Lifeline Changes Could Be on Tap for Vote at June FCC Meeting
The FCC could be headed for a vote at its June 18 meeting on a rulemaking reshaping the Lifeline program, including providing support for Internet access, agency and industry officials said. With a light agenda at both the April and May meetings, Chairman Tom Wheeler appears likely to take on a bigger, more controversial issue in June, and Lifeline changes could be ready for a vote, the officials said.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
Other big items possible for the June meeting include an IP transition order and extending the definition of multichannel video programming distributors to include online providers trying to offer virtual cable service. Industry officials suggest the FCC also could take on follow-up items on the TV incentive auction or even privacy rules in light of an April workshop. “There are certainly some bigger ticket items, but whether they can get them ready for June, I’m not sure,” one agency official said Friday.
Commissioner Mignon Clyburn has been a leading proponent of expanding the Lifeline program and has backed launching a rulemaking before the start of the summer (see 1503130058). In an April 20 speech at NTCA she said “criticism that Lifeline does not serve its targeted audience because people already have phone service is a myth” and the FCC has a “duty to respond” when consumers are in need (see 1504200048). Commissioner Mike O’Rielly has also weighed in, though urging that the FCC first make sure the program is sound before looking to expand it. In a February blog post he offered 10 principles for reform.
"USF would certainly raise the energy level after a couple of quiet open meetings,” said Paul Gallant, analyst at Guggenheim Securities. “Coming on the heels of Title II, any discussion of expanding federal support for Lifeline will be noisy."
“Since O'Reilly has put out his own proposals, Wheeler can likely get 5-0 to issue an NPRM if he combines Clyburn's proposals with O'Reilly's proposals in one NPRM,” said Harold Feld, senior vice president at Public Knowledge. But a senior communications lawyer who represents a variety of clients said any vote on expansion of Lifeline will likely be 3-2. Wheeler wants “full-throated broadband and mobile devices [coverage], things Ajit Pai and Mike O’Rielly won't swallow,” the lawyer said.
"I think Lifeline reform is an important issue for the commission to tackle, and I'm with Commissioner Clyburn in thinking the commission should get on with it,” said Randolph May, president of the Free State Foundation. “There are measures that ought to be taken to reduce waste and inefficiencies in the program. … It seems inevitable that Lifeline will be changed to allow subsidies for broadband service, but, again, at least for me, the key is ensuring that fraud and waste are reduced to the extent possible to preserve support for what should be a true safety net for the poor."
Lifeline won't necessarily solve the adoption problem, said Progressive Policy Institute Senior Fellow Hal Singer. According a recent paper, “there are millions of folks for whom the price of broadband is just out of reach,” he said. “They estimate that a 15 percent subsidy would increase broadband adoption by 10 percent. The question is how to finance the subsidy. If you finance it in the traditional way, via a tax on broadband revenues that gets passed onto broadband consumers, then you perversely defeat the purpose of the subsidy. That is, the higher price of broadband from the new tax will discourage even more consumers at the margin to drop out of the broadband market.”
While the FCC has a light agenda for its May 21 meeting, Wheeler said in a blog post Thursday that both orders teed up for a vote are important (see 1504300049). The iCanConnect National Deaf-Blind Equipment Distribution Program has broad support, Wheeler said. “Programs are in place in all 50 states, plus the District of Columbia, Puerto Rico, and the Virgin Islands, and they are having a powerful impact,” he said. “Thousands of individuals … have been served, thousands of pieces of equipment have been distributed, and many hours of training have been delivered.” A second item extending accessibility rules for emergency alerts to “second screens,” including tablets, smartphones and laptops, can save lives, Wheeler said. “It is my hope and expectation that these new rules will enable individuals who are blind or visually impaired to more quickly respond to time-sensitive emergency situations.”