At a press conference Wednesday, FCC Chairman Kevin Martin confirmed he is circulating draft orders among the FCC’s commissioners that would authorize the operation of unlicensed devices in the digital TV “white spaces.” The orders would also reform the FCC’s intercarrier compensation and universal service rules to bring the agency’s policies in line with the market shift toward IP-based and broadband networks. The draft white space order is based upon findings published this week by the FCC’s Office of Engineering and Technology (OET), which concluded that unlicensed wireless broadband devices with sensing and geolocation capabilities could operate in the white space bands without causing harmful interference to adjacent TV broadcast and wireless microphone facilities. Wrapping up 18 months of testing, the OET further predicted that an order governing unlicensed use of white spaces would “open for use a significant amount of spectrum with very desirable propagation characteristics that has heretofore lain fallow” and would also “allow the development of new and innovative types of . . . devices that provide broadband data and other services for businesses and consumers.” Microsoft and Motorola (a developer of several white space prototype devices that were subject to OET testing) have lent their support to the proposed FCC order alongside online search giant Google, which believes that white space spectrum holds great potential for the extension of low-cost broadband services into rural and underserved areas and for the expansion of its web-based advertising platform to new broadband users. Microsoft urged the FCC “to come to a decision quickly and adopt rules that will allow all Americans to realize the full and enormous potential white spaces have to expand broadband access.”

Martin also highlighted FCC efforts to reform the agency’s intercarrier compensation and universal service fund regimes with the unveiling of draft decisions that would (1) allow the states to establish uniform reciprocal compensation rates for intra- and interstate voice traffic, (2) grant the FCC jurisdiction over IP-based phone traffic whose origin cannot be clearly defined, (3) raise existing caps on subscriber line charges, and (4) craft a universal service fund (USF) mechanism for broadband services. Acknowledging that both the reciprocal compensation and USF programs are “under stress and under duress” as the nation’s phone traffic shifts increasingly to IP-based networks, Martin proclaimed: “we need to move both of these programs into a broadband world where we recognize broadband capability is going to be the way people are exchanging traffic.” The draft order also responds to concerns raised by the DC Circuit Court of Appeals, which has given the FCC until November 5 to address intercarrier compensation issues as they pertain to ISP-bound traffic. As part of the draft USF order, rural carriers that receive USF funds for broadband deployment would be required to build out broadband infrastructure to all of their customers within five years. Wireless competitive eligible telecommunications carriers would also have to prove that their costs meet the same benchmark standards of wireline carriers before they receive high-cost USF funding. The FCC is expected to vote on the white space, intercarrier compensation and universal service orders on November 4.