ILEC service quality is falling short in California, some stakeholders fear. The California Public Utilities Commission posted several comments this week on whether and how the CPUC should identify and potentially correct the facilities of the two major ILECs in the state that have been shown in the past to struggle with service quality. AT&T and Verizon argue for a limited study of their facilities with a specific focus, while others want a broader, critical look at their services.

It’s unclear how a deal to consolidate control of Verizon Wireless would change the overall dynamics of the market, industry experts told us Monday following renewed speculation that Verizon Communications was more seriously considering options for acquiring Vodafone’s 45 percent ownership of the No. 1 U.S. wireless carrier.

Public interest groups are expressing some concerns about the potential appointment of Tom Wheeler as the next chairman of the FCC, replacing Julius Genachowski (CD March 25 p1). At least one official has signaled to the White House public interest groups could live with the choice, sector officials said Monday. Wheeler, 66, managing partner at Core Capital Partners, was president of CTIA from 1992 to 2003 and CEO of NCTA from 1979-1984.

The Senate voted late Friday to approve a budget amendment that would allow states to collect e-commerce sales taxes on in-state purchases from companies that do not have a physical presence in those states. The amendment, approved 75-24, was offered by Sens. Dick Durbin, D-Ill., and Mike Enzi, R-Wyo.

Don Lewis has spent 23 years as prisoner number 1049536, held by the Virginia Department of Corrections. Phone calls used to be inexpensive, Lewis wrote in careful cursive to the FCC. Not anymore. Lewis has watched as the price of calls increased to $7 for just 20 minutes, beset by a bevy of fees and surcharges. Given the current state of technology, why can’t inmates Skype with family members, he wonders? Why can’t they text? “The state should be encouraging stronger family ties, instead of focusing on the money they make from the misfortunes of others,” he said. “It’s not a lesson you'd want to teach your children."

Otelco, a wireline provider for several states, filed for Chapter 11 bankruptcy protection in Delaware Sunday, in order to restructure. The company, which is incorporated in Delaware, has $168.5 million in assets and $310.06 million in total debt, according to documents filed at the Wilmington, Del., bankruptcy court. Otelco operates 11 RLECs throughout Alabama, Maine, Massachusetts, Missouri, Vermont and West Virginia as well as two CLECs providing telecom service in Maine, New Hampshire and Massachusetts and is “the sole wireline telephone services provider for many of the rural communities it serves,” the documents said.

FCC Chairman Julius Genachowski said Friday he will leave the FCC in a matter of weeks. Industry officials told us they expect an announcement from the White House as early as this week on a replacement, with former CTIA and NCTA President Tom Wheeler still considered the likely front runner. In the interim, industry and government officials expect the White House to designate Commissioner Mignon Clyburn as the first woman to chair the commission, until a new permanent chairman is confirmed and in place.

Susan Crawford remained positive when discussing the exit of the FCC chairman on the morning he announced his departure. (See separate report in this issue.) “Julius Genachowski is an unfailingly gracious, kind man,” she said on stage after her Friday keynote at the SouthEast Association of Telecommunications Officers and Advisors meeting in Charlotte, N.C. “He catered to a situation in which he felt his freedom of action was quite strained.”

Republican Senate Commerce Committee members want new FCC leaders that will keep the U.S. telecom marketplace competitive and ensure the reallocation of more spectrum for commercial wireless use, they said in separate interviews Friday. Their comments followed the announcements last week that FCC Chairman Julius Genachowski and Commissioner Robert McDowell plan to depart the agency in the coming weeks (see separate report in this issue). President Barack Obama did not announce Friday his nomination to succeed Genachowski, but former CTIA and NCTA President Tom Wheeler remains the front runner for chairman, industry officials and Hill aides said Friday.

Broadcasters and their consulting engineers clashed with the consumer electronics and wireless industries over the merits and legality of updating the FCC’s DTV interference software for the purposes of calculating interference between stations after the planned spectrum incentive auction. The commission released an updated version of its interference prediction software described in the FCC’s Office of Engineering and Technology Bulletin 69 (OET-69) called TVStudy last month and asked for feedback on it (CD Feb 6 p10). CEA and CTIA each urged the agency to use the proposed changes, which they say will make the software more accurate.