FCC talks with rural telcos over potential USF restructuring have intensified, industry filings this week indicate. USTelecom and NTCA executives have had a number of recent meetings with senior FCC officials, including Chairman Tom Wheeler, to discuss proposals to update rate-of-return USF mechanisms and related concerns, said filings for the groups in docket 10-90. Wheeler appears interested in circulating a draft order soon, informed sources told us Thursday. An FCC spokesman had no comment.
A group seeking changes to rural healthcare USF received more opposition than support for its FCC petition to open a new rulemaking, in reply comments posted Friday and Monday in docket 02-60. Alaska Communications, CenturyLink and NTCA expressed resistance to the rulemaking petition filed by the Schools, Health & Libraries Broadband Coalition. Although the SHLB filed a reply supporting its petition, and the Salvation Army’s Alaska Division and Utah Education Network sought certain changes, the latter two didn't voice clear-cut support for the petition. Initial comments were divided (see 1601150060).
A group seeking changes to rural healthcare USF received more opposition than support for its FCC petition to open a new rulemaking, in reply comments posted Friday and Monday in docket 02-60. Alaska Communications, CenturyLink and NTCA expressed resistance to the rulemaking petition filed by the Schools, Health & Libraries Broadband Coalition. Although the SHLB filed a reply supporting its petition, and the Salvation Army’s Alaska Division and Utah Education Network sought certain changes, the latter two didn't voice clear-cut support for the petition. Initial comments were divided (see 1601150060).
The FCC approved a report saying broadband isn't being rolled out broadly enough or quickly enough to meet a statutory deployment mandate. The commission action at its Thursday meeting wasn't a surprise after Chairman Tom Wheeler circulated a draft report with a negative finding (see 1601070059). Democratic colleagues supported the report and its conclusion, with one backing an even higher broadband standard, but one Republican dissented and the other concurred while faulting the FCC for failing to bring about more broadband deployment. Key House Republicans and major wireline and wireless telco groups were among those criticizing the report, with USTelecom calling it “not believable.”
The FCC approved a report saying broadband isn't being rolled out broadly enough or quickly enough to meet a statutory deployment mandate. The commission action at its Thursday meeting wasn't a surprise after Chairman Tom Wheeler circulated a draft report with a negative finding (see 1601070059). Democratic colleagues supported the report and its conclusion, with one backing an even higher broadband standard, but one Republican dissented and the other concurred while faulting the FCC for failing to bring about more broadband deployment. Key House Republicans and major wireline and wireless telco groups were among those criticizing the report, with USTelecom calling it “not believable.”
NTCA said many rural carriers can't estimate their company-specific impact of the FCC’s “potential bifurcated approach” to updating rate-of-return USF mechanisms for broadband coverage. Reform details remain unsettled, the RLEC group said, and “average schedule” carriers have access only to “industrywide aggregate ‘price-outs’ that” are unlikely to reflect their particular results, and to their own spreadsheets consisting of “hundreds, if not thousands, of inputs,” which also remain works in progress. “We encouraged the Commission to remain open to simpler, more straightforward ways of achieving the same goals of reform via 'modules' (e.g., new limits or policy changes) that could be applied to any distributional mechanism rather than creating substantial new complexity by remaking the underlying distribution calculations,” NTCA said in a filing on an FCC meeting it had that was posted Monday in docket 10-90. It backed “sensible transitions” to how the costs of prior investments would be treated -- such as operating expense limits -- under an overhaul, including the proposed bifurcated approach, which would generally treat old investments under old rules and new investments under new rules. It's unclear how new limits or caps on prior investments, most of all sunk costs, would be consistent with the bifurcated approach, the group said, but if they're instituted, carriers would need time to adjust.
NTCA said many rural carriers can't estimate their company-specific impact of the FCC’s “potential bifurcated approach” to updating rate-of-return USF mechanisms for broadband coverage. Reform details remain unsettled, the RLEC group said, and “average schedule” carriers have access only to “industrywide aggregate ‘price-outs’ that” are unlikely to reflect their particular results, and to their own spreadsheets consisting of “hundreds, if not thousands, of inputs,” which also remain works in progress. “We encouraged the Commission to remain open to simpler, more straightforward ways of achieving the same goals of reform via 'modules' (e.g., new limits or policy changes) that could be applied to any distributional mechanism rather than creating substantial new complexity by remaking the underlying distribution calculations,” NTCA said in a filing on an FCC meeting it had that was posted Monday in docket 10-90. It backed “sensible transitions” to how the costs of prior investments would be treated -- such as operating expense limits -- under an overhaul, including the proposed bifurcated approach, which would generally treat old investments under old rules and new investments under new rules. It's unclear how new limits or caps on prior investments, most of all sunk costs, would be consistent with the bifurcated approach, the group said, but if they're instituted, carriers would need time to adjust.
Capitol Hill fell short of achieving many of the telecom goals lawmakers touted at 2015’s start. One session into the current GOP-controlled Congress, the scorecard disheartens some industry lobbyists and observers, but not all told us they saw reason for disappointment. Some emphasized what they judged key developments in spectrum and broadband deployment negotiation. Lawmakers said they hoped for 2016 progress on these issues despite likely presidential election distractions.
Capitol Hill fell short of achieving many of the telecom goals lawmakers touted at 2015’s start. One session into the current GOP-controlled Congress, the scorecard disheartens some industry lobbyists and observers, but not all told us they saw reason for disappointment. Some emphasized what they judged key developments in spectrum and broadband deployment negotiation. Lawmakers said they hoped for 2016 progress on these issues despite likely presidential election distractions.
The FCC is looking to overhaul rate-of-return USF systems fairly early in 2016, rural telco representatives told us. To support and spur broadband deployment, the commission is pursuing a two-track plan that would both modernize legacy subsidy flows and give rural carriers an optional new mechanism based on a cost model, they said Wednesday. The FCC’s “message to industry is ‘let’s keep working and see where we get to,’” said Lynn Follansbee, USTelecom vice president-law and policy. “I have no doubt that we will get to an order sometime early next year.”