There is near unanimous industry agreement that a July 29, 2019 Petition for Waiver filed by NTCA–The Rural Broadband Association (“NTCA”) in Docket 11-42 should be granted by the FCC. The Petition seeks a waiver of the updated minimum service speed standard applicable to fixed wireline broadband Internet access service (“BIAS”) eligible for support under the Lifeline program scheduled to take effect on December 1, 2019. Here’s the background.

On July 25, 2019, the Commission released a Public Notice updating the minimum service standards for speed and usage allowances for Lifeline-supported services as required by its 2016 Lifeline Order. Included in the Notice was fixed broadband service. Thus, this December 1st, the Lifeline minimum service standard for fixed broadband speed will be 20 Mbps downstream and 3 Mbps upstream. NCTA has a problem with this.

The Association claims that the new minimum standards will result in higher prices for broadband service for the customers who can least afford it.

Grant of the requested relief would enable existing low-income consumers to continue, on a voluntary basis, receiving the service they already subscribe to as of December 1, 2019, or move on a voluntary basis to the new higher speed standard of service if that choice fits within their budget. This relief is necessary because the increase in speed mandated by the Public Notice will likely come with an increase in monthly rates that may make broadband services unaffordable for some low-income consumers. As a result, the Lifeline minimum speed standard, while intended to ensure low-income consumers receiving Lifeline support are not relegated to lower speed tiers than other consumers, could have the unintended consequence of forcing some low-income consumers that already have service to discontinue that service altogether due to the increased cost associated with being required to subscribe to a higher speed service. Such a result is entirely counter to the Commission’s goal of ensuring that low-income Americans have access to all that an Internet connection can provide. (NCTA Petition, filed July 29, 2019, at pp. 2-3.)

Exacerbating the problem, the amount of monthly support for Lifeline customers is decreasing.

Grant of the instant waiver is especially critical now as, beginning December 1, 2019, the amount of support provided to Lifeline customers subscribing to a combined voice and data service will decrease by $2 per month, to $7.25. Thus, even the Commission’s “remedy” of allowing Lifeline subscribers to continue to apply their discount to lower speed services if the subscriber chooses to purchase a combined voice and data package – in lieu of a BIAS only package at the minimum speed standard – will offer very little support as of December 1, 2019. (Id., at p. 3).

As mentioned, the waiver request received wide industry support. For example, the Public Utility Commission of Oregon (OPUC) noted,

the OPUC has observed and continues to observe the detrimental effect of annual speed standard increases for fixed BIAS on Lifeline subscribers. Eligible low-income customers are being "priced out" of the Lifeline program, which defeats the program's objective of affordability. Therefore, the OPUC agrees with NTCA that good cause exists for the FCC to waive application of the regulation governing service standards for fixed BIAS to minimize financial harm and lack of access to fixed BIAS for low-income customers. (Comments of the Public Utility Commission of Oregon, Docket 11-42, filed August 28, 2019, at p. 2).

At least one party opposes the waiver request. New America’s Open Technology Institute (OTI) argues that NTCA’s Petition fails to make any persuasive arguments that the new minimum standard would lead to price increases for Lifeline customers or that its members could not provide the service at the $9.25 price point. OTI also repeats arguments it made to a similar Petition by NCTA filed in 2018, claiming the Association leaves many questions unanswered including,

how long the waiver would last, whether NTCA members were planning to invest in new infrastructure to comply with the new standard, and how soon that would happen. That petition also failed to describe whether NTCA members were able to, despite the waiver requests, meet the new minimum standards increases from years prior at the $9.25 price point. (OTI Opposition to NCTA Petition, Docket 11-42, filed September 13, 2019, at p. 1.).

Despite OTI’s opposition, it seems common sense that with Lifeline support decreasing the Commission should not make the poorest Americans pay more for broadband service. Moreover, a higher speed broadband service is likely to result in higher prices for Lifeline customers. The Commission should grant the waiver.