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After Changes, FCC Approves Rural Digital Opportunity Fund For More Than $20 Billion

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FCC Chairman Ajit Pai and the commissioners at the January 30th commission meeting by Adrienne Patton

WASHINGTON, January 30, 2020 – The Federal Communications Commission voted in favor of the Rural Digital Opportunity Fund on Thursday in spite of concerns voiced from the democratic commissioners Jessica Rosenworcel and Geoffrey Starks.

The Rural Digital Opportunity Fund, the successor to the Connect America Fund, and is a decade long initiative to allocate $20.4 billion to closing the digital divide in rural areas that have no broadband access or scattered service.

The fund is split into two phases. The first phase will use the majority of the funds to provide 25/3 Megabits per second (Mbps) broadband speeds (25 down and 3 up) to nearly six million homes and companies that have no access.

Phase one will use $16 billion to serve rural Americans through a multi-round reverse auction.

The second phase, using $4.4 billion including any remaining funds from the first phase, targets partially served census blocks where some homes do not have 25/3 Mbps broadband access.

Chairman Ajit Pai boasted the Rural Digital Opportunity Fund as the “biggest step the FCC has ever taken” to bridge the digital divide and provide digital opportunities to unserved Americans.

Among the key developments discussed at the agency’s open meeting were changes to the letter of credit requirement. Consequently, carrier costs will be reduced nearly 80 percent and is likely to incentivize bidders.

Criticism of Pai’s approach by the Democratic commissioner Rosenworsel

Rosenworcel and Starks voted to approve in part and dissent in part. Both expressed concerns that the funds will not be used in the best interest of the American people because of flaws with the agency’s broadband maps.

She described the FCC’s maps as “notoriously inaccurate” and said that the digital divide cannot be addressed without an accurate broadband map.

Before using billions in funds, the FCC needs to know where there is and isn’t service, said Rosenworcel. She called the new initiative a “broadband publicity stunt,” advocating for a thorough, data driven approach.

Rosenworcel said she worried that many people will be left without service while the FCC exhausts 75 percent of its funds. “We need maps before money, and data before deployment,” she said.

She also urged “ambitious” approaches to balanced download and upload speeds and addressing broadband cost and adoption barricades.

Pai defended the need to promote rural broadband funding now

Asked in the press conference to comment on the inaccuracy of the mapping, Pai said the FCC knows there are people who do not have broadband access but are counted on the maps as being “served.” But he also said he would not stall any longer to address the digital divide.

Countering this statement to the press, Rosenworcel said this was a hasty move to push out funds on an election year. “This feels sloppy,” said Rosenworcel.

Starks voiced his concern that the FCC is sidestepping the states’ efforts to deploy broadband. He mentioned that members of Congress have expressed concern and asked to postpone the vote. The FCC has not tried to examine how the state initiatives are already in action, said Starks.

Concerned at the vague language, Starks said the states were not aware that the areas served by state subsidies would be precluded from the Rural Digital Opportunity Funds. Starks and Rosenworcel were disappointed at this change.

Starks said the FCC “should have taken the time to get this right.” He encouraged taking the time to develop correct maps, affordable broadband service, and holding providers accountable to meet set milestones.

Commissioners Michael O’Rielly and Brendan Carr approved fund

O’Rielly said nearly 8.4 million Americans do not have 10/1 Mbps broadband service. O’Rielly acknowledged the benefit of fiber-based broadband, but said the FCC cannot focus on improving areas that are already served.

The areas that are difficult to serve cannot be left behind, said O’Rielly.

Carr said the digital divide had been ameliorated by about 20 percent in 2019. He touted the merits of the Rural Digital Opportunity Fund to boost 5G infrastructure and aid communities that have no service or only dialup.

Agency officials said auctions for the Rural Digital Opportunity Fund would take place later this year.

FCC

FCC Encouraged to Limit Data Collection on Affordable Connectivity Program, Others Want More

One trade group warns about providers leaving the program if data collection too onerous.

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Photo of Jonathan Spalter, CEO of US Telecom, from ISE

WASHINGTON, August 9, 2022 – The Federal Communications Commission is being warned not to overly burden internet service providers with its Congress-mandated order to collect pricing and subscription rates data from participants in the Affordable Connectivity Program.

