Supporters of the Universal Service Fund overhaul agreement brokered by USTelecom asked the chairmen and ranking members of the House and Senate Commerce committees and their communications subcommittees for support. A Thursday letter was from USTelecom, AT&T, Verizon, CenturyLink, FairPoint, Frontier, Windstream, OPASTCO, the NTCA and the Western Telecommunications Alliance. “This universal service fund (USF) and intercarrier compensation reform framework represents the country’s best chance to stabilize, modernize, and expand rural networks for years to come,” the coalition said. “With our carefully balanced compromise, we believe the industry can work through a major transition process without damaging vital communication infrastructure or disrupting customer services.” The FCC has said it hopes to complete reform this fall, the coalition noted. “After years of frustration and dead-ends, we are on the precipice of reform and now have a rare opportunity to push for significant change in these vital programs. Please join us by encouraging the FCC to make this reform a reality.” In a letter to FCC Chairman Julius Genachowski, Arkansas Gov. Mike Beebe urged the FCC “to take advantage of this historic opportunity” presented by the broad industry agreement on universal service and intercarrier comp revisions. “We may never see a better chance than this, and it’s time to end the waiting for those without broadband,” Beebe, a Democrat, wrote in a letter dated and released Thursday.

Leaders of the three mid-size telcos that signed the USTelecom-brokered universal service and intercarrier compensation reform proposal urged FCC Chairman Julius Genachowski Wednesday to implement the proposed reforms “in the near-term” and “simultaneous adoption” of the plan. CenturyLink CEO Glen Post; Frontier Chairman Maggie Wilderotter and Windstream CEO Jeff Gardner told Genachowski in a letter that they “believe that the time to act on comprehensive reform of both universal service and intercarrier compensation is now.” The telco plan (CD Aug 1 p1) “required compromise, perseverance, and a leap of faith by all involved,” the executives said. “That is why we urge you to move forward expeditiously to adopt America’s Broadband Connectivity Plan in full."

Free Press criticized FCC Chairman Julius Genachowski’s endorsement of usage-based pricing. “While the rest of the world is moving away from this type of price-gouging, it is puzzling why the FCC chairman would endorse a practice that in the long run will relegate the United States to an Internet backwater,” Research Director Derek Turner said Wednesday. Genachowski said the day before that usage caps such as those used by AT&T and Verizon “fundamentally” may “provide consumers more choice.” The FCC’s December net neutrality order contemplated usage-based pricing, but left it to “markets” to decide how to handle it. Turner said such pricing plans could help low-volume users “in theory. But the industry is not contemplating any such thing, because it runs counter to the fundamental network economics of their industry, and because doing so would not help them achieve their primary goal -- continued explosive growth of profits. They're simply not looking to charge low-volume users less -- over time, they want everyone to pay more.” USTelecom spokeswoman Anne Veigle said data usage has exploded, and usage-based pricing helps makes sure that those who benefit most, pay the most. “To keep up with this demand, the broadband industry invested an average of $66 billion per year from 2005-2010, with wireline companies contributing the lion’s share, $30 billion per year, compared to wireless at $23 billion and cable at $13 billion,” Veigle said. “Who should bear the cost of this investment? Given that the top 10 percent account for 60 percent of traffic, fundamental fairness dictates that those whose demands are less should not be required to subsidize those who are consuming the greater capacity, imposing the greater costs, and deriving the greater benefit."

There’s no reason to expand telecom outage reporting mandates from traditional phone service to VoIP, broadband and backbone service providers, said all corporate filings to the FCC. There are major differences between outages on public switched telephone networks (PSTN) and on broadband and other newer networks, associations and companies said. But states said such outage reporting is needed, given increasing reliance on VoIP to make calls instead of circuit-switched phone networks, and because Internet networks carry calls to 911. The FCC proposed (http://goo.gl/09KYY), amid concerns of Commissioner Robert McDowell, to extend Part 4 rules to ISPs, backbone services and VoIP for outages of at least a half-hour (CD May 13 p9). Comments were posted Monday and Tuesday in docket 11-82 (http://goo.gl/boqUK).

