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FCC cuts subsidies to some low-income broadband users

Photo: Carl Court/Getty Images

The FCC made a decision today that will hinder some low-income families from making use of its broadband subsidy program, Lifeline. According to Ars Technica, the federal agency has just blocked nine companies from entering the program, despite the fact that they were all admitted just one month ago. The FCC appears to be rescinding the offer it approved back in January to the following companies: Spot On, Boomerang Wireless, KonaTel, FreedomPop, AR Designs, Kajeet, Liberty, Northland Cable, and Wabash Independent Networks. The December 2016 order that added the nine companies to the Lifeline program was touted as having “enabled the FCC to approve new Lifeline Broadband Providers nationwide, instead of following the state-by-state process as used to be the case, and gradually phases out support for voice so that in the future, all Lifeline providers would have to offer broadband if they wanted Lifeline support.”

Although there’s an ongoing investigation into claims of fraud by some of Lifeline’s corporate members, the nine companies that just had their entry postponed have had no such allegations made against them. But their customers will now see their bills increased by $9.25 a month, the amount of the Lifeline subsidy. Or, they can switch to a new provider (and we all know how easy that is).


New FCC Chairman Ajit Pai claimed that the latest decision to prevent “these last-minute actions, which did not enjoy the support of the majority of commissioners at the time they were taken” from “[binding] the agency going forward.” But FCC commissioner Mignon Clyburn said that the decision to reverse course and narrow consumer choices has just “widened” the digital divide.

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