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Subsidized broadband program speeds up, but Colorado customers must upgrade to keep discount

The federal Lifeline program provides $9.25 to low-income consumers for wireless or broadband service. But the FCC’s upgrade on Dec. 1 may leave some CenturyLink or mobile customers behind -- and with higher bills.

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A national low-income broadband program will get a speed boost on Tuesday as new federal requirements go into effect for the Lifeline service.

But not all Lifeline customers will automatically see the upgrade to 25 megabits per second from 20 mbps for fixed broadband service, or an increase to 11.75 gigabytes of data for wireless customers. 

Over at CenturyLink, customers must upgrade to the faster and likely more costly 25 mbps speed or otherwise lose their Lifeline discount. Failure to upgrade on time would result in a slower than 25 mbps service that Lifeline offers and no discount. CenturyLink, which rebranded this year and is now part of Lumen Technologies, is one of the largest telecoms offering internet and phone service in Colorado. 

CenturyLink, now part of Lumen, offers the Lifeline discount to eligible low-income customers. But to meet the federal requirements of offering broadband speeds of at least 25 mbps, the company told customers to upgrade to the faster speed other lose the Lifeline discount. (Screenshot)

“Effective December 1, 2020, the Federal Communications Commission (FCC) qualification for Lifeline broadband speeds will change from 20M/3M to 25M/3M. Failure to contact CenturyLink, to upgrade your speed, will result in the removal of the Lifeline discount,” notes the company’s website.

Lumen officials won’t say how many customers it has on Lifeline services. And it doesn’t make it easy to see how much faster service costs. According to a Lumen price-check link, 100 mbps service to a home in Denver runs $49 to $65 a month, depending on the promotion. But in Estes Park, a 30 mbps connection is $49. In Montrose, $49 covers the cost of 10 mbps, which would make customers ineligible for the Lifeline discount.

According to the Federal Communications Commission, the federal program provides discounts of $9.25 a month to nearly 60,000 Coloradans. The subsidy can be used for telephone, mobile or broadband service.

The Lifeline program, which started in 1985 as a federal telephone service subsidy, has in the past 15 years expanded into mobile and internet service as more people dropped their landlines. Managed by the Universal Service Administrative Co., the FCC-designated nonprofit operates the program on an annual $10 billion budget to fund service for 7.7 million Americans in rural, underserved or difficult-to-reach areas. 

The FCC has increased minimum internet speeds and data requirements annually since at least 2016, when mobile services were required by the program to offer 500 megabytes of data to customers, while fixed broadband companies had to offer 10 mbps download and 1 mbps upload speeds.

As fixed broadband companies like Lumen must now offer speeds of 25 mbps down and 3 mbps up, wireless companies are required to increase data plans to 11.75 GB per month on Dec. 1, up from 3 GB. However, the FCC allowed mobile companies to get a waiver this year to increase the data capacity to just 4.5 GB. 

But a group of wireless providers represented by the National Lifeline Association protested the smaller increase, saying it still hurts “access and affordability.” 

Wireless providers say increasing the amount of data offered isn’t free for them. Last year, when the FCC’s annual increase to Lifeline’s minimum service required wireless companies to increase to 3 GB from 2 GB, some NLA members stopped offering free devices in order to keep the service free.

And so bumping that data capacity up by 50% on Dec. 1 means raising prices, which for some customers will mean going from paying zero to up to $15 a month, the organization said.

Customers “will be forced to switch from their existing free monthly Lifeline broadband, voice and text plans to new mobile broadband plans that require upwards of a $15 monthly co-pay or to free voice plans that include little or no data,” NLA said in a statement. 

The FCC denied NLA’s petition for a stay to the Dec. 1 increase, but NLA has appealed.

With COVID-19 and social distancing, the necessity of reliable broadband has become imperative, especially in school districts where students with inadequate broadband at home often fail to show up for remote learning, and among workers who’ve lost their jobs and cannot access online job searches from home.

But many eligible Coloradans fail to take advantage of the Lifeline discount, said Laura Ware, who is working on digital literacy issues for the Colorado Center on Law and Policy. 

That’s because of digital divide issues that remain in rural communities where internet infrastructure is subpar, and in urban communities where broadband service is too costly.

“The connectivity is poor or non-existent sometimes,” Ware said. “The infrastructure may be there but the connectivity … going into the home is low speed or intermittent.”

Ware reviewed broadband options for shelters and affordable housing sites in the metro Denver area and found that Lifeline consumers typically used it for phone service. 

In fact, according to data from the USAC, only 12.6% of eligible Coloradans took advantage of the program this year, and 14% of eligible Colorado households are projected to participate next year.

Ware said most low-income consumers are using cheaper alternatives aimed at low-income households, such as Comcast’s Internet Essentials, which is $9.95 a month. Comcast also upgraded all speeds to 25 mbps when the coronavirus pandemic worsened in March.

T-Mobile, which offers Lifeline through Assurance Wireless, recently launched its Project 10Million to help school districts nationwide provide better remote learning services for its students. In Colorado, T-Mobile is providing free mobile hotspots and up to 100 GB of broadband data to 34,000 low-income families. It was part of a renegotiated deal with the Colorado Attorney General’s office originally made last year to allow T-Mobile’s $26 billion merger with Sprint. 

But even with other options available, if customers who rely on the Lifeline discount for broadband service don’t upgrade and thus lose their discount, that’s going to be critical for them, especially during the pandemic, Ware said. 

“While we’re in COVID, any increased cost for essential services, like access to phone and internet, would be a concern,” Ware said. “Losing access to this essential service has become so important, not only because of COVID but because of our society’s reliance on digital technology. I think it’s so much bigger than COVID.”

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