Thursday, June 7, 2018

FWD: FCC Chairman Ajit Pai advances his reform agenda

Building on a series of regulatory reforms adopted last November, the FCC under Chairman Ajit Pai has just adopted a new set of orders aimed at eliminating "unnecessary regulatory hurdles for carriers seeking to move from the networks of yesterday to the networks of tomorrow."

This set of reforms intends to:

  • Streamline the grandfathering of lower-speed data services where the carrier already provides fixed replacement data services at download speeds of 25 Megabits per second and 3 Mbps for uploads.  The streamlined process provides 10 days for public comment, and grandfathering is allowed automatically in 25 days, barring substantive objections.
  • Streamline the permanent discontinuance of services already grandfathered by the Commission for 180 days.  The process will now provide 10 days for comment and 31 days for an automatic grant.
  • Relieve carriers of discontinuance approval obligations for services with no customers and no reasonable requests for service for at least the preceding 30 days.
  • Eliminate burdensome, inflexible, and unnecessary education and outreach requirements for carriers discontinuing legacy voice services in the transition to next-generation IP services.
  • Allow carriers to seek streamlined discontinuance of legacy voice services when a carrier provides stand-alone interconnected VoIP throughout its affected service area, and at least one other stand-alone, facilities-based voice service is available from another provider.
  • Eliminate unnecessary and burdensome or redundant notifications for changes that may impact compatibility of customer premises equipment.
  • Facilitate rapid restoration of communications networks in the face of natural disasters and other unforeseen events by eliminating advance notice and waiting period requirements for network changes in exigent circumstances.

Currently, the five-person commission is missing one member, as the term of Mignon L. Clyburn, a Democrat, has expired. This means the FCC is currently served by 3 Republicans (Chairman Ajit Pai, Commissioner Michael O’Rielly, and Commissioner Brendan Carr) and only one Democrat (Commissioner Jessica Rosenworcel). Not surprisingly, on issues of regulatory reform and "elimination of burdensome rules" the Republicans voted in favor of the measuring, believing it to be business-friendly, while the lone Democrat voted against it, arguing that rules are needed as safeguards for the public.

Ajit Pai put it this way: "Last November, we took steps to accelerate the transition to next-generation networks.  Today, we do even more to modernize our rules.  These reforms can free up billions of dollars which carriers can devote to building new networks instead of propping up old ones.  This is especially important in rural America, where the business case for building broadband is often hard.
The end result of all these efforts will be more rapid deployment, which means better, faster broadband and more competition for American consumers. One example of a reform we adopt today is our decision to streamline the discontinuance process for low-speed data services if a carrier is already providing high-speed broadband—i.e., at least 25/3 Mbps.  This links regulatory relief to the provision of high-quality replacement services, which will both encourage the building of modern networks and ensure that consumers are protected." 

In dissent, Jessica Rosenworcel writes: "When a carrier wants to make big changes to its network, this agency had policies in place to ensure no consumers were cut off from communications.  In other words, leave no consumer behind.  We had rules that required carriers to educate their customers about network alterations and simply answer calls about how their service might be changed when old facilities were swapped out for new.  Today the FCC guts these basic consumer protection policies.  It tosses them out.  It says we don’t need them.  So what does that mean?  Imagine a grandmother living in a rural community.  Her service provider wants to make big network changes because the cost of serving that remote area with traditional network technology now exceeds the revenue.  That makes sense for the carrier.  But for our grandmother, she just wants to know that her phone, her health monitor, and her alarm system—all of which rely on her current network—continue to work.  She wants a heads up.  She wants to be able to navigate change and understand what will require a new contract.  She wants information about what will involve a new service and at what cost... This is mean.  It’s not just mean to my fictional grandmother, it’s mean to millions of Americans who will find that their carriers can switch out services without advance notice or consumer education, leaving them scrambling to find alternatives, reconfigure their homes and businesses in order to keep connected."

President Trump recently nominated Geoffrey Adam Starks, of Kansas, to be the replacement commission for Mignon Clyburn, for a term of five years from July 1, 2017. If approved by the Senate, his nomination is expected to restore a 3-2 balance inside the FCC. Sufficient for Ajit Pai to continue his reform program.

In the meantime, the 3-1 voting balance means that Pai has more leeway. Another order adopted this week with all 3 Republicans voting in favor waives the requirement for small, rural carriers to contribute to the Universal Service Fund (USF) on their broadband Internet access transmission service revenues. Hopefully, these small, rural carriers will pass the savings on to their end customers, thus lowering the cost of rural broadband. On the other hand, it may weaken the Universal Service Fund.