Tag Archives: ACP

BEAD and Affordability

One of the big glaring weaknesses of BEAD was that the enabling legislation and the NTIA rules made it impossible to consider affordability as a criterion of selecting BEAD grant winners. A few states tried to stress affordability during the BEAD process, but were largely shut down by the NTIA. After the Benefit of the Bargain rules, consideration of affordability went out the door, along with all factors other than the construction cost per passing.

In a speech made to the Hudson Institute, NTIA Assistant Secretary Aerielle Roth was quoted as saying, “This administration does not want BEAD to become just another well-intentioned broadband program that falls short. Its mission is nothing less than to close the “digital divide” once and for all.”

Unfortunately, the BEAD infrastructure grants alone were never going to close the digital divide. When we talk about solving the rural digital divide, we’re really talking about several different issues. A primary element of solving the digital divide is broadband availability, which is what infrastructure grants tackle. BEAD focused on making sure that BEAD-eligible locations got at least one broadband option with a speed of at least 100/20 Mbps.

Solving the digital divide means two more things. First, it means making sure that people have computers and devices and know how to use them effectively. Finally, solving the digital divide means having broadband that people can afford.

Congress intended to tackle all these elements of the digital divide solution. The Digital Equity Act was intended to provide the funding needed to make sure that folks had devices and knew how to use them. That effort was going to be bolstered by BEAD non-deployment funds that didn’t get used for infrastructure. Unfortunately, NTIA and the Administration have refused to distribute the funding from the Digital Equity Act, and it appears likely that most or all of the non-deployment funds won’t be made available to States.

At the time that the BEAD legislation was approved, the ACP program was underway to provide low-income homes with a monthly $30 discount off broadband. The BEAD legislation mandated that BEAD winners enroll and use the ACP program. Unfortunately, Congress let that program lapse.

There were State Broadband Offices that tried to tackle the affordability issue through the scoring of grants. These States tried to assign a lot of grant points to ISPs that offered lower rates. For example, the proposed grant scoring in some states would have given an edge to a cooperative with $65 rates over satellite broadband priced at $120 or another ISP with $100 rates.

The BEAD legislation said that States couldn’t use BEAD rules to ‘set rates’, and there were a few States that tried to do that in their grant scoring and tried to force rates as low as $30 or $40. NTIA nixed State attempts to force lower rates even before this year’s Benefit of the Bargain rules.

It’s a shame that overall rates couldn’t be considered in BEAD, because household incomes are lower in rural areas than in non-urban areas, meaning that affordability is more of an issue in rural areas. This is not true for all BEAD areas, but many of the areas covered by BEAD are both rural and poor. According to statistics published by the Federal Housing Finance Agency at the end of 2024, 18% of rural homes have household incomes under $25,000 per year, compared to 15% in non-rural areas. There is also a significantly higher percentage of rural homes with household incomes between $25,000 and $50,000 (21% vs. 17%).

To me, the bottom line is that BEAD is not going to solve the rural digital divide since it focuses only on infrastructure. NTIA has to shoulder the blame for nixing the grant funding that would have provided devices and digital skills training. Congress has to take the blame for ignoring profitability when it required  ACP participation as a component of BEAD, and then let ACP lapse without a replacement.

Charter Sued Over ACP Losses

In recent years, it seems that when there is a sudden drop in the stock price for a publicly traded company, a class action suit will soon follow. In the broadband industry, Charter was recently sued after its stock dropped $70.25 per share on July 25, from a price the day before of $380 per share.

The stock price dropped after Charter announced its earnings results on July 24 for the second quarter of 2025. The class action suit blames the sudden stock price drop on Charter’s misleading statements about the impact of the end of the ACP program. That program provided a $30 subsidy for home broadband for qualifying low-income households. Charter was the most aggressive ISP in the ACP program and had enrolled around 5 million households. When Charter discussed its second quarter results, the company said that it lost 117,000 broadband customers for the quarter, and that 50,000 of  those losses were the residual impact of the end of ACP.

Charter explained that the 50,000 customers it lost were due to households unable to afford monthly payments – something that it believes would not have occurred if ACP were still in place. These weren’t ACP customers, since that plan ended a year earlier, but the customers were similar to those who had been enrolled in ACP.

