Universal service, the idea that all Americans should have access to communications services, has been a core principle of the Federal Communications Commission (FCC) since its founding. This principle originated with the telephone in the early 20th century, but today’s consumers are abandoning plain old telephone service in droves. The great infrastructure challenge of the 21st century is universal broadband Internet service.
This challenge remains unmet in rural America. It’s been more than five years since the FCC issued a National Broadband Plan to ensure every American has access to broadband capability. Though broadband deployment has progressed rapidly in urban areas, it is not becoming available quickly enough in rural areas, where more than half of the population still lacks access to broadband infrastructure. It is becoming increasingly clear that the FCC’s universal service policies haven’t kept pace with the broadband revolution.
Yesterday, Commissioner Ajit Pai described how the FCC could help bridge the yawning digital divide between urban and rural America without increasing the existing budget for universal service funding.
His plan presents a surprisingly simple fix to an outdated FCC rule that ties universal service support for high cost areas to the provision of plain old telephone service. Small, rural network operators known as “rate of return” providers currently receive federal subsidies only if they supply plain old telephone service. This means rate of return providers lose funding if they choose to supply stand-alone broadband Internet service, but risk losing subscribers if they deny consumers that option. Eliminating this Hobson’s choice would give rural Americans more service options and encourage rural providers to invest in next-generation infrastructure.
The second part of the plan would allow rate of return providers to participate in the FCC’s Connect America Fund initiative to increase broadband access in rural communities. The FCC decided in 2011 that these providers would eventually receive funding from this initiative, but still hasn’t crafted rules governing their participation. Commissioner Pai believes there is now sufficient consensus for the FCC to move forward by the end of the year.
The FCC doesn’t face significant legal hurdles or substantial resistance in Congress either. A federal court has already upheld the FCC’s earlier decision to use universal service funding for broadband, and there is strong bipartisan support in the Senate and the House of Representatives for these reforms.
Commissioner Pai’s proposal wouldn’t solve all of the problems that have plagued universal service policy in the broadband era. But the enormity of the remaining tasks is no reason to delay targeted reforms that fall within the existing budget. Every day of debate about broader universal service issues is another day that rural Americans are denied access to next-generation broadband services.
The next six months ought to be enough time for the FCC to eliminate its outdated restriction on stand-alone broadband deployment in rural areas and adopt efficient rules for the participation of rate of return providers in the Connect America Fund. The plan might not be perfect, but it’s better than letting the perfect be the enemy of the good. The FCC should get this done, and get it done quickly.
