It is paid for by the non tax tax on phone bills.

Reader comment on: Broadband for the Poor

Submitted by Lyle (United States), Nov 9, 2011 17:00

If you look at your phone bill you find the federal (and likely state) universal service fee, this is what pays for this. The federal fee is $6.50/line per month on a land line. Since the FCC decided to change the focus of the fee from rural (high cost) phone service to broadband this is the result. Of course the rural fee was a good deal allowing if you live in the correct place one to get phone service for 1/2 of what the cost of service in a metro area would cost, it was always a subsidy. Of course in my telephone coop until the change the basic cost of service before fees was $6.50 and you typically 10 years later would get $10/month back in dividends, thus a good deal.

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