The FCC www.fcc.gov voted 4-0 on the makeover of the Universal Service Fund, which helps provide phone service to rural America and to those with low incomes. Regulators approved the new Connect America Fund in a bid to boost U.S. broadband to rural America. The FCC also started a new Mobility Fund to build out mobile broadband.
"We are taking a system designed for the Alexander Graham Bell era of rotary telephones and modernizing it for the era of Steve Jobs and the Internet future he imagined," said FCC Chairman Julius Genachowski.
The changes mark the biggest transformation of telecommunications policy under the Obama administration.
Connect Americahttp://www.fcc.gov/connecting-america, part of the larger $8 billion fund, has an annual $4.5 billion for the next six years. Money for the plan will continue to flow from a surcharge to consumers and businesses seen on monthly phone bills. Those subsidies will be redirected to build out and operate new high-speed Internet in places that carriers consider too underpopulated or financially unrewarding for corporate investments.
The funding switch is expected to bring high-speed Internet to the 6% of the population that has been saddled with slow or no Internet and is losing ground economically and academically as high-speed Internet have-nots. "This is definitely a step forward," IDC analyst Matt Davis says. "It will go a long way toward solving the digital divide in the United States."
The move updates federal policies on financing of wired and wireless phone service, which is now available to more than 99% of the U.S. population, according to the FCC. But the wireless association CTIA said that aiming only 11% of the fund at mobile does "not appear to fully take into account the significant consumer migration to mobile broadband services."
Under the new plan, phone companies will be allowed to raise prices to recoup lost revenue. FCC officials say they expect average consumer phone bills could increase 10 cents to 15 cents per month.
The FCC also reworked its policy on how phone carriers pay for carrying and connecting each other's phone traffic. Critics of the system say the way that carriers paid for connecting calls outside of their service areas no longer made sense and had become riddled with perverse incentives and schemes that cost consumers.
The FCC estimates that expanding high-speed Internet will create roughly 500,000 jobs in six years.Administrator, KRVR.org firstname.lastname@example.org
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Earlier this month in Jeffersonville, Ind., I joined a coalition of companies called Jobs4America to announce the creation of 100,000 new call center jobs in the U.S. over the next two years, many from overseas.
This announcement would not have been possible without high-speed Internet, also called broadband. Thanks to new broadband infrastructure, companies are able to put call centers in communities they couldn't have just a few years ago.
Broadband is the indispensable infrastructure of our 21st century economy. Consider the call center business. It isn't just calls anymore; it involves e-mails, live-chats, social-network communications, and transaction processing — all of which require high-speed Internet connectivity.
Twenty percent of call center jobs in America today are at-home jobs, powered by broadband. The ability to work from home provides new employment options for returning veterans, people with disabilities, and parents who need flexible work schedules.
Bring home the jobs
The at-home opportunity creates a powerful win-win scenario, benefiting both employees and businesses. Returning a call center to the U.S. from overseas can save companies about 15%, according to a study by Novo 1.
Already, Jobs4America has announced 100 new jobs in Newark, N.J.; 300 new jobs in Holland, Mich.; and 4,000 new jobs in St. Lucie, Fla., where unemployment is 12.5%. According to a recent McKinsey study, the Internet creates 2.6 new jobs for every one job lost. In addition, a new report by the Phoenix Center shows that broadband users are less likely to become discouraged by lengthy job searches, and are consequently less likely to drop out of the labor market. These developments represent just the tip of the iceberg for how broadband can help revitalize communities and fuel job creation nationwide.
Blue Valley Meats, located in the tiny town of Diller, Neb., may not sound like a high-tech company, but broadband enabled this small business to sell beef online and increase revenues by 40% and more than double its workforce, even during the darkest days of the recession.
And because Danville, Va., has invested heavily in its broadband infrastructure, IKEA's first North American manufacturing plant and data center opened in what used to be a vacant mill.
Leading Internet companies aren't just creating jobs for engineers in our tech centers. They're also providing a virtual Main Street where millions of small businesses can sell their products. EBay and Amazon have created platforms for small businesses that support hundreds of thousands of jobs around the country. Groupon and LivingSocial, though each is less than three years old, have already created more than 10,000 street-level sales jobs across the country, helping small business efficiently market and grow their own businesses.
If you unplugged broadband, you would send all these workers home and deprive small businesses of a vital tool for success.
While smart strategies to promote broadband are paying off in positive trends in the broadband economy, we have more work to do. That's why I've made broadband expansion the top priority of the Federal Communications Commission.
The first critical element of the FCC's broadband agenda focuses on the connections that bring broadband directly into homes and businesses. It's unacceptable that more than 20 million people can't get broadband where they live, even if they want it. Not only do those people miss out on the at-home job opportunities we launched with Jobs4America, but they also lack access to new job listings altogether, which are moving almost exclusively online.
That's why the FCC is in the homestretch of a major overhaul of the Universal Service Fund, an important program that successfully connected Americans to basic telephone service in the 20th century. Now we must modernize this program to ensure that every American is connected to affordable, robust high-speed Internet in the 21st century, in a way that is fiscally responsible and insists on accountability.
The second critical element of the FCC's broadband agenda focuses on the airwaves that connect your smartphone or tablet to high-speed Internet. These airwaves are called spectrum. As mobile broadband becomes increasingly vital to economic growth, we must ensure that spectrum supply meets the growing demand. Smartphones use 24 times more spectrum than a basic phone; tablets use 125 times more spectrum. Without action, we will see mobile growth choked by spectrum congestion, and consumers — both individuals and businesses — facing deteriorating service and needlessly rising prices.
That's why the FCC has proposed a market-based solution known as voluntary incentive auctions to free up new spectrum and meet our rapidly growing mobile broadband needs in this century. Congressional leaders on a bipartisan basis have supported this; now it's time to move forward.
Broadband: 21st century infrastructure
The third critical element is to continue taking actions to lower the cost of broadband build-out and accelerate deployment. An example is the "Dig Once" idea: When we build or repair roads, let's lay fiber at the same time, which would dramatically cut the costs of broadband access.
Last century, building roads and bridges not only created near-term jobs coming out of the Depression, they laid the foundation for ongoing economic success by connecting communities and people across the country. Broadband can do the same in the 21st century. Yes, let's repair our roads and bridges, but let's also build the road to our economic future with broadband — especially when we can do both at the same time. And let's make sure that all Americans and small businesses get connected.
Our economy is not where we want it to be. But if we harness the power of communications technology, and unleash the creativity of our great entrepreneurs, there's much we can do to ensure our brightest days are still ahead of us.
Julius Genachowski is chairman of the Federal Communications Commission.Administrator, KRVR.org email@example.com
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