Title II: A new way to collect fees on broadband

[Commentary] If broadband is classified as a telecommunications service, a number of fees could apply to consumers’ broadband Internet bills.

These would most likely be the Federal Universal Connectivity Fee, the Telecommunications Relay, and the Carrier Universal Service Charge. At current rates these fees would likely amount to $17 in federal charges per household annually, according to a study by the Progressive Policy Institute (PPI). Uncertain, but far more significant to consumers, are fees at the state and local levels. Title II does not create new fees immediately. In the long term, however, it could grant many state legislature, utilities commissions, and municipalities unprecedented authority to collect fees on broadband subscriptions. As the number of landline telephone users decline, classifying broadband under Title II offers an irresistible opportunity to collect fees on a new service. While the FCC and the president purportedly seek to make the Internet “open” and “free,” Title II may actually yield an Internet that is “opaque” and “costly.” It may be the case that Americans support their money being used to subsidize broadband access. The FCC should be forthright, however, in publicizing just how much such an effort will cost.

[Roslyn Layton studies Internet economics at the Center for Communication, Media, and Information Technologies at Aalborg University in Copenhagen, Denmark]