Looking ahead: Will Universal Service Fund reform finally happen?

The Universal Service Fund (USF) – which financially supports several of the Federal Communications Commission's high-cost and low-income broadband programs, at roughly $8 billion annually – has been going through a tough time. This past year saw the USF dragged before federal court in cases brought by a conservative public interest group questioning the fund's legality. The Fifth and Sixth Circuit courts initially ruled against the petitioners, but the Fifth Circuit then agreed to hear the case en banc in September and has yet to rule. Some expect that ruling to come in the first quarter of 2024. Even if the court were to uphold the USF as it is, reform is necessary for the program which relies on contributions via declining voice service revenues. Both the FCC and Congress have been studying the issue, and pressure is mounting for tech companies to contribute to the fund. Indeed, a new bipartisan bill introduced in the Senate in November 2023, dubbed the Lowering Broadband Costs for Consumers Act of 2023, would reform the USF and require the FCC to include broadband providers and "edge providers," or Big Tech companies, as contributors.