Entries in NTCA (14)

Tuesday
Jan102012

NTCA: Include Text and Broadband to Cut USF Contribution Rate in Half 

With $2b Decrease to Revenue Base in 2 Years, “The USF is Being Starved”

When you glance at the National Broadband Plan action item website, you will see that it is reportedly at the 80% completion mark as the plan nears its 2 year anniversary. Then, look at the section called “Accelerate Universal Broadband Access and Adoption”—this is where all the “good stuff” on USF/ICC lives—and you will see that the FCC’s goals have largely been achieved. Except for one: the elusive USF Contributions NPRM. According to the action item agenda, “To stabilize support mechanisms for universal service programs, in Q4 2010 propose rules to reform the process for collecting contributions to the USF.” Well, here we are a year after this objective should have been achieved and still no progress on USF contributions reform…and NTCA is not letting the FCC forget about it, as evidenced by a January 9, 2012 Ex Parte meeting with FCC staff.

NTCA discussed with FCC staff “prompt and effective reform of the contributions mechanism that enables the federal universal service fund.” NTCA argued for a revenue-based contributions mechanisms that “is technology neutral and best captures the value that consumers place on competing services;” “reflects the balance that consumers strike between different service offerings and the evolution of consumer preference;” is the “most equitable means of sharing responsibility;” and “can be implemented quickly with little burden to providers or the industry.” NTCA further argues that a revenue-based mechanism would be stabilizing and not overly complex, unlike a mechanism based on numbers or connections.

NTCA believes that the FCC has ample authority to extend the contributions base. One of the most convincing arguments was that the FCC has obviously made it a key mission to reform USF for the broadband era, so it logically follows that contributions should also be broadband-centric. NTCA explains, “Given that the Commission has indicated that retooling the USF program to support broadband-capable networks is among the most significant policy priorities, it would be both self-defeating and ironically anomalous for the Commission to build a broadband-focused fund of tomorrow on a foundation comprised solely of legacy services that fewer and fewer customers are buying.”

“Fewer and fewer” is certainly no exaggeration—if the USF contribution base is kept as it is, there literally won’t be anyone to keep it afloat in the coming years. NTCA estimates that “Over the past 2 years, assessable Telecommunications Revenues declined by $2 billion.” Just looking ahead three years, JSI Capital Advisors has projected that total wired access lines will decline from 86.49 in 2012 to 56.55m in 2015; meanwhile broadband connections will increase from 102.30m in 2012 to 115.48m in 2015 (The ILEC Advisor: Communications Industry Forecast 2011-2020: ILEC and CLEC Access Lines; Communications Industry Forecast 2011-2020: Broadband Connections and Market Share). So… why hasn’t the FCC broadened the contribution base to include broadband connections yet?

Much of the fault likely lies in the challenge of deciding exactly who should contribute, and how much. NTCA recommends a revenue-based methodology, and suggests that the contributions base should be broadened to include non-interconnected VoIP revenue, fixed and mobile broadband revenues (a $49b base in 2012), and texting revenue (a $20b base in 2012). NTCA argues, “Non-interconnected VoIP and texting cannot function without supported networks, and should thus contribute.” Furthermore, “texting is increasingly a substitute for voice calls.” According to NTCA, including broadband and texting revenues in the contributions base could likely cut the steadily-increasing contributions factor in half. Fixing the supply side of USF is crucial, and NTCA stresses that “The shrinking Contributions Base must be fixed or all of Universal Service is at risk.”

So you include voice lines, broadband lines, all VoIP and texting in the contributions base—is that it? Probably not, according to NTCA, but the FCC should not hesitate to implement initial reforms before they decide who else should contribute. NTCA urges the FCC to study “how to address business models that rely heavily upon driving traffic from others to specific websites or web-based enterprises.”

Determining contributions for web-based businesses that “place substantial burdens on networks” and probably wouldn’t exist if not for the networks they utilize is definitely a murky area, but as NTCA suggests, this could be a longer-term goal. How would the FCC begin to determine which web-based businesses should pay into USF? Would it be based on traffic, revenue, bandwidth utilization, or something else? With the lines between service provider and content provider becoming increasingly blurry (Google being the prime example), how will the FCC apply a new methodology for companies that fall into different categories? One can expect content providers to cry foul that the FCC is attempting to stifle innovation by imposing fees in this realm, but if it weren’t for the networks, these businesses would not exist. They certainly wouldn’t be generating billions in revenue, or contributing massive strain on broadband networks, thus requiring service providers to continually invest in upgrading their facilities…

The debate over contributions reform is likely to heat up in the coming months, and it will be very interesting to see what the FCC—and the industry—comes up with for new methodologies and solutions to address the rapidly shrinking contributions base. What do you think should happen…and what do you think will happen?

