E-rate is “the most important thing we do at this agency,” FCC Chairman Tom Wheeler said as educators and technologists met at commission headquarters Tuesday to discuss an E-rate overhaul. “What’s important is not broadband qua broadband, but what broadband enables. If we're not using that enablement to address the issue of how we educate our students and provide opportunity for our citizens, shame on us."
More than 100 lawmakers asked the FCC to broaden USF support so it would no longer be limited to the provision of voice service. They emphasized the importance of providing USF support for those companies providing stand-alone broadband service. In total, 133 lawmakers signed the Senate and House letters.
Maine Gov. Paul LePage vetoed Legislative Document-1479 (http://bit.ly/1erkbfp), which would have required that any Public Utilities Commission decision on a $67.6 million-a-year public subsidy sought by FairPoint Communications (CD April 10 p30) be confirmed by the legislature. FairPoint had sought the subsidy from the Maine USF to continue providing landline service in the state. Companies like AT&T, CTIA, Sprint, U.S. Cellular and Virgin Mobile complained about FairPoint drawing from a fund the competitors pay into. The bill also would have delayed any Maine USF payment for at least a year. In his veto message, LePage, a Republican, said he’s not in favor of granting the annual average $51.54 surcharge increase that’s needed to pay for the subsidy. Delaying the increase for a year would not solve the problem, he said Wednesday, urging the legislature to do the “hard work to overhaul public policy. ... This is one of the clearest examples of simply punting a hard issue until after the election.” LePage said the bill abrogates the legislature’s taxing authority by not providing direction to the PUC. He said the state’s provider of last resort law is “antiquated,” and the legislature should either decide how to fund the requirement to provide landline service or get rid of the requirement. A PUC spokesman said a decision on FairPoint’s request is expected in late July.
The FCC unanimously voted to make changes to the Connect America Fund (CAF) framework, at its meeting Wednesday. As expected (CD Dec 18 p2), the much-maligned quantile regression analysis formula is out, although what QRA will be replaced with remains an open question. Rural groups commended the commission for finally doing away with a USF disbursement regression formula that caused uncertainty and wreaked havoc on rural broadband investment. Rural groups are also pleased about a further NPRM that proposes a standalone broadband fund for rate-of-return carriers, which would provide support to rural telcos even if their customers don’t want to purchase bundled phone service.
How fast does the Internet connection to schools and libraries really need to be? That question was a major focus of a Broadband US TV panel webcast Tuesday. Panelists disagreed on the need for further research into proper broadband speeds to schools, as some argued the FCC has to act fast, lest students continue to fall behind their international counterparts. As the FCC works on reforms to its E-rate program, the role of commercial networks -- and the agency’s ability to use E-rate funds for infrastructure buildout -- was also up for debate. At some point, the FCC will have to tackle contribution reform if it wants to continue pouring money into upgrades, panelists said.
FCC Chairman Tom Wheeler is considering adding net neutrality to the agenda for the May 15 FCC meeting, creating what could be a truly epic open meeting, industry and FCC officials told us. The FCC is already poised to vote then on service rules for the incentive auction as well as revised spectrum aggregation rules (CD April 21 p1). The next steps on net neutrality for the FCC are likely a notice of proposed rulemaking (NPRM) on revised rules, consistent with U.S. Court of Appeals for the D.C. Circuit’s Jan. 14 decision in Verizon v. FCC.
FCC Commissioner Mignon Clyburn said she hopes to see active designated entity participation particularly in the TV incentive auction expected to take place next year. Clyburn appeared Monday on SiriusXM’s “The Digital Show,” hosted by former FCC Chairman Reed Hundt. “I am definitely hopeful and am working behind the scenes, you probably have heard, to really ensure that the rules are in place in time enough for the auction,” Clyburn said of revised DE rules.
FCC Commissioner Ajit Pai wants the rate floor for phone service frozen indefinitely at its current $14 monthly average per subscriber, his spokesman said Monday. While the rate is frozen, Pai would be in favor of studying how to curtail “excessive subsidies,” which the rate floor doesn’t target, the spokesman said. The FCC last month announced the new rate floor of $20.46 (CD March 21 p14). A circulating order up for a vote at Wednesday’s commission meeting would phase in the rate increase, upping it to $17 in early 2015, with the rest of the increase scheduled for 2016, an FCC official said. A Wireline Bureau spokesman declined to comment.
State regulatory commissioners reiterated concerns about quantile regression analysis -- currently used to calculate high-cost USF funding but expected to be phased out over time -- with FCC Wireline Bureau officials during a conference call last week, according to a NARUC ex parte filing (http://bit.ly/1jQYTfw). “Several commissioners did express strong support for elimination of the QRA, as well as specifically endorsing the release of the data underlying the average urban rate calculation, and not allowing the new benchmark calculation to go into effect this year,” the ex parte filing said. The conference call included Wireline Bureau Deputy Chief Carol Mattey along with NARUC Telecom Committee Chair Chris Nelson, committee co-vice chairs Paul Kjellander and Catherine Sandoval, ex-NARUC President Philip Jones, Universal Service Joint Board State Chair Jim Cawley, Joint Board on Separations State Chair John Burke and other state commissioners. “There was also a brief discussion of closer collaboration on pending ETC [eligible telecom carrier] designations involving carriers seeking State designations that are under investigation by the FCC for non-compliance with the FCC’s rules,” the filing said.
FCC Chairman Tom Wheeler reassured Sen. Mary Landrieu, D-La., that he plans to end quantile regression analysis in determining high-cost USF support, as he’s previously told Congress. “I directed the Wireline Competition Bureau to prepare an Order for the Commission’s consideration that would eliminate the WRA,” Wheeler said in an April 11 letter, released Friday (http://bit.ly/1mkg5v2). “That Order, which will also address SNA [safety net additive] support, is now on circulation for my colleagues’ consideration at our April 2014 open agenda meeting.” Landrieu worried that the November 2011 USF order, which instituted quantile regression analysis, contained rules that “may hamper investment” in Louisiana, as she wrote in a Feb. 25 letter to Wheeler.