July 2018
News and Updates
Here are some updates from the Texas Telephone Association. View as Webpage
Update from Executive Director Lyn Kamerman
Texas PUC rulemaking implementing Senate Bill 586 advances
The Texas Telephone Association and the Texas Statewide Telephone Cooperative, Inc. on July 9 filed joint initial comments in the Public Utility Commission of Texas proceeding implementing changes to the Texas Universal Service Fund under Senate Bill 586. 
After the PUC published the proposed rule in May, TTA and TSTCI have worked diligently across both organizations to develop extensive joint comments that included input from all members. TTA and TSTCI’s comments addressed issues such as the timing of compliance reports and what information should be reported as well as procedural issues and editorial issues. TTA and TSTCI’s comments included proposed redlined edits to the rule as well as revised compliance forms and instructions for completing those forms. 
In addition to TTA and TSTCI, the Texas Cable Association and the Office of Public Utility Counsel (OPUC) filed brief comments. The cable association in its filing primarily addressed the treatment of “make-whole” support that some small Incumbent Local Exchange Carriers receive under the Public Utility Regulatory Act 56.025. That provision allows a small ILECs to recover losses in federal universal service funding through state universal service. OPUC in its filing primarily addressed the confidential treatment of compliance reports in any subsequent Texas universal service fund adjustment proceeding as well as the importance of the PUC to consider the adequacy of local rates in any adjustment proceeding. 
TTA and TSTCI are preparing draft reply comments. The Texas PUC staff has indicated interest in submitting the final rule for consideration by the full commission at its August 23 open meeting.

There are several other items of interest pending at the Texas PUC.

Virgin Mobile on June 29 filed an application with the Texas PUC to expand its lifeline-only designation into additional rural areas across Texas.
Virgin Mobile has been designated as both an Eligible Telecommunications Carrier (ETC) and an Eligible Telecommunications Provider (ETP) in certain non-rural service areas of Texas – including AT&T Texas, Verizon Southwest and Frontier – for the limited purpose of offering Lifeline services. Virgin Mobile’s application seeks to expand the area covered by those designations to include territory served by additional local phone companies across Texas.
While many pre-paid wireless companies have jumped into the Lifeline program over the past decade, this represents the first time since 2003 that a wireless provider has sought to be designated as an ETC/ETP within parts of a rural telephone company’s service area.
In 2003, the Texas PUC considered Dobson’s request to be designated a Lifeline provider in parts of small local phone company service areas. In that proceeding, the Texas PUC required Dobson to seek designation throughout a rural telephone company’s service area if they wished to be designated within any part of the area. This decision resulted in Dobson withdrawing its request for ETC/ETP designation within many of the Incumbent Local Exchange Carrier service areas because the company was unable to serve the entire area.
Wes Robinson with Eastex Telephone Cooperative, Inc. is spearheading an effort to oppose Virgin Mobile’s request. To the extent that you are interested in participating, please contact Wes at wes@eastex.com .
Association News
Legislative Update – John Hubbard and Ian Randolph
The transition of Texas from a mainly rural agricultural state to a more urban economy has been a hot topic of discussion in recent years. But that rural-to-urban transition does not mean that rural issues will be totally ignored or put on the back burner by the Texas Legislature in the future. In fact, rural issues can still rise to a high level of importance — particularly because, after all, the rural population of Texas equals that of 22 other states.
One rural issue the Legislature addressed in the 2017 session was an issue with the state’s formulas for financing public schools that provides small rural schools with additional funding to compensate for their higher per student costs. In other words, it costs more to educate one more student in a small rural school than in a large urban school because there are fewer staff in rural schools over which to spread costs.

The issue with the “small schools” formulas stemmed from the fact that there were two versions of the formula: one for districts with more than 300 square miles and one for districts with fewer than 300 square miles. This unnecessary complication provided less funding to the geographically smaller school districts – although the geography of a district had nothing to do with the costs to educate a child. Transportation costs are not part of the “small schools’’ formulas and are handled through a separate set of formulas.
The Texas Association of Rural Schools (TARS) — a long-time client of ours — led the fight to eliminate this unnecessary complication in the formulas. We helped TARS develop a strategy very similar to our strategy in securing approval of Senate Bill 586 for TTA in 2017. TARS member superintendents educated legislators at home while we educated legislators and staff and addressed procedural issues here in Austin. After a significant fight in both the Senate and House of Representatives we were ultimately successful in eliminating the version of the formula that penalized rural school districts with fewer than 300 square miles. Not only did this change provide more funding to those districts, it eliminated an unnecessary complication in the already byzantine school finance system.
No question, Texas is no longer a rural state. But rural issues remain important and can be addressed with the right strategy and hard work — something for TTA members to keep in mind as we look toward the 2019 session of the Texas Legislature.
As always, please let us know if you hear anything in your neck of the woods that can impact our member companies or if you have any questions. We’re here to help.

