Digital Beat

Preserving and Advancing Universal Service

The U.S. Senate's Universal Service Fund (USF) Working Group invited public comment on the future of the USF. I'm taking this opportunity to share my thoughts on one of the most important tools in our national effort to reach truly universal broadband.

People rely on both wireline and wireless broadband services

Address Fixed and Mobile in the Definition of Universal Service

As what we can do with the internet has expanded, so too has the way we connect, and how we use it—at home and on the go. In the United States today, it has become the norm for a majority of households to have two types of subscriptions to the internet—mobile data for their phone and fixed (and for the most part) wireline service for their residence. Over 75 percent of households whose annual incomes exceed $50,000 have cellular data and wireline broadband subscriptions. For households below that level, 44.7 percent have both types of subscription plans. The story is more pronounced at either end of the income spectrum. At upper-income levels—homes whose annual incomes exceed $150,000—85.1 percent had both wireline and cellular data subscriptions. Among households whose annual incomes are $25,000 or lower, the figure is less than half that—36.3 percent.

In addition, according to the Pew Research Center, 85 percent of American adults have a smartphone. And smartphone access directly compliments wireline broadband subscriptions at home for most Americans. The norm for internet access is using cellular access when outside of the home, but using Wi-Fi at home off of a wireline subscription for many data-intensive applications, thereby conserving data allotments in mobile broadband plans for use on-the-go.

Clearly, given sufficient income, households rely on both wireline and wireless broadband services. They often are not substitutes but a part of a continuum of connectivity that consumers rely upon throughout their daily lives.

Update the Definition of Advanced Telecommunications Capability

In the Telecommunications Act of 1996, Congress defined “universal service” as an evolving level of services. To continue to evolve service levels and ensure the goals of Section 254 are being fully met and implemented as Congress intended, the Federal Communications Commission (FCC) should take a fresh, holistic approach as to what constitutes “advanced telecommunications capability.” And the FCC should use updated threshold speeds in its next evaluation of advanced telecommunications capability availability.

The FCC last updated the speed requirements for advanced telecommunications capability in January 2015. Consistent with its 2015 Broadband Progress Report, the FCC should adopt an approach that is designed to place America at the forefront of broadband offerings and ensure that all Americans, wherever they live, have access to the extensive and ever-expanding offerings available today or on the near horizon. As the FCC found, Congress never intended the Commission to take a conservative view of what constitutes advanced telecommunications capability. Moreover, it is reasonable to conclude that Congress used the term “advanced” quite intentionally. The FCC should evaluate the availability of broadband networks that permit consumers to originate and receive highly developed or progressive services, rather than limit its assessment to the most common or basic capabilities that exist today.

Moreover, the FCC can do more than simply raise the broadband speeds threshold for 2021; it can and should adopt a methodology to continually set the threshold to mirror market realities. Modeled on the Consumer Price Index and other Federal support mechanisms, the FCC should continuously reset benchmarks, based on the broadband speeds that consumers access(1) to ensure that consumers in all regions and all people of the nation—including low-income consumers and those in rural, insular, and high-cost areas—have access to telecommunications and information services, including advanced telecommunications and information services, that are reasonably comparable to those services provided in urban areas and that are available at rates that are reasonably comparable to rates charged for similar services in urban areas.

In the Infrastructure Investment and Jobs Act, Congress offers new speed thresholds, defining as an “underserved location” any location that lacks access to reliable broadband service offered with a speed of not less than 100 megabits per second for downloads and 20 megabits per second for uploads, and a latency sufficient to support real-time, interactive applications. The FCC’s definition of advanced telecommunications capability can no longer include what Congress has deemed underserved.

In short, Congress should call upon the FCC to update its outdated definition, continue to ensure U.S. leadership in broadband speeds, and ensure that the nation never adheres to outdated speed benchmarks.

More specifically, the FCC should consider the types of service packages that people actually subscribe to when they are available. Nearly 32 percent of broadband subscribers have 1 Gbps service, an amount that doubled over the previous year. As of this year, nearly 90 percent of broadband-subscribing households have adopted services providing downloads of at least 100 Mbps.(2)

The need for greater broadband speeds reflects the growing, simultaneous, in-home uses of connected devices. As of 2021, the average U.S. household had a total of 25 connected devices, across 14 different categories (up from 11 in 2019), including laptops, tablets and smartphones; video streaming devices and smart TVs; wireless headphones and earbuds; gaming consoles and smart home devices; and fitness trackers and connected exercise machines.

The average household downloaded over 533 GB of data per month in the second quarter of 2023, up 9 percent from the average in the second quarter of 2022. Videoconferencing applications have also tested the limits of networks’ upload capacities. Internet monitoring company OpenVault found that average monthly upload usage increased 63 percent between the end of 2019 and the end of 2020, from 19 to 31 GB per month—and that number has risen to 36.1 GB in 2023. A growing number of upstream super-users have nearly reached the limits of certain networks; OpenVault noted that there have been “an increasing number of incidents in which upstream traffic exceeded 80% of node capacity,” requiring that network operators pinpoint bottlenecks and take action to improve upstream connectivity.

We are living in a world where the pandemic required us to move our lives online. Seemingly overnight, we had to learn how to do activities online that were previously performed overwhelmingly in person. With these new skills and a new environment in which participation in society is ever more reliant on broadband, change will certainly come to all manner of pursuits.

A New Measure of Affordability

The FCC should also revise its measure of affordability of broadband for low-income consumers. In the 2016 Lifeline Reform Order, the FCC found it does “not interpret and implement the concept of ‘affordability’ under sections 254(b)(1) and 254(i) by looking narrowly at whether and when a customer would not purchase a service at all but for discounts made possible, directly or indirectly, by universal service support.” Even though affordability is a “central touchstone” of Lifeline, the program’s resources should focus on “supporting those services that are otherwise unaffordable to consumers.”

As I noted in an earlier article, low-income Americans pay an out-sized portion of their income for telephone service.

With the Infrastructure Investment and Jobs Act’s massive $45 billion investment in broadband infrastructure deployment in unserved and underserved areas, Congress has made an important bet that one-time investments in scalable broadband infrastructure can reduce the burden placed on USF’s high-cost program. It means the FCC has an opportunity to refocus the USF high-cost program’s investments in capitol network construction into a reinvigorated effort focused on closing the affordability gap for those who may have access but cannot afford broadband service.

Notes:

Data that can be gleaned from sources like BroadbandNow (https://broadbandnow.com/research), Ookla’s Speedtest (https://www.speedtest.net/), Akamai Internet Speed Test (https://testmy.net/hoststats/akamai.com), and/or M-Lab's Speed Test (https://speed.measurementlab.net/#/) to name just a few potential sources.
“Broadband Insights Report (OVBI) 2Q23,” p. 7. Another 6 percent have services between 500 and 900 Mbps. (OVBI 2Q23)

For more of my thinking about the Importance of the Universal Service Fund see:

Adrianne B. Furniss is the Executive Director of the Benton Institute for Broadband & Society.

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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