December 21, 2009 - NTCA Outlines Plan for Transition to Broadband Network

Urges consideration of ample transition period to avoid harming consumers

Arlington, Va., (December 21, 2009) - The transition to a broadband universal service mechanism must be done carefully, prudently and within a reasonable time period so that rural consumers are unharmed in the process, the National Telecommunications Cooperative Association (NTCA) said in comments to the FCC in its notice #25 of the national broadband plan.

In the comments, NTCA cited its own national broadband plan and pointed specifically to eight elements contained in its plan that are critical to small rural providers undergoing the transition from the public-switched telephone network (PSTN) to an all-IP network.

To ensure consumers' ability to retain essential communications services, and rural providers' ability to offer transparent choices and maintain financial incentives for continually improving services, NTCA urged the commission to:

  1. Transition high-cost universal service fund (USF) voice support to high-cost USF broadband support over a reasonable period of time;

  2. Maintain rate-of-return (RoR) regulation and study area average costs for rural ILECs throughout the transition period;

  3. Allow RoR carriers to receive high-cost USF support for stand-alone DSL during and after the transition period;

  4. Require interconnected voice over Internet protocol (VoIP) traffic to pay access charges throughout the transition period;

  5. Allow state commissions to reduce intrastate tariffed access rates to interstate tariffed access rate levels within five years, while at the same time freezing interstate access rates.

  6. Create an access rate cost recovery restructure mechanism (RM) for lost access revenues;

  7. Retain carrier of last resort (COLR) obligations for USF recipients during transition to protect rural consumers; and

  8. Apply the Regulatory Flexibility Act, 5 U.S.C. § 610 et seq., when crafting the IP transition rules for small business entities, which include small rural ILECs.

In the comments, NTCA said a gradual transition from circuit-based USF to an IP-broadband world will avoid rate shock, prevent service disruptions, and provide stability and certainty during the transition period.

"It is critical that the progress gained under existing high-cost USF (particularly in areas served by rural ILECs) not be inadvertently disrupted with a premature, unwarranted discontinuation of existing High-Cost programs" NTCA said in the comments. "Without careful thought to this IP transition, the Commission could not only thwart additional investment but could also jeopardize the service that has been successfully deployed today."

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The National Telecommunications Cooperative Association is the premier association representing more than 560 locally owned and controlled telecommunications cooperatives and commercial companies throughout rural and small-town America. NTCA provides its members with legislative, regulatory and industry representation; meetings; publications and educational programs; and an array of employee benefit programs. Visit us at Caitlin Colligan at 703-351-2086