Have you registered yet? TTA Convention and Product Showcase set for Sept. 9-12
Plans are shaping up for the 2018 Texas Telephone Association Convention and Product Showcase. Some 150 telecommunications industry professionals will gather Sept. 9-12 at Horseshoe Bay Resort.

A complete agenda and registration information as well as hotel information can be found online here . A complete agenda and registration is available for download here .

The deadline to book rooms at the discounted conference rate at the Horseshoe Bay Resort is August 7. Click here for booking information.
Registration open for Moss Adams Telecommunications Conference
Registration is open for the “2018 Moss Adams Telecommunications Management Conference: A Roadmap for the Future.’’ The conference is scheduled for August 14-15 in Dallas.

Scheduled speakers include: Darren Woodson, three-time Super Bowl Champion and former all-pro NFL player and Jonathan Spalter, the president and CEO of USTelecom.
The conference will focus on the impact of new and revised operational and regulatory requirements on the telecommunications industry, provide guidance on creating successful financial strategies in an evolving regulatory environment and highlight company success stories. 

For more information or to register visit the conference registration page .
Registration open for Calix ConneXions Innovation and User Conference 2018 
Registration is open for the Calix ConneXions user conference scheduled for October 27-30 in Las Vegas.

“Calix ConneXions is where pioneers and thought leaders come to debate, collaborate and learn about the latest innovations that winning service providers are using to evolve their business models,’’ according to the conference website.

Early bird rates are available. For more information visit www.calix.com/connexions .  
Member Spotlight
Totelcom upgrading networks to fill bandwidth demands

In an increasingly interconnected world, Totelcom is rapidly expanding its fiber network footprint to meet community demands for high-speed Internet and broadband.

“It’s all about bandwidth being available for the customers,’’ said Toney Prather, president of Totelcom. “The speeds we’re delivering now – I wouldn’t have imagined it 10 years ago. We’re becoming more interconnected. Everything in our house is tied to the Internet now.”

Totelcom , based in De Leon, serves a local service territory spanning 1,182 square miles covering primarily Comanche County in Central Texas. With 40 employees, Totelcom provides voice and high-speed Internet services to consumers, schools and hospitals as well as wind, energy and agricultural customers in the largely rural area. Totelcom’s competitive local exchange carrier affiliate provides voice and high-speed data services to area businesses and institutions, including Comanche and Stephenville.

“We have less than three customers per square mile,’’ Prather said.
Totelcom is family-owned and operated by Prather, who has worked for the company since 1979, and his wife Terrie. In 2010, their daughter Jennifer Otwell left a Dallas public accounting firm to join the company, making it a multigenerational family business. Toney and Terrie’s son, Michael Prather, in 2012 returned to Texas from a New Mexico telecommunications company to join the family business.
Totelcom operates a network that mixes copper, fiber and fixed wireless. Totelcom has been rapidly investing in upgrading its networks and is expected to spend about $18 million by 2022 in deploying fiber and expanding its network capacity with speeds of 1 gigabit per second.
“Gone are the days people are worried about a voice call,’’ Prather said. “As capital is available we’re putting it back into the network. We just keep expanding our fiber footprint deeper into our network. It’s going to be a full-time job for a long time.’’

“It’s not about phone lines anymore. It’s about data,’’ Prather said.
Otwell, vice president and general manager of Totelcom, said the company deploys fixed wireless on the edges of the network to expand its reach and make sure the company is providing customers “the best experience we possibly can.’’

Totelcom has deployed fiber technologies to support schools, hospitals and businesses.
Totelcom provides a fiber-based high-speed data backbone for Tarleton State University in Stephenville that supports everything from the administration to student services. In addition, the network enables Tarleton to connect with sister campuses within the Texas A&M University System.

