- As of June 1, the ACP's officially expired
- ISPs are trying to pick up the slack, but that's "simply not sustainable," according to Digital Progress Institute's Joel Thayer
- There's still a chance Congress can pass an extension, but the later it happens, the more complicated it'll be to get consumers re-connected
We’ve all kept hearing the end is nigh for the Affordable Connectivity Program. As of June 1, the program’s officially come and gone. Question is, now what?
The FCC required ISPs to notify ACP recipients that the program would expire, so that consumers wouldn’t be left in the dark (literally).
“My understanding is that the larger providers have decided to eat the cost and develop programs to keep ACP recipients on for some months after the expiration,” said Joel Thayer, president of the Digital Progress Institute.
Indeed, some providers, like Astound, Frontier and Verizon, have announced either alternatives to ACP or that they would subsidize the $30 benefit themselves for a period of time.
“However, that’s simply not sustainable and it’s unclear whether smaller providers that also participated in ACP will have similar programs in place,” Thayer told Fierce Network.
Despite attempts from carriers to provide discounted internet service, the ACP going away still puts both consumers and ISPs in a “fairly precarious state.”
How did we get here?
A number of legislative efforts were introduced in Congress to prolong the ACP. This includes the $7 billion ACP Extension Act, an amendment to the Federal Aviation Administration (FAA) reauthorization bill, another extension bill (which would allocate $6 billion) introduced last month.
None of those efforts seem to have gone anywhere, leaving 23 million households without an ACP subsidy. ISPs were able to offer a partial subsidy of $14/month for May, but that was that.
Senator Maria Cantwell (D-WA) on Wednesday evening announced her committee plans to vote on a bill June 12 that would both extend the ACP and allow the FCC to auction some spectrum bands.
However, New Street Research analyst Blair Levin said in a note Cantwell’s legislation is primarily about spectrum and that “this is the third effort by Cantwell to push this bill forward with the prior efforts for a markup pulled at the last minute.”
“We don’t think Cantwell would schedule the vote without confidence that it would pass through the Committee, but we think ultimate passage is still uphill,” Levin added.
While there’s always a chance Congress can pass an ACP bill, Thayer said, “the window will only get narrower as time goes on.”
The longer ACP lapses, the more difficult it’ll be to get consumers back online if the program does get re-funded.
“Frankly, the sooner the better because USAC still has the institutional know-how and infrastructure to get this back up without having to deal with mass re-enrollment,” Thayer said. “Also, long delays will adversely affect carriers’ ability to get their respective programs back up after winding everything up.”
“In short, the longer the wait, the more of a nightmare it will be for carriers and the FCC,” he said.
Impact on BEAD
The ACP’s expiration also doesn’t bode well for the Broadband Equity, Access and Deployment (BEAD) program.
According to Kathryn de Wit, director of Pew’s Broadband Access Initiative, states in their initial proposals had to outline how an ISP that wins BEAD funding would make a low-cost service option available to ACP-eligible households.
Some states – Louisiana, Kansas, Nevada and West Virginia – “all designed their low-cost service options to be between $30-$65” so that those households can afford internet on a BEAD-funded network.
But that’s easier said than done.
“Not only is the ACP subsidy critical to the success of BEAD, but states are also relying on the administrative infrastructure of the National Verifier to determine which households are eligible for a low-cost service option,” said de Wit.
The National Verifier is a centralized application system consumers used to apply for the ACP. SheerID is a company that’s trying to make up for the lack of ACP by helping ISPs verify low-income households for their own discounted internet programs.
A lose-lose situation
As for who has the most to lose, de Wit noted of the 23 million households on ACP, “approximately half are Americans over 50 and military families or veterans.”
Thayer said ACP provided more than 1 million veteran families “necessary assistance” to obtain broadband service they could use to make telemedicine appointments.
“Also, 4.4 million enrollees are above the age of 65 and another 5.8 million are ages 50-64. Many within these populations were likely first-time users,” he added.
“If their chosen carrier doesn’t have a plan in place to make up the difference for what the ACP provided, then they are also likely to drop broadband services entirely.”