FCC broadband plan promises extra $1bn to cover rural areas

The US Federal Communications Commission (FCC) is to overhaul its carrier fee programme to better stimulate the growth of broadband networks, as part of a plan by FCC chairman Julius Genachowski to establish the Connect America Fund.

Under the plan, the FCC will use money collected from telecoms carriers under the the current Universal Service Fund (USF) to build out broadband infrastructure in underserved areas in the US, particularly rural communities.

Genachowski estimates that the planned reform could yield as much as $1bn for broadband spending annually.

"Despite spending $4.5bn per year, USF is failing to get broadband to approximately 18 million Americans in rural areas," Genachowski said.

"This plan would ensure that money is spent in a more targeted and efficient way, bringing greater fairness and benefit for consumers who pay into USF each month."

Extending a national broadband system in the US has been a primary goal of the FCC and the Obama administration in recent years.

Many rural areas in the US are sparsely populated and require installation of equipment in uninhabited areas, and some commercial carriers have yet to offer coverage.

Genachowski suggested that the Connect America Fund could extend services to hundreds of thousands of homes currently lacking broadband.

"It will help cut the number of Americans bypassed by broadband by up to one half over the following five years, and it will put us on the path to universal broadband by the end of the decade," he said.

"By connecting millions of unserved Americans who are being left out of the broadband revolution, this plan will bring enormous benefits to individual consumers, our national economy and our global competitiveness."