The “lack of spectrum probably constitutes the greatest threat to a healthy broadband ecosystem in our country 10 years hence,” Blair Levin, Aspen Institute fellow and former director of the FCC’s broadband initiative, said at the NextGenWeb Conference in Washington. There really is no unoccupied spectrum, or “marketing incentives for entities to allocate their spectrum,” he said. The National Broadband Plan’s recommendation for spectrum incentive auctions is aimed at “putting spectrum back in the marketplace,” he said. “If auction proceeds could be shared, the broadband ecosystem would have more spectrum, the entity could perform the same function better and taxpayers could benefit as well.” Levin also discussed the need for Universal Service Fund reform and said “today’s USF creates very significant problems.” He challenged those who have argued that the recommended speeds aren’t sufficient: “What’s not legitimate is to pretend that there are no costs to increasing the speed.” If anyone wants everyone in the country to support higher speeds for people in certain parts of the country, “they should be upfront … about the speeds they want, about their costs and about how they propose to pay for it,” he said. Although the FCC in September released a chart showing that about 70 percent of the country will some day have only one provider capable of delivering 50 Mbps downstream, it is no grounds for an unbundling regime, he said. The chart “is correct in terms of what we know today.” But “it may be wrong five years from now,” due to developments and upgrades from telcos, he said. “The argument for unbundling is premised on a projection that is subject to way too many variables and a policy with a potentially significant downside,” he said.
How universal service fits into Congress’ planned rewrite of the Telecom Act is expected to come up at a Senate Commerce Committee hearing Thursday on the Universal Service Fund, industry lobbyists said Monday. The Senate hearing opens a new avenue of Hill dialog on USF, an issue that lately has been mainly the domain of the House. House and Senate Commerce Committee staff meetings on the telecom law revamp start Friday (CD June 21 p8).
The National Broadband Plan poses a threat to “comparable, affordable voice and broadband service in rural areas,” the National Telecommunications Cooperative Association said in an ex parte filing about a meeting with the FCC Wireline Bureau staff. The threat will result from limiting the Universal Service Fund to support 4 Mbps download and 1 Mbps upload broadband speeds in rural areas, “while promoting 100 Mbps download speeds in urban areas.” NTCA also urged the FCC to consider expanding the USF contribution methodology to include all broadband providers, the association said.
FCC Commissioner Robert McDowell, who was recently in New York to meet with analysts and investors, said the message emanating from Wall Street was clear: Chairman Julius Genachowski’s “third way” broadband reclassification proposal is already having a chilling effect on investment. A divided commission is to take up the Genachowski proposal Thursday. McDowell also said in an interview Wednesday that the FCC should complete action on the stalled white spaces proceeding quickly, so devices can be on store shelves in time for the 2011 holiday buying season.
The Rural Utilities Service is anticipating that investment for round two of the Broadband Initiatives Program “is going to be more than double what we invested in the first round,” Administrator Jonathan Adelstein said at the Broadband Breakfast. The agency planned to have three rounds, but “folded the second and third rounds into the second one.” Adjusting the “remote” definition, increasing the grant component and other changes in the eligibility process encouraged more applications, he said. Most of the awards will be announced in July and August, he said.
The ongoing fight over whether broadband should be reclassified as a more heavily regulated “telecom” service has resulted in chaos for the broadband industry, FCC Commissioner Meredith Baker said Thursday at the annual Broadband Policy Summit, sponsored by Pike & Fischer. Baker also said work on the “third way” reclassification plan by FCC Chairman Julius Genachowski has distracted attention from the National Broadband Plan. Another danger is that increased FCC regulation of the Internet could lead to more government control of the Internet in other nations, she warned.
The most significant National Broadband Plan recommendation is the overhaul of the Universal Service Fund “to expand support to explicitly fund broadband,” FCC Commissioner Mignon Clyburn said at the Mid-America Regulatory Commissioners Conference of state officials in Kansas City, Mo. She said “up to 24 million Americans may not have access to broadband at home.” Although USF “provides some support of broadband networks indirectly, it does not do so in the most efficient manner,” Clyburn said. In the overhaul’s first phase, a Connect America Fund will be established to “specifically target support to extend broadband to unserved areas” and provide support in areas “where there’s no private sector business case to offer affordable broadband service without government support,” she said. Some claim that the new fund “will perpetuate a digital divide between urban and rural areas because it will only support broadband networks offering download speeds of 4 Mbps and upload speeds of 1 Mbps,” Clyburn said. The fund is for “providing to all Americans, no matter where they live, what most Americans already have available to them,” she said. The FCC recognizes that “there will be geographic areas where broadband has been built and that to continue to serve those areas, support will be required.” If broadband availability “decreases as a result of Universal Service Fund reform, then we will fail in our goal to reach all Americans.” Clyburn sought help from state regulators: “We are anxious to have your input on the proposed reform, carrier of last resort obligations and the current status of state high cost funds."
Utah’s Public Service Commission meets Tuesday to act on an application by Carbon/Emery Telcom for an increase in rates and charges and Universal Service Fund eligibility. The company and the commission have agreed to terms, including an $881,000 increase in the company’s annual intrastate revenue requirement. Under the agreement, Carbon/Emery could raise its base rates for residential and business services from $15.49 per month and $25.49 per month, respectively, to $16.50 and $26.00. The resulting annual revenue increase, estimated at $93,000, would be used in determining the company’s USF eligibility. The company’s total annual USF distribution would rise to slightly more than $1 million. The company agreed not to file for an increase in USF distribution based on 2010 results of operation except in extraordinary financial circumstances.
The three legislators most likely to be the next House Commerce Committee Republican leader have been active on telecom in the Communications Subcommittee. Current Ranking Member Joe Barton, R-Texas, could have to relinquish his post after the November election due to a House GOP caucus rule limiting Republicans to three two-year terms at the top of committees, whether the party is in the majority or minority. Communications Subcommittee Ranking Member Cliff Stearns, R-Fla., wants the job, his spokesman said. Telecom industry lobbyists said Reps. Fred Upton, R-Mich., and John Shimkus, R-Ill., may have a better shot.
Nexus Communications’ Reachout Wireless isn’t entitled to federal universal service funds in Tennessee because its Eligible Telecommunications Carrier (ETC) designation there only applies to wireline, the Regulatory Authority ruled Monday. “Nexus has misled our legislators and consumers that the TRA has the power to prevent Nexus from providing wireless service,” authority chair Sara Kyle said. “The TRA does not have jurisdiction over wireless providers, and because Nexus never applied to the FCC for proper certification, Nexus does not qualify for reimbursement from federal universal service funds.” The ruling reaffirms that Nexus “is not and has never been” approved under Tennessee law for federal USF reimbursement on 68 free minutes per month it was offering wireless customers qualifying for the Lifeline program, the regulator said. “Nothing in the TRA’s decision interferes with the ability of Nexus to continue to provide wireless service to its customers,” the authority said. “It merely precludes federal reimbursement to the company for the phones and free minutes it gives to its wireless Lifeline customers.” Nexus still can ask the FCC for ETC status, the state agency said. That would qualify the company for federal USF reimbursement for its “free” offerings in Tennessee, the authority said. The regulator advised low-income Tennesseans wanting Lifeline or Link-up service that Tracfone and Virgin Mobile are designated as ETCs and operate in the state.