FCC ruling could mean higher VoIP bills

A new plan by the FCC to keep the Universal Service Fund stocked in anticipation of the coming August exemption for DSL providers will likely lead to higher VoIP bills for consumers. The agency has ruled that companies like Vonage and SunRocket who offer Internet telephony services must now pay 7% of their revenue into the fund -- used to subsidize rural and low-income phone service -- which has been traditionally been stocked by taxing POTS and DSL providers at a rate of 10.9%. However, since DSL providers have been let off the hook for this program, the FCC needed to make up for the shortfall, so the agency both instituted the VoIP component and raised cellular carriers' contribution from 3% to 4%. Since providers tend to pass new costs on to the consumer, we can probably expect to see higher VoIP bills in the near future, but luckily the recent repeal of that Spanish-American war-era excise tax should mostly balance things out on the cellphone side of things.