The FCC unanimously voted to make changes to the Connect America Fund (CAF) framework, at its meeting Wednesday. As expected, the much-maligned quantile regression analysis formula is out, although what QRA will be replaced with remains an open question. Rural groups commended the commission for finally doing away with a USF disbursement regression formula that caused uncertainty and wreaked havoc on rural broadband investment. Rural groups are also pleased about a further NPRM that proposes a standalone broadband fund for rate-of-return carriers, which would provide support to rural telcos even if their customers don’t want to purchase bundled phone service.
FCC Chairman Tom Wheeler is considering adding net neutrality to the agenda for the May 15 FCC meeting, creating what could be a truly epic open meeting, industry and FCC officials told us. The FCC is already poised to vote then on service rules for the incentive auction as well as revised spectrum aggregation rules (CD April 21 p1). The next steps on net neutrality for the FCC are likely a notice of proposed rulemaking (NPRM) on revised rules, consistent with U.S. Court of Appeals for the D.C. Circuit’s Jan. 14 decision in Verizon v. FCC.
FCC Chairman Tom Wheeler is considering adding net neutrality to the agenda for the May 15 FCC meeting, creating what could be a truly epic open meeting, industry and FCC officials told us. The FCC is already poised to vote then on service rules for the incentive auction as well as revised spectrum aggregation rules ( WID April 21 p8). The next steps on net neutrality for the FCC are likely a notice of proposed rulemaking (NPRM) on revised rules, consistent with U.S. Court of Appeals for the D.C. Circuit’s Jan. 14 decision in Verizon v. FCC.
The Independent Telephone and Telecommunications Alliance proposed an alternative regulatory framework for rate-of-return companies, in a filing Thursday (http://bit.ly/1gHLzHh). The voluntary plan would address “some of the concerns associated with eventually moving to model-based support by providing stability, certainty, and an adequate transition period,” ITTA said. In Phase I of the two-phase plan, USF support would be frozen at current levels while participants continue to implement intercarrier compensation (ICC) rate reductions pursuant to the framework in the 2011 USF/ICC Order. They would then move to a price cap-like structure with respect to regulation of rates for special access service. In Phase II, which would begin after the Connect America Cost Model has been modified “to reflect the unique circumstances of [rate-of-return] companies,” participants would accept model-based support and assume service and public interest obligations, in the same way as price cap carriers under CAF Phase II, ITTA said. “We think it’s a noteworthy proposal that should move the industry forward,” ITTA President Genny Morelli told us. “We're hopeful that others will feel the same way.” The primary benefit of the plan is “knowledge of your revenues,” said Trey Judy, director-regulatory at the Hargray Communications Group. “We get stability of revenues, we know the revenues that we will be able to count on to build out broadband,” he said. The plan will also make it a more feasible and easier process to acquire funding, Judy said. Western Telecommunications Alliance Vice President-Government Affairs Derrick Owens said he’s sending ITTA’s proposed plan to his policy committee and plans to discuss it with the committee early next week. “I know I have some companies who are interested in model-based support” or are thinking about what would happen,” Owens told us. But “right now the model that’s out there -- the CAF Phase II model -- doesn’t work for rate of return carriers, and so we're going to take a close look at what ITTA proposed.” CAF Phase II doesn’t work because “the inputs just don’t line up with the actual costs for rate-of-return carriers,” he said. “Any type of model that doesn’t focus on actual costs is difficult for us to accept.” From what Owens has seen from the ITTA proposal, “it at least puts something out there that we can talk to our members about,” he said.
It’s not for lack of trying that Congress hasn’t overhauled the Communications Act since 1996. In December, House Commerce Committee Chairman Fred Upton, R-Mich., and Communications Subcommittee Chairman Greg Walden, R-Ore., outlined plans to update the landmark telecom law -- initial stakeholder comments posted online Wednesday (http://1.usa.gov/1dsVahV), hearings and white papers in 2014, a bill in 2015. They are hardly the first lawmakers to say they want to transform the act, which marked its 18th anniversary Saturday. Former staffers and congressional leaders involved in past attempts told us why recent high-profile efforts, such as in 2006 led by Republicans and in 2010 by Democrats, failed to succeed and what those experiences might portend for House Republicans now.
It’s not for lack of trying that Congress hasn’t overhauled the Communications Act since 1996. In December, House Commerce Committee Chairman Fred Upton, R-Mich., and Communications Subcommittee Chairman Greg Walden, R-Ore., outlined plans to update the landmark telecom law -- initial stakeholder comments posted online Wednesday (CD Feb 6 p8) (http://1.usa.gov/1dsVahV), hearings and white papers in 2014, a bill in 2015. They are hardly the first lawmakers to say they want to transform the act, which marked its 18th anniversary Saturday. Former staffers and congressional leaders involved in past attempts told us why recent high-profile efforts, such as in 2006 led by Republicans and in 2010 by Democrats, failed to succeed and what those experiences might portend for House Republicans now.
The FCC got lots of advice on process reform (CD Dec 6 p3), as part of an initiative being overseen by Diane Cornell, special counsel to Chairman Tom Wheeler. How much progress Wheeler will be able to make and what might come out of reform efforts is a big question mark, said industry sources including numerous former FCC officials. The full FCC is slated to get an update from Cornell at Thursday’s meeting.
The U.S. Court of Appeals for the D.C. Circuit’s net neutrality decision loomed large as the House Communications Subcommittee held its first hearing on updating the Communications Act 24 hours after the decision’s delivery. The Wednesday hearing focused on former FCC chairmen: Dick Wiley, Reed Hundt, Michael Powell and Michael Copps. It quickly turned into scrutiny of the Tuesday Verizon v. FCC court decision, which vacated the agency’s 2010 rules (CD Jan 15 p1), and what the FCC’s role over broadband should be.
The U.S. Court of Appeals for the D.C. Circuit’s net neutrality decision loomed large as the House Communications Subcommittee held its first hearing on updating the Communications Act 24 hours after the decision’s delivery. The Wednesday hearing focused on former FCC chairmen: Dick Wiley, Reed Hundt, Michael Powell and Michael Copps. It quickly turned into scrutiny of the Tuesday Verizon v. FCC court decision, which vacated the agency’s 2010 rules (WID Jan 15 p1), and what the FCC’s role over broadband should be.
NARUC’s Washington advocacy arm will eye all IP transition and broader FCC developments very closely, its new head told us. State regulators will also undoubtedly be watching what happens with any Communications Act update, a process that is largely welcomed, multiple commissioners told us, all stressing the need for a state role. Michigan Public Service Commission member Greg White was named chairman of the Washington Action Program group of commissioners last week and laid out plans for the group, which tracks all Capitol Hill and federal agency happenings in Washington for NARUC.