Several industry voices backed changes to the wholesale reseller certification form of the FCC Wireline Bureau. AT&T, BT, CenturyLink, Orange, Sprint, Verizon and XO Communications filed joint comments with the FCC last week outlining several proposed edits to the Draft 499-A Instructions, which the Wireline Bureau had released as a redline document open for comments. “If a wholesale provider’s customer (or another entity in the downstream chain of resellers) actually contributed to the Universal Service Fund ('USF') on revenues from offerings incorporating particular services, there should be no double collection of USF contributions from the wholesale provider, even if the wholesale provider cannot demonstrate that it had a reasonable expectation that the customer would contribute when it filed its Form 499-A for the relevant calendar year,” the industry filing said (http://bit.ly/1c1dIW6). The joint comments ask for a footnote added to the form to clarify this point. It also asked for language “explaining how providers should account for services purchased after the date that the annual certificate is signed,” among other changes.
Connect America Fund Phase I incremental support should go only to areas where a price cap LEC demonstrates that a competitive provider is not providing broadband service, said NCTA, Charter Communications, Comcast, Cox Communications and Time Warner Cable in an ex parte filing Tuesday (http://bit.ly/1aZ4trQ). The CAF Phase 1 incremental support challenge process is a burden “imposed on cable operators that have nothing to gain from the process other than protecting their service areas from universal service fund-subsidized competition,” said the filing. When conflicting evidence is submitted by both an LEC seeking funding from USF and a provider, CAF Phase I incremental support shouldn’t be awarded, said the filing. “The [Wireline] Bureau should focus on the availability of service, not the provision of service.” LEC evidence that shows only that a portion of a census block is not served by a provider shouldn’t be given weight, said the filing. “The Commission has denied price cap carriers’ attempts to receive CAF Phase I incremental support in partially served census blocks based on evidence that some locations are unserved."
The challenge process for the latest round of Connect America Fund Phase I support has been burdensome for cable companies, Cox, Comcast, Time Warner Cable and NCTA representatives told FCC Wireline Bureau officials Monday (http://bit.ly/1aZ4trP). Cable operators “have nothing to gain” from the process except “protecting their service areas” from USF-subsidized competition, they said in an ex parte filing. The cable companies asked the bureau to focus on availability of service, not provision of service, because a provider may have no customers in a particular census block even if it offers service there. The companies also asked the bureau to not award support to a price cap LEC to overbuild a competitor “based on the title or status of the individual that certifies an area is served.”
The FCC should grant a permanent waiver of rules requiring the Oregon Public Utility Commission to provide a copy of a Lifeline subscriber’s certification form to eligible telecom carriers before that ETC can claim reimbursement from the federal USF, said the OPUC and the Oregon Telecommunications Association in a FCC petition Monday (http://bit.ly/1bSqPsA). The FCC Aug. 30 granted a limited waiver to California, Colorado, Florida, Idaho, Nebraska, Oregon, Utah and Vermont to allow more time for those states to implement a process to share copies of consumer eligibility certifications for Lifeline support with ETCs (http://bit.ly/1aRhRz3). The rules to require state Lifeline administrators provide subscriber certification forms to the ETCs are “unnecessary and cost prohibitive in Oregon,” said the petition. “Requiring the OPUC to provide copies of the certification forms to the ETCs does nothing to enhance the validity of the subscriber’s eligibility for Lifeline, but adds to the burden and costs to both the OPUC and the ETCs.” In turn, this will result in an “unnecessary lag” in the delivery of Lifeline benefits to eligible consumers, it said. The OPUC’s policy to verify ETC eligibility and perform checks to eliminate duplicate Lifeline benefits presents a “special case” compared to states where the ETCs are solely responsible for the same functions, said the petition. A weekly report of all Lifeline consumers approved by the OPUC is electronically transmitted to the applicant’s respective ETC, said the OPUC. This electronic notification is comparable to the certification form and it provides “sufficient safeguards” for the ETC to begin providing Lifeline benefits and apply for reimbursement from the federal USF, said the petition.