Under the Infrastructure, Investment and Jobs Act, the FCC is required by November 15 to adopt rules to collect annual data relating to the price and subscription rates of each internet service offering by a provider participating in the broadband subsidy program, which offers up to $30 per month for low-income households (up to $75 per month on tribal lands) and a one-time $100 off a device.

But a number of submissions are warning the FCC against rules that require any additional data collection efforts beyond the scope of the law so as not to unduly burden providers and, at least one other trade group said, push providers away from participating in the program.

Telecommunications company Lumen, for example, recommended the commission limit the scope of the annual reporting to monthly pricing and to exempt “excessively granular” requirements, such as promotional rates, grandfathered plans, or subscriber-level data, which the commission is proposing to collect.

Communications companies and industry groups want to limit data collection

T-Mobile said in its submission that Congress told the FCC to rely on the broadband consumer labels, which are due this November, for pricing. The commission asked for comment on the interpretation of the IIJA requiring a reliance on price information displayed on the consumer labels.

For subscription information, T-Mobile urges the commission to look at data collection from the Universal Service Administrative Company – which administers high-cost broadband programs for the Universal Service Fund – to avoid “adopting a largely redundant collection that would impose additional burdens” on all parties.

“The IIJA leaves the Commission no discretion to collect any additional price information, and the statute does not require collection of data on other service plan and network characteristics,” such as speed and latency and data allowances, the submission said.

“Collection of this additional data would create additional burdens and is unnecessary,” the submission added.

Similar limitations were also proposed by telecom Starry Inc., which pushed for privacy protection by collecting data at a higher level (such as the state) and working with information collected in other transparency efforts, such as the consumer labels.

Industry association IMCOMPAS, which represents internet and competitive communications networks, told the FCC in a submission that data collection should be limited to the state level to protect consumer privacy and proprietary information of the providers; streamline other data collection, including the consumer labels; and provide instruction on how to providers to better understand the data collection rules.

Concurring with this position is the Wireless Internet Service Providers Association, which said data collection must be simple and should not go to a level of detail that goes beyond what the IIJA calls for. The trade group, which represents small providers, said such data collection beyond that required in the law could burden companies with small teams.

The included data, WISPA said, should be an annual aggregate of items including broadband plans subscribed to by ACP customers, number of subscribers for each plan, and pricing minus promotional rates, taxes, discounts or pricing breakdowns for bundled services. Any additional onerous collection could see providers leave the program, it added.

Industry groups US Telecom and NCTA – Internet and Television Association similarly urged a simple annual report that captured undiscounted monthly pricing of each broadband service offering and the number of customers subscribed. The Competitive Carriers Association and the Cellular Telecommunications and Internet Association also recommended a limited data collection approach.

ACA Connects, a trade group representing small and medium-sized independent operators, said the FCC should direct providers to report numbers of ACP households “that are applying their benefit to each speed tier along with the standard price of each tier on a state-by-state basis” – rather than the FCC-proposed continuous collection of subscriber-level data via the National Lifeline Accountability Database, it said, adding the commission should be mindful of the time it takes for completion, as smaller providers have limited resources.

Others pushing for subscriber-level, more data

The cities of New York and Seattle, in their submissions, said the FCC should collect subscriber-level information to assess different service adoption rates on different plans over time – publishing categories based on price, plan and performance by the zip code. It added it is not seeking information about the households itself, and said this would not be a privacy concern as others have pointed out.

Similarly, the Connecticut Office of State Broadband said the commission should go beyond the IIJA requirements by mandating information including performance of the plans and whether a device is offered.

For the National Digital Inclusion Alliance, data collection on the ACP should include data beyond what’s included in the consumer labels, and should include other items such as installation, equipment, service, miscellaneous, data and usage fees, and state and local taxes.

In a joint submission, non-profit media group Common Sense and internet advocacy group Public Knowledge recommended data collection that is necessary to monitor the ACP, which include promotional rates, taxes, overage costs and device and equipment costs. This way, they say, the FCC can get a better idea of how much is going toward internet access after applying the subsidy. They are also asking for the commission to collect information on whether the subsidy is being used to upgrade or discount current service, and how customers are becoming aware of the program.

The commission is currently trying to get more Americans on the program, which has over 13 million households signed up. That number, the commission said last week, should be much higher. As such, it ordered the development of an outreach program to market the subsidy.

