All in Broadband
FCC Replaces Rate-Of-Return Competitive Overlap Process With Reverse Auction System
The Federal Communications Commission has approved and released a Report and Order and Further Notice of Proposed Rulemaking that revises many universal service fund rules that apply to rate-of-return incumbent local exchange carriers. Among other things, in the order the FCC replaces the existing overlap process that applies to legacy rate-of-return service areas that are served by unsubsidized competitors with competitive auctions.
Rate-Of-Return Broadband Order: FCC Eliminates Capital Investment Allowance, Simplifies Budget Control Mechanism, And Reduces Monthly Per-Line Limit On Support
The Federal Communications Commission has approved and released a Report and Order and Further Notice of Proposed Rulemaking that revises many universal service fund (USF) rules that apply to rate-of-return incumbent local exchange carriers. Among other things, the FCC’s order eliminates the capital investment allowance; simplifies the budget control mechanism calculation and eliminates the per-line reduction calculation that is part of the budget control mechanism; and reduces the monthly per-line limit on universal service support to $225 and then to $200.
FCC’s Draft Rural Broadband Order Attempts To Fix Inadequate Legacy USF Budget
The FCC has released a draft rural broadband order that will be considered at the FCC’s December open meeting. In the draft order, the FCC adopts a new universal service fund budget for rate-of-return carriers subject to legacy cost-based rules that is based on uncapped 2018 claims, increased annually by inflation. The increased budget comes with the condition that support recipients with deployment obligations provide broadband service at speeds of 25/3 Mbps rather than 10/1 Mbps.
A-CAM II: A New Model Offer for “Legacy” Rate-of-Return Carriers
The FCC has released a draft order that revises universal service fund rules that apply to rate-of-return incumbent local exchange carriers. In the order, the FCC offers model-based USF support to all rate-of-return carriers currently subject to “legacy” cost-based rules. The new model offer – A-CAM II –is similar to the original A-CAM offer but with several critical adjustments.
Draft Rural Broadband Order – New A-CAM Funding Offer Will Provide $200 Per Location, With Increased 25/3 Mbps Deployment Obligations
Federal Communications Commission Chairman Ajit Pai has released a draft rural broadband order that will be considered at the FCC’s December 2018 open meeting. Among other things, the draft order provides a new set of model support offers to rate-of-return carriers currently receiving Alternative Connect America Cost Model funding. The new offer provides support of up to $200 per location, per month, tied to an obligation to build out 25/3 Mbps broadband service to additional locations.
FCC Approves Transaction Involving Cost-Based and A-CAM Rate-of-Return Companies
The FCC has approved the transfer of control of ComSouth Corporation to Hargray Communications Group, Inc. The transaction involves high-cost universal service fund support provided under two different mechanisms – one fixed and one cost-based. Because the FCC found this situation raises cost shifting concerns that could unfairly increase USF support, it approved the transaction subject to a condition intended to prevent such a result.
