Policy Panel Tackles USF, Net Neutrality

Wiley Rein’s annual telecom policy and law panel at NXTcomm, the industry trade show going on this week in Chicago, once again proved a high point of the confab. Panelists from manufacturers, carriers, the FCC and policy think tanks commented on a number of hot button issues, with universal service taking the forefront. ConnectKentucky continues to get more praise. The program was the first state effort to truly attempt to identify broadband haves and have-nots. Rather than rely on statistics, state officials sought to answer the most practical questions by thoroughly mapping the state to determine what areas had no broadband infrastructure, what areas had broadband service available, but low household penetration, and, finally, what solutions could be applied in both cases. The FCC has floated the idea of creating similarly detailed broadband “map” for the entire country, as part of an effort to reform universal service rules for the broadband era. The chief concern comes down to directing universal service funds where they are most needed. Here’s an excerpt from Telephony’s daily online coverage of the convention,

The FCC is looking to measure, among other things, speed and penetration to identify market failures and areas that may require special attention and funding. Carriers currently are required to file reports on broadband subscription numbers, but the picture these paint is unclear. “With the absence of information it is hard to deal with this problem,” [Jeff] Campbell [director of technology and communications policy at Cisco Systems] said. “Mapping in Kentucky identified a lot of low hanging fruit next to other areas that were reachable. So people put money up because they could see where the gaps were and knew what it would take to get the job done.” George Ford, chief economist and editorial advisory board member of the Phoenix Center, said part of the success in Kentucky was that is was a grass roots movement where people volunteered to drive around the state to create the maps. It might be difficult to duplicate that effort in a state like California. [Robert] Quinn [senior vice president of federal regulatory at AT&T] added that Kentucky had another advantage. Because the effort was conducted as a public/private partnership, Kentuckians had confidence that the information in the database would be kept confidential. Other, stickier, issues still inhibit broadband penetrationââ?¬â??the stickiest being the reform of Universal Service Funding. Quinn said the industry has to fix the [USF] distribution mechanism to ensure that “somehow, someway we will be able to get broadband on an economical basis to all consumers.” Campbell said current USF is subsidizing old technology and that the industry should find ways to fund the building of new infrastructure. “Replicating the current system for broadband would be a huge disaster,” he said.

No policy panel would be complete without a discussion of network neutrality, and most of the panelists found the entire issue to be a ruse, Telephony reported.

However, its ability to take the incentive out of network investment remains. “You can’t apply Net neutrality to IPTV [for instance]. We are investing to bring a competitive service to market and if you tell me that neutrality will creep into video, there would be no business model for 25 Mb/s access,” Quinn said . Campbell said Net neutrality would hurt the quality of experience for new services. It would result in managing network traffic as if it were street traffic with no traffic lights. “Onerous legislation here would inhibit quality. They underestimate how much individual experience on the network today is improved by traffic management,” he said. Ford said even the champions of dumb networks admit that nobody would even build such networks. “So it is not even a question of whether or not it would effect investment,” he said.