NTCA’s Ex Parte filing is available here.

Sunday
Dec112011

Let the Challenges Begin! USF/ICC Order under Attack as Parties Turn to Courts

NTCA Files Petition for Judicial Review

As many of us are still trying to read and digest the 750-page USF/ICC Order, at least 3 parties have moved forward with court challenges—perhaps hoping that the judicial branch will alleviate some of the threats to various stakeholders as the December 29 start-date for the rules looms dangerously close. Earlier this week, small Virginia provider Core Communications and the Pennsylvania Public Utility Commission filed lawsuits in their respective states.  On Friday December 9, NTCA announced that it has filed a petition for judicial review of the USF/ICC Order with the U.S. Court of Appeals for the Fourth Circuit (in Richmond, VA, where Core filed its lawsuit).

NTCA’s press statement by senior vice president of policy Mike Romano explains, “To be clear, we appreciate the FCC’s attempt to loosen, if not untie altogether, the Gordian knots that have existed around the USF and ICC program for years. The order represents a historic step forward, and a significant achievement for the… stakeholders who worked to shape the reforms.” The court filing gets right down to business, however: “Portions of the FCC’s decision in the FCC Order are arbitrary, capricious, an abuse of discretion, contrary to statute and to the Fifth Amendment of the United States Constitution, in excess of or contrary to statutory authority, a departure from reasoned decision-making, and otherwise unlawful."

The press statement further explains that NTCA is specifically concerned with provisions in the order that “put at risk the ability of small, rural, community-based providers to access capital and invest in broadband-capable networks in their hometowns and surrounding countryside.” Specifically, NTCA points to the bill-and-keep access methodology that will ultimately price all switched access and reciprocal compensation at 0; the $250 cap on per line USF support; and provisions “blurring the lines between regulated and nonregulated operations.” According to NTCA, “These provisions will harm rural communities, and will not help to advance the availability and affordability of services for all rural consumers.”

Let’s talk about bill-and-keep for a moment.

Throughout the numerous comment cycles, rural stakeholders warned that bill-and-keep or access rates of 0 would be extremely harmful. The rural associations settled on an end-rate of $0.0007 in the Consensus Framework, but this rate was still considered by many to be too low. Despite the warnings and pleadings, the FCC still decided on bill-and-keep, which it claims in the Order “has significant policy advantages over other proposals in the record. A bill-and-keep methodology will ensure that consumers pay only for services that they choose and receive, eliminating the existing opaque implicit subsidy system under which consumers pay to support other carriers’ network costs…A bill-and-keep methodology also imposes fewer regulatory burdens and reduces arbitrage and competitive distortions inherent in the current system, eliminating carriers’ ability to shift network costs to competitors and customers.”  The FCC continues by arguing that bill-and-keep is less burdensome, and “reduces the significant regulatory costs and uncertainty associated with” a specific rate, like $0.0007.

Price cap carriers have a 6-year transition to bill-and-keep, and rate-of-return RLECs have a longer 9 year transition, illustrated below:

Rural carriers have shown concern that bill-and-keep is more favorable for carriers that exchange relatively equal traffic volume, and that this methodology will prevent small companies from recovering costs. The FCC rejects the argument that bill-and-keep is only appropriate for balanced traffic exchange. Furthermore, the FCC responds in the Order, “To the extent carriers in costly-to-serve areas are unable to recover their costs from their end users while maintaining service and rates that are reasonably comparable to those in urban areas, universal service support, rather than intercarrier compensation, should make up the difference.”

Except…. Per-line USF is capped per month at $250 (an amount which some fear could be arbitrarily lowered in the future, making even carriers who are “safe” today subject to drastic cuts), which appears to be NTCA’s other major concern in their petition to review filing. If you remember the pie chart from JSI Capital Advisor’s first article on USF reform which shows such a large slice of support going to RLECs ($2b of the $4.5b total), it begins to look like meager crumbs when you consider all of the elements in both USF and ICC support that are being reduced, capped, or otherwise manipulated by the new rules.

It will be very interesting to watch how NTCA’s petition for review, as well as the lawsuits filed by Core and the Pennsylvania PUC, progress in the coming months. Do you think the courts will make a reasonable decision? Are there any other major issues in the FCC’s Order that should be reviewed by the courts?