I did a little digging to look deeper at the facts. I was curious how Charter’s customer losses compared to those of other publicly traded cable companies. The following chart shows the customer performance for each company since the end of 2023.All of the big cable companies are losing customers – something that is a constant headline for the industry. Analysts pin most of these losses on fierce competition from FWA cellular carriers and fiber overbuilders, both of which have been adding customers at a rapid pace over the last two years. The chart shows that Charter has done a better job of minimizing customer losses than all of the other publicly traded cable companies. Over 18 months, Charter lost 2.2% of its 4Q23 customers, a lower percentage drop than the other companies.

The loss of ACP customers wasn’t the only bad news in the Charter earnings release. Charter announced earnings per share of $9.18, up from $8.49 per share a year earlier. But according to stock analysts, the earnings were lower than the expected earnings of over $10 per share. Possibly due to the expectations of higher expected earnings, Charter stock had climbed to a high price of $427.25 on May 16, 2025.

The Charter stock price drop also can’t be blamed on the overall market, because on July 25, the S&P 500, the Nasdaq Composite, and the Dow Jones Industrial Average all rose to near all-time highs for each index.

I am the last person you’d ever ask for stock advice, and big market swings like this are a mystery to me. But still, when looking at the facts, it’s hard to think that a company with 30 million broadband customers would be dinged by an 18% stock price drop due to losing only 50,000 low-income customers. However, that is certainly possible, and I guess a jury will have to eventually figure it out.

ACP Saved More than it Cost

A new report by The Brattle Group found that the Affordable Connectivity Program (ACP) generated more savings for the federal government than its cost. The study is worth reading from end to end, including the many studies cited in the footnotes. The study focused on the benefits that ACP brought to Medicare, Medicaid, and veterans health through telemedicine visits. Brattle concluded that the $7.3 billion annual cost of the ACP program paled compared to their estimated savings of $28.9 to $29.5 billion from these federal healthcare programs.

The savings from using telemedicine instead of live doctor visits are dramatic. They estimate that the savings from one telemedicine visit saves the equivalent of 3.5 years of ACP support for a Medicaid recipient. The report cites estimates that telemedicine visits are 23% less expensive than in-person visits. They cite studies that show that telemedicine visits for cancer patients save between $147 – $186 for each visit. Telehealth visits with medical specialists average $120 less, and virtual urgent-care visits save $141 compared to in-person clinic visits.

Hospitals that offer telehealth emergency departments have shown big cost savings. A 2023 Department of Veterans Affairs (VA) study found that veterans using a new tele-emergency service were nearly 50% less likely to visit an emergency department in person, reducing short-term emergency visits outside the VA system. Another study found that the average annual savings for a patient who regularly participates in telehealth is $6,500.

The study also looked at a few of the other societal benefits of the ACP program. For example, they point out studies that show that having home broadband increases academic achievement for students, which ultimately means higher lifetime earnings. They highlighted research that shows that universal access to broadband could increase U.S. GDP by 1.1% – a gain of $160 billion per year. Home broadband makes it easier to find a job and also allows households to participate in the remote work economy. The report doesn’t look deeper, but there are dozens of other community and societal benefits to having households connected to broadband.

Unfortunately, our regulatory and legislative structures tend to look at topics in silos. Legislators and policy-makers looked at ACP as a broadband issue and did not look at the wider and larger benefits that ACP and the resulting broadband brings to a household and in mass to communities.

The study suggests that the Congressional Budget Office should be allowed to score the savings coming from ACP by considering the Medicaid program. Brattle suggests that saving alone is about $6 billion per year, which alone would justify the annual cost of ACP. They say there are larger savings when looking at Medicare and medical spending covered by Veterans Affairs.

The study estimates that the telemedicine benefit to the federal government is four times the cost of ACP. Even if the Brattle Team’s assumptions are skewed, and the saving are only half what they claim, the savings from just federal medical spending alone would be twice the cost of funding ACP. The savings would be off the scale when looking at a wider list of societal benefits – but in the world of scoring federal programs, such costs are considered to be externalities and are not part of the calculation.

More States Considering Low Broadband Prices

Now that New York’s Affordable Broadband Act has gone into effect, other states are looking to mandate low broadband rates for low-income households. The New York law went into effect when the U.S. Supreme Court refused to hear an appeal of the case.

