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NASUCA

Discover the interdependence of wireline & wireless services highlighted in the NSTAC report. Learn about the impact of FCC goals, challenges facing small carriers, and proposals for universal service concerns.

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NASUCA

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  1. NASUCA 2012 mid-year meeting bobloube@earthlink.net

  2. The Importance of the Wireline Network • NSTAC Report to the President on • Communications Resiliency • April 19, 2011

  3. Universal Service Concerns • Technology- the FCC’s long term goal is 100 mbps service • To reach that goal it is necessary to have fiber to the premise • There is need to integrate wire and wireless services and not treat those services as separate silos • The HCL regression penalizes small carriers who have built FTTP systems

  4. Wireless is dependent on the wire line infrastructure • Wireless is dependent on wire line service not only for special access for connecting cell towers but also to sell most 4g services • To purchase 300 gbits of service per month would cost: $80 for the first 10 gbits and $10 for each additional gbit $80 + 290 * $10= $2980

  5. $4.8 billion is not enough • The FCC’s national broadband plan estimated a need of approximately $23 billion • The ABC plan, using the current cost benchmark requires $15b , $10b for price cap carriers and $5b for rate of return carriers • The ABC plan, using a high benchmark requires $9b , $6b for price cap carriers and $6b for rate of return carriers • The ABC plan, using a double tier benchmark requires $3b , $2.2b for price cap carriers and $800m for rate of return carriers

  6. Results of Underfunding • Decent but less than world class service in urban and suburban areas • Rural stagnation and bankruptcy • Possible solutions: • Massive expansion of state universal service funds • RUS requires rural coops to purchase bankrupt companies with funding from Congress

  7. Expressed Reasons for adopting Bill and Keep or I can get it for you wholesale • Eliminate Arbitrage – zero rate or one rate • Eliminate the incentive to retain circuit based switch and to an IP network – In Wyoming high access rate carriers invested in IP switches while low access rate carrier did not • Provide Incentive to reduce investments in switching • Total Benefit Exceeds Total Cost

  8. Other wholesale markets are still collecting revenue from other carriers • Special Access • Long distance • Internet Transport • Video content • Wireless Roaming • These are market where dominant firms is increasing costs for smaller firms and potential entrants

  9. The Results of Bill and Keep and Related ICC Reforms • Increases local rates with a new SLC called an ARC • Eliminates funding for the IP network • Transfers resources from ILECs to Wireless and Long Distance Carriers • Possible Response: Enlarge the local calling to the entire state

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