Adak Eagle Enterprises and its subsidiary, Windy City Cellular, made an impassioned plea to FCC Commissioner Michael O'Rielly in a meeting Wednesday, said an ex parte filing posted Friday (http://bit.ly/1h7JCHJ). “With winter fast approaching and the already harsh weather on Adak Island [Alaska] becoming even more severe, it is crucial that the remote Adak community be able to continue relying on the essential services provided by AEE and WCC,” the filing said. The telco and carrier have only six more weeks until their interim funding runs out. “It is up to the Commission to make clear that it did not intend for the USF/[intercarrier compensation] Transformation Order to result in remote communities losing wireline service (service built with tax payer-funded RUS loans), losing broadband service, losing 911 service, and losing most of their wireless service,” the filing said. “The Commission did not intend to discourage investment” or “intend for communities that have working communications systems go dark.” AEE and WCC understand that “O'Rielly was not responsible for the 84% flash-cut to WCC’s funding and the rapid phasedown of AEE’s funding that took effect in early 2012,” they said. They are merely “hopeful that he will take this opportunity to help correct the Commission’s course before the companies are forced into bankruptcy and the remote Adak community is left without its only broadband service, only wireline service, only working 911 service, and most comprehensive wireless service -- a service that regularly saves lives."
The FCC’s 2010 net neutrality rules are having no effect to date on how USTelecom members do business, President Walter McCormick said during a taping of C-SPAN’s The Communicators, eventually scheduled to be telecast on the network. “I haven’t seen them have any effect, whatsoever, on either competition or on our members or on the way in which we do business,” McCormick said.
Judges in the 10th U.S. Circuit Court of Appeals are likely to uphold the FCC Connect America Fund order, wrote Stifel Nicolaus analysts Christopher King and David Kaut in a research note Thursday. Based on what they have “heard and read so far” about Tuesday’s oral argument (CD Nov 20 p2, Nov 21 p6), the analysts expect the judges to issue their ruling in Q2 or Q3, generally upholding the revamp of the $4.5 billion USF and the intercarrier compensation framework. King and Kaut said the panel could be “more skeptical” about agency reforms limiting broadband USF subsidies for rate-of-return rural telcos. The ruling will be “generally helpful to ‘midsize’ price-cap wireline telcos” that gain access to broadband USF support, the analysts said. It could also be helpful to AT&T, Verizon and Sprint, which all stand to gain from reductions in long-distance and wireless intercarrier compensation payments to LECs, they said. “We note oral arguments can be a shaky barometer of court sentiment, and we believe particular caution is in order here, due to the complexity of the case and its fallout, and the fact that we did not attend the all-day session in Denver,” the analysts said. “So the court could still come out any number of ways, with murky ramifications."
Pennsylvania residents could see major changes to their wireline services in the state if the Legislature votes for a bill that would eliminate carrier of last resort obligations (COLR) for local exchange carriers in competitive areas and limit the USF, said industry, two Pennsylvania Public Utility commissioners, the state’s consumer advocate and other interested parties at a House Consumer Affairs Committee hearing Thursday. House Bill 1608, sponsored by Rep. Warren Kampf (R), would remove the PUC’s oversight of ILECs, and it would allows ILECs to self-declare whole exchanges as competitive. The bill would end the state’s USF on Jan. 1, 2019, and prevent the PUC from raising the amount of money contributed to the fund each year.
NARUC formally adopted resolutions on federalism and surveillance at the closing session of its annual meeting Wednesday. The resolution on federalism says cooperation and collaboration between state and federal regulators is the best way to ensure communications services remain universally available, affordable and reasonably comparable across the country. Approval marked the end of a yearlong effort to produce an update of a white paper on federalism and telecom in the 21st century. The resolution passed with small grammatical changes and a new clause to recommend that states retain a “prominent role in all decisions related to USF,” added by the telecom committee Monday (http://bit.ly/1h2MSEs). The resolution on government surveillance was significantly changed in committee to say telecom carriers have a obligation to protect customer proprietary network information (CD Nov 19 p13). The staff subcommittee, composed of state commission staff, significantly changed a resolution on cramming to include cramming and porting in its Sunday meeting, but it decided to recommend it to the telecom committee, made up of state commissioners (CD Nov 19 p11). The telecom committee decided to table the resolution until its February meeting in Washington, D.C. for further discussion.
DENVER -- The three-judge panel that heard an FCC USF case left attorneys impressed with its preparation for the oral argument, the attorneys said in interviews afterward. The 10th U.S. Circuit Court of Appeals Tuesday heard a challenge of the FCC 2011 Connect America Fund order, which revamped the rules of the $4.5 billion-a-year fund and set intercarrier compensation on a path toward bill-and-keep (CD Nov 20 p2). “They were engaged,” said Stinson Morrison attorney Harvey Reiter, who argued that the revamp of the USF and intercarrier compensation rules unlawfully hurt his rural CLEC clients. “They followed everything. I was amazed that they could jump from one issue to another. I think the court was pretty active.” But another attorney predicted a possible Supreme Court challenge if the 10th Circuit follows an irrelevant “tangent” in upholding the intercarrier compensation rules.