The effort to modernize the troubled Lifeline program appears to be moving in the right direction.  AT&T has long supported the need to fix the program’s glaring administrative problems while allowing Lifeline eligible consumers to use their $9.25 discount on Internet access services. Last week, the FCC’s fact sheet outlined plans for a National Eligibility Verifier that should take eligibility decisions out of service providers’ hands, which truly has the potential to be a transformative change if properly implemented.  It could close the door on provider-initiated eligibility fraud and help re-focus the program on the consumers it was intended to serve.

What’s not clear in the fact sheet, however, is how long it will take before providers can stop performing all of these functions and whether the National Eligibility Verifier will take over any of the other administrative functions that providers are currently required to perform.  Our fingers will remain crossed until we see all the details, and we may not uncross until we get further down the road to implementation. But Chairman Wheeler and Commissioner Clyburn should be commended for championing this approach.

We also appreciate the proposal’s acknowledgement that legacy Lifeline rules impose costs and burdens on providers that discourage their participation.  Such rules can also stigmatize Lifeline customers. To the greatest extent achievable, Lifeline customers deserve to be treated the same as all other customers. The current federal rules make this hard enough, but, as USTelecom highlighted in a recent ex parte, allowing states to add or customize Lifeline requirements exacerbates this and creates a costly and complicated web of varying rules.  We are hopeful this insight will translate into improved requirements for providers and more competitive options for consumers.

Of course, the news is not all encouraging.  While a fact sheet is not much to go on, the one change that could ensure the most competitive options for consumers is nowhere to be seen.  And that is reform of the FCC’s legacy eligible telecommunications carrier (ETC) regime that continues to require all Lifeline providers to be ETCs and makes all high-cost ETCs participate in Lifeline.  There is unprecedented joint support from consumer groups and providers for not requiring Lifeline providers to be ETCs.  Modernizing the ETC rules is long overdue, and the FCC now has a golden opportunity to get the change started in this order.

It is also hard to imagine how the Commission can justify phasing out Lifeline support for standalone wireless voice but continue to support standalone wireline voice.  Lifeline consumers overwhelmingly choose wireless voice over wireline.  If any voice support is to be phased out it should be a technology neutral phase-out of support for all standalone voice. We also have to wait for the order to see if the Commission will address the current Lifeline “back end” payment process, which is as vulnerable to fraud and deserves as much attention as the “front end” eligibility process.

For a major reform of Lifeline to be successful, these details and others will have to be addressed wisely.  But that does not dampen our hope that the Commission now has the program headed in the right direction.  It’s also a useful reminder of what can be accomplished when all of the players – regulators, industry and consumer groups – agree on a problem upfront and then work together in good faith to solve it.  We’re happy to have played a small part so far, and stand ready to work with the FCC to help get this commendable effort over the finish line.



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