State Senator Pavel Pavano of Massachusetts proposed SD1200, “An Act preserving broadband service for low-income consumers”. This law proposes that all ISPs offer 100 Mbps broadband to qualified low-income households for $15 per month. This fee must include equipment rental and any usage charges, meaning no separate charges for modems or for data caps. Unlike New York, there is no exception for small ISPs. The qualification for the discount seems to match the qualification used for the now-defunct federal ACP plan. Once every five years, ISPs can increase rates by the lesser of 2% or the most recent annual increase in the consumer price index. ISPs also can offer 200 Mbps for $20 per month, with a rate increase allowed every two years.

In California, Assemblymember Tasha Boerner introduced  AB 353 that provides broadband discounts for low-income households. The bill generally requires ISPs to offer affordable home broadband to customers. This proposed law doesn’t yet suggest any specific rates or broadband speeds, but the intention of legislators is to add that requirement at some point.

The proposed bill is being linked to the larger Digital Equity Bill of Rights legislation and introduces the legislative concept that ISPs should have affordable rates.

There may be more legislation coming from around the country. Twenty-two states filed a brief in support of New York when the issue was being considered by the Supreme Court. The petition supported the concept that States have the right to set broadband rates when the FCC and the federal government decides to not do so. The petition was signed by California, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington and Wisconsin, and the District of Columbia. Many of these states might have been supporting the idea of states’ rights, so we’ll have to see how many eventually result in broadband legislation.

As would be expected, ISPs are already reacting to these proposed laws. A number of ISPs are actively lobbying against the proposed bill in Massachusetts.

A group of ISPs have also petitioned the Supreme Court after its decision and asking the Court to rethink about taking the issue. While nothing is impossible, courts don’t normally change their mind about what goes on a docket. However, there will likely be new appeals if the Massachusetts or California bills become laws.

Seeing the Impact of ACP

The Affordable Connectivity Program lapsed in May of this year. At the time the program ended there were more than 13 million ACP recipients getting a discount on a cellphone plan and 10 million getting a discount on landline broadband. Charter had fully embraced ACP and was reported to have over half of the landline ACP participants.

There were dire predictions at the end of the ACP that many millions of households would drop landline broadband since they could no longer afford it. For example, a survey conducted by the Benton Institute in June reported that 13% of ACP recipients would be forced to drop home broadband. The Benton survey showed that as many as 43% of low-income homes are subscription vulnerable, meaning they struggle to pay a broadband bill.

Any immediate impact of the end of ACP was softened as many ISPs extended ACP benefits for a few months out of their own pockets in the hope that Congress would pass legislation to continue the plan. That likely pushed any noticeable impact from ACP out until late summer.

Many ISPs also offered an alternative low-income plan for qualified customers. It’s possible these low-income plans have enabled households to stay connected.

  • Charter kept its Spectrum Internet Assist plan that offers 50 Mbps for $24.99, with the speed for an extra $5.
  • AT&T continued its Access from AT&T that provides 100 Mbps on fiber for $30.
  • Comcast kept its Internet Essentials plan that provides 50 Mbps for $9.95.
  • Cox kept its Connect2Compete plan for households with students that provides 100 Mbps for $9.95 and $30 for other households.
  • Mediacom offers its Xtreme Connect plan for $28.99 per month, which is reduced to $14.99 for homes with students.

We got a glimpse into the impact of the end of ACP recently when Comcast announced third quarter financial results. Comcast reported that it lost 96,000 net customers in the quarter as a result of ACP, and without the ACP losses the company would have experienced a tiny gain of 9,000 customers. As a side note, this adds to the mystery of where FWA carriers are finding customers, since FWA carriers gained 913,000 customers in the third quarter.

Charter is more of a puzzle. The company announced recently that it lost 113,000 customers in the third quarter. Charter estimated that it lost 200,000 ACP customers, and without that loss it would have had a net positive gain of 87,000 customers for the quarter. If there any validity to the results of the Benson survey, Charter might be expected to eventually lose as many as 650,000 customers due to the end of ACP. Perhaps that will come to pass, and perhaps this is just the first set of losses, with other customers trying to hang on to broadband. The Charter gains after accounting for ACP is also a mystery when you consider the big gains for the FWA carriers in the third quarter. Maybe part of that answer to Charter’s growth comes from adding customers as a result of construction in RDOF and areas funded by state broadband grants.

