A Year One Update on the Infrastructure Investment and Jobs Act: Making Broadband More Affordable
Wednesday, November 30, 2022
A Year One Update on the Infrastructure Investment and Jobs Act: Making Broadband More Affordable
U.S. households pay a lot for broadband internet access service, more than consumers in the European Union pay for similar service. U.S. households pay anywhere from $50 to $70 to nearly $85 per month for internet access.
Consumer Reports examined 22,000 broadband bills and found that the median cost of high-speed internet service was $74.99 per month. Approximately half of the households were paying between $60 and $90 per month. The research also found that bills are hard to understand and make it difficult for consumers to budget and compare prices with alternative service options.
One major aim of the Infrastructure Investment and Jobs Act's broadband provisions is to make internet access service more affordable so more people can subscribe and use it. A year ago, the law's over $14 billion set aside for the Affordable Connectivity Program, which subsidizes service for low-income households, grabbed most of the headlines. But Congress also required broadband service providers to reveal more service information, including pricing, to consumers as they compare plans. And Congress took unprecedented action against digital redlining which has led to unequal broadband access due to income, race, and ethnicity. A year on, let's see how all these efforts are going.
The Affordable Connectivity Program
On December 31, 2021, the Federal Communications Commission launched the Affordable Connectivity Program (ACP), which provides a discount of up to $30 per month toward internet service for eligible households and up to $75 per month for households on qualifying Tribal lands. Eligible households can also receive a one-time discount of up to $100 to purchase a laptop, desktop computer, or tablet from participating providers if they contribute more than $10 and less than $50 toward the purchase price.
ACP replaced the Emergency Broadband Benefit (EBB) program, which was set up earlier in the COVID-19 pandemic to help people with low incomes get connected to the internet at their homes. The Infrastructure Investment and Jobs Act of 2021 appropriated $14.2 billion for ACP in addition to approximately $2.5 billion that was still available for the EBB program at that time.
Affordability is a key element of broadband adoption, especially for people with low incomes. Benton Senior Fellow John Horrigan's analysis of American Community Survey data shows substantial increases in household wireline broadband adoption from 2019 to 2021—an increase of more than twice the rate of growth compared to the 2017-to-2019 interval. Pandemic-driven initiatives to address home adoption gaps like EBB and ACP have had a positive impact, Horrigan finds. Notably, increases in home broadband subscriptions have been most pronounced in cities with higher-than-average rates of poverty.
Raising ACP Awareness and Enrollment
At the end of December 2021, just over 9 million homes were participating in the EBB. As of November 21, 2022, more than 15 million homes are enrolled in the ACP. However, a significant number of qualifying households have not yet enrolled in the program. The FCC believes that to achieve the program’s full potential and reach as many eligible households as possible, people must be clearly informed of the program’s existence, benefits, and eligibility qualifications, and how to apply. To accomplish this, on August 5, the FCC established the Affordable Connectivity Outreach Grant Program, which will provide eligible partners grant funds to conduct outreach in support of the Affordable Connectivity Program. There are four complementary grant programs:
- The National Competitive Outreach Program funds outreach activities to increase awareness of and encourage participation in the ACP for eligible low-income households. The FCC will make up to $60 million available for this program in fiscal year 2023 (October 1, 2022-September 30, 2023).
- The Tribal Competitive Outreach Program funds outreach activities to increase awareness of and encourage participation in the ACP for households on tribal lands. The FCC will make up to $10 million available for this program in fiscal year 2023.
On November 10, the FCC released a Notice of Funding Opportunity (NOFO), a formal announcement of the availability of grant funds, to develop innovative outreach strategies under the competitive outreach programs. State, territorial, local, and Tribal governments, along with public housing agencies, social service providers, community anchor institutions, workforce development training organizations, and non-profits can now apply for grants of no less than $50,000 and no more than $1 million to improve ACP awareness and increase enrollment. Activities eligible for grant support include in-person application assistance, digital campaigns, creating outreach materials, direct mailings, paid media campaigns and much more.
Applications are due January 9, 2023.
The FCC anticipates selecting grant winners before March 10, 2023 and making awards by March 31, 2023.
