• Industry: Media, Telecommunications
  • Date: 9/5/2012

Understanding the Impact of the Universal Service Fund and Intercarrier Compensation Transformation Order 

The 2011 Federal Communications Commission’s (FCC) Universal Service Fund (USF) and Intercarrier Compensation (ICC) Transformation Order is expected to have far-reaching consequences for the telecommunications sector.

The order is intended to improve the accessibility and affordability of broadband services and foster greater accountability with respect to taxpayer-funded subsidies.


With several phases of the USF/ICC Transformation Order in effect and others due to come on line later in 2012, providers are under pressure to respond quickly.


The changes outlined in the order will affect a wide swath of business functions, from strategy and operations to the core business model itself. The order will have major implications for the telecommunications sector, chief among them:


  • Market-driven changes may punish inefficient operators
  • Near-term revenue streams may be negatively impacted
  • Oversight requirements may stress current process and control environment
  • Carriers with outdated technologies may need to upgrade