USF Contribution Factor to Drop From 17.9 to 17.4 Percent, Consultant Gregg Says
The USF contribution factor for Q4 will decrease from 17.9 percent to 17.4 percent of carrier interstate and international telecom end-user revenue, said industry consultant Billy Jack Gregg in an email update Thursday. Despite a Universal Service Administrative Co. projection…
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that the industry revenue base will fall to its lowest quarterly level ever at $14.2 billion, the contribution factor will drop because USAC had projected Q4 USF demand would drop (see 1608030047). Total 2016 USF demand will be $8.76 billion, "$67.4 million higher than 2015, but $772.7 million less than peak annual USF demand during 2012," he wrote. "However, because of the continued decline in the USF revenue base, the average assessment factor for all of 2016 will be 17.8%, the highest average assessment factor in the history of the USF." The previous highest average was 17.1% in 2012, and it was 16.9 percent in 2015, he said.