December 2014

FCC Lifts E-rate Spending – Washington Reacts

When the Federal Communications Commission takes a major action -- like modernizing the E-rate program -- there’s gonna be reaction.

US Secretary of Education Arne Duncan said, “The Federal Communications Commission’s vote to further modernize the E-rate program ensures the program will continue to help our schools be part of the digital age. This is another huge step forward in our ConnectED Initiative’s work to provide high-speed internet access to schools and high-quality digital learning resources to teachers and students. We thank Chairman Wheeler, Commissioner Rosenworcel, and Commissioner Clyburn for their tireless efforts on this issue, their partnership and commitment to our nation's students.”

There are two lawmakers left in Congress who were key in the creation of the E-rate program in 1996. Today’s action by the FCC is a tremendous win for the future of our youngest generation and all future generations,” said Sen Jay Rockefeller (D-WV). “When I called upon the FCC to begin a process to strengthen E-Rate nearly two years ago, I knew that a cornerstone of that modernization effort would require additional funding for the program. That is why I have repeatedly called on the FCC to raise the permanent E-Rate cap. By increasing E-Rate’s cap by $1.5 billion, the FCC is making sure that schools and libraries will have access to broadband networks with next generation speeds and capacities.”

“Today’s historic vote at the FCC represents a win for our children, our economy, and our future,” said Sen Ed Markey (D-MA). “The E-Rate program is an essential part of our strategy to make our future workers best compete in the 21st century. By taking action today, the FCC officially commenced a bright new chapter for the already incredibly successful E-Rate program. The FCC’s vote will ensure that our schools and libraries achieve the connection speeds and Wi-Fi needed to connect fully with our interconnected world,” continued Senator Markey. “E-Rate will continue to ensure that students, whether from affluent communities or working-class neighborhoods, have the tools and skills necessary to succeed in our global economy.”

Rep Anna Eshoo (D-CA), Ranking Member of the House Communications and Technology Subcommittee, applauded the vote. "The FCC took a monumental step today to bring E-Rate into the 21st century. Funding for E-Rate was set during the days of dial-up Internet and in today’s digital world that level is simply inadequate. This boost will put into action a well-devised modernization plan to increase the presence of Wi-Fi in classrooms and bolster higher capacity Internet connections to our schools and libraries across the country. I applaud Chairman Wheeler for his leadership, and I salute Commissioner Rosenworcel, an early architect of E-Rate modernization who has visited schools nationwide to see firsthand how this program will benefit students. Her commitment to next-generation digital learning is unequaled at the Commission."

“The Federal Communications Commission’s historic approval to dramatically increase funding for the E-Rate program is a critical and much-needed win for America’s students and it makes for smart public policy,” said National Education Association President Lily Eskelsen García. “All of our students, regardless of their zip code, deserve access to the digital tools and the time to learn. Today’s action will go a long way to help level the digital playing field and ensuring equity. The first-ever significant increase in funding of the E-Rate Program will bring broadband to the communities that need it the most—students and educators in urban, rural, and low-density populated areas. More to the point, investing now in the E-Rate Program will pay off in the long run.”

American Library Association President Courtney Young said, “We are very pleased that the Commission, as ALA recommended, has removed restrictions that have prevented many libraries from getting the broadband they so desperately need. In addition, we applaud the Commission for recognizing our concerns regarding the funding shortage. Today, the FCC confirmed that it will add an additional $1.5 billion to the yearly program for libraries and schools. We congratulate the Commission for completing what amounts to re-engineering a 20th century telecommunications program and, after strategic review, reassembling it to make sure libraries can build and maintain the cutting edge networks that are the foundation for 21st century education, employment and entrepreneurship, community engagement, and individual empowerment.”

"The FCC's action today is a triumph for learning that reflects the world we live in and enables more personalized education. As we have seen year after year, America's classrooms do not have the needed technology infrastructure and related investments to cultivate learning environments that truly prepare students for college, career, and life. Today's vote paves that path for the current and next generation of America's youth,” said Consortium for School Networking CEO Keith Krueger.

