The Federal Communications Commission yesterday issued a notice of proposed rule making (NPRM) with the goal of creating the broadband mobility fund originally proposed in the National Broadband Plan (NBP).
If formalized as proposed, the fund would provide the FCC with its first opportunity to use a reverse auction for awarding Universal Service Funds (USF) to carriers—an idea that has been kicked around for several years and which the current commission seems to favor.
The NPRM seeks to provide funding to wireless carriers on a one-time basis to deliver “current-generation or better mobile wireless service” for areas that currently do not receive 3G. The reverse auction process would award funds to the carrier that requests the smallest amount of funding. As part of the NPRM the FCC also seeks to identify areas where 3G service is not available and seeks comment on whether to make support available to any unserved area or to target support only to limited areas. Comment is also sought on what minimum performance and coverage requirements should be required for any winning bidder.
The NPRM differs from what was originally proposed in the NBP in one important respect. Although the NBP only talked about supporting 3G service, the new proposal opens the door for a carrier to obtain funding for a 4G network. Verizon has argued that some unserved areas will likely move directly to 4G—and apparently the FCC found validity in that argument, although everyone doesn’t agree with the 4G provision.
The cost of the proposed program is between $100 million and $300 million, which would come from the USF. The FCC says that money is now available because Verizon Wireless and Sprint have voluntarily relinquished funding they could have received through the competitive eligible telecommunications carrier (CETC) program. That program has drawn criticism because it enables wireless carriers to obtain Universal Service Funds at the same rate as landline carriers even though the wireless carriers’ costs typically are lower and, unlike landline carriers, wireless carriers are not required to serve every customer within a service area.
The NBP proposes phasing out the CETC program, which is the only option available today for wireless carriers seeking USF support. Instead wireless carriers only funding options would be through the mobility fund or, if the carrier plans to deliver 4G service, it also could apply for funding under the proposed Connect America fund. That fund, which would replace today’s high-cost voice fund, would focus on broadband service supporting speeds of at least 4 Mb/s downstream—a goal that could be achieved with 4G, as well as landline technologies such as DSL.