Internet service providers are once again advocating for the Federal Communications Commission (FCC) to impose new fees on Big Tech companies in an attempt to subsidize broadband network deployment and affordability programs. The proposal, made by USTelecom—a lobby group representing AT&T, Verizon, CenturyLink/Lumen, and smaller telcos—suggests that Big Tech firms should contribute to the FCC’s Universal Service Fund (USF). This fund, which allocates resources to broadband providers, is currently funded by contributions from phone companies, who generally pass these costs onto consumers.
The call for these new fees comes in the wake of the recent discontinuation of a broadband discount program, an event that USTelecom argues necessitates action from the FCC. More information can be found in USTelecom’s FCC filing.
USTelecom maintains that focusing on Big Tech firms, which benefit significantly from broadband connectivity, would help fairly distribute the financial burden of sustaining the USF. The USF, which disburses approximately $8 billion annually, funds several initiatives including the Connect America Fund and the Rural Digital Opportunity Fund, both of which support network construction in underserved areas. Additionally, it finances the Lifeline program, which offers discounted services to low-income individuals.
According to FCC Chairwoman Jessica Rosenworcel, there are currently no plans to expand USF contributions to include Big Tech. She has previously rejected calls to impose Universal Service fees on broadband services, leaving telephone services as the sole revenue source for the USF.
The request from USTelecom was submitted in response to the FCC’s recent call for comments on its latest analysis of competition in the communications marketplace. USTelecom contends that the USF is crucial for maintaining a competitive environment and that an expanded contributions base is necessary for its long-term sustainability. Further comments from USTelecom can be found in the FCC’s request for input.
Supporters of expanding the USF argue it could revive the recently lapsed Affordable Connectivity Program (ACP), which provided $30 monthly discounts to low-income broadband users. USTelecom posits that including Big Tech companies in the USF contribution base could enable the ACP to become a permanent fixture, further details available here.
In related news, the U.S. Supreme Court recently declined to hear a challenge to the USF’s legality brought by the conservative group Consumers’ Research, reinforcing the existing mechanism of the fund’s revenue collection.