At 3/10/2011 02:41 PM, MarlonS wrote:
>Hi All,
>
>I've been reading the USF proceeding that the FCC is working on.  It's LONG
>and boring.
>
>I've pretty much given up though.  I'm disheartened and disgusted.
>
>In the proceeding they give example after example of the abuse that's taking
>place within USF and it's cousin programs.  Yet the focus is in how to
>change the rules so that the abuse stops.

You give it too much credit.  I have also gone through the whole 
thing -- I'm in the middle of drafting my Section XV Comment -- and I 
see the focus on finding ways to dump even more money on the 
incumbents.  The most flagrant abuse might be slowed down but the 
gravy train keeps a-chuggin' along.

>How in the world are they going to get dishonest operators to stop being
>dishonest just by changing the rules?
>
>And all of the talk that I've read so far centers around how to revise the
>programs so that the same ol' people will somehow magically start behaving
>nicely and putting the funds into the customers instead of buying out their
>competition, bonus' or whatever.

And how to dump even more money onto the same ol' people so that they 
do what they're doing anyway, but spend more in the process.  The 
emphasis seems to be to subsidize information services so that 
subsidized incumbents can knock out unsubsidized competitors in areas 
where they only provide subsidized dial tone, because their existing 
broadband plant doesn't reach it yet.

>It sure looks like the fix is already in.  Lots of work, lots of talk, etc.
>But at the end of the day it'll be just like the stimulus programs, most of
>the money will go to the people that are largely responsible for the mess in
>the first place!
>
>Anyone else have a different take on this?

Your take on stimulus was too broad a brush.  Most of BIP went to the 
same old same old,  but much of the BTOP money went to newcomers who 
will offer middle mile competition.

But the USF reform is a farce.  There are some potentially good 
details, to be sure.  They have figured out that "local switching 
support" is no longer needed to buy 1980's vintage $1M switches to 
serve a tiny area; they realize that modern softswitches are a lot 
cheaper.  And the $300/month cap on presumed-okay is a start, though 
still ridiculously high.  It might make Sandwich Isles file a few 
more papers, unless they grant an exemption for native lands.

The good news is that they're not talking about adding a $1/month tax 
on phone numbers, as in the 2008 edition of the same NPRM.

>The NPRM is here:
>http://www.fcc.gov/Daily_Releases/Daily_Business/2011/db0209/FCC-11-13A1.pdf
>
>More info here (commissioner comments etc.):
>http://fjallfoss.fcc.gov/edocs_public/Query.do?numberFld=&numberFld2=&docket=10-90&dateFld=&docTitleDesc=
>
>If I'm reading this correctly, comments are due April 1st.

Comments on Section XV, which discusses three topics of intercarrier 
compensation (VoIP, access stimulation, and The Phantom Menace) are 
due on April 1.  Comments on other issues, including USF, are due 
April 18.  Hence I'm writing my rather brief (for me) Comment on Part 
XV now, though I've taken my notes on the whole thing to finish later.

>We still don't have a stance on much of what we think USF should be!
>
>My thought is that they should get rid of USF completely.  I don't care if
>you call it USF, CAF, e-rate or anything else, let the market handle this
>chore.
>
>But they won't do that.  So my next thought is that they should just expand
>the program, as is, to include the existing broadband players in the market
>and put a 10 year sunset on the program, after that, only the strong shall
>survive.
>
>But they won't do that either.  So how do we make it so that companies like
>Century Tel that have managed to leave wire laying across the ditch for
>YEARS out here because there is no budget to fix things, can't then turn
>around and buy out their larger competitors for billions of dollars?

What I'm planning to propose for USF is that they stop subsidizing 
only retail services, and apply the subsidies at the wholesale level 
instead.  So an ETC (recipient) will have to offer unbundled network 
elements and wholesale DSL access to third-party ISPs, with the same 
subsidy level as their own retail services.  Not that there's a 
snowballs' chance in Hell that Julius "I want a job at Verizon after 
my Federal dues are paid" G will go along with it, but I want it On Record.

Less far along the Overton Window, I am suggesting that they be 
stricter about the retail price that is subsidized.  The current rule 
*in theory* is that the "comparable" price be no more than two 
standard deviations above the urban rate.  In practice, subsidy 
whores set retail prices below the urban rate, and let USF make it 
up.  They *never* need rate increases.  So let their ratepayers have 
at least a little skin in the game.


  --
  Fred Goldstein    k1io   fgoldstein "at" ionary.com
  ionary Consulting              http://www.ionary.com/
  +1 617 795 2701 



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