USF stakeholders may see fund cuts

As the FCC works to overhaul the Universal Service Fund, some changes could have important consequences for a number of rural carriers. The 11-year-old program to fund rural telecom services deployment is expected to cost $7 billion this year, up from about $5 billion in 2002. The FCC has said those numbers must come down. It is now collecting comments on some preliminary proposals, including “reverse auctions” for funds and the creation of three separate funds: one for broadband, one for wireless and one for last-resort service. No doubt the carriers themselves will have some input to offer, given their stake in the system.