The FCC plans to adopt an order eliminating the controversial rural “rate floor” that restricts the amount of Universal Service Fund (“USF”) support received by some carriers to build and maintain networks in underserved areas at its next meeting scheduled for April 12, 2019. The rural rate floor, which requires carriers receiving Connect America Fund (“CAF”) support to charge a minimum monthly rate or risk losing subsidies, has been a longstanding target of criticism by Chairman Pai as well as consumer groups, Tribal authorities, and rural carriers. The proposed order follows a nearly two-year freeze in the rate floor implemented soon after Chairman Pai assumed leadership and would avoid an almost 50% increase in the rate floor scheduled to take effect in July 2019. Rate floor elimination would provide significant regulatory relief to rural carriers by increasing flexibility over service rates, while reducing associated reporting and customer notification requirements.

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It’s once again full speed ahead on spectrum and 5G deployment at the FCC, as the agency plans to take action at its next open meeting scheduled for April 12, 2019 on a slew of measures aimed at making additional millimeter wave (“mmW”) frequencies available to support 5G wireless technologies, the Internet of Things, and other advanced services. Topping the agenda, the agency expects to propose procedures for the simultaneous auction of spectrum for commercial wireless services in three mmW bands encompassing 3400 megahertz. As we previously reported, the proposal would clear the way for the FCC’s second-ever incentive auction (the first being the March 2017 broadcast spectrum incentive auction) designed to clear out incumbent licensees by offering payments in exchange for relinquishing current spectrum holdings. The agency also anticipates reforming access to mmW bands to facilitate the auction and extending long-standing protections for over-the-air reception devices (“OTARD”) to hub and relay antennas essential to 5G network deployment. Rounding out the major actions on the April agenda, the FCC plans to forbear from certain legacy long-distance regulations in the face of increased competition and eliminate the controversial rural “rate floor” for high cost universal service support.

You will find more details on the significant April meeting items after the break:


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iStock_000006131068MediumOn May 18, 2017, at its May Open Meeting, the Federal Communications Commission (“FCC”) adopted a Notice of Proposed Rulemaking and Order on a two-one vote, seeking comment on whether it should reform the so-called rural “rate floor” on basic voice service or eliminate it entirely.  The rural rate floor rule requires carriers receiving Connect America Fund support to charge rural customers a minimum monthly rate or risk losing subsidies.  The FCC imposed a two-year freeze on the rural rate floor to provide it with sufficient time to consider the proposed reforms.  The rulemaking is yet another reversal of a policy supported by former FCC Chairman Wheeler, which current Chairman Pai dissented from as a Commissioner, and represents another step by the Pai FCC to roll back its predecessor’s actions.

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