Free Press: We'll Work to Hold FCC Chairman to USF Promise

On Thursday, Federal Communications Commission Chairman Julius Genachowski announced his proposal to revamp the Universal Service Fund. The Chairman's announcement follows the Commission's requests for comments on the "ABC plan," a purported compromise put forward by incumbent phone providers. That proposal and related plans would allow both rural and urban carriers to dramatically raise rates on their customers in the guise of promoting broadband deployment and adoption -- a worthy goal, but one this plan doesn't achieve. In other words, the carriers have proposed they be allowed to receive rate-payer subsidies to offer a monopoly service, without any constraints or obligations after receiving the payments.

In his statement Thursday, Genachowski said the FCC "will not rubber-stamp or adopt wholesale the proposals of any stakeholder or group of stakeholders," a pledge Free Press intends to hold him to.

Free Press Policy Director Matt Wood made the following statement:

"The framework first put forth by the incumbent telephone companies is absurd. We are glad to learn that the FCC does not intend to adopt this framework in whole, but are waiting for more details about which pieces it will adopt. The companies' plan has very little to do with increasing broadband adoption, and everything to do with allowing monopoly local phone providers to reach further into the pockets of consumers. The FCC cannot give Verizon and AT&T -- two companies that have collectively shed more than 200,000 jobs over the last decade -- a green light to raise consumer bills to pad their profits even further.

"The industry-authored framework seeks a regulatory rubber stamp for a tremendous rip-off, based on unproven and unverifiable promises about eventual customer benefits. If enacted in anything resembling its current form, it would substantially raise phone bills for tens of millions of consumers while transferring billions of dollars to the largest telecom providers. It would not do nearly enough to promote broadband deployment and adoption, and would improperly balance this 'reform' on the backs of the poor and elderly. People living on fixed incomes or without jobs can hardly afford the nearly 20-percent increase in the cost of basic local service that the industry has proposed for FCC approval.

"We hope that Chairman Genachowski is sincere in his pledge to give the American people something better than the industry's profit-padding wishlist. But knowing how doggedly these companies pursue what they want, no matter how much it harms the public, we're going to be vigilant and make sure that the Commission abides by that promise."