TR Daily Divided FCC Modifies Lifeline Mobile Broadband Data Usage Minimum
Tuesday, November 19, 2019

Divided FCC Modifies Lifeline Mobile Broadband Data Usage Minimum

Over the dissent of Democratic Commissioners Jessica Rosenworcel and Geoffrey Starks, the FCC today waived in part a provision of its Lifeline rules that would have required mobile broadband service providers to allow Lifeline subscribers at least 8.75 gigabytes of data usage per month.

However, it declined to halt a decrease in the monthly subsidy for Lifeline voice service from $9.25 to $7.25 per subscriber scheduled to take effect on Dec. 1.

The Commission was responding to a petition from CTIA and four consumer, public interest, and civil rights groups that sought waivers of 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” (TR Daily, June 28).

CTIA, 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 argued 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.”

In the order adopted Nov. 15 and released today in WC dockets 11-42, 09-197, and 10-90, the FCC said, “We find that, given the unexpectedly large growth in mobile broadband usage over the past three years and the resultant unexpectedly large increase to the minimum service standard that results from the formula the Commission adopted in 2016, good cause exists to partially grant CTIA’s petition on this issue. Specifically, we waive the rule to the extent it would establish a minimum service standard greater than 3 GB per month, beginning on December 1, 2019. In contrast, we further find that Petitioners have not shown that good cause exists to halt the scheduled phase-down of support for Lifeline voice service, and we therefore deny that portion of the Petition.”

It added, “Though the record contains no clear evidence on the extent of additional costs, which makes it difficult to precisely quantify the likely effect of an increase in the minimum usage allowance, we find it reasonable to anticipate that a more than four-fold increase in the minimum usage allowance would require substantially greater network resources, and, in turn, the associated costs would be passed along to resellers and/or end-users. Absent a more substantial transition period, the large increase in the minimum standard for mobile broadband usage could unduly disrupt service to existing Lifeline subscribers. We thus find that the potential benefits of a significantly increased mobile broadband usage standard are outweighed by the possible hardship that could be imposed on Lifeline subscribers.

“Indeed, the significant increase in the standard from 2 GB to 8.75 GB/month is inconsistent with the Commission’s apparent vision for increases in minimum standards. When it implemented the mobile broadband usage standard in 2016, before allowing the formula to set the mobile broadband standard in 2019, the Commission established an annual and predictable incremental increase by increasing the minimum standard from 500 MB/month to 1 GB/month for the second year and then increasing that amount again by 1 GB/month for a total of 2 GB/month for the third year. This stair-step approach to increasing the standard not only allowed Lifeline carriers time to plan for the increase and adjust their Lifeline offerings and operations accordingly, but it also established the precedent of no more than doubling usage from one year to the next,” the FCC said.

However, it said, “We disagree with commenters that argue that the minimum standard should not increase at all above the existing 2 GB/month standard at this time.38 As explained above, the Commission decided that Lifeline subscribers should not be given only ‘second class’ service—and that the minimum standards were designed to ‘eliminate’ low-quality services from the program (or, put another way, to ‘remove the incentive for providers to offer minimal, un-innovative services’). And we find that limiting Lifeline subscribers to a usage allowance of less than half of what other smartphone subscribers actually use today would be affording them only second class service—precisely what the Commission deemed unacceptable.”

In her separate statement, Commissioner Rosenworcel said that since the FCC’s adopted the rules at question in the order, “it has become apparent that those who rely on Lifeline still depend deeply on the program for voice services and the formula used to update data minimums may have unintended consequences. In other words, while the market has evolved, it has not moved in the ways we previously imagined.”

She added that the petitioners “made a compelling case that further study is warranted before making these adjustments because the impact of the changes could be severe. I think that under the circumstances, this kind of pause is a smart approach. In fact, I think it would be the best course for the FCC and the program right now. I regret that my colleagues do not agree. For this reason, I choose to dissent.

“Finally, while I am sympathetic to the increase in minimum data allowances that are part of this decision, I fear this does nothing to provide the certainty we need for this program. In fact, without pausing for review, the FCC will simply be back in the same place, wrestling with the same issues, and more of the same scheduled service adjustments at this time next year,” Commissioner Rosenworcel concluded.

In his separate statement, Commissioner Starks said that the expectations of the Commission in the 2016 Lifeline order “are not the reality we have today, and this is why a petition was filed earlier this year to pause the changes set to go into effect on December 1, 2019.

“In fact,” he added, “the Order before us today acknowledges that there is a misalignment between current marketplace dynamics and the Commission’s efforts to set standards for the program, including the large increase in the required data allotment. The Bureau is working on a report that will give us a better understanding of the Lifeline market. Until that report is completed and analyzed, it is my belief that we should refrain from making any additional changes until we have the necessary data to make informed decisions, rather than rushing to impose standards that may have far-reaching ramifications on the program.

“Additionally, it is important to note that the record reflects overwhelming support for pausing the voice-only phase down. The fact of the matter is that the voice-only phase down will likely have a real impact on the nearly one million people who subscribe to these services. I fear that our poorest Americans now risk losing their link to emergency services, doctors, employers, and family. For all of these reasons, I dissent,” Commissioner Starks concluded. —Lynn Stanton, [email protected]

MainStory: FederalNews FCC UniversalServiceLifeline

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