Supported by at least 2 Bell companies, USTA urged the FCC in comments to leave the IP-enabled services market free of economic regulation. But some consumer groups argued the Commission should subject VoIP to Title II regulation to protect consumers, and use its authority to exempt such services from unnecessary regulations. The Local Govt. Coalition reminded the FCC it had “no power to adopt a comprehensive scheme for regulating information services independent of Title II, Title III or Title VI” of the Communications Act. Meanwhile, states pressed for a technology-neutral functional approach to VoIP oversight. “Regulators should not be choosing technology winners and losers,” NARUC Gen. Counsel Brad Ramsay told us. More comments were expected after our deadline Fri.
The organization that administers the universal service program reportedly is planning an audit of the prepaid calling card business to see if providers are contributing enough to the universal service fund (USF). A spokesman for the Universal Service Administrative Co. (USAC) said he can’t comment on whether audits are being conducted, but sources close to the process said the board recently approved funding to conduct such an audit.
SBC has joined Qwest’s court case against the FCC’s rules for determining the distribution of the “nonrural” universal service fund (USF), distributed to larger ILECs that serve rural areas, an industry source said. The 2 RBOCs have filed a petition with the 10th U.S. Appeals Court, Denver, to throw out the rules for the $260-million fund. Qwest has argued that the rules aren’t fair, since most funding goes to a few states, notably Miss. and Ala. The FCC determines funding levels on a statewide basis. Advocates for the Qwest approach have said that’s unfair to Western states, which have large land areas and sparse populations. Sen. Smith (R-Ore.)(S-1380) and Rep. Terry (R-Neb.) (HR-1582) have introduced legislation to change the system. The 2 bills have 110 co-sponsors, and nearly 75 independent groups have also signed onto the approach. However, an industry source said that while SBC is supporting Qwest on the court petition to abandon the old rules, SBC still isn’t actively supporting the bills.
Sen. Sununu (R-N.H.) and Rep. Pickering (R-Miss.) are hoping their VoIP bills will move this year, their aides said Wed. at a VoIP workshop sponsored by CompTel/Ascent in Washington. “We are pushing for passage [of HR-4129] this year,” said Mike Hurst of Pickering’s office. But he said that could be delayed because of the presidential elections. “Our intent [is] if not passage this year, [then] at least laying the ground[work]” he said, saying in that case he expected the bill to be passed “when Congress returns.” Mike O'Reilly of Sununu’s office said he was “very optimistic we are going to [move] the bill [S-2281] this year. We anticipate a hearing at some point soon.” No hearings have been scheduled on either bill.
Year-long talks aimed at working out an agreement on access charges through the Intercarrier Compensation Forum (ICF) have collapsed for now, with the formal departure Wed. of several key members -- including BellSouth, which initiated discussions with AT&T last year. Many of the discussions had been at BellSouth’s Washington office.
OPASTCO members from rural telephone companies throughout the country are lobbying on Capitol Hill this week to urge 3 things: Changes to the universal service program, a delay in VoIP legislation and repeal of the estate tax. “The message you're taking to Capitol Hill will directly impact your companies’ future, the viability of your communities and the ability of your customers to have modern service,” OPASTCO Pres. John Rose told more than 130 members Tues. at a morning briefing before the Hill visits: “Go to the Hill and deliver the message for rural areas.”
Advanced telecom capabilities such as broadband are being deployed to all Americans in “a reasonable and timely fashion,” telecom and cable operators said in comments to the FCC Mon. The comments were filed in response to the 4th inquiry launched by the Commission under Sec. 706 of the Telecom Act earlier this year (CD March 12 p6). The Act requires that the Commission conclude the inquiry and report to Congress within 180 days.
A bi-partisan group of House members is urging the FCC not to adopt a primary line restriction on universal service support. Citing a recent recommendation by the Federal-State Joint Board on Universal Service, the members said such a restriction would “wholly vitiate the purpose of universal service.” The members said a primary line restriction would put rural customers at a distinct disadvantage to urban customers because 2nd lines and cell phones would be more expensive for rural residents. “Rural customers would have the right to only one phone line at a reasonable cost comparable to urban areas, and their second lines could be charged exorbitant rates,” the letter said. The members said such a step would be “drastic” and would prevent the upgrade of facilities in urban areas. The letter also urged the FCC to consider rural small businesses in its final USF decision so that the result will “ensure that your final decision will not impair their ability to maintain lines in a cost effective way.”
AT&T said it had saved about $250 million since 2000 by not paying terminating access charges on phone-to-phone IP telephone calls, a practice the FCC recently said wasn’t allowed (CD April 22 p1). In a 10-Q filing with the SEC Mon., AT&T said as a result of the FCC ruling, the company will begin paying terminating access charges on the IP calls that will amount to about $15-20 million per quarter. AT&T said the FCC was also reviewing the way it computed access charges and universal service payments for calls made on enhanced prepaid calling cards (CD June 30 p6). The company said its current treatment of these calls “has generated approximately $215 million in access savings since the third quarter of 2002, and approximately $140 million in USF contribution savings since the beginning of 1999, compared with the cost that would have been incurred by a basic prepaid card offering.” AT&T told the SEC “an adverse ruling by the FCC on the prepaid card petition would… increase the future cost of providing prepaid cards.”
Even if it’s VoIP, telecom is “an essential public service” and local govts. will want to make sure reliable service is available to the public, said Marilyn Showalter, chmn. of the Washington Utilities & Transportation Commission. NATOA Pres. Coralie Wilson said govts. “simply cannot let technical standards lapse” just because of VoIP: “We need assurance the network will continue to operate.” Speaking on the same local govt. panel here, Neb. PSC Comr. Anne Boyle said “consumer protection goes beyond CALEA and E911.” She said VoIP providers need to comply with best practices, as well as with good customer service, and consumers are “who the government is there to protect.” At a later panel of FCC bureau chiefs, Wilson raised the question of mandating technical standards for new telecom services. He got little response, other than from Robert Pepper, FCC chief of policy development. Pepper indicated only that the Network Reliability & Interoperability Council would deal with such issues, and that the diversification of telecom into wireless and IP-based services increases diversity of the overall network. Local govt. officials spent much of their time talking about how to assure Universal Service Fund (USF) funding with the arrival of new technologies. Cal. PUC Comr. Susan Kennedy endorsed a per-number USF fee. Showalter agreed that’s probably “pretty reasonable,” though she said in the long term telephone numbers won’t be needed. Fla. PSC Comr. Charles Davidson, however, said USF “needs a business plan… It shouldn’t be a program that just expands and becomes a new tax.” Showalter suggested broadband will be necessary in the future and if people can’t afford it “government must assure that it gets there.” Kennedy, however, said Internet and video services “clearly” don’t qualify for USF. -- MF