At least 3,000 consumer letters were filed in the FCC’s universal service docket (96-45) Wed. urging the FCC to reject a proposal to move to a flat fee for universal service fund (USF) contributions by carriers. The letters, all the same, appear to be written by a lobbyist group. At our deadline, its identity couldn’t be confirmed. However, one of the letters indicated a link to a website -- http//keepusffair.org -- sponsored by a consumer coalition that includes the Telecom Research & Action Center (TRAC). Signed by individuals from throughout the country, the letters told the FCC: “I do not want to pay more for my telephone service! I urge you to reject a flat fee proposal that would change how contributions are made to the Universal Service Fund… Under the flat fee you are considering, people who make few long distance calls would pay the same as people or businesses that make many calls… This is unfair.” The letter also makes reference to wireless service: “I use my wireless phone for safety, security and convenience. I don’t want to lose those benefits so big businesses can pay less than their fair share.”
A rumored merger between SBC and AT&T could get done but would probably take a long time to receive regulatory approval and require major divestitures, many industry sources and analysts agreed. They said with cable and wireless entering the market, AT&T wasn’t the most important competitor to the Bells any more. “From antitrust and regulatory [standpoint,] the deal is no longer unthinkable and imminently do-able,” Precursor Group CEO Scott Cleland told us: “A lot changed in the last 7 years, and it would likely be approved.” But many complexities would need to be addressed and that could significantly slow down the regulatory approval.
Telecom Act revision should be legislation of few words and fewer regulations, BellSouth Chmn. Duane Ackerman told an American Enterprise Institute/Brookings Institution forum Tues. If Congress concludes competition between multiple facilities-based networks works better than traditional regulation -- which Ackerman believes it will -- telecom reform “could be dealt with in a very short bill in a matter of months, not years. This is not complicated.” Ackerman emphasized that telecom reform must be simple, to avoid lengthy litigation like that over the Telecom Act of 1996.
Wireline and wireless carriers alike opposed reseller TracFone Wireless’s request for universal service funding in N.Y., saying it would add pressure on the Universal Service Fund (USF) without benefits. But public interest groups said the entry of TracFone, which offers prepaid service, would help low-income consumers. TracFone had asked the FCC to give it eligible telecommunications carrier (ETC) status, needed to receive USF support, and to forbear from rules that require a carrier to have facilities of its own to receive that USF support.
House Commerce Committee ranking Democrat Dingell (Mich.) urged the FCC to reject “immediately” an AT&T petition asking that its enhanced prepaid calling card services be classified as interstate information services. In a letter to FCC Chmn. Powell last week, he expressed concern that “until the Commission acts, AT&T will continue its apparent practice of improperly withholding payments it should be paying into the Universal Service Fund (USF), as well as withholding appropriate payments of intrastate access charges.” In a petition filed more than a year ago, AT&T asked the Commission to rule that its “enhanced” prepaid calling card services were “interstate communications subject to interstate, rather than intrastate, access charges.” It also argued that services were information, rather than telecom services, because calling card users heard recorded ads when placing calls. Dingell called the claims absurd and said he was “troubled by the implications of the relief AT&T seeks.” He said ruling in AT&T’s favor would “upset the present balance which permits lower consumer phone rates,” because the company sought to “avoid its obligation to pay lawful intrastate access charges… on calls in which the calling and called parties are located within the same state.” He also urged the Commission to reject AT&T’s claims that its prepaid calling card services were information services, saying that granting such claims would “only free AT&T of any obligation to contribute to the USF in connection with these services” and create an “enormous loophole for other carriers to avoid supporting universal service.” Consumer Federation of America (CFA) Research Dir. Mark Cooper said in an interview CFA was “concerned” about AT&T trying to avoid paying access charges and USF contributions. “The FCC should make sure that everybody who benefits from the public switched network should make fair contributions to recover costs” of maintaining it, he said.
Even if it’s VoIP, telecom is “an essential public service” and local govts. will want to make sure reliable service is available to the public, said Marilyn Showalter, chmn. of the Washington Utilities & Transportation Commission. NATOA Pres. Coralie Wilson said govts. “simply cannot let technical standards lapse” just because of VoIP: “We need assurance the network will continue to operate.” Speaking on the same local govt. panel here, Neb. PSC Comr. Anne Boyle said “consumer protection goes beyond CALEA and E911.” She said VoIP providers need to comply with best practices, as well as with good customer service, and consumers are “who the government is there to protect.” At a later panel of FCC bureau chiefs, Wilson raised the question of mandating technical standards for new telecom services. He got little response, other than from Robert Pepper, FCC chief of policy development. Pepper indicated only that the Network Reliability & Interoperability Council would deal with such issues, and that the diversification of telecom into wireless and IP-based services increases diversity of the overall network. Local govt. officials spent much of their time talking about how to assure Universal Service Fund (USF) funding with the arrival of new technologies. Cal. PUC Comr. Susan Kennedy endorsed a per-number USF fee. Showalter agreed that’s probably “pretty reasonable,” though she said in the long term telephone numbers won’t be needed. Fla. PSC Comr. Charles Davidson, however, said USF “needs a business plan… It shouldn’t be a program that just expands and becomes a new tax.” Showalter suggested broadband will be necessary in the future and if people can’t afford it “government must assure that it gets there.” Kennedy, however, said Internet and video services “clearly” don’t qualify for USF. -- MF
Hours before the Senate took up legislation seeking to ban Internet access taxes, President Bush promoted the ban as a way to stimulate broadband deployment (see separate story, this issue). The Senate late Mon. was prepared to take a procedural vote as the first step toward consideration of S- 150 by Sen. Allen (R-Va.). S-150’s main opponent, Sen. Alexander (R-Tenn.), said Senate Majority Leader Frist (R- Tenn.) has been urging compromise for months, but said talks appeared to have failed: “We simply have a difference of opinion.”
Although Rep. Barton (R-Tex.) is mainly an energy expert, he could help lead the next overhaul of telecom regulations if he takes over the House Commerce Committee Feb. 16. Committee Chmn. Tauzin (R-La.) resigned Tues., effective that day, and said he wouldn’t seek reelection. Barton is widely regarded as front-runner for chairman, and he acknowledged Wed. he was seeking the job. He has a limited track record on communications, but sources -- and his own comments -- indicate he would be likely to push for comprehensive telecom reform in 2005.
The 9 Democratic candidates for President seldom, if ever, mentioned the term “UNE-P” on the campaign trail, nor are local phone competition issues addressed. While telecom policy isn’t a central issue in the candidates’ stump speech, universal broadband frequently is championed. Former Vt. Gov. Howard Dean (D) also sparked a great deal of attention with recent comments suggesting a need for telecom “re- regulation.” Retired U.S. Army Gen. Wesley Clark has vowed to eliminate NTIA and fold its essential operations into the Commerce Dept.’s Technology Administration.
The most important part of the FCC decision issued Mon. on what services are eligible for universal service support (CD July 15 p1) is what the Commission chose not to do, observers said, as did the Commissioners themselves in separate statements issued as part of the order. The FCC voted to defer action on whether “equal access” should be on the list of eligible services. Placing it on the list would have required competitors, such as those that provide wireless service in rural areas, to offer equal access service before they could be eligible for universal service, a move they opposed but rural ILECs supported.