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.
The Competitive Carriers Association asked the FCC to pause the phase-down of legacy USF support for wireless carriers until Phase II of the Mobility Fund is operational. The request came in a filing at the FCC Tuesday (http://bit.ly/1md24z2). “We are very concerned that the FCC’s draft Report and Order on USF will be detrimental to wireless carriers and the consumers they serve, especially those in rural areas where USF support is absolutely necessary,” CCA President Steve Berry said in a statement. “To avoid furthering the dominance of the legacy twin Bells, the FCC must act immediately to put USF reform efforts back on track to promote competition and benefit consumers who are choosing wireless services more and more each day.” Berry also urged the FCC to eliminate the right of first refusal for incumbent price-cap carriers. “Price-cap carriers already have been given the opportunity to accept support, and giving them another ‘first opportunity’ would allow them to take advantage of the process to maximize their own revenues, to the detriment of consumers,” he said. “The FCC has the opportunity to put USF reform on the right track again. Wireless carriers got the short end of the stick the first go-round -- with a 60 percent reduction of funding despite contributing more than half of the high-cost support funding -- and it’s time the FCC focused on restoring competition rather than further skewing USF support in favor of wireline carriers."
CTIA spent more on lobbying Capitol Hill in Q1 of 2014 than in it did in Q1 of 2013 -- $3.08 million this year compared to $2.95 million before, not counting outside firms it hired. This spending is substantially down from 2013’s Q4, however, when the association spent $3.57 million. CTIA lobbed widely this quarter, on issues from spectrum reallocation to data security, net neutrality to government surveillance. Quarterly lobbying disclosure reports are due April 21, but several lobbying firms, companies and associations have already begun filing theirs. Spending dipped for CEA, which spent $570,000 in the latest quarter lobbying on Internet regulation and provisions that would have killed the set-top box integration ban, and $660,000 the same time the year before -- and steeply below the $940,000 CEA spent in 2013’s Q4. The Computer & Communications Industry Association spent $200,000 in 2014’s Q1, up from $70,000 during the same period the year before. CCIA reported lobbying on several topics, from FCC spectrum auction rules to NSA surveillance to wireless competition issues. The Independent Telephone and Telecommunications Alliance spent $35,200. Even when companies and associations have not filed, the reports by firms they hired have begun showing up. Comptel paid Capitol Resources $27,500 and the Cormac Group $30,000 in Q1. The latter’s report showed lobbying priorities included IP-to-IP interconnection, USF overhaul and net neutrality. Reports from several of Comcast’s many lobbying firms have appeared, many citing lobbying on the Comcast/Time Warner Cable proposed deal (CD April 14 p3). Aereo paid Bingham McCutchen $110,000 to lobby on issues “pertaining to antennas and broadcast television,” one form said. More reports will be filed in the days ahead.
The Rural Wireless Association said the FCC should “immediately halt” the phase-down of USF support for high-cost wireless carriers because the Mobility Fund Phase II won’t be “operational” or “implemented” by June 30. “It is highly unlikely for Phase II to be ‘operational’ or ‘implemented’ by June 30, 2014, given the time it has taken the FCC to disburse Phase I funding,” RWA said in a filing at the commission (http://bit.ly/1jIfJNz). “In addition, carriers are now in the second quarter of 2014. There is not enough time between now and June 30, 2014 for the Commission to adopt final Phase II rules, have them published in the Federal Register, hold an auction, authorize payments, and disburse funds before the next scheduled phase-down of legacy support.” RWA said carriers need “predictability to formulate their business decisions, and currently there is no predictability with regard to the continued availability of USF funding ... as of July 1.” U.S. Cellular told the FCC it should be concerned about keeping funding flowing and the FCC should “fully implement Mobility Fund II at the earliest possible date,” in meetings with staff for the FCC commissioners, said an ex parte filing. Both mobility fund auctions to date demonstrated the need for funding, the carrier said (http://bit.ly/1eFA3R7). “In each case, demand for support far exceeded available funding,” it said. “In Mobility Fund II, when the standard will be areas that lack 4G service, many additional areas will be eligible and the resulting demand will be even higher."
How much money the FCC should devote to the rural broadband experiments -- and which criteria it should use to judge applications -- were debated in reply comments posted Monday and Tuesday. The agency received more than 1,000 “expressions of interest” in participating in the experiments. Other sticking points include whether incumbents should get right of first refusal; how to ensure high-cost support mechanisms like Connect America Fund (CAF) II still get the attention ILECs say they deserve; and whether to run experiments in areas that already see extensive broadband service.