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FCC Sets Comment Deadlines for Connect America Reforms

The FCC said Thursday that Jan. 28 and Feb. 11
will be the comment and reply comment deadlines for its proposal to modify
phase I of its Connect America Universal Service Fund reform.

the FCC had already set 30 and 45 days after publication of the proposal in the
Federal Register, so with that Dec. 28 publication, the dates have now been

November, the FCC proposed changing the rules on its first phase of the Connect
America Fund to make it more attractive to the price cap telcos it wants to
build out broadband to hard-to-serve, primarily rural, areas.

FCC, which is migrating phone subsidies in the Universal Service Fund from
telecom to broadband, announced in July that $115 million would be invested by
companies in 37 states. But that leaves most of the money -- $185 million -- in
the first round of funding unallocated.

first phase of the fund is transitional support as the FCC moves from the old
high-cost support mechanisms for price cap carriers to the Connect America
Phase II mechanism, in which the FCC will offer $1.8 billion annually to
subsidize broadband build-outs in price cap territories via a combination of
cost modeling and competitive bidding.

two largest potential recipients, AT&T and Verizon, declined to accept the
funding, deciding instead to build out on their own timetable and without the
restrictions the FCC put on the funding, which included a three-year build-out
deadline and a definition of unserved as lacking a minimum speed of 768 Kbps
downstream and 200 Kbps upstream. They also had to specify where they would
deploy and how much of their eligible funding they would use.

cap carriers that did accept included Frontier Communications, which took $71.9
million, and CenturyLink, which took $35 million from the fund to deploy
service to 45,000 homes. The company was actually eligible for $90 million, but
said restrictions on the funds made further deployment "uneconomical."

FCC, which still wants to get the targeted areas broadband as fast as possible,
is proposing modifying those requirements, including increasing the subsidized
area by expanding the definition of unserved to 4 Mbps downstream and 1 Mbps
upstream, in line with the FCC's new benchmark for high-speed broadband.