I'd be interested to see some kind of economic analysis of this program.
On its face, the government subsidizing a for-profit company that has a monopoly seems like a terrible idea. Comcast already extracts monopolistic profits and thus captures as much of the economic surplus as possible.
Given that, price caps make a lot more sense to me. That's what has worked for utilities in general. If there's only one producer, they should be negotiating with one consumer.
But maybe I don't see the whole picture. Did the subsidy agreements work as a carrot to entire Comcast to lower its prices for enough residents that it was a net benefit? Are the positive externalities of a connected population worth the cost? Did this program work in some other way than subsidy?
Would love to learn more about this if anyone has good sources
I'd like to see this as well. I suspect the money would be better spent subsidizing/establishing community-owned ISPs in underserved areas.
There are still old telephone co-ops from the early days of the telephone in the US. The one I'm thinking of is extremely rural (population density is < 2 people per square mile), with a median county household income under $25K. They put in fiber to the home years ago, and 1GBit symmetric is well under $100 a month. (They have cheaper plans too.)
Similarly, some places have started using companies like this:
You pay them to build out a local fiber network. You just pay the line installation, and then the community owns the network. The minimum project size is about 100 houses because that leads to a $100/month per house bill from the incumbent network's $10,000/month fiber uplink.
Concretely, imagine there was a subsidy for any area that doesn't have 1GBit symmetric for under $100 a month. Starting in the poorest communities, use the ACP money to establish a local co-op (per community, creating jobs) that charges 1.1x the cost of the fiber uplink per month, and saves 10% for network expansion / maintenance.
The ACP burned through $14.2B since 2021. It costs about $10K to run fiber to a house (it's almost all labor, so in urban areas you have short runs with high cost of living for the workers, and in rural areas you have long unobstructed runs with low cost of living).
They could have wired 1.4M low income houses for fiber with that money, and the co-ops could then charge the houses well under $100 per month for connectivity.
In California we have the CPUC which regulates utilities. Our three biggest utilities charge around 3x the national average for electricity. The largest--PG&E--has also been setting the state on fire and blowing up neighborhoods.
The idea on paper I think was to encourage building out the infrastructure to areas that would not otherwise be profitable enough to build to by increasing the number of available customers in a poor neighborhood.
Personally I think it's a tough spot. Infrastructure projects like ISP connections are best done once to a residence like power or water/sewer which is usually a city or heavily regulated natural monopoly. Ideally you could have the city run fiber to residences in the metro area and companies could compete for the service across those wires if we wanted to cling to markets like some places do with various billing providers for electrical power.
The program had/has many ISP participants, my small local fiber company participates ATT and Comcast just streamlined the application for their customers with applications on their sites, otherwise you apply with the government's ACP site which takes about an extra month longer to be approved. If approved it provides a $30 month credit to the ISP.
There's a huge need for subsidizing the internet for low income elderly/rural folks though. That's the intent. I work in digital equity and inclusion so tons of my learners/clients utilized the ACP. These are not middle class folks utilizing a loophole. I'm skeptical of these loophole claims as I know many who were denied for being ever so slightly over the poverty level.
So sure, on one hand giving more dollars to Comcast seems terrible, but that's like not wanting a school lunch free program because it's going to benefit Sysco or Aramark. There is a real need for helping low income access the internet.
Price caps could make sense, but in my experience the more important missing piece is a requirement that a lower tier be offered. Comcast keeps upping their lowest tier, and raising the price concomitantly. I started out at 12Mbps and am now at 80. I don’t remotely need 80, and would love to pay half of my current rate for half of my current speed. I’d even pay 2/3 of my cost for 1/3 of my speed. But Comcast does not offer a tier below 80/10 in my area.
Will never happen. Comcast has the power, not the politicians. As Marx showed us 150 years ago, a state under capitalism tends to become a capitalist state.
Whenever Comcast raised my rates, I would call and ask for a lower price or lower tier. In recent years, they always tried to get me to sign up for this. One rep claimed that I qualified because a student (my elementary aged child) lives in the home. Another claimed that I qualified because my child receives free lunch at school (as do all students at California public schools). He said that it was common in his experience for people to sign up under such pretenses.
I don’t know to what extent this program is being abused, but it’s surely happening. The government is basically enabling the cable companies to keep upping their base price, knowing that any customer who is desperate enough for a discount will just find a way to qualify themselves for this program.
I think being able to have internet at home is important. But there should have been limits put in place to ensure that this program was only being used for its intended purpose. Some lobbyist got rich off this thing, for sure.
