The Title II sections of the Communications Act the FCC would apply to broadband under Chairman Julius Genachowski’s reclassification plan could still burden operators with cumbersome rules and expose them to costly legal challenges, communications attorneys said Friday. Statements from Genachowski and FCC General Counsel Austin Schlick Thursday indicated Sections 201, 202, 208, 222, 254 and 255 would remain in place after a substantial forbearance from other Title II elements (CD May 7 p1). Sections 201 and 202 “are the key provisions of the Communications Act that have sort of kept behavior in check for almost 80 years,” said telecom lawyer Glenn Richards of Pillsbury Winthrop. “Anything that folks do, they're always thinking about it in terms of ‘Will it cause a 201 or 202 issue?'"
The time has come for the FCC to formally seek comment on whether it should “reclassify” broadband as a Title II service, subject to common carrier regulation, Public Knowledge Legal Director Harold Feld said Tuesday in a debate sponsored by the New America Foundation. Hank Hultquist, vice president of federal regulatory affairs at AT&T, countered that the FCC has plenty of authority regardless of the recent Comcast decision, and reclassification would be a mistake.
A Universal Service Fund revamp and additional public funding are needed to bring broadband to small businesses and encourage adoption, top government and broadband industry officials said Tuesday. At a hearing of the Senate Small Business Committee, FCC Chairman Julius Genachowski said high prices, sparse availability and low digital literacy are the largest barriers keeping broadband from small businesses. And NTIA Administrator Larry Strickling called continued funding in fiscal 2011 critical to ensuring a successful broadband stimulus program under the American Recovery and Reinvestment Act.
Rep. Rick Boucher, D-Va., is “making progress” on introducing his universal service fund bill and marking it up in the subcommittee, he said. The bill still has “a ways to go,” the House Communications Subcommittee chairman told us Monday. “We're looking for ways to control” the cost and size of the USF, while maintaining sufficient funding for rural carriers that depend on fund payments, he said. The bill is to be co-sponsored by Rep. Lee Terry, R-Neb.
A recent lobbying push by free conference call providers is set on getting “the truth out” to Washington policymakers about how consumers benefit from a business practice that long-distance carriers decry as “traffic pumping,” Free Conferencing Corp. CEO Dave Erickson said in an interview. But House Communications Subcommittee Chairman Rick Boucher, D-Va., who’s working on a bill banning such arrangements, told us his views have changed “not at all.” Congress and the FCC are both mulling curbs on the practice, which involves revenue-sharing agreements under which rural local exchange carriers pay conferencing companies to send traffic to their exchanges.
The FCC’s proposed net neutrality rules are “in big legal trouble” in the wake of the recent decision by the U.S. Court of Appeals for the D.C. Circuit in Comcast v. FCC, Commissioner Robert McDowell told reporters Friday. “The concept of a new regulatory regime is in real trouble.” McDowell is skeptical the commission should get more involved in the retransmission consent process, thinks TV spectrum reallocation won’t be held up by Comcast and hopes the regulator deals with an indecency complaint backlog, he said.
FCC Commissioner Mignon Clyburn hasn’t decided whether broadband should be reclassified under Title II, she said in an interview on C-SPAN’s The Communicators. She said she’s passionate about open networks, making sure consumers know what they are getting and other goals listed in the National Broadband Plan, but how the commission will accomplish them hasn’t been decided. “We are still in negotiations with the American public and companies we regulate” on how to move forward, Clyburn said. Public-safety network interoperability and a Universal Service Fund overhaul are among her major goals as the commission tries to carry out the plan, she said. On USF, the commission will work within the “existing financial framework” and won’t “cause the contribution factor to go up,” Clyburn said. “There is a probability of shifting in terms of the factors, especially as it relates to rural carriers, and those are the types of conversations we must have. Rural carriers, in particular, are concerned about the migration from land line support to this new kind of infrastructure or this new system we're putting forth. Those are the types of details we are going to have to work out.” Moving from the Public Service Commission of South Carolina was a culture shock because at the FCC there’s less interaction with the people involved, she said. The FCC filing process is exact and it’s a little “cold” compared to the evidentiary hearings at the state commission, Clyburn said. At first, she said, she sometimes felt like she was on a “big eighth floor island.”
In a surprise, CenturyLink agreed to buy Qwest in a $22.4 billion deal, including a $10.6 billion all-stock transaction and $11.8 billion debt, the companies said Thursday. The deal is expected to close in the first half of 2011. It’s likely to be approved by regulators within a year with attached conditions, such as an obligation to expand broadband access or to provide it at certain prices, analysts said.
The FCC issued a notice of inquiry and a notice of proposed rulemaking for a Universal Service Fund overhaul. The action at the commission meeting Wednesday jump starts the switch from the high-cost fund to the Connect America fund, said Wireline Bureau Deputy Chief Carol Mattey. The commission will seek comment on an analytical framework and cost model aimed at containing the cost of USF and identifying the places with the greatest need, said Amy Bender, a Wireline Bureau deputy division chief. “A model that identifies efficient levels of support could be an important tool even if the commission ultimately adopts market-based mechanisms to identify supported entities and support levels,” she said.
The FCC won’t undertake Universal Service Fund reform specifically for the non-rural high cost support mechanism, it said in an order. The commission decided it has met its statutory obligation to provide sufficient support, it said late Friday. The FCC also found that “rural rates are reasonably comparable to urban rates if they fall within a reasonable range of the national average urban rate. … The current non-rural high-cost support mechanism comports with requirements of Section 254” in the Communications Act.