Read NTCA’s press statement here.

Monday
Oct242011

Rural Panelists Discuss Call Termination Problems – Causes, Effects, Solutions

A Perfect Storm of Economic Incentives and Technology Brews Arbitrage

USF/ICC reform may be the dominant rural telecom regulatory topic at the moment, but rural representatives from across the country took the initiative to come to the FCC this week and present information about rural call termination problems at a public Workshop. The purpose of the October 18 Workshop, which also included panelists from large ILECs and CLECs (but noticeably no pure VoIP providers), was to identify why these problems are occurring, what impact the problems have on companies and consumers, and how the problems can be solved with regulation, standards, enforcement or best practices.

This Workshop was the result of strong efforts by the Rural Associations and several state Commissions, who have pleaded with the FCC to address rural call termination issues throughout the year (The ILEC Advisor:  FCC Finally Gets the Message about Call Termination Problems). Commissioner Mignon Clyburn opened the Workshop by acknowledging that rural call termination problems are indeed troubling for public safety, health care, businesses and people just trying to communicate by phone. She sympathetically said, “I want my call to go through, and I know you want yours to go through as well.”

The first panel tackled the causes, scope and impact of the problems. Panelists included Robert Gnapp (NECA), Fritz Hendricks (Onvoy Voice Services), Denny Law (Golden West Telecommunications), Dave Lewis (ANPI/Zone Telecom), Kim Meola (AT&T), Dale Merten (Toledo Telephone) and Tami Spocogee (PAETEC). Gnapp summed up the situation by saying, “This is the most troubling, time consuming and frustrating problem [rural providers] have ever had to deal with.”  Hendricks added that it “vilifies” RLECs, even though he has “yet to find a rural carrier” who was at technologically at fault.

Lewis and Hendricks provided insightful comments about how the relationship between economic incentives and technology creates ripe opportunities for arbitrage. Lewis reasoned that as telephone rates increase, companies lose business, and they may look for ways to evade economic challenges and “change the cost dynamics.” Unfortunately, it costs more to terminate calls in rural areas, so companies facing economic pressure might refuse to terminate calls to high-cost areas in an effort to save money. Hendricks explained that “technology provides a vehicle for arbitrage, but economics create the incentive.”

In terms of the causes of call termination problems, many are quick to blame Least Cost Routing (LCR) technologies (and the carriers who utilize LCR). However, several panelists pointed out that LCR has been around for at least a decade, whereas these problems have dramatically increased in the last couple of years. Spocogee stated that LCR isn’t the problem if it is done correctly. Another possible troublemaker called “SIM Box Fraud” was also identified.

There was no shortage of examples of the impact on consumers and rural economies. Merten described a rural community in the Pacific Northwest with an economy based largely on tourism and charter fishing. He claimed that this rural community has been “absolutely devastated” as a result of calls not being completed to the charter fishing businesses. Merten’s company has invested significant resources and time to track and identify the source of call termination problems. In Law’s South Dakota service area, hundreds of automated calls from a school district failed to reach parents to notify them of school closings or other important news. Other panelists and audience members cited specific difficulties experienced by rural health care providers and sheriff’s offices. Gnapp explained that there have been at least 10,000 documented complaints, but the complaints are only a “small subset” of the real number of failed calls to rural areas, which could be in the millions or tens of millions.

The second panel addressed possible resolutions. Panelists included Scott Booth (Verizon), Jill Canfield (NTCA), Martin Corso (TDS Telecommunications Corp.), Penn Pfautz (AT&T) and Rick Ratliff (Sprint). The primary means to address call termination problems appear to be through regulatory intervention, enforcement, industry standards or best practices; but the panelists differed as to which solution is most appropriate. Considering how diverse the sources and causes of call termination problems are, a combination of resolution mechanisms may be the best course of action going forward.

One of the biggest challenges is actually figuring out the source of the problem—without this key information, it is indeed difficult to remedy the situation. A “carrier list” of contacts at IXCs who will help rural carriers address and resolve problems has been created, but Canfield commented that the carrier list is only helpful if the customer complains, the originating IXC can be identified, and the originating IXC is on the list. She also said that it places the burden on the consumer, and Corso later added that business customers are especially reluctant to contact their customers and then tell them to contact their originating carriers—it is definitely a lot of trouble for all parties afflicted.

