FCC Chairman Disappointed Over Decision To Delay Phone-Rate Voting

By Dee Chisamera
13:05, November 4th 2008
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FCC Chairman Disappointed Over Decision To Delay Phone-Rate Voting

Federal Communications Commission Chairman Kevin J. Martin has halted the voting on the Intercarrier Compensation and Universal Service reform that figured in this week’s agenda, after facing increasing pressure from fellow commissioners, Congress and consumer advocates who believe these regulations would lead to higher phone bills for American consumers.

 In a public statement released on Monday, the Commission Chairman said he was “disappointed” they are missing the opportunity to go forward with the reform that has been under discussion for years. Martin said the delay means little progress, especially since his colleagues are apparently ready to ask questions on the reform plan that Martin doubts they will ever find answers for.

“I would like to be encouraged by my colleagues’ commitment that they will truly be ready to complete this much needed reform on December 18,” Martin wrote. However, he added, “I believe the far more likely outcome is that, in December, the other Commissioners will merely want another Further Notice and another round of comment on the most difficult questions.”

But while Martin expressed his disappointment, others believe the proposals on the two plans need to be carefully analyzed. As the Consumers Union pointed out, the changes in the way phone companies compensate each other upon transferring calls from one network to another will be directly reflected in consumer bills.

The National Association of Regulatory Utility Commissioners (NARUC) said in a statement following the FCC announcement that they are pleased with the decision to delay the voting. NARUC also expressed hoped that FCC Chairman Kevin J. Martin will soon share the ideas of his fellow commissioners, but also lawmakers, state regulators, industry and consumer groups, to open the proposals for public comment.

The $7 billion Universal Service Fund, which ensures that basic telephone services are affordable for people all over the country, no matter the income or the area they live in, has been put under scrutiny for mismanagement and fraud in some cases. Everyone agrees a reform is needed, but few agree on how the reform should be done.

At this point, the federal Universal Service Fund is based on extra-charges on interstate and international services, but also access charges, which are supported by long-distance companies. The problem is to establish the best way to ensure phone services for everyone at affordable prices, without increasing phone rates.

The Federal Communications Commission is in spotlight these days, as it is expected to cast its vote on the use of the “white spaces” for wireless broadband services. The proposal, highly supported by Google, Microsoft and other companies, is highly opposed by television broadcasters who believe the wireless devices will interfere with the TV signals.

In addition to that, the FCC is also looking into another matter, regarding the merger between Verizon Wireless and Alltel, or between Sprint Nextel and Cleawire. The last two are seeking approval for a nationwide WiMax wireless broadband network.



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