eligible entities who have made extensive preparations for the auction based on the current schedule, including securing financing and deferring other business plans,” the Media Bureau said in its rejection of the earlier petition for a stay

Granting ILEC objections, the FCC blocked Bruce Kushnick and Neil Stevens from viewing sensitive company data in the special access rulemaking subject to a protective order. AT&T and Verizon objected to the data-access request from Kushnick, New Networks Institute (NNI) executive director. CenturyLink and Verizon objected to the request from Stevens, a tech policy writer at RedState, a political website. In an order listed in Thursday's Daily Digest and posted in docket 05-25, the Wireline Bureau denied Kushnick’s request and said there was some doubt about whether NNI provided certain commercial services and qualified as an outside consultant to a proceeding participant. Citing various NNI descriptions of its activities, the bureau said “the exact nature of NNI’s activities and Mr. Kushnick’s role (whether Mr. Kushnick is acting as a representative of NNI or is he now acting in his own capacity) is unclear.” Kushnick’s “lack of previous involvement in this proceeding along with the very general nature of his filings” raise doubt about whether he would use the data access to file comments on the specific questions raised in the proceeding, said the bureau. The FCC noted AT&T said Kushnick's main occupation appeared to be writing blog posts and books. The "lack of transparency in who is behind Mr. Kushnick's organizations" combined with his views that special access information should be made public creates added risk he would disclose commercially sensitive data, AT&T said. The FCC noted Kushnick responded that NNI intended to participate meaningfully in the proceeding. But NNI was prevented from doing so because the FCC had allowed the telcos to "run out the clock in the comment cycle, he said in a Feb. 17 filing complaining about the lack of agency action on his request. NNI had answered the telcos' “specious claims” and should be given access to the data because it “has uncovered a massive financial shell game, that was created, in large part, by the FCC, which we have dubbed the ‘Big Freeze’ -- and it directly relates to ALL special access issues in America; the newly collected data should corroborate our filings,” he said. Kushnick told us Thursday he plans to appeal the decision to the full commission. "We have a right to be heard," he said. "Our reports show the FCC has not audited the telco books for 15 years. … Our belief is the phone companies have been able to manipulate the books, and the FCC has helped them." That has led to "massive cross-subsidies," local phone rate increases and discontinuance of network services, he said. In denying Stevens access, the bureau said that “he does not claim to represent or be employed by any other entity or party to these proceedings” and thus didn’t qualify as an outside consultant or counsel to a participant.

Multichannel video programming distributors began lobbying the FCC heavily on the broadcaster practice of trying to include stations to be named later in retransmission consent talks. The American Cable Association and American TV Alliance cited the issue at meetings with FCC staff, said ex parte filings (see here and here) Tuesday in docket 15-216. ACA said representatives of Atlantic Broadband, Cass Cable, Frankfort Plant Board, Liberty Puerto Rico and Shentel told Media Bureau staff that large broadcast station groups in particular "regularly engage" in bad-faith bargaining practices in retrans consent talks. ACA's meeting cited stations "allowing their affiliated networks to interfere with their right to grant out-of-market retransmission consent to cable operators" and broadcaster demands for carriage of prospective programming. ATVA also brought up prospective programming -- trying to require MVPDs to carry at set terms and rates networks to be named later -- in its meeting with Media Bureau and Office of General Counsel staff. At that meeting, according to ATVA, were representatives of ACA, AT&T, Dish Network, Time Warner Cable and USTelecom. ATVA said it discussed different types of forced bundling, ceding of negotiation rights and after-acquired station licenses. ATVA said it also repeated its arguments the FCC has legal authority to adopt its proposals. NAB didn't comment Wednesday.

T-Mobile's repacking study has “significant flaws,” NAB told staff from the offices of Commissioners Mike O'Rielly, Ajit Pai and Jessica Rosenworcel in meetings Monday, said an ex parte filing in docket 12-268. T-Mobile's “serious underestimation of the time required to repack stations” is partially based on a misunderstanding of the flexibility of broadcast antennas, NAB said. Even though the antennas can be adjusted to receive a range of frequencies, they generally can't replicate a station's coverage on a different channel, and would likely require adjustments and a new transmitter, NAB said: T-Mobile also misjudged the number of tower crews, including crews that don't currently perform broadcast work. “Many of NAB’s members have never even heard of a number of the tower crews T-Mobile claims are qualified to perform broadcast work,” NAB said. “These are not experienced, trusted partners, and broadcasters will not put their most valuable asset in the hands of unproven vendors.” T-Mobile's study (see 160304005) is “outcome-driven, oversimplified and misleading,” NAB said. “Disappointingly, Commission staff meanwhile appears to be focused only on auction expediency.”

