Tuesday, October 27, 2009

Telecom: Tracfone developments

A bit outside my field, but the California Public Utilities Commission just issued a draft rejection of Tracfone's request to be designated a recipient of federal universal service monies, basically on the theory that Tracfone can't have it both ways:
We find that it is neither competitively neutral nor otherwise in the public interest to certify a carrier as eligible for universal service funding when that carrier refuses to contribute to legally mandated programs to insure universal service, programs into which the carriers’ competitors pay and which fund the very sort of universal service which is the goal of the ETC program. It also is not in the public interest to grant ETC designation to a carrier that denies the authority of the State agency charged with insuring universal telephone service and protecting the public’s interest, convenience and necessity.

It's always interesting to see new market entrants negotiate old regulatory spaces. To what extent should they be able to cast off old regulatory structures aimed at previous architectures? The reference to competition is the key: Tracfone is competing with old market participants who are subject to the full regulations.

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