VoIP is an interconnected service, meaning that calls can be made from an IP phone over the internet to a mobile or landline phone and other mediums of communication. In fact, most telecommunication services possess this interconnectability, and as such, are subject to a Universal Service Surcharge. The Universal Service Fund was created by the FCC in 1997 to meet Congressional universal service goals mandated by the Telecommunications Act of 1996, which aims to promote the availability of quality services at just, reasonable and affordable rates for all customers.

Telecommunications companies and VoIP providers alike, must pay a percentage of their interstate end-user revenues towards this amount. Following an assessment by the FCC, providers will be given a detailed statistical report that highlights the amount they must pay. The amount of which the provider pays towards the FCC (as required by law) is then, typically charged down to the consumer. There are quarterly amounts paid, all depending on the revenue generated by the company in conjunction with the needs of Universal Service programs – so this amount may increase or decrease four times over the course of a year.

Although not required to pass these charges onto consumers, many carriers choose to do so to lessen costs to the company for providing service. In the same regard, non-profit organizations, schools, and churches may be exempt from paying this charge as they are the main benefactors to this policy and fee. Telephone service is viewed as essential and important (such as when in need of emergency services). The Universal Service Surcharge is the result of the FCC’s regulation to make sure this resource, among others, is available to all.

Additional Reading
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What is a Regulatory Recovery Fee?
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