Tl;dr would be "It's always been exempt because the USF was created for telephones before home broadband existed and no law was ever written to apply the fee to

Tl;dr would be "It's always been exempt because the USF was created for telephones before home broadband existed and no law was ever written to apply the fee to broadband. Lobbyists against net neutrality have been throwing around the idea that classifying broadband until Title II would force the USF fee to suddenly apply to broadband, but the FCC says there's no validity to that legal theory." Best background on it is probably the Wikipedia article[0], which is surprisingly thorough on this. Currently broadband is already exempt from USF fees because it's never been a "telecommunications service" in a way that's truly equivalent to how telephone lines are classified as a "telecommunications service". Everything around broadband regulation feels very piecemeal and disjointed because US politics/legislation in general has been largely piecemeal ever since broadband came out (except for the Patriot Act and ACA). When telephone was gaining popularity in the 1930's, Congress was in the habit of undertaking and enacting much bolder/unified/populist packages - Glass-Steagal/FDIC, Rural Electrification Act, the New Deal, etc and they wrote a big framework for telephony regulation with the Communications Act of 1934. The Telecommunications Act of 1996 built on the 1934 act to establish the "Universal Service Fund"; but broadband was never formally that type of "telecommunications service". This statement from the FCC announcing their intention to exempt broadband from USF is politically expedient for designating broadband to be regulated as a common carrier under Title II. That reason alone would likely be sufficient to drive this decision. I doubt that it's the entire rationale, but it is enough. Net neutrality is the biggest issue that the current FCC leadership is looking at and the only issue where large amounts of money and power is potentially at stake. Net neutrality has a complex technical narrative that's difficult to communicate effectively to constituents. If corporate lobbying campaigns can push the message that the FCC's drive for net neutrality is the direct cause of a new fee, it could result in the public viewing net neutrality very negatively. In more detail, it's not clear that regulating broadband under Title II of the Communications Act of 1934 would actually require it to be subject to the Universal Service Fund (Telecommunications Act of 1996). That started as and remains just a talking point of lobbyists who are paid to argue against net neutrality. The FCC says they won't be forced to and there's not much in the way of super-detailed legal argument around the issue that I can find - if the FCC was wrong about that I'd expect someone would have published something which clearly walks through the issue and shows why they're wrong. The current leadership of the FCC is generally focused on benefitting the consumer. Their current focuses could be called "populist" but it seems like the current FCC leadership really does want everyone to win and genuinely doesn't appear to be overtly/reactively/dogmatically hostile to corporate interests on the whole. The main two things I've seen this FCC taking on are moving broadband to Title II common-carrier status, and taking a look at Xfinity charging customers $50 if they go over a 1.2TB/month data cap[1]. However, one commissioner shared more about what he's focused on here on HN[2]. 0: https://en.wikipedia.org/wiki/Universal_Service_Fund https://en.wikipedia.org/wiki/Universal_Service_Fund 1: Consumers can violate Xfinity's data cap by using the offered 1Gbps download speed for just 3 hours per month (or 6 minutes per day) and the "meter" is not something that can be inspected or calibrated by states' Weights & Measures divisions. 2: https://news.ycombinator.com/item?id=37392676 https://news.ycombinator.com/item?id=37392676