FCC Chairman Outlines USF And Intercarrier Comp Reform Proposal

By Tom Smith, Editor, The Independent Telecom Report

FCC Chairman Julius Genachowski outlined a framework for USF reform in a hastily-scheduled speech last week at the FCC. The speech came amid growing opposition to a USF reform plan pushed by the industry’s price-cap carriers, the ABC Plan. Much of that opposition came from consumer and public interest groups and state commissioners, but also included extensive opposition from the wireless and cable industries, some mid-sized carriers, and many small rural carriers.

The speech by the FCC Chairman was long on rhetoric, but short on details. Yet, it capped an often-wild and furious lobbying effort at the FCC over the ABC Plan in recent weeks. The speech seemed to suggest that the plan put forward by the FCC Chairman will not be as comprehensive as first thought and will focus primarily on cost controls by capping USF and establishing a broadband speed threshold that, in effect, will limit the amount of funds spent to provide and maintain high-speed broadband services in rural areas. The proposal, if approved, could lead to two different broadband standards: one for urban communities and a slower speed standard for rural communities. Genachowski is now circulating his proposal for USF reform among his colleagues on the Commission. The FCC is tentatively set to take up the Chairman’s plan at its October 27 public meeting. (Click here to see this week's Report.)