ViaSat disputed American Cable Association arguments on the FCC's planned auction of Connect America Fund Phase II subsidies for fixed broadband/voice services. "ACA incorrectly asserts that 'no US satellite broadband provider currently publicly offers 25/3 Mbps with a data cap of at least 150 GB.' ViaSat is already providing satellite broadband service at 25/3 Mbps with a 150 GB monthly data allowance," ViaSat said in a filing posted Wednesday in docket 10-90. Commissioners are scheduled to vote on bid weights and some other rules at Thursday's meeting (see 1702170048). ACA "misrepresents" satellite broadband costs for CAF II, including by assuming total costs would be $200 per subscriber, which ViaSat said was based on another entity's comment that doesn't apply to ViaSat. "ACA flatly ignores ViaSat’s unrebutted record evidence of the substantial costs involved in providing satellite broadband service," said the filing. It also disputed ACA claims that incremental satellite broadband costs for serving new locations were effectively zero. "ACA's comparison of the results of different weighting methodologies and its predictions of how different technologies would fare in the auction is misleading," ViaSat wrote. "ACA’s weighting scheme, like that proposed by the Rural Coalition, is just that: a carefully constructed scheme designed to ensure that fiber and cable technologies win -- and satellite providers lose -- no matter what prices the fiber and cable providers bid." ViaSat said it was making the filing under FCC rules to answer ACA's late submission, including over 20 pages of new material. In response, ACA called for rules maximizing broadband provider participation, "including those offering satellite, DSL, fixed wireless, and fiber," and driving bids "to their most cost efficient levels" using limited funds for the greatest benefit. "ACA examined the proposed weightings from all parties and the FCC by applying both public and private data on costs to all eligible census blocks for all technologies," emailed Ross Lieberman, senior vice president-government affairs. "This analysis demonstrated that ACA’s proposed methodology treated all technologies fairly. In fact, under ACA’s proposed methodology, contrary to ViaSat’s claim, satellite could do very well, notwithstanding that consumers rarely choose satellite today. In seeking to rebut ACA’s analysis, ViaSat does not undertake a rigorous analysis. Instead, it again does nothing more than use hypothetical bids numbers to produce 'guesswork results.'"

Judge Neil Gorsuch could share late Supreme Court Justice Antonin Scalia's antitrust views, BakerHostetler antitrust attorneys Carl Hittinger and Tyson Herrold said. Scalia had "admitted discomfort with the Sherman Act, specifically with holding corporate defendants, even monopolists, liable absent strong evidence of anti-competitive conduct," they wrote in a commentary. "His likely successor appears to possibly hold similar views of the antitrust laws, ostensibly applying the Sherman Act to avoid replacing procompetitive, free-market behavior with judicially imposed, anti-competitive fiat, based on the record presented." President Donald Trump tapped Gorsuch of the 10th U.S. Circuit Court of Appeals to fill Scalia's Supreme Court seat (see 1702010028). "Gorsuch has a long and storied background in antitrust work" as a clerk for Justices Byron White and Anthony Kennedy, in private practice, and at the 10th Circuit, Hittinger and Herrold wrote. "Perhaps Gorsuch's most significant antitrust decision was Novell v. Microsoft" in 2013, they wrote, noting the case arose out of Microsoft’s development of the popular Windows operating system and related applications, which competed with the applications of other vendors. They said Gorsuch’s opinion, affirming a U.S. district court ruling, "offers an incisive critique of the over-application of antitrust law." He "rejected the argument that Microsoft had to provide Novell with its intellectual property in order to avoid harming Novell’s marketing position. Such a judicially created edict, he explained, would 'paradoxically risk encouraging collusion between rivals and dampen price competition -- themselves paradigmatic antitrust wrongs,'" they wrote. Gorsuch also didn't believe in "forcing monopolists to hold an umbrella over inefficient competitors" that "leaves consumers paying more for less," and he voiced anxiety over courts making legislative-like decisions about competitors, they wrote.

