FCC Commissioner Ajit Pai railed against raising the local...

FCC Commissioner Ajit Pai railed against raising the local rate floor, in a speech to the Western Telecommunications Alliance Wednesday. The FCC should not raise many rural Americans’ phone bills by 46 percent, either through a one-time increase or by phasing in such an increase, he said. Pai called for freezing the local rate floor “indefinitely” while the agency examines the underlying policy. The rate floor, meant to reduce so-called “excessive subsidies” for basic phone service, was a “mistake” that the agency has a responsibility to correct, Pai said. “Rate shock could send customers off the network entirely,” he said, according to prepared remarks (http://fcc.us/1n4UGpf). “That means further uncertainty about the economics of investing in rural America.” The rate floor is “bizarre” in that it wrongly assumes “that what’s affordable in our country’s largest cities must be affordable in our small towns,” Pai said. Pai also said the quantile regression analysis benchmarks should be stricken. Chairman Tom Wheeler said in a blog post last week that a circulating order would do just that (see related story in this issue).