NATaT Weekly Legislative Report

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Draft 2024 NATaT Policy Platform - 2/23/2024

NATaT Interconnect

August 1, 2024

Capitol Hill

Senate Commerce Markup ─ ACP Funding Advances: The Senate Committee on Commerce, Science, and Transportation held an executive session yesterday to consider various legislation including several bills related to broadband and artificial intelligence (AI). The committee passed the PLAN for Broadband Act (S. 2238), which would direct the Assistant Secretary of Commerce for Communications and Information to develop a National Strategy to Close the Digital Divide. The bill includes approved amendments that add $3.08 billion more to the Federal Communications Commission's (FCC) "Rip and Replace" program and appropriate $7 billion for the Affordable Connectivity Program (ACP).

The committee also passed the Network Equipment Transparency (NET) Act (S. 690), which would direct the FCC to evaluate and consider the impact of the telecommunications network equipment supply chain on the deployment of universal service, and the Rural Broadband Protection Act of 2023 (S. 275), which would require the FCC to establish a vetting process for prospective applicants for high-cost universal service program funding.

In addition, the committee passed 10 AI-related bills including The Future of AI Innovation Act (S. 4178), which would create important partnerships between government, the private sector, and academia to establish voluntary standards and best practices to support innovation and research.

Senate Passes Online Safety Bills: On July 30, the Senate passed the Kids Online Safety Act (KOSA) and the Children’s and Teens Online Protection Act (COPPA 2.0) by a vote of 91-3. KOSA (S. 1409) seeks to address various issues related to the exposure of minors to harmful content and their data privacy while online. It provides for more robust parental tools and controls to monitor online activity for users under age 17 and mandates online platforms to be transparent about their practices. COPPA (S. 1418) is a proposed update and expansion of COPPA 1.0, which passed in 2000. The updated bill extends protections beyond children under 13 to include teenagers up to the age of 16, provides enhanced data privacy protections, and prohibits targeted advertising to children and teens. House Energy and Commerce Chair Cathy McMorris Rogers (R-WA) hopes to schedule markups of companion legislation (H.R. 7891 and H.R. 7890) in the fall.

T-Mobile-U.S. Cellular Merger Scrutiny: Six senators led by Elizabeth Warren (D-MA) have written a letter to Jonathan Kanter, Assistant Attorney General for the Antitrust Division of the Department of Justice (DOJ), and Jessica Rosenworcel, Chair of the FCC, requesting both closely scrutinize T-Mobile’s proposed $4.4 billion acquisition of US Cellular. If approved, the senators said the merger could “potentially lead to higher prices and other harms for consumers across the country.”

Broadband Permitting Bill Introduced: Sens. John Thune (R-SD) and Ben Ray Luján (D-NM) introduced the Accelerating Broadband Permits Act, which would improve federal agencies’ review and processing of broadband permits and allow service to be more quickly deployed to unserved communities. According to a press release, “The legislation cuts unnecessary red tape, increases transparency into the federal permitting process, and requires all federal agencies to implement controls to ensure broadband applications are being processed within the required 270-day deadline.”

Chevron Deference Bill Introduced: Sen. Elizabeth Warren (D-MA) and ten of her Senate colleagues introduced the Stop Corporate Capture Act (SCCA), which would codify the Chevron deference doctrine into law, allowing expert agencies to conduct rulemakings in line with their reasonable interpretation of their authorizing statutes. The legislation has been endorsed by over four dozen organizations, including the AFL-CIO, Consumer Federation of America, and the Center for Digital Democracy. First introduced in the House by Rep. Pramila Jayapal (D-WA) in 2021, the bill takes on added significance after the Supreme Court’s June 28 ruling, which overturned the Chevron doctrine in Loper Bright Enterprises v. Raimondo, holding that it was inconsistent with the Administrative Procedure Act (APA) and gave unelected government officials too much authority.

ACP Support Bill Introduced: Reps. Mike Carey (R-OH) and Nikki Budzinski (D-IL) introduced the Secure and Affordable Broadband Extension Act, which would provide $6 billion in additional funding for the Affordable Connectivity Program (ACP) and an additional $3.1 billion for the FCC’s “rip-and-replace” program. Sen. Ben Ray Luján (D., N.M.) introduced the Senate version (S. 4317) in May.

AI Consolidation Concerns: Sens. Ron Wyden (D-OR), Peter Welch (D-VT), and Elizabeth Warren (D-MA) have written a letter to Lina Khan, Chair of the Federal Trade Commission (FTC) and Jonathan Kanter, Assistant Attorney General for the Antitrust Division of the Department of Justice (DOJ) regarding concerns about undue consolidation in the emerging generative artificial intelligence (AI) industry and the threats it poses to consumers, innovation, and national security. The senators said “sustained, pointed action is necessary to fight undue consolidation across the industry."

