Big Telecom Will Soon Get $42 BIllion In Taxpayer Subsidies, But Balk At Providing Affordable Broadband To Poor People

Broadband providers poised to receive $42 billion in taxpayer broadband subsidies from the infrastructure bill are ramping up complaints about a small requirement affixed to the massive handout: they have to try to make broadband affordable to poor people.

Earlier this month we noted that the GOP, in lockstep with the telecom industry, had launched an “investigation” into the low-income requirements attached to the Broadband Equity Access And Deployment (BEAD) subsidy program and the agency overseeing it (NTIA).

The requirements are not onerous: the NTIA delegates most authority for how the money is to be spent to the states, which are “strongly encouraged” (according to BEAD program guidelines) to provide a slower, cheaper service tier somewhere between around $30 and $48 per month. And only to families that qualify for existing low-income assistance programs.

But in a new letter to Commerce Secretary Gina Raimondo (hat tip, Ars Technica), telecom lobbying organizations (most of them directed by AT&T) vaguely threaten that they’ll take their ball and go home if the requirements for a low-cost option aren’t eliminated:

“Without significant and immediate changes of approach toward its implementation, we are concerned the program will fail to advance our collective goal of connectivity for all in America. We and our members sincerely want this program to work, but we believe that your agency’s administration of the low-cost service option requirement in particular risks putting the overall success of BEAD in jeopardy.”

To be clear I’m not sure that federal or state lawmakers are even able to enforce this requirement with any consistency, given the rank corruption and feckless careerism that abounds in telecom regulatory oversight. But just the faintest hint that they might have to make their product affordable greatly upsets regional monopolies, who’ve spent decades working to undermine competition and oversight in a bid to keep U.S. broadband prices artificially inflated.

Telecom giants like AT&T have grown fat and comfortable ripping off captive local subscribers and effectively telling regulators what to do. They’re so comfortable, in fact, that the barest bone efforts asking them nicely to provide a less expensive option to poor people is being treated like some kind of draconian, radical and illegal effort at unchecked “rate regulation.”

This wouldn’t be quite such a contentious issue if most of these companies didn’t have a 40 year track record of gobbling up taxpayer dollars for broadband deployments they never quite seem to finish. Or if they hadn’t made U.S. broadband so patchy and expensive due to relentless efforts at anti-competitive regional monopolization.

BEAD money is poised to start flowing to the states this fall, but big telecoms, if they wanted, could throw a wrench in the process over these modest requirements (AT&T’s already apparently doing this in Virginia). At which point, telecom giants (and the politicians bribed into a near-mindless fealty to them) will absolutely blame government for the entirely avoidable delay.