In addition, Totelcom deployed seven miles of fiber to support Logan’s Gap Wind facility, which contains 87 wind turbines, Otwell said.

Totelcom provides high-speed data services to Comanche County Medical Center, a largely rural hospital that is located between DeLeon and Comanche. Totelcom deployed about eight miles of fiber to connect the hospital, which provides vital health care services to area residents, including a large elderly population. The fiber-based high-speed data services support operations as well as CT scans, mobile MRIs and area clinics as well as telehealth and telemedicine services.

Totelcom in 2017 was recognized by NTCA – the Rural Broadband Association – as a “Smart Rural Community.’’  NTCA recognized Totelcom for advanced communication services and collaboration with local leaders as keys to its success.

Prather said many consumer customers have “cut the cord’’ and are giving up voice service in favor for data-only high-speed Internet access. With more and more consumers working from home and receiving entertainment online, Prather predicts consumer demand for high-speed Internet will continue to grow.

“It’s a constant demand for bandwidth,’’ Prather said.

Totelcom and its employees are active in local communities and the company supports fundraisers, events and other community projects. The majority of Totelcom employees grew up the area.

“We remain close to our community,’’ Prather said. “The thing we are really the most proud of is we feel we are a vital, important part of this community.”
In the State and Around the Nation
FCC establishes new rules to measure broadband performance
The Federal Communications Commission on July 6 issued an order  adopting broadband performance testing standards for certain recipients of federal high-cost universal service support. 
Specifically, the FCC established a uniform framework for measuring speed and latency performance standards for recipients of high-cost support to serve fixed locations. 
Under the new standards, the FCC allows affected providers the option of measuring broadband performance using one of three different testing methods. These include: Measuring Broadband America (MBA) testing infrastructure; existing network management systems and tools; or provider-developed self-testing configurations.
In addition, the FCC is requiring providers to submit testing results as part of their annual compliance certification, which is included in FCC Form 481. Carriers that do not comply with the speed and latency requirements could be subject to a reduction in support that is commensurate with their level of noncompliance. Providers are also subject to an audit of all testing data.
F CC sets stage for eventual implementation of nationwide number portability
The Federal Communications Commission on July 12 set the stage for nationwide number portability and “expand to consumers the benefits of competition currently provided by local number portability.”
Number portability is the ability to keep an existing phone number when changing carriers and locations, allowing consumers and businesses to retain the convenience and value of a familiar number in changing circumstances. However, currently consumers are not able to fully port a number to any wireless or wireline provider.
To pave the way for nationwide number portability, the FCC is modifying rules that were designed for an “older market structure of separate local and long-distance calling,’’ the FCC said in a news release .

“These antiquated rules are not applicable to today’s integrated all-distance services, impede nationwide number portability, and frustrate efficient use of the telecommunications network,’’ the FCC said.
The FCC adopted a report and order  that modified rules relating to interexchange dialing parity requirements applicable to competitive local exchange carriers, which is similar to the relief that the FCC granted for incumbent local exchange carriers in 2015. 
The changes include eliminating the last vestiges of the “dialing parity” rule. This rule was intended to make sure consumers could choose and access a stand-alone long-distance provider without dialing extra digits. However, stand-alone long-distance service is disappearing with the rise of all-distance plans, Voice over Internet Protocol and wireless, and the FCC in 2015 eliminated the rule for most local providers and the latest action eliminates the rules for competitive providers, and for stand-alone services grandfathered in 2015.
The FCC’s changes also provide flexibility in call routing by easing the “N-1” rule that currently requires the next-to-last carrier in a call – typically the long-distance provider – to query the number portability database. The modification allows other carriers in the chain to query the database. The FCC in its latest order, is lifting that obligation so a local phone company would be able to push customers to its own all-distance calling plans. 
However, because of state requirements in Texas, local phone companies in Texas will continue to have intrastate interexchange equal access requirements and will be required to continue to offer customers a choice in their interexchange carrier.
FCC announces 220 participants in the CAF Phase II auction
Let the bidding begin.
The Federal Communications Commission on June 25 issued a public notice announcing 220 applicants are eligible to bid in the Connect America Fund Phase II reverse auction, set to open on July 24. The eligible applicants include some members of the Texas Telephone Association.
Under the CAF Phase II auction, the FCC will conduct a reverse auction to award up to $1.98 billion over the next 10-year period for providers to offer voice and broadband service to locations in high-cost areas. The FCC posted an online auction tutorial for participants. 
Congratulations to those TTA members participating in the auction. 
WTA calls for increase in universal service fund high cost program
The period for public comment on the Federal Communications Commission’s notice of proposed rulemaking on the budget for the universal service fund high cost program has come to a close.
WTA filed comments focusing on making sure the high cost program budget for rate-of-return rural local exchange carriers is sufficient for carriers that opted into Alternative Connect America Cost Model (ACAM) and for those that remained on the cost-based system.
In its initial comments, WTA proposed a budget for the 2018-2026 period that includes full funding of ACAM support up to a per-location funding cap of $200, as well as full funding of the High Cost Loop Support and C onnect America Fund Broadband Loop Support (CAF BLS) mechanisms, including Consumer Broadband-Only Line services increasingly demanded by the customers of cost-based rural local exchange carriers.
The WTA budget proposal calls for a total budget of $2.426 billion for 2018 (which includes the existing $200 million of additional Connect America Fund reserve funding) and for gradual annual increases that will ultimately reach a total rate of return budget of $2.975 billion in 2026. In addition, WTA supported a second ACAM offer for glide path carriers.
WTA also expressed its opposition to lowering the per-line cap on monthly universal service fund support, replacing the competitive overlap process with auctions, and combining the HCLS and CAF-BLS mechanisms into one. WTA also opposed adding means testing and vouchers to the high cost fund.

