Recess has begun, so all the Senators can go off on little (or big) trips together.  They'll have with them a new draft Telecom Act of 2006 (enormous pdf).

To all the Senators who are carrying the draft (and the greater number of Congresspeople who just got the ad about the draft) -- I just want to let you know that you can take the first 71 pages out of your notebooks.  That's a repeat of the House bill, which is replaced by the amended Stevens language.  Only 200 pages left!

Now you're ready to plunge into the Universal Service Fund section. (You may want to do some preparatory reading -- Thomas Hazlett, What Does $7 Billion Buy?) 

The key take-away from the USF section:  it vests unlimited discretion in the Commission and the States to assess USF contributions based on any mechanism they choose (phone numbers, revenue, or something else, including assessments based on international portions of service).  Any entity providing broadband service to the public is covered -- as is any online voice application that is CAPABLE OF connecting to the public telephone system, even if it doesn't. 

To keep the numbers from getting too visible, the bill says that the money flow associated with USF will be kept out of the USG budget.

Other provisions in the bill require voice services that are capable of connecting to the traditional telephone network to carry other people's traffic and comply with whatever disabilities-related regulations the Commission comes up with.  This is, of course, in addition to the E911 and CALEA obligations the Commission already said it would impose on VoIP services.  (Plug for recent academic paper on E911/CALEA.) 

So here we have an admittedly broken, bloated, graft-ridden funding system that supports traditional telephone services (largely) and won't help US broadband penetration statistics.  The money to support this system is going to come from free or lowcost or commodity applications of various kinds that happen to use IP and are capable of connecting to those old-fashioned telephone services.  That will lessen the economic viability of these new services, while failing to support the provision of broadband in the US (something we all thought was a national goal).  And all of this will happen under the radar -- in impenetrable FCC proceedings addressed to services the traditional telcos can't stand -- without facing up to our national, general need to fund internet access.

It's true that the Bill sets up a new separate program called the "Broadband for Unserved Areas Program," to be administered by the USF, but that's for a small portion of the money collected for USF.  The vast bulk of the funding is going to go to propping up the existing broken system.

That brings us to p. 111.  On p. 112 there's a section called "network traffic identification accountability standards" that cries out for attention -- but I'll let that wait for tomorrow.  You're on vacation, after all.

[Meanwhile, the D.C. Circuit has asked the FCC and the DOJ separately to file 15-page briefs responding to the recently-filed petition for reconsideration as to the court's affirmance of FCC's interpretation of CALEA.  This is (limited, be cautious here) good news -- it means that the court is taking the petition seriously.]