Former FCC'ers Seek USF Revisions, Tech Contributions

The Universal Service Fund should be revised and the FCC should consider requiring contributions from tech companies, said a bipartisan group of current and former commissioners on a virtual panel Wednesday hosted by the Multicultural Media, Telecom and Internet Council. The group, including former Chairs William Kennard and Richard Wiley, also discussed the lack of an FCC majority, the digital divide and media ownership.

FCC Commissioner Brendan Carr's call for the agency to look at fixes for USF is a good sign for possible FCC action, former Commissioner Mignon Clyburn told the panel. She was “demonized” for seeking robust USF reform when she was at the agency just few years ago, Clyburn said. To hear Carr “even entertain the idea” is “progress,” she said.

USF “is sort of stuck in a death spiral” said Carr at Wednesday’s event. “We should start looking to large technology companies to contribute a fair share.” Most of the world’s most valuable companies are U.S. tech firms, said Kennard, now AT&T board chairman. “They made those profits riding on the networks that are regulated by the FCC.” He expressed concern that the focus on deploying broadband has detracted from improving the USF program as a whole. “The system is fundamentally in need of reform,” Kennard said.

Now that support is bipartisan, the FCC might be able to act, said Clyburn, a consultant. “Do it now and stop punting,” she said. “I’m beginning to not like that word punt, we’re using it too much -- with all due respect -- when it comes to USF reform."

The FCC should focus on deployment and encourage digital literacy to combat digital discrimination, Wiley said. Clyburn said the agency needs to focus on outreach to underserved communities, and “those on the ground” should be “culturally familiar with those communities.” Commissioner Geoffrey Starks touted an FCC August draft item on a pilot program for outreach to recipients of federal housing assistance. “The longer we wait, the further behind we leave the unconnected,” he said.

The former FCC commissioners repeatedly praised Chairwoman Jessica Rosenworcel for getting things done with a 2-2 FCC but suggested the window is shrinking for the appointment of a fifth commissioner (see 2207110065). The August recess and the approaching midterm mean few legislative days remain for such a confirmation, said Wiley, chairman emeritus of Wiley. Former FCC Commissioner Jonathan Adelstein said there may be a chance for the appointment to go through during a post-midterm “lame-duck” legislative session -- that's how he was confirmed to the agency, he said. Adelstein is now Digital Bridge head-global policy and public investment.

The FCC should be more assertive about seeking inclusion in interagency working groups, said Clyburn in response to a question about the commission’s proceeding on data breaches. The FBI, SEC and other agencies have their own procedures for such breaches and the telecom rules are outdated, Wiley said. “I just don’t see how this is going to occur without everyone at the table who needs to discuss it,” said former Commissioner Deborah Taylor Tate. The agency has been “hesitant” to ask for a place at the table on interagency issues such as privacy, Clyburn said. The timing of data breach notifications is “a very sensitive area,” and informing the public should be balanced with the needs of law enforcement, said Kennard.

Minority broadcast ownership is “vital to communities,” but broadcasting is also “a shrinking part of the content ecosystem,” said Kennard. “I think we do young minority entrepreneurs a disservice” by not discussing nonbroadcast platforms “because that’s where the growth is,” he said. Clyburn said the agency should continue to push for rules to increase ownership diversity. “I’ll never let them off the hook,” she said. Clyburn said she doesn’t expect movement on the 2018 quadrennial review with the FCC’s current composition.

Both Kennard and Wiley said the most effective way to create more broadcast ownership diversity would be to reinstate the minority tax certificate. “It’s something that MMTC and the NAB both support, so why can’t we get it done?” Wiley said.

Commissioner Nathan Simington urged the FCC to work on attracting diverse employees to the broadcasting industry. “I’m skeptical that our rules as written are going to help. If they worked, they would have worked,” he said. “Given that they haven’t, we might be led to conclude that they don’t.”