A move to give states USF money in line with what they pay in to the fund is understandable, but has some troubling implications, said Aspen Institute Fellow Blair Levin Monday in remarks to the Alaska Telephone Association. Levin reacted to legislation introduced in December by Sen. Kelly Ayotte, R-N.H., which would ensure rural states get back 75 cents of every dollar they pay into the fund (http://1.usa.gov/M6dTts). “The troubling part is that if Senators look at the issue through the lens of their own state and only try to solve for the question of how to get their state more money or find a formula that works best for their own state, we will never improve Universal Service,” Levin said in prepared remarks. “Indeed, it is unlikely that Universal Service will survive, unless, like mythical Lake Woebegone, we can create a situation in which all states are above average in obtaining USF support.” The House Republican leadership is proposing to rewrite the Telecom Act, noted Levin, a Democrat and primary author of the FCC’s 2010 National Broadband Plan: “If the Republicans take the Senate, delivering a bill whose purpose will be dramatic deregulation is not unthinkable.”

Municipal broadband systems typically charge consumers substantially more than their private-sector rivals for similar triple-play offerings, the Phoenix Center found in a study released Monday (http://bit.ly/1mPncJN). “The evidence suggests that the government’s provision of broadband services does not lead to lower prices,” said Phoenix Center Chief Economist George Ford, in a statement. “While municipal entry may serve valid purposes, lower prices do not appear to be one of them.” The competitive price for a standard triple-play service is about $100 in the U.S., and “the expansion of municipal provision of broadband service won’t alone alter that reality,” the paper said. It’s also not possible to conclude that a lower price implies better consumer welfare, the paper said. The study said it sought to “correct the errors” in a Consumer Federation of America report urging governments to “intervene to protect the public” by building more municipal networks to compete with private-sector providers.

Communications providers will be allowed to disclose the “number of national security orders and requests issued to communications providers, and the number of customer accounts targeted under those orders and requests including the underlying legal authorities,” said Attorney General Eric Holder and Director of National Intelligence James Clapper in a joint statement Monday (http://1.usa.gov/1et64oR). They said the move arose from President Obama’s speech on surveillance, in which he outlined several proposed changes to the government’s information collection practices (CD Jan 21 p1). After consulting with other agencies, Clapper’s office “determined that the public interest in disclosing this information now outweighs the national security concerns that required its classification,” the statement said. “Permitting disclosure of this aggregate data resolves an important area of concern to communications providers and the public.” The statement also indicated “additional steps must be taken” in the coming weeks “to fully implement the reforms directed by the President."

The framework for moving forward with IP transition trials will be based on the four principles laid out last spring by FCC Commissioner Jessica Rosenworcel, industry and agency officials told us. The principles include protecting public safety, preserving universal service, keeping competitive markets functioning and protecting consumers. An order has been circulated that would set procedures for proposing and evaluating IP transition trials, and is likely to be supported by all the commissioners (CD Jan 10 p1). The commission will also consider an NPRM and NOI at the FCC meeting, according to a notice released Thursday (http://fcc.us/KQ20qQ). In addition to setting the framework for the IP transition and related trials, the order considers ways to encourage broadband buildout in rural areas, industry officials said. In meetings last week, CenturyLink officials described their plans for “proposed transition to new third party points of connection, transition from existing TDM hub and spoke architecture, and a model for a packet switched voice network with state level connectivity” (http://bit.ly/1hsTxFa). The Communications Workers of America spoke Wednesday with the FCC’s acting General Counsel Jonathan Sallet to emphasize “the critical importance of data collection regarding the employment impact of the IP Transition Trials,” an ex parte filing said (http://bit.ly/1hsU3mK). Such data would “help ensure that employees can transition to the work on IP networks, and keep quality telecom jobs in the United States,” CWA said.

President Barack Obama’s big data study will conclude with a report “that anticipates future technological trends and frames the key questions that the collection, availability, and use of ‘big data’ raise -- both for our government, and the nation as a whole,” said Counselor to the President John Podesta in a Thursday blog post (http://1.usa.gov/1mMuWiG). In remarks on proposed changes to the government’s surveillance programs (CD Jan 21 p1), Obama revealed a “comprehensive review” of how data collection and data use is affecting society, with Podesta heading the effort. The final report “will help identify technological changes to watch, whether those technological changes are addressed by the U.S.’s current policy framework and highlight where further government action, funding, research and consideration may be required,” Podesta said. The President’s Council of Advisors on Science and Technology will also participate, he said. PCAST “will conduct a study to explore in-depth the technological dimensions of the intersection of big data and privacy,” Podesta said. The review will also include consultations with “industry, civil liberties groups, technologists, privacy experts, international partners and other national and local government officials,” as well as think tanks and academic institutions, he said. Podesta said he expects the working group to complete most of its work over the next 90 days, but “we don’t expect to answer all these questions, or produce a comprehensive new policy” in that timeframe.

