Most important universal service issues pending before FCC, accor...

support for nonrural telcos. Abernathy said she would like to have had action already, “we need to get back to the court.” (2) Action on “contribution methodology,” issue teed up for agenda meeting Thurs. She said FCC had to look at how it collected universal service contributions in light of declining revenue and new technology. (3) Effect on universal service funding of “migration of technology to new digital platforms.” Depending on how those new technologies are defined, move to digital technology could eliminate providers’ obligations to contribute to universal service, she said. That could jeopardize current funding structures and place “tremendous burden on isolated users,” she said. Abernathy spoke at FCBA brown-bag lunch on universal service. She also said she would like to see data developed to compare telephone penetration rates vs. universal service funding vs. use of Lifeline and Linkup programs. She said it would be interesting to see whether data showed relationships to guide FCC and states in upcoming proceedings. Asked about universal service funding restrictions for rural LECs that buy exchanges from Bells, Abernathy said that’s tough policy decision. Some rural customers are “probably better off” with smaller telcos but “you don’t want to create a land grab” mentality, she said. Nanette Thompson, Alaska Regulatory Commission chmn., who also was featured at lunch, said that when GTE sold off exchanges in Alaska, smaller company bought them knowing it might not get much universal service funding but “they were willing to make the investment anyway.” She said that was “some of the worst plant in the state” and regulators were “happy to see a small company, closer to the community, take over.” On issue of universal service portability, Abernathy said it was difficult to determine whether competitors should get support based on incumbents’ costs or their own costs. She said it struck her as odd for competitors to get support based on incumbents’ costs. It doesn’t appear to be good long-term business plan for competitor, she said: “I don’t like to create uneconomic incentives like that.” Thompson said she agreed, but said it was difficult to determine CLEC costs because PUCs traditionally hadn’t sought as much information on them: “The prospect of having to learn the costs of CLECs troubles me.” Some have advanced idea of giving CLECs support based on either ILEC costs or unbundled network element (UNE) rates, whichever is lower, she said. Thompson said that would be “a good incentive for ILECs to set UNE rates right.”