It's interesting that we're talking about helping people reduce costs, instead of penalizing companies that raise rates for something that should be a utility and has close to fixed costs to operate.
Very similar thing happened to me, except with Spectrum. Called to complain after they increased my bill. The only option they gave me was to sign up for ACP, which they said I was automatically eligible for strictly based on my address. They would not let me switch to a lower-tier plan ...unless I signed up for ACP.
I didn't feel right about it, so I cancelled my service, switched to AT&T, and filed a complaint with the FCC. The FCC then forwarded my complaint to Spectrum, who more or less claimed everything was hunky dory. Nothing really came of it at all as far as I know.
> I don’t know to what extent this program is being abused, but it’s surely happening.
It's non-zero, sure. And although the GAO identified fraud risks, no fraud assessment has been done. A humane response to this would've been to perform a fraud assessment and allow the FCC to take action against identified risks. This will hurt poor families by widening the digital divide, impact family education and employment, and reduce access to services.
The wind down period is a bit complicated so it's worth pointing it out.
If you're already on the ACP, you will continue to receive the benefit until the funds run out, which is probably April unless Congress adds more funds which may not happen.
If you're not already on the ACP, you still have a chance to enroll. You can send in an application until Feb 7, 11:59 pm ET, and if approved, you will have the opportunity to sign up with your local ISP. After completing both steps, you will then receive the benefit until April as said before.
I looked into this for a relative and the ACP provider space is full of scammy looking companies that don't appear to offer much above what is already offered by the Lifeline program. The big providers also participate in the program and unless you absolutely have no money for a monthly fee, seem to be the way to go instead of with the questionable resellers that fit their fee into the ACP subsidy completely. And don't get me started on the "low cost" trash devices they're selling for a "co-pay of $10". The program is good in theory but the implementation feels like it is coated in a thick layer of pond scum.
I'm confused by this. As someone who has set up dozens of released prisoners with ACP, I think you are wrong.
With Lifeline, in my neighborhood, you have a dozen scammy people on every street corner giving you a free phone or tablet, sometimes with no fees, other times they charge you (whether this is legal I don't know). These devices all come with only 15GB/mo of data which the ex-cons use up on YouTube or PornHub within the first three days of each month and then have no data to do anything essential with.
With ACP I can go into any cellphone store, Cricket, Metro, etc, get them a real 5G unlimited plan and decent phone for $40/mo, take off the $30/mo for ACP and off they go. All they have to do is make sure they find the $10 to keep their plan every month and, believe me, they want that porn to keep coming...
I'm not going to opine on the program itself or who it serves, but they are -way- too loose with the money IMO.
I make plenty, and still had my child's school, my ISP, cell phone carrier, and others browbeating me into applying. I even told them I didn't know much about it, but think I probably don't qualify, and they kinda imply 'oh theres other ways.'
I did qualify, because my daughter's school is a CEP school. Out of curiosity I did as they were instructing, and sure enough it was approved without issue. Why? What's in it for my ISP and cell provider to give me a discount? Were they receiving more back in kickbacks?
I didn't renew because ultimately I felt guilty, but have to wonder how many people who didn't need it took advantage.
On the plus side, it did allow me to keep Comcast's "secret" $30/mo plan, that they let me keep after it expired.
> What's in it for my ISP and cell provider to give me a discount? Were they receiving more back in kickbacks?
the person you're talking to probably earned a commission or bonus based on how many they can convince to sign up.
This is what happens to gov't incentive programs - the cash and value generation is distorted.
Look at how homelessness problems in california is not solved, despite paying more than some $200k per homeless person in subsidies and grants. This is more than most (or any) job would've paid to that person. And yet, it fails to achieve anything of note, because the value generation (taxation) is _not_ aligned with the value recipient (which is not the homeless person, but the various orgs that spring up to eat the value while attempting to prolong the gov't subsidy/grant).
The biggest thing is the ISP is making money the customer isn't hurting for. So their total profits are higher, and they might even be able to raise your rates with some nonsense junk fees, but because the government is footing part of the bill, you don't care as much/tolerate it.
The ACP has the same problem our healthcare often does: Rather than forcing corporations not to fleece people, the government foots the bill and gets fleeced itself instead.
The US government seems unwilling or unable to just put their foot down and say "you're charging too much, and we're putting a stop to that".