I thought it was interesting that the large ILEC panelists all seemed sympathetic and dedicated to working with the RLECs on these issues, but the ILECs have the capacity to invest millions of dollars and dedicated staff specifically to monitor and track down non-compliant parties. For example, Ratliff mentioned that Sprint has an email address for call termination complaints and “several staff” who just monitor complaints and “go after bad actors.” Buying expensive monitoring technology and hiring several full time employees to address call termination problems is a luxury that few—if any—small RLECs can afford right now, yet the number of complaints can reach dozens per day. I would imagine some RLECs could keep a full time employee busy by just addressing call termination complaints.

Differences aside, Pfautz insisted that AT&T “[makes] money by completing calls, not by dropping them on the floor.” Booth added that Verizon wants calls to be completed so consumers have a “positive experience;” and Sprint and AT&T are both dedicated to shutting down arbitragers and ending relationships with non-compliant intermediaries.

Will the pledges to take a hard line on arbitrage be sufficient, or does the FCC need to intervene? The rural panelists at the Workshop seemed to agree that the upcoming ICC reforms will not be a solution in themselves, and the ideal course of action may be a combination of best practices, monitoring, reporting and enforcement. Canfield stated that best practices are a good start, but not everyone will follow them so long as there are financial incentives not to; Corso added that monitoring alone is not an appropriate solution. Canfield also argued that the FCC has the authority and ability to issue forfeitures under the current call blocking rules, and these problems could be treated as de facto call blocking.

Overall, this Workshop was very interesting and definitely an important first step in getting the FCC’s attention and moving forward towards consensus and resolution. A number of states are also conducting inquiries on this issue; so hopefully industry, government and consumer stakeholders will begin experimenting with and implementing remedies.

Meanwhile, it would be great if the “bad actors” would take note that RLECs are not going to sit back and continue to let these problems reach an epidemic scale. The fact that a number of panelist and a large portion of the audience in attendance at the FCC came from all over the country really spoke to the gravity of this matter. Indeed the significance and somberness should not be underestimated—as an audience member who traveled to DC from rural Missouri said, “One death because of this issue is not worth the billions of dollars saved.”

The full video recording of the Workshop is available here.

Thursday
Oct132011

Senate Hearing on USF/ICC: What is Fair Reform?

Hard Questions Asked about RLEC/ABC Plans, Rights of First Refusal, and State USF Equality

On October 12, 2011 the Senate Commerce Committee held a hearing entitled “Universal Service Reform – Bringing Broadband to All Americans.” The purpose of this hearing was largely to flush out details about the ABC and RLEC Plans as well as address many other specific aspects of USF/ICC reform—especially how the plans-at-large will impact consumers. This hearing was nothing if not comprehensive, and the Senators certainly did their homework to prepare challenging, thoughtful and hard-hitting questions. However, without anyone having seen the FCC’s draft rules yet, it was a stretch for the witness panel to say anything new and groundbreaking.

The panelists in the spotlight at this hearing included Kathleen Abernathy (chief legal officer and vp, Frontier Communications), Mary Dillon (president and ceo, US Cellular), Michael Powell (president and ceo, NCTA), Shirley Bloomfield (ceo, NTCA), and Philip Jones (commissioner, Washington Utilities and Transportation Commission). In other words: wireline ILECs, wireless, cable, RLECs, and states/consumers.  

The opening remarks by Senator John Kerry (D-MA) were a close reiteration of Genachowski’s speech last week (The ILEC Advisor: Finally – Genachowski’s Big Announcement on USF/ICC Reform), and Kerry seemed to focus on the shock-value arguments about USF being wasteful, inefficient and unfair. Kerry also referenced a recent Boston Herald article about the inequality of USF distribution between rural and non-rural states. According to the article, Massachusetts customers paid $169m into the fund in 2009 but only received $46m for schools, hospitals and low-income support…and a mere $2.4m for rural networks. Naturally, some are crying unfair, and the issue of state inequality popped up several times throughout the hearing.

Senator Jay Rockefeller (D-WV) “wholeheartedly applauded” Genachowski’s efforts on USF/ICC reform, but noted that “it is huge and complicated” and some parties will be unhappy with the results no matter what happens. Rockefeller emphasized—by saying twice—that broadband is the “essential infrastructure of our day,” and it is “what this country requires to compete internationally, something we do rather poorly.” He also commented that broadband deployment is important, but “we would be remiss if we did not also consider efforts to promote adoption.”

