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Reforming funding of universal access to telecommunications and broadband services: Approaches for the new decade

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  • Glass, Victor
  • Tardiff, Timothy

Abstract

The FCC universal service support fund's revenue base has been shrinking while the payouts have risen. As a result, the contribution factor, an ad valorem tax on the revenue base, rose from 16.7% in 2017 to 21.2% in 2020. We propose two solutions to the funding problem: A near-term funding reform proposal that widens the revenue base by replacing the current definition of assessable services (interstate and international) with a more inclusive definition of all communication services that have a telecommunications component. A longer-term strategy is to expand the revenue base to include basic utility network revenues. This proposal assumes that it is cost effective to develop one physical broadband network (landline and wireless) in high-cost areas and use the latest software-defined technologies to allow utilities to either split the physical network's functionalities into independent or cooperative virtual networks.

Suggested Citation

  • Glass, Victor & Tardiff, Timothy, 2021. "Reforming funding of universal access to telecommunications and broadband services: Approaches for the new decade," Telecommunications Policy, Elsevier, vol. 45(2).
    • Handle: RePEc:eee:telpol:v:45:y:2021:i:2:s0308596120301294
    DOI: 10.1016/j.telpol.2020.102037
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    References listed on IDEAS

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    1. Glass, Victor & Tardiff, Timothy, 2019. "The Federal Communications Commission's rural infrastructure auction: What is hidden in the weeds?," Telecommunications Policy, Elsevier, vol. 43(8), pages 1-1.
    2. Jeffrey T. Macher & John W. Mayo & Olga Ukhaneva & Glenn A. Woroch, 2017. "From universal service to universal connectivity," Journal of Regulatory Economics, Springer, vol. 52(1), pages 77-104, August.
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    Cited by:

    1. Oughton, Edward J. & Comini, Niccolò & Foster, Vivien & Hall, Jim W., 2022. "Policy choices can help keep 4G and 5G universal broadband affordable," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    2. Xia, Jun, 2022. "Juggling ecumenical wisdoms and xenophobic institutions: Framing and modelling China's telecommunications universal service and rural digitalization initiatives and policies," Telecommunications Policy, Elsevier, vol. 46(2).
    3. King, Jesse & Gonzales, Amy L., 2023. "The influence of digital divide frames on legislative passage and partisan sponsorship: A content analysis of digital equity legislation in the U.S. from 1990 to 2020," Telecommunications Policy, Elsevier, vol. 47(7).
    4. Edward J. Oughton & Ashutosh Jha, 2021. "Supportive 5G Infrastructure Policies are Essential for Universal 6G: Assessment using an Open-source Techno-economic Simulation Model utilizing Remote Sensing," Papers 2102.08086, arXiv.org, revised Jun 2021.

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