Reverse Auctions Order Won’t Be Ready until Mid-February, FCC Official Says
The FCC won’t have an order ready on reverse auctions for the proposed mobility fund until mid-February at the earliest, Chief Margaret Wiener of the Wireless Bureau’s Auctions & Spectrum Access Division said Monday at a Federal Communications Bar Association lunch. In October, the commission opened a rulemaking on whether it should use between $100 million and $300 million left over in the high-cost Universal Service Fund to create a reverse auction in which wireless companies in underserved areas have a chance to win subsidies to build out 3G networks. The comment period for the current rulemaking closes Dec. 16, and replies are due Jan. 17, Wiener said, making it unlikely that an order will be ready to go out before mid-February.
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The money was left behind when Verizon and Sprint gave up high-cost support, in separate merger conditions (CD Sept 7 p1). Though the proposed reverse auctions for the mobility fund are a one-off affair, Chairman Julius Genachowski and others at the commission see them as a kind of pilot program that could become the model for USF disbursements, senior commission officials have said.
The FCC is seeking broad comments on how to structure and run the auctions, from whether to use census tracts to methods of identifying eligible companies, Wiener said. She stressed that the proposed mobility fund is “not meant to be a replacement” of the other USF programs, but the “first step of reform.” The commission’s goal is to get the mobility fund up and running by the second half of 2011, she said.
Wiener’s comments didn’t sit well with Steve Berry, CEO of the Rural Cellular Association. The association has spoken out against reverse auctions, because they “won’t do anything meaningful for the consumer,” Berry said. “It’s a race to the bottom. And it’s a mechanism that allows the biggest companies … to decide which market they want to overtake at any time. They'll do it the old-fashioned way: Instead of working for it, they'll have the government do it for them."
The order on reverse auctions for the mobility fund were part of a package designed to overhaul USF that was supposed to have been on the December meeting. Those votes were put off to make room for Genachowski’s proposed net neutrality order on the agenda (CD Dec 2 p1). A USF overhaul can’t wait, the Independent Telephone & Telecommunications Alliance said Monday. With the fund’s contribution rate expected to take “an unprecedented leap” to 15.5 percent in the first quarter of 2011, “the FCC must no longer delay action on inter-carrier compensation and USF,” the alliance said.