BY JONATHAN SCHWANTESJune 15, 2021 at 5:00 am ET
It has been more than a year since the world was confronted with a devastating virus that dramatically altered the way we live, work and communicate.
Today it is clearer than ever how much we depend on a fast, reliable internet connection. But getting online for millions of Americans is too costly and in many cases the service is inadequate.
Being able to get online impacts everything: Your job. Your school. Your health care. Whether you’re trying to sign up for the vaccine or trying to get essentials shipped to your home, your connection makes all the difference in the world.
Seventy-six percent of Americans believe that internet service is as important as water and electricity. Yet almost half of low-income households do not have broadband internet at home. A recent report found almost 16 million students and 10 percent of teachers lack adequate internet or computing devices at home. People of color are among the most affected: Though 18 percent of white homes lack broadband, the figure rises to 26 percent for Hispanic homes and 30 percent for Black homes. The percentage is even higher among tribal households.
Companies like Comcast have heavily promoted programs for low-income individuals, which Comcast was required to do as a condition of merging with NBCUniversal. But these initiatives have not connected communities as promised. Only after a student protest in Baltimore did Comcast decide to raise speeds for its program. The good news is that where competition does exist in this market, consumers benefit from lower prices and better service.
Robust competition creates scrutiny and accountability that can prevent companies like Comcast from expanding data cap limits when people are more dependent than ever on an internet connection. Even during the pandemic, Comcast and other internet service providers still enforce these data caps in markets where they face little or no competition. Rather than being a good corporate citizen during a time of suffering, Comcast chose the path that benefited its bottom line, only backing down from its position after weeks of public pushback.
To create a better marketplace, we need more transparency when it comes to internet prices and fees. According to a 2019 Consumer Reports study, about 70 percent of U.S. adults who have used a cable, interne, or phone service provider in the past two years said they experienced unexpected or hidden fees.
Most company-imposed fees, like the ubiquitous “Broadcast TV Fee,” apply to video service, but CR discovered new fees being attached to internet service as well. Adding to consumers’ misery is a complete lack of uniformity of pricing or plan information on internet service bills. For example, a bundled service bill may not even include a line-item price for internet service. Many bills do not even mention the download and upload speeds that the consumer is paying to receive.
Imagine if the auto industry did not put the mileage or the price on the window sticker of a new car. That’s the reality in the murky internet service market.
Now policymakers in the White House and Congress are taking action to try to close the digital divide. President Joe Biden has pledged to “go big,” unveiling a plan to spend $100 billion to boost broadband access and affordability. On Capitol Hill, Rep. Jim Clyburn (D-S.C.) and Sen. Amy Klobuchar (D-Minn.) introduced the Accessible, Affordable Internet for All Act, which tracks many of the policy goals of the White House.
One provision that could make a major impact: requiring companies receiving federal funds to build new broadband networks that include an affordable option, so consumers with fewer means can acquire service. The legislation also directs the Federal Communications Commission to begin the annual collection of pricing data to get a handle on what exactly consumers are paying for broadband, and to reintroduce the consumer broadband label to enhance price and performance transparency.
Importantly, both the Biden proposal and the AAIA Act would nullify ISP-backed laws in 18 states that restrict community broadband networks, which have proven to be a viable competitive option for consumers. Of course, the response from the trade association that represents the country’s largest ISPs was an apoplectic “no.” Michael Powell, former FCC chairman and now head of NCTA – the Internet and Television Association, lashed out at Biden’s proposal, calling it “surprisingly Soviet.”
We have heard this song before. It’s the familiar refrain of someone who is content to charge high prices and engage in anti-consumer behaviors like data caps and charging consumers for equipment they don’t use.
The internet should no longer be treated as a luxury. It is an essential service for millions of us every day. The White House proposal and the AAIA Act would help connect millions of Americans to high-speed internet. Given the absence of leadership from corporate actors, we need policymakers to step up and lead the way in connecting the unconnected. This is a great first step and a plan all Americans should rally behind.
Jonathan Schwantes is senior policy counsel at Consumer Reports, where he focuses on telecommunications and competition issues affecting consumers in the broadband, television, media, and wireless markets.
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