OTI Responds to Several Lifeline-Related Requests

The Open Technology Institute (OTI) recently filed two comments to the FCC related to Lifeline, a Reagan-era subsidy program that low-income Americans can use to purchase telephone (and now broadband) service.

Use of Application Programming Interfaces at the Lifeline National Verifier

Q Link Wireless, LLC, filed a request with the Federal Communications Commission (FCC), asking it to ensure that the new National Verifier is set up to minimize friction in the program. Originally, the FCC planned to require the National Verifier to use Application Programming Interfaces (APIs) to facilitate first-time online applications, which would reduce friction for those applicants and give them a more seamless experience. But the FCC removed that functionality without explanation.

OTI’s concerns are two-fold: the lack of transparency around the decision to remove APIs is troubling, as transparency is necessary for consumers to trust and use the program; and the FCC has not made clear whether it will test the new consumer portal before the hard launch, which may result in significant roll-out errors that could be avoided through testing. To maximize participation and ensure all stakeholders trust the Lifeline program, these issues should be addressed. Otherwise, eligible participants may forego the program altogether, defeating the program’s purpose of connecting low-income households to affordable communications services.

Waivers for the minimum standards increases

OTI also filed comments in response to requests for waivers of the new Lifeline minimum standards. On December 1, 2018, the minimum standards for fixed broadband services that are supported by Lifeline subsidies are set to increase from 10 mbps download/1 mbps upload to 18 mbps download/2 mbps upload. In addition, the standards for mobile data will increase from 1 GB per month to 2 GB per month. And the voice minutes minimum will increase from 750 minutes to 1000 minutes. Lifeline providers filed two petitions for waivers: NTCA–The Rural Broadband Association, a trade organization representing rural carriers, sought a waiver of the minimum standards speeds increase for all its members and similarly situated providers; TracFone, a well-known Lifeline provider, sought permission to conduct a study on an alternate way to meet data and voice minutes minimum by providing its customers 2,000 “units,” which customers could put toward voice (1 unit = 1 minute) or data (1 unit = 1 MB data). (Note that TracFone has since reduced the number of units to 1,000, claiming administrative difficulties with 2,000.)

In general, OTI opposes delaying or waiving the minimum standards. However, where a case can be made that providers will exit the market if the standards increase, OTI may be sympathetic to a very narrow and time-limited waiver of future increases to further study the Lifeline market. Nonetheless, OTI opposes the waiver petition requested by NTCA. The petition alleged that speed increases necessarily come with price increases, but the petition did not demonstrate the truth of that statement; it merely asserted it. The petition also left many questions unanswered: How long of a waiver do the companies represented by NTCA need? Would accommodating the minimum service increases cause congestion in the network such that more investment in network capacity would be necessary or the providers would otherwise be required to throttle users?

OTI is open to learning more about the TracFone units proposal included in that company’s waiver petition. The units proposal would allow consumers to continue using voice service even as the voice subsidy is phased out. It would also allow customers to decide each month how they need to use their plans. However, this petition also leaves out crucial details. Why does TracFone need a year for its study? Will it provide a fully Lifeline-compliant plan while testing the units model? Will the units model be available across its entire footprint or will it be in certain markets?

The National Lifeline Association argued that the FCC should pause all minimum standards increases until it studies the market in 2021. OTI opposes such a drastic measure, but is open to considering a pause and study period if the following conditions are met: the delay should be time-limited, carriers should submit robust economic impact studies that are publicly available, and resellers should provide data about the wholesale rates they pay for network access.

Read more about OTI’s comments in response to Q Link’s petition (joined by 15 other organizations) and the minimum standards waiver petitions.