Lifeline/Low-Income Consumers

The clock is ticking until the Supreme Court issues its verdict on the $8 billion Universal Service Fund. Even if USF survives the legal battle, the question remains—what then?

The Universal Service Fund's reliance on a shrinking base of traditional voice services has created an unsustainable contribution rate, prompting industry leaders to call for technology giants to start paying into the fund. While companies like Apple, Amazon, Meta, and Netflix earn an estimated $2,600 annually from each household connected through the USF, they contribute virtually nothing to maintaining that connectivity. The discussion comes as the Supreme Court prepares to rule on a Constitutional challenge to the fund's structure in Federal Communications Commission v.

The Universal Service Administrative Company submitted the contribution base amount to be used for the third quarter of calendar year 2025 (3Q2025). The total projected collected interstate and international end-user revenue base to determine the contribution factor for the Universal Service support mechanisms for 3Q2025 is $8,045,954,273. 

The government giveth, and the government taketh away? That may be the case for the future of school-bus Wi-Fi, which is currently eligible for E-Rate discount under the Federal Communications Commission’s Universal Services Fund. Whether that will continue is now uncertain due to court cases challenging the validity of the USF funding model. In late March, the U.S. Supreme Court heard arguments on an appeal of a 5th Circuit decision that the Universal Service Fund’s revenue mechanism represents an unconstitutional delegation of legislative authority.

The Public Service Commission of Wisconsin announced the award of $750,000 to non-profit and higher-learning entities that will help people in Wisconsin access essential telecommunications services. The Commission awarded a total of 19 grants from the 2025 rounds of the Nonprofit Access Grant Program and the Lifeline Outreach Grant Program, both of which are funded by the Universal Service Fund.

While it’s not common for an Federal Communications Commission issue to face the court of last resort, two combined lawsuits recently heard before the bench—Federal Communications Commission v. Consumers' Research and Schools, Health & Libraries Coalition v. Consumers' Research—could put millions of anchor institutions, rural communities and American families nationwide in real jeopardy of losing connectivity.

The Benton Institute for Broadband & Society joined Access Humboldt, Common Sense Media, Everyone On, Massachusetts Law Reform Institute, National Digital Inclusion Alliance, and New America's Open Technology Institute (all members of the Lifeline Coalition*) in a filing in the Federal Communications Commission's RE: DELETE, DELETE, DELETE proceeding. With the expiration of the Affordable Connectivity Program, millions of households lost the support they relied on to access the internet.

The Universal Service Fund’s day in court came and went, and the U.S. telecommunications industry still has hope the subsidy will live to see another day. But even if the Supreme Court deems the USF framework constitutional, there’s still no easy path to reform the program. The Supreme Court heard arguments related to the Fifth Circuit’s decision that the USF’s funding method is unconstitutional.

The Supreme Court held oral arguments in Federal Communications Commission v. Consumers' Research, a case challenging the legality of the Universal Service Fund framework.

The Universal Service Fund has done little or nothing for universal service. Mobile phones and the internet have become ubiquitous in rural areas and among those of low income. Most schools, libraries, and healthcare facilities have been hooked up for years (to the dismay of many teachers). This is thanks to the alacrity of today’s high technology, massive private investments, profound improvements in service quality and proficiency, and constantly falling prices.