WASHINGTON-Wireless carriers should pay more into the universal-service fund, said a consumer advocate.
“It is time for cellular and the Internet to bear their share of a ubiquitous network,” said Mark Cooper, research director for the Consumer Federation of America.
Cooper participated in a conference call sponsored by the New Millennium Research Council to tout the release of a new report that says that low-income consumers of long-distance could end up paying a disproportionate share of the funding for universal service if the Federal Communications Commission changes the way the USF is financed from a contribution method based on revenues to a connection-based charge.
The FCC is examining this issue because there is a concern that the USF could go bankrupt as long-distance revenues plummet. The universal-service fund is financed by interstate and international telecom revenues.
One reason long-distance revenues are shrinking is that buckets of minutes plans-where consumers pay one price for local and long-distance and offered almost exclusively by wireless carriers-have become increasingly popular. Consumers who have signed up for bucket plans from their mobile-phone carriers now use wireless for their long-distance calling rather than a long-distance provider.
Wireless carriers pay into the USF, and some recently have begun receiving subsidies for serving rural America.
Last year, the FCC increased the wireless safe harbor to 28.5 percent from 15 percent. This means that wireless carriers must either decide to pay a percentage of intrastate revenues-known as a contribution factor-set every quarter by a quasi-governmental organization known as the Universal Services Administrative Corp. or elect to pay 28.5 percent of all revenues.
Even Cooper acknowledged that it is becoming increasingly difficult to differentiate between local and long-distance revenues. “The cellular carriers have a difficulty differentiating what is local and what is long distance,” said Cooper. “Many carriers find it very attractive to bundle.”
Jeffrey Kramer, senior legislative representative in the Department of Federal Affairs for AARP, said it would be even better if the FCC would raise the safe harbor to capture more money from wireless. When the FCC was considering the safe harbor, some wireline entities advocated that the safe harbor be raised as high as 45 percent.
