FCC Politely Tells ISPs To Stop Abusing Covid Broadband Relief Program To Rip Off Poor People

from the yeah-maybe-stop-doing-that dept

During the COVID crisis the FCC launched the Emergency Broadband Benefit (EBB program), which gives lower income Americans a $50 ($75 for those in tribal lands) discount off of their broadband bill. Under the program, the government gives money to ISPs (not exactly ideal given the industry's history of fraud), which then dole out discounts to users if they qualify. But (surprise), many found that big ISPs erected cumbersome barriers to actually getting the service, or worse, actively exploited the sign up process to force struggling low-income applicants on to more expensive plans once the initial contract ended. Very on brand.

The program was recently renamed the Affordable Connectivity Program (ACP) and made permanent via the infrastructure bill, albeit at a reduced discount rate of $30 a month (still $75 on tribal lands). And because the reboot requires new rules, the FCC has proposed tightening up the rules surrounding the program to ensure the large predatory ISPs don't exploit it to make an extra buck. More specifically, the FCC says ISPs will be required to offer the discounts across all tiers, including legacy and "grandfathered" (older, possibly cheaper plans that they may not sell any more) plans:

"We also do not think that Congress intended to exclude consumers on existing legacy or grandfathered plans from participating in the Affordable Connectivity Program. We further clarify that the requirement that legacy or grandfathered plans be eligible for reimbursement does not require that providers offer such legacy or grandfathered plans to other customers, including ACP-eligible customers, that are not already on such plans."

Basically, big ISPs were claiming that it was too technically cumbersome to provide a $30 discount to plans they no longer actively sold. Consumer groups argued this was bunk, and this was the industry's way of tap dancing around the fact they were using a program designed to help the poor as an opportunity to upsell users (like that time Verizon Wireless tried to first throttle, then upsell, firefighters battling historic wildfires). This behavior is just who they are. It's in their DNA after decades of being government-pampered regional monopolies that face little real accountability.

Note this is still just an FCC proposal, and will still require a vote of approval from an FCC that remains intentionally gridlocked at 2-2 commissioners. It also bears repeating that you wouldn't need proposals like this if Congress and U.S. policymakers were willing to target the real cause of high broadband prices across the U.S.: regional monopolization, and the state and federal corruption that protects it. But we don't, so we get these band-aid proposals big ISPs try to exploit that don't cure the underlying disease.

That's not to say this EBB/ACP program isn't helping. Over 9 million homes are enrolled in the program (a total that would be higher if ISPs didn't make the application process so cumbersome). And I've talked to several communities deploying their own gigabit fiber in the last month who say they're first targeting low-income areas as part of their broader projects, where many struggling users will see bills close to $0 per month for gigabit broadband once the discount is applied. If you're a struggling low-income American trying to survive during COVID, that's a big deal.

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Filed Under: broadband, covid, discounts, ebb, emergency broadband benefit, fcc, upselling
Companies: at&t, comcast, verizon

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  1. icon
    James Burkhardt (profile), 12 Jan 2022 @ 9:23am

    I've read position statements from both sides, and it seems the ISPs are trying to claim they have to manually adjust the service rate for every plan.

    Rather than, you know, jsut offering a line item discount that can easily be slipped on to any bill. Using mechanisms they absolutely already have to provide statement credits. Because they have those right? They have a way to correct billing errors? Or did they intentionally build a system where every adjustment is bespoke and requires building an entirely new plan in an effort to confuse and shortchange consumers?

    I said it with broadband maps, and I'll say it with this billing issue. This shouldn't be an issue. In a healthy market, Comcast would have used the pre-existing postal address database that started popping up decades ago and some manpower to index every home that can be connected or passed. I continue to be baffled that comcast can claim to know exactly how many homes it 'passed' for a broadband deployment, but not how many were actually connected. There is no reason a robust computerized billing system couldn't setup a flag on a customer account for billing subsidies. That flag both triggers the discount, and adds itself to reporting they use to claim the subsidy. The discount isn't a part of the plan, the discount is a part of the customer. Basic OOP! You don't add a discount to the plan, thats stupid. The plan isn't cheaper. The bill is. The discount shouldn't ever require identifying legacy service plans.

    reply to this | link to this | view in thread ]

  2. identicon
    Anonymous Coward, 12 Jan 2022 @ 10:08am


    When I worked in energy supply, every billing adjustment was bespoke. It was an absolute NIGHTMARE when we discovered just how many thousands per year "Smart" meters were regularly overbilling our customers by....

    reply to this | link to this | view in thread ]

  3. icon
    Ceyarrecks (profile), 12 Jan 2022 @ 10:31am

    Rush-hour Traffic

    ... in the near-deafening din of rush-hour traffic, you hear someone delicately whispering,..."no, no, do not do that,... do not run into traffic,... no, no,..." as the speaker distractedly pages through their magazine.

    GUESS how effective either situation will be to divert said expected events.

    reply to this | link to this | view in thread ]

  4. icon
    n00bdragon (profile), 12 Jan 2022 @ 11:09am

    Subsidies never make anything cheaper. It's just a free handout to the telecoms to keep doing the same thing they've always been doing it. If you really think the FCC is going to do something about it this time, Lucy has a football for you to kick.

    reply to this | link to this | view in thread ]

  5. icon
    James Burkhardt (profile), 12 Jan 2022 @ 12:38pm

    Re: Re:

    I shouldn't be surprised that they do billing in the least effiecent way possible. I had assumed they were just talking out of their ass, but wow.

    reply to this | link to this | view in thread ]

  6. identicon
    Dave, 12 Jan 2022 @ 4:27pm

    Corporations will not listen to anyone demanding that they reduce their profits. Period.

    reply to this | link to this | view in thread ]

  7. icon
    That One Guy (profile), 12 Jan 2022 @ 8:28pm

    If you want them to do something, don't ask, tell

    Even if they do manage to pass this so long as there's no penalty for the ISP's to continue to play dumb they have no reason to change. I mean, it's free money, why would they give that up when they can use the whole thing to try to exploit their customers even more?

    reply to this | link to this | view in thread ]

  8. icon
    cattress (profile), 13 Jan 2022 @ 12:08am

    When do they get the money?

    Does anyone know if Comcast gets the subsidy based on the number of people actually enrolled, or are they getting the subsidy based on the estimated number eligible customers they have?
    Because as much as a pain in the ass the enrollment process is, just finding where to begin the process that they did next to zero advertising for, I would have to assume they get the subsidy even if they have less than the estimated number of eligible customers enrolled. I mean it really wasn't intuitive or obvious at all to apply for the discount. In fact I don't think I even found it logged into their website, that I had to search the program specifically to find the link.

    reply to this | link to this | view in thread ]

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