Illustration: Eniola Odetunde/Axios
The FCC's incoming chair Brendan Carr wants Big Tech to pay fees for a key phone and internet service fund, but congressional roadblocks could slow him down.
Why it matters: Carr wants to go after tech on various fronts, from trying to tax them to stripping their liability shield.
In the Heritage Foundation's Project 2025 chapter that he wrote, Carr calls for Big Tech to pay into the $9 billion Universal Service Fund, which is currently paid for by consumers through a charge on their monthly phone bills.
- The money helps people in rural, high-cost areas pay for phone service, as well as schools, libraries and some health care facilities.
- Carr reasons that Big Tech benefits from people having internet access to use their products and should therefore pay into the fund.
The details are scarce, however, with Carr only saying Congress should require the companies to contribute "an appropriate amount."
- Carr also writes that the incoming administration should ask the FCC to review all of its existing broadband programs to avoid duplication.
But Carr faces competing proposals on Capitol Hill.
- Sen. Ted Cruz, who is poised to lead the Commerce Committee, thinks funding should come from congressional appropriations and is against taxing tech companies.
- A USF working group launched more than a year ago by incoming Senate Majority Leader John Thune and Sen. Ben Ray Luján has been fielding ideas on how to reform the fund, but has not finalized legislative text.
Gigi Sohn, Biden's former FCC nominee, pushed back on the framing that the fees would only impact a handful of companies, noting that if the fees are imposed on digital advertising it would sweep in a host of other players like cable companies or streaming services.
- "I think it would be extremely difficult to place a fee that would just affect Big Tech. It would necessarily brush broader," said Sohn, Benton senior fellow and public advocate.
- She added that she would be "very surprised" if the USF working group doesn't agree on a fee that goes beyond broadband.
Luján has introduced bipartisan legislation to direct the FCC to study how collecting fees from internet providers could work.
- The bill calls for the agency to examine revenue sources, the "fairness" of the current system and how the FCC could assess such a broad set of companies that don't register with them.
- Hashing out those details is crucial, said former FCC official Carol Mattey, who said regulators need to figure out what constitutes a tech company, and how evasion tactics like company restructuring could be addressed.
- Congress and the FCC are sure to face intense Big Tech lobbying, Mattey said: "They obviously have tremendous resources and talent, and so if this is something they oppose, I think it could be a protracted battle."
The big picture: There is animosity against Big Tech in the incoming Trump administration and among Republicans on the Hill who feel they've been censored.
- Imposing fees on tech may also run up against Trump administration and Elon Musk goals of reining in the administrative state, said Information Technology and Innovation Foundation's Joe Kane, whose group believes congressional appropriations for an Affordable Connectivity Program-type effort is most appropriate.
What we're watching: The Supreme Court may decide to take on a case questioning the constitutionality of the USF, which may make efforts to overhaul the fund moot.
