Lawmakers in both chambers are preparing a letter to the FCC to address one of NTCA’s USF priorities on stand-alone broadband, reviving a bicameral, bipartisan letter sent to the FCC last Congress. NTCA also received promises from two lawmakers Tuesday that they will take the group’s priorities to heart, with legislation if need be. Prominent topics included overhaul of the USF, call completion problems and net neutrality, a controversial and partisan item in Congress.
Sprint and T-Mobile spent less on lobbying so far this year, Q1 lobbying reports showed. Monday was the deadline for quarterly lobbying reports, but many trade associations and companies hadn't filed theirs by our deadline. Observers have said net neutrality and proposed acquisitions are big drivers of spending in the telecom space, and those issues turned up repeatedly in the Q1 forms posted this week.
FCC Commissioner Mignon Clyburn urged on the FCC to move forward on overhaul of the USF Lifeline program. “The criticism that Lifeline does not serve its targeted audience because people already have phone service is a myth,” Clyburn said in a speech Monday at NTCA. “Too many consumers are struggling to maintain service, and we have a duty to respond.” FCC officials said Monday the agency appears headed toward an NPRM on a Lifeline overhaul, possibly this summer.
The FCC’s opposition to Allband Communications Cooperative’s petition for Supreme Court review of the agency’s 2011 USF/intercarrier compensation order should be rejected, the company said in a reply brief Wednesday. The company is contesting the order’s $250 per-line-per-month USF cap. The agency had argued Allband lacks standing to challenge the order because it had been granted a three-year waiver from the cap, has a pending petition to renew the waiver and thus hasn't been subject to the cap, said Allband’s brief. But the company said “’the ripeness doctrine’” shouldn't apply because the matter involves “issues of continuing public interest, capable of repetition and capable of evading review.” The agency also has no deadline for acting on the renewal request, and absent action, Allband would be subject to the cap July 1, the company said. The FCC also didn't respond to the company’s claims in its petition for review, including that the agency didn't follow applicable statutory provisions or congressional intent, the reply brief said. NARUC, U.S. Cellular and Cellular South have also asked the court to review a 10th U.S. Circuit Court of Appeals decision upholding the order on various grounds (see 1504090054).
The February FCC net neutrality order may provide momentum to any congressional proposal to end the FTC’s common carrier exemption, industry observers told us. That exemption precludes FTC Act Section 5 jurisdiction over common carriers subject to the Communications Act, and the FCC order reclassifies broadband as a common carrier service under Title II of the Communications Act, potentially upsetting jurisdictional boundaries. Any proposal may get entangled in net neutrality, complicating the issue in a messy legislative battlefield over agency authority for the FCC and FTC, observers said.
Beyond the usual difficulty in getting the Supreme Court to take a case, petitions (see 1504080050) seeking review of the 2011 USF/intercarrier compensation order (see 1405270045) face some obstacles, former FCC Chairman Reed Hundt and other telecom attorneys told us. U.S. Cellular’s argument that the net neutrality order adds to the urgency to deal with the agency’s Telecommunications Act 706 authority through the Universal Service Fund/ICC case is unlikely to move justices, they said.
U.S. Cellular urged the U.S. Supreme Court to decide the FCC doesn't have authority under Telecommunications Act Section 706 to regulate broadband, and said in its Wednesday brief that if the court agrees it would remove the “strong legal foundation” of both the net neutrality and the USF/intercarrier compensation order (ICC). “The validity of both sets of rules will have to be addressed in further rulemakings,” the brief said. The argument came as the company replied to the FCC’s opposition to various petitions for the court to review the 2011 USF/intercarrier compensation order (see 1405270045).
NCTA’s proposal to cut Connect America Funds from ILECs that don't meet the new FCC 25 Mbps download/3 Mbps upload standard (see 1501290043) is “baseless,” Frontier Communications said in reply comments on a notice of inquiry on ways to increase broadband deployment. NCTA had said in initial comments that the funds should be shifted to any broadband provider able to meet the standard (see 1503060064). Frontier called the proposal a “last-minute attack” and said pursuing the change would “severely delay the deployment of broadband to rural areas.” NTCA and the American Cable Association, in replies posted Tuesday in docket 14-126, also urged the agency to enact reforms to curb increasing programming costs. An ACA study took particular aim at “'Cablization’ of the Internet,” in which content providers charge ISPs fees on a per-subscriber basis to permit the broadband providers’ customers to access the content, said ACA's filing. Should “content providers pursue this business model, the effect on broadband deployment will almost certainly be immediate and grave,” ACA said. Among other reforms, the association urged the agency to monitor for “cablization” and address commercially unreasonable actions. Using Telecom Act Section 706 to deal with the costs of programming would not “present the challenges” of using the provision to pre-empt state anti-municipal broadband laws, the cable association said. Making video content available at affordable rates and under reasonable terms and conditions “spurs rural broadband investment,” NTCA said. It urged changes to USF to support smaller rural companies. Frontier noted that CAF Phase II is “specifically targeted to the areas that most need funding.” By requiring only 10 Mbps download/1 Mbps upload speeds for CAF, the agency is recognizing “a tradeoff between the number of households reached and the speeds achieved,” Frontier said.
Rep. Adam Kinzinger, R-Ill., wants to pursue “legislation to ensure forbearance will be permanent” in the FCC net neutrality order, which reclassifies broadband as a Communications Act Title II service and forbears from many Title II provisions, his spokeswoman told us this week. Kinzinger pressed FCC Chairman Tom Wheeler on the possibility at an FCC oversight hearing last month, as did Sen. Ted Cruz, R-Texas, zeroing in on making rate regulation forbearance permanent.
The FCC should set a timetable and move forward with USF contribution overhaul, Ad Hoc Telecommunications Users Committee counsel Andrew Brown, of Levine, Blaszak, told Nicholas Degani, an aide to Commissioner Ajit Pai, and Travis Litman, an aide to Commissioner Jessica Rosenworcel, in separate meetings March 31, according to an ex parte filing posted in docket 09-51 Thursday. The group represents large businesses in various industries that purchase telecommunications and IT services. The agency made significant progress in USF spending in its 2011 overhaul and temporarily stabilized the fund's size, Brown and consultant Susan Gately told the aides, according to the filing. The agency never finished the updates because it hasn’t dealt with contributions to the fund, the filling said. The fund’s contribution factor will continue to rise and December’s $1.5 billion increase in the E-rate annual spending cap (see 1412110049) threatens the stability of the fund, the ad hoc committee said. An agency federal-state joint board is charged with recommending by Tuesday whether broadband customers should pay into USF, though a footnote in the net neutrality order said the recommendation may be slightly delayed (see 1503120053).