Keep interconnected VoIP eligible for Universal Service Fund E-Rate schools and libraries support, a cross section of industry and E-Rate applicants said in Thursday comments on a rulemaking. But commenters differed on funding year 2009 eligibility for filtering software, dark fiber and other new services.
Embarq filed a plan to more narrowly target Universal Service Fund support. Embarq urged the FCC to target USF support to price-cap study areas on a wire-center basis, rather than the current implicit-support method that uses study area averaging. The carrier previewed the plan earlier this month with the Wireline Bureau (CD Sept 2 p6). The Thursday filing, which included a letter to commissioners and a 47-page white paper, varies slightly in specifics, but mostly fleshes out what it pitched then, an Embarq spokesman said.
Recent talk of overhauling intercarrier compensation and USF has sparked fevered telecom industry debate. On a Thursday FCBA panel, officials and lawyers representing AT&T, Sprint Nextel, Windstream, OPASTCO and competitive local exchange carriers reviewed recent proposals by Verizon and others advocating a uniform $0.0007 terminating access rate for all traffic. USF contribution was among few items on which they appeared to agree.
The FCC wants comment on two carriers’ requests to review Universal Service Administrative Co. decisions, the agency said in public notices Wednesday. CTE Telecom disputes a USAC ruling saying CTE inaccurately designated certain revenue as enhanced services, rather than as DSL services. NextGen Telephone disputes a USAC ruling saying NextGen should report subscriber line charges as interstate revenue subject to federal Universal Service Fund contribution. NextGen said the charge should be allocated by usage, because the carrier levies the charge on all customers, including ones without interstate service. Comments on each are due Oct. 17, and replies Nov. 3.
Moving to numbers-based Universal Service Fund contribution is a “reasonable approach,” but the change by itself isn’t sustainable long term, said the Organization for the Promotion and Advancement of Small Telecommunications Companies. To be effective, a revamp must increase the contribution base, OPASTCO said. The FCC should require all facilities-based broadband Internet providers, regardless of platform, to “contribute equitably to the federal USF,” it said.
The Iowa Utilities Board called for comments by Oct. 13 on whether it should implement a state universal service fund. The IUB addressed the issue in 2003 but chose not to move ahead. Now, the board said it’s time to take another look at the question and see if changed industry conditions now call for a state USF. The IUB said some local exchange providers have advocated a new look at the issue of state universal service subsidies because they believe recent and anticipated access charge reductions may impair their ability to provide local service at reasonable rates. The IUB said it appears access charges have been providing implicit subsidies for local rates, and that moving to explicit subsidies might offer economic and policy advantages. The IUB (Case NOI-08-2) asked commenting parties whether a state USF is needed, what services, providers or technologies should be subsidized, and what the goals of a state USF should be. The IUB also asked for comment on how contributions and subsidy levels should be set, whether there should be a limit on the number of subsidized carriers in a market, and whether a third party should be retained to administer the fund. Further procedural steps will be set after the comments are reviewed.
The FCC wants comment on how to strengthen Universal Service Fund management, administration and oversight, it said in a notice of inquiry. The FCC also seeks input on how to “define more clearly the goals of the USF,” new ways to gauge performance and whether to write new rules on document retention and enforcement. The notice, adopted Aug. 15 and released Friday, was to be voted on at the Aug. 22 FCC meeting but commissioners voted early, 5- 0. The agency hopes to build on results of a 2007 Inspector General audit, it said. The FCC already has moved to strengthen oversight, but is “concerned about the error rates the Inspector General identified,” it said. Among other goals, the FCC wants to prevent improper USF payments and fight waste, fraud and abuse, the agency said. “To ensure continued success, we must remain committed to monitoring, auditing, reviewing and reinforcing this program,” Commissioner Jonathan Adelstein said. “Part of that process is being responsive to criticisms of the Commission’s management.” The NOI is “quite timely, if not overdue,” said Commissioner Michael Copps.
The FCC seems to be setting up intercarrier compensation and Universal Service Fund overhaul proposals for its Nov. 4 meeting. Whether Chairman Kevin Martin will propose a complete overhaul there was still fluid, sources said. A court order gave the commission until Nov. 5 to explain the statutory basis for its ISP-bound traffic compensation regime. Industry officials said the Wireline Bureau is soliciting comments on several comprehensive proposals.
Carriers must contribute 11.4 percent of their long distance revenue to the Universal Service Fund in Q4 2008, the FCC said Friday. That was same as the Q3 levy. To set the carrier “contribution factor,” the agency divides projected carrier revenue by expected USF subsidies for a given quarter. Of an estimated $1.97 billion in Q4 subsidies, about $1.18 billion is for the rural high-cost program, $528.56 million for the E-rate program, $208.04 million for low-income support and $49.87 million for the rural health-care program.
SAN FRANCISCO -- State policymakers mainly turned a cold shoulder to industry pleas for tax breaks in a discussion at last week’s CTIA conference. The wireless industry can keep saying “till you're blue in the face” that mobile service is overtaxed nationwide, but policymakers won’t budge, said Daryl Bassett, a Republican member of the Arkansas Public Service Commission.