A presentation at National Rural Assembly 2015

1. Lifeline Modernization:
Connecting Low-Income Americans
to Broadband
2015 National Rural Assembly
September 9, 2015

2. Universal Service
• Universal Service: connecting every American
regardless of geography, income, or other factors.
• America’s communications policy is based on
fundamental principle of universal service.
• Congress has long recognized Universal Service as a
fundamental goal of telecommunications regulation:
– Communications Act of 1934;
– Renewed, in Telecommunications Act of 1996.
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3. History of Lifeline
• Lifeline was created by FCC in 1985 to help connect low-
income households to telephone service.
– “Access to telephone service has become crucial to full participation in
our society and economy, which are increasingly dependent upon the
rapid exchange of information.”
• In 1984, there was a 12% gap in telephone penetration rates
between low-income (annual income under $10,000) and
non-low-income households.
• Adoption rate for households at or below 200% of federal
poverty line was 80.1%.
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4. History of Lifeline Cont’d.
• Telecommunications Act of 1996 codified principle that rates
should be affordable and low-income consumers should have
access to telecommunications services.
– Recognized “Universal service is an evolving level of
telecommunications services.”
• In 2005, FCC modernized Lifeline to permit participation by
wireless carriers and non-facilities based telecommunications
providers.
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5. Success of Lifeline
• In 1984, there was a 12% gap in telephone
penetration rates between low-income and
non-low-income households.
– By 2011, the adoption gap narrowed to 4%.
• Telephone service adoption rates for low-
income households rose from 80.1% in 1984
to 92.6% in 2014.
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6. Broadband is Essential
• Broadband is the essential communications
medium for the 21st Century.
• Americans use broadband for education,
employment, health care, civic engagement,
social services, commerce, etc.
• Americans without broadband Internet access
service are missing out on opportunities and
resources available online.
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7. Affordability is a Barrier to Adoption
• Broadband is unaffordable to many low-income
Americans.
– “people with low-incomes, less education, or disabilities,
as well as unemployed individuals or seniors, certain
minorities, and non-family households, are on the wrong
side of the [digital] divide.”
• Only 48% of households earning less than $25,000 per
year subscribe to broadband Internet access service.
– 95% of households earning $150,000+ are online.
• Low-income households and unemployed typically say
cost is the reason they don’t have broadband.
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8. Modernizing Lifeline for 21st Century
• 2010, National Broadband Plan recommended
updating Lifeline to support broadband.
• 2012, FCC set goal to modernize Lifeline to
support broadband and established Lifeline
broadband pilot projects.
• June 2015, FCC proposed to update Lifeline to
support broadband Internet access and asked
for comment on how to do it.
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9. FCC Lifeline Modernization Proposal
• Proposes to update Lifeline to support broadband
Internet access service.
– Subsidy of $9.25 per month for eligible households.
• Asks questions about how the program should
work:
– Minimum standards for services?
– Continue to support voice service?
– What types of providers can participate?
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10. Effect on Rural Communities
• Low-income households (under $25,000 per year) in rural areas have very
low adoption rates – 36%.
– Nationally, low-income households have 48% adoption rate.
• Increased broadband adoption will expand access rural Americans have to
education, employment, health care, etc.
– Helps students close the skills gap. Being online helps students access resources that
may be unavailable at their school or in the community.
– Provides access to employment opportunities. 80% of Fortune 500 employers require
online job applications. Millions of businesses, including 24% of rural businesses, allow
employees to telework.
– Enables remote access to health care, which can can help rural patients receive
diagnoses and care from specialists located elsewhere.
– Allows households to save over $8,000 per year on food, transportation, clothing, etc.,
and expands access to goods and services.
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11. Status of FCC Proceeding
• FCC deadline for Comments on Lifeline
Modernization proposal was Aug. 31.
• FCC accepting Reply Comments until Sept. 30.
• FCC needs to hear from you to understand
how it can update Lifeline to make broadband
more affordable and attainable for rural
Americans.
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12. Where to Learn More
• FCC Lifeline Program Page
– https://www.fcc.gov/lifeline
• Lifeline Modernization Proposal
– https://www.fcc.gov/document/fcc-releases-lifeline-reform-and-
modernization-item
• Lifeline Modernization Docket
– http://apps.fcc.gov/ecfs/comment_search/execute?proceeding=11-42
• Tell FCC What You Think Via Electronic Comment Filing System
– http://apps.fcc.gov/ecfs/upload/display
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