May 16, 2018 - 1:33 pm
By Ajit Pai | FCC Chairman

In the spirit of the summer blockbuster season, the Commission’s June 7 meeting is going to be our own version of “Avengers: Infinity War.”  We’re taking familiar headliners—freeing up spectrum, removing barriers to infrastructure buildout, expanding satellite services, modernizing outdated rules, eliminating waste, improving accessibility, protecting consumers—and rolling them into one, super-sized meeting. 

Fittingly, our featured order is a sequel of its own.  For the past few years, one of the agency’s highest priorities has been repurposing high-band spectrum for next-generation wireless services like 5G.  In 2016, the FCC unanimously adopted the Spectrum Frontiers Order, which established rules for wireless broadband operations in frequencies at or above 24 GHz.  Last year, we approved the Second Report and Order, which modified the 2016 rules and made available an additional 1,700 megahertz of wireless spectrum for flexible use in the 24 GHz and 47 GHz bands.  Today, I’m circulating a Third Report and Order and Further Notice that takes the next steps necessary to promote U.S. leadership in 5G and to deliver advanced wireless services to American consumers.

My plan contains multiple proposals for multiple bands, so I’ll tick through them quickly.  First, it would establish performance requirements for IoT networks, revise our mobile spectrum holdings rules, and resolve pending sharing and operability issues in the 24 GHz band.  Second, for the lower 37 GHz band, we would resolve pending petitions for reconsideration and establish a band plan.  Third, the Further Notice asks further questions about the sharing framework for federal and non-federal use in the 37 GHz band.  Fourth, it also proposes making spectrum in both the 26 GHz and 42 GHz bands available for flexible wireless use.  There’s a lot to digest here, but the big takeaway is that the FCC is taking action to unleash spectrum for the next-generation wireless services that will help grow our economy, boost our nation’s competitiveness, and improve our quality of life. 

As I said at the outset, our June meeting features the Commission’s greatest hits.  Removing regulatory barriers to encourage the deployment of next-generation networks and close the digital divide certainly fits that bill.  That’s something that consumers strongly support; as I’ve traveled from the Mountain West to the Gulf Coast, I’ve heard many of them say that they want to benefit from modern, more resilient technologies like optical fiber instead of limping along with slower services like DSL provided over old, often-degraded copper.  To respond to that desire, I’ve shared an order with my colleagues that would make it easier for companies to discontinue outdated, legacy services and transition to the networks of the future.  These reforms would enable the private sector to stop spending scarce dollars propping up fading technologies of the past and promote investment in technologies of the future.  They will also make it easier to restore service in the aftermath of natural disasters and other catastrophic and unforeseen events. 

Another key to closing the digital divide is lowering the cost of broadband services for consumers.  Unfortunately, the FCC’s current rules impose disparate financial burdens on certain rural broadband providers, and their customers literally wind up paying the price.  Bear with me on this:  The FCC has consistently declined to impose Universal Service Fund (USF) contributions obligations on broadband Internet access service.  In English, that essentially means we don’t tax broadband.  But rural carriers that offer certain broadband transmission services are uniquely required to contribute to the USF on the revenues from those offerings.  Again in English, this essentially means rural companies (hence their customers) have to pay broadband taxes that others don’t have to pay.  On June 7, we’ll vote on an order that would relieve small, rural carriers from having to pay these broadband taxes, thereby reducing the cost of broadband services for their customers.

Since 2017, the FCC has placed greater emphasis on enabling new satellite technologies to help close the digital divide.  In particular, we’ve looked to the skies and have approved the first non-geostationary satellite orbit satellites that would enable high-speed Internet access comparable to Earth-bound offerings.  Our June agenda includes two items that would allow satellite companies to offer new services in the United States.  The first would expand the U.S. market access of O3b Limited, allowing it to use 26 additional satellites to supply broadband to American customers.  The second authorizes Audacy Corporation, a California-based startup, to deploy a middle-Earth-orbit satellite constellation that enables satellite systems to “talk” to each other.  

