FCC Releases Voice Data and Explanatory Notes from Urban Rate Survey

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The Federal Communications Commission’s Wireline Competition Bureau has announced the posting of the fixed voice services data collected in the urban rate survey, and explanatory notes regarding the data, on the Commission’s website. This data was used to compute the 2014 rate floor for incumbent eligible telecommunications carriers and the reasonable comparability benchmark for voice services that were announced on March 20, 2014.

In the USF/ICC Transformation Order, the Federal Communications Commission determined that “ETCs must offer voice telephony service, including voice telephone service offered on a standalone basis, at rates that are reasonably comparable to urban rates,” and adopted a presumption that a voice rate is within a reasonable range if it falls within two standard deviations above the national average. As directed in the Order, the FCC’s Wireline Competition Bureau initiated an urban rate survey for fixed voice services. Based on the survey results, the Bureau has calculated that the average local end-user rates plus state regulated fees of the surveyed Incumbent Local Exchange Carriers (ILECs) in urban areas is $20.46, and the reasonable comparability benchmark for voice services is $46.96. Under the Commission’s rules, by July 1, 2014, all Eligible Telecommunications Carriers (ETCs) that are ILEC recipients of high-cost support must report the number of residential service lines for which the sum of the rate and state fees are below $20.46 as of June 1, 2014. In addition, each ETC, including competitive ETCs, must certify that the pricing of the voice services is no more than $46.96. Several entities, including NTCA – The Rural Broadband Association (NTCA) and the National Exchange Carrier Association (NECA), have filed joint petition requesting that the deadline for compliance with the 2014 local service rate floor be extended from July 1, 2014 to January 2, 2015. A coalition of public interest groups have asked the commission to either postpone the rate floor hike or phase it in more slowly because more time is needed to examine underlying issues.

The Commission is expected to take up this issue at its April 23 meeting. According to press reports, the draft item would increase the rate floor from $14 to $17 as of December 1, 2014 before increasing it again July 1, 2016.

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