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FCC Chairman Julius Genachowski  (Source: LA Times)
Funding redirection could bring high-speed access to new areas of the country

The Universal Services Fund (USF) was an initiative put in place by former U.S. President Bill Clinton's Federal Communication Commission in 1997.  The USF takes a large cut out of consumer phone bills -- approximately 15 percent out of a long-distance bill, for example -- and redirects that money to funding landline telephone service to low-income rural areas, and providing broadband at public institutions.

Over time the usefulness of landline phones has faded, but the FCC continues to pour money into that aspect of the effort.  In his bid to beef up our nation's broadband, U.S. President Barack Obama's appointed FCC Chairman, Julius Genachowski, is looking to scrap that funding and redirect it to promoting broadband in rural areas.

He proposed the change during a speech [PDF] at the Information Technology and Innovation Foundation.  He stated:

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. But while the world has changed around it, USF -- in too many ways -- has stood still, and even moved backwards.

Currently the landline fund eats up $4.3B USD a year, while the broadband fund only gets a chunk of the remaining money.  Chairman Genachowski suggests a gradual fadeout of the telephone funding, transitioning that money to a new broadband deployment and support fund designed to push broadband into rural areas.

The new fund, formally titled the Connect America Fund, would aim to cover 24 million Americans with broadband.  Chairman Genachoski complains that the USF is becoming outdated and needs the changes.  He states, "The fund pays almost $2,000 per month -- more than $20,000 a year -- for some households to have phone service. And in many places, the existing system funds four or more phone companies to serve the same area."

The speech came with the filing of a "Notice For Proposed Rule-Making" (NFPRM).  This is the FCC's way of giving the public chance to comment.

Wireless service providers like Verizon and rural broadband providers have expressed enthusiasm about the shift.  Thus far rural landline operators have kept quiet, but they're unlikely to appreciate the measure.



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I can understand the concept behind this...
By MrBlastman on 2/8/2011 1:23:54 PM , Rating: 0
If you think about it, it sounds good allowing everyone in America access to the internet, even those who live too far away from civilization to get it unless subsidized (as they'd never assumedly pay for it themselves in the way the government thinks is appropriate for them). If you allow everyone access, then everyone will have equal opportunities at the educational resources available online (anatomy for instance, it makes up a large chunk of them).

So, at face value, it sounds all nice and dandy--it is making America stronger.

Wait, did I just say America? America stands for freedom, and part of that freedom is a free-market society. The article states we have 15% of our long-distance fees go straight towards funding this four billion dollar project. We don't really get a choice about this, it is deducted and goes there like a tax. I, the individual working hard to pay my own mortgage, raise my new child and build a family, am paying part of my money so others can get internet access... Where is the freedom in that?

Likewise, arguing that this is still America, wouldn't free-market rules dictate that those in rural areas would, if it became necessary or desirable, investigate ways to procure internet or telephone on their own, free of Government intervention?

By allowing the Government to fund such activities, we are in turn HURTING America by stifling potential innovations that could be discovered if people were forced to figure them out on their own.

So, with that said, I have to say I think there are better ways Federal money is spent than on a program like this.




RE: I can understand the concept behind this...
By DanNeely on 2/8/2011 2:10:40 PM , Rating: 2
If the telecom companies weren't aggressively buying our state/federal governments to forbid municipal broadband from being deployed in areas that they don't feel are worth providing service your argument might be more credible.


By MrBlastman on 2/8/2011 3:57:31 PM , Rating: 2
So you're saying we should line all the lobbyists up in front of a firing squad? :)


By ebakke on 2/8/2011 6:31:44 PM , Rating: 2
What good is municipal broadband in a city where 15 people live in the city limits, and everyone else live 15 miles from "downtown" (read: the one street that drives by city hall). We're talking about rural areas here.


RE: I can understand the concept behind this...
By ebakke on 2/8/2011 6:36:33 PM , Rating: 2
I'm fine with governments existing, and doing things. My beef is with the Federal government doing all of them. Why do I, in MN, care about the Hoover Dam? Or roads outside of MN? Even if I travel, if the roads suck in WI, I just won't go back. I'll give you the Panama Canal, but only because other sovereign nations are involved.


By supermitsuba on 2/9/2011 11:37:08 AM , Rating: 2
that is one opinion out of millions who would disagree otherwise. There are reasons people live in those places. Who actually export stuff from their small city to the larger cities. And if broadband provides more economic opportunities to be in the sticks, then isnt that worth it enough? Gee something the government can do to spark the economy.


By wookie1 on 2/9/2011 11:07:18 AM , Rating: 1
" i would rather pay for this than inner city welfare. "

Once you allow the gov't to take your money, its not your choice anymore how it is spent. Sure, you can vote for different representatives, but it's unlikely that their spending priorities will agree with yours.

Of course, most people don't want to live in a lawless land with no governmental structure that is vulnerable to takeover from hostile forces, and we don't want people who are befelled with unfortunate occurrences to simply die of starvation. So, a government structure is needed in order for us to live in a civilized environment, but the burden and scope of government should be minimized so that each person on their own can determine what to spend their precious resources on.


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