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In the six plus years I have been associated with this industry I have
noticed on thing that can always be counted on. With the possible
exception of spam, ISPs/WISPs will have differing opinions on just
about everything from which email software to use to whether to support
MuniWireless projects.
Here
is one of the few issues we can all uniformly agree on, the Universal
Service Fund. There seems to be one uniform feeling by everyone in this
industry towards this money grab, we all despise it and want it dead.
Today, I find the FCC is finally going to take a hard look at this in an Open Commission Meeting on Thursday, May 19th,
apparently not realizing that the latest Star Wars episode will be
opening that day and most of America will be taking the day off!
All
kidding aside, this is a very serious subject, one that every single
one of us needs to become deeply involved with. For years it has been
suspected that the Universal Service Fund was being used to "cross
support" DSL in effect using all of our money to compete against us.
My
wife and I attended a Vermont Public Service Board meeting a couple of
years ago where a Verizon representative candidly admitted that Verizon
sells DSL at well below their cost. Why,
in the name of everything that is holy in business would any business
sell a product or service at below a company's real cost? In the
semiconductor business or the steel industry this type of behavior is
considered "dumping" and would usually lead to sanctions against any
company found guilty of engaging in such action. Yet the ILECs are
given a free pass.
There have even been well documented cases
of the ILEC selling DSL to the end user at a lower rate than the sell
it to CLECs at wholesale! Why is this? We can only assume that the
powers that be are so convinced that broadband is important that they
are willing to overlook not only bad business practices but also what
could be construed as illegal behavior. I would submit that this is
very short-sighted thinking at the best. If this type of
anti-competitive business practice is allowed the net result is that
independent businesses that would normally provide competition will not
be able to get a foothold and we all lose in the long run.
Great, thank God they're on our side!
What
would happen if the Universal Service Fund was withdrawn? Can we
predict the real effect this might have on the telecommunications
industry? We can certainly draw the conclusion that the lose of this
kind of revenue would have a direct effect on their business model, one
that would have some pretty far reaching consequences.
How will
this affect Verizon's deployment of fiber (Fios) or SBC's deployment of
VDSL? What does this mean for rural telephone service in many places
where there are simply not enough customers per mile to provide service
profitably? What kind of financing mechanism would we need to put in
place where we can still supply telephone service in places like
Victory, Vermont even though the residents there will never even begin
to pay for the cost of maintaining the infrastructure that carries
service to them? Now something needs to be said that in order for
someone from elsewhere in the country to be able to call Victory,
Vermont (hey, it could happen)
the network must reach there but is the entire country willing to pay
the extra money to supply service to the hundreds of thousands of
locations that need to be subsidized in order to get service?
One
thing that comes to mind is that the ILECs will have to make some
really tough choices in order to continue with their plans if the USF
gets discontinued. The first thing they would have to do is stop
selling services (any services) at below their cost. This means the
retail price of DSL will climb to where the competition has set the
price point at. Cool, free enterprise and market competition can now
move forward as they were meant to.
As to Verizon's plans to
roll out fiber or the rest of the ILEC's plans to "modernize" their
network infrastructure the cost would have to now be carried by the
revenue they earn - just like everybody else. They could now court
investors, present a solid business plan and convince the potential
investors that they have a sound (not to mention) profitable strategy,
one that an investor should feel comfortable investing their money in.
Considering how well they have been able to do this in the past leads
me to think they might have a little problem convincing anyone to
believe them - but that's me, I'm cynical.
Could this be one
of the first solid indications of the course Commissioner Martin plans
to steer the FCC? Is it possible that we might finally be seeing the
FCC adopt the Fast Fail policy? Are we finally seeing a dawning of an
era where the telecommunications industry is finally going to be
allowed to have real competition?
I don't know.
I do know
that if every single one of the people I have heard bitch about the USF
write one letter, makes a single telephone call or sends one email the
FCC just might get the message how much we all feel the USF is nothing
short a menace.
One more thing I know, the FCC isn't some
nameless, faceless government agency, they are a group of people who
have repeatedly reached out to us in an attempt to get feedback from
us. It is our responsibility to provide that feedback or they will
never understand how we feel.
You said you wanted change. You
said you wanted the USF to be discontinued. This is your chance, your
big chance to get what you said you wanted. But, like everything else
in this world, you must work to get what you want.
Here's a list of email addresses for you to write to:
Chairman Kevin J. Martin:
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Commissioner Kathleen Q. Abernathy:
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Commissioner Michael J. Copps:
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Commissioner Jonathan S. Adelstein:
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Here is the FCC's mailing address for those of you who prefer the US Postal system:
Federal Communications Commission 445 12th Street, SW Washington, DC 20554
Here's the FCC's 800 number: 1-888-225-5322
And here's a piece of advice - take a few minutes out of your busy day and DO SOMETHING!
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