Congress Likely to Consider How Broadband Service Relates to Universal Service

Michael Gallagher, administrator for the National Telecommunications and Information Administration, says NTIA “will be engaged with the leadership when Congress comes back on discussions [about the Universal Service Fund],” says NTIA spokesman Clyde Ensslin. Broadband service will be a part of those discussions, Gallagher says.

In 2002, the Federal-State Joint Board on Universal Service led by FCC Commissioner Kathleen Abernathy concluded that advanced and high-speed services do not meet the criteria for inclusion within the USF. In testimony before Congress last year, Abernathy said the joint board expressed the view that providing direct support for broadband services would place extraordinary financial burdens on consumers and threaten the viability of the USF.

Regulators say the fund already is under enormous strain, with an escalating number of competitors seeking access to federal subsidies in high-cost areas where local phone companies already provide service.

FCC Commissioner Michael Copps disagreed with the joint board’s conclusion that adding advanced services to the list of supported services within the USF would be contrary to public interest. “The evidence is all around us: advanced services become more and more essential with each passing day,” he said. “Broadband is a key and growing component of our nation’s systems of education, commerce, employment, health, government and entertainment.”

In its recommendation, the joint board noted that carriers can use federal subsidies in areas where it is expensive to provide phone service to fund a network capable of delivering both voice and high-speed Internet services, says Abernathy’s senior legal advisor Matt Brill.

Still, the 109th Congress is expected to debate whether the federal government is doing enough to help advance high-speed Internet access. Montana Sen. Conrad Burns is one lawmaker who is going to take part in the deliberations. Burns supports a separate mechanism to provide funding for broadband outside the USF — “something along the lines of tax incentives or loan programs,” says his spokeswoman Jennifer O’Shea.

Meanwhile, federal regulators say the country is closing the gap in making available broadband access for areas that are typically underserved such as rural communities. In a report released in September, the FCC said there were 28.2 million high-speed lines at the end of last year and only 6.8 percent of zip codes in the United States reported no high-speed lines, compared to 22.2 percent of zip codes with no reported lines in June 2001.

FCC commissioners Copps and Jonathan Adelstein, however, said the country is lagging behind many other countries in broadband.“We ... claim that broadband is available to everyone in a zip code if it is offered to only one person in that zip code,” Copps said. “This half-hearted effort at analyzing availability should be scrapped.”

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