Universal Service in a Ubiquitous Digital Network

Before there was the digital divide there was the analog divide -- and universal service was the attempt to close that analog divide. Universal service is becoming ever more complex in terms of regulatory design as it becomes the digital divide. In order to evaluate the promise of the next generation Internet with respect to the digital divide this work looks backwards as well as forwards in time. By evaluating why previous universal service mechanisms failed and succeeded this work identifies specific characteristics of communications systems -- in particular in billing and managing uncertainty -- and argues that these characteristics underlie success or failure in terms of technological ubiquity. Developing a set of characteristics of services rather than a set of services is a fundamental break with the tradition of universal service. In fact, the implications of our proposal is that basic characteristics in the offering of the service rather than the absolute price are critical to close the digital divide: certainty of total charge, ability to avoid deposits or disconnection via best effort service, and payer-based control of all charges. While all of these principles sound obvious in fact none of these hold in the telephony network.