Policy

The FCC’s emergency internet discounts are leaving millions behind

The FCC's $3.2 billion emergency broadband benefit program has seen slow adoption rates with stark geographic disparities.

An internet router

According to a new report by the Benton Institute for Broadband & Society, only one in 12 households that are eligible for the EBB program are currently enrolled.

Photo: Stephen Phillips/Unsplash

Nearly 4 million households have enrolled in the Federal Communications Commission's emergency broadband benefit program since it launched in May. But as researchers have begun digging into data recently released by the FCC, they're finding that not only are the vast majority of eligible Americans still being left out of the $3.2 billion program, but there are also stark geographic differences in where people are being enrolled.

According to a new report by the Benton Institute for Broadband & Society, only one in 12 households that are eligible for the EBB program are currently enrolled. That's based on an analysis of American Community Survey data and other public benefit data, which found that some other 36 million American households may qualify for the benefit overall.

The study also found that major cities including Houston and Chicago are falling far behind in terms of their enrollment rates, while Puerto Rico and cities including New Orleans, Detroit, Milwaukee, Baltimore, Cleveland and Philadelphia are seeing higher rates of adoption.

That part, at least, is encouraging, says John Horrigan, a senior fellow at the Benton Institute who authored the report, because these are cities that have traditionally had low rates of broadband use. "It's good that the data makes sense," Horrigan said.

But others are not so encouraged. "The data shows that the benefit is not getting adopted at the rate you might hope and might have expected given the magnitude of the assistance available and who's eligible," said Jonathan Mayer, assistant professor of computer science at Princeton University and former chief technologist of the FCC. "I think it's now very likely that the overwhelming majority of the EBB will be unspent by the time the pandemic has come to a close for many Americans."

In a statement, an FCC spokesperson noted that the EBB program had been set up "in record time."

"We're happy that Mr. Horrigan and others are diving into all of the data we're making available and bringing to light new insights that will help the FCC and others make the program a success," the spokesperson said.

Mayer did some number crunching of his own when the FCC released its first batch of enrollment data last month. He found that while enrollment rates were fairly low across the country, three areas stuck out as outliers with particularly high adoption: one area that includes Apache County, Arizona; another that includes McKinley County, New Mexico; and a pocket of Eastern Kentucky.

Mayer dug deeper and found that all of these areas are home to small, locally focused internet service providers that appear to be more proactive about enrolling people in the program. "Communities that have ISPs that are oriented toward the community are adopting this at higher rates," Mayer said, though he cautioned that his findings are preliminary. These are also areas that have high rates of poverty, which means the need for the EBB program in those places is likely greater.

Still, there is ample evidence that large ISPs have erected barriers that could discourage eligible Americans from enrolling. Spectrum, for one, was requiring people to agree to continue service at undiscounted rates after the EBB runs out. Verizon, meanwhile, was forcing customers into more expensive plans in order to qualify for the service. Both companies later changed these policies.

"There's this conflict of interest where carriers are not super interested in customers who are not going to subscribe to fancy plans and might have trouble paying" after the benefit expires, Mayer said.

Small, local providers, Mayer and others argue, often have a different set of motivations than their multi-billion dollar national counterparts. "They're not there solely to extract wealth," said Chris Mitchell, director of the Community Broadband Networks Initiative at the Institute for Local Self-Reliance. "They're going to spend more effort trying to get people online with any tool that's available."

One such provider that popped up in Mayer's research was Sacred Wind Communications, which serves tribal and rural areas in a part of New Mexico where the poverty rate is about five times the national average. It's also a part of the country with one of the highest rates of EBB adoption, according to Mayer's calculations, with north of 35% of households already enrolled in the program.

CEO John Badal said he founded Sacred Wind in 2006 specifically to provide infrastructure to people who had been "neglected" by large telecom giants. "That neglect went well beyond telecom. It's education and health care and roads and water," Badal said, noting that 40% of Sacred Wind's customers don't have indoor plumbing.

The vast majority of Sacred Wind's customers already qualify for Lifeline, a government benefit for low-income Americans that reduces their monthly phone and broadband payments somewhat. But still, Badal said, a large number of customers struggle to pay. When the EBB program came along, Badal said it was "a gift for us and for our customers," covering the full cost of customers' monthly bills.

"Because of their financial circumstances, the delinquency rate of our customers is a lot higher than what I've experienced at any other phone company," said Badal, who previously worked at AT&T and Qwest Communications. Now, he said, "We call the customer or they call us about the failure of payment, and we now have something to offer them to keep their broadband service alive." The company has already enrolled about 500 of its 2,000 broadband customers in the EBB program, with another 300 being onboarded now.

Of course, while that's a big chunk of Sacred Wind's customer base, it's a drop in the ocean of Americans who are eligible for the program but have yet to be enrolled. Mitchell called it "a huge failure of the program and its design" that so few people who qualify for the subsidy are receiving the assistance two months in. He attributes that failure to Congress's decision not to set aside funding to promote the program. "You're distributing billions," Mitchell said. "You should have a plan for how to make it available."

For Mayer, the EBB rollout has been a sort of natural experiment, testing why Americans in general enroll in broadband subsidies at such low rates. Similar questions have plagued the Lifeline program. One hypothesis has been that the benefits from Lifeline — up to $9.25 a month and up to $34.25 per month on tribal land — are simply too small to be enticing. Another hypothesis — the one Mayer subscribes to — is that people either don't know about these programs or they struggle to sign up for them, because leading ISPs have little motivation to push people into low-cost plans.