In high-technology mergers, the Justice Department now views protecting “innovation” as a key consideration, Deputy Assistant Attorney General Renata Hesse said in remarks to the Conference on Competition and IP Policy in High-Technology Industries at Stanford University. “While competitive prices are -- and will remain -- a key objective, the division fully appreciates the importance of innovation,” Hesse said, according to prepared remarks (http://1.usa.gov/1aN1vIf). “Innovation can dramatically improve consumer welfare by motivating the introduction of extraordinary new products, including some that meet demands that consumers didn’t even anticipate.” Hesse said DOJ looks closely at “evidence that shows that a firm being acquired has been a particularly innovative or disruptive competitor,” in considering a merger. Hesse cited DOJ’s 2011 decision to block AT&T’s purchase of T-Mobile. DOJ said at the time: “AT&T’s acquisition of T-Mobile would eliminate a company that has been a disruptive force through low pricing and innovation."

The FCC should override objections from Globalstar and allow the use of the 5.1 GHz U-NII-1 band for Wi-Fi, NCTA said in a report filed at the FCC Wednesday. NCTA said mobile satellite services operators were allowed to use this band for feeder links starting in the 1990s, but now it’s little used. “Today Globalstar is the only MSS operator using the band,” NCTA said. “Every other company has gone bankrupt or uses different frequencies. And rather than serving the millions of customers that the FCC predicted many years ago, Globalstar uses the vast 100 MHz U-NII-1 band -- over 1.5x more spectrum than the entire core 2.4 GHz Wi-Fi band -- for four U.S. feeder link stations serving fewer than 85,000 duplex customers worldwide, only a subset of which are U.S.-based.” As long as incumbents are protected, use of the band for Wi-Fi would have many benefits, NCTA said: “It would support expansion of consumer broadband, advance the Commission’s connected schools program, empower additional mobile health systems, and allow technological innovation harnessing the new Gigabit Wi-Fi standard.” Globalstar fired back. “Globalstar appreciates NCTA’s commitment to the ‘fundamental principle that unlicensed devices must not cause harmful interference to Globalstar,'” Globalstar General Counsel Barbee Ponder said in an email. “Unfortunately, it is impossible for NCTA or the FCC to ensure that Globalstar’s mobile satellite services will not suffer harmful interference if the unlimited, potentially ubiquitous outdoor deployment of U-NII-1 access points is permitted. In this scenario, the number of outdoor devices ultimately deployed by ALL providers of Wi-Fi services is unknown and could even far exceed current projections. In its most recent study, NCTA ignores this reality and apparently presumes that cable companies will have a de facto monopoly on the use of free unlicensed spectrum in the U-NII-1 band.”

The “common carrier” prohibition discussed by the U.S. Court of Appeals for the D.C. Circuit in its net neutrality decision “raises significant concerns” about the IP transition, Public Knowledge told FCC acting General Counsel Jonathan Sallet Monday, an ex parte filing said (http://bit.ly/LHojj9). “With regard to Verizon’s pending request to discontinue service on the New Jersey Barrier Island, the decision raises significant concern because grant of the request, without finding Voice Link to be a Title II service, would leave residents of Mantoloking without a guarantee of basic voice service,” PK said. The FCC would have questionable ability to enforce a voluntary decision by Verizon to provide Voice Link on terms similar to those offered for their wireline service, PK said: As the court explained, “the Commission may not impose on a Title I service provider a Title II common carriage obligation.” Without classifying Voice Link as a Title II service, “it is difficult to see how enforcement of a core common carrier obligation (obligation to serve the public indiscriminately) could be enforced,” PK said. The commission may also lack authority to resolve disputes on “interconnection, intercarrier compensation, rural call completion or other areas touching on ‘core’ common carrier obligations,” PK said. “At best, the FCC can impose a duty to negotiate in good faith."

