Telecom fights price caps as U.S. spends billions on internet access

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Telecom companies such as AT&T, Charter, Comcast, and Verizon are lobbying against strict new rules that would require them to lower their poorest customers' monthly bills in exchange for a share of the $42.5 billion federal program to improve internet access across the U.S. The lobbying campaign has caused regulators in several states, including California, New York, South Carolina, Tennessee, Virginia, and others, to rethink, scale back, or abandon their plans to condition the federal funds on financial relief for consumers. The telecom companies argue that the proposed price cuts are illegal and that rate regulation would hinder the success of the broadband program. On the other hand, consumer advocates argue that the industry is trying to benefit from the federal aid without addressing the issue of high broadband prices. The political wrangling has significant consequences for the approximately 8.5 million U.S. households and small businesses that still lack access to affordable internet, exacerbating the digital divide. The $42.5 billion federal program, enacted as part of the 2021 infrastructure law, aims to deliver speedy and affordable broadband to unserved areas of the country by 2030. The Biden administration has suggested that internet plans should cost consumers no more than $30 per month, but local officials have the flexibility to propose alternatives. Telecom companies have spent millions of dollars lobbying against restrictions on pricing and have questioned the legality of tying federal funds to specific pricing changes. The telecom industry's lobbying efforts have been influential in several states, leading to the removal or scaling back of proposed price caps for low-income residents. The opposition from the telecom industry highlights its vast power and reach as a political force. The policy disputes have gained urgency as the Affordable Connectivity Program, which provides monthly subsidies to lower broadband bills for millions of Americans, faces the prospect of sharp cuts in May and is set to cease operating in June due to a lack of funds. Congressional Republicans have criticized the subsidies as wasteful and have sided with internet providers over the provision of federal infrastructure funds. The lobbying efforts by the telecom industry and the political pressure have raised concerns that the massive influx of federal aid for broadband may fall short of its potential if Americans cannot afford the new broadband service in their communities.

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https://www.washingtonpost.com/business/2024/04/15/telecom-lobbying-price-caps-broadband/