TR Daily CTIA, Consumer Groups Urge Bureau to ‘Pause’ Lifeline Changes
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Friday, June 28, 2019

CTIA, Consumer Groups Urge Bureau to ‘Pause’ Lifeline Changes

CTIA and four consumer, public interest, and civil rights groups have asked the FCC’s Wireline Competition Bureau to waive two changes affecting Lifeline support that are due to take effect Dec. 1: “(1) an unanticipated five-fold increase in the minimum required broadband data usage allowance, and (2) the phase-down in support for voice services, which are still relied upon by upwards of 40 percent of current Lifeline subscribers.”

In a joint petition filed yesterday in WC dockets 11-42, 09-197, and 10-90 to pause implementation of December 2019 Lifeline minimum service standards pending a forthcoming marketplace study, the parties said that granting their petition “would maintain eligible low-income consumers’ ability to choose from Lifeline service plans that meet the current minimum standards of 2 GB per month of mobile wireless broadband data and 1,000 minutes of use per month of mobile voice services, pending the ‘State of the Lifeline Marketplace Report’ that the Commission directed the Bureau [in its 2016 Lifeline and Link Up reform and modernization third report and order] to complete by June 30, 2021.”

Joining CTIA in the petition were the National Hispanic Media Coalition, the National Consumer Law Center on behalf of its low-income clients, the United Church of Christ Office of Communications, Inc., and OCA – Asian Pacific American Advocates.

In 2016, the Democratic-controlled FCC, over the heated dissents of the agency’s two Republican Commissioners, extended Lifeline subsidies to cover mobile and fixed broadband Internet access services on a stand-alone basis or bundled with voice, and voted to phase out support for both fixed and mobile stand-alone voice service by the end of 2021 (TR Daily, March 31, 2016).

“[I]n the three years since the Commission adopted rules to ensure that eligible low-income consumers have access to a minimum level of Lifeline-supported mobile voice and broadband services, the marketplace for mobile wireless services and Lifeline services has continued to evolve in ways the Commission could not predict in 2016. Although the Commission has already scheduled a holistic review of the changes to the Lifeline program to be completed by June 30, 2021, marketplace change has out-paced the timeline for the Lifeline marketplace study. Given the current mobile wireless market, allowing the two changes to go into effect would restrict eligible low-income consumers’ access to, and undermine the affordability of, Lifeline broadband and voice service offerings to the detriment of those the program is designed to help and before the Commission has the benefit of a marketplace analysis,” they said.

As a result of the increased offering and penetration of unlimited data plans, as well as other marketplace changes, “the application of the formula that takes effect on December 1, 2019 will increase the minimum data usage allowance required for Lifeline-supported plans from 2 GB per month to approximately 9.5 GB per month, an increase of nearly 500 percent in a single day. This is a significantly different result than the gradual ascent that the Commission expected when it adopted the formula in 2016. It would be, instead, a flash jump that the Commission did not anticipate or intend,” they said.

They added, “Such a flash jump would also significantly narrow consumer choice, limiting the variety of service plans available for eligible low-income consumers to choose and requiring eligible low-income consumers to purchase plans that might often include much larger increments of data usage than they need or want. In a closely related context, the Commission recently made changes to the Lifeline rules designed to avoid restricting consumer choice and to protect Lifeline consumers’ ability to ‘obtain those services that best meet their needs.’ The Bureau should take action here, too, to ensure that precipitous changes to the Lifeline program’s requirements do not limit access to services, particularly for the consumers who are least able to pay more substantial out-of-pocket costs.”

As for the issue of continuing support for stand-alone voice services, the petitioners said, “While the purpose of this phase-down is to focus the Lifeline program on broadband services, a significant number of eligible low-income consumers continue to prefer voice-only services or bundles of services that include more voice usage and less data usage. … The most recent Universal Service Administrative Company data shows that, as of February 2019, nearly 42 percent of Lifeline customers still subscribe to plans that qualify for Lifeline by virtue of meeting the minimum service standards for voice service. Without a pause, over 3.8 million Lifeline subscribers will be negatively impacted.” —Lynn Stanton, [email protected]

MainStory: FederalNews FCC UniversalServiceLifeline

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