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In recent years, broadband Internet access service has become essential for Americans to participate in economic life and society. Although most Americans subscribe to some type of Internet service, low-income households adopt broadband at significantly lower rates than those with higher incomes. Less than half of households with incomes below $25,000 per year have broadband service, while 95 percent of those earning over $150,000 have access. As a result, families who are already economically disadvantaged are falling farther behind.
To address this problem, the Federal Communications Commission has proposed to update its Lifeline program to include broadband Internet access. Updating Lifeline to support broadband adoption will help make Internet access more attainable for families on the wrong side of the digital divide. Public Knowledge supports the Commission’s proposal and has filed comments urging the FCC to move forward with its plan.
Universal service has long been a national priority. Since its creation in 1985, the Lifeline program has helped low-income households access basic, essential telecommunications services. Originally, Lifeline supported fixed voice service, but as Americans migrated to mobile networks, the program was updated to support mobile voice service. Lifeline’s effectiveness is evident by the fact that the telephone adoption gap between low-income households and more affluent households has narrowed from 12 percent to 4 percent since the introduction of Lifeline. In 1984, 80.1 percent of low-income households had telephone service, and by 2013, that number was over 92 percent.
Today, broadband is an essential service; Americans increasingly rely on it for education, employment, health care, access to government and social services, news and information, and commerce.
Affordability is a significant barrier to low-income adoption. Low-income families and the unemployed often cite cost as the reason they don’t subscribe. Modernizing Lifeline to support broadband will help address this problem, and doing so will narrow the adoption gap between low-income households and more affluent Americans, advancing the goal of universal service.
To improve the affordability and availability of broadband service to low-income households, Public Knowledge has advocated for the Lifeline benefit to reflect the cost of modern telecommunications services. The current Lifeline subsidy (which the FCC proposes to continue) is $9.25 per month, and the average cost of broadband service is over $47 per month. To help more Americans get online, the FCC must ensure this subsidy is enough to put access within reach for low-income consumers. Additionally, Lifeline should not be restructured in a way that will result in eligible households being turned away. The program is intended to help those in need; denying benefits to eligible families only exacerbates their economic distress.
We have also urged that the updated Lifeline program promote consumer choice, flexibility, and program efficiency. Beneficiaries should be permitted to apply the Lifeline subsidy to the service that best meets their needs—whether that is broadband or voice service, fixed or mobile, standalone or bundled. Crucially, Lifeline should continue to support voice service; millions of Americans still rely on basic telephone service.
Further, the Lifeline benefit should be portable, allowing beneficiaries to subscribe to the service that best meets their needs. Portability should promote competition between carriers, leading to better services and rates for customers and greater value for universal service contributors.
The Commission should also take steps to increase participation and competition in Lifeline program. Additionally, Lifeline should be innovative and promote the use of unlicensed spectrum to serve beneficiaries. Finally, while modernizing Lifeline for the 21st century, the Commission must protect the integrity of the Lifeline program and the dignity of Lifeline subscribers. The Commission can accomplish both tasks by establishing a national eligibility verifier and making certain that Lifeline customer information is properly secured.
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