FCC Chairman Ajit Pai has been asked by a bipartisan group of 56 senators in a letter (PDF) to continue working to advance broadband deployment in hard-to-serve rural areas.
Led by Senators Deb Fischer, R–Neb., and Amy Klobuchar, D–Minn., the letter asked the FCC to ensure the Universal Service Fund (USF) High-Cost program “can achieve the goal of making affordable broadband available to Americans in high-cost rural areas.”
Congress has been an ardent supporter of reforming the USF program, with an eye on enabling rural service providers to build out broadband infrastructure in areas that serve a smaller amount of consumers and businesses.
“We encourage you to consider any changes to the High-Cost mechanism that may be necessary to ensure it can achieve the goal of making affordable broadband available to Americans in high-cost rural areas,” the letter read.
For his part, Pai set closing the digital divide as one his goals as the new FCC chairman.
“One of the most significant things that I’ve seen during my time here is that there is a digital divide in this country—between those who can use from cutting-edge communications services and those who do not,” Pai said in his opening address (PDF). “I believe one of our core priorities going forward should be to close that divide—to do what’s necessary to help the private sector build networks, send signals, and distribute information to American consumers, regardless of race, gender, religion, sexual orientation, or anything else.”
Under his plan to close the digital divide, Pai proposed to direct billions of dollars over 10 years to expand 4G LTE wireless coverage and $2 billion to advance wireline broadband service across the country.
Decoupling POTS and broadband
In May 2014, 133 members of Congress—44 senators and 89 congressmen—signed a bipartisan letter asking the FCC to make modifications to USF support with an aim of helping smaller rural providers deliver standalone broadband in hard to reach areas.
Whether it is so-called "naked DSL" or an FTTH connection, standalone broadband has grown in popularity to support an array of online voice and video services inside the home.
“The shared concern expressed in those letters was that rural consumers who wished to 'cut the cord' on traditional voice 'plain old telephone service' (POTS) and opt instead to obtain only fixed broadband network could not do so,” the letter read. “As those letters noted, the FCC’s old rules unfortunately tied USF support to a consumer’s purchase of POTS, making it impossible for millions of rural consumers to obtain affordable “standalone broadband” without buying telephone service as well.”
Pricing, availability concerns remain
The FCC moved last year to modernize the USF program, with a particular focus on enabling rural rate-of-return carriers to provide standalone broadband service.
As part of that plan FCC will provide about $20 billion in support over the next 10 years to enable service providers in high cost areas to provide standalone broadband to users that use their connections to power VoIP and video streaming services.
Despite the FCC’s efforts, the lawmakers have been told by their constituents that standalone broadband pricing and availability remains two key hurdles in rural areas.
The lawmakers wrote that “we are still hearing frustration about the prices and availability of standalone broadband.”
“Many operators remain unable or unwilling to offer such broadband service because their prices would still be unreasonably high even after the reforms,” the lawmakers wrote. “Other operators may offer standalone broadband, but the costs they are forced to recover from rural consumers far exceed what urban consumers would pay for the same service.”
NTCA, an organization that provides advocacy for rural service providers, praised the lawmakers’ letter.
“We are deeply grateful to Senators Fischer and Klobuchar, and the many other members of the Senate representing more than half of the chamber, for their leadership in encouraging the FCC to ensure this program continues to be an effective linchpin of our country’s efforts to deploy and sustain advanced, affordable communications in rural communities,” said NTCA Chief Executive Officer Shirley Bloomfield. “This letter demonstrates a consistent and enduring commitment on the part of Congress to make sure that ongoing reforms to the USF are done right for the benefit of consumers who need better broadband at reasonably affordable rates both now and well into the future.”