AT&T and CTIA sought rehearing of a California Public Utilities Commission decision last month to adopt an emergency disaster relief program for customers of communications service providers. CPUC required providers to implement such programs upon a declared state of emergency by the governor or the president when a disaster results in service loss, disruption or degradation. The decision imposed obligations on landline providers “that are contrary to law,” AT&T said in one application posted Tuesday in rulemaking 18-03-011. The carrier “makes significant voluntary efforts” to help customers, but the decision “seeks to turn voluntary aid efforts … into mandates,” which “creates legal problems,” AT&T said. The CPUC is infringing on authority the legislature gave to the governor and the California Office of Emergency Services (CalOES), it said. Requiring carriers to provide various products and services for free for a year or more “creates an unconstitutional taking,” it said. Requirements for voicemail are pre-empted because that's an information service not subject to state regulation, and mandates about inside wiring and jacks are unlawful because that’s competitive and deregulated, AT&T said. Having to abide by requirements for 12 months or a period specified by CalOES “is neither explained nor supported by any record evidence or legal authority,” it said. Wireless carriers do much voluntarily, but the CPUC orders imposes “unlawful and inflexible” requirements, CTIA and AT&T Mobility said in a separate rehearing application. “Imposing a rigid set of requirements on carriers will deter wireless providers from tailoring their relief measures to consumer needs.” A VoIP coalition including AT&T, Comcast, Charter Communications, Frontier Communications and the California Cable & Telecommunications Association sought rehearing Wednesday. “Members of the VoIP Coalition have no substantive objection to voluntarily offering support similar to that set forth in the Rules to their VoIP customers,” the coalition said. “However, treating VoIP as a regulated utility service and imposing these disaster relief measures as mandatory requirements on VoIP service exceeds the Commission’s jurisdiction, is preempted by federal law, and should be corrected on rehearing.”
The FCC is opening an investigation on Sprint after the agency found the company claimed monthly subsidies for 885,000 Lifeline subscribers who weren't using the service, a violation of the program's non-usage rule, it said Tuesday in a news release. Those subscribers were nearly 30 percent of Sprint's Lifeline subscriber base and nearly 10 percent of all Lifeline subscribers, the agency said. The Lifeline program's non-usage rules require providers after 15 days' notice to de-enroll subscribers who don't use their phones at least once in 30 days. An Oregon Public Utility Commission probe brought the Sprint matter to light, the FCC said. Sprint is "committed to reimbursing federal and state governments for any subsidy payments" collected in error, a spokesperson said Tuesday. "The misconduct today, if true, amounts to corporate malfeasance," FCC Commissioner Geoffrey Starks said in a statement. He said Tuesday's announcement "directly impacts" the agency's review of the proposed deal between Sprint and T-Mobile. He said the review shouldn't go forward until the Lifeline investigation is resolved and responsible parties held accountable. The company said it discovered an implementation error after the company made system updates in mid-2017 in how it calculates Lifeline usage and eligibility after the FCC "approved sweeping changes" to the program. Sprint investigated "and proactively raised this issue with the FCC and appropriate state regulators," the spokesperson said. "We also engaged an independent third party to review the results of our review and the effectiveness of our operational changes." Opponents of Sprint/T-Mobile could question "whether, in light of these findings, Sprint is qualified to own its licenses. If it is not, then the question becomes what is the remedy," New Street's Blair Levin told investors Tuesday. A new round of litigation could further delay the deal's closing, Levin wrote.
FCC Chairman Ajit Pai said he remains hopeful the FCC will soon release an NPRM on sharing the 5.9 GHz band with unlicensed users, at the Americas Spectrum Management Conference Tuesday. “I did not say that I deferred to the Transportation Department on timing, but rather that I was working with DOT,” Pai said: “Those discussions continue and are productive and we hope to make progress in the near future." Pai highlighted the FCC’s three high-band auctions, with the largest to come later this year. Also important, the FCC’s work on the 2.5 GHz band, he said: “This summer, the FCC finally liberalized the rules for the band, allowing more entities to access the spectrum and eliminating unnecessary restrictions.” The FCC continues work on the C band, he said. “I’m optimistic that we will have results to show on this front this fall,” Pai said: “Also, the FCC is studying reallocation of spectrum in the 3.1 to 3.55 GHz band for commercial use, and I hope our federal partners will join us in that effort.” Pai said the work of the upcoming World Radiocommunication meeting will be important. “We need to enable regional and global spectrum harmonization opportunities for all services, including broadcasting, Wi-Fi, mobile technologies, and satellites,” he said: “We need to create international economies of scale, roaming, and interoperability, lowering prices for manufacturers and consumers.” Mid-band spectrum “will effectively serve as catalyst for future wireless services, especially 5G,” FCC Commissioner Michael O’Rielly said at the same event: “While high bands have the capacity and low bands have the coverage, mid bands provide the combination that is needed to realistically deliver the promise of 5G speeds, capacity, and low latency to a large number of Americans, especially those not living in our large cities.” O’Rielly said the C band is the “easiest and most appropriate band identified” for 5G. O’Rielly said he expects a C-band order to be ready soon. “The FCC is near completion of its review process and is finalizing details for its reallocation, which should come later this fall,” he said: “This doesn’t suggest there won’t be some controversy or last-minute details to sort out, but it will mainly involve squabbling over the specifics rather than any fundamental disagreement regarding the premise.” The FCC doesn’t need to run a C band auction itself, he said. If the FCC has to run the auction “we are talking years -- and I mean years -- before completion,” he said: “We can certainly ensure transparency, accountability, fairness, and openness without having to run the auction ourselves.”