In reply comments submitted on June 26, WTA reiterated its support for a budget increase and expressed agreement with US Telecom and NTCA that the rate-of-return high-cost budget should be a single budget rather than a series of separate program budgets. WTA also urged the FCC to adopt and implement a second model offer for glide path companies and to encourage as much glide path participation as is feasible.
In the News
YK Communications has announced that Phase 3 of the El Campo fiber project is now underway and is on schedule for completion by the end of 2018. Phase 3 includes Highway 71 South from Highway 59 to the community of Danevang, and customers in this new service area can expect to be installed as early as September 2018. “Not only will YK Communications be able to connect homes and businesses along Highway 71 to fiber, but this will allow us to tap into other areas of our network and provide a more robust connection for all of our El Campo customers,” commented Russell Kacer, President. Read more.

AUSTIN — There are times when volunteer firefighter Jerry Bell could really use a broadband internet connection to find water or to pull up Google Maps for a better fix on his location. But because Bell and his fellow Lake Palo Pinto Volunteer Fire Department members often find themselves battling a blaze miles from town, that’s not available. “Once you get out in the field you can’t get anything,” said Bell, who lives in Gordon, a city of about 470 people, 65 miles west of Fort Worth in Palo Pinto County. “For rural counties, this is a problem.” Read more.

Rural connectivity schemes typically focus on overcoming last mile issues, oftentimes at the expense of figuring out answers to the myriad of other challenges related to backhaul, core, OSS/BSS. Read more.

For far too long, Rural Utilities Service (RUS) loans have funded telephone and broadband service with few assurances that the money is being deployed in legitimately unserved areas across the country. This is problematic for rural communities striving to compete for services and jobs against regions that have broadband service. The lack of infrastructure buildout to unserved communities will become even more apparent as the U.S. races to become a leader in 5G and broadband deployment. Read more.

When they set out on their own in 2012 after more than two decades working for one of the most revered names in the cable industry — the late Bill Bresnan, founder of Bresnan Communications — Jeff DeMond and Andrew Kober had a clear vision of where their respective futures lay. Broadband was the key. Read more.

Chinese tech giant Huawei has written to the Federal Communications Commission (FCC) arguing that the United States should not miss out on its market-leading technology, also pointing out that its exclusion would drive up consumer costs for mobile services. Huawei's comments came in response to the FCC's notice of proposed rulemaking (NPRM) for  Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs . Read more.

It’s official: President Donald Trump ended weeks of speculation Monday by nominating D.C. Circuit Court Judge Brett Kavanaugh to replace the retiring Supreme Court Justice Anthony Kennedy. Democratic leaders are raising red flags about many of Kavanaugh’s past rulings, but Senate Republicans have the slim majority necessary to confirm the judge if they can prevent any defections. Kavanaugh, one of the most prolific jurists Trump considered, has made rulings in a wide array of cases, including many related to telecom issues. Read more.

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