House Committee Advances Bill for Vetting Recipients of High-Cost Broadband Subsidies

On April 8, the House Commerce Committee voted 50-1 to pass the Rural Broadband Act of 2025 – HR 2399. The bill would require the FCC to establish a vetting process for future applicants for future high-cost universal service program funding for deployment and supporting broadband Internet access services. The purpose of the vetting process is to ensure that subsidies go to entities that are capable of fulfilling their universal service obligations. 

The Rural Broadband Act has been introduced in prior Congresses. My blog post from February 16, 2023, describes a bit more about the bill as it was introduced in the 118th Congress by Senators Shelley Moore Capito and Amy Klobuchar. 

 

This bi-partisan legislation appears to be a reasonable measure to help prevent money collected from U.S. consumers via surcharges – effectively, "USF Taxes" – being misspent and wasted. The House of Representatives should give HR 2399 an up-or-down vote.

 

Meanwhile, the need for an overhaul of the Universal Service Fund is still pressing. As Free State Foundation President Randolph May and I explained in our August 2023 comments to the Universal Service Reform Working Group: "Reform of the USF subsidy system is urgently needed because the system is outdated and no longer fiscally sustainable." The existing universal service regime was established in a voice-centric 1990s context, with a broader contribution base and much smaller sized fund than today with a dwindled base and a bloated annual distribution amount of $7 billion to $8 billion. As a result, the USF Tax has continued to climb, and the most recent proposed quarterly contribution factor increase will raise the USF Tax to 36.6%.

 

Notably, the constitutionality of the contribution mechanism of the USF was the subject of oral arguments before the Supreme Court on March 26 of this year. Regardless of the Court's verdict on the constitutionality of the USF's contribution system, economic realities require reforms. One possible reform is switching from the USF Tax to appropriations by Congress. Another reform option is expanding the contribution base to major Internet websites that benefit the most from universal broadband connectivity. Those ideas were among the many topics discussed at the Free State Foundation's Seventeenth Annual Policy Conference – #FSFConf17 – held on March 25, 2025, in Washington D.C. Video of the conference panels, keynote addresses, and keynote conversations are available online.

TMT with Mike O'Rielly – Ep 19: Keynote Convo at FSF's 17th Annual Conference

Episode 19 of "TMT with Mike O'Rielly," a videocast featuring former FCC Commissioner and Adjunct Senior Fellow at the Free State Foundation Michael O'Rielly, was released on April 2. In this episode, titled "The Free State Foundation's Seventeenth Annual Policy Conference," Mr. O'Rielly has a conversation at #FSFConf17 with guests FTC Commissioner Melissa Holyoak, FCC Commissioner Nathan Simington, and former FCC Chairman Ajit Pai. Their conversation ranges a number of communications, competition, and administrative agency-related topics. Streaming video of the episode is now available: 

Video of #FSFConf17 Available Now!

The Free State Foundation's 17th Annual Policy Conference – #FSFConf17 – was held on March 25 in Washington, DC. The entire event was livestreamed and it is available online for viewing. To hear keynote addresses by Professor Jonathan Turley, Senator Ted Cruz, Congressman Richard Hudson, as well as insights from communications policy experts on topics such as spectrum repurposing and auctions, broadband subsidy programs like BEAD, state-level broadband regulation, and universal service, be sure to check out the video.

FCC Copper Retirement Orders Will Boost Next-Gen Network Deployment

 On March 20, the FCC announced a slate of orders that reduced regulatory burdens for voice service providers seeking to retire old legacy copper networks. Chairman Brendan Carr and agency staff deserve credit for taking proactive steps to eliminate and reduce regulations that delay and run up the costs of making technology transitions to more advanced networks. 

The FCC released four orders. The first order clarified the Commission's Adequate Replacement Test criteria for streamlining discontinuances of telecommunications services under Section 214(a), initially adopted in the 2016Technology Transitions Order. The agency found that the rules had been misunderstood in an overly expansive way as requiring pre-discontinuance network performance testing of replacement networks only according to a specific set of requirements. As a result, "there has been a significant delay in carriers availing themselves of the technology transitions streamlined discontinuance process for their own replacement services, to the detriment of consumers who have been slower to receive next-generation services than the Commission expected." Accordingly, the order states: "We thus clarify that a carrier seeking Commission authorization to discontinue a legacy voice service pursuant to the Adequate Replacement Test's totality of the circumstances with respect to its own replacement service need only show, based on the results of the carrier's routine internal testing or other types of network testing, that 'the network still provides substantially similar performance and availability' as the service being discontinued."

