Curious About Who Pays for “Free” Phones?

By Ken Tucci, WBZ-TV
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Who pays for those “free” cell phones from SafeLink? – Mark, Norwell

Paying customers pay for the “free” cell phones for others.

You’ve probably seen the ads saying you can get a free cell phone and free service, if you’re low income.

It is a Federal program, but no tax dollars are used.  Instead, telecom companies pay for it, but most of them pass along the cost to their customers, so really they don’t pay for it, paying customers pay for it.  You’ll see the charges on your cell bill as the Universal Service Fee or the Universal Connectivity Fee.

Watch video:

The idea behind the program is to give poorer people phone access.  The presumption apparently is that people with low incomes can’t afford phone service and that phone service is a necessity, so it should be subsidized for them.  Hence, “universal” service fee.

There’s a myth going around the internet that these are called “Obama phones.”  But in reality the program began for land lines during the Reagan administration, and cell phones are an extension of that.

There are millions of people in the program in 31 states, the District of Columbia and Puerto Rico.

What do you think of this program….and please be polite.

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