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Cable Ops Agree It's Time to Reform USF

The National Cable & Telecommunications Association supports reforming the Universal Service Fund to target broadband, but also wants it to better target areas with unsubsidized competition while controlling the size of the fund.

 The American Cable Association (ACA) also gave a shout-out for reform and controlling the size, but asked that the high-cost fund not be entirely eliminated where smaller operators are concerned.

 That came in comments Monday responding to the FCC's national broadband plan proposal to migrate the fund from phone service to broadband, eventually phasing out subsidies for traditional phone service altogether. That fund is paid into by industry to subsidize service to areas that are too costly to be economically feasible to reach.

 In its comments, NCTA supports the FCC's goal of universal broadband service at 4 mbps downstream, 1 mbps upstream as onethat "appropriately balances the goal of achieving universal access with the political and financial reality that continued growth in the burden the fund places on consumers will jeopardize public support for their entire program."

 And taking a page from FCC Chairman Julius Genachowski's mantra on data-driven decisionmaking, NCTA advises it to take into account data showing where cable operators are already providing "competitive, unsubsidized" service, areas currently receiving high-cost support where it should not be, NCTA suggests. "Shifting support away from these competitive areas, as proposed in NCTA's petition, would not pose any risk that reductions in support might inadvertently jeopardize the continued ability of consumers to receive service."

 In a separate filing, Comcast, NCTA's largest member, said that the FCC should not just reallocate revenues from the high-cost fund to its new Connect America broadband subsidy fund, but should instead try to reduce the size of the high-cost fund.

 ACA said it supported creating the Connect America broadband subsidy fund, but said that there was value in continuing the high-cost fund "in a limited fashion" for carriers with 100,000 access lines of fewer, to support "voice and evolving telecommunications services for smaller telephone companies who require the support to ensure that they can provide quality services at rates reasonably comparable to that provided in urban areas."

 ACA concedes that a possible trade-off for continuing to support some smaller telephone companies via the high-cost fund "may delay the bringing of broadband to all unserved areas," but says it is worth it to insure the continued availability of wireline voice service in those areas at reasonable prices.