FCC proposes changes to rural subsidy program



JEREMY HOBSON: To Washington now where the Federal Communications Commission will likely vote today on something that affects every American's phone bill. There's a little fee on your bill that pays for phone service in rural parts of the country. Now, the FCC is thinking about using that money to pay for high speed internet access in rural areas instead.

Marketplace's David Gura reports.

DAVID GURA: When Congress started the Universal Service Fund almost fifteen years ago we were using Prodigy and dial-up modems. To order clothes, we opened a mail order catalog and called an 800-number. And that's why supporters say guaranteed landlines aren't as important to isolated Americans as high-speed Internet access.

MICHAEL ROMANO: There's a real value to the entirety of the country being able to have significant, substantial, meaningful broadband connectivity.

Michael Romano is with the National Telecommunications Cooperative Association, a group that represents hundreds of small communications companies. He says they'd applaud a vote to reform the fund. Reallocating resources, from landlines to broadband. But Romano doesn't want the government to lose sight of why the fund got started in the first place.

ROMANO: We would like something that recognizes the fact that operating in rural areas is high-cost.

In some corners of the country, it can cost up to $20,000 to get a house online.

In Washington, I'm David Gura, for Marketplace.

About the author

David Gura is a senior reporter for Marketplace, based in the Washington, D.C. bureau.


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