Nov. 4 Vote Could Prove Disastrous for Rural Consumers  

A vote with nationwide implications is scheduled for November 4, but it’s not the one you know about. In fact, you’ve probably never heard of it. The vote holds the potential for dealing a serious setback to rural economic growth, could threaten many communications jobs in rural markets and inject instability in an industry vital to  economic growth at a time of extraordinary economic uncertainty in America. Give up?

It’s a pending vote by the Federal Communications Commission (FCC) on a proposed order that, if adopted, could dramatically alter the cost and availability of rural communications and  broadband in this and other states. And who would bear the cost? Millions of rural consumers and  businesses.  

Here’s the bottom line: The FCC is considering a proposal to change “intercarrier compensation” rules. These are the rules that determine how telecom companies pay each other to exchange voice and data communications traffic. The proposal’s apparent goal is to cut costs, but in reality it shift costs disproportionately to rural consumers and businesses. In fact, the Consumers’ Union  has concluded the proposal could result in a billion-dollar giveaway to the largest, urban-focused  phone companies.  

The proposed order would systematically cut the compensation paid to rural telecom providers for  communications traffic to the areas they serve, without reducing the underlying cost of providing  their services. The wrong decision on November 4 could lead to multiple negative consequences:

• Higher Consumer and Business Phone Bills: Rate increases could range from several dollars to as much as $10 per month in some parts of the country, forcing many low- income and senior citizens in rural areas to choose between basic necessities and essential communications services, including reliable 911 and broadband access.
• Decreasing Rural Broadband Investment: The proposal could undercut broadband investment by eliminating billions of dollars in funding, the funding used by rural providers today to expand broadband deployment. While claiming to achieve 100 percent broadband availability, the proposal would realistically make achieving such a goal virtually  impossible for the foreseeable future.
• Put Rural Development/Jobs at Risk: The proposal would slow rural economic development efforts in areas that rely on broadband connectivity to compete in the global economy, putting thousands of high-paying, high-tech jobs in rural communities in jeopardy.
• Increase Market Instability: At a time of major economic uncertainty, the FCC’s proposed order would create further instability in an industry vital to economic growth.  These negative repercussions will be felt directly by Main Street America.  Compounding the threats inherent in this proposal, the vote is scheduled for November 4, when it’s likely your attention and the attention of Congress will be elsewhere.  At the very least, the FCC should postpone its decision until it and Congress are able to  understand the proposal’s full impact on rural Americans and businesses. An issue this significant  deserves the full attention of both Congress and the FCC. In fact, the National Association of  Regulatory Utility Commissioners, which represents state regulatory officials around the country,  recent sent a letter to the FCC asking for a longer review period and more public comment on the  FCC proposal.  

If you agree, send your thoughts to the FCC at fcc.gov or to individual commissioners -- Chairman  Kevin Martin at KJMWEB@fcc.gov; Commissioner Debra Tate at dtaylortateweb@fcc.gov;  Commissioner Robert McDowell at Robert.McDowell@fcc.gov; Commissioner Michael Copps at Michael.Copps@fcc.gov; Commissioner Jonathan Adelstein at Jonathan.Adelstein@fcc.gov and to your local congressional delegation.     

by Tom Gerke, CEO, EMBARQ