 

The agency's second order "waives the filing requirements in the Commission’s network change disclosure rules adopted under section 251(c)(5) of the Communications Act of 1934." In the order, the agency found that "good cause exists to waive any requirement to notify the Commission of network changes" by incumbent local exchange carriers (LECs) such as changes resulting from the retirement of copper networks and transitions to next-generation networks. "As a result, an incumbent [local exchange carrier] LEC now is only required to post public notice of its planned network changes through industry fora, industry publications, or on the carrier’s publicly accessible Internet site, and to provide direct notice to interconnected telephone exchange service providers for copper retirements and short-term network changes." And it found that the waiver’s benefits outweighed any costs given extraordinary developments in the market over the last 30 years – including the dramatic rise of VoIP services to over 75% of fixed retail voice subscriptions at the end of 2023, while switched access lines continue to dramatically decline. 

 

Its third order waives Section 214(a) notice and application requirements for providers seeking to grandfather legacy services – that is, to stop offering those services to new customers. 

 

Additionally, the agency's fourth order waives the "stand alone service" requirement in the Commission’s rules for service discontinuance established in the agency’s 2018 Wireline Infrastructure Order. By granting the waiver, the order provides relief that was requested in a February 2025 petition by USTelecom. According to the order, USTelecom has asserted that adults in landline-only households had fallen to 1.3% of all households, and that bundled voice and broadband options, are available at prices that compare favorably to legacy voice pricing. 

 

In each of the copper retirement orders, the Commission found that relief from the regulatory requirements would free up the investment of resources in the development and deployment of more advanced communications services. 

 

The release of the four copper retirement orders coincides with Chairman Carr's announcement of the opening of the Commission's DELETE, DELETE, DELETE initiative. Under new leadership, the Commission's early actions are hopeful indicators that the agency will modernize its rules and reduce old and wasteful requirements. 

P.S. The reduction and modernization of the FCC's rules will be on the agenda for the Free State Foundation's Seventeenth Annual Policy Conference - #FSFConf17 - on Tuesday, March 25, in Washington D.C. Register online. 

Pennsylvania Bill Would Turn Broadband Internet Networks into Public Utilities

On March 17, Pennsylvania House Bill 924 was referred to a legislative committee in that state's lower chamber. If it were to become law, the bill would change the definition of "public utility" under Pennsylvania law to include "[p]roviding persons with the ability to connect to the Internet through equipment that is located in this Commonwealth." In short, PA House Bill 924 is a state net neutrality bill, that would impose no blocking, no throttling, no paid prioritization, and other restrictions on provider network management, and delegate authority to the state's public utility commission to regulate broadband Internet access services.  

PA House Bill 924 was filed in the wake of the Sixth Circuit's March 11 order denying a rehearing en banc on that court’s January 2 three-judge panel decision to vacate the FCC's 2024 Title II Order. The state bill also follows closely on the heels of the Supreme Court's February 24 order deny a rehearing on its prior order to deny a writ of certiorari in New York State Telecommunications Association v. James. The denial of a rehearing in James leaves in place a Second Circuit decision from April 2024 that upheld New York State’s Affordable Broadband Act that imposed rate regulation on interstate Internet broadband access services offered by broadband providers in that state.

 

It seems unlikely, if not implausible, that Congress intended to open up jurisdictionally interstate information services (previously known as "enhanced services") like broadband access to state regulation when it established non-regulated or lightly-lightly regulated Title I classification for "information services" in the Telecommunications Act of 1996. But according to three circuit courts of appeal, that apparently is what Congress did. The Second, Ninth, and D.C. Circuits – have concluded that the FCC's decision in the 2017 Restoring Internet Freedom order to classify broadband access services as Title I services had the effect of removing the agency's jurisdiction over interstate broadband services, thus preventing the Commission from preempting state public utility regulation of those same services. 

 

For some further context, the FCC's proceeding that led up to the FCC's 2024 Title II Order cited zero instances of blocking, throttling, or harmful paid prioritization arrangements. Moreover, all or nearly all broadband ISPs in America have terms of service pledges to not engage in blocking, throttling, or harmful paid prioritization. So long as broadband access services are Title I "information services" (and not Title II "telecommunications services") those service term pledges are enforceable by the Federal Trade Commission under its authority to address unfair and deceptive trade practices. 

 

Expect the issue of state-level public utility regulation of broadband Internet access services, including price controls, to be a subject of discussion at the Free State Foundation's Seventeenth Annual Policy Conference – #FSFConf17 – on March 25, in Washington, D.C. Register today for the conference. 

Former FCC Chairman Ajit Pai a Keynoter at FSF's 17th Annual Conference March 25!

Registration Now Open!

 

 Keynote Speaker Announced!

 

 

Former Chairman, Federal Communications Commission, 

and Partner, Searchlight Capital

 

Previously Announced Keynoters

 

Senator Ted Cruz

 

Jonathan Turley

 

Nathan Simington

 

WHAT: FSF's Seventeenth Annual Policy Conference

 

WHERE: National Press Club, Washington, DC

 

WHEN: Tuesday, March 25, 2025 -- 8:30 a.m. - 2:30 p.m.

