The Wash. Supreme Court upheld a decision by state regulators that enabled a competitive telecom company to collect universal service support to help it compete in rural ILECs’ service areas. The court said the Wash. Utilities & Transportation Commission (WUTC) had not acted unreasonably when it designated the U.S. Cellular Corp. (USCC) as an eligible telecommunications carrier (ETC) in rural ILEC territories. The WUTC’s decision was appealed by the Wash. Independent Telephone Assn. (WITA), which said the regulatory body should have held a “full adjudicative hearing” because rural ILECs “had a property interest in their designation as sole telecommunications providers” in their service areas. The state court concluded the ILECs hadn’t established “that they had a constitutionally protected property interest” and thus weren’t entitled to such a hearing. It also agreed with a lower court that WITA hadn’t shown that the WUTC had acted arbitrarily, another WITA argument. The WUTC originally gave ETC status to USCC in 1997 for areas where rural ILECs didn’t operate. USCC in 1999 asked the WUTC to expand the ETC designation to include all parts of its service area, including those served by rural ILECs. After the WUTC approved the petition in Dec. 1999, WITA sought dismissal, arguing that USCC hadn’t provided the required level of service to receive universal service funding and the action wasn’t in the public interest. The case was appealed to the state supreme court after 2 lower courts affirmed the WUTC’s action. The Supreme Court said WITA members’ argument that they had a right to be sole ETCs in their service areas was “unsupportable.” It also held that USCC did provide the services required of ETCs and concluded that WUTC had “recognized the 1996’s Act’s interrelated goals of fostering competition and advancing universal service” when it granted the ETC status. The court’s opinion was issued March 20 (Doc. 72428-8).
Country of origin cases
Intelsat struck back at PanAmSat’s questioning of its business relationship with the Dept. of Defense (DoD), exhorting the General Accounting Office (GAO) to examine and verify how Intelsat’s satellite assets are uniquely suited to meet DoD’s global coverage needs. Responding to congressional queries about DoD’s awarding of contracts for transponder capacity, Intelsat Senior Vp Tony Trujillo told GAO Comptroller Gen. David Walker that the record confirms fair consideration has been given to all potential satellite communications (satcom) competitors.
With a group of senators asking the FCC to seek public comment on any proposals it formulates for media ownership rules, some sources inside and outside the Commission are beginning to think those rules, which had been expected in late spring, could be delayed. Other FCC sources are adamant that the rules will not be put off.
The Project for Excellence in Journalism (PEJ) is critiquing the critique. Just days after NBC, Telemundo, CBS and Fox released a report highly critical of a PEJ study on the quality of news programs (CD March 17 p9), PEJ said in a filing to the FCC that it stood by its report, “Does Ownership Matter in Local Television News.” It said the network-funded critique condemned its study for “being something it makes no attempt to be” and said the critique set up a series of false thresholds that the study then failed to meet. PEJ said the network critique missed the point, that its report had no theory of cause and effect that it was trying to prove with its research and no financial stake in the outcome. The point of the 5-year study, PEJ said, was to identify patterns and trends in news quality. In the context of the FCC’s media ownership proceeding, the original PEJ report found that small station groups and network-affiliated stations tended to produce higher quality newscasts than larger companies and networks’ owned-and- operated (O&O) stations. The networks said PEJ failed to take into account ratings, the quantity of news offered, market size. PEJ stressed that it wasn’t asking the FCC to come out on a particular side of the issue. “The PEJ report has become a lightning rod because it filled a void -- it explored the issue of news quality, using the best nationwide data available to do so,” it said. It said it had “no financial stake in the outcome. It is not lobbying the government. It has no vision of what FCC regulations should look like.”
Public safety agencies, transportation officials and technology developers presented divergent views to the FCC this week on who should have access to 5.9 GHz for short- range wireless links to transmit data between vehicles and intelligent transport systems. The Dept. of Transportation urged allowing some commercial applications in the band to drive technology applications on which public safety uses could “piggyback.” But the Public Safety Wireless Network (PSWN) run jointly by the Departments. of Treasury and Justice argued for restricting access to “traditional” emergency responders so as to not congest the band. Commenters urged the FCC to mandate an industry standard for interoperability in the band.
LOS ANGELES -- As economic doldrums continue to beset the entertainment industry, the Assn. of National Advertisers (ANA) has developed 15 guidelines that ANA CEO Robert Liodice hopes will improve the bottom lines of commercial productions. “Because the whole advertising arena had taken a substantial notch down over the previous year or 2,” he said, “naturally there is a tremendous push toward being much more productive and to achieving a greater return on investment on our media investments.”
