We won’t say that the debate is boiling, but the water is starting to bubble. There’s no doubt that both sides of the “Are Internet Essentials and Internet Basics government programs” question are firmly entrenched and unwilling to give an inch. We’re talking the kind of dug-in trench warfare not seen since World War I.
On one side we have those who say, “Don’t be silly. These programs were developed by private enterprise — major cable TV and telephone companies — and no one received receive a penny in government subsidies to do it.”
On the other side we have those who say, “Whoa! Not so fast! Both programs were designed and implemented strictly to assuage government bureaucrats. They wanted something from the companies and they got it.”
Perhaps a little background is in order:
Comcast, the nation’s largest cable TV company, created Internet Essentials, a program that offers discounted internet access to low-income American families for just $9.95 per month plus taxes.
CenturyLink, one of the nation’s largest telephone companies, launched Internet Basics, a similar program that also offers high-speed internet service to low-income Americans for just $9.95 per month.
Why did Comcast and CenturyLink get into the cheap internet business?
TheAtlantic.com sums up the position of those who say it’s a government program because the government coerced Comcast into beginning the program:
“It’s easy to chalk this program up to goodwill on the part of Comcast executives, but it’s unclear if they would have done this were they not required to. ‘Comcast acquired NBC Universal earlier this year,’ National Public Radio’s Bill Chappell reminds us. ‘In approving the merger, regulators … required the company to help low-income households get online.’ Chappell also points out that cutting profit margins won’t exactly cripple Comcast, which reported earnings of more than $14 billion this past week, a 51 percent jump.”
In a similar vein, CenturyLink got into the cheap internet business when it agreed to offer the Internet Basic plan so that the Federal Communications Commission (FCC) ￼￼￼￼￼￼￼￼￼￼￼would approve its 2011 purchase of Qwest Communications, another telephone company.
After seeing why both companies got into the cheap internet business one can see why some argue that both companies business is, in reality, a government business.
How do low income Americans qualify for the programs?
Let’s look a little deeper into how someone qualifies for either program. Perhaps that will provide greater insight as to whether Internet Basics and Internet Essentials should be viewed as government programs disguised as free enterprise. With that in mind, let’s take a look at how a potential customer qualifies for both programs.
Internet Essentials – To qualify, one of those needy families must live in an area where Comcast offers its services. The family must have at least one child eligible for the National School Lunch Program. They cannot have an overdue bill or any unreturned Comcast equipment from a previous account. And finally, they cannot have been Comcast subscribers within the previous 90 days.
Internet Basics – Since CenturyLink is primarily a telephone company, its Internet Basics program follows rules set up for another quasi-governmental program called Lifeline Assistance (the program that has recently gained notoriety as “The Obama Phone”) which offers discounted landline phone service and free government cell phones to low income Americans. The qualification guidelines for the two programs are identical.
You probably qualify for the Internet Basics program if you participate in another governmental assistance program — such as food stamps (SNAP), public housing assistance, Medicaid, Section 8 housing, Supplemental Security Income, various Home Energy Assistance Programs, National School Lunch and other programs. You can also qualify if your household income is at or below 135% to 150% of the Federal Poverty Guidelines.
Both programs seem to base customer qualifications on government poverty programs. Once again, we can certainly understand the point of view of those who say Internet Basics and Internet Essentials are government programs.
But let’s not draw any rash conclusions, because there may be other mitigating circumstances at work.
What are the companies’ real motivations?
There have been many consumer complaints that neither company has rolled out their cheap internet program quickly enough. We’ve also heard complaints that both companies do everything but hide the programs from consumers.
As we pointed out in an earlier article, Comcast promotes Internet Essentials, but critics say they only do so because they were ordered to by the Federal Communications Commission. In fact, the FCC harshly criticized Comcast recently, saying that the company’s promotional efforts were insufficient and accused them of ignoring the program in direct mail efforts, burying information about the service on its website, and not offering the service at its retail stores.
Critics of Internet Basics have thrown similar accusations at CenturyLink.
Again, those who say both programs are merely government programs masked as private enterprise seem to have a point. If these were programs initiated on their own, it would seem as if the two companies would make greater efforts to promote them. If they are, in fact, barely disguised government programs forced on the two companies by the FCC, the lack of promotional enthusiasm makes complete sense.
Which side of the argument do you take?
To review: It’s easy to believe that Comcast and CenturyLink only agreed to create their cheap internet programs because the FCC demanded it. The qualifications for both programs parallel other government aid programs. And neither company really seems to want to publicize these money-losing progams.
So if you think we come down on the side of those who say Internet Essentials and Internet Basics are government programs, you’d be correct. The evidence seems overwhelming.
Now that we’ve established our position, let us make one more editorial comment:
We’re 100% in favor of those government programs even if they are barely disguised as good deeds by private enterprise.
There truly is a frightening digital divide between the rich and poor in the United States. And it will continue growing as long as the needy cannot get access to high speed internet.
We believe the country will be strengthened by programs that bring the Information Age into the homes of all Americans — rich and poor, black and white, young and old.
That’s why we urge the Federal Communications Commission to continue its crusade to “entice” more companies into offering cheap internet to everyone.