WASHINGTON, September 28, 2023 – A broadband association asked Congress last week to open the Universal Service Fund to contributions from broadband and Big Tech revenues to allow the umbrella fund to absorb and support the Affordable Connectivity Program.

The industry is concerned that the $14-billion ACP program, which discounts monthly services for low-income Americans and those on tribal lands, is going to run out of money by early next year. Meanwhile, it is universally agreed that the Universal Service Fund, which includes four high-cost broadband programs, is struggling to maintain its roughly $8-billion annual pace without a diversification of its revenue sources.

Jonathan Spalter, president and CEO of USTelecom, told the Communications and Technology subcommittee studying the future of rural broadband on September 21 that Congress could both support the sustainability of the USF and the ACP by forcing contributions from broadband and Big Tech revenues.

The idea is that the extra revenue would solve the USF sustainability question by allowing the fund to continue to support the existing four programs under its purview, while also allowing it to adopt the ACP program, hence removing that program from reliance on Congress for money.

“We can have Congress give the FCC the authorities that it requires to be able to expand the contribution base, integrating the ACP within USF program, and thereby allowing the potentially out of control contribution factor that will potentially bog down the viability and longevity of the Universal Service Fund mechanisms to go down,” Spalter said.

“And in so doing it can expand the contribution base sufficiently to allow not only broadband but importantly the dominant Big Tech companies to participate so that we would effectively fuse the Affordable Connectivity Program with [high-cost program] Lifeline and do so in a way that would actually not require appropriated dollars from Congress.”

The ACP currently has around 21 million Americans signed up, but the FCC says many more are eligible. The commission has been allocating money to outreach groups to market the subsidy program.

While some have argued that the Federal Communications Commission could unilaterally expand the contribution base of the USF, the commission has elected to wait for Congress to make the requisite legislative reforms to give it that authority.

Forcing Big Tech companies, which rely on the internet to deliver their products, has been an idea tossed around by experts and promoted by Federal Communications Commissioner Brendan Carr. Meanwhile, forcing broadband revenues to contribute to the fund has also received good support.

The concern for the ACP program is that the internet service providers rely on the $14 billion to continue to offer discounts.

“With funding set to be depleted early next year, initial notices of service termination could be out during the height of the holiday season in December – that’s a present none of our constituents deserve to receive,” said Congresswoman Doris Matsui, D-Calif.  

“Poverty is everywhere, but higher in rural America, in our region the reason most people can’t adopt service is due to lack of affordability, this impacts more households than lack of infrastructure alone,” said Sara Nichols, senior planner of the Land of Sky Regional Council of Government.

“It’s a program we simply can’t afford to lose,” added Nichols.

WASHINGTON, September 28, 2023 – The Federal Communications Commission announced on Wednesday that it will consider at its October meeting a proposal to allow very low power devices to operate in the 6 Gigahertz Wi-Fi band.

The proposal would open up 850 megahertz of the 6 GHz band – about two thirds of the band’s spectrum – for very low power, or VLP, operation. 

That means VLP devices could use radio waves set to frequencies in the allowed range to communicate with wireless routers. The commission first opened up the 6GHz range for unlicensed Wi-Fi connectivity use, meaning device manufacturers do not need specific permission from the FCC to use those frequencies, in 2020.

FCC Chairwoman Jessica Rosenworcel said the proposed addition of VLP devices to that band would help meet growing demand for unlicensed spectrum.

“Wi-Fi connectivity over unlicensed spectrum is the oxygen that sustains much of our everyday lives,” she said.

The proposed order does not go as far as some Wi-Fi advocates wanted. More than a dozen groups signed a letter urging the FCC to open all 1,200 MHz of the 6GHz band for VLP use, citing a desire to keep future technologies accessible.

The proposed report and order, circulated Wednesday to commissioners, puts off enacting rules on allowing low power devices to use slightly more power while indoors, another change the advocates wanted to see, instead opting to take more public comments on the move. 

It would also seek comment on expanding VLP use to the entirety of the band, something the FCC took comments on when it first opened the band for unlicensed use in 2020.

Apple has been urging the FCC to open the band to more mobile applications, such as smartphones, watches and headphones. At 16 times lower power than the standard Wi-Fi, VLP “greatly reduces the risk of harmful interference,” the company said in a presentation to the commission earlier this year. 

The commissioners will vote on the proposal at FCC’s open meeting on October 19, barring a government shutdown.

WASHINGTON, September 26, 2023 – The survival of federal broadband subsidies will be essential for the success of the Broadband Equity, Access and Deployment program, expert panelists said at the Broadband Breakfast BEAD Implementation Summit on Friday.

Broadband providers building infrastructure with funding from the $42.5 billion BEAD program will be required to participate in the Affordable Connectivity Program. The ACP, comprised of $14 billion set aside by the 2021 Infrastructure, Investment and Jobs Act, provides monthly internet subsidies of $30 for low-income households and $75 for residents of tribal lands and in high-cost areas. 

Federal Communications Commission Chairwoman Jessica Rosenworcel testified to the Senate on September 19 that the money is set to dry up as early as April 2024.

That could prevent people from being able to access the networks built with BEAD funds, said Angie Kronenberg, president of tech trade group INCOMPAS.

“That’s before the network has even been built,” she said of the estimated end date. “We really, really must have this issue addressed.”

A coalition of 45 members of Congress signed in August a letter to House and Senate leadership urging them to find money for the ACP in the appropriations bill that will fund the government for the next year. Congress is likely to miss the October 1 deadline for that bill and trigger a government shutdown.

The Universal Service Fund, which spends roughly $8 billion annually to fund four internet subsidy programs, also has an uncertain future. Lawmakers are looking to change its funding mechanism – currently a tax on voice providers – and conservative groups are challenging the fund in court.

Panelists said the USF subsidies, which help low-income households, healthcare providers, schools, and libraries, in addition to rural providers in expensive-to-serve areas, will be essential for ensuring consistent, long-term access to broadband infrastructure built with BEAD and other federal funds.

“Getting people onto the network is the goal here, it’s not just planting a flag or ‘mission accomplished’ banner for building the network,” said Mike Romano, executive vice president of the Rural Broadband Association.

Scott Woods, president of public-private partnerships at broadband grant company Ready.net, agreed that expanding networks is only part of the goal for the BEAD program.

“We could spend $200 trillion on infrastructure,” he said, “but if the people it’s designed to impact can’t afford it, it’s stranded assets.”

The discussion was moderated by David Bronston, special counsel at Phillips Lytle, LLP.

If you missed the BEAD Implementation Summit, sign up for Broadband Breakfast’s BEAD Starter Pack for $35/month (cancel anytime). You’ll get access to all the videos and each of the three Breakfast Club reports prepared for the BEAD Implementation Summit:

• July 2023 – A Deep Dive into Allocations Under the Broadband Equity, Access and Deployment Program
• August 2023 – Precursors to BEAD Implementation: A Deep Dive Into Prior Broadband Programs
• September 2023 – A Deep Dive into the BEAD Program’s Matching Funds

Already a Broadband Breakfast Club member? Watch the videos!