FCC issues proposals to meet national broadband plan

By Cecilia Kang
Washington Post Staff Writer
Thursday, December 17, 2009

The Federal Communications Commission on Wednesday unveiled a laundry list of proposals to meet a congressional mandate to give every U.S. home access to high-speed Internet service.

The recommendations, which come just two months before the agency must present its final national broadband plan to Congress, include revising a rural phone subsidy program, revamping the market for television set-top boxes and redirecting more airwaves to wireless services.

Many of the ideas were widely expected and have already angered different corners of the communications sector as well as public interest groups, which argue that the proposals don't do enough to encourage more competition in an industry dominated by AT&T, Verizon, and Comcast.

One proposal floated by the agency's broadband task force calls for using money from the Universal Service Fund, which subsidizes rural phone service, to pay for adding high-speed Internet capacity in remote and low-income regions of the country. The program raises about $7 billion annually from fees on long-distance phone service, and the idea of redirecting those funds has upset rural phone carriers, which have come to rely on the subsidies.

"It's tempting to kick the can further down the road," said FCC Chairman Julius Genachowski, referring to the Universal Service Fund. "But for many reasons it's important to begin tackling these issues now. We must make sure that the fund fully supports the technology of today and tomorrow, not just the technology of the past."

The FCC also recommended allocating some airwaves from television broadcasters to wireless broadband to support the next generation of iPhones and BlackBerrys. That has upset broadcasters, which want those airwaves for mobile television services.

The agency also discussed revamping the television set-top box market, which has been slow to change and is dominated by a few players that work directly with cable and satellite providers to lease the boxes to customers. Nearly every home has a television, and the FCC thinks that set-top boxes could eventually be a gateway for Internet services.

In his report, Blair Levin, head of the FCC's broadband task force, raised the idea of forcing cable and satellite operators to supply low-cost set-top devices that would integrate broadband and video services. The cable industry supports the FCC's review of the set-top box market and says that electronics makers haven't done enough to produce better boxes.

Consumer advocate Marvin Ammori, a law professor at the University of Nebraska at Lincoln, says that because most customers get their boxes directly from cable companies, it's the cable providers that essentially control the market for the devices.

"The idea for the cable industry is that they want everyone to go to their channel box and the platform they control because if content were to be available online in the way consumers want, they would cut their cable subscription," Ammori said.

Gigi Sohn, executive director of Public Knowledge, a public interest group, said she was disappointed that the FCC didn't propose giving smaller telecom firms easier access to lines owned by the dominant companies so that they can better compete.

"Reforming universal service and supporting municipal networks are worthwhile goals, but they would do nothing to reverse the slide caused by eight years of misbegotten telecommunications policies that have crippled the most meaningful broadband competition for consumers," Sohn said in a statement.

© 2009 The Washington Post Company