Is the FCC Going to Nationalize the Media?

Pinky_and_the_BrainI ran across an article that just has me shaking my head. It’s by Kurt Nimmo at a site called Alex Jones’ InfoWars. This article claims that the FCC is doing a study as a precursor for privatizing the private media sector, including the Internet.

I certainly understand with people feel a little paranoid about the government right now due to the gigantic data gathering that is being done by the NSA. But it’s pretty incredibly paranoid to think that somehow the US government is planning on taking over every TV station, radio station, newspaper and even the Internet. Of course, one gets the first clue that this article is a bit paranoid and biased when the very first sentence uses the word ‘sovietization’.

So what the heck is this guy talking about that would give him the idea that the FCC was ready to take over the communications world? It starts with a study that the FCC is undertaking through Social Solutions International. I have included here this Research Design Study from SSI so that you can see it for yourself. This document is not the results of the FCC study, but instead is a description of the study that is currently being undertaken, to be published sometime in 2014.

My firm CCG Consulting does market surveys and so I am pretty conversant with the kind of jargon that is used to talk about statistical sampling and market research. And this document is massively jargon-laden and it takes some reading between the lines to figure out exactly what they are doing.

So what is this study trying to find out? They are basically after two things. First, they want to understand better where people go to get their news. The study refers to this as ‘critical information needs’, but it basically boils down to where people to find out what is happening in the world – and that is news

Second, the study is looking at random local markets to do a qualitative analysis of information that is made available to the public. This is the part that has Mr. Nimmo so paranoid because it is going to look at local newspapers, radio broadcasts and TV and judge them according to accuracy, fairness, bias, etc. And somehow they are going to try to do the same thing with the Internet.

But it’s a long stretch to say that the FCC is using this study as a precursor to taking over media. That is a monstrous break in logic and out of touch with reality and with the relatively weak nature of the FCC.

So what do I think of this study? It certainly is within the purview of the FCC to periodically look at how people communicate in the country. After all, they are in charge of monitoring and regulating those very industries.

But I don’t think this particular study is going to be very effective or turn up anything of much interest. Certainly it is going to give us a peek at where people go to get information today. But one would have to think that companies like Google know far more about that today than what this study is going to uncover.

And I have very poor hopes that the qualitative analysis is going to uncover anything that will be statistically valid and have any relevance for the whole country. It would make a lot more sense to study a tiny of handful of markets in complete depth over a long period of time if somebody really wants to understand the barriers and misinformation that is in place today in local media. Those kinds of local studies are best done by academia. This study doesn’t look to me to be as thorough and vigorous as those kinds of studies can be.

And so my expectations is that this study is going to generate a few headlines next year highlighting whatever claims the study makes, and then it will go on the shelf. It’s not likely to have much impact on FCC policy and it certainly is not going to be the catalyst to the FCC somehow taking over the US media (not sure how they would do that even if they wanted to).

But unfortunately in the Internet age people like Mr. Nimmo can stir up paranoia and animosity towards the government over what, in this case, looks more like an expensive boondoggle. There are certainly things that I don’t like about the FCC, being an industry person, but I am not too worried that they are out to conquer the world a la Pinkie and the Brain.

Faster Internet for Schools and Libraries

On July 23 the FCC released a Notice of Proposed Rulemaking in WC Docket No 13-184 that asks questions about modernizing the E-rate program for schools and libraries. The E-rate program has been around for a few decades and has been used to bring broadband to schools and libraries.

But last month President Obama announced a ConnectED initiative that has the stated goal of bringing a minimum of 100 Mbps and a goal of 1 Gbps to 99% of students within five years. This NPRM is in response to that initiative.

A 2010 FCC survey showed that only 10% of schools had speeds of 100 Mbps or greater. 48% of schools had speeds less 10 Mbps. 39% of schools reported cost as the barrier to better speeds while 27% cited the cost of installation as a barrier. And the situation is worse in our libraries. In a 2011 survey by the American Library Association only 9% of libraries have speeds of 100 Mbps or faster while 25% still have speeds of 1.5 Mbps or less.

There is clearly a need for revised E-rate funding. In the most recent year there were requests for funding from schools of over $4.9 B from a fund that is at an annual cap of $2.25 B. The E-rate program is funded today as part of the Universal Service Fund that gets fund by a surcharge put on a wide variety of telecommunications end-user bills.

