You’re reading the Benton Institute for Broadband & Society’s Weekly Digest, a recap of the biggest (or most overlooked) broadband stories of the week. The digest is delivered via e-mail each Friday.

Round-Up for the Week of December 2-6, 2024

Earlier this year, a Benton Institute for Broadband & Society survey of low-income households found that 13 percent of Affordable Connectivity Program (ACP) participants (approximately 3 million households) would disconnect their home internet service without the subsidy and 36 percent (or 8.3 million households) would downgrade to a cheaper or slower plan.

Although the 118th Congress failed to provide additional funding needed to keep ACP running, some continue to advocate for a permanent solution to make broadband service affordable for low-income households moving forward. This week, EducationSuperHighway proposed a new program in a report titled A Broadband Affordability Benefit to Connect the Unconnected. Below, we quickly recap EducationSuperHighway's proposal.

A Benefit for Unconnected Households

EducationSuperHighway (ESH) is proposing a benefit—$30/month or $75/month for households on Tribal lands or in high-cost rural areas—that is designed to help households that are either unconnected to internet service or at imminent risk of being disconnected. Per ESH's analysis, roughly 19.3 million households could benefit from this program. That includes 16.3 million households that cannot afford internet service despite having (or being soon to have) access to broadband infrastructure and an additional 3 million households that have service but are "likely to disconnect" without a subsidy, like ACP. 

ESH proposes that the new benefit be primarily aimed at low-income households. To do this, they suggest eligibility pathways similar to ACP, such as household income at or below 200 percent of the federal poverty level and/or participation in specific assistance programs, such as SNAP, Medicaid, WIC, SSI, VA benefits, Free and Reduced-Price School Meals (but not the Community Eligibility Provision), Pell Grants, Government Housing Assistance Programs, and Tribal benefits.

However, unlike ACP, ESH proposes that internet service providers (ISPs) be required to verify that the beneficiary household is not a current or recent (within 60 days) broadband customer. For households that are current customers but are likely to disconnect, the following options apply:

• If a customer is 60 days delinquent on its bill and can demonstrate eligibility, ESH's proposal allows ISPs to offer the customer a chance to downgrade their service to an eligible plan.
• If a customer calls their ISP to cancel their subscription due to affordability challenges (e.g. demonstrable financial hardship or change in circumstances), the ISP can offer them a plan covered by the benefit.

Additionally, ESH's proposal would limit which plans the benefit could be applied to. Eligible plans would have to provide home (not mobile) internet service, offer speeds that meet the FCC's minimum standard for broadband (i.e 100 megabits per second download and 20 megabits per second upload), and be free after applying the benefit (i.e. cost $30/month or less, or $75/month or less on Tribal Lands or high-cost rural areas). ESH believes these limitations would leverage market forces because households that purchase more expensive, higher-performance plans can afford to pay for them and are unlikely to downgrade to take advantage of the benefit. 

Lifeline Complement

ESH envisions the new benefit co-existing with the Federal Communications Commission's Lifeline program, which provides a $9.95/month discount on internet and telecommunications services for low-income households. ESH recommends that the Lifeline program continue, supporting mobile phone plans, while the new broadband affordability benefit should focus solely on home broadband.

ESH acknowledges that internet access outside the home is critical to staying connected, but stresses that households need reliable and affordable home broadband. Remote work, homework, job applications, and telehealth can be highly challenging on smaller screens, so it is critical that families have reliable, stable connections without data caps.

Consumer Protections

ESH proposes that all of the ACP consumer protection rules apply to the new benefit. ISPs would be prohibited from excluding consumers with past-due balances or prior debt from enrolling in the program and subscribing to the $30 plan. ESH believes that restricting the benefit to certain plans will have a negligible impact on consumer choice, as most urban and suburban residents have two or three internet providers from which to choose, and the Infrastructure Investment and Jobs Act's broadband deployment program will ensure residents in more rural regions will have increased provider offerings. And, ultimately, the benefit would give unconnected households access to plans that would otherwise be unaffordable. ESH's proposal also provides participating ISPs with a simple way to downgrade subscriptions of vulnerable households that qualify for the benefit but for whom a change in circumstances has put them at risk of losing service.

How to Pay for the New Benefit

ESH sees a path to build a long-term broadband affordability benefit with bipartisan support and fulfills the shared goal of internet for all: 

ESH believes this approach would not raise the overall cost of the Universal Service Fund. A transition period would allow existing USF High Cost Programs to deliver on their commitments while still providing sufficient funding to cover gradual uptake of the new affordability benefit. Additionally, creating the new program within the USF permanently removes the need for future Congressional appropriations and additional government funding. ESH also believes that this approach would leave sufficient money in the High Cost Program to cover operating expenses for rural broadband ISPs even after the deployment of new networks.

ESH is factoring in the adoption of a new broadband affordability benefit increasing gradually over time. ESH's model predicts sufficient funding will be available to match the 22 percent adoption rate by unconnected households achieved by the ACP after three years and to support more than double the enrollment level by 2039.

The FCC's High Cost Program comprises 18 separate legacy and modernized funds, most with defined end dates. Holding High Cost’s projected 2024 budget of $4.6 billion constant, each program’s funding can be repurposed towards a new broadband affordability benefit once each program has delivered on its commitments and reached its end date. ESH predicts:

• $974 million will be available by 2025
• $1.7 billion will be available by 2027
• $2.5 billion will be available by 2031—end of Rural Digital Opportunity Fund (RDOF) term
• $3.7 billion will be available by 2039—end of Enhanced Alternative Connect America Cost Model (E-ACAM) term

The ESH proposal would reserve $2.17 billion for High Cost programs post-2031.

