Phone companies concerned over possible FCC changes - KWWL - Eastern Iowa Breaking News, Weather, Closings

Phone companies concerned over possible FCC changes


The Federal Communications Commission could soon be issuing new rules that would affect telephone and internet providers across Iowa.  The FCC is considering a revamp of the universal service fund, which accounts for up to 70 percent of revenue for some smaller companies.  And that's why changes to the fund are concerning for phone and internet providers.

Phone and internet are two communication services that make the world go ‘round.  Even as more people switch to cell phones to meet their calling and web needs, wireless companies to deliver those services.  And part of how those companies keep your services running, comes through money you pay into the universal service fund or USF.

"The network still needs to be maintained, still needs to be invested in as we transition from a system that's been toward the phone system and phone service toward broadband," said Jerry Melick, manager of Liberty Communications in West Liberty.

But the FCC is considering changes to how USF money gets spent.  The goal is to force phone and internet companies to use that funding solely to expand broadband services.  Phone companies are on board with that goal, but don't think that using only USF money is the answer.

"What the FCC's trying to do is take the same dollars and flow of money and redistribute it toward accelerating broadband in larger cities that hasn't been done by some of the larger companies.  So taking the same pot of money and try to make it go two directions and do more, that's just a fundamental problem," Melick said.

And without USF funds to help maintain and upgrade phone and internet services, communication companies would be forced into charging you more for those services each month.

"If you raise the price too high, people are going to cut the cord and drop the service.  And really then you're not getting any revenue to continue to invest in the network," said Melick.

Ultimately, local phone providers hope the FCC will hear their concerns and come up with an alternate way to fund the much-desired expansion of broadband services.

Local phone companies are encouraging customers to contact area Congressional representatives to voice their concerns about the proposed changes.  The FCC is reviewing the changes now and is expected to issue final rules for broadband expansion in October or November.

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