California’s $15 Broadband Proposal Could Save Households $1B Annually, State Report Finds

WASHINGTON, April 2, 2025 – A proposal to cap broadband prices at $15 per month for low-income Californians could save households over $1 billion annually with minimal impact on industry revenues, according to a new report from the California Public Utilities Commission’s Public Advocates Office.

The report, authored by CPUC’s program manager for communications and broadband policy, Ernesto Falcon, analyzes the financial and social impact of Assemblymember Tasha Boerner’s California Affordable Home Internet Act. 

The bill would require all broadband providers operating in the state of California to offer 100 Megabits per second (Mbps) downstream and 20 Mbps upstream service for $15/mo to households earning less than 200% of the federal poverty line.

The report found that more than 500,000 low-income households in California currently pay an average of $30 per month for 100/20 Mbps or slower broadband service. Dropping that cost to $15 would yield nearly $100 million in collective annual savings. 

An additional 850,000 low-income subscribers pay more than $30 for higher-speed plans. While it’s unclear how many would opt to downgrade speeds, the report suggests “if adoption rates by low-income Californians were to reach nearly 100%, the total net consumer savings statewide could exceed $1 billion per year.”

According to data from the recently expired federal Affordable Connectivity Program, a total of 5,844,797 California households with incomes at or below 200% of federal poverty guidelines were eligible for low-income broadband assistance.

Despite these massive consumer benefits, the report finds that the impact on industry revenues of the four largest ISPs operating in the state — AT&T, Comcast, Cox, and Charter — would be modest. Based on confidential data from the four major ISPs, the total revenue loss from a mandated $15 plan would amount to less than 1% of their combined earnings in California. 

In fact, the report finds revenue loss would be 1/30th the amount earned from just one of their most popular broadband packages, typically priced between $85 and $99 per month.

The proposal builds on a legal precedent established by New York’s Affordable Broadband Act, which was upheld by the Second Circuit Court of Appeals and left unchallenged by the U.S. Supreme Court. That law mandates $15 and $20 broadband plans for low-income New York households, and resulted in AT&T withdrawing its fixed wireless service, Internet Air, from the New York market.

“The industry has claimed that AT&T was forced to discontinue its limited deployment of fixed wireless 5G (at nearly triple the price of Verizon’s low-income 5G home internet service), but our review of confidential data submitted to the CPUC by broadband providers does not support this assertion,” the report states.

Despite the potential benefits, the report makes clear that affordability remains a barrier for many households, even at $15 per month.

Using the CPUC’s Affordability Ratio Calculator, the report finds that in 18 communities across Alameda, Fresno, Kern, Los Angeles, and Yolo counties, low-income households would still spend more than 15% of their discretionary income on broadband — exceeding the CPUC’s own affordability threshold — even at the proposed $15 monthly rate.

“This is an urgent reminder that for the poorest Californians, even deeply discounted broadband is out of reach,” the report states.

CPUC's Public Advocates Office recommended that any price mandate be paired with a state-level subsidy program that could fully cover broadband costs for the most vulnerable households.

Estimates suggest that such a subsidy could cost between $300 million and $1 billion annually, depending on household adoption rates and the size of the subsidy ($15, $20, or $30 per household). But those costs, the report argues, would be more than offset by downstream savings — particularly telehealth savings.

Both Comcast and Charter currently offer discounted plans for qualifying low-income customers. Comcast’s Internet Essentials offers a $14.95/mo plan for low-income residents up to 75 Mbps, or $29.95/mo for up to 100 Mbps, while Spectrum Internet Assist offers 50 Mbps for $25/mo for qualifying households.