The Affordable Connectivity Program (ACP), a major federal initiative to bring the Internet to low-income households, ended in June 2024. The ACP provided up to a $30 monthly discount for internet services and a $75 monthly discount for those on qualifying Tribal lands. Additionally, it offered a one-time discount of up to $100 for purchasing a laptop, desktop computer, or tablet. This made getting affordable internet service a reality for many households nationwide.
Due to the exhaustion of its $14.2 billion funding without additional Congressional appropriations, the program’s termination has left many households without the financial support necessary to maintain their internet subscriptions. This development poses a critical question: Is providing affordable broadband sustainable without federal subsidies?
Impact on Internet Service Providers (ISPs)
Several major ISPs have initiated measures to mitigate the impact on low-income consumers in response to the ACP’s end. Companies such as AT&T, Verizon, Spectrum, and Comcast have voluntarily offered plans priced at $30 or less to eligible households through the end of 2024. These efforts, while commendable, raise questions about their long-term viability without government support.
Comcast, for instance, reported a loss of 87,000 broadband customers in the third quarter of 2024, attributing this decline to the cessation of the ACP. This suggests that, despite voluntary initiatives, ISPs may face financial challenges in sustaining low-cost offerings independently.
Legislative and Policy Considerations
The expiration of the ACP has prompted calls for legislative action to establish a more sustainable framework for broadband affordability. Some policymakers advocate for integrating affordability programs into the Universal Service Fund (USF), which traditionally supports telecommunications services in underserved areas. Proposals include requiring ISPs and edge providers to contribute to the USF and expanding its financial base to support low-income broadband initiatives.
However, the USF itself faces legal challenges. In November 2024, the Supreme Court agreed to hear a case questioning the constitutionality of the USF’s funding mechanism. The outcome could significantly impact the future of broadband subsidy programs and their ability to provide affordable services to low-income populations. State-Level Initiatives and Challenges
At the state level, efforts to mandate affordable broadband options have met with mixed results. In New York, implementing the Affordable Broadband Act required ISPs with over 20,000 users to offer low-income households plans at reduced rates. In response, AT&T withdrew its 5G Internet Air service from the state, citing the economic infeasibility of complying with the mandated pricing structure. This incident underscores the tension between regulatory efforts to enforce affordability and service providers’ business models.
The sustainability of low-cost broadband services in a post-ACP landscape remains uncertain. While temporary measures by ISPs provide short-term relief, a comprehensive and enduring solution requires coordinated efforts at both federal and state levels. This includes exploring alternative funding mechanisms, fostering public-private partnerships, and addressing legal challenges to existing programs.
Moreover, as the digital divide persists, particularly affecting marginalized communities, the imperative for sustainable broadband affordability becomes increasingly critical. Ensuring that all Americans have access to reliable and affordable Internet services is essential for educational opportunities, economic participation, and social inclusion in the digital age.
