Cable Companies to Offer Low-Income Families Subsidized Broadband

Sara Jerome
National Journal

Major cable companies announced on Wednesday that they will offer low-income families broadband subscriptions for $10 per month as part of a partnership with the Federal Communications Commission.

Some of  the nation’s biggest cable companies -- Comcast and Time Warner, among the other members of the National Cable and Telecommunications Association -- made the offer after negotiations with the FCC. The agency has launched an effort this year to encourage companies to commit money to broadband adoption.

President Obama commended the new program, which will last for two years.

“Securing America's competitiveness in a global economy means making sure that every American has access to high-speed broadband Internet and is able to take advantage of it. This important partnership between my administration and American businesses represents a major step toward closing the digital divide -- connecting more families to the 21st-century economy, creating new jobs and unleashing new opportunities, and helping America win the future,” Obama said in a statement. 

The subscription will be available to families who have at least one child in grade school participating in the National School Lunch Program, an aid program based on income.

The idea behind policies spurring broadband adoption is that people who are not able to go online are at an economic disadvantage. For instance, they can’t look for jobs or use the Internet for educational purposes.

“It used to be that being disconnected was an inconvenience. Not any more. Whether you’re talking about jobs, education, or health care, in this day and age, getting online is a necessity, not a convenience,” FCC Chairman Julius Genachowski said in a statement. “We can't afford to have a third of the country frozen out of the broadband economy.”

For the companies providing broadband service, the program is more than just charity.

Josh Gottheimer, senior counselor to Genachowski, said in an interview that the companies partially see it as a way to get new customers, who may keep paying for the service after the low rate expires.

“Hopefully, people spend two years on broadband and realize that broadband is critical,” he said. “It’s a win-win for them. They see it as a long-term investment.”

Comcast is already obligated to offer a cheap broadband service as a regulatory condition of its purchase of NBC Universal last year.