The FCC said Electronic Document Management System problems Wednesday developed after "update and security patches" were applied to computer systems last weekend. "While these patches were tested and monitored for any unintended side-effects to IT systems, apparently a side-effect of the update patches presented itself a few days later," a spokesman emailed. "Working with vendors and system experts, the team quickly developed, tested, and rolled out a draft fix that we believe corrected the issue that the update patch introduced."

The FCC should adopt further process changes that give commissioners more say over bureau-level items and curb delegated authority, Commissioner Mike O’Rielly said in a blog post Wednesday. O’Rielly wants FCC procedures changed so two commissioners can block an item from being approved under delegated authority, the blog post said. Chairman Ajit Pai already reversed some policies approved on delegated authority under former Chairman Tom Wheeler (see 1702030070), but O’Rielly’s ideas would make it harder for such approvals to happen over the objections of commissioners, the blog post said. “The Commission delegates way too many substantive decisions to Bureau staff, usurping the role and obligations of duly appointed and confirmed Commissioners,” O’Rielly said. Allowing one commissioner to block delegated items could be unwieldy and cause too many delays, O’Rielly said. “If a Commissioner can't convince at least one other to join their cause, we should move forward posthaste,” O’Rielly said. The process changes would also include a requirement that commissioners receive 48-hours' notice before any item is decided under delegated authority, O’Rielly said. “This reasonable practice allows a sufficient timeframe for Commissioners to determine whether the proposed decision should be decided by the full Commission,” he said. Under the proposal, if two commissioners flag an item for removal from delegated authority, it should be voted by the full FCC within seven days or five business days to prevent undue delay, O’Rielly said. If the vote doesn’t happen in that time, the item would be approved by the full commission or released on delegated authority, O’Rielly said. “A requesting Commissioner that does not vote by the deadline risks the possibility that their failure to act would be deemed an approval and the item would be disposed of by the full Commission,” O’Rielly said. “Fixing the overuse of delegated authority should be high on our list of priorities as the new Commission examines internal process reform.”

A court agreed to an FCC request to hold in abeyance its review of a 2015 technology transitions order and a 2014 backup power order. The U.S. Court of Appeals for the D.C. Circuit issued a brief order (in Pacer) Tuesday granting an FCC motion -- which wasn't opposed by petitioner USTelecom -- and directing the commission to file status reports every 60 days starting April 24 in USTelecom v. FCC, No. 15-1414. The FCC sought the hold to give its new leadership time to decide on its course (see 1702070026). Then-Commissioner and now-Chairman Ajit Pai and fellow Republican Commissioner Mike O'Rielly dissented from the orders.

The FCC has a "laundry list" of ways to change course, many without notice and comment, said Wilkinson Barker attorney David Solomon, one of three former commission deputy general counsels speaking Wednesday on an FCBA panel. Beyond conducting new rulemakings, he said the commission can act on petitions for reconsideration or applications for review; issue declaratory rulings, policy statements, statutory interpretations, or other guidance; suspend enforcement proceedings or cancel pending notices of apparent liability and forfeiture; waive rules pending a rulemaking; or forbear from applying certain regulations. The agency can seek new public comment to build the record, said Solomon, who also was Enforcement Bureau chief. There's often interplay with the courts on recent decisions facing legal challenges, said Davis Wright attorney Peter Karanjia. He called it "pretty standard practice" for the FCC to file motions to hold a case in abeyance if there's a pending recon petition. The commission also can ask for a court remand, or even not defend prior decisions. He noted the FCC recently said it wouldn't defend parts of an inmate calling service (ICS) order; he called that "very unusual," but also said the circumstances were unusual, involving a 3-2 decision in which dissenting Republicans now are the majority, and a case that had been fully briefed. He said it was "interesting" that U.S. Court of Appeals for the D.C. Circuit Judge Laurence Silberman questioned at oral argument whether the FCC could, in effect, change ICS policy without going through notice and comment (see 1702060028). Karanjia said he wasn't sure there was any specific case law on the point: "So, we'll have to see." He said the FCC could issue a new declaratory ruling to reverse the 2015 broadband reclassification under Communications Act Title II, but it often "behooves" the commission to seek further public comment. Harris Wiltshire attorney Julie Veach, also a former Wireline Bureau chief, noted lawmakers could use the Congressional Review Act to undo the FCC's broadband privacy rules, appropriations "riders" or other targeted legislation to change agency policy, or simply pass new bills. She said recent FCC "information collections" are vulnerable, given the presidential change and Office of Management and Budget reviews under the Paperwork Reduction Act, which she said is a five-month process (including at the commission). When asked, no panelist commented on what net neutrality procedural path the FCC should pursue.

