Federal Communications Commission FCC 07J-4
STATEMENT OF
COMMISSIONER LARRY S. LANDIS
In the Matter of High-Cost Universal Support, WC Docket No. 05-337; Federal-State Joint 
Board on Universal Service; CC Docket No. 96-45
The proposals contained in todays Recommended Decision provide the framework for 
significant and much-needed reform of the high cost universal service program. Whether the promise 
inherent in those reforms is realized depends almost exclusively on what happens next, and on how the 
details of the framework outlined here may be implemented. Those processes and mechanisms must be 
weighed with great care, because in any public policy decision the odds are reasonably high that when we 
get to granular implementation the end result will be to produce outcomes which are unintended, 
undesired, or both.
 The level of participation among stakeholders in this proceeding, together with the robustness of 
the comments and replies, as well as the ex parte communications, has contributed materially to the 
thinking leading up to todays Recommended Decision. While it is to be expected that the input of 
stakeholders will reflect their respective interests, for the most part they were thoughtful, productive, 
constructive and even imaginative, as opposed to reflecting an entitlement mentality which has at times 
clouded this ongoing debate.
 There are four sections of this Recommended Decision which I believe warrant brief comment, 
because of the critical importance of getting it right when it comes to actual execution of the 
recommendations set forth here.
 The first is the discussion of issues related to current mechanisms as they impact incumbent LECs 
(participants in the POLR fund, as proposed).1 Competition is a reality today not only in our urban 
centers, but also increasingly in the small towns, villages and rural communities which are the population 
cores of rural areas across the country. It is essential that POLR support be matched as closely as possible 
to the high cost exurban (truly rural) areas.  This requires adoption of improved analytical and modeling 
techniques to examine those costs at a far more granular level than has been heretofore been possible.
Failure to align support with costs as closely as possible could put rural service at risk as surely as the 
unmanaged ballooning of the high cost program.
 An outgrowth of that concern is a recognition that rural is rural, and the time for distinguishing 
among RLECs, midsize companies and the largest LECs is past. Just as telecommunications policy 
should be technologically neutral, it should be neutral when it comes to providing appropriate support to 
those residing in high cost areas, regardless of the corporate logo or size of the provider delivering the 
service.
 Second, great care and attention must be given to the method by which a transition from the 
existing, increasingly dysfunctional mechanisms to the proposed new Funds is effected. In the 
Recommended Decision, appropriate attention is given to the importance of effecting the transition over 
time, to give providers the time required to adjust their business models to account for shifts in emphasis 
and process. Too frequently, particularly when it has come to communications policy, remediation has 
taken the form of a flash cut to a new and presumably better framework.
That said, virtually nothing is said in this recommendation about the transition mechanism itself.
That process should be guided by the first principle in the Hippocratic oath: Do no harm. Or if that is 
not possible, close attention should be given to minimizing the harm which occurs. A great deal has been 
said and written, including in this Recommended Decision, about the undesirability of continuing 
subsidized competition. We need to recognize that the providers who have benefited from the 
  
1 See paragraphs 19-23 passim, esp. paragraph 22.
Federal Communications Commission FCC 07J-4
2
pathology of the existing system have done so in a manner which is entirely legal, if less than visionary.
 It is essential that one provider not be advantaged over others as the proposed modifications to support 
for competitive, especially wireless, ETCs occur and wireless providers are transitioned to the proposed 
Mobility Fund.2
Third, it is time for the states to have a stake not only in policy decisions and in the administration 
of the high cost universal service program, but also to step up to at least a modest role in its funding. As 
our former colleague Billy Jack Gregg has pointed out, several states which are among the largest net 
recipients (disbursements less collections) of funds under the federal universal service program do not 
have a state universal service program or any other program targeted to address issues such as those 
addressed in this Recommended Decision.
I strongly support the recommendation that state matching funds3 should be a requirement for 
receipt of maximum funding under the proposed Broadband fund, and further believe comment should be 
sought on whether it is appropriate to structure all three funds in that manner, perhaps consistent with 
ability (but independent of political will) to pay for those states seeking to maximize the funds allocated 
to service areas within their boundaries.
Fourth, I concur in the view of my colleagues who support redefinition of supported services to 
include broadband, employing a mechanism such as that outlined in this recommendation. It is beyond 
debate that there are those areas in which buildout is sufficiently costly that no business case can be made 
for buildout, regardless of the technology under consideration, and it is to those areas I would expect the 
broadband dollars would be primarily directed.
An approach which draws upon the expertise of the states and which follows a logical 
progression such as is outlined in this Recommendation,4 relying primarily on the private sector for
addressing unserved areas5 and utilizing funds from the Broadband Fund as a funding source of last 
resort will best and most efficiently reach the goal of ubiquitous broadband availability. Given that 
many states still do not have an accurate assessment as to precisely how widely available broadband is, 
and where it is and is not available, enthusiasm should be tempered by a degree of caution. I support the 
initially incremental approach which is contemplated by a $300 million initial funding level. I hope that 
thereby we can avoid the temptation to unnecessarily throw resources at a need before its scope has been 
clearly and precisely defined.
It may be appropriate to seek input into the latent barriers to achieving more pervasive broadband 
use. Those who are without computers, whether by choice or circumstance, are still largely precluded 
from robust broadband usage. We also need to take into consideration those who have made what, for 
them, is a rational decision that broadband is not a service they need or want, no matter how widely 
available and no matter what the cost.
  
2 See esp. paragraph 27.
3 See paragraphs 50-52.
4 See esp. Paragraph 54
5 Such as the community-based demand development program which is the core element of the Connect Kentucky 
and Connected Nation model