On November 24, 2015, the FCC released a pole attachment Order that moves to balance the rates paid by cable and telecom providers to pole owners. This Order partially grants the National Cable & Telecommunications Association’s (NCTA’s) petition for reconsideration. NCTA argued that pole attachment fees cable companies pay would increase sharply now that broadband service is categorized as a telecom service and would fall under the telecommunications pole attachment formula instead of the cable pole attachment formula. The FCC found that although it tried to equalize the two pole attachment formulas in 2011 by creating an option of two different calculations, both of which assumed three pole attachers in rural areas and five in urban areas, the formulas still could produce significantly different results. The new formulas now allow for the actual number of attaching entities in the area: two, three, four, or five instead of the fixed assumption of three and five attachers.

Cable attachments have just one formula, but telecommunications providers have two rate formulas, allowing pole owners to use the higher of the two results. To bring the telecom rates closer to the cable rates, the FCC changed only one of the telecom formulas in this Order. Because of this, telecom rates may not change if the second telecom formula is higher and used by the pole owner.

This is a double-edge sword for rural companies. The new formula could reduce the amount LECs can charge companies to attach equipment to its poles. On the other hand, if an electric utility owns the poles, it may have to lower the rates it is charging, if there is provision in the pole agreement to make rate adjustments.

If you have any questions or would like to see how the new formulas affect your company’s pole attachment rates charged to other providers, please contact Valerie Wimer at 301-459-7590.

Source: JSI e-Lert