Originally published: August 12, 2010
Last updated: November 29, 2010 - 11:44am
Today's federal universal telephone service programs have numerous flaws, but its voice focus is not the main problem.
There are essentially three network components that the high-cost portion of the federal universal service program helps fund: the loop, switching and interstate common line costs. And the only one of these components that doesn't have a big role in supporting broadband data delivery is switching. switching costs have been declining as carriers migrate to less costly packet-based softswitches.
The upshot is that universal service funding under today's voice-focused program undoubtedly has been an important factor in helping U.S. telcos make broadband available to about 95% of US homes. And because most rural carriers already have deployed broadband, few of them are using Universal Service funding strictly for voice support. Engebretson doesn't mean to imply that the system isn't due for retooling. troubling issues include the fund's support for wireless carriers based on landline costs and its dependence on what many view as an irrational access charge system. That system has driven some competitive carriers to extreme measures to avoid paying access charges while at the same time enticing some of those carriers to even more extreme measures in an effort to collect those charges. Whatever Universal Service funding has been wasted undoubtedly relates more to those issues than to the voice-focused nature of the program.
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