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Federal Register / Vol. 86, No. 4 / Thursday, January 7, 2021 / Rules and Regulations geographic areas are not left without a Lifeline provider.
83. We further reject arguments that the Commission cannot apply the legal authority articulated in the USF/ICC
Transformation Order because of the differences between the high-cost program and the Lifeline program.
However, as articulated in this section, we do not believe that the program differences are material with respect to the Commissions authority under section 254e to provide funding for broadband service in the Lifeline program, as funding will ultimately flow to supported facilities. Every ETC, whether they participate in the highcost program, Lifeline program, or both programs, necessarily incurs network costs associated with the provision of the supported voice service and advanced services, such as broadband internet access service. In the case of facilities-based Lifeline providers, these costs arise in deploying and maintaining their own broadband-capable networks used to offer the voice telephony supported service. Resellers participating in the Lifeline program likewise incur costs associated with the network used to offer the supported voice service by directly compensating the underlying facilities-based providers for the wholesale voice services. Some commenters also raised concerns that our actions to reclassify broadband internet access service as an information service would bar resellers from the Lifeline program. In the 2017 Lifeline NPRM the Commission sought comment on the continued role of resellers in the Lifeline program more generally, as well as on other possible rule changes that might be warranted should resellers remain in the Lifeline program.
Although we do not adopt changes in that regard in this Order, those issues remain pending. Both programs ultimately offset those network costs.
The main difference is that the high-cost program provides supplemental support for areas that are especially expensive to serve, while the Lifeline program compensates providers for some of their costs so they can offer discounted service to low-income Americans, thus incentivizing ETCs to provision, maintain, and upgrade facilities and services where low-income consumers live. Contrary to some commenters suggestion, this statutory authority is entirely consistent with the Lifeline programs goals of promoting affordability and availability of voice and broadband services. Indeed, the Commission first established the Lifeline program goal of ensuring the availability of broadband service in the
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2012 Lifeline Orderwell before the Commission decided to impose Title II
regulation on broadband internet access service. The Commissions authority to disburse Lifeline funds for broadband service is in part due to the fact that such funding ultimately flows to support the provision, maintenance, and upgrading of the voice-capable networks, but the Commission can and does still direct Lifeline funds in a way to best promote affordable voice and broadband services for low-income consumers.
84. We also reject arguments by some commenters that we cannot justify supporting broadband internet access service through the Lifeline program if the supported voice service is scheduled to eventually receive no Lifeline reimbursement in certain parts of the country. In the 2016 Lifeline Order, the Commission adopted a phasing out of support for voice-only service in the Lifeline program in most areas after December 1, 2021. In doing so, the Commission concluded that Lifeline should transition to focus more on broadband internet access service given the increasingly important role that broadband service plays in the marketplace. . . . The Commission also created a carve-out of the support phasedown, allowing continued support to voice services at a rate of $5.25 per month after December 1, 2021 to eligible subscribers served by a provider that is the only Lifeline provider in a Census block. First, support for voice-only services is not ending entirely, as the Lifeline program will continue to offer support to eligible subscribers in a Census block with only one ETC.
Nothing in the text of section 254
requires an ETC to receive universal service funds everywhere it offers the section 254c1 supported service.
Section 254c1 refers to the services included in the definition of universal service as being supported by Federal universal service support mechanisms, but does not specify the details of those mechanism or under what range of circumstances universal service funds must actually flow. Likewise, although section 254e requires ETCs to use support only for the provision, maintenance, and upgrading of facilities and services for which the support is intended, it does not specify how the Commission must direct those funds to be allocated as between support for the provision . . . of services vs. the provision, maintenance, and upgrading of facilities used to offer the section 254c1 supported service. Second, voice services will continue to be a component of many Lifeline offerings,
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as nearly 90% of Lifeline subscribers currently choose to apply their discount to a bundled offering that includes voice service along with broadband internet access service that meets the programs minimum service standards. As such, even as the voice phasedown continues, the Commission will continue to support the provision of voice services and voice-capable networks by ETCs.
We therefore disagree with commenters asserting that it is unreasonable to claim that Lifeline support would benefit voice facilities while continuing to phase out support for voice-only service. As to comments urging the Commission to pause the voice phasedown at this time, we decline to decide here and the issue remains open from the 2017 Lifeline NPRM. This Order is limited to addressing the three discrete issues remanded to the Commission by the D.C. Circuit.
Nevertheless, we believe that a continued voice phasedown does not impede the Commission from relying on the legal authority we have explained herein.
85. We also disagree with commenters who argue that the best approach to supporting broadband internet access service through Lifeline is to simply reclassify broadband internet access service as a Title II service. We find our approach today instead allows for the Lifeline program to fund broadband internet access service offerings, while also allowing the Commission to continue to apply a light-touch regulatory approach to broadband internet access service, and will promote investment and innovation without grafting costly and restrictive requirements onto a program that is focused on making vital services affordable. Free Press also raises the possibility that as providers transition away from offering switched telephone service they may not be eligible to participate in the Lifeline program with broadband internet access service classified as a Title I service. While Free Press casually raises this concern, it does not offer any evidence of it impacting the Lifeline marketplace today, or anytime in the near future. As such, we decline to address this concern at this time and believe that voice telephony as a supported service will not present any near-term challenges for providers.
86. We next make necessary adjustments to the Commissions rules.
In the 2016 Lifeline Order, the Commission amended 54.101 of its rules to include broadband internet access service as a supported service. As we discuss above, the classification of broadband internet access service as an
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