The Federal Communications Commission will provide additional funding for the Connect America Fund, the FCC’s program that helps expand broadband deployment and make broadband service more affordable in rural areas. In return for this increased funding, the FCC will require providers to expand the availability of faster service that will better meet the needs of consumers and businesses. The FCC updated the Connect America Fund programs providing support for small, rural providers, known as rate-of-return carriers, to deliver faster broadband speeds and expanded coverage in rural areas. In return for additional funding, the FCC will require providers to expand availability of service offering downloads of at least 25/3 Mbps service, compared to the current 10/1 Mbps standard. Updates include:

Offering up to $67 million a year in additional support for carriers receiving funding through the Connect America Fund’s Alternative Connect America Cost Model, or ACAM. This revised offer alone has the potential to increase by 100,000 the number of rural homes and businesses with access to 25/3 Mbps service.

Opening a new window for carriers receiving support through legacy mechanisms to voluntarily move to model-based support through the A-CAM II offer, which incentivizes deployment while reducing regulatory burdens. In return, these carriers would be required to provide 25/3 Mbps service to all homes and businesses whose costs are fully funded through the A-CAM cost model.

Increasing the $1.4 billion annual budget for carriers that continue to get support from legacy mechanisms by initiating an annual inflation adjustment, eliminating 2018 cuts mandated by budgetary rules established under the prior Administration, and setting a guaranteed floor of minimum support for each carrier. In return, legacy providers would be required to expand deployment of 25/3 Mbps service.

The FCC combats waste by reducing the maximum per-line subsidy in the legacy program from the current $250 to $200 by July of 2021. It also eliminates a burdensome capital expenditures allowance rule, which failed to incentivize investment by companies where it had been lacking or to rein in significant waste. The FCC also determines that a market-based auction can best eliminate wasteful subsidies to legacy providers serving areas that are entirely or almost entirely overlapped by unsubsidized providers. Eliminating unnecessary support in such areas could save the Fund up to $12 million annually. The item includes a Further Notice of Proposed Rulemaking seeking comment on how to structure such an auction, as well as how to address conversions to broadband-only lines and whether to include a Tribal Broadband Factor for legacy carriers

The Federal Communications Commission issued a ruling rejecting requests to make it harder for text messaging providers to protect consumers from spam and scam robotexts. The FCC’s decision makes clear that wireless providers are authorized to continue their efforts to stop unwanted text messaging through robotext-blocking, anti-spoofing measures, and other anti-spam features. In this ruling, the FCC denies requests from mass-texting companies and other parties to classify text messaging services as “telecommunications services” subject to common carrier regulation under the Communications Act—a classification that would limit wireless providers’ efforts to combat spam and scam robotexts effectively. Instead, the FCC finds that two forms of wireless messaging services, Short Message Service (SMS) and Multimedia Messaging Service (MMS), are “information services” under the Communications Act. With this decision, the FCC empowers wireless providers to continue taking action to protect American consumers from unwanted text messages.

The Federal Communications Commission's Broadband Deployment Advisory Committee (BDAC) has proposed a new tax on Netflix, Google, Facebook, and many other businesses that require Internet access to operate. If adopted by states, the recommended tax would apply to subscription-based retail services that require Internet access, such as Netflix, and to advertising-supported services that use the Internet, such as Google and Facebook. The tax would also apply to any small- or medium-sized business that charges subscription fees for online services or uses online advertising. The tax would also apply to any provider of broadband access, such as cable or wireless operators. The collected money would go into state rural broadband deployment funds that would help bring faster Internet access to sparsely populated areas. 

BDAC has been criticized by San Jose Mayor Sam Liccardo—who quit the committee—"for advancing the interests of the telecommunications industry over those of the public." An AT&T executive who is on BDAC argued that the recommended tax should apply even more broadly, to any business that benefits financially from broadband access in any way. AT&T stands to be one of the biggest beneficiaries if states assess the new taxes. The proposed tax doesn't seem likely to get support from FCC Chairman Ajit Pai. "Chairman Pai has been clear that he opposes taxes on the Internet," a spokesperson for Chariman Pai said. 

The Fiber Broadband Association and RVA, LLC released a new report on the rapid growth of the North American fiber broadband industry. Key findings include:

• In 2018, fiber surpassed DSL to become the second most common connection for home internet in North America after cable. In North America, fiber now passes nearly 60 million homes and connects 23.8 million.
• In the US, fiber now passes 41 million unique homes and connects 18.6 million homes. This is a 17% increase in homes passed by fiber since 2017. 1.6 million homes can get fiber broadband from two or more providers.
• In the US in 2018, more than 1,000 smaller providers were responsible for 29% of the fiber build, with four major Tier 1 providers responsible for the other 71%.
• Canada leads North American fiber deployment, with 19% growth in homes marketed in 2018 alone.

California state regulators have been ginning up a scheme to charge a fee for text messaging on mobile phones to help support programs that make phone service accessible to the poor. The wireless industry and business groups have been working to defeat the proposal, now scheduled for a vote in January by the California Public Utilities Commission. It’s unclear how much individual consumers would be asked to pay their wireless carrier for texting services under the proposal. But it likely would be billed as a flat surcharge per customer — one of those irksome fees at the bottom of your wireless bill — not a fee per text. The CTIA, which represents the US wireless communications industry, said in legal filings to the commission that texting is an information service like email, not a telecommunications service subject to the commission’s authority.

A dense California Public Utilities Commission report laying out the case for the texting surcharge says the Public Purpose Program budget has climbed from $670 million in 2011 to $998 million in 2017. But the telecommunications industry revenues that fund the program have fallen from $16.5 billion in 2011 to $11.3 billion in 2017. “This is unsustainable over time,” the report says, arguing that adding surcharges on text messaging will increase the revenue base that funds programs that help low-income Californians afford phone service.