The Universal Service Reform Act of 2007 is much like the Universal Service Reform Act of 2006. Or the Universal Service Reform Act of 2005, for that matter. This week, House Energy and Commerce Committee Members Rick Boucher (D-Va.) and Lee Terry (R-Neb.) introduced the 2007 version, which would essentially require VOIP providers to pay into the Universal Service Fund.
The USF is one of those service charges that appears on your telecom bill each month. If you live in a major city, then the USF is a tax you're paying to help fund rural telecommunications providers, who have to build out more cable/DSL/optical trunks/cell towers to serve a far less dense customer population. If you live out in the boonies, however, it's a subsidy to help keep your telecommunications costs down.
Essentially, the bill would ask customers of VOIP providers, such as Vonage and SunRocket, to pay into the fund. On the other hand, the USF would be expanded to help push broadband out into rural areas as well. Obviously, KeepAmericaConnected.org, which is backed by rural telecoms companies, supports the bill.
Since I'm a member of the liberal media, I'm sort of forced into supporting this as well. All kidding aside, however, my wife's maid of honor currently lives in a farm deep in the wilds of Alabama, where many real-world commodities (food, shopping, gas, neighbors) are limited. Adding broadband won't change that. However, wiring a house with broadband also allows them to also participate in the global community, which I can't help but think is a good thing.
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April 27, 2007 3:29 PM
I happen to know someone who works at the Universal Service Administrative Company (USAC) and while this will naturally make more work for them, they'll definitely appreciate it. They're very proud of the work they do, even though they have to deal with high-energy lawyers from companies like Verizon and Comcast every day, and they have the pleasure of talking to the kinder CFOs of other ISPs and service providers at the same time. When I read a while back that Verizon was complaining about the USF, I had a few choice words for them:
http://www.gearsandwidgets.com/?p=221
May 1, 2007 9:57 AM
Why on earth should I pay for someone living (by their choice) in the middle of nowhere? I pay more for groceries in NYC, shouldn't they be giving me assistance???
May 1, 2007 5:10 PM
That's not a valid argument, Charles - are you suggesting that the millions of Americans who live in places without internet access simply get up and move to places that have it already? And that the government should make no move to provide schools, libraries, and other public institutions in remote areas with internet access either? Or that the government shouldn't encourage American competition and growth in telecommunications by providing incentives for telecomms to expand into those areas? Or that somehow the fact that someone lives somewhere they don't have cable or DSL is somehow their fault?
By that kind of logic, I should say that I don't live in NYC, so why should I pay into your homeland security programs? The USF, like any public collection of money for the civil good, is subject to debate, naturally, but the "I don't use it so why should I have to pay for it" argument stinks.
August 10, 2007 7:43 AM
The traditional phone companies are scared to death (literally) of the competition that VOIP provides, which is the REAL reason the Universal Service Reform Act of 2006 exists. They are trying to use the government to keep their uncompetitive businesses alive.
Universal Service taxes should be eliminated entirely. People that choose to live in sparsely populated areas should not be subsidized any more than insurance for people that choose to live below sea level. Their choice, their problem.
August 10, 2007 7:50 AM
Yes, Charles does have a valid argument, alan h. He's suggesting that internet access is not a right like you are suggesting, but that it's something people voluntarily buy in the marketplace. The marketplace for internet access should not be distorted and made more expensive for the majority of people because of the choice of some people to live in sparsely populated areas. Universal Services taxes DO NOT encourage growth in telecom. It's another regressive tax, pure and simple, that provides a subsidy for one group at the expense of another.