President Barack Obama’s announcement Friday that a panel will review “big data and privacy” (CD Jan 21 p1) disappointed both privacy advocates and industry associations, albeit for different reasons, according to statements. On Friday, Obama said a group of government officials -- led by Counselor to the President John Podesta -- “will reach out to privacy experts, technologists and business leaders, and look [at] how the challenges inherent in big data are being confronted by both the public and private sectors; whether we can forge international norms on how to manage this data; and how we can continue to promote the free flow of information in ways that are consistent with both privacy and security.” The Direct Marketing Association said in a Friday statement it’s “disappointed to see the responsible use of consumer data for marketing purposes conflated with ‘government surveillance.'” Data-driven marketing -- which includes data brokers (CD Dec 20 p6) -- is not related to “issues around government surveillance,” the association said, pointing to its “Guidelines for Ethical Business Practice” (http://bit.ly/1juOeqi), which “ensure that consumers have robust transparency and meaningful choices about how data is used for marketing purposes,” said the statement. Software and Information Industry Association President Ken Wasch called Obama’s remarks “thoughtful,” but said in a statement, “we are disappointed he did not go further in the area of increased transparency.” Data-driven “innovation is an economic driver for the U.S. and global economies, providing enormous benefits for individuals, businesses and society,” Wasch said. Jeff Chester, executive director for digital privacy advocate Center for Digital Democracy, said the establishment of the big data and privacy research group does not go far enough. Obama’s big data review group “isn’t the same as real safeguards limiting the collection and use of our commercial data -- and which can be accessed by the NSA and others,” he said in a statement. “Meanwhile, companies such as Google and Facebook are getting a free pass to our data."

The FCC said it can’t determine whether it will act on requests by LightSquared about the company’s spectrum. The FCC “is not in a position to confirm whether it will [be] able to complete the work required to act on each of the conditions specified in the FCC Exit Condition” before Dec. 31, it said in a statement filed in the company’s bankruptcy proceeding (http://bit.ly/1moYuzN). LightSquared’s preferred plan out of bankruptcy involves $4 billion in financing backed by investors, including Fortress Investment Group and JPMorgan Chase (CD Dec 31 p1). “Effectiveness of the plan is conditioned on the FCC’s approval of LightSquared’s license modification applications and grant of additional relief,” on or before Dec. 31, LightSquared said in a revised second amended joint plan in the bankruptcy court docket. Spectrum management issues will need to be resolved with the federal stakeholders pursuant to a 2003 memorandum of understanding between the FCC and NTIA, the FCC filing said. The consultation process is ongoing and the FCC will give due consideration to the NTIA’s recommendations before ruling on debtors’ license modification proposals to use this spectrum, it said, referring to LightSquared’s condition to hold terrestrial-based spectrum rights in 20 MHz of L-band uplink spectrum. “Consequently, the timing of any FCC action is not solely within the FCC’s control.” The commission said it will need to do a rulemaking on approval to use the 10 MHz of downlink spectrum at 1670-1675 and 1675-1680. “At this time, it is not possible to provide any assurances that the processes outlined herein will be completed by December 31, 2014.” The FCC’s document is routine and typically seen in bankruptcy proceedings, and usually includes FCC conditions, said a satellite industry professional who’s closely monitoring the process. That the FCC would reference the end of the year gives LightSquared a bit of runway to work through the regulatory hurdles, the professional said. The filing “potentially throws the LightSquared bankruptcy into chaos,” and could leave Judge Shelley Chapman of U.S. Bankruptcy Court in New York in “a near impossible position,” said independent analyst Tim Farrar. Commitments on LightSquared’s exit financing were due Friday, “and the FCC’s intervention could make the status of that financing even more uncertain,” he said in a blog post (http://bit.ly/1dMPULZ). Given the time it will take the FCC to get through the NPRM process, “we don’t see how Fortress goes through with its latest proposal,” said Wells Fargo analyst Marci Ryvicker. There’s no guarantee that the FCC will agree to the other five conditions, she said in a research note. Dish Network Chairman Charlie Ergen will likely end up with the LightSquared assets, she said. Regarding the conditions that aren’t addressed, the statement’s silence on them “should not be construed as an indication that the FCC could or would issue an approval required under the FCC Exit Condition, or that the FCC would issue a required approval” by the end of the year, the FCC filing said.