Commissioners approved 5-0 a Connect America Fund order to transition from legacy, Phase I price-cap incumbent telco support to CAF II support won at auction last year. As some expected (see 1902130054), the FCC stuck to a draft decision to decline a USTelecom proposal for interim voice support in certain areas, though it did make tweaks in response to ILEC requests. At Thursday's meeting, members also unanimously approved an IP captioned telephone service order, Further NPRM and order aimed at enhancing program management, combating abuse and improving emergency call management.

The House Consumer Protection Subcommittee’s Feb. 26 hearing is a starting point for developing “comprehensive privacy legislation,” House Commerce Committee Chairman Frank Pallone, D-N.J., told reporters Wednesday, the day the hearing was announced. Asked if he has his own privacy bill in the works, Pallone said, “We’re working on it, but we want to have the hearings, and we’re gradually putting something together.”

Donald Trump's administration released its American Broadband Initiative milestones report Wednesday, outlining a strategy for spurring wireless and wireline broadband using federal lands. It includes opening Department of Interior (DOI) towers for communications use and streamlining other buildout. The Senate Commerce Committee held a hearing on ways to ensure U.S. infrastructure keeps up with economic growth.

FCC officials are discussing tweaking a Connect America Fund Phase I draft order on commissioners' meeting agenda Thursday, we're told. But the agency may not back off very much planned dismissal of a USTelecom proposal for interim ILEC voice service support in currently unsubsidized areas.

Telco incumbents and rivals disagreed on an FCC proposal to scrap ex-ante regulation of price-cap carrier business data service TDM transport rates. Comments were posted through Monday in docket 16-143 on a Further NPRM (see 1810230032) on court remand of 2017 deregulation for lack of notice that some called an easy fix (see 1808280050). The commission should follow through on freeing price-cap telcos from TDM transport ex-ante rate regulation, commented USTelecom and ITTA: denial "would discourage competitive transport entry." AT&T said facilities-based transport competition is already "effectively ubiquitous." CenturyLink said transport services face "intense competition." The FCC can reach "the same conclusions regarding transport on the existing record, so long as it adequately considers" comments, said Verizon. "It would require an extraordinary change in factual circumstances to justify a departure or reversal." Deregulation critics' fears "have become reality" as "competition has been unable to keep ILEC TDM rates in check," commented Sprint, saying it's "experiencing significant price increases for newly deregulated" DS1 and DS3 transport and last-mile links. Incompas said the proposal "would lead to price increases for businesses and consumers." Instead, the commission should propose a market test to deregulate areas only where competition ensures just and reasonable rates, the group said. The American Petroleum Institute objected to deregulation in areas of concern to its member companies "in the absence of ILEC commitments to maintain reasonable levels of service." Alaska Communications (here) and other incumbents opposed a competitive market test. Addressing other FNPRM queries, USTelecom and ITTA said the FCC should grant rate-of-return carriers choosing price-cap treatment "further pricing regulation relief with respect to their TDM transport services," without a large data collection.

Telecom interests advised the FCC to encourage wireless network resiliency improvements through coordination with electric utilities, going easy on mandates. Utilities urged more telecom sector engagement with state and local authorities, and greater network protections, including through backup power. Comments were posted in docket 11-60 through Monday on a Jan. 3 Public Safety Bureau public notice seeking ways to increase such coordination amid emergencies (see 1901030037). Some telco and cable parties cited their backhaul efforts, responding to a Dec. 10 PN (see 1812100027).

USTelecom and members urged the FCC to fund telco voice services mandated in extremely high-cost areas not receiving Connect America Fund Phase II support. They said parts of a CAF I draft order on commissioners' meeting agenda Thursday reasonably address "the immediate task of disaggregating frozen support." But the agency "must either provide funding commensurate with the [voice] obligations" or "guidance on a path forward to relieve price cap carriers of their unfunded mandate," said a filing on USTelecom, AT&T, CenturyLink, Consolidated Communications, Frontier and Verizon meeting aides to Commissioner Geoffrey Starks, posted Friday in docket 10-90. They said the draft "prematurely dismisses" a USTelecom funding proposal as too costly and "impermissibly extends" indefinitely a 4-year-old "interim" period supposed to end with a recent CAF II auction. They asked to scrap that dismissal and postpone consideration, noting USTelecom hasn't been able to revise the proposal because CAF II auction results aren't finalized. Alternatively, they sought other draft tweaks. USTelecom and Frontier signaled concerns recently (see 1901160051).

USTelecom said early data show broadband investment continued to grow in 2018, bolstering a 2017 turnaround when the FCC signaled its plan for Title I Communications Act net neutrality deregulation. Based on initial review of financial releases, the six largest broadband providers increased capital expenditures 3.6 percent to $66.3 billion, blogged Patrick Brogan, vice president-industry analysis, Thursday. He said Sprint's capex jumped 50 percent, T-Mobile's 5.8 percent, Charter Communications' 5.1 percent and AT&T's 3.9 percent, while Verizon's dropped 3.4 percent and Comcast's 3 percent. Many providers haven't reported and USTelecom hasn't completed its full analysis, but the six ISPs typically account for 80-85 percent of annual broadband capex, he said. A previous report showed overall broadband investment dipped 4 percent 2014-16 to $75 billion and rebounded to $76 billion in 2017 (see 1810180029). "Previous US Telecom efforts to divine politically convenient conclusions from investment data have been thoroughly debunked by industry analysts and reporters," emailed Timothy Karr, Free Press senior director-strategy and communications, who didn't comment on its latest findings. "Investment cycles in tech rarely if ever swing on any single FCC policy. ... But that hasn't stopped industry lobbyists and trade groups from repeatedly boasting that [FCC] Chairman [Ajit] Pai’s decision to gut Net Neutrality has magically transformed the broadband industry into an investment-and-innovation fantasyland."

ANNAPOLIS -- Maryland shouldn’t wait for courts to rule on net neutrality before moving ahead with a law to restrict procurement to companies that follow such rules, Maryland Del. Kirill Reznik (D) told us Wednesday after the House Economic Affairs panel heard testimony on his net neutrality and ISP privacy bill (HB-141). Telecom and cable industry witnesses advised the state to wait at least until a ruling by the U.S. Court of Appeals for the District of Columbia Circuit, which heard argument last week on the FCC net neutrality order (see 1902010046). A House Communications Subcommittee hearing is Thursday (see 1902060036).

Federal judges pressed both sides on the FCC's net neutrality rollback case in oral argument (audio) at the U.S. Court of Appeals for the District of Columbia Circuit Friday. It ran almost four-and-a-half hours, almost twice what was scheduled, plus a break. All three judges questioned challenger contentions the FCC erred in reclassifying broadband internet access as a Communications Act Title I information service, particularly given Chevron deference to reasonable agency decisions on ambiguous statutes, including 2005 Brand X affirmation of Title I cable modem service. Two judges questioned FCC decisions, including to scrap net neutrality rules -- particularly for public safety operations -- pre-empt state and local governments, and use Section 257 authority for transparency rules.