ASPEN -- Funding the Universal Service Fund (USF) through general appropriations might make sense on paper, but speaking practically it might not be a feasible goal for Congress, Democratic and Republican staffers said Tuesday.
Affordable Connectivity Program (ACP)
What is the Affordable Connectivity Program (ACP)?
The Affordable Connectivity Program was a recently expired subsidy for low-income households to lower the cost of purchasing broadband internet and connected devices. The program was signed into law as part of the 2021 Infrastructure Investment and Jobs Act and administered by the FCC up until June 1, 2024, due to expiration of the ACP’s funding.
Will the ACP Return?
Congress continues to debate restoring ACP funding, with immediate next steps likely to come from the Senate Commerce Committee or Congressional discussions on revising the Universal Service Fund.
Democratic National Convention delegates were expected to vote Monday night on the Democratic National Committee’s 2024 platform, which includes a pledge that promises the party will “keep fighting to reinstate” the FCC’s lapsed affordable connectivity program. The draft program repeatedly references President Joe Biden and his now-ended reelection bid because the DNC Platform Committee adopted it July 16, before the incumbent stepped aside in favor of new nominee Vice President Kamala Harris, the committee said when it released the document Sunday night. “23 million households received free or monthly discounts” via ACP, “saving $30 to $75 per month on high-speed broadband through the largest internet affordability program in history,” the Democrats’ proposed platform said: The program lapsed “because Republicans refused to act.” ACP's supporters are tempering their expectations that Congress will act to restore the subsidy this year despite the Senate Commerce Committee successfully advancing a surprise amendment July 31 to the Proper Leadership to Align Networks for Broadband Act (S-2238) that would allocate $7 billion to the program for FY 2024 (see 2408090041). The DNC platform references the Biden administration’s implementation of the 2021 Infrastructure Investment and Jobs Act, which included $65 billion for connectivity. “We’re bringing affordable, reliable, high-speed internet to every American household,” the platform said. “But a full 45 million of us still live in areas where there is no high-speed internet. Democrats are closing that divide.” Democrats are also “determined to strengthen data privacy,” through passage of a revamped “Consumer Privacy Bill of Rights” and an update of the Electronic Communications Privacy Act “to protect personal electronic information and safeguard location information.” The document notes Democrats' continued push to “fundamentally reform” Communications Decency Act Section 230 and “ensure that platforms take responsibility for the content they share.” It also mentions Democrats’ interest in “promoting interoperability between tech services and platforms, allowing users to control and transfer their data, and preventing large platforms from giving their own products and services an unfair advantage in the marketplace.”
ASPEN -- Finding a way to restore the affordable connectivity program (ACP) is a high priority for the end of 2024 and social media-related advertising revenue could provide potential solutions, FCC Commissioners Geoffrey Starks and Anna Gomez said Monday.
Charter Communications agreed to charge $15 monthly for a low-income broadband plan in New York state under a settlement the Public Service Commission approved Thursday, Gov. Kathy Hochul (D) said Thursday. The New York PSC in its 2016 order approving the company’s acquisition of Time Warner Cable required Charter to sell a $14.99 monthly plan with at least 30 Mbps download speeds (see 1601270028). The New York Department of Public Service alleged that Charter violated the order when it increased the price to $24.99 for 50 Mbps without PSC approval. Under the settlement, Charter will provide 50 Mbps speeds for $15 monthly for four years to New Yorkers who participate in the National Free School Lunch Program or receive supplemental security income benefits. For years two through four, Charter may raise the price only to account for inflation. The settlement is important because the federal affordable connectivity program has expired and litigation has delayed New York state’s Affordable Broadband Act (see 2408130021), PSC Chair Rory Christian said in Hochul’s news release. “The only low-income broadband requirements that currently exist in New York are the low-income program conditions in the PSC’s orders approving certain mergers. By approving this settlement, the PSC will make affordable broadband available to eligible New Yorkers in Charter's service territory while the litigation is resolved and/or federal funding for ACP is reinstated or federal broadband policy is clarified.” Hochul applauded the news. “This settlement directly benefits thousands of low-income New York families.” A Charter spokesperson said the company's "prices and speeds are competitive and affordable" in urban, suburban and rural areas, with no modem fees, annual contracts or data caps.
