Free Press Calls on Congress and the FCC to 'Reimagine and Reinvent' Efforts to Bridge the Digital Divide

The US telecommunications market has significantly evolved since Congress last overhauled the Communications Act more than a quarter century ago. But the Federal Communication Commission’s universal service distribution policies – though periodically tweaked – are still rooted in a framework designed to support incumbent telephone companies. However, the Congress and the FCC now have before them an opportunity to reimagine and reinvent universal service policy for the future. We suggest that the first step for Congress and the FCC is more-specific and targeted analysis: The FCC should perform a stress test, to determine what market rates would be in the absence of any additional High Cost support. If the FCC determines that in the absence of ongoing subsidies, rates will not be reasonably comparable, it must probe why. If it is because rural carriers themselves have few options for affordable backhaul, the solutions to that problem could come in the form of regulation, or Congress appropriating additional middle mile infrastructure funding. If the answer is that rural internet service providers (ISP) remaining cost of capital cannot be recovered from reasonably comparable end-user rates (that account for differences in overall cost of living and wages), then the solution to that problem could come in the form of subsidies paid to end-users to offset their high bills. We urge Congress to make the Affordable Connectivity Program (ACP) a permanent program, and appropriate the funding needed to ensure that low-income households can afford broadband long after the initial appropriation from the Infrastructure Investment and Jobs Act (IIJA) is expended. Finally, we strongly urge Congress and the FCC to reject the cynical call from some of the nation’s largest businesses to massively lower their own Universal Service Fund (USF) contribution burdens by imposing a regressive tax on residential broadband services.