WASHINGTON-Proposals and counter proposals for how best to ensure access to telecommunications services in rural America are under way as rural local exchange carriers and their champions in Congress argue for the status quo, while the wireless industry calls for wholesale reform of the system carriers use to compensate each other for carrying traffic on each other’s network.
The House Congressional Rural Caucus released its telecommunications priorities last week, and they mirror-almost word for word-the priorities of the Coalition to Keep America Connected, a group of rural wireline carriers that opposes wireless carriers receiving similar universal-service support.
Rural wireline carriers often complain that since their costs are higher than those incurred by wireless operators, those carriers should not receive the same amount of support.
“My experience has taught me that rural providers are the real pioneers in the field of telecommunications technology-a lesson reinforced this summer when I visited a local telephone company in my district and saw firsthand how technology is helping these firms do more with less,” said Rep. John Peterson (R-Pa.), CRC co-chairman. “Now, Congress must do its part to support, and not impede, the progress of these rural providers.”
The Federal Communications Commission expects to reform the universal-service system, set up in the 1930s to bring telecom services to high-cost areas using long-distance revenues.
The Coalition to Keep America Connected released a statement praising the CRC’s goals.
In addition to distributing support based on costs of the recipients, both CRC and the Coalition to Keep America Connected want the universal-service system to remain industry supported rather than paid for through general tax revenues.
RLECs generally have three revenue streams: universal-service support, intercarrier compensation and end-user fees.
Intercarrier compensation refers to the payments made between carriers for connecting calls on each other’s network.
The chief of the FCC’s Wireline Competition Bureau, Thomas Navin, told reporters earlier this year that intercarrier-compensation reform was a priority for 2006.
The wireless industry’s trade association, CTIA, told state regulators that they need to take into account the needs of wireless consumers and the benefits wireless can bring to rural America as they consider how the intercarrier-compensation regime should be changed.
“CTIA is concerned that the National Association of Regulatory Utility Commissioners Intercarrier Compensation Task Force is considering proposals that overlook what’s best for consumers and focus instead on maximizing revenue recovery for RLECs. A proposal that fails to unify and greatly reduce intercarrier charges or expands the unsustainable embedded cost-based universal-service regime will subject consumers in both rural and non-rural areas to higher costs and less competitive choice. Importantly, the absence of full unification will place the existing intercarrier-compensation system at greater risk as consumers migrate more and more traffic off the wireline circuit-switched network to alternatives such as Internet Protocol enabled services,” wrote CTIA President Steve Largent.
The wireless association again called for a bill-and-keep system. The “Mutually Efficient Traffic Exchange” proposal would require carriers to recover whatever costs they incur from delivering a call from an end user, not another carrier. RLECs contend that if bill-and-keep is adopted, they would lose a significant revenue source they say is necessary to keep their networks functioning.
