The FCC Wireline Bureau invited nominations by Aug. 17 to occupy 12 board seats on Universal Service Administrative Co., a public notice in docket 96-45 said Thursday. Board members have fiduciary duties to protect the interests of USAC -- which administers USF programs for the FCC -- consistent with federal and state laws. The list includes six seats with terms that expired Dec. 31, 2013, and six that expired Dec. 31, 2014, but all but one of the seats are currently filled, the PN said. The FCC already solicited and received nominations for the first six but is seeking any new nominations to refresh the record, while it's seeking nominations for the second six for the first time. The slots to be filled are for representatives of Bell operating company ILECs, non-Bell ILECs with less than $40 million in annual revenues, libraries eligible for E-rate discounts, state consumer advocates, mobile wireless providers, cable operators, schools eligible for E-rate discounts (two slots), low-income consumers, CLECs, rural healthcare providers eligible to receive USF support and interexchange carriers with annual operating revenue of $3 billion or less.
A federal court took a short timeout from its briefing schedule so it can consider an FCC motion to suspend substantive judicial review of an AT&T challenge to a commission order on price-cap telco USF duties, pending regulatory action on related issues in other proceedings. The U.S. Court of Appeals for the D.C. Circuit Thursday granted an FCC request to file the motion to hold the case in abeyance and the court suspended its current briefing schedule. The court didn't rule on the FCC motion to hold the case in abeyance, which already has been submitted. In its motion, the FCC noted that AT&T and others in August had asked the FCC to relieve price-cap carriers of eligible telecom carrier (ETC) obligations to serve rural areas where they would no longer be subsidized if they elected to receive USF support under the agency’s Connect America Fund Phase II overhaul of the high-cost program. AT&T and others also had urged the FCC to permit, but no longer require, high-cost ETCs to participate in the Lifeline USF program subsidizing low-income telecom consumers. Separately, in October, USTelecom petitioned the FCC to forbear from applying related high-cost and Lifeline rules. The FCC in December partially granted USTelecom’s petition, relieving price-cap carriers of their ETC duty to offer voice service in census blocks determined to be “low-cost,” served by an unsubsidized competitor, or where a competing ETC is receiving USF support to deploy fixed broadband/voice networks. AT&T then challenged the FCC order in the D.C. Circuit, arguing it didn't provide enough relief and was arbitrary and capricious (AT&T v. FCC, No. 15-1038). But the commission motion said that the agency made clear in December it wasn’t addressing all the issues raised in USTelecom’s petition or by commenters in the high-cost and Lifeline proceedings -- all three of which remain open. The FCC thus asked the court to hold the case in abeyance until (a) the agency finalizes its USTelecom forbearance review -- which must occur by Jan. 4 -- or earlier if it acts on the high-cost and Lifeline issues AT&T is targeting; and (b) AT&T petitions for review of the resulting orders, assuming it does so. The FCC said its prospective actions in the open proceedings could moot or alter AT&T’s current challenge, and even if they don’t, it made more sense for the court to consider all the issues at one time, rather than piecemeal. AT&T Tuesday opposed the FCC motion. “There is no reason for delay,” the telco said. “At bottom the FCC promulgated a rule it knows it cannot defend,” AT&T said. “That the FCC might, in a future order, grant AT&T relief from [unlawful] obligations is no reason to hold the case in abeyance.”
USTelecom is calling on the Wireline Bureau to tightly control its E-rate USF support program as it implements FCC changes allowing schools and libraries to self-provision fiber/broadband networks in certain circumstances. The bureau should confirm that school and library self-provisioning “should be the option of last resort” and take other steps to ensure proper E-rate funding allocation, including through continued use of copper phone networks, USTelecom said in reply comments filed last week in docket 13-184 on a proposed list of services eligible for E-rate discounts.
The FCC Enforcement Bureau settlement with TerraCom and YourTel America Thursday "highlights the problem of making policy through enforcement actions," said Commissioner Mike O'Rielly in a statement later that day. The companies agreed to jointly pay a $3.5 million civil penalty and take actions to improve their data security practices, as part of a bureau order and consent decree to resolve an investigation of possible Lifeline USF customer privacy violations (see 1507090035). YourTel also agreed to improve its compliance with Lifeline eligibility and de-enrollment rules. "I am certain that attempts will be made to cite the Consent Decree as precedent for an entire industry even though it was the product of company-specific negotiations," O'Rielly said. "Other interested parties had no opportunity to comment at any point in time on the substance of the Commission’s claims or legal theories, but will now be forced to embrace the product of a closed and slanted process that will be portrayed as consensus practices and rules."
FCC Commissioner Mignon Clyburn dismissed the notion Internet access is not a necessity when she addressed the National Action Network Wednesday in a speech that appeared to answer comments made recently by Commissioner Mike O'Rielly, who disputed that Internet access is a necessity (see 1506250035). Clyburn said the FCC is looking to update its voice-oriented Lifeline USF support program for the digital age. "But let me warn you, any proposed transition will not come easy, for there are those who publicly proclaim that Internet access is 'not a necessity'!" she said, according to her remarks as prepared for delivery. "Not a necessity … during a time when the majority of Fortune 500 companies post new job listings strictly on websites? And where if you are fortunate enough to secure a position, your new boss expects you to have an e-mail address? Not a necessity … where, in a growing number of states, those who are income-eligible can only apply for benefits or aid online? Not a necessity … when most colleges and universities post and accept student admissions electronically? Not a necessity … as the evidence grows daily, on how technology is bridging long-standing gaps when it comes to the delivery, quality of service, and cost efficiencies for access to health care and wellness? And when you make that face-to-face appointment or conduct business in person, when was the last time you bought or referred to a folded map when you traveled to that destination?"
