FCC Chairman Julius Genachowski’s proposed universal service order lacks a “clear vision or roadmap,” leaders of the largest rural telecom associations said in meetings with FCC staff last week. Leaders from OPASTCO, NTCA, the Western Telecom Alliance and the National Exchange Carrier Association, along with executives from rural telcos, said the proposed overhaul isn’t comprehensive enough. “Such ambiguity, together with the imposition of new near-term constraints and the overhang of additional constraints or reductions in support to be considered in a further notice of proposed rulemaking, would only chill investment by RLECs and deter lenders and outside investors by perpetuating regulatory uncertainty,” the rural leaders said, according to an ex parte notice posted on docket 10-90.
FCC Chairman Julius Genachowski’s proposed universal service order would raise speed standards to 6 Mbps down/1.5 Mbps up, prune the so-called “right of first refusal” for incumbents, cut down the $2.2 billion set-aside for price cap carriers and reduce the transition time for rate-of-return carriers from 10 years to five, telecom and FCC officials told us Wednesday.
FCC Chairman Julius Genachowski offered reassurance Thursday, in a speech at FCC headquarters as he prepared to circulate the FCC’s version of Universal Service Fund and intercarrier comp overhaul, most likely late Thursday evening. Genachowski’s speech was short on details on how his proposal differs from plans already before the commission, particularly the ABC plan. Instead, he reassured consumers they have nothing to fear and that the proposed reforms will, in the long run, drive down the size of their monthly phone bills.
Open Range Communications filed for bankruptcy Thursday despite receiving the largest loan commitment under the Agriculture Department’s Rural Development Broadband Loan and Loan Guarantee Program. The Rural Utilities Service approved a loan of $267 million for Open Range in March of 2008, under President George W. Bush appointee RUS Administrator Jim Andrew. Open Range owes RUS about $74 million in secured debt, said the company.
The FCC confirmed that Chairman Julius Genachowski will circulate a proposed order that he hopes will lead to reform the universal service and intercarrier compensation regimes. The FCC called a briefing with reporters where agency officials spoke on the condition they not be named and said Genachowski will deliver a speech Thursday laying out some of his proposals. FCC officials declined to discuss specifics in Tuesday’s briefing, set for Thursday at 10:30 a.m. at FCC headquarters, instead reiterating their talking points about why reform was necessary.
The FCC might not adopt any existing plan to revamp the Universal Service Fund in its entirety, state officials said at a webinar by the National Regulatory Research Institute Monday. Even if the commission is to adopt an order for the Oct. 27 meeting, it might not be a final order, said James Cawley, chair of the state member of the Federal/State USF Joint Board.
Rural telcos and state regulators worry the pending universal service and intercarrier compensation regime reforms will result in consolidation in their sector. Earlier this week, ex-FCC commissioner Harold Furchtgott-Roth accused the agency of pushing rural telcos toward consolidation in the Universal Service Fund rulemaking notice (CD Sept 26 p13).
Cable advocates have taken their fight against the right-of-first-refusal provisions in America’s Broadband Connectivity plan to Capitol Hill, hoping to keep Congress from supporting the incumbent-backed plan, NCTA Executive Vice President James Assey told us Wednesday. President Michael Powell and Comcast/NBC Universal Washington President Kyle McSlarrow have been pressing their cases on the Hill. The goal is to keep legislators from signing incumbent-circulated letters to the FCC supporting the ABC plan, he said.
A group of consumer advocates and public officials urged the FCC to reject the incumbent-backed America’s Broadband Connectivity plan and the rural “consensus framework” for universal service reform. In a joint letter posted as an ex parte notice to docket 10-90 and organized by the National Consumer Law Center and the Utility Reform Network, the advocates said industry’s reform proposals should be “flatly rejected” (http://xrl.us/bmdmo8).
An influx of freshmen in the 112th Congress forced the telecom industry to increase education efforts in 2011, industry lobbyists said in interviews. This year there are 13 freshman senators and 93 new House members. As a result, telecom lobbyists have had to spend more of their time teaching the nuts and bolts of major telecom issues like spectrum and Universal Service Fund reform, lobbyists said.