FCC’s New 25/3 Broadband Benchmark Speed Does Not Impact Speed Adopted for USF Support Purposes

The FCC recently redefined broadband as 25/3 Mbps solely for the purpose of its annual Broadband Progress Report to Congress, required under Section 706 of the Telecommunications Act, but the move raised questions throughout the industry nonetheless. At this time, the change does not affect federal universal service policy. The broadband speed standard for USF purposes for rate-of-return carriers remains 10/1 upon reasonable request and 10/1 build-out requirements for price cap carriers. So what does the boost to 25/3 Mbps mean?

This new speed standard allows the FCC to report to Congress under Section 706 that current broadband policies are failing. The finding that broadband is not being deployed in a timely manner empowers the FCC with additional authority under Section 706 to move forward with aggressive broadband-related policies. Until Chairman Wheeler decided to use Title II telecommunications regulations as the basis for the FCC’s upcoming decision on net neutrality, which it is set to act on later this month, the Chairman had planned to base its ruling on authority granted to the FCC in Section 706.

The Commission has used this tactic before. Shortly after declaring in its 2010 Broadband Progress Report to Congress that broadband wasn’t being deployed in a reasonable manner, the FCC used its Section 706 authority to adopt the original net neutrality rules. The FCC’s motivation for the speed standard increase appears to be the same today. The Chairman may be planning to once again use Section 706 as the basis for its net neutrality rules if his Title II proposal is either not adopted or is adopted but later overturned by the courts or Congress.

Will the speeds of 25/3 Mbps become a standard for universal service? JSI thinks that this is not likely to happen for some time. The FCC set 10/1 Mbps as the standard for USF purposes and this should continue, at least for the foreseeable future.

If you have any questions about the broadband speed standards, net neutrality or the FCC’s Section 706 report, please contact John Kuykendall in JSI’s Maryland office at 301-459-7590 or Douglas Meredith in JSI’s Utah office at 801-294-4576.

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