FCC

In Partisan Vote, FCC Passes a Modified E-Rate Proposal for Spending Funds on Wi-Fi Connectivity

Published

9 years ago

July 15, 2014

WASHINGTON, July 15, 2014 – The Federal Communications Commission on Friday voted to modernize of its E-Rate program Friday, reallocating funds from technologies considered obsolete to Wi-Fi based connectivity in schools and libraries. However, owing to strong skepticism from opponents over funding, the proposal was scaled back to $2 billion, down from its original $5 billion.

The 3-2 vote came when FCC Chairman Tom Wheeler secured support from the other two Democratic-appointed commissioners. But Republican-appointed Commissioners Ajit Pai and Michael O’Rielly dissented.

Wi-Fi versus Broadband Connectivity

Previously, education groups like National Association of Federally Impacted Schools and the National Education Association had criticized the proposal for leaving rural and suburban schools with no funds for basic internet connectivity, sometimes referred to as Priority I services. The final proposal agreed that funds for Wi-Fi and internal connections, called Priority II service would not be funded at the expense of Priority I services.

“Part of the problem is [our schools] are not all totally hooked up to the point where they can even consider Wi-Fi or modernized things to do with the Internet,” said NAFIS Executive Director John Forkenbrock.

In past years, nearly 50 percent of the FCC’s $2.4 billion E-Rate funds went to non-broadband legacy services including paging, email and voice service. Opponents to the proposal – among both educators and Republicans –questioned whether cutting back on these services would be sufficient to fund a new E-Rate Wi-Fi program for as many as five years.

Even with the reduced proposal budget of $2 billion from 2016 to 2018, Pai and O’Rielly blasted the agency’s Wi-Fi spending. Both said that some of the $2 billion for Wi-Fi would have to be collected through higher fees on phone bills.

“It always seems to be easier for some people to take more money from American people via taxes and fees, rather than do the hard work,” O’Rielly said. “If more money is justified for E-Rate, let’s dig in and find offsets, not stick it to hardworking poor and middle-class Americans.”

The Need for E-Rate Reform

Democratic-appointed Commissioner Jessica Rosenworcel took the opposite view: not enough of the proposed funds are being allocated toward Wi-Fi. She called for increased annual funding overall to meet the demand that is roughly double the E-Rate’s expenditure.

“We can’t expect to compete if we educate the next generation with a support system frozen in the age of dial-up,” said Rosenworcel.

NEA President Van Roekel said the FCC was right to not hastily alter the fundamental structure of the E-Rate program without guaranteed funding. He said that more needs to be done in the long term.

“If we are serious about ensuring equity in our schools, all the demand for ongoing internet connectivity must be met—especially in high-needs schools,” Roekel said. “Shifting our goals to establish Wi-Fi in targeted school districts, without increasing the cap, could undermine the historical importance and significance of the E-Rate Program.

Similar sentiments were shared by Sen. Edward Markey, D-Mass., who said that “while the need to promote Wi-Fi in all schools and libraries is more important than ever, it should not come at the expense of bringing broadband to the brick and mortar building itself. To truly ensure our students and the public can best compete in our interconnected 21st century economy, the FCC must still take action to increase the program’s permanent funding cap.”

But at Friday’s meeting, Wheeler said that significant change to the program was necessary.

“No responsible business would stick with an information technology plan developed in 1998,” Wheeler said. “We owe the same rigorous self-examination to our schools and libraries.”

Significant Criticism Preceded Vote

In the lead up to the agency vote on Friday, more than a dozen education advocacy groups wrote the FCC a joint statement saying that the proposed changes “will only dilute an already over-subscribed E-Rate program.” While “nominal savings may be realized by eliminating legacy services,” it doesn’t guarantee additional funding.

In particular, NAFIS took issue with Wheeler’s proposal to take funds from Priority I internet access and shift them to Priority II internal connections and wireless internet.

Wheeler’s previous proposals could have imposed harm if it had phased down support for the internet access portion of Priority I services, said Mary Kusler, who heads the government relations department at the National Education Association.

“For 18 years this has been an incredibly successful program. However, for the past 18 years, there has been over $5 billion worth of applications” every year, she said, ”so we’ve essentially had double the requests for discounts than money available. What we see in [Wheeler’s] proposal is an attempt to divert the attention away from that connectivity point to this idea of ensuring Wi-Fi access…and while Wi-Fi is certainly a piece of the puzzle, we are very concerned that it’s really only connecting those that already have connectivity.”

Aspen Institute fellow Blair Levin expressed much greater optimism about modernization in a blog post with the Benton Foundation. He said funding for old legacy services constitutes roughly $1.2 billion of E-Rate spending and would be a significant source of cost saving.