Streamlining administrative hearings, as proposed by the FCC Enforcement Bureau (see 1909060049), is a good idea but could have little effect, Free State Foundation President Randolph May said. “Truth be told, these days the FCC conducts relatively few evidentiary ‘trial-type’ proceedings before Administrative Law Judges, the type of proceedings in which the Commission’s streamlining proposals, in theory, might have the most practical impact,” May blogged. The exception is agency review of a proposed transaction, he said. “Nothing in the NPRM prevents the Commission from referring factual issues to an ALJ for a trial-type hearing, including cross-examination of witnesses, in a case in which the agency determines that such an evidentiary hearing is warranted,” he said: “But the Commission’s Notice clearly contemplates that, absent a directive to the contrary, most often factual disputes, even those involving motive, intent, or credibility issues, should be susceptible to resolution on a written record rather than in an oral hearing conducted by the administrative law judge or other presiding officer.”
Tribal areas still don’t have all the broadband connectivity they need, though improvements are being made, FCC Chairman Ajit Pai said Monday at the National Tribal Broadband Summit. “Bringing high-speed connectivity to rural Tribal lands can be a game-changer,” Pai said: “It ... enables teleworking, job searches, and even starting an online business. It enables patients to consult with specialists without having to drive hours to the nearest hospital. And it enables students to take advanced math and science classes online, if they aren’t offered at the local school.” The Interior Department reports 73.3 percent of rural non-tribal locations have at least one broadband provider, compared with 46.6 percent of rural tribal locations. Pai emphasized tribal areas can obtain 2.5 GHz education broadband service licenses, under rules approved by commissioners in July (see 1907100054). “Before any commercial auction of this spectrum, Tribes can obtain this spectrum for free,” he said: “This is the first time in the FCC’s history that we have ever given Tribal entities what we call a ‘priority window’ to obtain spectrum for wireless broadband. ... I hope that Tribes will take advantage of it.”
Eutelsat met with FCC officials to explain why it left the C-Band Alliance (see 1909030041), saying it may rejoin. “Eutelsat continues to support the CBA’s proposal of employing a secondary markets approach to rapidly clear a significant portion of the 3.7-4.2 GHz band for 5G wireless services," the company said. It "discussed Eutelsat’s views concerning the appropriate role of each stakeholder, the potential allocation of a portion of the reconfiguration proceeds to the U.S. Government, and the treatment of eligible spectrum clearing costs,” said a filing posted Friday in docket 18-122: “Eutelsat expressed its willingness to reconsider actively participating in the CBA going forward if, among other things, the structure and management of the CBA could be altered to better represent the interests of all affected stakeholders.” Office of Engineering and Technology Chief Julius Knapp and Wireless Bureau Chief Donald Stockdale were among those who met with the company. The World Broadcast Unions raised concerns about FCC moves to open the C band for 5G. WBU wants detailed impact studies covering all stakeholders. “With insufficient C-Band spectrum remaining available for broadcasters’ use, existing distribution and collections systems may be compromised, especially in countries with equatorial geography and high rainfall,” WBU said Friday: “Reallocating C-Band frequencies to other services may, over time, increase pressure on the remaining uplink band further limiting its use and compromising existing C-Band users and service reliability, increasing costs to the broadcast community.” Qualcomm stressed the importance of the band to 5G, in a call with FCC staff, including Knapp. “The Commission’s efforts to open the 3.7 GHz band, which already is allocated for mobile use in other countries, is crucial to the success of 5G in the U.S.,” Qualcomm said. CBA and its members, meanwhile, told the FCC it agreed to allow access to confidential information in the C-band proceedings to three officials representing America’s Communications Association. It was an earlier topic of dispute (see 1909120033).