AT&T Data Breach: In a letter to AT&T CEO John Stankey, Rep. Abigail Spanberger (D-VA) expressed her grave concern about the company’s July 12 disclosure of a data breach that exposed customers’ phone numbers, call duration times, and location data between May 1, 2022 to October 31, 2022. She sought answers about the effectiveness of AT&T’s incidence response plan and whether the company would offer free fraud monitoring services to affected parties. The FCC said it’s conducting an “ongoing investigation” into the breach and is coordinating with law enforcement partners.

Administration and Courts

FCC Pole Attachment Order: On July 26, the FCC issued a Public Notice announcing that new pole attachment rules, which the FCC adopted in a December 2023 Report and Order, are effective as of July 25, 2024. The order establishes the Rapid Broadband Assessment Team (BRAT), an inter-agency rapid response team to provide coordinated reviews and assessments in pole attachment disputes and recommend dispute resolution procedures. The order also requires pole owners to provide attachers, upon request, with their most recent cyclical pole assessment reports or any intervening periodic pole inspection reports for poles covered by an attachment application.

FCC Mobile Speed Test App: The FCC recently launched a new Mobile Speed Test app designed to help users assess the performance of their mobile broadband connections. This new app replaces the original FCC Speed Test app and offers several enhanced features aimed at providing more accurate and reliable data on mobile coverage. One new feature enables users to dispute provider-reported coverage data or conduct Crowdsource Tests to contribute to the overall evaluation of mobile coverage across the country.

BEAD Eligible Technology Guidelines: Alan Davidson, Administrator of the National Telecommunications and Information Administration (NTIA) said the agency plans to release updated guidelines in the coming weeks regarding BEAD grant funding and eligible technologies. These guidelines will include information on the utilization of alternative, non-fiber-optic technologies for broadband deployment. This is intended to help achieve universal coverage, especially in areas where fiber deployment is not feasible. Additionally, the NTIA has confirmed that fixed wireless broadband provided through "licensed-by-rule" spectrum will be considered reliable and eligible for BEAD funding.

ConnectHomeUSA Selectees: The U.S. Department of Housing and Urban Development (HUD) announced that 97 communities have been selected to participate in the ConnectHomeUSA (CHUSA) initiative, bringing training and technical assistance to help communities access affordable internet access, affordable devices, and digital skills training.

DDoS Election Attacks: The FBI and CISA issued a PSA to raise awareness that Distributed Denial of Service (DDoS) attacks on election infrastructure, or adjacent infrastructure that supports election operations, can hinder public access to election information but would not impact the security or integrity of election processes.

Federal and State Grant Opportunities

NTIA Digital Equity Competitive Grant Program: NTIA is accepting applications for the Digital Equity Competitive Grant Program, which provides $1.25 billion in funding to support efforts to achieve digital equity, promote digital inclusion activities, and spur greater adoption and use of broadband among covered populations. Deadline: September 23.

FCC Schools and Libraries Cybersecurity Pilot Program: A Federal Register notice said most parts of the FCC’s Schools and Libraries Cybersecurity Pilot Program will become effective on August 29. The new program will provide up to $200 million over a three-year period to participating eligible schools, libraries, and consortia of schools and libraries, to defray the costs of eligible cybersecurity services and equipment. It is modeled after the FCC’s Connected Care Pilot and aims to evaluate the effectiveness of using Universal Service funding for cybersecurity services and equipment. Deadline: TBD.

FY 2024-2025 State & Local Cybersecurity Grant Program: The California Office of Emergency Services is accepting applications for the $19.1 million grant program, which provides awards of up to $250,000 to assist California local governments, including school districts and special districts, and federally recognized tribes address cybersecurity risks and threats to information systems, and improve security of critical infrastructure and resilience of the services provided by these entities. Deadline: September 27.

Recent Federal Court Decisions

Court Stays FCC Open Internet Rules: Today, the U.S. Court of Appeals for the Sixth Circuit stayed the FCC’s recently adopted Open Internet Rules, which were set to go into effect August 5. “Because the broadband providers have shown that they are likely to succeed on the merits and that the equities support them, we grant the stay,” said the court its order. The Sixth Circuit’s action delays the FCC's Open Internet rules from going into effect while the court decides the merits of Ohio Telecom Association v. FCC, a suit filed by Internet Service Providers like AT&T, Comcast, and Verizon.