The ISPs themselves only recieve the amount from the FCC of your discount. The advantage to the ISP of enrolling everyone they can in the program is stability. They get that money every month, wether you lose your job and can't pay or you just forget to pay. Maybe thats not a rsik for you, but the ISP has enough customers for whom that is a risk, that marketing it to everyone is well worth it.
I don't know why the school would push ot so jard, except making sure that everyone who needs it gets on it so they jave internet at home. Schools do push everyone to apply for the Free and Reduced lunch program, wether they need it or not, because there are many other funding programs tied to it. I don't know of any programs tied to the ACP directly, though.
People forget that ISPs took billions in government money a few decades ago to fund a broadband rollout (and the attendant drop in prices) that never happened. Overall costs aside, as an individual, any discount like this is just someone putting back money in your pocket that should never have been taken out in the first place.
It sets a subsidized price floor preventing true competition that would naturally offer cheap plans. It's ridiculous that you can't buy sub-$50 plans in many markets.
how would those companies browbeating you know that you "make plenty". The program needs a policy revision not "lets cut poor people off internet". They would expect honest people not to take them up on the offer if they making plenty of money. It's called being part of a society and knowing you're taking money from a program being targeted at the poor.
comcast and other cable providers do not block as I just verified this with using xfinity comcast to access the site this morning with no VPS whatsoever.
[+] [-] cowpig|2 years ago|reply
On its face, the government subsidizing a for-profit company that has a monopoly seems like a terrible idea. Comcast already extracts monopolistic profits and thus captures as much of the economic surplus as possible.
Given that, price caps make a lot more sense to me. That's what has worked for utilities in general. If there's only one producer, they should be negotiating with one consumer.
But maybe I don't see the whole picture. Did the subsidy agreements work as a carrot to entire Comcast to lower its prices for enough residents that it was a net benefit? Are the positive externalities of a connected population worth the cost? Did this program work in some other way than subsidy?
Would love to learn more about this if anyone has good sources
[+] [-] hedora|2 years ago|reply
There are still old telephone co-ops from the early days of the telephone in the US. The one I'm thinking of is extremely rural (population density is < 2 people per square mile), with a median county household income under $25K. They put in fiber to the home years ago, and 1GBit symmetric is well under $100 a month. (They have cheaper plans too.)
Similarly, some places have started using companies like this:
http://nextlevelnetworks.ca
You pay them to build out a local fiber network. You just pay the line installation, and then the community owns the network. The minimum project size is about 100 houses because that leads to a $100/month per house bill from the incumbent network's $10,000/month fiber uplink.
Concretely, imagine there was a subsidy for any area that doesn't have 1GBit symmetric for under $100 a month. Starting in the poorest communities, use the ACP money to establish a local co-op (per community, creating jobs) that charges 1.1x the cost of the fiber uplink per month, and saves 10% for network expansion / maintenance.
The ACP burned through $14.2B since 2021. It costs about $10K to run fiber to a house (it's almost all labor, so in urban areas you have short runs with high cost of living for the workers, and in rural areas you have long unobstructed runs with low cost of living).
They could have wired 1.4M low income houses for fiber with that money, and the co-ops could then charge the houses well under $100 per month for connectivity.
[+] [-] zbrozek|2 years ago|reply
It doesn't seem like this model works either.
[+] [-] rtkwe|2 years ago|reply
Personally I think it's a tough spot. Infrastructure projects like ISP connections are best done once to a residence like power or water/sewer which is usually a city or heavily regulated natural monopoly. Ideally you could have the city run fiber to residences in the metro area and companies could compete for the service across those wires if we wanted to cling to markets like some places do with various billing providers for electrical power.
[+] [-] kulshan|2 years ago|reply
There's a huge need for subsidizing the internet for low income elderly/rural folks though. That's the intent. I work in digital equity and inclusion so tons of my learners/clients utilized the ACP. These are not middle class folks utilizing a loophole. I'm skeptical of these loophole claims as I know many who were denied for being ever so slightly over the poverty level.
So sure, on one hand giving more dollars to Comcast seems terrible, but that's like not wanting a school lunch free program because it's going to benefit Sysco or Aramark. There is a real need for helping low income access the internet.
[+] [-] gnicholas|2 years ago|reply
[+] [-] jdksmdbtbdnmsm|2 years ago|reply
Will never happen. Comcast has the power, not the politicians. As Marx showed us 150 years ago, a state under capitalism tends to become a capitalist state.
[+] [-] coryrc|2 years ago|reply
[+] [-] gnicholas|2 years ago|reply
I don’t know to what extent this program is being abused, but it’s surely happening. The government is basically enabling the cable companies to keep upping their base price, knowing that any customer who is desperate enough for a discount will just find a way to qualify themselves for this program.
