FURCHTGOTT-ROTH TELLS RURAL TELCOS NOT TO REST HOPES ON WASHINGTON
SAN FRANCISCO -- Rural telcos will survive competitive inroads and threats to universal service funding, to thrive and help restore confidence in business, former FCC Comr. Harold Furchtgott-Roth said here Wed. But they will do so despite neglect of Washington policymakers obsessed with broadband and problems of industry giants, he told OPASTCO convention. None of top 5 issues highlighted on FCC Website involves rural telco issues, he said. “A lot of these problems have been around the last 6 years and nothing has been done about it. Just don’t look to Washington for help.”
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Universal service money is being diverted from rural telcos, including to competitors, in ways he and others never anticipated at time of 1996 Telecommunications Act, said Furchtgott-Roth, American Enterprise Institute visiting fellow. But he said FCC and Congress were preoccupied with big-company issues because they were glamorous and giants played Washington’s “quid-pro-quo” game.
Furchtgott-Roth cited example of U S West preparations to sue over FCC’s CALLS program on access and universal service charges, named for proponent Coalition for Affordable Local and Long-Distance Service. Litigation prospect suddenly disappeared when Qwest Communications agreed to buy U S West, he said. “You don’t make friends in Washington by threatening to sue.” Similarly, he said, WorldCom played along with “patently unlawful conditions” FCC imposed on its acquisition of MCI. And Global Crossing “threw a lot of money around Washington” to block undersea-cable competition. Those big companies failed, or stood at brink, despite direct access to agency heads rural telcos can’t reach, he said. Meanwhile, “FCC repeatedly kicked small telephone companies in the teeth.”
Universal service is being undermined by long-term slide in interstate call revenue that universal service funding is based on, Furchtgott-Roth said. He said FCC could step in to fix financing -- but same experts who supported Commission programs that lacked a statutory basis were strict constructionists on issue. “One of the FCC’s strengths is that it doesn’t move very quickly,” he said archly. “If it did, it would create a lot more problems.”
Responding to question, Furchtgott-Roth said: “I think the Commission is obsessed with broadband. Mine is probably a minority view, but I don’t think it’s healthy.” If carriers got everything they wanted on issue, “I don’t think it would make a whole lot of difference. I don’t think it would solve a lot of the problems the industry is facing.”