Awareness, Trust, and Enrollment Barriers: Adopting Lessons Learned During ACP

Awareness, trust, and enrollment barriers prevented unconnected households from enrolling in ACP.

The ACP enrollment process included two main steps. Eligible households had to first confirm their eligibility, generally through an online portal called the National Verifier. Then, upon receiving an approval code, they had to use that code to purchase service from an ISP. The result was that many applicants received an approval code but never applied it to an internet plan.

ESH proposes the creation of an end-to-end online marketplace, managed by the Universal Service Administrative Company (USAC), that enables applicants to fully enroll in both the benefit and an internet service plan without navigating to other sites.

ESH also recognizes the market opportunity for ISPs to generate new business by reaching previously unconnected consumers—as well as how a self-sustaining outreach and awareness fund can drive adoption to a rate achieved by the ACP. So the ESH proposal includes a mechanism for ongoing enrollment support.

The plan is to create an all-inclusive, end-to-end online platform that enables an eligible applicant to fully enroll in both the benefit and an internet service plan without navigating to other sites. The “one-stop shop” platform is an online marketplace that lists all eligible home broadband plans in one place, ensuring consumers learn about and select the plan that best fits their needs. A key benefit of this comprehensive marketplace is that it can lower new customer acquisition costs and give access to a new consumer base, addressing the issue of small and rural ISPs needing help reaching customers. The platform promotes consumer choice and competition by displaying all available plans for consumers in one place, no longer placing the burden on families with limited resources to conduct their own market research and price comparisons. ESH is recommending that two percent of the available expiring High Cost funds be made available for the development of the platform and that it deliver five key components:

1. Digital Literacy Resources: The platform would make digital literacy information available to the applicant so they can make an informed choice for the plan that best fits their household’s needs. 
2. Streamlined Verification Process: Agency data-sharing agreements are crucial to streamlining the enrollment verification process and alleviating some of the administrative burden placed on households, reducing the time they must spend verifying eligibility. This process should be maintained and expanded; the marketplace would build off the National Verifier enrollment system, allowing users to quickly and easily verify their eligibility and enroll in a plan. 
3. Internet Service Plan Information: A comprehensive platform enables multiple internet service plans to be aggregated and portrayed based on the household’s location. All of these details would be displayed in a consumer-friendly manner, and broadband nutrition labels will help convey this information, leveling the playing field for smaller ISPs and ensuring parity.
4. Full End-to-End Enrollment: The consumer never has to leave the site to get the answers they need as there should be digital navigators who can answer questions and support the broader enrollment process. 
5. Accessible From a Mobile Phone: Technology dramatically simplifies the application process using user-centered design principles. With 97 percent of Americans owning a mobile phone, a mobile website is a natural place to provide enrollment support solutions.

ISPs will pay a $100 referral fee for every new customer or unconnected beneficiary acquired through the online marketplace. The fund established by these referral fees can be used to provide outreach and enrollment support to unconnected households and maintain the marketplace. 

To further ensure small and mid-size rural providers can participate in the program, the referral fee would be waived for households in high-cost rural areas that enroll via the marketplace and qualify for the $75 benefit. ESH estimates that this accounts for 6.85 percent of households eligible for the new broadband affordability benefit. These referral fees will create a self-sustaining fund of up to $40 million annually for campaigns that drive program awareness and provide enrollment support to unconnected households and hard-to-reach populations.

Quick Bits

• Ramping Up the BEAD Workforce: 5 Things States, ISPs, and Construction Firms Can Be Doing Now
• FCC Announces more Rural Digital Opportunity Fund Defaults
• Musk could use the ‘Department of Government Efficiency’ for self-enrichment
• Platforms and the Presidency: An Unprecedented Situation

Weekend Reads

• What the Trump administration might mean for the future of the bipartisan infrastructure law
• The case for investing in improved digital connectivity in Harlan County
• Chairwoman Rosenworcel's Update to Members of Congress Regarding the Secure and Trusted Communications Networks Reimbursement Program
• CBO Scores PLAN for Broadband Act

ICYMI from Benton

• Digital Equity Funding Boosts Innovative Connectivity in Indiana
• Cruz Creating Detours on the Road to Internet For All
• North Carolinians Vote for Broadband
• Arizona’s Election Results and Broadband

Upcoming Events

Dec 06––Meeting of the Communications Equity and Diversity Council (FCC)

Dec 10––Health Equity in Telemedicine: Addressing the Benefits and Challenges (Black Women's Roundtable)

Dec 10––Connected for the Long Haul: Digital Equity and Disaster (North Carolina State University)

Dec 11––December 2024 Open Federal Communications Commission Meeting (FCC)

Dec 11––Communications Networks Safety and Security (US Senate Subcommittee on Communications, Media and Broadband)

Dec 11––Broadband in the Trump Administration (Broadband Breakfast)

Dec 19––Technological Advisory Council (FCC)

Jan 15––January 2025 Open Federal Communications Commission Meeting (FCC)

Feb 11––State of the Net Conference 2025 (Internet Education Foundation)

Feb 25––The Attention Economy: Monopolizing Kids’ Time Online (FTC)

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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Benton Institute
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