On a national scale, there doesn’t seem to be a big customer drop as predicted by various surveys. If 13% of ACP recipients (1.3 million households) dropped broadband, it would be obvious in the quarter-to-quarter customer counts of big ISPs – and it’s not.

I think it’s more likely that the results of the end of ACP will be more subtle, spread over time, and be harder to notice. While some homes likely dropped immediately, many have likely held on with one of the low-income alternatives offered by ISPs. Homes that find they can’t sustainably afford broadband will drop off over time and likely not make a noticeable ripple in the national numbers.

The real victims of the end of ACP are customers of ISPs that have been building broadband networks in low-income neighborhoods or tribal areas and that relied on ACP payments to make a business case. I expect to hear stories over the next year of some of these ISPs having to shut the door.

The Barrier to Closing the Digital Divide

In a finding that will surprise nobody, Pew Charitable Trust analyzed all of state plans related to the Digital Equity Act (DEA). This is the grant program that is aimed at tackling barriers to broadband adoption, such as getting computers into homes, providing training on how to use technology and the Internet, and increasing broadband adoption rates. Pew found that every state and territory says that the primary barrier to closing the digital divide is affordability.

The DEA is the first federal grant aimed at directly tackling digital equity barriers – previous federal grants have largely concentrated on broadband infrastructure. The DEA will provide grants administered directly by NTIA and is also providing funding for every state to make local grant awards.

States area really struggling with the affordability issue after Congress let the Affordable Connectivity Plan (ACP) lapse – the plan that provided a $30 monthly discount for low-income households. ISPs had responded well to the ACP program. For example, the biggest cable companies offered plans that were zero cost to customers who qualified for ACP, or that let them take the discount for faster-speed plans. States could see that ACP was getting broadband into millions of homes that would not have otherwise afforded it.

A lot of states were expecting to use the DEA grant funding to help people enroll and take advantage of the ACP plan. The vision was that there would be a home broadband plan that every household could afford. The DEA funding was also going to be used to buy computers for homes and to train people on how to best use the Internet.

It’s easy to say in retrospect that every State, County, or non-profit that proposed to use ACP as the primary tool for solving the digital divide was somewhat naïve. It was clear from the start that the ACP program only had enough funding for a few years and that Congress would need to act to keep the plan going. We’ve had a Congress for over a decade that struggles to pass needed legislation. Lawmakers from both parties sponsored bills to continue the ACP, but no bills ever got enough support to even get a Committee vote.

States are now scrambling to find alternative ways to improve broadband in communities with low broadband penetration. The Pew article outlines a few such efforts being tried in communities:

  • Expand free WiFi at community anchor institutions to provide more places for the public to connect to the Internet.
  • Bring free broadband to public housing.
  • Bring free WiFi to parks and other commonly used outdoor locations.
  • Establish tech hubs where people can not only get free WiFi but can use public computers and get trained on how to use computers and broadband.
  • Lending programs to get Internet-connected devices to the public.
  • Establish telemedicine hubs.
  • Fund WiFi infrastructure for newly constructed low-income housing.

These are all great ideas, but they are all not nearly as beneficial as getting broadband directly into every home. I wrote a blog in 2020 about a study done by the Quello Center, which is part of the Department of Media and Information at Michigan State. This study was conducted in a way to isolate the results from factors such as household income and race, and it showed definitive proof of the advantages to students of having a computer and broadband in the home. One of the most stunning findings of the study was that “The gap in digital skills between students with no home access or cell phone only and those with fast or slow home Internet access is equivalent to the gap in digital skills between 8th and 11th grade students.”

States rightfully still have a goal to get broadband into every home, and a handful of States are looking for ways to create a State broadband subsidy similar to the ACP. State funding such plana is expensive, but this might be one of the most beneficial ways that a State government can help low-income households.

It’s frustrating to see government programs that work die from lack of funding. Pew has been one of the strongest proponents of continuing the ACP plan. But it feels like every day that goes by, the more remote the chance of the ACP being resurrected.

FWA and the Urban Digital Divide

The end of ACP put the kibosh on the business plans of ISPs working to tackle the urban digital divide. I’m aware of a several ISPs working to bring broadband to neighborhoods where the majority of customers qualified for the $30 ACP discount. These business plans only made sense because a chunk of the revenue was guaranteed by ACP.

