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ACA Asks FCC To Modify Or Eliminate Series Of Telecom Regs Burdensome To Smaller Providers

Biennial Review Should Be Start Of Much Larger FCC Effort To Pare Regulatory Burdens

PITTSBURGH, January 5, 2017 - The American Cable Association submitted reply comments in response to the Federal Communications Commission's request for public comment in its 2016 Biennial Review of telecommunications regulations. Congress authorized the FCC to rely on the biennial process as a means of modifying or eliminating regulation that the agency finds no longer serve the public interest.

"ACA believes this review provides a valuable opportunity for the new FCC to review regulations that apply to the operations or activities of any provider of telecommunications service and either eliminate regulations that are not in the public interest or modify them to ensure they serve the public interest," ACA President and CEO Matthew M. Polka said. "The FCC should adopt the ACA's recommendations in full.  In addition, the FCC should view ACA's recommendations and its own actions in this proceeding as a mere down payment on a more comprehensive effort to identify and trim a vast array of regulations that unreasonably burden smaller providers, including those affecting providers of Multichannel Video Programming Distributor (MVPD) services."

ACA submitted the following regulations affecting providers of telecommunications services that should be eliminated or modified:

Universal Service Fund Contributions: ACA agrees with the FCC's view that "[t]oday's de minimis exemption creates administrative burdens and uncertainty for many qualifying providers and [the Universal Service Administrative Company (USAC)]." Reforming the de minimis exemption is one of the most important modifications the FCC could make to ease the burden on smaller telecommunications providers, enabling them to use their resources more efficiently to invest and enhance competition. ACA proposes the FCC modify the de minimis threshold by determining the threshold on the basis of assessable revenues and by increasing the threshold at least to its original de facto level of $200,000 in assessable revenues.

Revise Downward The VoIP Safe Harbor: The FCC should revise downward the safe harbor for allocating VoIP traffic as interstate from the level of 64.9% adopted in 2006 because it is a highly inflated proxy for interstate revenues not accurately reflecting today's mix of traffic. In 2012, the FCC indicated that the "average percentage for VoIP traffic studies is 22.1% interstate/international, with the median study reporting 14.7% interstate/international." Because the safe harbor is set so high, many providers find it more economical not to use it.

Repeal Unnecessary Traffic Study Requirements: Should a provider seek to use traffic studies to allocate the jurisdictional percentages of its VoIP revenue, it currently needs to submit a traffic study with each quarterly Form 499-Q. From the perspective of a smaller provider, this imposes a significant administrative burden and legal cost. Additionally, it is unnecessary because quarterly filings are simply estimations of projected revenue in the first place and do not establish a contributor's ultimate liability.

Broadband Reporting Form 477 (Part 1): The FCC should modify Form 477 filing requirement by permitting smaller providers to file annually instead of semiannually. By adopting such an approach, the FCC would have sufficiently accurate data from small providers while lessening the burdens on them.

Rural Call Completion (Part 64):  While ACA continues to be concerned about rural call completion problems and supports government efforts to alleviate them, there is good reason for the FCC to modify the definition of "covered provider" to raise the subscriber line threshold so that it covers voice providers that make the initial long distance call path choice for more than 250,000 domestic retail subscriber lines.  To the best of ACA's knowledge, there have been no complaints about small, and even mid-sized, providers not completing calls. At the same time, ACA members with more than 100,000 subscriber lines find that the burdens of compliance have been significant.

Pole Attachments (Part 1, Subpart J): The FCC's longstanding interpretation of Section 224 of the Communications Act, as amended, is that while competitive local exchange carriers (CLEC) can demand access to incumbent local exchange carriers' (ILEC) poles, ducts, conduits, and rights-of-way, ILECs cannot demand such access from CLECs. ACA is opposed to a request to change that. Given that the FCC recently addressed this issue and reaffirmed its statutory interpretation, there is no basis for it to revisit its action and certainly no basis to change course. Further, ILECs are not similarly situated to other telecommunications providers; they continue to control access to poles and other infrastructure that are fundamental to the deployment of networks by other providers

About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 750 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America.  Through active participation in the regulatory and legislative process in Washington, D.C., ACA's members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business.  For more information, visit http://www.americancable.org/

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