Biden Administration Strikes Deal with Broadband Companies To Subsidize Low-Income Service

The deal will mean roughly 48 million US low income households could qualify for completely free high-speed internet courtesy of the Federal Government.

The White House said Monday that 20 internet providers have agreed to provide discounted service rates to low-income individuals as part of a program that could make internet free to millions of households through an already established federal subsidy. 

Twenty broadband providers have agreed to partner with the Biden Administration to offer lower-cost high-speed internet service for low-income Americans to help address the digital divide, the White House announced Monday.

The Affordable Connectivity Program will offer plans for $30 a month that provide download speeds of at least 100 megabits per second download speeds. Roughly 48 million Americans are expected to qualify for the program, or nearly 40% of households in the country, according to the White House.

President Joe Biden talked a lot during his presidential campaign about the necessity of broadband service, especially in light of the COVID-19 pandemic, which forced millions of Americans to access work and school remotely. He often talked about parents with school age children, who during the shutdowns, would park their cars in fast-food restaurant parking lots to access Wi-Fi in order for their children to go to school online.

“High-speed internet service is no longer a luxury — it’s a necessity,” the White House said in its fact sheet introducing the agreement with the broadband carriers. “But too many families go without high-speed internet because of the cost or have to cut back on other essentials to make their monthly internet service payments.”

The Affordable Connectivity Program is part of the $1 trillion Infrastructure Investment and Jobs Act, which carved out $65 billion to connect Americans to broadband. While the majority of the funds will be given to states and territories to build broadband infrastructure where it doesn’t yet exist, the law also allocates $14.2 billion to create a subsidy program to lower the cost of service to ensure greater access to broadband.

The Federal Communications Commission administers the program, which provides qualifying households a $30 per month discount on their monthly broadband bill. Households on tribal lands can get a $75 per month subsidy. Enrollees can also access a one-time $100 stipend to purchase a computer or tablet to access the internet.

The FCC says that roughly 11.5 million households have signed up for the monthly subsidy. The program is available to households whose income is 200% or less than federal poverty guidelines or for those that qualify for a government assistance program such as Medicaid, Supplemental Nutrition Assistance Program or federal Pell Grants.

Now as part of that program, the participating internet providers, which includes national carriers like AT&T, Comcast and Verizon, as well as regional companies, such as Hawaiian Telecom and Jackson Energy Authority in Tennessee, will offer a $30 plan that will provide at least 100 Mbps downloads. This is significant because it means that low-income families, that qualify for the subsidy will be able to sign up for a service that will fully meet their broadband needs and will be fully covered by the federal subsidy, according to the Biden administration.

With 100 Mbps downloads, a typical family of four could work from home, do schoolwork, browse the web and stream high-definition shows and movies, the White House said. The $30 price tag will also include all fees and there will be no data caps on the service, according to the fact sheet from the White House.

As an example, Verizon previously offered its 200 Mbps Fios service for $40. Now it will offer that service for $30 a month for households qualifying for the ACP, which means the subsidy will cover a recipient’s entire broadband bill.

The administration will soon launch the website to allow people to sign up and find participating providers. The FCC and other federal agencies along with states and cities and local community partners will work to promote the program.

Expanding access to high-speed internet across rural and low-income areas was a campaign promise made by then-candidate Joe Biden, as well as a key point of emphasis during his push for the passage of the infrastructure bill. Throughout and especially during the pandemic, the need for consistently reliable Wi-Fi access for families was underscored as children switched to remote learning. 

Implementing the program has reportedly been a challenge because contacting people who don’t have internet service has been difficult.

On Monday, President Biden and Vice President Kamala Harris are meeting with telecom executives and lawmakers, among others, to bring attention to their effort to expand access to high-speed internet for low-income Americans households. 

“High-speed internet service is no longer a luxury – it’s a necessity. But too many families go without high-speed internet because of the cost or have to cut back on other essentials to make their monthly internet service payments,” reads a statement from the White House.

Creating digital equity also means ensuring that broadband service is affordable for all Americans, regardless of whether they live in rural parts of the country or urban or suburban areas.

“Lowering prices — including the cost of high-speed internet service — is President Biden’s top priority,” the White House said. “The Biden-Harris Administration is grateful for the efforts of these companies, and encourages additional internet service providers to join this effort to close the digital divide by offering high-speed, low-cost plans.” ✪

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