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The Federal Communications Commission has unanimously proposed to shift the purpose of the Universal Service Fund from providing telephone service to underserved areas to helping to build broadband. The FCC’s plan is to reclassify broadband as a telecommunications service, which would give the agency the chance to use Universal Service Fund money build out broadband. There’s a problem with that strategy. A recent Supreme Court ruling called into question the FCC’s legal standing to exert authority over the Internet. 

The FCC issued a long notice of inquiry and proposed rulemaking.  This begins the process of phasing out the $4.6 billion a year Universal Service Fund, replacing it with a fund that would aid the deployment of broadband. “This item is an important milestone in our deeply important effort to ensure that every American, no matter where they live or what they earn, has access to affordable, high-quality broadband communications service,” FCC Chairman Julius Genachowski said. “It will not be easy. But that is what we are committed to do.” h

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