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Geoff Daily

App-Rising.com covers the development and adoption of broadband applications, the deployment of and need for broadband networks, and the demands placed on policy to adapt to the revolutionary opportunities made possible by the Internet.

App-Rising.com is written by Geoff Daily, a DC-based technology journalist, broadband activist, marketing consultant, and Internet entrepreneur.

App-Rising.com is supported in part by AT&T;, however all views and opinions expressed herein are solely my own.

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May 6, 2008 10:14 AM

USF: Behind the Times

The Universal Service Fund, or USF, was created by the FCC in 1997, is funded by a small charge telecommunications operators add to your bill, and has the intended purpose of increasing the availability and affordability of telecom services in rural areas and for low-income people.

The USF has come under heavy criticism in recent years as its payouts have skyrocketed--enough so that the FCC recently had to put a cap on it--and most all of its focus is still on subsidizing plain old telephone service.

For more about what USF was, is, and can be, check out this article.

The thing I wanted to add is how frustrating it is that we haven't been able to find a way to redirect the USF to focus on the deployment of broadband.

Now, this isn't a new idea, and the FCC has publicly stated its interest in working in that direction, but somehow we still don't have a solution for making it so.

Even more frustrating is that it's not like this is one of these issues where the incumbents are fighting any change. Everyone knows the USF is broken and needs fixing.

And it's not like we're still in a time where broadband is an unproven quantity with an uncertain future. Heck, a couple months ago the United State Telecommunications Association renamed itself the US Broadband Association, basically announcing that the future is in broadband not plain old phone service.

In the article linked to above, they suggest setting a digital transition date for phone service like the upcoming digital broadcast TV transition, mandating the use of voice over IP through broadband instead of plain old phone service.

I think this is a brilliant idea. And I'd suggest that if I could snap my fingers and make anything happen in the telecom world, one of the first things I'd do is find a way to transition every plain old phone customer into a broadband and VoIP customer.

Imagine how that would impact penetration rates. We'd finally have a way to blow past the mark of 50% of households having broadband!

In fact, I'd recommend any major telephone company to look at doing the same. They're already losing phone customers at an extraordinary rate to cable VoIP service. So why sit around and let the wound continue to bleed when they could potentially plug the hole by eating the short-term cost of equipping everyone with DSL modems and pricing a package at less than the cost of selling DSL and VoIP separately?

I'm not suggesting this would be a painless transition, but it does seem like it will eventually be a necessary one.

But back to USF reform: the simple truth is that until everyone in this country can access affordable broadband at home, there's still work to be done. Ultimately plain old phone service is a 20th century technology. We are now living in the 21st century and need to be considering the effectiveness of government programs and infrastructural needs of our country in that light.

Ultimately, the best and only solution is broadband everywhere. If we want to be a great country, the time to decide "if" we should do something has passed, now we must move aggressively to figure out the how, what, and when.

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