FCC reform of the USF high-cost program for rate-of-return carriers was based on an unusual level of collaboration (see 1602190056), FCC Commissioner Mike O’Rielly said at a Faegre Baker lunch Tuesday. “At my request, a number of Commissioners worked extensively with the requisite trade associations in order to fully understand their concerns and the impact of any changes,” O’Rielly said, according to his written remarks posted by the agency Wednesday. The event was closed to the news media. “I also traveled to a number of places around the country to hear firsthand from carriers," said O'Rielly. "After almost a year of discussions, I believe we have a solid framework that provides regulatory certainty for rate-of-return carriers for years to come.” Compared with some of the other areas tackled by the agency, rate-of-return reform was “one of the more inclusive procedural efforts that I have been part of at the Commission,” he said. The order addresses “antiquated rules” to allow reimbursement for stand-alone broadband, he said. The order also imposes build-out requirements and other strictures to ensure money is “wisely and efficiently spent, while providing transitions where appropriate,” he said. O’Rielly had less good to say about two items expected to get a vote at the agency’s March 31 open meeting. Lifeline program changes (see 1603080024) must include controls on the size of the program, O’Rielly said. “I have made clear that I’m willing to support expanding the program to cover broadband but, in return, the Commission must adopt a reasonable overall budget at the same time,” he said. “That is non-negotiable.” O’Rielly also raised concerns about an expected NPRM on privacy rules for ISPs (see 1603080067). The net neutrality order is still pending before the courts, he said, so FCC authority to act is in question. “The Commission doesn’t understand how its new burdens will impose unnecessary and costly compliance on broadband providers,” he said. “Who does the Commission think is going to pay for this? Additionally, by all measures the Commission is ill-prepared to address the complexity of privacy matters, lacking the history and necessary expertise.”

A proposal by ISPs on privacy rules included groups representing nearly all ISPs (see 1603010069) except wireless ISPs, said Robert Quinn, AT&T senior vice president-federal, in a blog post Wednesday. FTC oversight has worked well, Quinn said. “All major ISPs have enacted privacy policies which explain to consumers the information that ISPs collect and how that data is used,” he said. “At AT&T, we’ve continued to simplify our policy, including several years ago when we went to a single comprehensive privacy policy that describes plainly and simply the information we collect, how we collect it and how we use it.” Quinn said he was AT&T chief privacy officer for several years and can say firsthand “we take customer privacy and how we communicate our polices to our customers seriously.” But some groups are pushing for much stricter rules than ISPs have faced in the past (see 1603070049), Quinn said. “To get there, those groups have characterized ISPs as ‘gatekeepers,’ asserted that ISPs (as opposed to companies like Google) are the real leaders of targeted advertising and, finally, argued that the Federal Trade Commission is, in essence, incompetent at policing privacy given the tools they have available.” Those arguments aren't supported by the facts, he said, though he warned the FCC may be listening. “Time and time again, the FCC appears to want to place its thumb on the scale in favor of Internet companies and against the companies that invest in broadband infrastructure in this country,” he wrote. “Last year, it was the Title II proceeding. Last month, we were talking about set-top boxes, this month it’s privacy, next month it could be special access.” The FCC did not comment. "I’ve characterized ISPs as ‘gatekeepers’ because that is what they are,” said John Simpson, Consumer Watchdog privacy project director, responding to Quinn. “Edge providers like Google and Facebook do pose serious privacy concerns, but that is no justification for not dealing with the privacy issues raised by ISPs and their unique position. That is what the FCC is legally bound to do now that broadband providers are classified as common carriers.” The FTC has tried to protect consumers' privacy, “but because it doesn’t have rulemaking authority in this area and can only move against ‘unfair and deceptive’ acts, its powers are limited,” Simpson said. “The phone and cable ISP industry is totally disingenuous claiming that the use of privacy policies is an effective way to protect consumers,” said Center for Digital Democracy Executive Director Jeffrey Chester. “These companies are engaged in significant cross device tracking and targeting using their advantage over subscriber information. They are expanding their work with data brokers, acquiring powerful consumer data assets, and are engaged in practices that threaten the privacy of their customers. The FCC has to step in before these broadband giants further invade our privacy.”

AT&T said it and Univision reached a brief cease-fire of their retransmission consent dispute, which had resulted in the blackout of the broadcaster on the telco's U-Verse pay-TV service and led to a war of words (see 1603070061 and 1603040063). "We appreciate Univision agreeing to our request earlier today to unblock their channels temporarily during the upcoming Democratic Presidential Debate," AT&T said Tuesday. "We continue working toward an agreement with Univision.” With the debate to be co-hosted by Univision Wednesday, National Hispanic Media Coalition CEO Alex Nogales said last week that the blackout was "a grave injustice to voters looking to be informed." The debate, also sponsored by The Washington Post, "will be available to U-verse customers as part of our commitment to inform and empower our community, especially in this crucial election year," a Univision spokeswoman emailed us Tuesday. Meanwhile, Rep. Tony Cardenas, D-Calif., said he worries about the ongoing effects of the AT&T/Univision dispute. “I strongly urge both parties of the negotiation to quickly and responsibly resolve this situation and come to an agreement in order to ensure the Latino community can continue accessing the content they choose at this pivotal time for our country,” said Cardenas, a Commerce Committee member, in a statement Tuesday. “This situation highlights how important it is for the individuals and companies that control our media landscape to maintain a commitment to civic responsibility, particularly to the Latino community. … The timely resolution of this dispute is an issue of public interest.”

Google met with all five FCC commissioners, urging them to act on rules “to empower innovative uses in the high-frequency bands above 24 GHz” as part of its spectrum frontiers rulemaking. Google is particularly concerned about unlicensed use of the 57-71 GHz band, the company said. “We reiterated our arguments that, given present characteristics of useful field disturbance sensors, heavy constraints on their use at 57-64 GHz are no longer appropriate.” Google made the filing in docket 14-177 on the meetings that included Chairman Tom Wheeler.