The Universal Service Administrative Corporation estimated that it committed $9.8 million for email services and almost $28 for web hosting in the funding year 2011. Another $934,000 that same year went to paging services in response to more than 500 E-Rate requests despite the technology being viewed as obsolete today. Another 100 requests called for $95,000 in funding commitments to dial-up services.

Considerably more savings can be seen by phasing down support for telephone services, said Kusler, calling it a “double edged sword.” Although it will allow more money to be devoted to internet connectivity, “at the same time, it’s a fixed cost at the local level that is not gonna go away. So if school districts start having to pay their full share of telephone bills, they’re going to have to make up that funding somewhere else.”

Levin added that another major source of cost savings will come through programs like “volume discounts through consortia-enabled bulk purchasing, and improved pricing transparency.”

In the lead up to Friday’s meeting, Sens Jay Rockefeller, D-W.V., and Markey warned that a per-student or square foot distribution method for Wi-Fi could result in a sub-optimal solution.

“As the founders of the E-Rate program, we applaud your commitment to schools and libraries across the country. Nothing short of our international competitiveness and children’s future are at stake with E-Rate modernization. That is why it is so important for you to take the time necessary to get this right.”

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In Lead-up to July’s FCC Meeting, Agency Laid Groundwork for Supportive Vote on E-Rate Changes

Marcus Hedenberg

Marcus Hedenberg is a reporter for Broadband Breakfast News.

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Digital Inclusion

Broadband Association Argues Providers Not Engaged in Rollout Discrimination

Trade group says telecoms are not discriminating when they don’t build in financially difficult areas.

Published

1 week ago

September 18, 2023

Hanna Agro

Image of redlining from historic map of the Home Owners’ Loan Corporation of Richmond, Virginia, from PBS.

WASHINGTON, September 18, 2023 – Broadband association US Telecom sent a letter to the Federal Communications Commission last week saying internet service providers don’t build in certain areas because it is financially difficult, not because they are being discriminatory.

The FCC proposed two definitions of digital discrimination in December 2022: The first definition includes practices that, absent technological or economic constraints, produce differential outcomes for individuals based a series of protected characteristics, including income, race, and religion. The second definition is similar but adds discriminatory intent as a necessary factor.

“To make business determinations regarding capital allocation, an ISP must consider a host of commercially important factors, none of which involve discrimination,” said the September 12 letter from USTelecom, which represents providers including AT&T, Verizon, Lumen, Brightspeed, and Altafiber.

“As the Commission has consistently recognized, such deployment is extremely capital-intensive…This deployment process is therefore subject to important constraints related to technical and economic feasibility” added the letter.

US Telecom explained that ISPs’ will choose to invest where they expect to see a return on the time and money they put into building broadband.

The association added that factors like population density, brand reputation, competition and the availability of the providers’ other services all go into deciding where broadband gets deployed.

“The starting point of the Commission’s approach to feasibility should be a realistic acknowledgement that all ISPs must prioritize their resources, even those that invest aggressively in deployment,” added the letter.

The association also highlighted the fact that it hopes to see as little government intervention in broadband deployment activity as possible, a concern that has been echoed by lobbyists before.

“Rather than attempting to use Section 60506 to justify taking extra-statutory intrusive actions that could paradoxically undermine ongoing broadband investment, the Commission must enable ISPs to make decisions based on their own consideration of the kinds of feasibility factors discussed above” read the letter.

Section 60506 of the Infrastructure, Investment and Jobs Act says that the FCC may implement new policies to ensure equal access to broadband.

The FCC is also looking to develop guidelines for handling digital discrimination complaints filed against broadband providers.

USTelecom said that ISPs should be allowed to demonstrate financial and logistical concerns as a rebuttal to those claims, in addition to disclosing other reasons for directing investment elsewhere to demonstrate non-discriminatory practice.

Reasons for investment elsewhere would include rough terrain, low-population density, MTE owners not consenting to deployment, zoning restrictions, or historical preservation review.

“To aid in the success of the Infrastructure Act and facilitate equal access, the Commission must continue to foster an environment conducive to ISP investment in the high-speed broadband infrastructure that Congress rightly views as central to our connected future,” concluded the letter.

FCC Comments

CAF II Auction Recipients Push FCC to Extend Letter of Credit Waiver, Relax Restrictions

The agency proposed a shorter, more restrictive waiver.

Published

2 weeks ago

September 14, 2023

Jake Neenan

Photo of $100 bills

WASHINGTON, September 14, 2023 – Internet service providers who received project funding under the Connect America Fund Phase II Auction are asking the Federal Communications Commission to continue waiving their letter of credit requirements.