The anemic adoption rates for the EBB, which offers up to $50 monthly discounts for broadband, seems to point toward a clear answer, Mayer argues. "I think what's going on with the EBB lends a lot of credibility to the hypothesis that what we have here are discoverability and usability problems," he said. "This is a lot of money for a good cause that low income households are entitled to, and that money is not flowing to those households."

This story was updated to reflect that Spectrum has since changed its policy regarding EBB opt-in.

Fintech

Judge Zia Faruqui is trying to teach you crypto, one ‘SNL’ reference at a time

His decisions on major cryptocurrency cases have quoted "The Big Lebowski," "SNL," and "Dr. Strangelove." That’s because he wants you — yes, you — to read them.

The ways Zia Faruqui (right) has weighed on cases that have come before him can give lawyers clues as to what legal frameworks will pass muster.

Photo: Carolyn Van Houten/The Washington Post via Getty Images

“Cryptocurrency and related software analytics tools are ‘The wave of the future, Dude. One hundred percent electronic.’”

That’s not a quote from "The Big Lebowski" — at least, not directly. It’s a quote from a Washington, D.C., district court memorandum opinion on the role cryptocurrency analytics tools can play in government investigations. The author is Magistrate Judge Zia Faruqui.

Keep ReadingShow less
Veronica Irwin

Veronica Irwin (@vronirwin) is a San Francisco-based reporter at Protocol covering fintech. Previously she was at the San Francisco Examiner, covering tech from a hyper-local angle. Before that, her byline was featured in SF Weekly, The Nation, Techworker, Ms. Magazine and The Frisc.

The financial technology transformation is driving competition, creating consumer choice, and shaping the future of finance. Hear from seven fintech leaders who are reshaping the future of finance, and join the inaugural Financial Technology Association Fintech Summit to learn more.

Keep ReadingShow less
FTA
The Financial Technology Association (FTA) represents industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.
Enterprise

AWS CEO: The cloud isn’t just about technology

As AWS preps for its annual re:Invent conference, Adam Selipsky talks product strategy, support for hybrid environments, and the value of the cloud in uncertain economic times.

Photo: Noah Berger/Getty Images for Amazon Web Services

AWS is gearing up for re:Invent, its annual cloud computing conference where announcements this year are expected to focus on its end-to-end data strategy and delivering new industry-specific services.

It will be the second re:Invent with CEO Adam Selipsky as leader of the industry’s largest cloud provider after his return last year to AWS from data visualization company Tableau Software.

Keep ReadingShow less
Donna Goodison

Donna Goodison (@dgoodison) is Protocol's senior reporter focusing on enterprise infrastructure technology, from the 'Big 3' cloud computing providers to data centers. She previously covered the public cloud at CRN after 15 years as a business reporter for the Boston Herald. Based in Massachusetts, she also has worked as a Boston Globe freelancer, business reporter at the Boston Business Journal and real estate reporter at Banker & Tradesman after toiling at weekly newspapers.

Image: Protocol

We launched Protocol in February 2020 to cover the evolving power center of tech. It is with deep sadness that just under three years later, we are winding down the publication.

As of today, we will not publish any more stories. All of our newsletters, apart from our flagship, Source Code, will no longer be sent. Source Code will be published and sent for the next few weeks, but it will also close down in December.

Keep ReadingShow less
Bennett Richardson

Bennett Richardson ( @bennettrich) is the president of Protocol. Prior to joining Protocol in 2019, Bennett was executive director of global strategic partnerships at POLITICO, where he led strategic growth efforts including POLITICO's European expansion in Brussels and POLITICO's creative agency POLITICO Focus during his six years with the company. Prior to POLITICO, Bennett was co-founder and CMO of Hinge, the mobile dating company recently acquired by Match Group. Bennett began his career in digital and social brand marketing working with major brands across tech, energy, and health care at leading marketing and communications agencies including Edelman and GMMB. Bennett is originally from Portland, Maine, and received his bachelor's degree from Colgate University.

Enterprise

Why large enterprises struggle to find suitable platforms for MLops

As companies expand their use of AI beyond running just a few machine learning models, and as larger enterprises go from deploying hundreds of models to thousands and even millions of models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

As companies expand their use of AI beyond running just a few machine learning models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

Photo: artpartner-images via Getty Images

On any given day, Lily AI runs hundreds of machine learning models using computer vision and natural language processing that are customized for its retail and ecommerce clients to make website product recommendations, forecast demand, and plan merchandising. But this spring when the company was in the market for a machine learning operations platform to manage its expanding model roster, it wasn’t easy to find a suitable off-the-shelf system that could handle such a large number of models in deployment while also meeting other criteria.

Some MLops platforms are not well-suited for maintaining even more than 10 machine learning models when it comes to keeping track of data, navigating their user interfaces, or reporting capabilities, Matthew Nokleby, machine learning manager for Lily AI’s product intelligence team, told Protocol earlier this year. “The duct tape starts to show,” he said.

Keep ReadingShow less
Kate Kaye

Kate Kaye is an award-winning multimedia reporter digging deep and telling print, digital and audio stories. She covers AI and data for Protocol. Her reporting on AI and tech ethics issues has been published in OneZero, Fast Company, MIT Technology Review, CityLab, Ad Age and Digiday and heard on NPR. Kate is the creator of RedTailMedia.org and is the author of "Campaign '08: A Turning Point for Digital Media," a book about how the 2008 presidential campaigns used digital media and data.

Latest Stories
Bulletins