Casting an Internet Lifeline to Low-income Americans

Blog Post
April 14, 2016

Since the earliest days of the Internet, there has been a digital divide. If you are Black, Latino, or American Indian, or if you didn’t graduate from college or are above the age of 65, you are historically less likely to have access to broadband Internet. According to new data from the National Telecommunications & Information Administration (NTIA), that inequality is “slowly shrinking.” In a blog post, NTIA writes that Internet use rates for groups that have historically fallen behind–like seniors, people without college degrees, and people of color–inched up in 2015.

But Americans’ Internet prognosis isn’t coming up all roses just yet: Compared with the demographic groups with the highest Internet use (Whites, Asians, the college-educated), there are still double digit disparities in the likelihood that African Americans, Latinos, and people over the age of 65 are able to get online. Access gaps by educational attainment remain large: only 58 percent of those without a high school diploma reported going online, compared to 88 percent of those with college degrees. The NTIA analysis echoes findings from the Federal Communications Commission’s 2016 Broadband Progress Report, which noted lackluster broadband deployment, and research by the Pew Center, which also shows overall home broadband adoption plateauing or in a slight decline.

Earlier this month the White House outlined goals to connect 20 million more Americans to the Internet by 2020, but what exactly will it take to reach Americans still without connectivity?

Given the ascendancy of the Internet in many of our daily lives, the fact that millions of Americans still live without the Internet can feel absurd. How would your life change if you woke up tomorrow without email? Or Google Maps? Without the Internet, how would you file your child’s FAFSA, or learn that your office was closed for inclement weather? Given that Internet communications are now essential to participation in our society, the time is ripe for policy intervention to close a digital divide harms school children and presents a drag on our economy.

And cost is a major barrier to access. US broadband prices are notoriously high compared with peer countries in Europe and Asia, and 60 percent of broadband Internet non-users say high cost is a major challenge to getting access. The FCC took important steps last month to address this barrier for low-income households–unfortunately, there is now an attempt in Congress to diminish them.

At its March Open Meeting, the FCC adopted a proposal to update Lifeline, a Reagan-era program that was originally designed to provide “a ladder out of poverty” through subsidized access to phone service. Recognizing the changing landscape of modern communications technology, the FCC updated the program to include broadband as an eligible service. In an Order that culminated months of an open comment period, Lifeline recipients will soon be able to put their $9.25 monthly household subsidy towards standalone broadband service, in addition to bundled voice and broadband plans.

The FCC’s plan to “reboot” Lifeline also includes minimum service standards to ensure that Lifeline customers get access to high quality Internet, as well as measures to streamline enrollment and strengthen competition among Lifeline service providers. For home, or “fixed” Internet service plans, speeds have to be comparable to what the majority of customers receive (right now, 10 Mbps download/1 Mbps upload), and at least 150 GB of uncapped use.

True to its original intent, Lifeline is geared to serve those Americans least likely to have Internet access, but with the most to gain from it. In order to be eligible for the Lifeline subsidy, a customer must be at 135% of the poverty line, $32,000/year for a family of four, or participate in a select number of assistance programs.

A modernized Lifeline is far from a silver bullet. The program only defrays the cost of broadband service (the subsidy is slightly less than the monthly cost of the cheapest of currently-available broadband plans, Comcast’s $9.95 Internet Essentials program, which was created as a condition to Comcast’s 2011 merger with NBC Universal), so we hope that more broadband plans become available at or very near to the subsidy amount. The Commission’s plan also does not specifically address the issue of handset or device costs, nor is it clear whether it will support other important mechanisms to improve broadband adoption, such as digital literacy training. Years of work by the FCC and public interest groups (including by OTI) went into the FCC’s order, and the proposal’s adoption will only kick off many more months of efforts to effectively implement the plan.

Roadblocks are already coming up. Less than two weeks after the FCC adopted its Lifeline order, Rep. Austin Scott introduced H.R. 4884, “the Controlling the Unchecked and Reckless Ballooning of the Lifeline Fund Act (CURB Lifeline).” This bill seeks to cap Lifeline’s budget and cut $750 million from the FCC order—even if doing so would exclude eligible families from participating. In the words of one public letter, undersigned by a number of civil rights advocates, opposing the bill, “[p]assage of H.R. 4884 would undercut both the goals of the Lifeline program and the principles for Lifeline modernization.“ 

The FCC’s actions on Lifeline are historic. By lowering the barriers to Internet access, the FCC’s proposal will help low-income Americans complete school work, get health care, and apply for college and jobs. A modern Lifeline may be but one small piece of closing the digital divide, but the Commission deserves great support in tackling this important issue. Politics must not distract from efforts to close the digital divide.