The FCC requested in August comments on a proposal to extend the waiver for one year — through December 2024 from the current December 31, 2023 date — and limit it to providers who have filed all location reports on time and have finished at least 60 percent of the total locations they agreed to build in each state. In 2020 the FCC waived the letter of credit requirements — requiring a cash collateral on agreements for risk assessment — for auction recipients in response to the pandemic, allowing them to comply with the less restrictive Rural Digital Opportunity Fund letter of credit rules.

Without the waiver, providers would need to secure letters of credit for all support they had previously received, plus the money they are slated to receive in the coming year. The waiver reduces that requirement to a single year of funding if providers build infrastructure at the agreed upon pace.

Auction recipients, through the Connect America Fund Phase II Coalition, pushed back on both conditions in a filing to the FCC dated Monday and asked for a two-year extension on the waiver, citing long-term economic effects of the pandemic and rising interest rates. That would keep the waiver in place until December 31, 2025, the entire remaining build timeline.

The coalition asked for a lighter deployment threshold, 57 percent of a provider’s obligated locations rather than 60. It also pushed the FCC to include providers who have missed a filing deadline in the waiver, calling the “one strike and you’re out” proposal “disproportionate,” the filing said.

The CAF II auction provided in 2018 nearly $1.5 billion for providers to build out network infrastructure in areas that are expensive to serve. Recipients of funds under the auction are not required to provide broadband speeds, with a minimum requirement of 10 Mbps upload and 1 Mbps upload.

RDOF, which concluded a similar reverse auction in 2020, has allocated over $9 billion for the same purpose, with up to $11.2 million available for a second phase.

Future auctions are in jeopardy, though, as providers defaulted on nearly $3 billion of the initial award. Those that have not defaulted are pressing the FCC for more funding.

More than 300 people in the broadband industry asked the National Telecommunications and Information Administration to remove the requirement for the upcoming $42.5 billion BEAD grant program, arguing it prevents smaller providers with less capital on hand from participating.

FCC

Senate Approves Anna Gomez as Fifth Federal Communications Commissioner

The Democrat-held Senate voted 55-43 in favor of Biden’s second nominee for the spot, after Gigi Sohn withdrew.

Published

3 weeks ago

September 7, 2023

Hanna Agro

Photo from the National Hispanic Caucus of State Legislators.

WASHINGTON, September 7, 2023 – The Senate voted Thursday to approve Anna Gomez as the fifth commissioner of the Federal Communications Commission, finally completing the panel and breaking the party deadlock in favor of the Democrats.

The Democrat-held Senate voted 55-43 in favor of President Joe Biden’s May nomination.

The vote breaks the almost two-and-a-half year delay in filling the last commissioner seat after the FCC was stuck in a deadlock.

Gigi Sohn, an internet advocate and co-founder of Public Knowledge, was originally nominated for the fifth commissioner in October 2021, but stepped down earlier this year, citing “dark money political groups” tainting her career. She had been in front of the Senate commerce committee three times about her nomination, with Republicans accusing her of being partial on the relevant issues.

“Congratulations to Anna Gomez on her confirmation by the United States Senate,” FCC Chairwoman Jessica Rosenworcel said in a statement. “Anna brings with her a wealth of telecommunications experience, a substantial record of public service, and a history of working to ensure the United States stays on the cutting edge of keeping us all connected.

“Her international expertise will be a real asset to the agency. I look forward to working with her to advance the agency’s mission to ensure the benefits of modern communications reach everyone, everywhere and that the United States can continue to lead in the digital age,” Rosenworcel added.

Positive comments poured from organizations including Free Press Action, America’s Communication Association, and Competitive Carriers Association.

“CCA is enthusiastic about collaborating with Commissioner Gomez and a full Commission to address the evolving challenges and opportunities in the rapidly changing wireless landscape” said CCA president and CEO Tim Donovan in a statement.

Chris Lewis, CEO of Public Knowledge, offered his congratulations to the new commissioner. “We are excited for the diversity and experience Ms. Gomez brings to the agency.”

Gomez served as a senior advisor for international information and communications policy in the State Department’s Bureau of Cyberspace and Digital Policy. She served as the National Telecommunications and Information Administration Deputy Administrator from 2009 to 2013 and spent over a decade in various positions at the FCC.

Current commissioners Geoffrey Starks and Brendan Carr were also nominated by Biden in May but have yet to get Senate votes. Starks must be voted in before the end of the year or he must resign; Carr can serve throughout 2024 without reconfirmation.