Backers of Congress giving the FCC stopgap funding to keep the affordable connectivity program running through FY 2024 latched onto President Joe Biden's short mention of internet affordability in his State of the Union speech Thursday night to bolster that push. Biden also said Congress should pass comprehensive data privacy legislation and briefly touched on other tech policy issues. He didn't mention the House Commerce Committee's push to require TikTok Chinese owner ByteDance to divest the app for it to continue operating in the U.S., despite its supporters' rapid push to advance it (see 2403080035).
Senate Commerce Committee ranking member Ted Cruz, R-Texas, called Wednesday for Congress to substantially rein in the FCC's autonomy in setting USF spending and creating new programs amid a bicameral working group’s examination of a possible universal service revamp (see 2305110066). “Caught in a dilemma of wanting to further expand USF programs but having already maxed out the level of taxation American consumers can reasonably tolerate, the conversation at the FCC and in Congress has focused on expanding the pool of companies and products subject to” the USF contribution factor, which is effectively a “tax on the working class,” Cruz said in a paper. “This approach is anything but fair to American taxpayers: it would hide the problem of excessive USF taxation rather than fix it and ultimately make tax burdens worse by emboldening further unaccountable spending growth.” Instead, he said Congress should “take charge of defining universal service and deciding where USF funds may go.” Cruz proposes making most USF programs subject to congressional appropriations but believes “it may make sense to keep the High-Cost program within the current” funding framework “given ongoing multiyear commitments to providers.” Congress should eliminate “duplicative” USF spending, including combining the Lifeline program with the currently independent affordable connectivity program, given perceptions that the “federal government has too many broadband programs, and a poor record of coordinating them,” Cruz said. He also proposes curbing the FCC’s expansion of E-rate eligibility, citing concerns about permitting schools and libraries to use program support for off-premises Wi-Fi hot spots and wireless internet services (see 2311090028).
Many small and mid-sized internet service providers (ISP) have doubts that they will participate widely if at all in the broadband equity, access and deployment (BEAD) program. At ACA Connects' annual summit Wednesday in Washington, President Grant Spellmeyer said members are concerned "about where BEAD is headed" on project requirements and conditions. "Places like Pennsylvania have got some troubling provisions that are slowing members down," he said. "I think you're going to see wildly disparate results across the 50 states." One ISP that operates in multiple states told us it's leaning away from participating in the states with particularly onerous conditions.
Lack of trained tradespeople and onerous permitting procedures could represent major challenges to broadband equity, access and deployment (BEAD) program implementation, speakers said Tuesday at Incompas’ annual policy summit in Washington. The looming end of the affordable connectivity program (ACP) (see 2403040077) is a big wrench in the works of planned BEAD projects, said Evan Feinman, who leads NTIA's BEAD program. He said internet service providers are recalculating project costs, and many planned projects will go into the red as they receive less help covering their operating expenses.
Senate Communications Subcommittee Chairman Ben Ray Lujan, D-N.M., and House Communications Subcommittee ranking member Doris Matsui, D-Calif., voiced varying levels of optimism during a Tuesday Incompas conference (see 2403050052) about the prospects that lawmakers will be able to reach a deal on stopgap funding that will keep the FCC’s affordable connectivity program running past this spring. The FCC said in a Monday update on its wind-down of the program that it will be able to provide only “partial” reimbursements for ACP in May (see 2403040077). Sen. Marsha Blackburn, R-Tenn., and Rep. Tim Walberg, R-Mich., highlighted their ongoing interest in enacting legislation to lift or ease permitting processes in a bid to streamline broadband deployments.
The FCC released additional guidance Monday for affordable connectivity program providers as it continues winding down the program. "Absent additional funding from Congress, the ACP can only provide a partial reimbursement for May 2024," said a public notice docket 21-450. ACP providers "have the option to claim and pass on that partial reimbursement amount to enrolled households," it said: "After May 2024, the ACP will no longer support any benefits to enrolled households." Chairwoman Jessica Rosenworcel urged lawmakers to fully fund the program, saying many enrolled households have contacted the commission with concerns about losing service.
AT&T is collaborating with the FCC and other regulators in the wake of the recent widespread wireless network outage (see 2402220058), AT&T Chief Operating Officer Jeff McElfresh said during a Morgan Stanley financial conference Monday. McElfresh also confirmed that the loss of affordable connectivity program (ACP) funding won’t be a major financial hit for the carrier, while AT&T is poised to gain connections through the broadband, equity, access and deployment (BEAD) program.
Numerous ISPs believe the affordable connectivity program's demise would give them a chance to snag subscribers from competitors. In earnings calls with analysts this quarter, many cable companies and telcos also told Wall Street they don't expect to take major hits to their subscriber base if the program ends (see 2311160076). The FCC said Monday that ACP funding will run out before the end of May (see 2403040077).
An all-but-certain bid by Senate Communications Subcommittee ranking member John Thune (S.D.) to take over as the chamber’s top Republican from current Minority Leader Mitch McConnell (Ky.) is throwing uncertainty into lobbyists’ expectations for who will hold the party's subpanel leadership role in the next Congress. In the House, some Republican contenders to replace term-limited Communications Subcommittee Chairman Bob Latta (Ohio) have emerged, but the race to be the party’s Commerce Committee leader and other factors continue to cloud the subpanel sweepstakes (see 2402290054).
More than two-thirds, or 68%, of households enrolled in the affordable connectivity program "had inconsistent or zero connectivity" before entering the program, according to an FCC survey released Thursday. The survey included data from a December poll of ACP households. It said 80% of ACP households cited affordability as the reason for their lack of connectivity before the program. More than three-quarters of household respondents said losing ACP benefits would cause them to change or cancel their internet service plan. “Thanks to today’s survey data, leaders making the decisions about ACP’s future know one thing for certain," Chairwoman Jessica Rosenworcel wrote in a note, ACP is "not nice-to-have, it’s need-to-have." Rosenworcel added: "We’ve come too far to turn back now."