While some say that ACP is not yet dead, at this point, it looks like it will take a miracle, or at least a powerful champion in DC, to reinstate something like the ACP. I’ve been brainstorming with communities about alternatives to ACP, and I’m starting to think that perhaps FWA cellular service is the next best alternative.

I’ve had access over this past year to large volumes of Ookla speed tests in different markets, and what I’ve seen is that FWA cellular carriers are successfully delivering speeds of 100 – 300 Mbps within a mile or two of a cell site. I’ve seen neighborhoods on the FCC map where Verizon is now claiming gigabit capability, but I haven’t seen any speed tests yet in those areas to see what that means in real life. However, wireless broadband speeds get a bit wonky in cities where small dead zones pop up in the shadow of hills or buildings that block the signal.

FWA cellular is often the most price-competitive broadband alternative now that ACP is gone. Prices of $50 and $60 per month for unlimited broadband are a lot more attractive that the prices of the big cable companies.

There are network issues with using FWA on any mass scale. Carriers aren’t talking about the network management side of FWA in any detail, but from various corporate announcements it seems like FWA is mostly intended to monetize excess bandwidth capacity at towers. That means that in any given neighborhood, there is some natural cap on the number of customers an FWA carrier is willing to serve to not harm normal cellphone traffic. While carriers don’t want to talk about it, there is a lot of evidence that the wireless broadband signal varies in strength and is not nearly as stable as landline broadband. FWA is not a great technical solution for dense MDU properties and is probably best used for single-family homes and small businesses.

Deploying FWA on a significant scale means making new investments. I can’t imagine that cellular carriers are interested in making investments in infrastructure and marketing costs to sell FWA broadband in low-income neighborhoods. Expanding an FWA network means constructing new cell sites, probably small cell sites, and involves getting fiber backbone to new sites.

But I can picture various kinds of partnerships between a City and cellular carriers that might work. One kind of partnership would be on the infrastructure side. I can picture a City or an ISP looking for a low-income broadband solution and willing to invest in small cell sites and fiber to feed them as part of bringing a more affordable broadband solution to selected neighborhoods.

I can also envision various partnerships on the customer/marketing side. For example, cellular carriers today are involved in numerous wholesale arrangements with companies that repackage and resell services on their network. I can envision a city or ISP willing to buy thousands of bulk FWA connections a month – and with a wholesale discount, they could offer lower prices to low-income homes. I have to think there are many variations of these themes and a slew of possible partnership arrangements.

This is all reliant on cellular carriers willing to enter into a discussion of partnerships. Such partnerships would be obviously good for low-income residents and could help to increase broadband adoption in low-income neighborhoods. This would be good for cities that will benefit by having more residents connected to broadband. This could also benefit the cellular carriers by bringing them new customers and revenues, with somebody else tackling the marketing effort on their behalf.

Maybe ACP Isn’t Dead

There are still those in Congress that don’t want the Affordable Care Plan (ACP) to end. Both the House and the Senate made recent moves to advance the resurrection of ACP. As a reminder, the ACP plan provides a $30 subsidy for broadband for low-income households, with some homes eligible for a $75 discount.

In the House, the team of Rep. Nikki Budzinski (R-IL) and Rep. Mike Carey (R-OH) introduced the Secure and Affordable Broadband Extension Act. The bill was quickly co-sponsored by a bipartisan list of representatives including Angie Craig (D-MN), Nicole Malliotakis (R-NY), Joe Courtney (D-CT), Jen Kiggans (R-VA), Susan Wild (D-PA), Jack Bergman (R-MI), Raja Krishnamoorthi (D-IL), James Moylan (R-GU), Annie Kuster (D-NH) and Jenniffer González-Colón (R-PR).

The Act also includes funds for the completion of the rip-and-replace of Chinese wireless electronics from Huawei and ZTE. The bill would be funded by an FCC auction of the AWS-3 band of spectrum. This includes three bands of spectrum from 1695-1710 MHz, 1755-1789 MHz, and 2144-2180 MHz – spectrum that is desirable for cellular broadband. The Act also recommends lowering the size of the ACP by decreasing eligibility from 200% of the poverty level to 135% – the level that has been used for years by the FCC’s Lifeline Fund.

