Pursuant to the American Recovery and Reinvestment Act of 2009, commonly known as the stimulus package, Congress required the Federal Communications Commission (“FCC” or “Commission”) to develop a National Broadband Plan to ensure that all Americans have access to high-speed Internet services. The FCC must deliver its Plan to Congress by March 16, 2010. In anticipation of the release of its proposal, on March 5, 2010, the FCC announced its plan to transition the Universal Service Fund (“USF”), which currently supports universal access to basic telephone service, to universal broadband support.
The FCC proposes to complete the transition in three stages, with the goal of connecting 99% of Americans by 2020. First, the FCC will create two separate revenue-neutral funds- the “Connect America” fund and a mobility fund. The Commission intends to shift the high-cost portion of the USF into the Connect America fund, a technology-neutral support mechanism, attempting to end voice-only service support by 2020. The mobility fund will extend support to mobile services generally, with a focus on 3G coverage.
In connection with the Plan, the Commission will propose intercarrier compensation reform. Although the FCC plans to maintain the current size of the USF, it will request a one-time $9 billion government contribution to facilitate the transition. The Plan will include several options to fund the proposal.
The FCC‘s National Broadband Plan could potentially overhaul the entire USF if approved by Congress. Specific details are not yet available. Clients should carefully review this advisory and the Plan, expected to be released on March 16th. Clients are encouraged to contact the firm for further guidance once the Plan has been issued.
Questions about this Advisory or the FCC‘s National Broadband Plan may be directed to Jonathan S. Marashlian at email@example.com or (703) 714-1313.