FCC chair stuns consumer advocates with move that could hurt poor people

Jon Brodkin

Dominik Meissner

It's no surprise that US Federal Communications Commission Chairman Ajit Pai rolled back some of the changes made by former Chair Tom Wheeler. After Donald Trump's election ensured that the FCC would switch to Republican control, Pai warned Wheeler against "midnight regulations" that can "quickly be undone" by new leadership. On Friday last week, Pai undid a few Wheeler-era decisions while saying that actions no longer supported by the commission's majority "should not bind us going forward."

But one decision in particular is galling to advocates for low-income Americans who can't afford broadband Internet service. As we reported, the FCC on Friday told nine companies that they can no longer provide subsidized broadband to customers who qualify for the Lifeline program. This 32-year-old program gives poor people $9.25 a month toward communications services, and it was changed last year to support broadband in addition to phone service.

FCC procedures make it easy to overturn any recent action, and these nine companies gained their Lifeline broadband approvals late in Wheeler's tenure. Pai's FCC says the commission wants to implement new measures to combat fraud and waste in the Lifeline program and that revoking the Lifeline designations will provide additional time to achieve that. But none of the nine providers was accused of fraud, and the FCC already has the power to investigate and punish any provider that defrauds the program. Pai could have let these companies continue selling subsidized broadband to poor people as long as they committed no fraud, but he chose not to.

Lifeline-eligible customers can try to find another Lifeline provider, but the FCC acknowledged that its decision may cause some poor people to have to pay an extra $9.25 a month. One ISP had already started providing the subsidized service and was ordered to notify its customers that they can no longer receive Lifeline discounts.

Needy families lose out

American Library Association President Julie Todaro said the group is "alarmed by the sudden revocation of the nine Lifeline Broadband Provider designations. Reducing options for Lifeline broadband services is a step back in efforts to close the homework gap and digital divide, and is at odds with Chairman Pai’s stated desire to advance digital empowerment."

Consumer advocacy group Public Knowledge said that Pai's "arbitrary decision will likely result in needy families losing access to the critical connectivity they use to communicate with loved ones, look for employment, complete homework assignments, access vital health care information, and engage in civic life."

Free Press, another consumer advocacy group, said that "Chairman Pai is undoing important work that promised to bring the benefits of broadband to low-income families."

FCC Commissioner Mignon Clyburn, a Democrat, said that Pai's action "widens the gap" in broadband availability between rich and poor, and it harms the ISPs that were relying on the Lifeline designation. "These providers include a minority-owned business, a provider enabling students to complete their homework online, and others serving tribal lands," Clyburn said.

In addition to the Lifeline decision, the FCC on Friday rescinded a determination that AT&T and Verizon Wireless violated net neutrality rules with paid data cap exemptions. That move was no surprise, as Pai consistently opposed the investigation and has vowed to overturn net neutrality rules.

Pai's FCC also rescinded a few reports that made some recommendations but didn't bind the commission to any specific action. One of the newly rescinded reports provided an update on the E-rate program's progress in expanding Wi-Fi support in schools and libraries. A white paper on cybersecurity risk reduction was rescinded, and a paper on improving the nation's digital infrastructure was rescinded. No reasons for the rescissions were given other than Pai's statement that the FCC's new leadership shouldn't be bound by any of Wheeler's "last-minute actions."

“Directly contradictory to chair’s stated goal”

The various reversals last week essentially "flush[ed] months of the FCC staff’s work down the drain," Public Knowledge Senior Policy Counsel Phillip Berenbroick told Ars. This occurred less than two weeks after Pai spoke to employees and said the FCC has "the most professional staff any agency could be blessed with."

In that speech to staff, Pai also said one of his top goals is "bringing broadband to all Americans." He made similar comments a few days later when presiding over his first meeting as chair. But reversing the Lifeline broadband designations erodes one of the FCC's core missions, that of making service available and affordable to poor people, Berenbroick said.

"It is directly contradictory to the chairman's stated goal. It took him all of three days to walk back the stated goal of his entire chairmanship," he said. Given that Pai repeatedly accused Wheeler of shunning bipartisanship and transparency, "you would imagine there would be more transparency and more effort to find bipartisan consensus here," Berenbroick said.

It's not clear yet whether the nine providers that lost their Lifeline designations will get them back or when other companies will be approved. Clyburn urged Pai to keep the companies' requests in the queue and consider them "expeditiously."