Universal Service: How Much Is Enough?

摘要

The Telecommunications Act of 1996 dramatically altered the regulatory environment of the telecommunications industry. The purpose of the act was to exchange regulatory pricing principles for market prices. Regulators would no longer establish just and reasonable rates for retail customers. Instead, they would promote competition and reduce regulation. The competitive marketplace would ensure lower prices, higher quality services, and the rapid deployment of new technologies. Conventional wisdom held that pressure from the newly released market forces would destroy existing cross subsidies among ratepayers that supported universal service prior to the passage of the act (FCC 1999, 10). Anticipating these events, the act expanded the Federal Communications Commission's role in preserving and advancing universal service. The act required the Universal Service fund to be explicit and sufficient. Since the passage of the act, the FCC has significantly increased universal service funding. (See table 1.) However, it is still not clear if the current funding is sufficient. The purpose of this paper is to review the definition of sufficiency and to use the definition to determine sufficient expenditure levels. Three dimensions of sufficiency will be addressed. First, programs associated with ensuring that households can afford telephone service will be investigated. Second, the types of services that are supported will be examined. Finally, the funding for large carriers serving rural and high-cost areas will be reviewed.