FCC: One-Third Of Americans Aren’t Online

In a call to action, Federal Communications Commission Chairman Julius Genachowski called out the U.S. government for lagging behind on broadband infrastructure.

Speaking at the Information Technology and Innovation Foundation event in Washington, Genachowski said the U.S. recently ranked last in a survey out of 40 industrialized countries on the rate of improvement in broadband network infrastructure as well as innovation and competitiveness. He also said nearly one-third of the country isn't online, which compares negatively to a country like Singapore, where that figure is under ten percent.

To seize the opportunities of broadband, we need improvement across the broadband economy. Advances in applications, devices, and networks will drive innovation and investment across the full broadband ecosystem - maximizing benefits for all, Genachowski said. Up to 24 million Americans couldn't get broadband today even if they wanted it. The infrastructure simply isn't there.

Bringing broadband to everyone in the country has been the main mission of The Broadband Plan, the organization's outlined initiative. The $20 million plan aims to bring every American the opportunity and infrastructure for broadband internet. The FCC. says 14-24 million Americans still don't have access to broadband.

In his comments, Genachowski said the Universal Service Fund, which was established in 1934, needs to be modernized. He said the program, which was has helped everyone American connect to 20th century communications, is broken.

But while the world has changed around it, USF -- in too many ways -- has stood still, and even moved backwards, Genachowski said. The program is still designed to support traditional telephone service. It's a 20th century program poorly suited for the challenges of a 21st century world.

He said this can be accomplished by eliminating waste. One example of this would be a reduction in funding for duplicative phone service by multiple phone companies operating in the same area. The money saved from this, he said, could be used to create the Connect America Fund, which in turn would invest in rural broadband infrastructure.

Genachowski did not just focus on internet reform. He is also looking to reform the Intercarrier Compensation system, where phone companies often pay each other for connecting calls in rural areas.

The chairman would like to get rid of wasteful billing disputes by closing loopholes and tightening rules to prevent phantom traffic, which is traffic that has been disguised so it can't be identified for billing purposes. Practices like this, the FCC said, can make it 10 times more expensive to call someone in a rural area a few towns over than to call someone on the other side of the world.

The Intercarrier Compensation system is not only flawed, it's unstable. Overall intercarrier revenues are in rapid and unpredictable decline, as more and more people drop landline phone service, Genachowski said.