Pointing to pledges that all five FCC commissioners made to members of the Senate Commerce Committee in March, FCC Commissioner Ajit Pai urged his FCC colleagues this week to make good on their promises by adopting rules by the end of this year that would provide rural carriers with Universal Service Fund (USF) support for stand-alone broadband services. 

In a speech Monday before the National Telephone Cooperative Association’s Telecom Executive Policy Summit, Pai lamented current USF rules that require rural carriers to offer broadband alongside voice services as a condition for receiving USF support.  Pai charged that the current regime thus leaves some rural carriers with “a Hobson’s choice” in which carriers “can offer stand-alone broadband—which urban consumers have and rural customers want—and lose [USF] support,” or “deny customers the option of an Internet-only service and risk them dropping service altogether.”  The result, said Pai, is that rural carriers “hold back investment because they are unsure if they can deploy the next-generation services that consumers are demanding,” which, in turn, frustrates the FCC’s goal of expanding broadband deployment in rural areas. 

Addressing “speculation” that it is not possible for the FCC to act on amendments to the USF rules by the end of this year, Pai told his audience, “there is no reason whatsoever why we can’t act by December 31 if our focus is on solving the stand-alone broadband problem.”  (Meanwhile, in remarks regarding this issue before the House Communications & Technology Subcommittee on Tuesday, FCC Chairman Tom Wheeler advised lawmakers that “we’re not going to be controlled by the calendar, but we want to get this done quickly.”)  As part of any USF rule fix, Pai recommended adoption of a plan he announced last spring that would (1) include stand-alone broadband costs when calculating high-cost loop and interstate common line support, (2) calculate how much of that support should be attributed to stand-alone broadband, and (3) direct that support to be used to offset the cost of broadband service.  In addition to giving rural consumers the option of choosing broadband as a stand-alone service, Pai explained that these proposed rule changes would “give carriers more assurance that arbitrary loopholes won’t prevent them from meeting consumer demand” while also meeting “the FCC’s own goals of distributing support equitably and efficiently.”