FCC Introduces Internet Subsidy for Low-Income Families

by Matt Klassen on June 1, 2015

Like basic telephone services before it, the Federal Communications Commission believes that Internet access should be available to everyone, regardless of income or social standing. To that end, the Commission announced late last week that it will be extending a government phone subsidy program—one that currently helps low-income families afford landline and mobile telecommunications services—to include broadband access as well, meaning that for the estimated 12 million Americans who depend on the program, the Internet is no longer an unattainable dream.

The FCC is expected to vote on the proposal on June 18th, the beginning of the process to revamp the subsidy program, called Lifeline, which has assisted low-income families in accessing telecommunications services for the last 30 years. While it doesn’t seem that the FCC will have the program’s $1.7 billion budget adjusted, the Commission will give recipients the choice of how to use the subsidies available to access broadband, or phone services, or both.

Simply put, while the tech and telecom industries brainstorm about how to connect the as-of-now unconnected billions, the FCC believes it’s about time we worried about our own unconnected masses, finding ways to help low-income families join the digital age.

“As communications technologies and markets evolve, the Lifeline program also has to evolve to remain relevant,” Wheeler said in a blog post. “Broadband is key to Lifeline’s future.”

While the ubiquity of broadband access may lead many of us to believe that Internet access is simply available to everyone, such is not the case. In fact, household income is still the key determining factor as to whether or not people have access to broadband services.

The FCC estimates that 95 percent of households with an income of $150,000 have Internet access, but less than half of households where the income is lower than 25,000. Simply put, Internet access is a staple for the rich, an unattainable luxury for the poor.

As a Reuters’ report explains, “The subsidy is currently available to households with an income at or below 135 percent of the federal poverty line, or receive federal assistance through other programs such as food stamps or Medicaid.”

The program is funded through fees collected from landline and mobile subscribers, and offers low-income households $9.25 per month to assist with communications expenses. As mentioned, while no increase in the funding cap has been proposed, what the FCC is now doing is allowing recipients to use the subsidy for both phone and broadband services.

While many of you might agree that Internet access should be made as widely available as possible, it should really come as no surprise that there stands significant opposition to what, in recent years, has been labelled “Obamaphone,” with many conservatives arguing that Democrats have used “Lifeline” to offer free mobile phones to the poor in exchange for votes…despite the fact that initial program was instituted during the presidency of Republican Ronald Reagan.

Although it’s likely the Canadian socialist in me, I, for one, have to wonder if the subsidy is actually enough, particularly if we, as a society, find value in having everyone, from all social strata and income brackets, participating in the social exchange communications technology currently provides. All I really know is that for the most part the readers here probably have little idea what it’s like to have to have to make $10 cover both phone and broadband service…I know I don’t.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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