“This is a landmark decision for our nation’s students and we commend Chairman Wheeler, Commissioner Clyburn, and Commissioner Rosenworcel for their steadfast commitment to connecting millions of America’s students to the promise of digital learning,” said Evan Marwell, CEO of EducationSuperHighway. “This bold plan of action will ensure the students of today are fully prepared to be the workforce and leaders of tomorrow.”

The National Hispanic Media Coalition (NHMC) commended the FCC for raising the cap of the E-Rate program to $3.9 billion. “We greatly appreciate and support the hard work of Chairman Wheeler and Commissioners Jessica Rosenworcel and Mignon Clyburn in fighting for the future of E-Rate. Ensuring that enough funding is available and that it is equitably distributed to both rural and urban school and libraries that need the support is an important and cost-effective investment in America’s future and is a step towards ensuring that none of our children are left behind,” said NHMC’s policy director, Michael Scurato.

John Windhausen, Executive Director of the SHLB Coalition: “We are thrilled with the FCC’s decisions today to increase E-rate funding by $1.5 billion per year, address the needs of rural America, and encourage the deployment of fiber optic connections to the schools and libraries without access to fiber. Since its founding in 2009, the SHLB Coalition has worked extremely hard to promote affordable, high-speed, future-proof Internet services to community anchor institutions. Along with several rounds of filings and meetings with FCC officials, the SHLB Coalition also submitted a detailed study estimating the costs of deploying fiber to the remaining schools and libraries. We are extremely pleased that the FCC acted on our recommendations to reform the E-rate program to promote greater fiber investment and to give schools and libraries the additional option of constructing and owning their own networks. This investment will be especially critical in rural areas where access to fiber is often limited. We are also very pleased that the Commission corrected the definition of “rural” to allow more E-rate funding to flow to communities below 25,000 people. Affordable, high-bandwidth connections to the Internet promote learning, community engagement, and economic growth. This decision is a monumental step forward for school children, teachers, library patrons and the communities they serve.”

Benton Foundation Applauds FCC's Big Broadband Boost for Education

[Commentary] Today, the Federal Communications Commission improved education for all our young people by providing the tools to connect every school and library to high-capacity broadband -- and Wi-Fi connectivity that delivers critical education tools right to students’ desks. This is a huge win for US education. By modernizing and funding the E-rate program for the 21st century, we will connect even the smallest, the poorest and the most rural classrooms and libraries to the world through the Internet. The actions the FCC takes today are exactly what’s needed to ensure our country’s competitiveness in the 21st century. Connecting all schools to high-speed broadband will help re-establish the US as a global leader in education -- setting an example for other countries that are struggling to improve their educational systems. Now all students will have the opportunity to develop the skills they need to succeed and prosper, and to realize the American Dream.

FCC Increases Rural Broadband Speeds Under Connect America Fund

Broadband for rural consumers that is supported by the Connect America Fund must deliver the same speeds that 99 percent of urban Americans enjoy, the Federal Communications Commission said in a recently adopted Order. The FCC will now require companies receiving Connect America funding for fixed broadband to serve consumers with speeds of at least 10 Mbps for downloads and 1 Mbps for uploads. The Order makes a number of adjustments to 2011 reforms to accommodate the higher speed requirement and better target Connect America funds to efficiently expand broadband into rural areas that would not otherwise be served.

These changes include:

Increasing the terms of support for price cap carriers from five years to six years, with an option for a seventh year in certain circumstances
Providing increased flexibility in the build-out requirement, while still ensuring that support recipients are reaching out to Americans that were previously unserved
Forbearing from certain universal service obligations in low-cost census blocks where price cap carriers are not eligible to receive Connect America support, as well as census blocks where the carriers face competition
Requiring recipients that decline Connect America support in a state to continue to deliver voice service to high-cost census blocks until replaced through a competitive bidding process by another subsidized carrier that is required to deliver voice and 10/1 broadband.

The Order also makes changes that will distribute traditional universal service support for small carriers more equitably and curb waste. Finally, the Order helps ensure that carriers adhere to voice and broadband service obligations by setting clear consequences for failing to meet these standards.

FCC Seeks Input on Incentive Auction Procedures

The Federal Communications Commission adopted a Public Notice seeking comment on detailed proposals for conducting the broadcast television spectrum incentive auction.