TerraCom and YourTel America will pay a $3.5 million civil penalty and take remedial steps to resolve an FCC investigation into whether the companies failed to protect the confidential personal information of more than 300,000 consumers applying for Lifeline USF service, under an Enforcement Bureau order and consent decree released Thursday. The settlement also resolves an investigation into whether YourTel violated FCC rules by failing to de-enroll subscribers for Lifeline low-income support in a timely fashion after being ordered to do so by the Universal Service Administrative Co. Both companies admitted to violating FCC rules.
FCC Enforcement Bureau letters notifying Icon Telecom and Oscar Enrique Perez-Zumaeta of their suspension from participating in the Lifeline USF program are to be published Thursday in the Federal Register, said two FR notices including the letters (here and here) posted Wednesday. The letters, which also give notice of the commencement of debarment proceedings against Icon and Perez-Zumaeta, were dated May 26 and June 8, respectively, and released at the time by the FCC (see 1505260027 and 1506080067), but the parties have 30 days to contest the suspensions upon receipt of the letter or publication of the suspension in the Federal Register, whichever comes first. Icon, a Lifeline participant, pleaded guilty "to knowingly making a false statement to the Universal Service Administrative Company through its submission of 58 fabricated customer recertification forms," the bureau said in its letter notifying Icon. In April, Wes Yui Chew, president and owner of Icon, was ordered to serve four years in federal prison and pay a fine of $117,166 after pleading guilty to money laundering for transferring $20.5 million from an Icon bank account to his own, "despite knowing that Icon had thousands fewer customers than it reported to the Commission," said the bureau in a separate letter notifying Chew of his own suspension (which was not part of Wednesday's FR notices). Chew also agreed to forfeit $27 million seized during a Department of Justice investigation. Perez-Zumaeta owned and managed PSPS Sales, which recruited low-income people to apply for Lifeline-supported phone services through Icon. He pleaded guilty to money laundering for depositing a $52,390 check from Icon into a PSPS bank account "despite knowing that more than $10,000.00 of those funds was the result of criminal fraud against the Commission," the bureau said in its letter to Perez-Zumaeta.
The FCC is likely to expand Lifeline USF support to broadband and could establish a budget for the program serving low-income consumers, panelists said Wednesday on a webinar hosted by Ball State's Digital Policy Institute. Finding a compromise that exerts fiscal control while allowing low-income consumers to benefit was seen by some panelists as key to obtaining a unanimous vote among commissioners -- who were divided 3-2 along partisan lines on issuing an NPRM in June (see 1506180029) -- though panelists had mixed assessments of the prospects. Some speakers also said the FCC was likely to relieve telecom carriers of responsibility for determining consumer Lifeline eligibility and voiced hope the process could be streamlined by shifting oversight to state agencies already administering other federal low-income programs such as food stamps and Medicaid.
The FCC is actively encouraging fiber deployment to boost broadband capabilities, spur competition and facilitate innovation, said Gigi Sohn, counselor to Chairman Tom Wheeler, in prepared remarks Tuesday at Fiber to the Home's Fiber on Fire conference in Anaheim. "Fiber networks lead to an influx of business, resources, jobs, and consequently, economic growth," she said. "On top of the economic benefits, broadband enhances health care, education, energy use, environmental protection, public safety, transportation, civic engagement, you name it." Sohn said that fiber-driven advances improve U.S. competitiveness overseas and broadband competition domestically. Citing many consumers' slow data speeds, she noted that the FCC increased the baseline speed for "broadband" from 4/1 Mbps to 25/3 Mbps. The agency is "working to help lift barriers to broadband deployment" by taking steps to foster wireless backhaul, better align the costs of using poles and conduits, and pre-empt state laws restricting community broadband, she said. Local and industry deployment efforts "are even more exciting," she said, and they often spark competitive responses. "If our efforts to lift barriers are not enough and if the efforts of communities across the country don’t reach far enough, rest assured, the FCC is taking more steps to incentivize fiber deployment. We need to make sure that all Americans will reap the benefits of fast broadband speeds." She cited the FCC decision to allocate $10 billion in USF support over six years to extend broadband in high-cost areas currently served by price-cap telcos; if the carriers decline funding in a state, others, including municipal systems and electric cooperatives, will be eligible for the funding, she noted. Sohn said the commission is promoting fiber deployment through the E-rate program subsidizing school and library communications.
The U.S. wireless industry is “more vibrant and vigorously competitive than ever before” and the FCC should recognize that in its next wireless competition report, CTIA said in comments. Other industry commenters offered the same take in docket 15-125. But industry observers told us they see little chance the FCC will change course and agree with them. The first seven wireless competition reports didn't include any conclusions on whether the industry was effectively competitive, though the next six reports concluded it was. All reports since 2010 have not drawn a conclusion.