The USF Needs Fixing but are these the Guys to do IT

Congressmen Rick Boucher (D-VA) Chairmen of the Subcommittee on Communications, Technology, and the Internet, and Lee Terry (R-NE) have introduced a bill to address the outdated priorities, contribution participants and recipients of the Universal Service Fund. As expected, the bill will add broadband to the mix of mandatory services for unserved markets.

According to the two congressional representatives, "The measure will expand who pays into the Fund, control the growth of the Fund and modernize the Fund by allowing its use for the deployment of high-speed broadband service."

Exactly what this means to ITSPs like Broadvox and the currently participating CLECs and ILECs is unknown. However, I always get a little bit suspicious when I see that AT&T, Verizon and Qwest endorse an effort. They never have the interest of a Broadvox as a priority. Rather, they see this as opportunity to expand their networks with the additional funding provided by a broader set of contributors.

Most of you understand that expanding broadband to unserved markets will provide Broadvox and other VoIP/SIP Trunking providers' access to new markets. At this time, the focus of Boucher and Terry is on rural markets, which will do little to grow our bottom line revenues. Previously, I pointed out that the US needs to expand its broadband offering in the served and underserved markets before spending billions on these rural deployments. We stand either last or next last among the G7 for broadband speeds and prices. We need to move up that list quickly to establish properly establish ourselves as leaders in IP communications.

The proposed bill will require the USF to support the build out of high-speed broadband infrastructure. However, it continues to look to the FCC to define "high speed". The current definition of 256K or better is inadequate. With the exploding array of application and services, such as movie downloads, video clip transfers, photo album sharing, music streaming, etc. we need to look at base speeds that are in the range of 5 Mbps and up. If that is established as the definition for "high speed", then the size of the underserved markets will expand several multiples. The new legislation should then include urban, suburban and rural areas as eligible for USF funding. That would make any new USF contributions by VoIP, WiMax and other broadband carriers more worthwhile.

Clearly, now is the time to comment to the FCC and Capital Hill on this effort to revise the USF and monitor the legislation closely.

See you on Monday with more thoughts and a new recipe.