The Federal Communications Commission (FCC) voted unanimously to reform its Universal Service Fund (USF), with an overhaul planned for its intercarrier compensation system. The watchdog said of the USF, ‘Those systems have been widely viewed as broken, and long overdue for reform. Efforts to expand high speed internet to rural America over the next six years will increase economic growth by $50 billion over that period, the FCCestimates. These reforms create a new Connect America fund with an annual budget of no more than $4.5 billion, which will extend broadband infrastructure to the millions of Americans who currently have no access to broadband. As a result, today’s action has the potential to be one of the biggest job creators in rural America in decades. The FCC estimates that approximately 500,000 jobs will be created over the next six years by expanding high speed internet access to over seven million Americans living in rural areas’.
The FCC also recognises the growing importance of mobile broadband, and intends to make it an independent universal service objective for the first time, with ‘dedicated support’ provided to Tribal [Native American] areas through a new ‘Mobility Fund’. Another key element of the Connect America scheme is a comprehensive reform of intercarrier compensation practices, which it is hoped will eliminate hidden costs in consumer bills, potentially providing consumer savings of $2.2 billion annually, in the form of lower prices and better value for money. Whilst the FCC has warned that, on average, some consumers may pay an additional $0.10 to $0.15 per month on their bills, it claims that, for every dollar in cost, reform will provide$3 in benefits for consumers. No additional charges will be imposed on consumer phone bills that are at or above $30 a month.
