The FCC Fri. sent a letter to Verizon asking why it hit customers with a new DSL fee just as a federal fee of about the same amount lapsed. However, the agency decided not to question BellSouth, which said Fri. afternoon it was killing plans for such a fee. FCC Martin reportedly was upset by the companies plans for replacement fees. “We generally prefer regulation be done by the marketplace but we will act to insure consumers’ interests are protected,” an FCC official said.
ASPEN, Colo. -- Verizon won’t seek a federal franchise bill next Congress if the telecom bill (HR-5252) fails to pass this year, Verizon Exec. Vp Tom Tauke said Tues. at the annual Progress & Freedom Foundation conference here: “We aren’t going to be starting out from the same place -- the appeal of video is going to be less.” Verizon’s state-level success with franchise laws significantly weakens demand for federal reform, Tauke said.
“The need for the $7 billion Universal Service Fund (USF) is less now than it was in 1998 when it was $3 billion,” said Thomas Hazlett Fri. The former FCC chief economist, a professor at George Mason U., answered questions about his views on the telecom industry on a call-in interview on C-SPAN. Hazlett echoed many of the conclusions in his study (CD July 20 p7) ‘Universal Service Telephone Subsidies: What does $7 billion buy?’ Telephone users are paying taxes to fund subsidies that go to inefficient rural telcos, Hazlett said. “These small rural companies,” who are given billions in USF subsidies, “are charging their customers the same rates, and occasionally more for their subsidized services,” said Hazlett. As a result many rural consumers are ditching land-lines for less expensive wireless services, he said.
Deregulating the Bells broadband transmission services would hurt rural telephone companies that rely on them for Internet backbone service, the National Telecom Co-op Assn., told the FCC in comments filed Thurs. The Bells are the only Internet backbone providers available to rural telephone companies in many areas, NTCA said: “NTCA is concerned for its members who will rely on BellSouth and Qwest for access to the IP backbone.”
Resurrecting an idea first aired several years ago, the Federal-State Joint Board asked for comments on using “reverse auctions” to distribute universal service funds in rural and other high-cost areas. The idea gained currency earlier this year when FCC Chmn. Martin voiced interest in letting phone companies bid to provide universal service in rural areas (CD March 30 p6). The term “reverse auction” sometimes is used to indicate that low bidders, not high bidders, get contracts.
The FCC should keep in mind that wireless carriers are following a LEC model in how they perform traffic studies sometimes submitted as an alternative to paying the safe harbor total to support the USF program, CTIA told the agency. In comments on a notice of proposed rulemaking on USF rules, CTIA said the FCC shouldn’t impose more restrictive rules for traffic studies, but instead allow carriers to rely on estimates based on “originating/terminating cell sites, NPA-NXX, a combination of these methods, or any other similarly reliable data” in calculating the percentage of calls on their systems that are interstate and thus subject to USF payments. “Wireless carriers… have always struggled with the segregation of revenues and traffic because they provide a service that is inherently mobile.” The association said that in the current world, where the actual location of calls is sometimes not clear, LECs also have difficulty tracking traffic on their systems. “Even some incumbent LECs, who once were able to use originating and terminating area codes to determine the jurisdiction of calls, no longer can segregate traffic precisely, since calls to or from mobile or VoIP numbers cannot necessarily be jurisdictionally classified with precision,” CTIA said. A carrier source said CTIA’s message is that “all flavors of telecom carriers need an ability to make some assumptions here and can’t be held to a 100% standard.”
USTelecom’s lobbying bill was 8 times higher in 2005 than in 2002, thanks to telecom reform bills, filings with the Secretary of the Senate showed. NCTA lobbying outlays rose 68% in the same period, a notable gain for a sector typically not maintaining a strong presence on Capitol Hill because it’s lightly regulated. The lobbying disclosure reports, which must be filed twice a year, list contacts with House and Senate members and federal agencies.
More interim changes to the Universal Service Fund (USF) contributions system simply will delay reform, VoIP providers and others told the FCC in comments filed Wed. The FCC in a June order making interim fixes (CD June 22 p1), asked if more temporary changes were due. Commenters told the FCC not to waste time on interim fixes but to replace the revenue- based system.
Broadband Internet access providers “over all platforms” should contribute to the Universal Service Fund, 3 groups representing rural telecom companies told the FCC in an Aug. 4 ex parte. A recent FCC vote to raise the safe harbor for wireless USF contributions and to add VoIP providers to the USF contributions pool was “positive and necessary” but not enough to assure the fund’s “sustainability,” OPASTCO, the Independent Telephone & Telecom Alliance and Western Telecom Alliance said Aug. 4. As of Aug. 14, facilities-based DSL providers operating as non-common carriers no longer must contribute. Wireless and VoIP contributions might offset this drop in contributions, but “there is no assurance this will occur,” the groups said.
The Senate shut down for Aug. recess early Fri. without passing the telecom bill (HR-5252), despite Commerce Committee Chmn. Stevens’ (R-Alaska) week-long drive to round up the 60 votes needed to avoid a filibuster. On Tues. Steven was somewhat optimistic, he told reporters after the Republican policy lunch. “I think I've got them, but I'm not sure yet.”