Testimony from the panelists did not really deviate from the positions that their respective industries have been advocating all along. For the wireless perspective, Dillon insisted that $300m is simply not enough for the Mobility Fund, and that reforms must recognize the wireless industry is growing while the wireline industry is shrinking. Powell argued for the cable industry: “while companies get the money, its consumers who write the check,” and it will be a “travesty and a lost opportunity” if the reforms are not competitively and technologically neutral.  State commissioner Jones expressed concern about state preemption and subscriber line charge increases. Wireline panelists Abernathy and Bloomfield both described their respective commitments to rural America.

If I had to name a theme for this hearing, I would pick Equality and Fairness. Unfortunately, there isn’t a uniform theory on what constitutes equal and fair when it comes to USF and ICC. Rockefeller asked what the essential elements of a fair system would be, and the responses varied. Abernathy replied that it is fair for companies receiving USF to accept a level of regulatory oversight in exchange. Dillon responded that it is fair to recognize the role of wireless as much as wireline. Powell’s answer was to focus on consumers, not companies. Bloomfield said it is important that companies do not “cherry pick” the most profitable unserved areas and leave the rest behind. She also said that sustainability is fair, and “infrastructure is not something you throw into the ground and walk away,” it is a “living breathing network that needs continued investment.” Finally, Jones argued that it is fair for states to remain a viable forum for consumers, because telecom is “a very complained-about industry.”

Senator Mark Warner (D-VA) stepped up during the Q&A and really asked a wide variety of good and challenging questions about the ABC and RLEC Plans, specifically about the ABC Plan’s Rights of First Refusal  (RoFR) proposal (The ILEC Advisor: Six ILECs Defend Rights of First Refusal Proposal). Warner said he “gets the idea” behind RoFR, but it seems like a “blunt instrument” and contrary to the spirit of competition. Warner asked if there is some middle ground between the ABC Plan’s proposal and no RoFR at all, possibly by utilizing some type of “sliding scale” where previous investment would be acknowledged. Abernathy responded that nobody is serving these areas anyway, and any other framework would probably take too long. Bloomfield clarified that RoFR is not included in the RLEC Plan.

RoFR came up in several more questions. Senator Kelly Ayotte (R-NH) asked what might happen if the RoFR proposal was completely replaced with reverse auctions. Powell replied that it is an exaggeration to say that a reverse auction model would take too long to develop, and the FCC is “the best expert in the world on auctions.” Senator John Thune (R-SD) specifically asked Powell if there was a way to tailor the ABC Plan to permit RoFR but also address the cable industry’s concerns. Powell stated that the cable industry agrees with about 75% of the ABC Plan, but it did not sound like there would be much “middle ground” when it came to resolving differences about RoFR.

Keeping with the spirit of fairness, equality, compromise and level playing fields, Senator John Boozman (R-AR) asked Dillon if there is any chance of a compromise on the size of the Mobility Fund somewhere between $300m and $1b. Dillon replied that $1b actually is a compromise and even that amount “doesn’t really cut it.” Abernathy pointed out that $300m per year is actually 10 times more than the amount of money envisioned for mobility in the National Broadband Plan—the NBP called for a one-time $300m investment only.

Overall, this hearing was informative but predictably lacked surprises. With the FCC’s draft rules already in circulation, but yet unknown to the public, I wonder if this hearing will have much of an impact on the end result. It may have been better if it were held after the release of the rules, so that the panelists could have really predicted the impacts of reform on their companies and customers.

The Senators who asked questions and provided anecdotes and information seemed to be looking for ways to balance all of the conflicting interests, which is certainly a daunting task. They also wanted answers that do not yet exist. We don’t know if the FCC’s rules meet the myriad definitions of fair, equal, level playing field, and compromise; but Senator Rockefeller insisted that we cannot keep putting off reform until everyone is happy—the nature of reform is that not everyone will be happy.

A full recording of the hearing, as well as testimony from the participants, is available here.

Sunday
Oct092011

Response to USF/ICC Rules Varied, but Everyone Wants More Details

Genachowski’s Speech Prompts Industry-wide Reactions—to What, Exactly?

FCC Chairman Julius Genachowski presented a sneak-peek at the FCC’s highly anticipated USF/ICC reform rules on October 6, but many industry stakeholders are still scratching their heads trying to figure out specific details of the yet-unreleased draft rules. Genachowski made a point to say that the draft rules are not a carbon copy of the ABC Plan/RLEC Plan/Consensus Framework, but he did not specify exactly what parts of the industry plans would be included or rejected (see The ILEC Advisor: Finally – Genachowski’s Big Announcement on USF/ICC Reform for a summary of his full speech). I guess we will all just have to keep waiting…

Key USF/ICC stakeholders wasted no time in releasing statements about Genachowski’s speech. Although the reactions ranged from approval to frustration, one thing was clear: everyone wants more information as soon as possible.  Some statements were quite vague, and others seemed to make assumptions about the unseen rules inferred from Genachowski’s remarks. The ILEC Advisor has been covering different industry perspectives on USF reform over the last few months, and most of the reactions to today’s announcement were consistent with the mountain of comments and ex parte filings that have accumulated since February’s NPRM.

