Posted by: Hank Hultquist on July 28, 2010 at 1:54 pm
My previous blog post examined how a wireless provider like AT&T mobility ended up getting money from the Federal Universal Service Fund (USF), and why AT&T continues to receive money from a fund which it has been urging the FCC to reform for years. In this blog, I take a closer look at the USF funding that AT&T receives for its wireline operations in rural and high cost areas.
As I mentioned last time, AT&T’s USF receipts are split about 50/50 between its mobility business and its traditional wireline local phone business. And, on the wireline side, well over half of the money AT&T receives is for just two of the twenty-two states where AT&T provides traditional wireline phone service – Mississippi and Alabama. (You can get all the gory details here.)
If that seems odd to you, be assured that you’re not alone. In fact, you’re in the good company of the U.S. Court of Appeals for the 10th Circuit, which has twice told the FCC to fix the program that creates this situation. The FCC in turn has made no changes to this program, but has most recently told the court that the program is in fact serving the policies set out by Congress, and, by the way, the FCC plans to phase the program out entirely as it transitions universal service support to broadband.