USF Contribution Mechanism Ruled Unconstitutional: On July 24, the U.S. Court of Appeals for the Fifth Circuit in an en banc review ruled in Consumers' Research vs. FCC that the FCC's method of funding the Universal Service Fund (USF) program is unconstitutional. The court said USF contributions are a tax, rather than a fee, and that Congress violated the nondelegation doctrine by allowing the FCC to create and control a system for collecting money to finance the USF without providing sufficient guidance. The combination of Congress's broad delegation to the FCC and the FCC's sub-delegation to the Universal Service Administrative Company, a private entity that administers the contribution mechanism, violated the U.S. Constitutions Vesting Clause. The Fifth Circuit remanded the decision to the FCC, and the Commission is expected to petition the Supreme Court for an appeal. The high court will likely hear the case and grant a stay, but the legal uncertainty will spur additional pressure on Congress to revamp the USF contributions mechanism.

Industry and Advocacy

One Strike and You're Out: CrowdStrike blamed a bug in its test software for a recent incident that caused 8.5 million Microsoft Windows systems to crash. The issue stemmed from a faulty "Content Validator" that failed to catch problematic content in a July 19 update. This led to an out-of-bounds memory read in CrowdStrike's Falcon Sensor, triggering crashes. CrowdStrike plans to enhance its testing procedures and release controls to prevent future issues.

Cutting the Cord: Comcast's Q2 2024 results show a 2.7% decline in revenue to $29.7 billion and a 7.5% decrease in net income to $3.9 billion. Adjusted EPS rose 7% to $1.21. Connectivity & Platforms saw a record 41.9% Adjusted EBITDA margin. Media Adjusted EBITDA grew 9%, driven by Peacock's improved performance. Despite challenges in Studios and Theme Parks, Comcast remains optimistic about future growth opportunities.

Can You Hear Me Now?: Verizon's Q2 2024 results show a slight revenue increase of 0.6% to $32.8 billion, though this missed analyst expectations of $33.1 billion. Wireless service revenue grew by 3.5% year-over-year to $19.8 billion. The company added 148,000 postpaid phone subscribers and 391,000 total broadband subscribers. However, Verizon Business revenues fell by 2.4%. Despite mixed results, Verizon maintained its full-year guidance for wireless service revenue growth and adjusted EPS.

T-Mobile Posts Strong 2Q24 Results: T-Mobile reported strong financial results for the second quarter of 2024. The company added 1.2 million postpaid customers and 405,000 high-speed internet customers, It also reported total service revenues of $16.4 billion, a 4% increase year-over-year.

Coax-isting Together: T-Mobile and KKR have announced a joint venture to acquire MetroNet, a fiber-to-the-home provider, to expand their broadband infrastructure. T-Mobile will invest $4.9 billion for a 50% equity stake in the JV and full ownership of MetroNet’s residential fiber operations. This acquisition aims to enhance T-Mobile's broadband offerings alongside its 5G Home Internet service, targeting increased fiber network reach and faster broadband services for millions more households. The transaction is expected to close in 2025, pending regulatory approvals.

But Can It Play Snake?: Nokia has launched Broadband Easy Connect, a subscription-based service aimed at streamlining the fiber connection process for operators. The cloud-based platform automates scheduling, dispatching, and verifying field operations, reducing costs and connection times. It includes tools like ONT Easy Start and Optical Link Certifier for service activation and line testing. Nokia claims this service can improve first-time connection success rates to 95% and speed up fiber deployment by 20%.

Tillman Secures Funding for FL Fiber Network:

Tillman Fiber has secured $1 billion in financing to support its fiber-to-the-home (FTTH) network deployment across Florida. The funding includes $815 million in committed debt financing and up to $200 million in additional term loans. This investment will accelerate the rollout of high-speed fiber infrastructure, enhancing broadband connectivity. The financing was led by a syndicate of major financial institutions, underscoring confidence in Tillman Fiber's strategy and operational excellence.

NATaT Weekly Legislative Report

September 30, 2024

Congressional Outlook

Following the vote, Lawmakers will go on a month-long October recess, returning after the general election with just 20 legislative days to pass a long-term solution to government funding.

After Category 4 Hurricane Helene tore through the Southeast, killing over 100 and more than 600 missing, President Joe Biden said Congress may need to return early to pass an emergency supplemental. The 800-mile path of the hurricane left over 2 million homes and businesses without power and will surely bring billions of dollars worth of damage to communities. The legislation passed by Congress last week opened up $20 billion in FEMA disaster relief funds. However, FEMA has allocated $6 billion of that funding to efforts for flooding in Vermont and wildfires in Hawaii. Lawmakers from affected states are calling for Congress to return early and take action on a supplemental package.

Bills and Regulations of Interest to You

Week in Review

Congress funds the government but faces another shutdown threat before Christmas

Biden signs three-month funding bill to avert US government shutdown

Biden floats recess action on Helene supplemental

House approves GOP resolution condemning Biden and Harris over Afghanistan withdrawal