Sen. Brian Schatz, D-Hawaii, succeeded at quietly watering down the Senate’s set-top box rider attached to the FY 2017 Financial Services funding bill, which advanced through the full Appropriations Committee Thursday in a 30-0 vote. The rider, which would force a pause to the FCC's set-top rulemaking for further study, never came up directly during the long markup, encompassing FY2017 FCC and FTC funding. But Schatz changed the wording of the set-top rider through the bill’s manager’s package, unanimously accepted as part of the bill.
The FCC shouldn’t leave states in the cold as the commission mulls changes to rate-of-return rules for carrier cost recovery, said the Michigan Public Service Commission. The regulator and others filed reply comments that were due Monday in docket 10-90. The Michigan PSC said the FCC shouldn’t reduce or eliminate existing reporting requirements including Form 481, and urged the federal agency to reject the tentative conclusion that eligible telecom carriers (ETCs) shouldn't file a copy of Form 481 with states. Filling out and sending the form doesn’t cost much to telecom companies, but provides valuable information used by state regulators to prevent waste, fraud and abuse, the PSC said. Developing an online tool to permit access to all information submitted by ETCs is a good idea but shouldn’t exempt providers from filing a copy of Form 481 with states, it said. The PSC opposed removing service quality standards and consumer protection rules for ETC certification. “Many states, including Michigan, no longer have service quality and consumer protection standards due to deregulation,” it said. “Eliminating this requirement could create an environment for fraud and abuse and have the opposite effect of what the FCC intends.” Separately, rural carriers continued to warn about possible unintended consequences from sweeping changes, as they had in the first round of comments (see 1605130035). The FCC should “avoid injecting substantial administrative burdens and regulatory uncertainty into time-tested systems through subjective changes that will end up becoming a form of ‘Monday Morning Quarterbacking’ with respect to carrier operations,” NTCA said. “Instead, the Commission should focus its efforts on providing targeted prospective clarity where needed under existing rules to achieve policy objectives, promote certainty, and ensure accountability.” WTA said efficient USF spending is an important goal, but it shouldn't come at the cost of effective broadband deployment in rural areas. Acknowledging the complexity of the docket, the National Tribal Telecommunications Association urged the FCC to tackle tribal broadband issues first and separately from other issues. “The acceleration of broadband deployment on Tribal lands must be addressed as soon as possible and should not be delayed while the Commission resolves the multitude of additional complex issues raised in the Notice,” NTTA said.
The 2016 Internet Policy Platform, released Monday and backed by 17 public interest groups, urges policymakers to oppose “unreasonable practices, such as the use of punitive and unnecessary data caps and zero-rating schemes that favor the content and services of ISPs and their affiliates” and uphold the FCC net neutrality order and decision to reclassify broadband as a Communications Act Title II service. The backers include the American Civil Liberties Union, Demand Progress, Free Press and Public Knowledge. They sent the eight-page platform to party chairs and presidential contenders Hillary Clinton, Donald Trump and Bernie Sanders. “As the parties draft their platforms for 2016, they must listen to the millions and millions of people who want leaders to prioritize internet and technology policies that promote opportunity and free expression for all,” Free Press President Craig Aaron said. “The 2016 Internet Policy Platform offers a roadmap for any candidate truly committed to a future where everyone can share in the benefits of an open network free of gatekeepers, surveillance and discrimination.” The platform also addresses data security. Companies must take steps including “publishing annual reports about government data requests, notifying users when the government seeks to access their data or censor certain content, and requiring a search warrant before handing over user content,” the platform said. It urged reining in “Executive Order 12333, which is being used to indiscriminately collect masses of Internet data outside the U.S. -- even when that data includes some communications by people inside the U.S.” and opposing “legal limits to encryption systems that make them vulnerable to backdoor hacks and other incursions by government authorities.” The FCC “has a congressionally mandated responsibility to ‘accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition,’” it said. “The agency needs to take this mandate seriously and oppose the drift toward monopoly.” The groups encouraged promotion of “mobile broadband competition by taking a serious look at spectrum concentration” and acting “to reduce the stranglehold that the two largest carriers have over the most valuable spectrum -- both in upcoming license auctions and in terms of what these companies already control today.” They said the FCC should “safeguard” municipal broadband networks and “improve the efficiency and effectiveness” of USF programs.
