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FCC Stops 9 Companies From Subsidizing Internet To Low Income Users

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Millions of broadband internet consumers just became the latest casualty of Donald Trump's blitzkrieg campaign. This came after the newly installed leadership at the Federal Communications Commission has moved to overturn a federal program that seeks to provide more affordable broadband internet to low-income families.

'Midnight Regulation'

It was announced by Ajit Pai, FCC's new chairman, last Feb. 3. He explained that the decision mainly stems from the fact that the broadband subsidy inclusion to the program, which is called Lifeline, has been a midnight regulation, passed without support from the majority of FCC commissioners.

It should be noted that when the program's expansion was put to vote in March 2016, two commissioners voted against it. You may be assured that Pai constituted one of the pair while the other was commissioner Michael O'Reilly. FCC has five commissioners.

Pai has already directed nine companies to stop selling low-cost internet plans that draw subsidy from the federal assistance program.

What Is Lifeline?

Essentially, Lifeline provides qualified low-income households with $9.25 monthly credit, which could initially be used to help pay for landline and mobile phone services. Recently, the credit has been allowed to be used to pay for home broadband internet service.

"We can recite statistics all we want, but we must never lose sight of the fact that what we're really talking about is people - unemployed workers who miss out on jobs that are only listed online, students who go to fast-food restaurants to use the Wi-Fi hotspots to do homework, veterans who are unable to apply for their hard-earned benefits, seniors who can't look up health information when they get sick," previous FCC chairman Tom Wheeler said.

The program would have provided as much as 13 million Americans access to broadband internet. Reports reveal that there is a huge gap in broadband penetration especially among senior citizens, minorities, and low-income families. As Lifeline got reversed, many consumers will now see an uptick of as much as $9.25 to their monthly internet bill.

Ironically, Pai has declared upon his appointment as chairman that closing the digital divide will be one of the signature policies of his tenure.

Affected ISPs

"I'm most concerned about the children we serve," Daniel Neal, founder of one of the identified nine ISPs, said in a Washington Post report. "We partner with school districts — 41 states and the District of Columbia — to provide educational broadband so that poor kids can do their homework."

Officials also cited that FCC is now investigating Lifeline for fraud, particularly about users purportedly taking advantage of the program to prevent waste and abuse.

It is worth noting, however, that the nine ISPs blocked from offering the subsidized broadband internet have not been involved in or investigated for any fraudulent practices.

Blitzkrieg

The Lifeline reversal is just one of several FCC policies dumped at the same time. It followed Donald Trump's preferred strategy, which effectively disorients the opposition.

Alongside Lifeline, the net neutrality rule also took a hit after the FCC invalidated its previous decision holding AT&T and Verizon guilty of violating net neutrality through the practice of zero rating.

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