The impending end of the USF quantile regression analysis, disclosed by FCC Chairman Tom Wheeler while being questioned at Thursday’s House Communications Subcommittee hearing, came as a shock to industry members who had long been urging QRA’s elimination. Wheeler told Subcommittee Chairman Greg Walden, R-Ore., he had asked the bureau to draft an order “to eliminate the QRA and return to the high-cost loop support model” (CD Dec 13 p4). There’s no word from the Wireline Bureau about what the replacement will look like, but many industry officials we interviewed were hoping for a predictable model based on plant depreciation.
Hill pressure on the idea of cellphone conversation on airplanes while in-flight escalated Thursday as all five FCC commissioners faced the House Communications Subcommittee, hours before the agency took up an item to propose allowing such conversation from a technical perspective (see separate report in this issue). At the hearing, FCC Chairman Tom Wheeler defended the proposal and said he’s talked with others in government about what will happen next. Members of both houses of Congress have raised the controversial issue, and the U.S. Department of Transportation is kicking off a process that may ban voice calls on planes, officials said.
Rural ILECs urged the Pennsylvania House Consumer Affairs Committee to eliminate carrier-of-last-resort (COLR) obligations and revise the state Universal Service Fund, at a hearing Thursday. CenturyLink, Frontier and Windstream were among the companies whose executives testified on House Bill 1608 at the hearing, sponsored by Rep. Warren Kampf (R). The committee also heard testimony from AT&T, AARP and the 60 Plus Association. This hearing was the continuation of one last month (CD Nov 22 p14) where Verizon, two Pennsylvania public utility commissioners and the state’s consumer advocate testified.
FCC Chairman Tom Wheeler backs a draft proposal to authorize cellphone use on airplanes in-flight, in prepared testimony for a Thursday House Communications Subcommittee oversight hearing. “I do not want the person in the seat next to me yapping at 35,000 feet any more than anyone else,” Wheeler plans to tell Congress (http://1.usa.gov/1bWwJOQ). “But we are not the Federal Courtesy Commission.”
The FCC Wireline Bureau suspended AT&T’s special access tariff revisions Monday. Agency officials told us the burden now shifts to the telco to demonstrate its filings are just and reasonable. The agency has five months to investigate, and the bureau will soon release a more detailed order focusing on specific questions and issues, commission officials said. They said all stakeholders will be able to file comments responding to AT&T’s comments. AT&T had sought to eliminate long-term contracts on its DS1 and DS3 special access services (CD Nov 26 p3).
The House Commerce Committee now takes up and may well pass two major telecom bills this week, aides and members said Monday. Reps. Doris Matsui, D-Calif., and Brett Guthrie, R-Ky., introduced the Federal Spectrum Incentive Act of 2013 Monday, with support of a top committee Republican and Democrats. Communications Subcommittee Chairman Greg Walden, R-Ore., also has revived the FCC Process Reform in amended form, and it is now expected to pass House Commerce due to compromise between Republicans and Democrats.
Panelists at a Practising Law Institute wireline panel cited continued difficulties with application of the FCC’s Universal Service Fund revamp in rural areas. An FCC official said the agency is willing to make changes where it can. Telco officials said the intercarrier compensation (ICC) revamp has been working more smoothly. Panelists debated the necessity of FCC regulation of IP services as carriers and customers switch from legacy technologies to packet-based technologies.
More collaboration is needed to achieve the broadband speeds of 10 Mbps downstream/5 Mbps upstream across Minnesota by 2015, as mandated by a 2010 state statute, said those at a Connect Minnesota conference Wednesday. Officials of state telecom associations, state legislators and members of Gov. Mark Dayton’s task force on broadband debated the progress of broadband adoption in the state and the next steps to further its development. In taped video address, Sen. Al Franken, D-Minn., said he will continue to ensure that any changes to the federal USF don’t harm small rural providers in the state, and will “protect the programs that provide broadband to all of Minnesota."
A new Senate bill proposing changes to the FCC USF is “confusing” on first glance, NARUC General Counsel Brad Ramsay told us, giving his personal take on S-1766, the USF Equitable Distribution Act of 2013. Sen. Kelly Ayotte, R-N.H., introduced the bill before the Thanksgiving recess, prompting praise from FairPoint in a statement last week (CD Dec 2 p10). The bill would make sure that rural states keep at least 75 cents for every dollar of USF contribution. Ramsay said the states that would be benefit are the rural ones that are net donors to the USF, but the states that are not designated as rural -- which the bill defines as ones in which “the total population density is not more than 200 people per square mile” -- will have to pay the difference, whether they are net donors or recipients to the USF. Most states -- 35 -- have fewer than 200 people per square mile, according to the 2010 census. Ramsay doubted it would be “politically palatable to come up with differing [USF] surcharges for different states,” leading him to speculate that there might be a hike in surcharges across the board if such a bill is passed. But an aide to Ayotte last week told us the bill would not increase the size of the USF, and the bill text contains language specifying that nothing should be construed as “requiring an increase in amounts collected by providers of interstate telecommunications from consumers for the purpose of making contributions.” Ramsay noted this language and suggested the FCC might only be able to make changes on the allocation of USF funds rather than the collection, which would still mean that non-rural states fund the difference. He questioned how the FCC would actually implement the language, saying that’s open to various possibilities.
A Republican Senate bill would change how the FCC’s USF doles money out to rural states. Sen. Kelly Ayotte, R-N.H., introduced the USF Equitable Distribution Act of 2013, S-1766, on Nov. 21, and the text of the bill appeared online last week. Ayotte has on multiple occasions in the past year criticized the USF, in particular the amount of money New Hampshire receives relative to its contributions to the fund. The bill’s purpose, according to its text, is “to provide for the equitable distribution of Universal Service funds to rural States.” The short piece of legislation provides for changes to the Communications Act of 1934, proposing the following language be added: “Not less than 75 percent of all amounts collected by providers of interstate telecommunications from consumers in a rural State for the purpose of making contributions … shall be allocated to the provision of universal service to consumers in that rural State.” An aide to Ayotte told us Friday that New Hampshire is a huge net-donor to the USF, receiving fewer than 40 cents for every dollar it contributes, whereas most other rural states are big net-recipients of the USF. The Ayotte bill won’t increase the size of the USF, the aide added. A rural state is defined as one in which “the total population density is not more than 200 people per square mile,” according to the bill. The FCC declined comment on the legislation. FairPoint applauds Ayotte’s efforts “to raise awareness” of areas that don’t see a good return on their USF contributions as well as the bill’s efforts to “remedy the situation” and help create “a fair distribution of USF-based funds,” a spokeswoman for the telco told us. FairPoint offers service in many rural markets across 17 states and serves New Hampshire. S-1766 lists no co-sponsors and is referred to the Commerce Committee.