Broadband-centric Lifeline proposal gets mixed response from commissioners, trade groups

FCC Chairman Tom Wheeler and Commissioner Mignon Clyburn laid out their plans to extend the Lifeline social program for basic Internet service to support broadband speeds.

Under the proposal, the FCC said that Lifeline customers would be able to get financial support for either a mobile or wireline voice plan as well as broadband.

Wireline broadband services would offer at least 10 Mbps and 150 GB per month, while mobile data plans would start at 500 MB per month of 3G data, increasing to 2 GB per month by the end of 2018.

Lifeline support for standalone mobile voice will be gradually phased out over three years, from $9.25 per month to $7.25 in December 2017, $5.25 in 2018 and no support after December 1, 2019. Mobile voice service would remain eligible for full support as part of a mobile voice and data bundle.

The FCC proposal reorients Lifeline for the broadband era and sets minimum service standards for voice and broadband. By streamlining the Lifeline program's rules and dropping outdated regulations, the FCC said it will give broadband providers a good business case to take part in the program.

Additionally, the FCC will create a third-party National Eligibility Verifier platform to curb waste, fraud and abuse.

Wheeler said in a blog post that one of the reasons why low-income residents don't subscribe to a broadband connection is the cost -- and the Lifeline update will help with that issue.

"Only half of the nation's households in the lowest income tier subscribe to broadband," Wheeler said in a blog post. "And 43 percent of all people who don't subscribe to broadband at home say that affordability is the reason. Of the low income consumers who have subscribed to mobile broadband, 44% have to had cancel or suspend their service due to financial constraints and for those whose only access to the Internet is their smart phone, 48% have had to cancel or shut off service for a period of time due to financial hardship."

Perhaps not surprisingly, the FCC's lifeline proposal has garnered mixed responses amongst other commissioners and industry groups.

FCC Commissioner Michael O'Rielly has cited concerns over parts of the proposal, including one that called for increased spending on the Universal Service program to $750 million. He also wondered whether other commissioners would get their say on the topic.

"It's impossible to tell whether the "budget mechanism" is actually a budget in any real sense of the word," O'Rielly said in a statement. "It is unclear what 'Commission action' would take place when spending gets close to the amount specified -- would the full Commission get a vote?  And what is the rationale to justify increasing spending on this Universal Service program -- but not others -- by $750 million, an increase of 50%?  These are the answers I will be looking for as I review the Order." 

While a number of groups like the Communications Workers of America (CWA) cited support for the proposal, others groups like CTIA took issue with raising service prices and eliminating support for wireless voice services.

"We are, however, concerned that by dictating service offerings, the FCC will increase costs for consumers and put the 21st Century out of reach for millions of low-income Americans," said Scott Bergmann, assistant VP of regulatory affairs for CTIA, in a statement. "We are also troubled by the proposal to eliminate support for wireless voice services while continuing to fund wireline voice, which ignores the cord-cutting trend that has taken hold across the nation. A reform effort that raises barriers to pro-consumer wireless services and drives users to solely landline offerings is counter to the needs of low-income Americans."

For more:
- see this FCC blog post

Related articles:
Windstream says FCC's mobile broadband testing should mirror wireline broadband
Lifeline broadband proposal gets mixed response from state and local leaders
FCC Chairman Wheeler unveils $1.7B plan to extend broadband to the poor
Fla. telephone company owners accused of bilking $32M out of Lifeline program
FCC claims Lifeline program reforms will save $2 billion by 2014

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