Funding shortfall forces FCC to cut internet subsidies

Indianapolis, Indiana – The Federal Communications Commission reports that almost 23 million families in the United States may see a sharp increase in their monthly internet bills.

Beginning in May, the Affordable Connectivity Program will receive financing from Congress. Families in rural Indiana and those with low incomes may be severely impacted by those cuts. Daybreak’s Jeremy Jenkins was joined by Hugh Odom, a telecom expert and the founder and president of Vertical Consultants, to provide clarification.

“The affordable connectivity program was started back in the start of 2022. The reason being is as we learned during the COVID era that we rely very much on business applications, educational applications, and more particularly telehealth applications on connectivity to the internet wireless service, etc.,” Odom said.

Customers in the program, who were primarily older and of lower income, were eligible for a $30 internet service discount. The Affordable Connectivity Program is saving 425,968 households in Indiana—1 in 6 homes in the state—money on their internet costs, according to White House figures.

“In about a month or so, you’re going to lose that funding. And as a result, many people are not going to be able to have that connectivity to the internet,” Odom said.

Odom believes there are two ways to get money to keep the program going since millions of people depend on it.

“One, there’s a push, a bipartisan push to get this funding extended a $7 billion extension that would help this and keep up that, that subsidization available for low-income and older people across the United States,” Odom said.

According to Odom, the FCC’s efforts to pressure carriers to lower their rates and offer gap coverage represent the second option.

“I don’t know if that’s going to happen… What may happen is you’ll see a lot of these carriers, wireless carriers, etc. going out and offering a discount service. But with a discount service, you may get a lot less availability to certain aspects of your internet that you have right now,” Odom said.