 

The Free State Foundation will hold its Seventeenth Annual Policy Conference on March 25, 2025, at the National Press Club in Washington, DC. This annual conference is acknowledged to be one of the nation's premier law and policy events.

 

As always, a truly outstanding lineup of senior officials and prominent experts from the FCC and Congress, and from other government agencies, industry, academia, and think tanks will discuss and debate the most important communications and Internet policy issues of the day, as well as other topical law and policy issues involving free market competition, free speech, and the rule of law.

 

With a new Trump administration, a new Congress, and new leadership at the FCC, FTC, and other agencies, this promises to be one of the most impactful of FSF's annual conferences.

 

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH.

BUT YOU MUST REGISTER TO ATTEND.

 

FOR ADDITIONAL INFORMATION, CLICK HERE.

 

REGISTER HERE!

 

#FSFConf17

FCC's Nathan Simington a Keynoter at FSF's 17th Annual Policy Conference on March 25!

 

Registration Now Open!

 

New Keynote Speaker Announced!

 

Nathan Simington

 

Commissioner, Federal Communications Commission

 

Previously Announced Keynoters

 

Senator Ted Cruz

 

Jonathan Turley

 

WHAT: FSF's Seventeenth Annual Policy Conference

 

WHERE: National Press Club, Washington, DC

 

WHEN: Tuesday, March 25, 2025

 

The Free State Foundation will hold its Seventeenth Annual Policy Conference on March 25, 2025, at the National Press Club in Washington, DC. This annual conference is acknowledged to be one of the nation's premier law and policy events.

 

As always, a truly outstanding lineup of senior officials and prominent experts from the FCC and Congress, and from other government agencies, industry, academia, and think tanks will discuss and debate the most important communications and Internet policy issues of the day, as well as other topical law and policy issues involving free market competition, free speech, and the rule of law.

 

With a new Trump administration, a new Congress, and new leadership at the FCC, FTC, and other agencies, this promises to be one of the most impactful of FSF's annual conferences.

 

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH.

BUT YOU MUST REGISTER TO ATTEND.

REGISTER HERE!

 

#FSFConf17

Sen. Ted Cruz Announced as a Keynote Speaker! FSF's 17th Annual Policy Conference on March 25!

 Registration Now Open!

New Keynote Speaker Announced!

 

Senator Ted Cruz

 

Chairman, Senate Committee on Commerce, Science and Transportation

 

Previously Announced Keynoter

Jonathan Turley

 

WHAT: FSF's Seventeenth Annual Policy Conference

 

WHERE: National Press Club, Washington, DC

 

WHEN: Tuesday, March 25, 2025

 

The Free State Foundation will hold its Seventeenth Annual Policy Conference on March 25, 2025, at the National Press Club in Washington, DC. This annual conference is acknowledged to be one of the nation's premier law and policy events.

 

As always, a truly outstanding lineup of senior officials and prominent experts from the FCC and Congress, and from other government agencies, industry, academia, and think tanks will discuss and debate the most important communications and Internet policy issues of the day, as well as other topical law and policy issues involving free market competition, free speech, and the rule of law.

 

With a new Trump administration, a new Congress, and new leadership at the FCC, FTC, and other agencies, this promises to be one of the most impactful of FSF's annual conferences.

 

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH.

 

BUT YOU MUST REGISTER TO ATTEND.

REGISTER HERE!

 

#FSFConf17

Jonathan Turley Announced as a Keynote Speaker! FSF's 17th Annual Policy Conference on March 25!

Registration Now Open! First Keynote Speaker Announced! Jonathan Turley

Shapiro Chair for Public Interest Law, George Washington University Law School, and Fox News Media Contributor

 

Professor Turley is the author of the important timely new book, "The Indispensable Right: Free Speech in an Age of Rage."

 

WHAT: FSF's Seventeenth Annual Policy Conference

 

WHERE: National Press Club, Washington, DC

 

WHEN: Tuesday, March 25, 2025

 

The Free State Foundation will hold its Seventeenth Annual Policy Conference on March 25, 2025, at the National Press Club in Washington, DC. This annual conference is acknowledged to be one of the nation's premier law and policy events.

 

As always, a truly outstanding lineup of senior officials and prominent experts from the FCC and Congress, and from other government agencies, industry, academia, and think tanks will discuss and debate the most important communications and Internet policy issues of the day, as well as other topical law and policy issues involving free market competition, free speech, and the rule of law.

 

With a new Trump administration, a new Congress, and new leadership at the FCC, FTC, and other agencies, this promises to be one of the most impactful of FSF's annual conferences.

 

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH.

 

BUT YOU MUST REGISTER TO ATTEND.

REGISTER HERE!

 

#FSFConf17