Internet Bills to Increase For Millions of Americans

Internet Bills To Increase For Americans

Internet service fees are set to rise for 23 million American households after the Biden administration’s request for the continued funding of the Affordable Connectivity Program (ACP) fell on deaf ears in Congress.

The program had been allocated $14.2 billion as part of the Bipartisan Infrastructure Law passed in November 2021, and provides discounts on monthly internet bills to low-income and rural households. However, the Federal Communication Commission (FCC) recently warned that it was running out of money.

In October, the Biden administration requested an additional $6 billion from Congress to keep the ACP going until December this year. But with House leadership struggling to get its own appropriation bills passed, the call has yet to be answered.

In a letter to legislators on January 8, FCC chairwoman Jessica Rosenworcel said that “if Congress does not provide additional funding for the ACP in the near future, millions of households will lose the ACP benefit that they use to afford internet service.

“This also means that roughly 1,700 internet service providers will be affected by the termination of the ACP and may cut off service to households no longer supported by the program,” she added.

On February 8, new enrollments on to the program were frozen due to a lack of funding, and the FCC said coverage under the ACP was set to end in April.

However, the seemingly likely end of the ACP is not because there is a lack of bipartisan support for extending it.

“It does not look like it will be done, but I think it should be clear that if a bill were to go to the House floor to extend ACP, it would pass,” Blair Levin, a senior fellow at Brookings and a former FCC chief of staff, told Newsweek.

“There are 15 Republican co-sponsors today [Friday] of the ACP extension bill—meaning the only reason it’s not going to pass the House is because the Speaker will not let it on the floor,” he said. “A minority of the House has decided we should not have it; it’s not a majority, and there’s a lot of political support for the extension.”

Newsweek approached the House Speaker’s office via email for comment on Friday.

In an increasingly interconnected world, the loss of affordable internet connections for millions of households is expected to impact individuals’ lives and livelihoods, and widen the digital divide in America at a time when the president has sought to close it.

An October study of 1,600 U.S. adults participating in the program by consultancy BSG found that 65 percent fear losing their primary source of income without the ACP discount, which rose to 67 percent among those in rural areas and parents with young children.

Three-quarters of the respondents worried about losing access to health care services, while 81 percent of parents expressed concern that their children could fall behind in their learning. Some 77 percent of military families—who account for around half of the households enrolled in the ACP—were worried about losing contact with friends and family.

Levin said that though it was not certain that some people would lose their job because they could no longer afford their internet connection, “the fears that were expressed by respondents were very realistic fears.”

“I think some people will say, ‘yeah, but if they’re really going to lose their jobs, they’ll come up with the $30 or the $20 or whatever’—and I think that reflects on a misunderstanding on what it is to be low-income,” he said.

While the public and policymakers tended to see broadband subscriptions as something households either had or did not, “about 50 percent [of households] on the ACP have been both on and off broadband, because if you’re low-income, you have variable income, and [so] some months you can afford it and some months you can’t,” Levin added.

The program is also arguably value for money when it comes to its impact on the economy. A February academic paper by researchers at George Mason University in Virginia estimated that for every dollar spent through the ACP, $3.89 was added to the U.S. GDP.

Research even suggests that affordable broadband access increases employment rates and individual earnings, driven by greater workforce participation. Some 78 percent of ACP participants polled by BSG said their internet connection was important in helping them find better-paid jobs.

While the program provides a discount that low-income households will lose, the higher prices are expected by industry insiders and officials to lead to many losing their internet connection altogether as they can no longer pay service bills. Some 95 percent of respondents to October’s survey said they would struggle with the additional costs if funding was cut off.

There is evidence to suggest that this could not only have an impact on access to health care, but also lead to an increased cost to the government, with telehealth appointments costing 23 percent less than in-person visits and halving emergency department visits among veterans.

On Monday, the White House renewed its call to continue funding the ACP, with senior adviser Tom Perez telling reporters that for the president, the “internet is like water” in that “it’s an essential public necessity that should be affordable and accessible to everyone,” according to ABC News.

“Just as we wouldn’t turn off the water pipes in a moment like this, we should never turn off the high-speed internet that is the pipeline to opportunity,” he added.

When the winding down of the program was first announced in January, Broderick Johnson, executive vice president for public policy and digital equity at Comcast, wrote in support of not only continuing the ACP but expanding it to more Americans, describing it as “well worth the investment.”

“If we fail, in this historic moment, to reach the tens of millions of more Americans who don’t yet use the internet at home, then our collective future is at risk,” he said. “That’s why closing the digital divide must remain at the top of our country’s priority list.”

When approached by Newsweek on February 6 with questions about how many interned customers it expected to lose, and whether the company—which made $37.6 billion in profit last year—would be willing to offer a similar discount itself, Comcast did not respond.

Levin noted that some internet service providers, like Comcast, had created low-cost subscription services of their own volition, but said that while “there are certain basic necessities that we have, I think, collectively decided are the obligation of everyone,” it was unusual to require a private entity to bear the same costs for those basic services as the government.

He added that even though there were good economic reasons for providers to offer low-cost services, in general, a “company tries to optimize profit, not maximize market share.”

Critics might argue that the ACP had flawed eligibility requirements, but Levin argued that many government programs had flaws—especially those in their early years—and “as long as we don’t cut off millions of people” those issues could be fixed with interventions from lawmakers.

There may also be hesitance among those who do not see internet access as a basic necessity to provide potentially indefinite government funding for it. Yet if, as academic research suggests, it improves the economic situation of low-income households, at some point it would help many currently on it to no longer need the discount.

An FCC spokesperson directed Newsweek to its recent statements on the issue. The White House was also contacted via email for comment.

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