Commissioner Robert McDowell said the FCC appears to be moving too slowly to wrap up all aspects of Universal Service Fund reform, including the Rural Health Care Program. His remarks came in a speech Thursday at the Mid-Atlantic Telehealth Resource Center Summit in Charlottesville, Va. The FCC approved last year the start of USF distribution reform and an order on the Lifeline program in January. But other work remains to be done, McDowell said. “I understand that some of you have been anxiously waiting for the FCC to move forward on finalizing our efforts to reform the rural healthcare program,” he said. “So have I. As part of the implementation of that plan, the commission has already reformed some of the other USF programs on a piecemeal basis.” McDowell said that in a “perfect world” the agency would have taken on all USF spending programs at the same time, while also completing contribution reform. “Consistent with my long-standing advocacy for truly comprehensive reform, I will continue to press the commission to complete all of its reform efforts, including reform of the rural healthcare program, as quickly as possible,” he said. McDowell said he saw the importance of telehealth during a trip to Alaska during his first year as a commissioner. “The most memorable portions of the trip were the health clinics,” he said. “There I could see how medical images from the most remote corners of Alaska were transmitted to specialists in Anchorage. I learned how using telehealth technology can actually save money because, in many instances, having that technology close at hand means the patient can avoid flying hundreds of miles to a hospital.” McDowell noted that while the FCC created the healthcare program in 2007, it asked for comments on possible changes in 2010. “The commission has not only garnered valuable information from those who commented but also has learned a tremendous amount from participants in the pilot program,” he said. “All of this information will be incredibly valuable as the commission moves to the next step in the reform process."

The District of Columbia Public Service Commission (DCPSC) and the District Department of the Environment (DDOE) sought clarification that in jurisdictions that have state universal service funds but no authority over wireless, wireless ETCs are the entities responsible for certifying the Lifeline eligibility of their customers, an ex parte filing (http://goo.gl/WJCbd) with the FCC said. In the District of Columbia, the PSC is expressly prohibited by law from exercising any jurisdiction over wireless carriers, the filing said. Meanwhile, DDOE indicated that the Department of Human Services’ Economic Security Administration (ESA) performs verification activities for other federal assistance programs like Temporary Assistance to Needy Families, Medical Assistance and Supplemental Nutrition Assistance Program (formerly Food Stamps). DDOE noted its ability to access information from the ESA database is “very limited” while the DCPSC has no access to information in the ESA database.

The Universal Service Fund contribution factor will decrease to 17.4 percent for Q2, the FCC said Tuesday, from a Q1 factor of 17.9 percent. The Universal Service Administrative Co. determined the contribution factor by dividing the projected total program collection of $2.4 billion by the projected adjusted quarterly contribution base of $13.9 billion, and then rounding up to the nearest tenth of a percent. NTCA Senior Vice President Michael Romano said fluctuations in the contribution factor from quarter to quarter cannot mask the need for comprehensive contribution reform. “While some may paint with a broad brush, the fact is that the high-cost portion of the federal universal service program has not increased materially in several years -- the most significant growth in demand has come from other parts of the fund,” he told us. “Until the FCC addresses in a targeted way these specific demand issues and until it reforms the contribution mechanism to ensure that all who use broadband-capable networks contribute to their availability and affordability, these concerns will linger and debate will recur every calendar quarter."

Utah legislation that prohibits state regulation of VoIP services recently passed the House and Senate and is awaiting Republican Governor Gary Herbert’s final say. SB-229 is sponsored by Republican state representative John Dougall. The regulatory prohibition doesn’t affect or limit the enforcement of criminal or civil laws, including consumer protection and unfair or deceptive trade practice laws, the bill text said. The prohibition doesn’t affect the assessment of taxes, 911 fees, the Universal Service Fund, telecom relay or public utility regulatory fees.

The FCC should wrap up this year an order providing for interoperability in the lower 700 MHz band, representatives of Vulcan Wireless said in a series of meetings at the agency. Creating a single band class in the band would “provide the certainty necessary for Lower 700 MHz A Block licensees to meet their looming build-out deadlines as well as upcoming USF mobility fund deadlines, allowing them to compete for universal service and other broadband funds intended to spur mobile broadband development in rural areas,” Vulcan said (http://xrl.us/bmxy5d). An interoperability requirement would also “address the ’spectrum crunch’ by unleashing 12 MHz of valuable and immediately available spectrum for competitive wireless broadband service.” The commission is slated to vote on a 700 MHz interoperability rulemaking notice at its March 21 meeting.

Walmart Entertainment announced its Vudu-based Disc-to-Digital service Tuesday at a news conference webcast. John Aden, executive vice president of general merchandise for Walmart, said the service would enable consumers to enjoy the content they already own on DVD “while unlocking value in the investment they've already made."

Walmart Entertainment announced its Vudu-based Disc-to-Digital service Tuesday at a news conference webcast. John Aden, executive vice president of general merchandise for Walmart, said the service would enable consumers to enjoy the content they already own on DVD “while unlocking value in the investment they've already made."

Several carriers filed reply comments Friday about proposed competitive bidding procedures for Auction 901, which will disburse $300 million in the upcoming Mobility Fund. The FCC’s proposal to allow bidders to submit package bids on bidder-defined census block aggregations “increases the complexity of the auction greatly and introduces additional problems,” AT&T said, echoing a group of academic experts on auctions. The Universal Service Fund/Intercarrier Compensation order determined that support should be provided on a census block basis, and a subsequent public notice proposed that individual bidders submit up to three package bids per Cellular Market Area based on those aggregations. The problem is that combinatorial auctions make it more difficult to determine winners, and could in fact make it impossible “due to issues of computational complexity,” said AT&T, quoting comments made by the professors. A combinatorial auction will also create “significant opportunities for strategic manipulation of the auction,” and introduce the possibility of overlapping bids, which would only exacerbate things, AT&T said. U.S. Cellular said the requirement for a letter of credit is “burdensome and unnecessary,” and would “impede investment in mobile broadband infrastructure.” U.S. Cellular also said the Commission should delay the auction pending the result of litigation challenging the source of the $300 million in funding. The Rural Telecommunications Group said the proposed American Roamer data and road categories are insufficient to determine and measure eligible areas, because the data could be inaccurate.

The FCC’s proposed methodology for setting an upper limit of high-cost loop support paid to incumbent rate-of-return LECs is fundamentally sound, but needs additional analysis of specific implementation issues, said two economists asked by the Wireline Bureau to do peer reviews (http://xrl.us/bmxvwu). The Universal Service Fund/intercarrier compensation order adopted a rule to limit reimbursable capital and operations expenses relative to a LEC’s “similarly situated” peers.

Changes in the Universal Service Fund are throwing many rural carriers into confusion about how to keep afloat once the USF spigot is turned down starting July 1. Companies that invested heavily in rural broadband say new rules limiting reimbursable capital and operating costs mean they won’t be able to repay loans. Others question the “safety net additive” reforms that they say unexpectedly eliminated promised financial support. The end result, rural carriers say, will be decreased investment in broadband, and an inability to maintain the phone lines currently in place.