Here’s a rundown of reactions—good, bad and indifferent (in no particular order):

  • Shirley Bloomfield, NTCA ceo: “As this long-running process draws to a likely close in the coming weeks, we will continue to press for common-sense reforms that recognize the unique challenges faced by small carriers and the consumers they serve in rural areas across the country.”
  • Kelly Worthington, WTA executive director: “We look forward to seeing the details of the Chairman’s proposals. Only then will we be able to determine whether rural networks will be strengthened by the reforms.”
  • Matthew M. Polka, America Cable Association president and ceo: “The Chairman’s plan locks in a sole-source contract worth billions over 10 years to a handful of incumbent large telecom companies to deploy broadband at maximum speeds that are below average. It favors one small group of providers over others to the disadvantage of consumers. By excluding thousands of broadband providers willing, able, and eager to compete to provide service to consumers living in rural areas where government support is provided, it will deprive these communities of receiving the best possible service at the lowest possible price.”
  • Steven Berry, Rural Cellular Association president and ceo: “Chairman Genachowski delivered a fine policy speech highlighting the many reasons USF reform is imperative. I am glad to see he is focused on consumers and bringing broadband solutions to all Americans, but details remain elusive, and we must carefully review the proposal… I can only hope that wireless solutions have an opportunity to flourish in this new plan.”
  • Matt Wood, Free Press policy director: “We hope that Chairman Genachowski is sincere in his pledge to give the American people something better than the industry’s profit-padding wish list. But knowing how doggedly these companies pursue what they want, no matter how much it harms the public, we’re going to be vigilant and make sure that the Commission abides by that promise.”
  • Tony Clark, NARUC president, and John Burke, NARUC Telecommunications Committee chair: “We are very anxious to get additional details on the mechanisms for Intercarrier Compensation reform, including how Voice over Internet Protocol traffic will be integrated into the system to avoid arbitrage opportunities. Indeed, some elements of the speech raise a host of unanswered questions but also the specter of long term and serious unintended consequences for consumers.”
  • Bob Quinn, AT&T vp-federal regulatory & chief privacy officer: “FCC Chairman Genachowski deserves credit for bringing this important issue to this point. We and many others are committed to working with him and the entire Commission as it works to bring this opportunity for a fair, reasonable plan across the finish line.”

A common point of tension seems to be whether or not the FCC’s plan will be good for consumers. However, what is best for consumers—lower telephone rates, or expanded broadband availability?  More importantly, can both of these lofty goals be achieved in one fail swoop? If, for example, access rates were reduced significantly, would the big telcos pass the savings along to consumers directly, pocket the extra cash, or reinvest it in the network? I imagine these questions will not be answered until after the rules are implemented.

It is not just industry groups reacting to the FCC’s proposed rules (whatever they may be). Congress is weighing in as well. A bipartisan October 4 letter to Genachowski signed by Representatives Lee Terry (R-NE), Mike Ross (D-AR) and 33 mostly rural representatives states, “It’s our judgment that the FCC must act swiftly yet carefully to enact reforms that allow all Americans – particularly those in hard-to-serve rural communities – access to the burgeoning services and opportunities that are being created via innovation in broadband technology.” The Representatives “urge the FCC to maintain the key elements of the America’s Broadband Connectivity and Joint Rural Association proposals,” which “clearly [create] a path forward for comprehensive USF and intercarrier compensation reform.”

While it is admirable that so many Democratic and Republican Representatives came together in support of the Consensus Framework, the FCC’s final rules might not have a VIP pass in the Senate. On October 5, the Senate Commerce Committee announced an October 12 hearing on the FCC’s USF/ICC reform efforts. Apparently, “Congressional Democrats have expressed concerns that the plan won’t sufficiently protect consumers.” I wonder if the Senate Commerce Committee will actually see the plan before the hearing next week, or if they have already seen it? It seems premature to set a hearing about rules that have not even been approved or reviewed by the public, but there doesn’t seem to be much love between Congress and the FCC these days.  

The draft rules were supposedly circulated to FCC Commissioners, as the rest of us anxiously await more details. Let the speculation continue!