Payphones Shouldn’t Get Lifeline Funding, Industry Tells FCC

Verizon opposed the request by the American Public Communications Council to provide Lifeline support for public payphones (http://xrl.us/bm688s). “It makes no sense to divert scarce universal service resources away from national broadband priorities in order to support a legacy voice service that the market and technology is passing by,” the telco said. Verizon also opposed a “misplaced suggestion” by the D.C. Public Service Commission to classify interconnected VoIP as a telecom service, arguing the classification of VoIP has been “pending and vetted for years in other Commission dockets,” and is “far outside the scope of this Lifeline program proceeding."

USTelecom also opposed the payphone request, claiming the APCC “merely repeats the same weak arguments it made in December of 2010 when it filed two petitions on the same issue” (http://xrl.us/bm68z5). Its request for Lifeline funding for payphones seems to “confuse the concepts of high-cost and low-income universal service funding,” USTelecom said. “Given the finite resources of the Universal Service Fund, supporting all payphone lines in order to reach some low-income consumers is contrary to good public policy that would militate in favor of better, more precise, targeting of universal service support."

The National Telecommunications Cooperative Association opposed a T-Mobile petition to reconsider limiting Lifeline support to one-per-household, and a petition to reconsider the rule that receipt of support for wireless service be conditioned on customer activation of a handset (http://xrl.us/bm682f). NTCA further reiterated its belief that some of the new Lifeline rules, like the temporary address re-verification requirement, are “unnecessary or overly burdensome."

CTIA opposed USTelecom’s request that the commission adopt a single-speed benchmark for the Low-Income Broadband Pilot Program, arguing it “would ignore both the operating constraints of wireless broadband networks and the benefits of mobility for low-income consumers” (http://xrl.us/bm6842). CTIA supported petitions by GCI, Sprint, TracFone and USTelecom to reconsider the temporary address re-verification rule; modify “impractical, overly burdensome, and unnecessary” advertising disclosure requirements; rethink the “enormously difficult” biennial audit requirement for entities getting at least $5 million in annual Lifeline support; and postpone mandatory documentation of program-based eligibility until carriers get access to an eligibility database.

General Communication agreed with most of USTelecom’s petition, but opposed its suggestion that Commission “adopt a one-size-fits-all speed benchmark for all technologies and all geographic areas,” it said (http://xrl.us/bm6884). “Instead, the Commission should set lower speed benchmarks for rural areas, such as Alaska, and the technologies actually available to specific areas."

U.S. Cellular, C Spire Wireless, Smith Bagley, Budget PrePay, PR Wireless, Viaero Wireless and Carolina West Wireless said in joint comments they agreed with several filers about the burdensome and unnecessary nature of several new requirements (http://xrl.us/bm688h). “For example, the Commission should clarify that states cannot add certification requirements that are more burdensome than the certification requirements set forth in the Commission’s rules,” the groups said. “The Commission should also clarify the appropriate documentation required to demonstrate program eligibility."

Sprint Nextel supported the requests for reconsideration of the “unnecessary” temporary address rules, the “costly” biennial audit rules, and the “arbitrary” and “unexplained” $9.25 flat-rate Lifeline benefit (http://xrl.us/bm68y8). The carrier also opposed APCC’s request to provide payphone support. Payphones are “not used by a majority of residential customers,” and payphone providers are not qualifying low-income consumers eligible to receive Lifeline support, Sprint said.

Cricket opposed a TracFone petition to undo a requirement to review documentation of program-based eligibility (http://xrl.us/bm6855). “The rules about which TracFone complains are important and provide a practical means of improving the integrity and effectiveness of the Lifeline program,” Cricket said.

The D.C. Public Service Commission supported USTelecom’s request for reconsideration of two sections of the Lifeline Order regarding verification of customer eligibility, which it said duplicated rules already on the books and would impose heavy administrative burdens not just on eligible telecom carriers, but also state agencies that must verify eligibility as well (http://xrl.us/bm68yo).

The California PUC opposed USTelecom’s request to limit states’ authority to adopt additional Lifeline regulations; Nexus’ request to “encourage” states to process a carrier’s application for eligible telecommunications carrier status even if the carrier had not gotten FCC approval of its compliance plan; TracFone’s request to eliminate the documentation requirement for program-based eligibility applicants; and GCI’s request to eliminate the biennial audit requirement (http://xrl.us/bm6833). “California -- and likely many other states -- does not have the resources to conduct audits of these large multi-state carriers on a regular basis,” it said.

NASUCA said it “sympathizes with the plight of payphone providers as their market withers away,” but “providing Lifeline support is not the answer” (http://xrl.us/bm687n). A reexamination of “public interest telephones” under section 276 of the Communications Act is the better approach, NASUCA said, suggesting the FCC adopt a new program that includes criteria for payphone support. NASUCA supported the D.C. PSC’s request to classify VoIP as telecom services; opposed T-Mobile’s proposal to grant Lifeline support to additional lines on family plans; opposed TracFone’s petition for reconsideration of the $9.25 level of support; and opposed USTelecom’s request that certain notifications to Lifeline subscribers be “flexibly applied by carriers as they deem appropriate."

The National Congress of American Indians opposed USTelecom’s request to reconsider rules requiring carriers to “provide tribe-specific information to tribal governments upon reasonable request” (http://xrl.us/bm686h). USTelecom had argued it lacked contact information for the various tribes and tribal representatives. “This position is not supported by any evidence,” NCAI said, arguing that even if a carrier claimed it didn’t have proper contact info, “that should not preclude the ETC from actively attempting to reach out to tribal governments, especially where the ETC is serving a tribe or its citizen.” The Gila River Indiana Community and Gila River Telecommunications also took issue with this aspect of USTelecom’s petition (http://xrl.us/bm685p). Contacting tribes is “very easy” -- the overwhelming majority of tribes have their own website -- and engaging tribal governments will ensure that the Lifeline program better meets their needs, the groups said. - Matthew Schwartz