Don’t expect major daylight between a Kamala Harris administration and the Joe Biden White House on major communications policy issues, industry and policy experts predicted. Much focus and effort would center on defending the FCC's net neutrality and digital discrimination orders in the current federal circuit court challenges, as well as pursuing net neutrality rules, they said. Less clear would be the nature of the relationship between Harris' White House and Big Tech. The Harris campaign didn't comment. Deregulation and undoing net neutrality are considered high on the to-do list for the administration of Republican presidential nominee Donald Trump if he's elected (see 2407110034).
The FCC’s Communications, Equity and Diversity Council may lobby for affordable connectivity program funding, according to comments at Tuesday’s CEDC meeting, the second under a new charter that lasts until 2025. The CEDC has 10 months to prepare recommendations for the FCC on implementing digital discrimination rules and getting the most for underserved communities out of federal broadband infrastructure funding, Chair Heather Gate said. “We must make recommendations to the FCC directly, but we should not be afraid to make recommendations that the FCC can communicate with other agencies,” Gate said. “We may also ask the FCC to communicate our recommendations with the White House or Congress."
Internet subscriber losses due to the end of the affordable connectivity program more than offset what otherwise would have been small subscriber gains in Q2 for WideOpenWest, CEO Teresa Elder said on an earnings call Thursday as the company announced Q2 results. Elder said WOW's focus on growing its fiber footprinting in expansion markets has been paying off. The company would have added more than 300 broadband customers in the quarter if not for 5,000 ACP subscribers it lost. She said WOW expects additional ACP subscriber losses in Q3. The company ended Q2 with 485,000 high-speed data revenue generating units, down from 507,800 the same quarter a year earlier, and 71,600 video revenue generating units, down from 110,000 a year prior. Elder said WOW is seeing increased numbers of customers buying broadband buddle with YouTube TV as the cabler transitions from traditional linear service to the streaming package (see 2305150027). Elder didn't address questions about the pending takeover offer from DigitalBridge and Crestview Partners (see 2405030047). She said a special board committee is evaluating the offer.
Facing $2 billion in debt coming due in November and likely short of the cash on hand it will need to operate in Q4, EchoStar plans to use spectrum assets to raise the funding it needs, CEO Hamid Akhavan said Friday as the company announced Q2 earnings. EchoStar has more spectrum than it needs for its wireless plans, Akhavan said. But the company doesn't intend to dispose or relinquish ownership of spectrum holdings, he said. Instead, it's considering financing options that don't require selling.
Backers of resurrecting the FCC’s affordable connectivity program are tempering their expectations about how much a pair of July developments may increase Congress’ appetite for injecting stopgap funding into the lapsed initiative this year. The Senate Commerce Committee approved a surprise amendment July 31 to the Proper Leadership to Align Networks for Broadband Act (S-2238) that would allocate $7 billion to ACP for FY 2024 (see 2407310048). Former President Donald Trump earlier that month selected Sen. JD Vance of Ohio, a Republican who backed ACP funding in the face of opposition from party leaders, as his running mate (see 2407150062).
While a 5th U.S. Circuit Court of Appeals' ruling rejecting the FCC’s USF contribution methodology calls the entire USF into question, it also offers an “opportunity” for change, Joe Kane, Information Technology and Innovation Foundation director-broadband and spectrum policy, blogged Tuesday. Some experts say the case is likely headed for U.S. Supreme Court review (see 2407260044). “For years, policymakers have acknowledged the need to overhaul the USF because of its ballooning fees, potential for waste, and outdated priorities,” Kane said in a Broadband Breakfast blog: “Now, with its legal foundation in question, Congress has a clear mandate to reallocate funding to vital broadband programs like the Affordable Connectivity Program (ACP), while eliminating outdated and redundant initiatives.”