Major Carriers Warn USF Already Overburdened in Comments on 5G Fund

Verizon, T-Mobile and AT&T told the FCC it should move with care on a 5G fund, especially given the perilous state of the USF. Groups representing small carriers said the fund is critical to connecting millions of Americans on the wrong side of the digital divide. Comments were posted Tuesday in docket 20-32 in response to a Further NPRM approved by commissioners 4-0 in September (see 2309210035).

The commission contends in the FNPRM “that ‘numerous ‘broadband deserts’ continue to exist,’ pointing to a staff estimate that ‘over 14 million broadband serviceable locations … lack mobile 5G coverage at speed thresholds of at least 7/1 Mbps in an in-vehicle Environment,’” Verizon said: “Although 5G coverage is not yet ubiquitous, this statement paints an overly negative picture of the state of mobile broadband deployment in the United States today. In reality, most of the areas where Americans live, work, and travel already have access to high-speed mobile broadband and are well on their way to obtaining 5G coverage.”

Verizon urged the FCC not to expand the proposed fund beyond levels proposed in 2020. The USF contribution system is “already overburdened” and “there is no evidence that $9 billion will be insufficient to meaningfully extend 5G service to the remaining areas where Americans live, work, and travel,” the carrier said.

T-Mobile asked the FCC to be mindful of spending in the broadband, equity, access and deployment program before rolling forward with a 5G Fund and also address the award of licenses it purchased in the 2.5 GHz band. Given the commission’s “'obligation to be a fiscally responsible steward of our limited universal service funds and our commitment to prevent overbuilding,’ T-Mobile encourages the Commission to defer the 5G Fund Phase I Auction until these issues are resolved,” the carrier said. T-Mobile, Verizon and NCTA previously recommended “pausing new USF support for high-cost deployments, including the 5G Fund, until the Commission could assess the impact of new federal funding for broadband deployments,” T-Mobile noted.

“The perilous state of the current universal service fund contribution factor must be considered in the Commission’s reassessment of the budget for the 5G Fund,” agreed AT&T: “Simply put, the existing USF funding mechanism, rooted in 20th century technologies and consumer demand, cannot withstand a significant increase in its budget, and this becomes more apparent with each passing year.”

“The Commission should extend 5G Fund eligibility to any area where unsubsidized 5G is not already deployed, even if that area is served by 4G,” the Competitive Carriers Association said. The fund “should be truly focused on 5G: areas without unsubsidized 5G service should be eligible for 5G Fund support,” CCA said. The group recognized that the USF contribution factor is “extraordinarily high” but noted that “a significant percentage of contributions are derived disproportionately from wireless services” and “are used primarily to fund the deployment of wireline.”

The Rural Wireless Association stressed the importance of direction from the FCC. “Clarity as to a future mobility funding mechanism, the timeline for determining 5G Fund eligible areas, and the sustainability of legacy high-cost support in rural areas is paramount to assisting small and rural providers in deploying 5G and future generation networks,” RWA said: “Without such clarity, rural carriers and other 5G Fund participants will be unable to effectively deploy the mobile networks of the future, leaving rural America behind.”

The FCC could “amplify” the impact of the 5G Fund “by taking into account where fiber and fixed wireless access deployments will be funded” through BEAD, said UScellular: “This will stretch dollars further and reduce uneconomic overbuilding.”

The program’s design choices should be “consistent with the information available” through the broadband data collection “and draw on the outdoor stationary maps that provide the most stable and consistent coverage data,” CTIA said. The group urged the FCC to work with Congress to "ensure an appropriate budget" for the fund through a “secure a long-term, stable USF funding mechanism.” CTIA also questioned the need for cybersecurity rules. “The Commission can promote robust cybersecurity practices by requiring that funding recipients’ cybersecurity risk management plans reflect the National Institute of Standards and Technology Cybersecurity Framework” and “there is no need … to layer on additional requirements, which may have the unintended consequence of harming security outcomes,” CTIA said.