Extending the Universal Service Fund to broadband won’t be easy but is the right approach, FCC Commissioner Mignon Clyburn said in a speech at the Telecommunications Policy Research Conference at George Mason University Law School. That recommendation is a key part of the FCC’s National Broadband Plan, released in March. “It’s never easy when you discuss reforming a system that many have come to rely upon,” Clyburn said late Friday. “But what the plan recognizes is that our current system just isn’t very efficient. We can do better, and we need to make the most out of the system we have.” She noted that according to the plan 14-24 million Americans lack access to broadband. “There are those who say we should be satisfied that 95 percent of American households have at least one wireline broadband provider available,” Clyburn said. “If you haven’t heard, I don’t fall into that camp. I believe it is imperative to provide every single American household the opportunity to connect so that they can fully participate in the digital world.” She said she expects the FCC to take up next month a proposal for a broadband mobility fund. “Wireless consumers expect to have coverage, no matter their location,” Clyburn said. “While certain geographical and topographical barriers may be too difficult to overcome in the short-run, that is not the case for all unserved areas.” She also emphasized that academics have an important role at the FCC. “Through observation and study, we can better assess our choices -- make modifications as necessary -- and further improve our policies to better serve the American people,” she said.

The FCC should “peel away” some of the least contentious problems in a Universal Service Fund overhaul “instead of trying to boil the ocean,” Frontier Chairman Maggie Wilderotter told us Monday. Wilderotter was in town for an unrelated conference but met Monday morning with Chairman Julius Genachowski’s chief of staff, Eddie Lazarus. She said the commission could more easily tackle problems like phantom traffic. “That’s a big area they could clear up,” she said. “They have the authority to do that tomorrow” by subjecting all calls, even Internet voice, to USF charges and by changing the formula so it reflects the actual costs of service.

Stratos Government Services urged the FCC to publish a rulemaking notice about extending the universal service fund exemption to government subcontractors. The “issue is ripe for decision,” the company said in an ex parte filing Friday.

should be kept “as a potential down payment on proposed broadband universal service reforms … including to index the E-rate funding cap to inflation.” Sprint and Verizon had agreed in merger commitments to leave the money in the pool. The petition asks the FCC to drop the Corr Wireless decision and grant Corr’s entire request for review. “In its well-intentioned zeal to implement the National Broadband Plan, the Commission has put the cart before the horse and strayed from the requirements of the Communications Act,” the petition said. “In so doing, the Commission risks undermining its efforts to implement sustainable universal service reform and inciting years of litigation that would slow broadband deployment by creating regulatory uncertainty.” The Act doesn’t given the FCC authority to set up an account “to be used for unspecified purposes at an undetermined point in the future,” the petition says. “The Act, which originated in the Senate, could not authorize the Commission to do so without itself violating the Origination and Taxing Clauses of the United States Constitution.”

Talk at the FCC of Universal Service Fund reform to include broadband services has satellite companies concerned over the possibility of increased contribution rates without any subsidy in return, industry executives said. Under the current system, companies pay into the USF based on their interstate and international end-user telecom revenue and generally leave satellite companies out of the running for subsidies. If a future version of the USF includes broadband, as proposed by the FCC and tentatively named the Connect America Fund (CAF), satellite companies could be left paying for expansion of competing technologies again, executives said.

Universal Service Fund support “helped the company build hundreds of cell sites and deliver high-quality services to many rural areas that have been unserved or underserved since the inception of cellular service twenty years ago,” Cellular South representatives said during a meeting with FCC staff. It also discussed the “difficulties inherent in a competitive auction mechanism” for distributing universal service support and possible alternatives, including “using a model to establish an amount of support for high-cost areas, which would be available to any carrier with the ability to serve and capture customers,” the company said in an ex parte filing.

A handful of companies have turned down loan awards from the Broadband Initiatives Program, and officials in the U.S. Agriculture Department’s Rural Utilities Service are in negotiations to get the companies to stay with the program, a RUS spokesman said. “Fewer than 10” of about 300 grant winners have turned down awards, he said.

Two wireless and one video item will get FCC votes Oct. 14 under the preliminary meeting agenda released Thursday. An order on CableCARDs will change the rules to make it easier for consumers to use set-top boxes and other devices that connect TVs and other products to cable systems and that aren’t provided directly by the operator. That item was expected to get a vote at the meeting (CD Sept 20 p3). A rulemaking on what the FCC calls bill shock will seek comment on rules requiring carriers “to provide usage alerts and related information that will assist consumers in avoiding unexpected charges on their bills,” the agency said. Another rulemaking seeks feedback on using Universal Service Fund money to start a fund to support corporate investment in 3G and next-generation services in places where they're not available.

The FCC approved an order letting schools and libraries lease dark fiber for broadband use, community use of schools’ broadband networks after hours and tying the E-rate cap to inflation. Indexing E-rate to inflation, as had been expected (CD Sept 8 p1), may mean the $2.25 billion annual cap will be raised for the first time in its history. The inflation measure caused Republican Commissioners Meredith Baker and Robert McDowell to part ways with their Democratic colleagues. Baker concurred on inflation and McDowell dissented. Both said they thought the Universal Service Fund -- of which E-rate is a part -- requires comprehensive reform.

Members of the newly reconstituted Wireless Innovation Alliance said in a call with reporters Wednesday the FCC shouldn’t weaken its white spaces rules through changes sought by broadcasters and others. Representatives of Public Knowledge, Google and Dell spoke on the call. A vote on the white spaces order is scheduled for Thursday, though aspects of it were still being worked out at our deadline, agency officials said. The FCC released its sunshine notice last Thursday, cutting off lobbying, though industry officials can still answer questions sent their way by the FCC.