FCC Chmn. Powell has delayed action on a proposal to reclassify wireline broadband Internet access because the agency doesn’t want to overload staff resources at both the Wireline Bureau and commissioners’ offices, an FCC official confirmed Thurs. when questioned about it. The agency originally planned to act on the broadband proposal next month but now isn’t scheduled to act until June or later. A “specific time frame hasn’t been decided” yet, the staff member said. Some broadband deregulation already occurred in the UNE order so it’s less imperative that the agency act quickly now, he said. In addition, the media ownership proceeding will heavily tax the resources of commissioners’ staff so it may be difficult for the agency to handle the broadband proceeding at the same time, the staff member said. The Wireline Bureau is a bit worn out from the UNE proceeding and several Sec. 271 applications still are being processed, he said. However, a lobbyist said the delay also appeared to be rooted in concern by Powell that the broadband proposal wouldn’t win a majority vote. Having just experienced such an outcome in the UNE proceeding, Powell doesn’t want to risk a similar experience, the source said. The Wireline Bureau reportedly had completed a draft of the order before Powell decided to delay action, leading some to think more than resources were at issue in the delay. Among other things, the delay continues uncertainty whether cable modem service should contribute to the Universal Service Fund (USF). When the FCC adopted an interim reform of USF contributions methodology in Dec., it decided to set the cable modem issue aside and deal with it in the wireline broadband proceeding. Next on the agenda for wireline action are performance measurements and the universal service contributions methodology, sources said.
Qualcomm asked the FCC last week for an extra year to use an auction discount voucher (ADV) that’s due to expire in June. In June 2000, the Commission granted a $125 million auction discount voucher to the company to be used in any auction within 3 years as long as it went toward CDMA development. The voucher had been awarded as part of a settlement of a suit involving Qualcomm’s claim for pioneer’s preference involving its development of CDMA technology. In Nov. 2002, the FCC granted the waiver to Qualcomm to use the voucher to help existing CDMA licensees pay off auction debt instead of simply for future bid obligations. Qualcomm told the agency last week it had made diligent efforts to use the voucher within the 3-year period. For example, it said that in 2001 it had agreed to transfer the $125 million voucher to Leap Wireless to support its bidding in the NextWave re- auction. Those licenses since have been returned to NextWave under rulings by the U.S. Appeals Court, D.C., and the U.S. Supreme Court. That resulted in Leap’s returning the entire amount of the voucher to Qualcomm. Qualcomm told the FCC that since then it had transferred $10.8 million of the voucher to Summit Wireless, which used it for a payment on a Jackson, Miss., license. Qualcomm said it had $114.4 million remaining on its voucher. It said it based last year’s request for relief on the “very limited auction opportunities” that had arisen since June 2000. “Since that decision, Qualcomm has been in contact with several potential licensees interested in acquiring some or all of the ADV,” it told the Commission. It said it was considering using the voucher in a May 28 auction (Auction 49) of lower 700 MHz licenses. “Although we are hopeful that negotiations for use of the ADV will come to fruition within the next few months, it is always possible that there may be unexpected delays,” the company said. “For example, if Auction 49 were further delayed, it is extremely likely that the ADV could not be used in that auction.” A grant of additional time would be in the public interest to satisfy an earlier U.S. Appeals Court requirement that the FCC fashion an “appropriate remedy” for Qualcomm, the company said. The original ADV stemmed from a 1999 D.C. Circuit decision that directed the FCC to designate the company under the agency’s pioneer’s preference program. Qualcomm originally sued in 1992 after it was denied a pioneer’s preference for developing CDMA for PCS. “In view of the long period during which no suitable opportunity to use the ADV was available, and in view of Qualcomm’s diligent efforts to do so, an extension of time is consistent with the equitable remedy sought by the court,” it said.
NBC and Telemundo asked the FCC to extend a temporary waiver that allowed their common ownership of 3 of the 25 TV stations in the L.A. market over the last year. GE, which owns NBC and Telemundo, said “unforeseen changes in regulatory and market conditions” supported extension of the waiver.
The FCC granted a petition for reconsideration filed by Madison Bcstg. Group, former licensee of station WLVA(FM) and former owner of 5 antenna structures in Lynchburg, Va. The Commission originally had issued a $12,000 forfeiture order to the company for failing to post its antenna structure registration numbers and failing to maintain specified painting of them. The FCC concluded that cancellation of the fine was warranted since Madison had assigned the license and no longer was a Commission licensee. The antenna structures have been dismantled and the company doesn’t own any others.