- The Your Home, Your Internet Program provides funding to eligible state, local, and Tribal housing agencies or non-profit organizations, community-based organizations, and tenant association partners to federal, state, local, or Tribal housing agencies for outreach activities to increase awareness and encourage ACP participation for households receiving federal housing assistance. The one-year pilot program will allow the FCC to test the best methods for helping consumers receiving qualifying federal housing assistance available through Department of Housing and Urban Development programs and administered at the federal, Tribal, regional, and local level to learn about and enroll in the ACP. Your Home, Your Internet funding will only be provided to entities that are selected to participate in the Your Home, Your Internet Pilot Program. The FCC will make up to $5 million available for this program in fiscal year 2023.
- The ACP Navigator Pilot Program (NPP) is a one-year pilot program that provides funding to support outreach activities by trusted, neutral third-party entities, such as schools and school districts or other local or state government entities, with access to the National Verifier for purposes of assisting consumers with applying for the ACP. NPP funding will only be provided to entities that are selected to participate in the ACP Navigator Pilot Program. The FCC will make up to $5 million available for this program in fiscal year 2023.
On November 21, the FCC released a NOFO for the two pilot programs which will provide governmental entities and third-party organizations with the funding and resources needed to increase awareness of and participation in the ACP among those households most in need of affordable connectivity.
Applications are due January 9, 2023.
Affordable Connectivity Program Transparency Data Collection
On November 23, the FCC adopted rules creating the Affordable Connectivity Program Transparency Data Collection, an annual data collection describing all internet service plans subscribed to by households enrolled in the ACP. In the Infrastructure Investment and Jobs Act, Congress required the FCC to collect this data for all service plans subscribed to by an ACP-enrolled household. Providers must also submit plan characteristics including speed, latency, and bundle characteristics, and a unique identifier associated with a broadband label if applicable, as well as certain aggregated plan enrollment subscriber data. ACP providers will now be required to submit annual data on price, plan coverage, and plan characteristics of their broadband internet services subscribed to by ACP-enrolled households.
At the same time, the FCC released a Further Notice of Proposed Rulemaking (FNPRM) seeking comment on subscriber enrollment data, digital divide metrics, metrics related to low-income plan and connected device offerings, and on the merits and burdens associated with the collection of subscriber level information. The FNPRM also seeks comment on whether the FCC should collect information related to the digital divide, including whether an ACP subscriber is a first-time or existing broadband subscriber or is subscribed to multiple plans. In addition, the FNPRM seeks comment on the collection of information related to providers’ low-income broadband plans and connected device offerings.
Consumer Broadband Labels
The Infrastructure Investment and Jobs Act directs the FCC to require broadband internet service providers to display, in the form of labels, certain information regarding their broadband internet access service plans. The law further provides that the labels shall make clear whether the offered price is an introductory rate and, if so, what the consumer must pay after the introductory period ends. On November 14, the FCC adopted rules requiring broadband providers to display easy-to-understand labels to allow consumers to comparison shop for broadband services. The new broadband labels will empower consumers with several features, including:
- Prominent Display. The FCC rules ensure that consumers see their actual label when purchasing broadband by requiring providers to display the label—not simply an icon or link to the label—in close proximity to an associated plan advertisement.
- Account Portals. The rules require broadband internet service providers to make each customer’s label easily accessible to the customer in their online account portal, as well as to provide the label to an existing customer upon request.
- Machine Readability. To further assist with comparison shopping, the rules require that providers make the information in the labels machine-readable to enable third parties to more easily collect and aggregate data for the purpose of creating comparison-shopping tools for consumers.
The FCC also launched a new proceeding (called a Further Notice of Proposed Rulemaking or FNPRM) on ways that it can further refine and improve its rules in order to ensure that we further consumer transparency goals. Specifically, the FCC asks for public comment on issues related to accessibility and languages, performance characteristics, service reliability, cybersecurity, network management and privacy, formatting, and whether broadband providers should submit label information to the FCC. The FNPRM has not yet been published in the Federal Register; when it is, the public will have 30 days to provide comments and an additional 30 days to comment on those filings.
Most broadband providers will have to start displaying the labels six months after the White House's Office of Management and Budget has approved the FCC's rules. Providers with 100,000 or fewer subscribers will be given an additional six months to start displaying the labels.
Preventing and Eliminating Digital Discrimination
The Markup gathered and analyzed more than 800,000 internet service offers from AT&T, Verizon, Earthlink, and CenturyLink in 38 cities across America and found that all four routinely offered fast base speeds at or above 200 Mbps in some neighborhoods for the same price as connections below 25 Mbps in others.
The neighborhoods offered the worst deals had lower median incomes in nine out of 10 cities in the analysis. In two-thirds of the cities where The Markup had enough data to compare, the providers gave the worst offers to the least-White neighborhoods.
