US Congress: Big Tech to participate in financing grid expansion

The US Senate wants to reorganize the financing of basic telecommunications services and thus also involve Big Tech in network expansion costs. To this end, senators from both parties reintroduced a bill on Wednesday that had already failed to pass through Congress two years ago.

The aim of the "Lowering Broadband Costs for Consumers Act of 2025" is to involve large edge providers such as Amazon, Google, Meta and Microsoft in the financing of the Universal Service Fund (USF) alongside network operators. The US regulatory authority, the Federal Communications Commission (FCC), uses the USF to distribute subsidies for expansion and connections in rural regions.

Telephone on the farm

The USF was set up in 1996 with the reform of US telecommunications law in order to provide citizens in remote regions with a telephone connection. The US government is now also supporting broadband expansion. Last year, the USF had a volume of around 8.5 billion US dollars.

The program comprises four pillars: Direct subsidies for connections that would be too expensive without government help, as well as subsidies for socially vulnerable customers. In addition, the USF will be used to connect educational institutions and secure telemedical care.

With their renewed initiative, Senators Markwayne Mullin (R-OK), Mark Kelly (D-AZ), Mike Crapo (R-ID) and Kevin Cramer (R-ND) want to ensure that the companies that benefit significantly from the expansion of the networks also participate in the funding: Big Tech. At the same time, the senators want to use the initiative to clarify the FCC's powers with regard to funding.

The USF is not without controversy. Critics criticize the inefficiency of the direct subsidies, which do not contribute significantly to the expansion despite the billions that have flowed in over the years. Grid operators are also in favor of putting the USF on a modern footing.

Proceedings before the Supreme Court

The USF is the subject of a case currently before the Supreme Court. The Republican-affiliated consumer protection organization Consumers' Research had complained that the contributions to the USF constitute a de facto tax. However, only the legislator is entitled to set them and the FCC's powers should be more clearly defined.

After Consumers' Research was rebuffed in several courts, an appeals chamber of the organization upheld the complaint in the summer of 2024, thereby removing the legal basis for the previous funding model. While it did not appear at the oral hearing at the end of March that the Supreme Court wanted to follow this reasoning entirely, the highest judges also appear to consider a reform of the USF advisable.

Against this backdrop, the renewed push by the US senators could fall on more fertile ground than two years ago. On this side of the Atlantic, too, Big Tech's contribution to the costs of network infrastructure has been the subject of heated debate for years. In Europe, the major carriers in particular are demanding an infrastructure levy from Meta and Co.

(vbr)