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Biden inks deal to supply low-income homes with free internet

The discounts from partnering telecoms mean no-cost internet plans for millions of Americans

The White House announced a partnership Monday with 20 internet providers to bring high-speed plans to low-income customers who qualify for federal assistance, a population numbering in the tens of millions.

While the cost of high-speed internet ostensibly registers at $30 a month under the Affordable Connectivity Program, access is effectively free for households that select these plans since participants are allotted $30 monthly internet subsidies.

“High-speed internet is not a luxury any longer, it’s a necessity,” Biden said during a speech on Monday. “In the past, $30 a month meant you had to settle for slow internet service unless you wanted to pay a heck of a lot more out of pocket. But over the last few months, my administration has worked closely with internet providers. This is a case where big business stepped up.”

On tribal lands, where the cost of internet is higher, the program provides subsidies of $75 a month, and the 20 internet providers are offering high-speed plans for the same price.

Together, the participating internet companies provide service to areas that are home to 80% of the U.S. population and 50% of the country’s rural population, according to a White House fact sheet.

More than 1,300 internet providers participate in the program and accept federal subsidies on their internet plans, but this announcement marks the first time providers will offer high-speed plans for the same price as the subsidies.

The Affordable Connectivity Program launched last year when the bipartisan infrastructure bill doled out $14.2 billion for internet and computer stipends. It was the followup to the Emergency Broadband Benefit program, a pandemic-era policy that gave low-income households $50 off their monthly internet bills.

“I think the pandemic certainly shed a much brighter light on this when, if you weren’t connected to the internet during the pandemic, you just weren’t participating in society. You couldn’t see your doctor, you couldn’t go to work, you couldn’t go to school, let alone the other things we use the internet for,” Nick Feamster, professor and principal investigator for the Internet Equity Initiative at the University of Chicago, said in an interview.

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When the program first launched, it gave low-income households funds to cover internet costs, but did not require companies to set costs at a certain price. The 20 providers agreeing to offer high-speed $30 plans are doing so voluntarily.

“We were concerned, and I think rightly so, that many providers wouldn’t have a plan that made it so that there was no cost to the consumer. We were worried that many households would still have, essentially, a copay or an out-of-pocket cost that would make getting the internet unattainable for them,” Amy Huffman, policy director at the National Digital Inclusion Alliance, said in an interview. “So, this announcement today is exciting and will provide, I think, a launching pad.”

More than 11.5 million households participate in the subsidy program today, though some researchers estimate as many as 48 million households qualify. Households qualify for the discounts if their collective income is at or below 200% of the federal poverty level, or if a member of the household participates on one of several federal programs such as Medicaid or SNAP, food-stamp benefits available under the Supplemental Nutrition Assistance Program.

Both the cost of internet access and whether carriers provide reliable broadband access in the first place are barriers to getting all Americans online.

Roughly 4 in every 10 U.S. households that make below $30,000 a year do not have internet at home or a computer or tablet, according to the Pew Research Center.

“The internet has that potential to be the great equalizer of our time, but the problem is that it is not equal at all. There are so many families and individuals who can’t access it because it’s too expensive or they can’t access it because it’s not available to them because, for the providers, there wasn’t a return on investment for them to build to this one house 20 miles down a dirt road,” Huffman said.

The infrastructure bill allocated $1 billion for building and improving internet connections across the country and is doling out $42.5 in grants for local governments to expand access to buildings that lack speedy internet connections.

Feamster said that when the U.S. started building internet infrastructure, it wasn’t seen as an essential good. Public officials are coming to see otherwise now, particularly at the local level, and are shifting their approach, thinking about how to better understand and invest in improved access for their communities.

“We’ve now found ourselves in a fairly unique situation, as far as policy is concerned, where countless dollars have been invested in the infrastructure in a certain way as a private good, and now it’s basically become essential. So we have to think about how we are going to bridge those gaps. What started out as a luxury good, where if there are gaps, well, that’s the nature of a luxury good, is now an essential good. We’ve got to work our way back from that,” Feamster said.

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More than 11.5 million households participate in the subsidy program today, though some researchers estimate as many as 48 million households qualify.