The FCC’s Plan For Universal Broadband Could Be a Good Thing

Federal Communications Commission Chairman Julius Genachowski proposed a strategy last Thursday for revamping the government subsidy program for high-speed Internet.

Currently, telephone customers in the U.S. subsidize basic telephone services for rural communities. Genachowski is proposing focusing these funds on developing high-speed internet in underserved areas. He asserted that this plan would also be efficient and less burdensome on telephone customers.

The access gap between urban and rural households is a problem. According to Chairman Genachowski, the access gap results in “jobs not created, […] competitiveness not advanced." He sees the access gap either an opportunity to create jobs or a detriment to job creation.  That may or may not be.

A definite reason to address the gap is that it potentially prevents citizens from access to information. But does the government need to step in?

Currently, the FCC runs the Universal Service Fund, which subsidizes phone line development in rural areas.  Genachowski’s plan would gradually reorganize the program to directly support fixed and mobile broadband. The proposal would also examine costs passed on to the nation’s telephone customers used to fund the USF and basic telephone service in rural areas. His proposal does not require any new programs or greater funding.

The goal, according to Genachowski, is universal broadband.

Universal broadband, or high-speed internet, means access to the internet on every square foot of the country. "Broadband" is the use of wide range of frequencies for transmitting and receiving signals that allow access to the internet.

It seems clear that in most cases, the government does not need to provide access to broadband; we already have it. 95% of Americans live in housing units with access to broadband internet. So in order to engage the universal broadband, one has to assume that it refers to closing access gaps.

Chairman Genachowski’s plan attempts to address just that.

In general, proponents of government funded and mandated public internet believe that people will not have access to the internet without the government providing it. However, Genachowski explicitly acknowledges that he wants to foster private investment. It would be one thing to create a new government program. But making an existing program work more efficiently is good policy, if it works. The proposal to restructure the Universal Service Fund to increase high-speed internet access may actually be a great idea.