The Senate also has a current ACP replacement bill – the Affordable Connectivity Program Extension Act. The original Act was co-sponsored by a bipartisan group including Sen. Peter Welch (D-VT), JD Vance (R-OH), Jacky Rosen (D-NV), Kevin Cramer (R-ND), Sherrod Brown (D-OH), and Roger Marshall (R-KS). This bill recently made it past the first hurdle and was advanced by the Commerce Committee, including an amendment to provide $7 billion in funding. The Senate bill also also now includes $3 billion to complete the rep-and-replace.

The laws are just at the beginning of the legislative process. They would have to be passed by the House and Senate floor, reconciled to have matching provisions, and get signed by the President.

A long list of ISPs have expressed support for these bills. But I have to wonder how a renewed ACP plan will be received in practice. If ACP starts over, ISPs will have to go through the process of recertifying every customer and can’t just restart for former ACP customers. It’s also likely that some customers were unable to pay their first bill after the end of ACP and would now be considered as bad debt customers and possibly ineligible by many ISPs to participate.

The whole idea of funding ACP one year at a time brings other baggage. It seems like that many ISPs are going to be less than enthusiastic about signing customers when there is a good likelihood in a year that the fund will run dry again and the process will repeat. ISPs are not reimbursed for the big effort of recertifying customers or of processing the monthly payments to the FCC. I have to think that many ISPs will voice support, but won’t not try very hard during a reconstituted ACP.

The ACP plan holds great promise if it is permanently funded. If ISPs can count on the subsidy, there are numerous ways to use ACP as part of the solution for solving the lack of broadband in low-income urban neighborhoods. But after this last fiasco with the funding going dry, there is no bank or other lending source that will count ACP revenues as a reliable source of income for an ISP – and they shouldn’t. Anybody who builds a business plan reliant on ACP will likely struggle or fail whenever the funding abruptly stops.

If passed, these bills give ACP life for another year or so. But the bills fall far short of fixing ACP.

ISPs Response to the End of ACP

The press is suddenly full of articles talking about how some ISPs are offering affordable rates to low-income homes now that the ACP monthly subsidy has died. I discussed some of these plans in a recent blog. Some ISPs are extending the $30 discount for a limited time, while others are offering more affordable broadband plans than in the past. Other ISPs are only making a nod towards affordable broadband and some aren’t giving any discounts to low-income households.

Today’s blog ponders the wide response we’re seeing to the end of the ACP. I’ve talked to some ISPs that didn’t put any effort into ACP because they recognized that the plan was temporary. ACP was funded by Covid funding, and ISPS foresaw correctly that the fund wouldn’t be renewed when it ran dry. I think many of these ISPs would have been more enthusiastic about ACP if it had been established from the start as a permanent program with a guaranteed source of funding. A lot of folks in the industry have been lobbying to make ACP permanent by rolling it into the FCC’s Universal Service Fund. There are other ways that ACP funding could be guaranteed. One idea that has gotten recent traction is to divert proceeds from FCC spectrum auctions to fund ACP.

Some ISPs were put off by the paperwork, the cost, and the downside risks. The paperwork needed to enroll in the plan was hard to navigate and not friendly for smaller ISPs. ACP also requires ISPs to make costly efforts to enroll people, with no compensation other than a reimbursement of the customer discount. ISPs would like ACP more if there was a small additive each month to cover the cost of operating the plan. ACP also came with periodic audits, and ISPs feared doing their best and still failing these audits. To some ISPs, ACP felt like a program with more potential public downsides than upsides.

Some ISPs did the math and saw it was too expensive to enroll and connect ACP customers. Cable companies have a relatively easy path to connect an ACP household. Their coaxial networks have been in communities since the 70s or 80s, and that means a large percentage of homes already have a coaxial drop. If a home had cable service at some point over the last forty or fifty years, there is a good chance that the drop cable is still in place. That means a low cost to add most ACP households.

Fiber ISPs have a more expensive effort and had to install a fiber drop for most new ACP customers. Most fiber providers claim an overall cost of $1,000 or more to add a new home to the network. No ISP wants to make that kind of capital investment without a reasonable expectation that new customers will stay long enough to pay back the initial investment. Many fiber ISPs were leery about making the investment for an ACP home because of the high cost, slow payback, and lack of guarantee that ACP would last.