These providers also disproportionately gave the worst offers to formerly redlined areas in every one of the 22 cities examined where digitized historical maps were available. These are areas a since-disbanded agency created by the federal government in the 1930s had deemed “hazardous” for financial institutions to invest in, often because the residents were Black or poor. Redlining was outlawed in 1968.
By failing to price according to service speed, these companies are demanding some customers pay dramatically higher unit prices for advertised download speed than others.
Digital Equity LA and the California Community Foundation Digital Equity Initiative set out to document in Slower and More Expensive: Sounding the Alarm - Disparities in Advertised Prices for Fast, Reliable Broadband what people are being asked to pay for home internet in diverse neighborhoods across Los Angeles County. The findings of the research echo The Markup: low-income communities and communities of color routinely are advertised internet service at higher prices and slower speeds than whiter and wealthier neighbors. These findings are sobering, raising significant red flags about the potential efficacy of current interventions to close the digital divide.
The monopoly provider in much of LA County is Charter Communications, operating as Spectrum. According to Charter’s filings with the California Public Utilities Commission (CPUC), it serves approximately 97% of households in the county.
- Published pricing for Charter Spectrum service shows a clear and consistent pattern of the provider reserving its best offers—high speed at low cost—for the wealthiest neighborhoods in LA County.
- People who live in higher poverty neighborhoods are not only routinely offered slower service at higher prices, but are offered contracts with worse terms and conditions. For example, Charter Spectrum’s promotional offers - guaranteeing a period of time before prices will increase - are for two years in wealthy communities, but for just one year in high-poverty communities.
- Charter Spectrum's low-cost plans are not consistently advertised to households in high-poverty neighborhoods.
The Infrastructure Investment and Jobs Act makes it the policy of the United States that:
- subscribers should benefit from equal access to broadband internet access service within the service area of a provider of such service;
- ‘‘equal access’’ means the equal opportunity to subscribe to an offered service that provides comparable speeds, capacities, latency, and other quality of service metrics in a given area, for comparable terms and conditions; and
- the FCC should take steps to ensure that all people in the United States benefit from equal access to broadband internet access service.
The FCC has until November 2023 to issue rules to facilitate equal access to broadband internet access service, including: preventing digital discrimination of access based on income level, race, ethnicity, color, religion, or national origin; and identifying necessary steps for the FCC to take to eliminate such discrimination.
In December 2021, the FCC asked its Communications Equity and Diversity Council to (a) examine issues around lack of access to broadband services and products; (b) help better understand the reasons and causes for such lack of access; and (c) offer recommendations for addressing digital discrimination and other barriers that impact equitable access to emerging technology in the U.S., including its territories, particularly in communities that remain unserved, underserved or “under-connected.”
On November 7, the council released Recommendations and Best Practices to Prevent Digital Discrimination and Promote Digital Equity, with more than two dozen suggestions for a series of model policies and best practices that can be adopted by states, localities, and broadband providers working to promote equitable broadband deployment while preventing digital discrimination. The report also includes a series of other considerations to advance digital equity, including increased community engagement and K-12 digital skilling, among other action items. The council said states and localities should seek to prevent “digital discrimination” based on income level, race, ethnicity, color, religion, or national origin to the extent they have the authority to do so.
In March 2022, the FCC released a Notice of Inquiry (NOI) to establish "a shared understanding of the harms experienced by historically excluded and marginalized communities" and to provide "a grounding for meaningful policy reforms and systems improvements, as well as a framework for collaborative action to extend digital opportunity to everyone." The FCC sought comment on the meaning of relevant terms and concepts and how they should be applied in ensuring equal access to broadband, preventing digital discrimination, and identifying steps the FCC should take to eliminate digital discrimination.
The FCC has not yet moved from an NOI to a formal rulemaking process.
In addition to adopting rules to eliminate digital discrimination, the FCC and the U.S. Attorney General will ensure that Federal policies promote equal access to robust broadband internet access service by prohibiting deployment discrimination based on:
- the income level of an area,
- the predominant race or ethnic composition of an area, or
- other factors the FCC determines to be relevant based on the findings of its rulemaking.
The FCC will develop model policies and best practices that can be adopted by states and localities to ensure that broadband internet access service providers do not engage in digital discrimination.
Finally, the FCC will revise its public complaint process to accept complaints from consumers or other members of the public that relate to digital discrimination.
More in this Series
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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