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FCC

Former Commissioners Commend FCC in Absence of Fifth Commissioner

But there’s concern a Senate vote on a fifth FCC commissioner will not happen before midterms.

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Screenshot of Former FCC Chairman Richard Wiley

WASHINGTON, July 25, 2022 – Former chairs of the Federal Communications Commission commended the current FCC administration at a symposium on Wednesday for working together on important issues with a 2-2 party split, but expressed increasing uncertainty about the fate of a fifth commissioner.

The Senate vote to confirm Gigi Sohn, a Democrat and net neutrality advocate, has stalled for months. And former FCC commissioners were wary of her prospects before the midterm elections in November. Some Republican critics are concerned that Sohn, nominated by President Joe Biden in October, won’t be able to remain non-partisan on the issues she would encounter as a commissioner.

“Confirmation is still possible, but with the extended August recess and looming midterm election, there aren’t a lot of legislative days to get the job done,” said former FCC Chair Richard Wiley. With each passing day, the confirmation becomes more difficult, agreed panelists, as the Senate could flip to a Republican-controlled chamber come November.

In the meantime, the former commissioners praised the efforts of the current staff. “A lot of credit should go to the Chairwoman [Jessica] Rosenworcel and indeed to all the commissioners for maintaining a robust agenda over the last year and half and really getting decisions made,” said Wiley. “Two Democrats, two Republicans have worked together to serve the public interest.”

William Kennard added that, “this is an energetic commission, they want to get things done.”

Some initiatives that have received unanimous FCC votes include spectrum-sharing initiatives and robocall enforcement.

Editor’s note: The comments in this story were quoted from and attributed to a July 20, 2022, symposium. That symposium was hosted by the Multicultural Media, Telecom and Internet Council. 

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FCC

FCC Adopts Spectrum-Sharing Incentives, Proposal on Call Traffic Arbitrage

The agency voted to incentivize the sharing of underutilized spectrum to increase connectivity in the nation.

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Photo of Nathan Simington, Brendan Carr, Jessica Rosenworcel of FCC (left to right)

WASHINGTON, July 14, 2022 – The Federal Communications Commission voted at its July open meeting Thursday to adopt spectrum-sharing incentives and to crack down on the practice of driving up revenue from call traffic inflation.

The commission voted to adopt a program that will build incentives for larger spectrum holders to make underutilized spectrum available to smaller carriers, tribal nations and entities serving rural areas. The program, called the Enhanced Competition Incentive Program, will have incentives including longer license terms, extensions on buildout obligations, and more flexible construction requirements.

The commission is also seeking comment on whether to expand the program eligibility to non-common carriers serving non-rural areas.

“I’m excited to see the new deployments this program will foster,” said FCC Chairwoman Jessica Rosenworcel. “I think it will help expand wireless deployment in rural and tribal communities… to make sure we reach 100 percent of us with high-speed service.”

Experts have advocated for more carve-outs for unlicensed spectrum to tackle the growing demand for connections and relieve congestion on existing frequencies. The Rural Wireless Association applauded the FCC Thursday on the vote, saying it believes that program can “encourage the necessary transactions that can expand telecommunications and broadband service in rural America.”

Cracking down on call traffic arbitrage

The commission also proposed rules to address the practice of telephone companies inflating traffic to generate more revenue, which raises costs for long-distance carriers.

Intercarrier compensation is the system of regulated payments that sees carriers compensate each other for cross-carrier call traffic. Some companies, however, continue to take advantage of the system by inflating traffic to extract additional revenues, the FCC identified. As a result, the FCC proposes to adopt monitoring rules to identify illegal arbitrage practices.

“This rulemaking is designed to shut down the loopholes these companies are exploiting,” said Rosenworcel. It would require providers to tally and report call traffic volumes to the FCC to verify its compliance with access stimulation rules, which were adopted in 2019 to clarify financial responsibility for calls.

Other actions

The FCC also proposed a $116 million fine against ChariTel Inc. for a robocall scheme that made nearly 10 million robocalls to toll-free numbers, which then generated revenue for the company from payments by the toll-free service provider.

FCC commissioners further voted to open an inquiry to evaluate how the Lifeline and Affordable Connectivity Program can be modified to support the connectivity needs of domestic abuse survivors.

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