Consumer Groups Urge FCC To Reject “ABC Plan” For Universal Service Fund

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News Release

Consumers Union – Publisher of Consumer Reports

Tuesday, October 04, 2011

WASHINGTON —  Consumers Union, Consumer Federation of America, the National Consumer Law Center, National Association of State Utility Consumer Advocates and AARP today sent a joint letter to the Federal Communications Commission (FCC) to raise serious concerns about the broadband industry’s proposal to restructure the Universal Service Fund (USF).

In the letter to the four members of the FCC, the groups said the industry’s proposal “would harm consumers, especially the most vulnerable, including seniors and low-income households.”

“In particular, the industry plan would significantly and unfairly increase the cost of basic home phone service,” the groups wrote.

Instead of moving forward with the industry’s America’s Broadband Connectivity (ABC) Plan, the organizations urged the FCC to reform USF in a way that they said would better serve the public interest.

They said the proposal would place a greater financial burden on consumers at a time when they can least afford the extra costs, pointing to the ABC plan’s increase in the Subscriber Line Charge (SLC).

The proposal would wipe out key consumer rights and protections, and it contains no mechanisms to ensure that USF funds would be used to provide affordable, quality service, the organizations said.

“For years, our organizations have been working to promote a vision of universal service for basic telephone service – and now broadband – so that all consumers can benefit from the tremendous opportunities provided by a basic communication service,” the groups said.  “While we recognize that USF reform is truly needed, we cannot accept the premise of the ABC Plan – that consumers, especially the most vulnerable, should bear the burden of increased costs while allowing the companies to maintain excessive profits with no oversight or accountability.  Thus, rather than endorsing or pursuing the ABC Plan, the Commission should move forward on a plan that promotes the public interest and provides for affordable universal service.”

For a copy of the letter, please contact David Butler or Kara Kelber at Consumers Union, the public policy division of Consumer Reports, at 202-462-6262, dbutler@consumer.org  or kkelber@consumer.org.