Adak Eagle Enterprises and its subsidiary, Windy City Cellular, made an impassioned plea to FCC Commissioner Michael O'Rielly in a meeting Wednesday, said an ex parte filing posted Friday (http://bit.ly/1h7JCHJ). “With winter fast approaching and the already harsh weather on Adak Island [Alaska] becoming even more severe, it is crucial that the remote Adak community be able to continue relying on the essential services provided by AEE and WCC,” the filing said. The telco and carrier have only six more weeks until their interim funding runs out. “It is up to the Commission to make clear that it did not intend for the USF/[intercarrier compensation] Transformation Order to result in remote communities losing wireline service (service built with tax payer-funded RUS loans), losing broadband service, losing 911 service, and losing most of their wireless service,” the filing said. “The Commission did not intend to discourage investment” or “intend for communities that have working communications systems go dark.” AEE and WCC understand that “O'Rielly was not responsible for the 84% flash-cut to WCC’s funding and the rapid phasedown of AEE’s funding that took effect in early 2012,” they said. They are merely “hopeful that he will take this opportunity to help correct the Commission’s course before the companies are forced into bankruptcy and the remote Adak community is left without its only broadband service, only wireline service, only working 911 service, and most comprehensive wireless service -- a service that regularly saves lives."
The FCC’s 2010 net neutrality rules are having no effect to date on how USTelecom members do business, President Walter McCormick said during a taping of C-SPAN’s The Communicators, eventually scheduled to be telecast on the network. “I haven’t seen them have any effect, whatsoever, on either competition or on our members or on the way in which we do business,” McCormick said.
Judges in the 10th U.S. Circuit Court of Appeals are likely to uphold the FCC Connect America Fund order, wrote Stifel Nicolaus analysts Christopher King and David Kaut in a research note Thursday. Based on what they have “heard and read so far” about Tuesday’s oral argument (CD Nov 20 p2, Nov 21 p6), the analysts expect the judges to issue their ruling in Q2 or Q3, generally upholding the revamp of the $4.5 billion USF and the intercarrier compensation framework. King and Kaut said the panel could be “more skeptical” about agency reforms limiting broadband USF subsidies for rate-of-return rural telcos. The ruling will be “generally helpful to ‘midsize’ price-cap wireline telcos” that gain access to broadband USF support, the analysts said. It could also be helpful to AT&T, Verizon and Sprint, which all stand to gain from reductions in long-distance and wireless intercarrier compensation payments to LECs, they said. “We note oral arguments can be a shaky barometer of court sentiment, and we believe particular caution is in order here, due to the complexity of the case and its fallout, and the fact that we did not attend the all-day session in Denver,” the analysts said. “So the court could still come out any number of ways, with murky ramifications."
Pennsylvania residents could see major changes to their wireline services in the state if the Legislature votes for a bill that would eliminate carrier of last resort obligations (COLR) for local exchange carriers in competitive areas and limit the USF, said industry, two Pennsylvania Public Utility commissioners, the state’s consumer advocate and other interested parties at a House Consumer Affairs Committee hearing Thursday. House Bill 1608, sponsored by Rep. Warren Kampf (R), would remove the PUC’s oversight of ILECs, and it would allows ILECs to self-declare whole exchanges as competitive. The bill would end the state’s USF on Jan. 1, 2019, and prevent the PUC from raising the amount of money contributed to the fund each year.
NARUC formally adopted resolutions on federalism and surveillance at the closing session of its annual meeting Wednesday. The resolution on federalism says cooperation and collaboration between state and federal regulators is the best way to ensure communications services remain universally available, affordable and reasonably comparable across the country. Approval marked the end of a yearlong effort to produce an update of a white paper on federalism and telecom in the 21st century. The resolution passed with small grammatical changes and a new clause to recommend that states retain a “prominent role in all decisions related to USF,” added by the telecom committee Monday (http://bit.ly/1h2MSEs). The resolution on government surveillance was significantly changed in committee to say telecom carriers have a obligation to protect customer proprietary network information (CD Nov 19 p13). The staff subcommittee, composed of state commission staff, significantly changed a resolution on cramming to include cramming and porting in its Sunday meeting, but it decided to recommend it to the telecom committee, made up of state commissioners (CD Nov 19 p11). The telecom committee decided to table the resolution until its February meeting in Washington, D.C. for further discussion.
DENVER -- The three-judge panel that heard an FCC USF case left attorneys impressed with its preparation for the oral argument, the attorneys said in interviews afterward. The 10th U.S. Circuit Court of Appeals Tuesday heard a challenge of the FCC 2011 Connect America Fund order, which revamped the rules of the $4.5 billion-a-year fund and set intercarrier compensation on a path toward bill-and-keep (CD Nov 20 p2). “They were engaged,” said Stinson Morrison attorney Harvey Reiter, who argued that the revamp of the USF and intercarrier compensation rules unlawfully hurt his rural CLEC clients. “They followed everything. I was amazed that they could jump from one issue to another. I think the court was pretty active.” But another attorney predicted a possible Supreme Court challenge if the 10th Circuit follows an irrelevant “tangent” in upholding the intercarrier compensation rules.
The IP transition may herald changes and an end to certain aspects of common carriage regulation, panelists said Wednesday at an event in Washington hosted by the Progressive Policy Institute. Platform competition now emerging may cause certain common carrier obligations to “melt away,” said Navigant Economics Managing Director Hal Singer. “Imposing these obligations when they're not necessary isn’t innocuous -- it’s very, very harmful.” A certain amount of competition must presage such melting away of obligations, he said, an area where the FCC could be of more help in producing data. Singer’s clients have included AT&T.
DENVER -- Judges seemed generally receptive Tuesday to FCC arguments that the agency acted reasonably when it implemented its landmark 2011 Connect America Fund order. The 10th U.S. Circuit Court of Appeals panel spent several hours hearing challenges to the order, which rewrote the $4.5 billion USF and set intercarrier compensation on a path toward bill and keep. As judges told challengers that ambiguous terms in the Telecom Act should be resolved in favor of reasonable FCC interpretation, challengers responded either that the terms weren’t ambiguous or the interpretation wasn’t reasonable.
ORLANDO -- The NARUC Telecom Committee approved resolutions on federalism and surveillance at its meeting Monday. The federalism resolution approved a yearlong effort to update a paper on federalism and how the states interact with the FCC and the industry. The surveillance resolution, introduced by Indiana Utility Regulatory Commissioner Larry Landis, was also passed by the committee with major changes to reflect concern that customer proprietary network information (CPNI) restrictions are being breached by telco cooperation with the National Security Agency. All NARUC commissioners will vote on the resolutions at the closing session Wednesday.
Two of the three judges set to hear a challenge Tuesday of the FCC Connect America Fund order are no strangers to telecom appeals. Judge Jerome Holmes of the 10th U.S. Circuit Court of Appeals last year ruled for the FCC in a case challenging its denial of a forbearance petition. Chief Judge Mary Beck Briscoe was on a 2005 panel overturning an FCC action on USF rules. Attorneys we spoke to said predicting outcomes based on past opinions is risky business. Some willing to venture a prediction said the panel’s history could bode favorably for the challengers, while others cautioned there weren’t enough cases to spot a reliable pattern. The 2011 order, which rewrote the rules of the $4.5 billion-a-year USF and set intercarrier compensation on a path toward bill-and-keep, will be the subject of several hours of oral argument that has had lawyers on all sides busily preparing (CD Nov 8 p10).