The Path to Broadband Affordability
Broadband has become an essential service in the daily lives of 21st century consumers. The COVID-19 pandemic has thrown this fact into sharp relief. Individuals work from home, children attend virtual classrooms, and loved ones receive medical care via telehealth services.
A survey from Consumer Reports revealed that four out of five Americans agree that internet service is “as important as water or electricity.” When asked how often they used the internet, 82% of Americans responded that they’re online every single day. But unlike water, electricity, or even phone service, broadband internet service is not universally available.
Millions of Americans are being left behind because they simply can’t afford access. In fact, U.S. broadband service is among the most expensive in the world! This high cost forces many to choose between feeding their families and getting or staying connected.
Congress should take the following steps toward greater affordability:
Provide a $50 per month subsidy to low-income families: Congress included a $50 broadband subsidy in the most recent COVID-19 relief package, but the need for broadband and its lack of affordability will continue beyond the pandemic. Americans are paying an average of $66-per-month for internet service, so the Lifeline program, which provides $9.25 a month for broadband access for low-income Americans, simply cannot support the connections families need. Offering a subsidy would also incentivize broadband deployment, because it would make low-income areas more profitable to serve.
Require internet service providers to offer an affordable option: Congress should require broadband providers, particularly those receiving federal funding, to offer an affordable “basis service” package with affordable, reliable broadband at speeds that are required for today’s bandwidth-heavy applications.
Subsidize devices like computers and tablets: Twenty-one percent of non-broadband users cite the cost of a computer as one of the reasons they don’t have broadband at home. Congress offered a device subsidy before in a COVID-19 relief package, and should include it in their long-term plan to tackle broadband affordability.
Enforcing price transparency requirements: ISP pricing varies from neighborhood to neighborhood within the same city, and there’s no clear sense how prices are determined or if they’re consistent. Fees and equipment rentals are often a surprise to consumers. and can add an additional 75% to the monthly cost of internet service. Congress should make sure this pricing is transparent.
Incentivize competition: Most Americans have at most two options for a broadband provider and 35% only have one option. Studies show that prices for bundled packages with high-speed internet connectivity are about $25 higher per month than they should be due to lack of competition. Congress needs to prioritize greater competition among ISPs, which will be beneficial for the cost of broadband long-term.