Satellite : ACA Rejects Telco's CAF Mods

Last week, the United States Telco Association (USTA) submitted a series of modifications to the FCC's Connect America Fund (CAF) that the ACA says would "maintain the old pro-incumbent system." In response, ACA President & CEO Matt Polka urged the agency to reject the group's proposal saying, if adopted, the USTA's plan would misallocate resources, distort competition, and delay broadband investment by the private sector.
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Among the ACA's concerns is the USTA's request to abandon the "flash cut withdrawal" of Phase I voice support when a reverse auction winner (other than the price cap carrier) begins to receive Phase II broadband support. The USTA wants the FCC to reduce that support over a 5-year period, but Polka said such a plan would hurt competition and break the FCC's budget. Instead, Polka said, carriers should continue receiving the funds in a "census block" until 1) it's proven that the block is served by unsupported competition, 2) an auction winner begins providing service within the block, or 3) a Remote Areas Fund recipient begins service in the high-cost area.
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A second problem the ACA has with the group's proposal stems from its plan for waivers on CAF broadband build-out deadlines. Various delays in the process can warrant waivers, both groups agree, however Polka said the USTA's plan needs to be curbed. "Limited waivers are not unreasonable (but they) should only apply to interim deployment coverage deadlines during the 5-year term of support," he said. After that, the FCC should determine whether providing broadband to areas not served by the support-recipient even requires further funding as an unsubsidized competitor could offer adequate service.
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Bottom line: The ACA holds that the FCC's USF reform order created necessary balance between competitive interests with regards rural broadband deployment. The USTA's proposal would force the agency to reconsider previous decisions that helped to strike such competitive balance. •