FCC demands USF overhaul; existing programme ‘poorly suited for 21st century’

9 Feb 2011

US telecoms regulator, the Federal Communications Commission (FCC), will vote to overhaul its existing USD8 billion universal service fund (USF) this week, heralding a shift in focus from wireline to broadband services. FCC Chairman Julius Genachowski commented: ‘In the 21st century, high-speed internet, not telephone, is our essential communications platform, and Americans are using wired and wireless networks to access it. However, it is still designed to support traditional telephone services. It’s a 20th century programme, poorly suited for the challenges of a 21st century world. At the end of this transition, we would no longer subsidise telephone networks; instead we would support broadband’.

It is believed that the FCC’s new USF proposal advocates: the elimination of waste and inefficiency; the use of savings to spur investment in high-speed internet in un-served areas; the stimulation of investment in broadband by reforming the ‘Intercarrier Compensation’ system; and an increase in accountability for both USF recipients and government officials, as a way of effectively measuring the performance of the USF itself. Genachowski has admitted that current rules intended to encourage new investment actually end up rewarding companies that lose customers, describing the current system ‘unsustainable’. The USF is a public-private fund intended to provide telecoms services to all American citizens.

United States, Federal Communications Commission (FCC)