Regulators expand subsidy program to bring broadband to the poor

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Federal regulators voted Thursday to expand a $1.5 billion phone subsidy program to bring broadband to the poor, recognizing the necessity of Internet access for work and education.

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In a 3-2 vote, the Federal Communications Commission approved expanding the Lifeline program to include discounts for broadband Internet service. The vote split down party lines with the panel’s three Democrats voting in favor and the two Republicans against.

The vote expands the Reagan Era program, which was designed to provide subsidized phone service to low-income households, to broadband Internet service. Starting in December, broadband providers offering discounted Internet service to eligible Lifeline customers will receive a $9.25 subsidy per Lifeline subscriber.

The vote reflects the FCC’s recognition of the Internet as a central part of everyday life and of the disadvantage for households unable to access the Net.

While almost every affluent household in the US has broadband access, just 48 percent of those earning less than $25,000 can afford such service, according to the FCC. Affordability is still the largest barrier to broadband adoption for those living in poverty, the agency says. Changes to Lifeline are expected to fix that.

“It’s a simple concept: to provide assistance so that low-income Americans can access the dominant communications network of the day,” FCC Chairman Tom Wheeler said. Eligibility is determined by other federal programs for poor or disabled Americans, such as Medicaid or the federal food stamp program.

Republican commissioners Ajit Pai and Michael O’Rielly objected to the $2.25 billion spending budget in the plan. Instead, they called for a lower budget cap that would cut off spending, rather than a mechanism that would potentially allow the FCC to allocate more money to the program. Pai also pushed for the minimum speed requirement for service to be raised to 25 megabits per second, to reflect the FCC’s definition of broadband, instead of the 10Mbps download minimum suggested by the Democrats.

The FCC’s meeting was delayed more than three hours as Commissioner Mignon Clyburn, a Democrat championing expansion of Lifeline, tried to strike a bipartisan compromise with the two Republican commissioners.

The agreement, which Pai and O’Rielly said had been finalized in the morning, ultimately fell through because the two sides couldn’t agree on the spending measures.

“I negotiated in good faith to have a budget mechanism in place that ensures millions of new households will have the opportunity to afford advanced telecommunications services,” Clyburn said. “Upon further deliberation, I concluded that such a mechanism could not fully achieve my vision of a 21st century Lifeline program.”

The FCC also voted to open for public comment, starting today, a proposal that creates the agency’s first privacy rules for Internet service providers. These rules would let consumers choose whether a broadband provider can collect and share data about them with third parties. Large ISPs, such as AT&T and Comcast, oppose the new privacy proposal.