The FCC has laid forth new goals for the E-rate program and also suggested a number of specific changes. The new goals include 1) That schools and libraries have affordable access to broadband in order to meet the goals of ConnectED; 2) that the effectiveness of the E-rate funding is maximized, and 3) that the administration of the program is streamlined.

The FCC seeks comments on the specific speed requirements needed for schools and libraries. They offer the target established by the State Education Technology Directors Association (SETDA) which suggests that K-12 schools should have at least 100 Mbps per 1,000 students by 2015 and 1 Gbps for every 1,000 students by 2018. For libraries they offer the State Library of Kansas recommendation that all libraries should have 1 Gbps connectivity by 2020.

One of the issues that the NPRM looks at is how to get the bandwidth around the school once it’s delivered to the side of a school. This is a significant issue because today’s wiring technologies and wireless technologies have a steep drop-off in data speeds over even short distances. So the NPRM looks for comments on how to best get the bandwidth to classrooms.  The State E-Rate Coordinators Association (SECA) has suggested that this issue is of high enough importance that it ought to be at the top of the priority list for E-rate funding.

The NPRM asks questions about increasing the efficiencies of buying broadband. This includes consortium purchasing and other bulk buying opportunities. The larger school districts are able to negotiate better rates today than small school districts due to the fact that they serve a significant number of schools. There must be ways for neighboring districts to band together for efficiency (although local politics is often a barrier to this process).

The NPRM also asks what the funding should be used for. It suggests that funding be transitioned to support only broadband. The funding is currently used for a number of other purposes which were allowable under the old rules.  For example, in the most recent funding year there were requests for $260 M to subsidize telephone lines.

Finally, the NPRM looks at who is eligible for the E-rate program. Today the program pays for some portion of eligible costs based upon the percentage of student enrollment that is eligible for a free or reduced price lunch in a given school. The school gets a discount based upon that factor and must then match between 10% and 80% of the cost. The NPRM looks at alternate eligibility requirements including (1) revising the discount matrix to increase certain applicants’ matching requirements; (2) providing support on a district-wide basis; (3) revising the approach to supporting rural schools and libraries; (4) incorporating a per-student or per-building cap on funding into the discount matrix; (5) providing more equitable access to priority two funding; and (6) allocating funds to all eligible schools and libraries up front.

Comments in the NPRM are due to the FCC by September 16, 2013. CCG Consulting will probably be making some comments in the Docket, so if you have anything you want to say let me know and it can be included in our filing.

Regulatory Alert: FCC Reminds ACS Providers (Advanced Communications Services) of Filing for CVAA Compliance

Seal of the United States Federal Communicatio...

The FCC recently issued a public notice reminding Advanced Communications Providers (ACS) and equipment manufacturers that they need to provide evidence that they are complying with the Twenty First Century Communications and Video Accessibility Act (CVAA). The FCC is now implementing Section 255 of the Telecommunications Act of 1996 that requires telecom products and equipment be accessible by people with disabilities.

The FCC defines an ACS provider in Section 3(1) of the Act to mean a carrier that provides one of the following: (A) interconnected VoIP service; (B) non-interconnected VoIP service; (C) electronic messaging service; and (D) interoperable video conferencing service. The FCC also defines advanced communications services providers to include all entities that offer advanced communications services in or affecting interstate commerce, including resellers and aggregators. Such providers include entities that provide advanced communications services over their own networks, as well as providers of applications or services accessed (i.e., downloaded and run) by users over other service providers’ networks.

The CVAA law was enacted in 2010 and is aimed to ensure that people with disabilities have access to advanced communications services. This requirement by the FCC is somewhat unusual in that it applies to telecom providers who are otherwise largely unregulated.

And there are a lot of nuances to be in compliance:

  • There must be a filing done for each corporate entity that provides ACS services and you can’t just designate somebody at the parent company to cover all of your subsidiaries.
  • You must provide an affidavit of compliance by a company officer.
  • It must be filed electronically.

The original deadline for these filings was April 1, but we believe a lot of entities who should have filed did not. If you provide any form of VoIP you need to comply with these rules or face eventual fines.

The filing requires the following:

  • A description of the effort the company will undertake to discuss your services with customers with disabilities.
  • A description of the features and other ways that your products will be made accessible to customers with disabilities.
  • A description of how people with disabilities would most likely be able to use your products.

So, if you provide VoIP – even on a resale basis – you need to make this filing.

If you want to know more about the specific filing requirements, or if you want assistance in making this filing contact Terri Firestein at (301) 788-6889.