A backer of an alternative plan to free up some C band for 5G and from satellite use is speaking with programmers about that proposal, heard an America's Communications Association video interview by ACA CEO Matt Polka released Friday. It's "no big surprise" those who would have to move, such as with ACA "members, had a lot of questions about how this as going to work, and was this going to be as reliable a delivery service," said Senior Vice President-Government Affairs Ross Lieberman. "Ultimately, they understood the value." Allies of the ACA, Charter Communications and Competitive Carriers Association recommendation to use fiber in place of the satellite spectrum to deliver programming have been having "numerous conversions with programmers, both large and small, sort of a goodwill tour of education," he added. "A lot of the concerns we’ve heard have been just misperceptions." Maybe "our plan wasn't clear enough," and the concerns are being addressed, Lieberman said. "We’re in the process of putting together a supplement to our filing" at the FCC. Liberman has spoken with broadcast and with cable programmers, he told us Friday. "Everybody wants 5G, and I think people also want certainty, so I think the FCC is really trying to get this done as soon as possible," said Charter Vice President-Regulatory Affairs Colleen King. "Programmers have been using the C band for decades," so it takes "some warming up to get to" understand the ACA, Charter and CCA plan, even at her own company's video business, she said. "If we are going to give up this great resource we have, you want to make sure it’s fairly available to everybody" via FCC auction, King said. This plan gives CCA members "a fair shot at getting that spectrum," said CCA General Counsel Alexi Maltas. The C-Band Alliance would provide as much as 300 MHz of spectrum for 5G, less than the ACA consortium seeks. NAB isn't "aware of a single programmer that has endorsed the ACA proposal," a spokesperson emailed. "If that constitutes ‘warming up’" to the plan, he added, "we’re afraid to ask what cooling off looks like.” The CBA, FCC and NCTA declined to comment.
As ISPs increasingly offer low-cost broadband programs similar to Comcast's Internet Essentials (IE), the number of eligible households climbs, though a significant amount of the subsidization goes to households that would have been subscribed anyway. That's per Technology Policy Institute President Scott Wallsten and Stanford University Public Policy Program Director Gregory Rosston, presented Thursday at the Telecommunications Policy Research Conference. The study looked IE from 2011 launch as a voluntary FCC condition on the NBCUniversal acquisition through 2015. It found about 66 percent of subscribers were increases in low-income adoption stemming from the program, the remainder households switching from a competitor ISP or that would have signed up given adoption trends. It said IE-eligible households were more likely to take online courses or training than households in the footprints of other providers. It's unclear whether, when competing ISPs offer similar programs, customers benefit much or if the bonus is to the provider in customer retention. Wallsten told us such programs don't necessarily point to solutions for the digital divide. IE targeted households lacking broadband, and might not fly politically with a government program, meaning automatically broader eligibility for subsidies, he said. As fewer lack connectivity, holdouts become increasingly hard to reach, especially since research shows price isn't the dominant issue, he said, noting IE's heavily reduced monthly bill attracted only a share of the target population online. Comcast didn't comment.
The accelerating rate of cord cutting as vMVPD uptake stumbled shows those over-the-top services aren't a big driver of the trend, said analyst Craig Moffett of MoffettNathanson in an interview on C-SPAN's The Communicators set to run this weekend. He said "the new normal" for traditional pay TV is subscriber declines of 5 percent or so per year. He said there's an ongoing bifurcation between sports watchers and entertainment viewers, with the latter leaving cable and direct broadcast satellite as sports programming's fixed costs keep driving up pay-TV subscription costs. Moffett said the state attorneys general challenge of T-Mobile/Sprint has "reasonably good odds" of derailing the deal since the takeover isn't meaningfully different from the first iteration of the transaction that DOJ rejected. He said it's unlikely any tech giants will be broken up under the current antitrust scrutiny because antitrust laws aren't well suited for that and Congress isn't likely to undertake an overhaul soon. He said net neutrality is a hot-button issue largely because the debate was cast in terms of "bad guy" ISPs and "good guy" companies like Netflix. But net neutrality no longer energizes the base and thus is absent from discussion by the Democratic presidential candidates. Moffett said the U.S. is "still a few years out" from having wide blocks of midband spectrum needed to enable the transformational services 5G promises, so in the near term, it will rely on narrow midband blocks. On vMVPDs, they're struggling because they have "fallen into the same trap" as traditional MVPDs by having to offer increasingly fat and expensive programming bundles, the analyst said. Eventually, live TV will be the home only of sports and news, with all other content moving to on-demand, he said. Cable system operators don't necessarily care about sustaining the bundle and can focus on their broadband offerings, but DBS operators "are in a much tougher position," he said, programmers even more so.
Google’s plan to “implement encrypted Domain Name System lookups into its Chrome browser and Android operating system” could massively interfere with “critical internet functions,” telecom groups wrote Congress Thursday. NCTA, CTIA and USTelecom signed the letters to the Commerce, Judiciary and Homeland Security committees in both chambers. Google plans to implement the change through “a new protocol for wireline and wireless service, known as DNS over HTTPS (DoH),” they wrote. “If not coordinated with others in the internet ecosystem, this could interfere on a mass scale with critical internet functions, as well as raise data competition issues.” Google didn’t comment.