The FCC has a lot on its agenda for its next monthly meeting – including three items involving rural telecom issues. The FCC rural telecom issues pertain to rural carrier contributions to the Universal Service Fund (USF), potential access charge rule changes and a possible reversal of certain requirements for carriers transitioning from TDM-based offerings to IP-based alternatives.
FCC Rural Telecom Issues- USF Contributions
One of the orders the FCC will address at the next meeting aims to correct an inconsistency in how carrier contributions to the Universal Service Fund are calculated.
All carriers pay a certain portion of their revenues into the USF and in general, internet revenues are not included in the contribution base. According to a draft order, however, some rural carriers are required to include certain broadband internet service revenues in their contribution base.
This occurs for rural carriers that offer broadband internet as a common carriage service in order to participate in the National Exchange Carrier Association pooling system or certain other tariffed rate structures, the FCC explains in the draft order, which proposes eliminating those internet revenues from the contribution base for those carriers.
Access Charge Stimulation
Another item on the agenda pertains to the access charges that one carrier pays another for terminating traffic to one another’s customers. Those charges tend to be higher in rural areas, which has led to a practice known as access charge stimulation in which some carriers have been accused of reaching deals with entities that receive a lot of inbound calls, thereby boosting access charge revenues.
The FCC will vote on a public notice that would give access-stimulating carriers the option of bearing financial responsibility for the delivery of terminating traffic to their end offices, including applicable intermediate access provider terminating charges, or accepting direct connections from either a long-distance carrier or intermediate access provider chosen by the long-distance carrier, thereby allowing the long-distance carrier to bypass intermediate access providers imposed by the local carrier.
The public notice also seeks comment on a variety of issues related to access charge stimulation, including a proposal to move all terminating tandem switching, common transport and tandem-switched transport rate elements for access-stimulating carriers to bill-and-keep.
As carriers transition from traditional TDM-based communications to more modern communications based on IP, they are currently required to provide advance notice of any services they plan to discontinue. A draft report and order that the FCC will vote on at the next meeting proposes to relax some of these requirements, arguing that they are unnecessary.
At least one element of the order is likely to be controversial, however. The order also proposes to facilitate “rapid restoration of communication networks in the face of natural disasters and other unforeseen events” by reducing or eliminating FCC oversight of network changes during recovery efforts.
Consumer group Public Knowledge immediately voiced opposition to the order, arguing that it could lead to a repeat of the “Fire Island debacle” – a reference to what occurred when Verizon attempted to replace traditional TDM- and copper-based services with wireless offerings in an area where a hurricane destroyed existing local service infrastructure.
In a press release, Public Knowledge argued that the order “puts rural communities, small businesses, the elderly and people with disabilities at risk of suddenly losing access to vital services or, worse, experiencing a downgrade in service.” Apparently Public Knowledge singles out rural communities because those communities are least likely to be served by multiple telecom providers.