Trust as Infrastructure: State-Level Universal Service, Privacy Concerns, and Home Internet Use

• In Event: AI Governance and Public Capacity in an Uneven Policy Landscape

Abstract

The United States has leveraged programs like the Universal Service Fund (USF) to expand affordable telecommunications access and bridge persistent digital divides, particularly in rural and underserved communities. In parallel, growing cybersecurity and supply-chain risks prompted the Secure and Trusted Communications Networks “Rip and Replace” program, which uses USF resources to remove and replace high-risk equipment from U.S. networks. Yet despite these efforts, universal service remains elusive, and concerns over privacy and security may be emerging as a new barrier to residential Internet adoption.  

This study asks two questions: First, what state-specific factors are associated with the distribution of USF disbursements? Second, what state-specific factors are associated with the share of residents who opt out of home Internet use due to privacy or security concerns? The aim is to identify structural patterns that may limit the effectiveness of federal universal service programs, and to surface opportunities for policy and programmatic adjustments.  

The article presents a novel state-level panel dataset for all 50 states and the District of Columbia for 2015, 2017, 2019, 2021, and 2023, combining data from the FCC, NTIA Internet Use Survey, American Community Survey, Bureau of Economic Analysis, and U.S. Department of Education. Ordinary least squares regression is used to examine predictors of USF disbursements per state and predictors of the percentage of residents opting out of home Internet use citing privacy or security concerns. A secondary 2023-only model incorporating cumulative Rip and Replace funding estimates is also analyzed.  

For USF distributions, smartphone adoption is positively associated with USF disbursements, while higher mean household income is associated with lower USF funding at the state level, and education spending shows a smaller, near-significant positive association. For opting out due to privacy or security concerns, higher mean household income and a larger share of residents over age 65 are both positively and significantly associated with higher opt‑out rates, an unexpected pattern that suggests privacy and security concerns are not confined to low-income or younger populations. In the 2023-only model, preliminary evidence indicates a possible positive relationship between estimated Rip and Replace funding needs and privacy-related opt‑outs, although this relationship is only marginally significant and limited by sample size. Notably, population density, agriculture employment, and technology employment are not significantly associated with either USF distributions or privacy-driven opt‑outs.  

These results suggest that current universal service strategies may insufficiently account for how income, aging populations, and security controversies shape trust in telecommunications infrastructure and willingness to adopt home Internet service. Emerging links between large-scale security remediation efforts, such as Rip and Replace, and privacy-driven non‑adoption highlight the need to pair infrastructure investment with community-level engagement and privacy‑focused policy design. The next phase of this research will use state and local case studies, interviews, and surveys to explain why higher-income and older residents opt out due to privacy and security concerns and to inform a policy framework that better aligns USF and related programs with evolving public trust and safety needs.

Author

• Erika Heeren-Moon, Virginia Polytechnic Institute & State University
  Presenting Author