The Public Notice initiates the process by which the FCC will establish the final procedures for the incentive auction. It includes specific detailed proposals seeking input on crucial auction design issues, implementing decisions the Commission made in its May 2014 Incentive Auction Report and Order. Comments are due on or before January 30, 2015, and reply comments are due on or before February 27, 2015.

FCC Chairman Tom Wheeler Accommodates Title II Protestors

Federal Communications Commission Chairman Tom Wheeler accommodated protesters who initially interrupted the FCC's December public meeting to call for Title II reclassification of Internet access.

At the beginning of the meeting, the proceedings were briefly interrupted as protesters called for Title II to be on the agenda (it was not), talked about the plethora of comments in the docket, and even briefly unfurled a sign behind Chairman Wheeler. The chairman asked one speaker to hold off for a minute as a protester was shouting, but he did not upbraid the protesters. In fact, he pointed out that there were a lot of students in the audience and said they had just seen "the First Amendment at work," adding: "This is what the country is all about."

FCC Chief hopes to move 'quickly' on network neutrality

Federal Communications Commission Chairman Tom Wheeler said he hopes to move "quickly" on new network neutrality rules but declined to offer a specific timetable. "I think I said that I want to do it quickly, I want to do it right, and I want to do it sustainably," he told reporters after the commission’s open meeting. When asked again if it would come in February or March of 2015, he said only, "Quickly, right, sustainable."

FCC Chairman Tom Wheeler: Verizon Recognizes Title II No Big Bugaboo

Federal Communications Commission Chairman Tom Wheeler said he agrees with Verizon's CFO Fran Shammo that reclassification of Internet access under Title II would affect not the company's investment in its network. Chairman Wheeler seemed to suggest that Title II was a workable approach both from an industry and a Wall Street perspective.

He also said that the Communications Act "specifically says that wireless will be treated as a common carrier, but that the commission shall forbear from the vast majority of common carriage sections of Title II, except for 201, 202 and 208. So for 20 years all the wireless carriers have been living under Title II with appropriate forbearance, and have been able to raise and invest hundreds of billions of dollars and build a global network that is the envy of the world."

The Relationship Between Investment and Regulation

[Commentary] Recently, a few news sites ran stories about comments I made at an investor conference in response to a question about how the threat of Title II regulation might impact Verizon’s capital investment. As Verizon has indicated on several occasions over the past few weeks, discussions about potential regulatory changes related to network neutrality have been going on for a decade, and we don't change our short-term view on investment based on rumors of what might or might not happen. But as we and other observers of the net neutrality debate have made abundantly clear, experience in other countries shows that over-regulation decreases network investment. If the US ends up with permanent regulations inflicting Title II's 1930s-era rules on broadband Internet access, the same thing will happen in the US and investment in broadband networks will go down.

[Fran Shammo is the Executive Vice President and Chief Financial Officer at Verizon]

AWS-3 Rolls On; FCC Chairman Tom Wheeler Cites Success

The AWS spectrum auction got plenty of attention at the Federal Communications Commission's December meeting, where Chairman Tom Wheeler declared the auction a success -- others have already done so -- and handing out kudos to everybody from the government spectrum holders who agreed to move and share other spectrum to free up 65 MHz for the auction, to the White House, Congress, FCC staffers, and others who made it possible, including the National Telecommunications and Information Administration, which coordinated the federal spectrum part.

Chairman Wheeler said that while the bidding was not over. "When the House Commerce leadership is issuing statements on the auction using the headline 'BOOM!,' I think it is pretty safe to say that the auction is a success," he told reporters in a press conference following the FCC's monthly public meeting. "That headline was when it was only at $35 billion," he said, pointing out it was now over $43 billion.

Netflix denies accusation that it messed with Internet Service Provider's caching systems

Netflix denied accusations that its content delivery system is a "fast lane" that harms competitors and that it deliberately impeded caching systems used by Internet service providers. Netflix Global Public Policy Vice President Christopher Libertelli responded to Federal Communications Commission member Ajit Pai’s claims saying that Netflix's Open Connect program does not create an uneven playing field with Netflix getting priority over other content.

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