The Biden Administration Should Increase Phone and Internet Subsidies for Low-Income Americans

OTI's Claire Park wrote for Slate Future Tense's Future Agenda series about how the incoming Biden administration could boost connectivity for those who need it most by bolstering the Lifeline program.

High service costs are a key reason why millions—including a disproportionate number of older Americans, veterans, Native Americans, Black, Hispanic, and low-income consumers—do not have home broadband. But it doesn’t have to be this way. By expanding Lifeline, the only federal program dedicated to making telecommunications service more affordable, the incoming Biden administration can help connect more people and lead the way to universal broadband access...

Currently, however, the Lifeline subsidy is not enough to cover the high cost of internet service in the United States. According to recent research from my organization, New America’s Open Technology Institute, the current $9.25 Lifeline subsidy only covers 14 percent of average monthly costs for fixed home internet service in the United States, which come to $68.38 a month. (New America is a partner with Slate and Arizona State University in Future Tense.) The subsidy is even weaker in the Navajo Nation, which has the country’s largest land area retained by an indigenous tribe, where the average monthly price for internet service is a steep $127.51. Although the tribal Lifeline subsidy is higher at $34.25, it doesn’t come even close to covering the difference in average prices for internet service in tribal versus nontribal lands.

Moreover, because the subsidy can apply to only one subscription, it does not even come close to covering the total costs a household might incur to stay connected. Subscribers are forced to choose between mobile service and home internet, even countless studies have demonstrated that mobile broadband is not a substitute for fixed broadband—a conclusion even the Trump FCC has agreed with.

The Biden administration should start by increasing the Lifeline subsidy from $9.25 to $50—and $75 for tribal users—for at least the duration of the pandemic. Enormous numbers of people are out of work, prices for broadband service are increasing, and internet in the home is more necessary than ever. But it would be even better to permanently increase the subsidy to help ensure those most in need can stay connected in both the short and long term.