Affordability/Cost/Price

A contentious battle over spectrum between the US Commerce Department and the US Department of Defense (DoD) may have finally come to an end.

Senate Commerce Committee  Ranking Member Ted Cruz (R-TX) asked New Street Research Policy Advisor and Brookings Nonresident Senior Fellow Blair Levin to clarify remarks Levin made about the negative impact the end of the Affordable Connectivity Program (ACP) will have on the Broadband, Equity, Access, and Deployment (BEAD) Program. Levin answered saying that BEAD does not fund the cost of deployment broadband to an unserved or underserved area; rather it funds the difference between the cost of deployment and what a provider would be willing to invest to serve that area.

On May 31 as funding for the Affordable Connectivity Program (ACP) expired, the White House highlighted the commitments of 14 internet service providers to offer plans at $30 or less to low-income households through 2024. These internet service providers (ISPs) collectively cover up to 10 million ACP households and are offering their current ACP subscribers and other eligible households a high-speed internet plan for $30 per month or less, with no fees and data caps, until the end of 2024. For each ISP, we are looking at what is being offered—and how easy it is for consumers to find the inf

The record shows that Affordable Connectivity Program (ACP) recipients regard using access to broadband as critical to their healthcare. A recent study found that 75% of ACP participants fear that losing access to ACP will result in losing access to healthcare. This is consistent with another large-scale survey found that 45% of adults believe that inadequate access to technology, including broadband and computers, is a barrier to telehealth, and this was especially prominent among rural residents and adults over the age of 65. That is, ACP

More than 23 million households will lose affordable internet access as part of a pandemic-era federal program that provided low-income households with a credit of between $30 and $75 toward their monthly service bill.

Starting in June, 23 million households in the US will have to make a difficult decision: pay more for their monthly internet bill or cut their budget somewhere else to pay for it or go without internet access. This is because the federal subsidy that one in six households has relied on to connect to the internet each month ran out of funds at the end of May. The Affordable Connectivity Program (ACP) has lapsed but isn’t dead yet.

I applaud private efforts to address low-income adoption, particularly Comcast’s Internet Essentials, which is the oldest and most extensive program. Comcast started the program in 2011 and has continually studied and changed the program to improve its outcomes. That is the path the Federal Communications Commission (FCC) and Congress should follow with the Affordable Connectivity Program (ACP).

The press is suddenly full of articles talking about how some internet service providers (ISPs) are offering affordable rates to low-income homes now that the Affordable Connectivity Program (ACP) monthly subsidy has died. Some ISPs are extending the $30 discount for a limited time, while others are offering more affordable broadband plans than in the past. Other ISPs are only making a nod towards affordable broadband and some aren’t giving any discounts to low-income households.

This paper hypothesizes that Affordable Connectivity Program (ACP) enrollment decisions are not solely individual, but also influenced by community-wide considerations, such as housing costs, share of occupied houses, presence of anchor institutions such as public libraries, and population density (i.e., whether a place is urban or rural). The paper develops a regression model that predicts ACP enrollment rates among eligible households at the 5-digit zip code geography as a function of the variables discussed above.

A fair reading of Dr. John Horrigan’s work would start by adopting his insight that the Affordable Connectivity Program (ACP) is part of a three-legged stool that during the pandemic helped increase broadband adoption and sustain it for low-income households.