Satellite Broadband Avoids USF Requirement Through Title I Approach, Says Executive
FCC Chairman Julius Genachowski’s plans to add net neutrality rules under the agency’s existing Title I authority comes as a relief to satellite broadband companies, said an industry executive. Under the Title I approach, satellite broadband would not be subject to Universal Service Fund contributions, as could have been the case had the agency gone forward with Title II reclassification, said Steven Doiron, director of regulatory affairs at Hughes Network Systems. Although the details of Genachowski’s plan haven’t been released, the FCC’s efforts aren’t expected to have major impact on satellite broadband providers’ businesses otherwise, said executives.
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That change in the legal approach marks the biggest effect of the agenda item on satellite broadband interests, said Doiron. Hughes, which doesn’t currently contribute to the fund for its consumer broadband services, has said it hopes satellite broadband isn’t included as a contributor or beneficiary if USF is reformed. Otherwise, Hughes is “hopeful that the net management rules would allow us to keep managing as we currently have,” said Doiron. While some discrimination is necessary for network management, the company doesn’t discriminate by the source of the content, he said.
WildBlue is “encouraged by the latest developments and thinks they fit well within the satellite broadband framework,” said company General Counsel Lisa Scalpone. “Although we have seen some concern about an endorsement of rationing, the reality is that, today, the majority of ‘average’ Internet users overpay because they are subsidizing the heaviest 5-10 percent of users on the network,” she said. The FCC shouldn’t create different rules for wireless providers that would presumably be based on “spectrum constraints,” she said. Satellite, for instance, is reliant on spectrum needs and should get the same treatment as other technologies, she said. The most fair way to move forward on net neutrality is to use a single standard for all technologies, said Scalpone.
The move toward a paid priority system could be helpful by allowing the bigger bandwidth users to pay for their pressure on the network as a whole, Scalpone said. “Paying only for bandwidth used should mean that most users pay less,” she said. “This is consistent with the FCC National Broadband Plan’s finding that 4 percent of users use up 40 percent of the bandwidth. Although unlimited use plans have great marketing appeal, right-sizing pricing to consumption is the most fair way to pay for the vast majority of consumers.”