I think being able to have internet at home is important. But there should have been limits put in place to ensure that this program was only being used for its intended purpose. Some lobbyist got rich off this thing, for sure.
[+] [-] nilamo|2 years ago|reply
[+] [-] Jeema101|2 years ago|reply
I didn't feel right about it, so I cancelled my service, switched to AT&T, and filed a complaint with the FCC. The FCC then forwarded my complaint to Spectrum, who more or less claimed everything was hunky dory. Nothing really came of it at all as far as I know.
[+] [-] CharlesW|2 years ago|reply
It's non-zero, sure. And although the GAO identified fraud risks, no fraud assessment has been done. A humane response to this would've been to perform a fraud assessment and allow the FCC to take action against identified risks. This will hurt poor families by widening the digital divide, impact family education and employment, and reduce access to services.
[+] [-] phone8675309|2 years ago|reply
[+] [-] gurchik|2 years ago|reply
If you're already on the ACP, you will continue to receive the benefit until the funds run out, which is probably April unless Congress adds more funds which may not happen.
If you're not already on the ACP, you still have a chance to enroll. You can send in an application until Feb 7, 11:59 pm ET, and if approved, you will have the opportunity to sign up with your local ISP. After completing both steps, you will then receive the benefit until April as said before.
[+] [-] Mountain_Skies|2 years ago|reply
[+] [-] qingcharles|2 years ago|reply
With Lifeline, in my neighborhood, you have a dozen scammy people on every street corner giving you a free phone or tablet, sometimes with no fees, other times they charge you (whether this is legal I don't know). These devices all come with only 15GB/mo of data which the ex-cons use up on YouTube or PornHub within the first three days of each month and then have no data to do anything essential with.
With ACP I can go into any cellphone store, Cricket, Metro, etc, get them a real 5G unlimited plan and decent phone for $40/mo, take off the $30/mo for ACP and off they go. All they have to do is make sure they find the $10 to keep their plan every month and, believe me, they want that porn to keep coming...
[+] [-] foobarbazbanana|2 years ago|reply
[+] [-] jimmydoe|2 years ago|reply
[+] [-] silisili|2 years ago|reply
I make plenty, and still had my child's school, my ISP, cell phone carrier, and others browbeating me into applying. I even told them I didn't know much about it, but think I probably don't qualify, and they kinda imply 'oh theres other ways.' I did qualify, because my daughter's school is a CEP school. Out of curiosity I did as they were instructing, and sure enough it was approved without issue. Why? What's in it for my ISP and cell provider to give me a discount? Were they receiving more back in kickbacks?
I didn't renew because ultimately I felt guilty, but have to wonder how many people who didn't need it took advantage.
On the plus side, it did allow me to keep Comcast's "secret" $30/mo plan, that they let me keep after it expired.
[+] [-] chii|2 years ago|reply
the person you're talking to probably earned a commission or bonus based on how many they can convince to sign up.
This is what happens to gov't incentive programs - the cash and value generation is distorted.
Look at how homelessness problems in california is not solved, despite paying more than some $200k per homeless person in subsidies and grants. This is more than most (or any) job would've paid to that person. And yet, it fails to achieve anything of note, because the value generation (taxation) is _not_ aligned with the value recipient (which is not the homeless person, but the various orgs that spring up to eat the value while attempting to prolong the gov't subsidy/grant).
Have a watch of https://www.youtube.com/watch?v=PNxQ8JWxWMA
[+] [-] ocdtrekkie|2 years ago|reply
The ACP has the same problem our healthcare often does: Rather than forcing corporations not to fleece people, the government foots the bill and gets fleeced itself instead.
The US government seems unwilling or unable to just put their foot down and say "you're charging too much, and we're putting a stop to that".
[+] [-] ensignavenger|2 years ago|reply
I don't know why the school would push ot so jard, except making sure that everyone who needs it gets on it so they jave internet at home. Schools do push everyone to apply for the Free and Reduced lunch program, wether they need it or not, because there are many other funding programs tied to it. I don't know of any programs tied to the ACP directly, though.
[+] [-] underlipton|2 years ago|reply
[+] [-] Dalewyn|2 years ago|reply
Honest people finish dead last in the race that is life. The winners are people who know where to draw the line between honesty and God Damn Lies(tm).
I say that as another fellow honest person (or at least I like to think I am...).
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