The FCC rejected an appeal of a Wireline Bureau decision that denied a request of USCOC of Cumberland and Hardy Cellular Telephone (both U.S. Cellular units) to waive USF high-cost support filing deadlines. Rules 54.809(c) and 54.904(d) required eligible telecom carriers receiving interstate access support and interstate common line support to make certain certifications every year. While they've now been largely superseded by new rules under the 2011 USF and intercarrier compensation transformation order, the FCC said, U.S. Cellular in 2008 sought a waiver from the previous deadlines but was denied by the bureau and filed an application for review by the full commission. In its unanimous order Wednesday in docket 08-71, the FCC said the company failed to establish any grounds to overturn the bureau decision. U.S. Cellular didn't comment Thursday.
The House FY 2017 FCC funding bill retained its policy riders curbing the agency’s net neutrality order, mandating a pause to the set-top proceeding and mandating FCC process overhaul Thursday as it advanced to the floor. Appropriations Committee Republicans shot down Democrats' attempts to modify the Financial Services bill during the long full committee markup, approving the bill 30-17.
There's sufficient E-rate USF funding available to fully meet school and library demand for discounted service in the 2016 funding year beginning July 1, said the FCC Wireline Bureau in a public notice Wednesday in docket 02-6. The Universal Service Administrative Co. estimated in a letter this week that demand for the coming funding year would be $3.61 billion: $2.33 billion for "Category One" services providing broadband connectivity to schools and libraries, and $1.28 billion for "Category Two" internal broadband connections. The FCC has budgeted $3.94 billion for the E-rate program, and there's another $1.9 billion in unused funds from previous years, allowing the program to fully fund all of the requests for discounted service in both categories, the PN said.
At least $476 million in annual Lifeline USF spending remains questionable and perhaps wasteful, FCC Commissioner Ajit Pai said Wednesday. Pai said it appears that "unscrupulous" wireless resellers continue to take advantage of "override" processes to get around a commission rule aimed at preventing duplicative Lifeline telecom support to low-income consumers. "We need to get to the bottom of it and we need to root out the waste, fraud and abuse that has persisted in the program for a long time,” he told reporters at a briefing Wednesday on his latest letter seeking answers from the Universal Service Administrative Co., which runs USF for the commission.
The FCC proposed an E-rate eligible services list (ESL) for schools and libraries looking at participating in the USF discount program for the funding year starting July 1, 2017. Comments are due July 5, replies July 20, said a Wireline Bureau public notice Friday in docket 13-184. The program supports two types of eligible services: Category One covers services needed to provide broadband connectivity to schools and libraries, and Category Two covers internal connections. "The proposed ESL revises the description of eligible dark fiber service under Category One to read 'Leased Dark Fiber (including dark fiber indefeasible rights of use (IRUs) for a set term).' This revision is intended to further explain the distinction between leased dark fiber and self-provisioned fiber under E-rate program rules," said the PN. Among other possible updates, the PN proposes to include a new explanation on the treatment of connections between multiple buildings of a single school, classifying those located on a single campus as Category Two internal connections and those connecting buildings on separate campuses as Category One connections.
NARUC challenged the FCC Lifeline decision to bypass state regulators in setting up a national process for designating providers eligible for new broadband low-income USF support (see 1603310056). "Congress specifies that the FCC simply has no role in the [eligible telecom carrier] designation process unless the State cannot act as a result of State Law," said the state regulatory association in a petition for review Friday with the U.S. Court of Appeals for the D.C. Circuit (NARUC v. FCC, No. 16-1170). It said if upheld on review, the FCC's "flawed view of the power of an Agency vs. the power of Congress to specify the scope of ... agency powers will break new ground transferring yet another substantial swath of authority from Congress to agencies." The NARUC challenge isn't a surprise (see 1604010042).
The industry USF contribution factor for Q3 will stay at 17.9 percent of carrier interstate and international telecom end-user revenue, industry consultant Billy Jack Gregg said in an email update Wednesday. He said the Universal Service Administrative Co. projected industry long-distance telecom revenue for Q3 at $14.56 billion, about $181 million less than in the current quarter. The revenue drop is part of a downward trend that is putting upward pressure on the contribution factor over time, he said, but USF demand for Q3 also is projected to edge down to $2.18 billion, providing an offset.