Northern Valley Communications and Kentucky Telephone complained about rules designed to curb “so-called ‘access stimulation,'” in an ex parte filing in docket 01-92. “Ultimately, at a time when the nation’s economy remains in peril and the Chairman is focused on how technology and innovation can create jobs for Americans, the rules proposed by the FCC are unwarranted,” the companies said. “These proposed new regulatory burdens would serve only to kill jobs in rural America, and by attacking free conference calling services would make it more expensive for small businesses and entrepreneurs to collaborate on their ventures.” The companies also took a look at the USTelecom-brokered agreement on Universal Service Fund and intercarrier compensation reform (CD Aug 1 p1). “While the approach suggested by these carriers has many flaws which counsel against its adoption, we noted that this or similar proposals would effectively moot the need to adopt rules specifically addressed at ‘access stimulation,’ because the industry-wide transition to such low rates would effectively prevent carriers from having sufficient revenues to share with their end user customers,” the companies said.

Windstream’s Q2 profit was $93.2 million, up from $79 million in the same period last year. Though more work needs to be done, the USTelecom-brokered USF proposal is a good start, CEO Jeff Gardner said during an investor call Friday.

FCC Chairman Julius Genachowski’s effort to issue another joint public statement by the FCC commissioners on Universal Service Fund and intercarrier compensation system reform appeared to be in flux late Thursday, agency officials said. Genachowski had hoped to get his colleagues to sign another Web post, as they did in March. Then, the full commission had promised “a busy spring and summer” of reform work and a promise to move to order’s “within a few months” of the comment cycle’s end in May (CD March 16 p10). Commissioners apparently couldn’t agree on language in the proposed new post, the officials said. Efforts to reach Genachowski’s spokesman for comment were unsuccessful at deadline.

The House sponsors of last year’s Universal Service Fund overhaul bill support the FCC acting on the industry USF agreement brokered by USTelecom. Rep. Lee Terry, R-Neb., no longer plans to move USF legislation, aide Brad Schweer told us Wednesday. He said that Terry “will now be encouraging the FCC to produce details that reflect suggestions” proposed by the industry group. Terry’s former co-sponsor Rick Boucher agreed that the commission should move forward on its own.

Nearly all of the telcos that have borrowed from the Rural Utilities Service receive high-cost Universal Service Fund support, RUS said in an analysis (http://xrl.us/bk3xqr). Of the 480 companies that have borrowed for telecom infrastructure, 476, or 99 percent of them, receive interstate universal service cash, the RUS said. More than 70 percent of RUS’ borrowers rely on universal service for more than a quarter of their operating revenue, RUS said. A 5 percent reduction in universal service cash would strand some 98 borrowers, representing nearly $794 million in loans, RUS said. The three largest rural telecom associations, calling themselves the Save Rural Broadband alliance, seized on the RUS filing, saying it was “independent confirmation of a point Save Rural Broadband has long argued -- the FCC’s USF reforms will force many rural broadband providers to either delay their deployment of broadband services or go out of business.” Rural carriers made a separate peace with bigger incumbents last week and filed a “complementary” brief with the USTelecom-brokered industry agreement (CD Aug 1 p1). A spokesman for the three associations said the RUS filing had no bearing on the incumbent compromise.

Rural Cellular Association President Steve Berry sharply criticized the Universal Service Fund/intercarrier compensation proposal formally filed by a U.S. Telecom-organized group of carriers at the FCC Friday (CD Aug 1 p1). He argued it’s a wireline-centric plan that largely leaves wireless in the cold. Berry called the proposal “a joke.” RCA represents small to mid-sized carriers. Satellite broadband companies, who also were not part of negotiations on the proposal, also criticized it Monday. Consumer groups and states’ rights advocates expressed concerns, while executives representing small and mid-sized cable operators expressed support for elements of the plan.