New tax on VOIP to go to . . . nothing

The Jeff Pulver Blog: Guest Blogger: Daniel Berninger – “Universal Service Fund generated remarkably meager results for $50 billion spent”

I’ve been using Vonage’s VOIP service ever since I bought my condo in March 2005. I’ve been pretty happy with it, although their tech support is less than perfect. Now, the link above is an open letter to Congressional Commerce Committees about the decision of the FCC to apply the Universal Service Fund to VOIP. The USF is supposed to bring telephone service to poor rural areas, a noble goal as far as I’m concerned. But the gist of the letter is that what the USF really does is make it that much harder for Vonage and other VOIP providers to turn the phone industry into a real competitive market.

I think one of the real problems is that, too often, little bits of data transmitted over our internet connections are treated as different objects when they really aren’t. Somehow, it’s totally different, according to some, to transfer voice instead of video, or data instead of voice. This is ridiculous. It’s all the same stuff. It’s as if we decided that you needed one highway for automobiles, and one for SUVs. Never mind that many small car drivers would love this, that’s not the point. The point is that it doesn’t matter what you’re sending. This device produces this data, and sends it to that device, which receives it. Does it matter if the first device was a webcam or a VOIP phone?

Apparently it does, and the FCC is going to tax it. I don’t have a problem with the FCC taxing communication to raise money for things that need to be done, but the USF has spent $50 billion over the last 20 years to increase phone penetration in rural areas by about 3%. I would hereby like to volunteer to accept $50 billion and spend the next 20 years trying to get a phone for every person in America. If I don’t have 99% coverage by 2027, feel free to put me in jail. I’ll deserve it.

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