With the outlook increasingly bleak for a minimum required bid to win the 700 MHz D-block license, Commissioner Michael Copps said Tuesday that, no matter what happens, the FCC will have to make certain that public safety has a national, interoperable broadband network. At our deadline, the only bid for the 10 MHz national license was the $472,000 bid made on day one, which is well short of the minimum $1.33 billion. No company has come forward to replace Frontline Wireless, which announced before the auction began that it would not make the down payment required to participate in the auction.
Federal Universal Service Fund
The FCC's Universal Service Fund (USF) was created by the Telecommunications Act of 1996 to fund programs designed to provide universal telecommunications access to all U.S. citizens. All telecommunications providers are required to contribute a percentage of their end-user revenues to the Fund, which the FCC allocates for four core programs: 1. Connect America Fund, which subsidizes telecom providers for the increased costs of offering services to customers in rural and remote areas 2. Lifeline, which directly subsidizes low-income households to help pay for the cost of phone and internet service 3. Rural Health Care, which subsidizes health care providers to offer broadband telehealth services that can connect rural patients and providers with specialists located farther away 4. E-Rate, which subsidizes rural and low-income schools and libraries for internet and telecommunications costs The Universal Service Administrative Company (USAC) administers the USF on behalf of the FCC, but requires Congressional approval for its actions. Many states also operate their own universal service funds, which operate independently from the federal program.
The FCC may release three universal service items for public comment as soon as today (Friday), indicating it may be ready to start moving on long-awaited Universal Service Fund reform. Commissioners already have voted on the three items, which will have the same comment dates so parties can file one set of comments covering all three if they wish, a source said.
FCC action on early termination fees (ETFs) is expected early in 2008, with the commission expected to refocus at least in part on telecommunications issues following a major fight over media consolidation. The Universal Service Fund, 700 MHz auction, future use of the broadcast white spaces, and 800 MHz rebanding also are expected to get agency attention.
FCC Commissioner Robert McDowell on Thursday questioned the need to vote for a proposal to put an interim cap on Universal Service Fund subsidies for competitive telecom companies. The commission already may have acted by default on the interim measure in setting caps as a condition to its approvals this year of several acquisitions, McDowell told reporters at a press event. “The same goal may already have been accomplished,” he said. It might make more sense to move directly to long- term USF reform, he told reporters. Asked if his comments indicate he would vote no on the interim cap, McDowell said, “the question is have we already voted?”
The FCC should move quickly to approve an interim cap on universal service support to competitive rural carriers, so it can address longer-term reform, TracFone Wireless said in an ex parte letter filed Tuesday at the FCC. The company wants an interim cap on both incumbent and competitive carriers, but “time is of the essence” and a cap on competitive carriers might be approved faster, it said. It’s been seven months since the Federal-State Joint Board on Universal Service recommended capping competitive carriers to halt Universal Service Fund growth, TracFone said. By acting now on that proposal, the FCC could stabilize the fund and advance wider reform, it said. TracFone isn’t a facilities- based provider, so it doesn’t get USF support. But it seeks status as an “eligible telecom provider” so it can get universal service money for providing Lifeline service.
The Federal-State Joint Board on Universal Service issued long-awaited recommendations for reforming the Universal Service Fund late Tuesday that generally followed an outline released in September. The goal of the wide- ranging group of proposals is to reform the high-cost portion of the USF, which subsidizes service in rural areas. The FCC has a year to act on the recommendations.
More than 70 percent of Americans polled back capping the high-cost portion of the Universal Service Fund, and 62 percent oppose using USF subsidies to widen broadband access in rural areas, said Cap the Fund, a group opposing more USF spending. “This program requires us to trust the government not to throw money to services that could be better provided by non-subsidized companies,” said Mac Haddow of the Seniors Coalition, a Cap the Fund member.
The Federal-State Joint Board for Universal Service has agreed to a permanent cap for the high cost part of the Universal Service Fund, most likely at 2007 levels, regulatory and industry sources said Wednesday. The proposal would also create separate funds for wireline, wireless and broadband.
BOSTON -- Prepare for more VoIP regulation as the FCC more often treats VoIP as it does traditional phone service, panelists said Tuesday at the VON conference. The VoIP industry must pay more heed to rules emerging at the federal, state and international levels, they said. “You need good legal counsel to navigate these kinds of things,” said VON Executive Director Jim Kohlenberger.
Seeking Universal Service Fund reform they can live with, telecom companies have been meeting in small groups for months trying to agree on proposals for the Federal-State Joint Board on Universal Service. As the joint board’s self- imposed Nov. 1 deadline nears, meeting participants have become more closed-mouthed about progress.