Mixed Messaging

The first week of February, by most measurable factors, was pretty good for independent rural telcos. Not only did Senator Conrad Burn (R-Mont.) introduce what he's calling The Internet and Universal Service Act of 2006 or “NetUSA” bill, but the National Telecommunications Cooperative Association wrapped up its big six-day annual meeting in San Diego. This was after the Organization for the Promotion and Advancement of Small Telecommunications Companies completed its own event in Maui.

Among the heavy doses of back slapping that typically take place at large gatherings of rural carriers, there also was a sense of relief that perhaps Congress finally was going to tinker with the contribution end of the universal service and inter-carrier compensation equations to the liking of independents. Both issues are shaping into major political fights that won't be settled for some time. Fair or not, those that want to gut the USF and inter-carrier compensation will continue to portray both mechanisms as subsidies to carriers that have been living too high on the hog for decades.

NTCA, OPASTCO and others have joined forces to keep both intact and have reams of data to prove that without either, phone bills for many rural customers would skyrocket. Part and parcel with that effort is a portrayal of rural carriers as salt-of-the-earth types that are just getting by. The reality naturally is somewhere in the middle, and both groups would do well to not send mixed messages. It's an open secret — particularly among vendors paying the freight — that the big national shows put on by NTCA and OPASTCO often amount to boondoggles, complete with obligatory golfing and side trips for directors and their spouses who wouldn't know a DSLAM from Denny's Grand Slam. Carriers obviously are going to be more apt to attend shows in warm locales in the middle of winter. However, in the looming battle over both USF and inter-carrier compensation, it's going to become increasingly difficult to rationalize such shows with the “poor rural carrier” message.