Small phone companies went to Capitol Hill Tuesday to make the case for legislation including broadband in the universal-service program. Another priority is having this year’s must-pass satellite measure change retransmission- consent rules to give small phone companies easier access to video programming. But lawmakers warned that communications issues face stiff competition for attention in a Congress focused on the economy, health care, energy and a Supreme Court nominee.
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.
Vonage and other traditional VoIP providers don’t have to pay into the Nebraska Universal Service Fund, the 8th U.S. Circuit Court of Appeals said Friday. The St. Louis-based court was upholding a district court decision that Nebraska officials had appealed. As the lower court had, the appeals court accepted Vonage’s claim to be an information service rather than a telecom service (CD Sept 15 p8).
States asked the FCC to promptly adopt a three-year Lifeline and Link-Up pilot program for broadband. In a letter Friday to the FCC commissioners, the National Association of Regulatory Utility Commissioners said the new Universal Service Fund program should be open to all broadband providers. Participating carriers shouldn’t automatically be designated eligible for other USF programs, but the FCC should require any provider receiving USF from another program to participate and contribute to the pilot program, NARUC said. The Federal-State Joint Board on Universal Service should study how the program is carried out and decide whether to expand the pilot into a national program. States should handle the eligibility and verification for low-income participants, it said.
The FCC should allow rate-of-return carriers to allocate federal audit expenses completely to interstate jurisdiction, said small carriers supporting a petition by the National Telecommunications Cooperative Association. The change would make recovery of audit expenses more certain, and save small companies time and money, they said. However, Verizon condemned the petition as having “no basis,” and urged the FCC to do away with jurisdictional separations altogether.
The FCC will likely get lengthy input on a vast array of controversial telecom issues, as it attempts to develop a national broadband plan, said industry officials we polled for reaction Thursday. In a 52-page notice of inquiry released Wednesday (CD April 9 p1), the FCC asks questions on universal service reform, open networks and nondiscrimination, the role of competition, how to define broadband, and several other big issues. The FCC is required under the American Recovery and Reinvestment Act to deliver its national broadband plan to Congress by Feb. 17.
The FCC opened a proceeding to develop a national broadband plan, at its meeting Wednesday. Commissioners unanimously approved a notice of inquiry on the plan, asking a laundry list of questions on how to effectively and efficiently spur broadband deployment and adoption. The FCC must deliver a plan to Congress by Feb. 17, under the American Recovery and Reinvestment Act.
Congress should make cybersecurity, not net neutrality, its main communications priority in the year ahead, James Cicconi, AT&T senior executive vice president, told reporters. He said he expects quick action from the FCC and Congress on a Universal Service Fund overhaul because of growing recognition that the current system is broken. And he endorsed Verizon’s position that the 700 MHz D-block should be given to public-safety agencies for immediate use rather than go through a second auction.
Regulations such as a la carte and net neutrality won’t help consumers and should be opposed, Senate Commerce Committee ranking member Kay Hutchison of Texas told the NCTA convention. “I want to hold back on regulations that are going to stifle innovation,” she said. “I am very skeptical about Congress being able to do it right.” Minority House Whip Eric Cantor of Virginia delivered a similar but broader message at an NCTA lunch: “You don’t need to over-regulate. You need smart regulation.”
There appeared to be little new in the more than 100 comments that flooded into the FCC this week about how to develop a comprehensive broadband strategy for rural parts of the U.S. The recommendations of the commission are expected to be given weight at NTIA and RUS as the agencies develop their respective broadband stimulus programs.
Broadband funds made available through the economic stimulus package and Universal Service Fund monies could play a big role in moving public safety answering points into a new world where they have to take a growing number of VoIP calls and otherwise modernize their systems, Greg Rohde, executive director of the E911 Institute said Wednesday. Rohde spoke at an FCC summit on the future of 911 and the problems local governments face trying to keep up in an IP era.