“Incumbents Do Not Have a Veto!”

With those words, Asst. Sec Lawrence Strickling, head of NTIA, enables many applicants and others worried about the NOFA’s incumbent challenge clause breathe a little easier. And for those of us who’ve railed against this potentially destructive clause , there is also a bit of satisfaction for not giving up the fight.

Mr. Strickling and Jonathan Adelstein, Administrator for RUS, were responding to questions from the House Subcommittee on Communications, Technology & the Internet when Congresswoman Anna Eshoo (CA) pushed for answers about the clause. “I want to make sure there’s competition. If the incumbents can just knock out people because they don’t want any to come in, I don’t really think that’s the way for us to go.” (gotta love our Calif Congressional delegation)

Mr. Strickling gave a reassuring response from both gentlemen and a clearer picture of how this process will run.

Applications with infrastructure proposals have proposed to cover areas where there isn’t broadband coverage. Maps are being generated for these areas through a publicly accessible database so you can see the proposed coverage area. During the review period anyone, including incumbents, can submit a message on the site saying they agree or not that the areas currently are not receiving adequate broadband.

Because applicants had to provide detailed information to justify their claim that these areas need broadband, “incumbents have to provide a lot of information to overcome the presumptions that have been established by the applicants.” NTIA will evaluate the challenge if it feels the challenge and supporting material throws the proposal into dispute, but NTIA and not the incumbent will have final say in determining whether the app moves to final review.

Mr. Adelstein added, “We will demand real substantiation with any challenge. But also, we want to be sure that what applicants present is accurate. Claims have to be verified and substantiated.” Furthermore, RUS has over 400 offices across the U.S. and they will send people into the field to areas that incumbents challenge to test and assess the validity of any challenges.

Where does that leave us?

This isn’t a final knockout blow to the clause. Yet there is cause for some joy here.

First, NTIA/RUS is giving applicants the high ground and the presumption that you hold an unassailable position. The burden of proof to the contrary lies with the incumbent. If you’ve done your homework, and are continually gathering whatever data you can to reinforce the fact that people in your proposed coverage area don’t have adequate broadband, you can better fight off any challenge.

Second, political pressure matters here. When members of Congress such as Rep Eshoo say to NTIA/RUS they’re not going to be happy if they see proposals in their districts knocked out by incumbent challenges, you better believe this becomes a factor. Same holds true if governors start making phone calls. The Congressional and gubernatorial cards are in play.

Third, this challenge process will play out in a fishbowl. If, for example, incumbents are required to submit details on actual speeds delivered to make their case, there’ll probably be few challenges. Incumbents don’t want it proven in such a public fashion just how big the gap is between what’s advertised and what’s delivered. Can you imagine the kind of fallout that would generate?

Fourth, you can run a preemptive counter-challenge in thi fishbowl. Anyone can post a challenge on the Web site. But that means anyone can post a note saying “I live here and let me tell you how bad coverage really is.”

So what you do is round up a whole passel of people around computer in the libraries, community centers, the schools, and get their comments. Be sure they submit enough of the right information, such as address, who the incumbent is, etc. so their comments carry weight.

What can we expect?

In the end, everything comes down to how detail-y is NTIA/RUS’ definition of “substantiation.” I think any mid-sized incumbent will be hard pressed to respond if they have to do a lot of legwork in a short period of time (2 or 3 weeks) because they don’t have a lot of staff.

For the bigger ones, such as Verizon and AT&T, a lot depends on the specific requirements for making a challenge. Remember, these folks didn’t apply in the first place because they don’t want to open their kimonos for public inspection.

Another factor is whether or not the applicant can rebut the challenge. With the amount of work a lot of applicants have presented to make their case for an area not being served, incumbents have to realize they’re at a disadvantage. I think incumbents would fear the publicity of losing a public counter challenge, so in this case there would be few challenges.

On the flip side, if these public statements from NTIA about requiring lots of substantial are mostly posturing, and the eventual required data to make a challenge is minimal (i.e. presenting only advertised speeds), then all bets are off. Skimpy requirements will likely lead to lots of challenges. I’m banking on stronger.

Either way, your work is not yet done young warriors.

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