A new report from think the Information Technology and Innovation Foundation (ITIF) suggests that lesser federal broadband subsidies should be cancelled, with funding used to support the Affordable Connectivity Programme (ACP)
This week, the ITIF is calling on the US government to consider cancelling several ‘redundant’ broadband programmes to instead use their funding to support the ACP.
The report suggests that the ACP should “become the premier federal broadband program” due to its flexibility and direct support of low-income households but warns that the current funding will soon fall short of the total demand.
The Affordable Connectivity Programme (ACP) is the US government’s “largest-ever broadband affordability effort”, according to the Federal Communications Commission (FCC), a long-term $17 billion plan to support eligible low- income households afford access to the internet.
The ACP offers these households discounts of up to $30 per month on their internet service bills, or up to $75 per month for households on qualifying Tribal lands. The project also provides one-time discounts of up to $100 to help disconnected families purchase a laptop, desktop, or tablet.
The funding comes as part of the $1.2 trillion Infrastructure Investment and Jobs Act, signed into law by the Biden administration in November 2021.
At this year’s Connected America conference in March, the FCC’s Press Secretary, Paloma Perez, gave an update on the recently-awarded ACP funding, saying 17 million homes had been enrolled nationwide.
Since then, this number has increased to almost 20 million, but many millions of eligible households still have not signed up, with the FCC estimating that in total 50 million homes could qualify for discounts across the country.
To make matters worse, according to estimates based on data from apcdashboard.com, the roughly $17 billion appropriated for the programme in 2021 will likely run out during 2024.
The ITIF estimates that the ACP will require between $5 billion and $6 billion a year to remain effective.
But where can the government find this funding?
According to the ITIF, the solution lies in streamlining the highly convoluted broadband subsidy landscape, particularly scrapping programmes that are becoming obsolete as a result of more modern programmes, such as the ACP itself and the Broadband Equity Access and Deployment (BEAD) funding programme.
The report argues that the FCC’s Lifeline programme, which also provides discounts for low-income families, is outdated and should be scrapped in favour of the ACP. The report further suggests that the FCC’s Universal Service Fund High Cost programme and the U.S. Department of Agriculture’s ReConnect programme can also be cannibalised to fund the ACP, having been made redundant by the more effective (BEAD) programme.
Combined, reallocating the funding from these three programmes should provide roughly $6.43 billion, enough to sustain the ACP.
“Federal broadband programs are dangerously out of balance,” said Joe Kane, director of broadband and spectrum policy at ITIF and author of the report. “Congress has created effective subsidy programs that render older programs duplicative and wasteful. Yet the old programs persist, siphoning funding away from more effective ones and increasing phone bills.”
But while reallocating funding from these older projects could be a fine way to extend the lifetime and impact of the ACP, it is important to remember that funding is not everything. As the report points out, the digital divide in the US not only relates to lack of access to affordable connectivity, but also to digital literacy.
“If its funding is secured and made sustainable, the ACP is the best policy tool available to defray the cost of Internet subscriptions and connected devices,” said the ITIF report. “Once this relatively low-hanging policy fruit has been picked, broadband policy is not finished. Remaining offline groups will require different kinds of help to achieve full digital inclusion.”
Want to learn more about how government funding is transforming the connectivity landscape in the US? Join the digital ecosystem in discussion at this year’s Connected America
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