New Hampshire Pursues Affordable Broadband With BEAD

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Round-Up for the Week of October 21-25, 2024

Through the Infrastructure Investment and Jobs Act's Broadband, Equity, Access, and Deployment (BEAD) Program, New Hampshire will receive $196.5 million and will be given the opportunity to finally close the digital divide for the entire state, finishing the task undertaken with previous state and federal programs. BEAD will bring unparalleled investment in broadband infrastructure over the next five years and has tasked the New Hampshire Department of Business and Economic Affairs (BEA) Office of Broadband with bringing affordable broadband to all New Hampshire residents. In its BEAD Initial Proposal Volume 2, BEA delineates its plan to do so.

How Affordable is Broadband in New Hampshire?

For those who are unable to adopt broadband in New Hampshire, the cost of service is the number one reason for non-adoption per the New Hampshire State Digital Equity Plan. The U.S. Census’ American Community Survey finds that 8 percent of New Hampshire residents have no internet access, 6.5 percent only have a cell phone plan for internet access, and only 15 percent of households with annual incomes between $50,000 to $74,999/year have broadband internet service.

BEA conducted a statewide public survey and asked residents to indicate how much they can pay for internet service at home each month. Only 32 percent of residents indicated that they are able to pay over $100 each month for internet service, a common price point for service in the state.

Access to devices and reliable and affordable internet was universally identified as a significant barrier to broadband adoption by a number of vulnerable populations in New Hampshire. Rural populations identified a lack of access to affordable, high-speed internet as a barrier. Additionally, 68 percent of individuals over 60 years old in New Hampshire indicated that they were unable to pay more than $75 a month.

New Hampshire's Low-Cost Broadband Service Option for BEAD Networks

BEA proposes the following definition for the statutorily-required low-cost service option after full consideration of how to best advance the deployment and affordability aims of the BEAD Program. BEA’s priority is to increase awareness of and enrollment in available broadband subsidy programs—like the now-ended Affordable Connectivity Program (ACP)—while maintaining a price and performance tier option for low-income households served by new BEAD projects that meets the FCC’s definition of affordable broadband.

A low-cost service option is especially important for the more than 175,000 households that were eligible for ACP assistance in New Hampshire. Also important is the sustainability of small local providers that participate in BEAD. Assuring affordability and sustainability requires balancing the goals of mandating affordability and investing in financially sustainable infrastructure.

Therefore, New Hampshire believes that it is critical that the mandated low-cost BEAD service option be carefully tailored to address the actual affordability policy objective of the low-cost service option – specifically, that households otherwise unable to afford a connection on new BEAD-funded infrastructure will be able to do so – and not to function as a barrier to the long-term sustainability of newly deployed infrastructure by locking subgrantees into rate structures that unnecessarily harm the long-term financial viability of BEAD-funded projects and therefore deter participation by the widest range of providers.

New Hampshire adopts the low-cost broadband service option of $30, with possible exceptions of up to $50, for households enrolled in ACP or any successor or equivalent programs. The $50 "not-to-exceed rate" was determined following an analysis of small service provider rates throughout the state. Smaller providers typically experience different cost structures, which should not serve as a barrier to small providers applying to participate. Therefore, based upon a review of rates throughout the state, providers will be permitted to demonstrate a need for a higher rate, as explained further below.

• In no case may the offered rate exceed $50 as adjusted for annual inflation as described below.
• Modifications to rates may be granted based on evidence supporting the newly proposed rate:
  • Per-subscriber costs in an area indicating that the target effective rate above would be financially unsustainable; and/or
  • The impact on average revenue per user (ARPU) and total project revenue of the target effective rate above would be financially unsustainable given actual or projected subscriber adoption patterns.

If a modification request is granted, the new modified level shall remain the maximum low-cost rate for the provider for the duration of the federal interest.

This low-cost service option must be available to households enrolled in ACP (or any successor or equivalent programs) for BEAD-funded broadband serviceable locations (BSLs) in accordance with the requirements herein. BEA also strongly encourages that the same low-cost broadband service option be made available to all ACP-enrolled prospective customers across the subgrantee’s service territory, regardless of whether the location is covered by BEAD funding.

BEA will require all subgrantees to offer a low-cost broadband service option to households at BSL’s included in a subgrant project area that are eligible for or enrolled in ACP or any successor or equivalent program as follows:

• A service offering of 100 Megabits per second (Mbps) downstream, 20 Mbps upstream, and a minimum latency of 100 milliseconds.
• Is available to all BEAD-funded households eligible for and enrolled in the Affordable Connectivity Program or a successor program as modified by Congress.
• The rate specified or subsequently modified, as well as the other provisions identified in this section, for this service option will be a contractual requirement of awardees for the duration of the federal interest, as specified by the National Telecommunications and Information Administration.
• In the event that the FCC during the period of this obligation revises the federal definition of broadband to a performance level that is higher than the 100/20 standard required currently for BEAD, that new federal definition shall become the required performance standard.
• Allows the end user to apply the ACP or successor program(s) benefit to the service price and encourages customers to participate in the ACP or successor program(s).
• Is not subject to data caps, installation or other non-recurring charges, surcharges, or usage-based performance reductions, and is subject only to the same acceptable use policies to which subscribers to all other broadband internet access service plans offered to home subscribers by the participating subgrantee must adhere.
• In the event the provider later offers a low-cost plan with higher speeds downstream and/or upstream, permits Eligible Subscribers that are subscribed to a low-cost broadband service option to upgrade to the new low-cost offering at no cost.
• To make households within subgrant service areas aware of the availability of the low-cost plan via public awareness campaign activities.

