Sunday, December 4, 2011

FCC Initiating CAF

The FCC is overhauling both the FCC’s outdated universal service and Intercarrier Compensations systems into a new “Connect America Fund” (CAF), to connect all Americans to broadband. CAF will put the country on the path to universal broadband and advance mobile coverage without increasing costs.

The CAF has an annual budget of no more than $4.5 billion, the same as the current universal service funding level and is expected to help connect 7 million to high-speed internet and voice in rural areas over the next six years. This FCC Order is taking into account the growing importance of mobile broadband and makes it an independent universal service objective for the first time. Support to expand mobile broadband nationwide to tens of thousands of road miles will be provided through a new Mobility Fund

At the same time, the FCC is phasing down antiquated and opaque regulated charges for the exchange of voice traffic among carriers known as Intercarrier Compensation. Now, there will be a simplified uniform “bill-and-keep” framework which removes hidden subsidies on consumers’ bills, increases efficiency, and eliminates impediments to the deployment of modern networks.