Quality of life challenges presented by the COVID-19 pandemic emphasized the importance of making access to voice and broadband data services widespread and affordable. The virus forced nearly everyone to shelter in place and to rely on wired and wireless technologies for remote access to education, telehealth, government services, social networks, ecommerce, entertainment, and communications.

During the COVID-19 pandemic, many rural locales in the United States (“U.S.”) had no terrestrial broadband option or lacked a critical mass of residents with sufficient discretionary income and digital literacy skills. Service providers, as well as federal, state, and local government agencies, achieved significant progress in bridging this “Digital Divide,” thanks to generous grants, subsidies, and loan guarantees. Additionally, during the pandemic, Congress acted with uncharacteristic speed and allocated billions of dollars to make voice and data services more accessible, with much of the funding quickly available as one-time monetary transfers. While there was considerable success in combatting the Digital Divide during the COVID-19 pandemic, unfortunately, few legislators, regulators, and policy makers have considered what to do after the pandemic when emergency funding programs wind down.

This Article assesses post-pandemic universal service sustainability issues arising when both service providers and subscribers must bear a higher percentage of ongoing operational expenses and necessary investments in network upgrades. Even before the onset of the COVID-19 pandemic, existing universal service funding programs risked unsustainability because of the growing subsidy burden. Much of this growth was largely due to government decisions specifying new beneficiaries and mandating subsidies for both basic voice and enhanced data service, such as high-speed broadband access to the internet. Additionally, existing law imposed a hefty monthly Universal Service Fund (“USF”) contribution burden on carriers generating revenues from voice services, which the telephone companies could lawfully pass onto subscribers with inclusion of a billing line item. Because ventures providing data services qualified for a subsidy burden exemption, customers of “plain old telephone services” largely bear a growing financial burden that many consider unfair and burdensome.

This Article identifies how Congress, the federal Executive Branch, state and local governments, and carriers can forestall likely, measurable declines in broadband geographical penetration and subscription rates achieved during the COVID-19 pandemic. The Article specifies reforms needed to make ongoing universal service subsidy programs sustainable and more effective in achieving additional progress in bridging the Digital Divide as emergency grant programs wind down.

Author: Rob Frieden


Volume 25, Issue 1