Subgrantees are required to participate in the Affordable Connectivity Program or any successor program, and Eligible Subscribers who are eligible for a broadband service subsidy can apply the subsidy to the proposed service option.

Middle-Class Affordability Plans for New Hampshire's BEAD Networks

BEA is committed to ensuring that BSLs served by BEAD-funded networks have access to high-quality broadband service that is affordable to middle-class households. There is no one standard for defining either “middle class” or what broadband rate(s) should be considered “affordable,” as local costs, the size of households, and a myriad of other factors impede the development of simple definitions.

While not offered as a standard definition for affordability, a widely utilized benchmark to measure changes in broadband pricing is two percent of monthly household income. The Federal Communications Commission has used this figure as a “yardstick for charting changes,” based upon earlier research from the International Telecommunication Union (ITU). The ITU’s Broadband Commission for Sustainable Development later adopted a target of two percent or less of monthly income for broadband service, a goal shared by the Alliance for Affordable Internet.

Subsequently, the Pew Charitable Trusts published an analysis using the two percent standard to demonstrate variations of “reasonable prices” across or within states. Pew used data from the US Census Bureau’s American Community Survey to ascertain middle-class income levels to then derive a baseline of what might constitute “reasonable” prices for broadband access across U.S. regions, states, and counties.

Based on 2021 data, Pew determined that the affordable standard monthly pricing for broadband in New Hampshire stood at $123.99. The FCC’s 2023 Urban Rate Benchmark shows that fiber-based broadband services of 250 Mbps symmetrical (which exceeds BEAD’s speed threshold) typically cost $80 total in New Hampshire, including all mandatory charges and surcharges, and with no data caps. Comparatively, a slower DSL-based service of 100/40 Mbps costs $121.96. Even slower DSL speeds that do not meet BEAD’s speed thresholds, while relatively more expensive, usually do not exceed the $123.99 baseline established by Pew. By way of further comparison, one-gigabit symmetrical service over fiber typically costs $90.

Based on the Pew analysis and FCC benchmark data, it appears that most available pricing in New Hampshire may currently be considered “affordable” for middle-class households. Providers routinely offer multiple tiers of service at various pricing levels in order to meet households’ different budgetary needs.

Accordingly, rather than set a dollar figure target at this stage regarding Middle-Class Affordability, New Hampshire intends to require any subrecipient of BEAD funding to offer (at least throughout the life of the program) the same level of services, at rates, terms, and conditions to BSLs served by BEAD funding that match those offered to non-BEAD BSLs in the same market. As part of the subrecipient scoring process, New Hampshire will encourage providers to offer multiple plans, including more affordable options, to households served by BEAD networks. Subrecipients will be required to outline these plans as part of the BEAD scoring rubric to demonstrate affordability for middle-class households. Lower-cost plans will accordingly be weighted favorably as part of the scoring process.

BEA will monitor providers’ pricing plans as part of the normal reporting process through the program’s term to ensure the continued availability of affordable plans. Verification mechanisms, including review of data and the opportunity for public input so that consumers may refute any inaccurate pricing data that may be reported, shall be included in order to ensure that affordable options remain available for middle-class households for the program’s duration.

Affordability Scoring Criteria

BEAD applicants in New Hampshire should demonstrate their commitment to providing the most affordable total price to the customer for 1 Gbps/1 Gbps service in a project area. BEA will award points based on an applicant’s proposed total price, including all taxes and fees. The most affordable total price will receive the full 20 points under this criterion. Other applications will receive fewer points based on the percentage difference from the most affordable application; that is, an application that commits to a price that is 10 percent higher than that offered by the lowest-priced application will receive 10 percent fewer points (18 points, rather than 20).

Conclusion

New Hampshire's vision of digital equity is to empower New Hampshire residents to thrive by enabling access to resources, skills, and other supports needed to participate in today’s digital world. BEA's BEAD Initial Proposal, together with New Hampshire's Digital Equity Plan, offer strategies to achieve this vision and enable opportunities for all New Hampshire residents through accessible, affordable broadband.

Additional Coverage on New Hampshire's Broadband Priorities

• Equitable Participation in Today's Digital World: New Hampshire's Plan
• New Hampshire is All-In for Broadband
• New Hampshire State Digital Equity Plan
• New Hampshire Five-Year Broadband Action Plan
• New Hampshire BEAD Office of Broadband Initial Proposal Volume 1 and Volume 2

See the latest New Hampshire broadband news

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Weekend Reads

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• Barriers to Meaningful Connectivity

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Upcoming Events

Oct 29––BEAD 2.0: Maximizing Connectivity with Non-Deployment Dollars (Wireless Infrastructure Association)

Nov 12––Veterans and Digital Equity: Planning for Success (Bention Institute for Broadband & Society)

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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