Most Commenters Ask FCC to Reverse LBP Revocations, But Prospects Appear Dim

Aspiring Lifeline broadband providers and others urged the FCC to reinstate nine companies whose LBP designations were revoked by a Wireline Bureau order that Chairman Ajit Pai defends. State regulators opposed reinstatement and urged the commission to repeal its LBP process, which they say illegally bypasses state authority to designate carriers eligible for the USF Lifeline subsidies. LBP aspirants urged the FCC to at least make providers eligible for the program's low-income support in states where the federal commission has jurisdiction. Parties filed comments posted Thursday and Friday in docket 11-42 on requests to reconsider the Feb. 3 revocation order (see 1702030070 and 1703020059).

Two industry representatives told us there's "no way" the FCC under Pai would reverse the bureau decision to revoke the LBP designations of Spot On Networks, Boomerang Wireless, KonaTel, STS Media (FreedomPop), Applied Research Designs, Kajeet, Liberty Cablevision of Puerto Rico, Northland Cable Television and Wabash Independent Networks. Pai "never liked" the LBP process the commission created in a 2016 order he dissented from, a telecom attorney said. Pai sees no basis in the law for bypassing the states, believes the FCC was going to lose a NARUC court challenge, and doesn't want the Lifeline program to grow, said a telecom official. The expert called the revocations "a win, win, win" for Pai.

The telecom official would be "really surprised" if any LBPs are approved going forward, even though Pai said in a Feb. 7 defense of the revocation order that the nine applications hadn't been rejected and were pending (see 1702070062). The FCC convinced a U.S. Court of Appeals to hold in abeyance its review of NARUC's challenge to the federal LBP process while the commission considers its course (see 1702160033).

“We’re hopeful that providers still apply to participate in the Lifeline broadband program," said Public Knowledge Senior Policy Counsel Phillip Berenbroick. "We’re a little skeptical this process is going to move forward quickly, but it should, especially given the chairman’s constant refrain that he’s focused on closing the digital divide.” The FCC didn't comment Friday.

Pai again defended the revocation order, responding to Senate Democrats who voiced concern, a group led by Sen. Richard Blumenthal, D-Conn. The order “affected only nine of the more than 900 carriers participating in the Lifeline program -- that's less than 1%” and “eight of the nine affected carriers had no Lifeline customers,” Pai told the Democrats in his reply released Thursday and dated March 7. He said there’s “a serious question as to whether the FCC has the legal authority to designate Lifeline providers or whether such designations must be made by state governments, as has long been the case.” He argued for effective use of the subsidies and cited his investigation into the Lifeline program as a commissioner. “We need to make sure that safeguards are strong and effective in order to direct subsidies to American consumers who most need the help,” said Pai.

Gigi Sohn, a top aide to then-Chairman Tom Wheeler, said the pushback against the LBP revocations is helpful. "I think the huge outcry over a relatively small Bureau decision to reverse the 9 LBP certifications will give Chairman Pai pause about doing any more damage to the Lifeline program. It has an awful lot of supporters, including in industry," emailed Sohn, now an Open Society Foundations fellow.

The Lifeline Connects Coalition was among those backing a request by almost 40 groups, including Public Knowledge, to reinstate the nine LBP providers (see 1702230011). The revocations undermined the Lifeline goal of "bringing affordable communications services to poor people," said the comments of the LCC, which consists of American Broadband & Telecommunications, Blue Jay Wireless, i-wireless and Telrite. Applied Research Designs, Northland Cable Television, LocalTel Communications, the Greenlining Institute, Media Alliance, Chicago, Philadelphia City Council, Public Knowledge, Voice for Internet Freedom Members, Writers Guild of America, East, AFL-CIO and others also asked the FCC to reconsider the bureau revocation order and/or reinstate the LBP designations. The order "delays an array of innovative and high quality Lifeline broadband offerings and has a chilling effect on other potential Lifeline broadband entrants," commented the Leadership Conference on Civil and Human Rights.

NARUC said "the FCC should reject requests to reverse the Bureau Order and expeditiously reconsider the March Order to eliminate the illegal bypass included in the LBP designation procedure, its comments said. The Oklahoma Corporation Commission commented that the order was "an appropriate first corrective step" and suggested further efforts are needed to combat waste, fraud and abuse.

The LCC said the FCC should grant other pending LBP petitions that meet the agency's requirements. If the commission doesn't believe it has the authority to designate LBPs as specified in the 2016 order, the LCC said, it should grant LBP or wireless eligible telecom carrier (ETC) authority "to Lifeline providers in those jurisdictions in which it clearly has authority -- the 12 federal jurisdiction states -- pursuant to the streamlined timelines established for LBPs." Assist Wireless and several other LBP aspirants separately asked the FCC "to delineate a path forward" for them to offer Lifeline broadband services by granting their ETC petitions for states where the federal commission has jurisdiction. Assist Wireless, Blue Jay Wireless, Easy Telephone Services, Karma Mobility and Telrite asked the FCC to act on the ETC bids by April 3, when they said the bureau was due to decide their LBP petitions. Others have LBP decisions due later.

Sohn said the Lifeline order "instructs the Bureau to certify new LBPs if they meet certain standards. So until the full Commission reverses that decision, the Bureau is bound to do so.”