Small telcos face uncertain future in post-PSTN world

The Federal Communications Commission's suggestion to possibly phase out the public switched telephone network (PSTN) in favor of an Internet protocol (IP)-based broadband network, followed by an endorsement from AT&T, has made some small telcos question whether there will be a role for them in tomorrow's telecom market.

Complicating matters are anticipated changes to the Universal Service program, on which many small telcos rely. A wide range of industry players have recommended that the Universal Service program be extended to cover broadband, but some have suggested that only one wireline carrier and one wireless carrier should be covered in any individual area. A large part of the nation's 800 small incumbent telcos relies on Universal Service, and those carriers are wondering: If all these changes come to pass, will they be anointed as the wireline broadband provider or not? And if not, is there a future for them at all?