I sent this email to Kevin Martin and each of the FCC commissioners last year:
Your recent decisions to exempt DSL providers from contributing to the Universal Service Fund, and your decision to require Internet-based providers of phone service to contribute as well, seem to indicate that you believe Universal Service should apply only to phone service, and not to access to the Internet. You are passing up an historical opportunity to do something about the "digital divide," whereby low-income households cannot afford Internet access.
The universal access promise should be made for broadband Internet access, and ALL the applications that run over it. This means infrastructure providers of broadband Internet access (often the same companies that now provide phone service) should collect and apply broadband USF fees.
By transferring the telephony universal access scheme to Internet access in general, you take a big step toward ending the digital divide, and avoid singling out a single service (voice) that will soon be much like email in the way it is used and marketed. Taxing a specific application (voice) rather than the infrastructure across which all applications run is extremely misguided.
Similarly, taxing individual phone numbers would be akin to taxing email addresses. This will create an unnatural distortion in the economics of new phone applications and will stifle innovation. It's adds unnecessary complexity and is very bad idea.
The best and simplest way, bar none, to solve the Universal Service Fund issue is to apply the fee to broadband Internet access in general (e.g. DSL or cable modem), NOT to single out particular services that run over broadband. Phone service, as VoIP, is simply a software-based service running over broadband, just like email, e-commerce or any other internet application. To single out voice will create a distorting imbalance in the FCC's regulatory approach to the Internet.
The new mantra at the FCC should be Internet access for all. This will include phone service AND all the other applications that run on the Internet. That means collecting USF fees from the providers of Internet access. Its the simplest, cleanest regulatory approach available, and will provide plenty of money for the fund.
I didn't get a reponse - I didn't expect to. But as a result of letting big ISPs off the hook from contributing to the USF, it is running out of money. Unbelieveably, the FCC is trying to make up the gap by placing tax and regulatory burdens on VoIP providers. Its no joke that Kevin Martin appears beholden to the big carriers. He even joked about himself, as reported by techdirt here.
The government’s light touch regulating the internet has allowed it to flourish, creating thousands of jobs, entire new industries, and countless other benefits to society (and a few evils, granted). The FCC’s approach to VoIP has been the exact opposite. Perhaps people didn’t take the Internet seriously at first, so the special interests didn’t rally, where in the case of VoIP, you are treading on the turf of giants with years of lobbying experience. The result has been a focused lobbying assault to which Kevin Martin has responded like a true politician. The price has been wrong-headed FCC policy that is stifling innovation and doing nothing to address the digital divide.