Our Modernization of Media Regulation Initiative has been a consistent source of content for Commission meetings, and our June meeting will be no different.  This time, we tackle the FCC’s leased access rules.  These rules require cable operators to set aside channel capacity for commercial use by unaffiliated video programmers.  The glaring problem with our leased access rules is that they’ve been in legal limbo for a decade.  The Commission updated them in 2008, but the Office of Management and Budget never approved them and a federal court halted them.  All this means that the 2008 update never went into effect and businesses are still operating under rules adopted nearly 25 years ago.  I’ve proposed to vacate the 2008 Order and start over with a clean slate regarding our leased access rules—including an examination of how to modernize them to fit the modern marketplace.  

We’ll also be reviewing our rules to root out waste, fraud, and abuse.  Historically, our intercarrier compensation system has in many cases enabled arbitrage as a business model.  In 2011, the FCC adopted reforms to the ICC system that curbed some abuses.  But there are still too many loopholes that allow bad actors to game the system.  This June, the Commission will consider two items that eye further reform of the intercarrier compensation system.   The first is an Notice of Proposed Rulemaking looking at how to eliminate incentives to artificially inflate call volumes and to inefficiently route calls.  The second focuses on getting rid of incentives for bad actors to abuse the toll-free system (known as 8YY), such as by flooding 8YY numbers with robocalls for the purpose of racking up originating access charges. 

Speaking of toll-free numbers, we’ll also consider in June how to make sure that the texting capabilities of toll-free numbers aren’t hijacked by unauthorized parties.  Toll-free numbers are a popular tool used by businesses and government to be more open and accessible to the public.  And increasingly, these toll-free numbers are used by businesses for text communications.  This can be a valuable and innovative use of toll-free numbers.  But to make sure third parties that don’t abuse the system by “text-enabling” a toll-free number they don’t own, we want to set rules of the road for activating this function.

Another valuable and innovative service that we’ll be addressing at our June meeting is Internet Protocol Captioned Telephone Service (IP CTS).  This is a telecommunications service (technically, a telecommunications relay service, or TRS) that allows individuals with hearing loss to both read captions and use their residual hearing to understand a telephone conversation.  Use of IP CTS is paid for entirely through the FCC’s TRS Fund, and it’s grown exponentially in recent years.  Today, this service represents almost 80% of the total minutes compensated out of the Commission TRS Fund—at a cost of nearly one billion dollars.  At the same time, the contribution base for the TRS Fund is shrinking.  We simply have to take action to preserve the viability of IP CTS for those people with hearing loss who need it.  That’s why we’ll be voting on moving IP CTS compensation rates closer to actual provider costs, on measures to limit unnecessary IP CTS use, and on exploring ways to expand the TRS Fund contribution base.  The order would also allow service providers to use fully-automated speech recognition to generate captions and bring the benefits of this innovation to IP CTS users.

We not only want to expand access to technologies and services that help consumers, we want to shield them from illegal and harmful practices.  Two longstanding and continuing problems for consumers are slamming and cramming.  Slamming is the unauthorized change of a consumer’s preferred telecommunications provider.  Cramming is the placement of unauthorized charges on a consumer’s telephone bill.  The FCC has taken enforcement actions against slamming and cramming for several years, but the rules against these types of fraud need to be strengthened.  That’s why I’m proposing new rules that include a clear ban on misrepresentations made during sales calls and a clean prohibition against placing unauthorized charges on consumers’ phone bills.  My proposal would also put additional teeth into our anti-slamming rules by clarifying that carriers who abuse our third-party verification process will be suspended from using that system for two years.

Rounding out our June meeting will be an enforcement item, which I can’t currently disclose.  Think of it as the surprise teaser at the conclusion of every Marvel movie.

Like “Infinity War,” our June meeting will have a running time that many may find excessive.  But it also stands to unleash billions in economic activity and include multiple crowd-pleasers that I hope will leave the audience wanting more.