INCOMPAS: ISPs Need to Pay Into USF

A stack of money
(Image credit: ATU Images/Getty Images)

INCOMPAS says one of the keys to saving the FCC's Universal Service Fund subsidy program is to make internet service providers (ISPs) pay into it.

Currently the fees to support the multi-billion-dollar program to get advanced communications services to low-income and rural residents, as well as schools and libraries, come from dwindling voice and telecom service rather than broadband network providers.

As the FCC ponders ways to shore up the fund as it prepares a mandatory report to Congress due August 12, INCOMPAS, which represents streaming, communications and technology companies, has issued a fact sheet to help make its case.

INCOMPAS points out that revenue from telecom USF supporters has fallen precipitously -- from $68.1 billion in 2004 to $29.1 billion in 2021 -- causing the USF fee, which is passed on to customers, to rise to 33% and likely to 40% soon.

Also: Could the FCC Make Video Streamers Pay Into the Universal Service Fund?

INCOMPAS deals with the issue of why USF needs to be saved if Congress is separately putting tens of billions into broadband buildouts through various programs, including the massive infrastructure legislation.

The group says that one issue is that most of that money is going to deployment rather than affordability programs like the USF subsidies to low-income residents. "It is unlikely that Congress’ funding will meet all the ongoing needs that the USF supports," it says.

"The facts are clear when it comes to USF, delay is not an option," said Angie Kronenberg, chief advocate and general counsel for INCOMPAS. "Evolving USF so that its revenue base of support includes broadband internet access services is an immediate, common-sense solution that provides a sustainable long-term solution for the program."

Congress has been kicking the tires on legislation (the Funding Affordable Internet with Reliable Contributions [FAIR Contributions] Act) that would require the FCC to study the feasibility of extending the fee to ISPs, but also to streamers and other edge providers. Sen. Roger Wicker (R-Miss.), who authored the bill, has said both ISPs and the edge providers were included because: "These companies have benefited from the connectivity the USF supports but have not yet had to contribute." ■

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.