The FCC Disability Advisory Committee scheduled the first meeting of its second term March 21, the agency said Tuesday. The meeting will be 9 a.m.-1:30 p.m. in the Commission Meeting Room. This is the first DAC meeting under new FCC Chairman Ajit Pai. DAC members will discuss “(i) the roles and responsibilities of the Committee and its members; (ii) issues that the Committee will address; (iii) meeting schedules; (iv) issues to be assigned to each subcommittee; and (iv) any other topics relevant to the DAC’s work,” said a public notice.

Small entities can seek assistance on federal agency enforcement and compliance matters from the Small Business Administration's Office of the National Ombudsman, the FCC said in a news release Tuesday. The office provides various forms of assistance, including a one-page form letter to facilitate written comments on "any complaints, suggestions, or compliments concerning a federal agency's enforcement action," the commission said.

Verizon will buy Yahoo's operating business for $350 million less than Verizon's initial $4.83 billion offer and the companies "will share certain legal and regulatory liabilities arising" from the 2013 and 2014 data breaches that compromised a combined 1.5 billion Yahoo user accounts (see 1612150010), they said in a Tuesday statement. Under the amended deal, which is expected to close Q2, Yahoo will be responsible for 50 percent of cash liabilities incurred after non-SEC government investigations and third-party lawsuits related to the breaches are closed, the companies said. At least two dozen lawsuits have been filed against Yahoo after the company announced the breaches last year (see 1612230029) and lawmakers also are seeking answers (see 1702150070 and 1702100059). Yahoo would continue to be responsible for liabilities from shareholder suits and SEC probes, the news release said. The companies also agreed that the data breaches or any losses from them "will not be taken into account in determining whether a 'Business Material Adverse Effect' has occurred or whether certain closing conditions have been satisfied." Verizon Executive Vice President Marni Walden said the amended terms are "fair and favorable" for shareholders and the deal still makes "strategic sense." The company is seeking to increase its advertising business (see 1607250016). Yahoo CEO Marissa Mayer said the deal will "accelerate" the company's mobile operating business and separate its "Asian asset equity stakes."

FCC focus on a second phase of the Mobility Fund (MFII) and the Connect America Fund is laudable, but the fact remains that there are clear limits to the amount of subsidy money available in both programs, and tough policy calls will need to be made, said Joan Marsh, AT&T senior vice president-federal regulatory, Tuesday in a blog post. On MFII “as we understand it, the FCC has smartly pivoted toward assessing required LTE coverage based on geography, ensuring that winning bidders cover not only population centers, but also the various locations where community members work, farm, visit family and friends, and the points in between,” Marsh said. AT&T’s preliminary budget estimate is that available dollars will support an LTE build to only 70-80 percent of eligible areas, she said. The current proposal “would require winning providers to cover an average of 90 percent of the geography that the provider wins in a state, with no individual census tract falling below 75 percent coverage,” Marsh wrote. “While such a coverage requirement is certainly laudable, it will come with a significant price tag and will likely push bidders away from census tracks with extremely sparse populations or tough topography.” Changes to CAF pose similar challenges, Marsh said. “In the CAF II item, the FCC also will need to decide how to weigh bids for varying service levels, from a basic service of 10 Mbps/down to Cadillac services with gigabit download speeds,” she said. “The current proposal skews toward favoring fiber-fed services that will deliver gigabit speeds. Again, we do not fault the FCC for wanting to deliver gigabit speeds to rural communities. But setting weights that favor 1 Gig deployments will leave more than half of eligible consumers untouched by CAF II support and with little hope of being served in the future.” Commissioners vote on both issues Thursday.