Some ISPs like Charter embraced ACP, and New Street Research says that Charter enrolled more than 4 million households in the program. This is likely the primary reasons over the last year why Charter was still showing customer growth while other big cable companies were losing customers each quarter. There are also ISPs working in low-income neighborhoods and tribal areas that fully embraced ACP and built a business plan based on the ACP discount. One has to think that Charter will pay a price for having embraced ACP – a lesson that other big ISPs will notice and learn from. Smaller ISPs that built a business plan based on the ACP discount are now in shambles.

A lot of ISPs only paid lip service to ACP. They only enrolled customers who asked for the discount, but didn’t advertise ACP or aggressively seek ACP customers. Some of the ISPs getting praise for having an affordable ACP replacement product didn’t pursue ACP customers and likely won’t push the new low-price plans.

There is still a chance that ACP will be funded sometime this year. The folks in Congress looking at restarting ACP should realize that many ISPs are going to shun ACP if the funding mechanism has to be reauthorized by Congress every few years.  If Congress brings back ACP, then bring it with a permanent funding source – or don’t bother.

ISPs and the End of ACP

As I write this blog, the ACP program that provides a discount for millions of homes will disappear unless Congress takes action to continue it. By now, most big ISPs have announced how they will handle broadband for low-income homes after the end of ACP.

Altice Optimum provides the Optimum Advantage Internet plan that provides 50 Mbps download speed for $14.99 per month. Customers can choose to double the speed by doubling the price.

AT&T. The company says it will still offer its Access from AT&T plan for $30 per month that provides unlimited usage at 100 Mbps. Those speeds are available on fiber, with best effort-speeds on DSL or FWA cellular wireless.

Charter will continue to offer the Spectrum Internet Assist plan, which offer 50 Mbps download speeds for $24.99 per month. Customers can double the speed for an extra $5 per month.

Comcast is going to keep its Internet Essentials plan that provides speeds up to 50 Mbps for $9.95 per month. Plan participants can also buy a low-cost basic computer. Comcast is going to let customers who were enrolled in ACP rollover to Internet Essentials without having to go through the qualification process again. But it looks like customers will have to choose the rollover option and it’s not automatic.

Comcast also just announced a new plan called NOW Internet that will offer 100 Mbps service for $30 or 200 Mbps service for $45. These are not low-income programs and are available to everybody. This seems to be the company’s response to losing customers to FWA wireless plans being offered by T-Mobile and Verizon.

Cox Communications will continue to offer two plans. First is its Connect2Compete plan that provides a $9.95 monthly broadband connection to families with a child in grades K-12 who qualifies for the national School Lunch Program or other federal programs. Cox also has a ConnectAssist plan for $30 per month for other families who qualify for a list of federal programs. Both plans deliver speeds up to 100 Mbps.

Frontier will allow customer who were using ACP to instead get the $9.25 FCC Lifeline discount. It’s not clear if that transition is automatic or if customers will have to apply for the Lifeline discount.

Mediacom offers the Xtreme Connect plan for low-income households for $28.99 per month. This includes a $14 charge for the WiFi modem. Households with students who qualify for the federal School Lunch Program are not charged the modem fee, bringing the price down to $14.99.

T-Mobile has several plans for customers who are already using the ACP discount. Customers of Assure Wireless will continue to get the equivalent of the ACP discount through August 2024, at which point they will covert to get the FCC’s $9.25 Lifeline discount. ACP customers using Metro by T-Mobile will continue to receive the ACP discount through June 2024. For July and August, the discount will drop to $15 per month.

Verizon will continue to offer its Verizon Forward plan that gives customers a 300/200 Mbps connection for $20 per month. Existing ACP customers will get this plan free for at least six months.

Windstream gave ACP customers until April 30 to transfer their ACP benefit to its Kinetic Benefit program. Any customers who made the transition will be able to keep the identical discount received under ACP for as long as they keep the plan at the same address and don’t make any changes to the plan. It’s not clear what happens to customers who did not make the benefit transfer.

This is a wide range of responses to the end of ACP. Some big ISPs are reverting to affordable rates for low-income households such as the $9.95 plan from Comcast. Others are extending the ACP from a few months up to six months. A few are only offering Lifeline as the alternative to ACP. A few are making the transition automatic to low-cost plans while it appears others will require customers to apply for the discounts.

While I won’t list them, smaller ISPs are making similar changes. For example, I know one ISP that will keep the ACP discount the same for customers as long as they keep service. I also know smaller ISPs that will let ACP lapse with no low-income replacement plan.