Rural Territory Now Easier to Serve: FCC Waives Requirement to Serve Entire Rural Service Area

On April 15, 2013,  the FCC released an Order granting forbearance to Lifeline-only ETCs from the requirement that these ETCs serve the entirety of rural service areas.  Previously, in order for a Lifeline-only ETC to provide service in a rural area, the ETC would have to commit to offer service throughout the territory served by the incumbent rural telephone company.  An ETC’s only alternative was to petition for a redefinition of the rural company’s service area, a process that involves both the state and the FCC and can take years.  Now, Lifeline-only ETCs are free to serve all or just a portion of rural service areas.  The FCC stated that the new policy would increase competition, spur innovation among carriers, and would give consumers in rural areas more choice.  It brushed aside claims by rural telephone carriers that Lifeline-only ETCs would poach their customers and thereby drive up the per-line cost of providing service, explaining that states may still take such concerns into account when designating Lifeline-only ETCs.   This forbearance is not available to ETCs that receive federal high-cost support.