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    Posted August 3, 2011 by
    peone

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    Free Cell Phones For the Needy

     

    Free cell phones for the needy drawing both cheers and jeers

    Universal Service Fund

    The Telecommunications Act of 1996 requires  phone service providers  to contribute a percentage of usage revenue  each quarter to the  Universal Service Fund.

    It's designed to help schools, libraries and  low-income and rural  residents secure several types of phone service,  including cell  service.

    Customers might notice a "Universal Service"  line item on their bills.


    Sharron Walters could not afford one more monthly bill.  But without a phone, it would be difficult for Walters, who relies on  a wheelchair, to secure rides to and from her daily errands. She also  could not keep in touch with her son, who lives out of town.

    Three months ago, Walters, 48, of Swissvale started using Assurance  Wireless, a program of Sprint subsidiary Virgin Mobile that provides  free cell phones and 250 monthly minutes to people receiving government  support such as Medicaid or food stamps.

    "The service they provide is just truly a blessing," she said.

    In Pennsylvania, two programs offer free cell service: Assurance  Wireless and SafeLink from Tracfone Wireless, which specializes in  "no-contract" cellular service. The federal Universal Service Fund,  which all telecommunications providers support as required by federal  law, pays for the programs.

    Amy Storey, a spokeswoman for CTIA - The Wireless Association in  Washington, said all U.S. wireless carriers charge consumers a fee to  recover the cost of their contribution to the fund, which varies  quarterly as determined by the Federal Communications Commission.

    Assurance Wireless, which is in 26 states and Washington, D.C.,  started in Pennsylvania in February and is now being publicized in  newspaper, TV and radio ads. The company reports more than 5.5 million  people could qualify for the program in Pennsylvania. Gary Carter,  manager of national partnerships for Assurance, was not able to provide  the exact number of people who have signed up.

    SafeLink, which has been available to Pennsylvanians for three years,  is in 39 states. Spokesman Jose Fuentes could not provide an exact  number of users in Pennsylvania, but said there are more than 2 million  nationwide.

    "The program is about peace of mind," Carter said. "It's one less  bill that someone has to pay, so they can pay their rent or for day  care. ... It is a right to have peace of mind."

    Critics of the program say free cell service is no right, particularly in an unstable economic climate.

    Robert Rector, a senior research fellow at the Heritage Foundation, a  conservative think tank in Washington, said that with $910 billion of  the national budget slated for low-income assistance, he finds free cell  phone programs "particularly wasteful and unnecessary."

    "Our society cannot afford to give free everything to everybody," he  said. "Most poor people already had adequate telephone service and will  continue to do so."

    George Loewenstein, economics and psychology professor at Carnegie  Mellon University, said phone companies could lose money from the  programs if customers seek free service when they otherwise might have  found a way to pay for it. However, he said, the programs likely benefit  the overall economy as having a phone can help people find jobs.

    "We've hit a tipping point," he said. "It used to be that a public  phone was on every corner. As cell phones become more prevalent, public  phones are gradually disappearing."

    Assurance and SafeLink get $10 per subscriber monthly from the  Universal Service Fund, which covers the cost of 250 minutes, said  Carter. The companies pay for the phones, which Carter describes as  "very simplistic models, not smartphones." The primary handset for  Assurance users is the Kyocera Jax, which retails for about $10. That  model does not have a camera, MP3 player or Bluetooth capability.

    Assurance pays for its advertising. Agreements run for one year;  every 12 months, customers must provide proof of income. The eventual  goal, Carter said, is to retain them as paying customers.

    Roberta Lebedda, 37, of Lincoln Place said she researched the  Assurance program after seeing print advertisements and was disappointed  to discover she was not eligible for a free phone, even though she  helps fund the program through her phone bill.

    "It's a nicety, not a necessity," she said. "Everybody wants a cell phone, but we don't need it to live."


    Read more: Free cell phones for the needy drawing both cheers and jeers - Pittsburgh Tribune-Review http://www.pittsburghlive.com/x/pittsburghtrib/news/s_749344.html#ixzz1U1hCkPi

     

    The Telecommunications Act of 1996 requires phone carriers to contribute to the universal service fund.  The fund is designed to help schools. libraries and low income and rural residents to get phone services.

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