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AT&T uses loophole to deny low-income internet discounts

Engadget Engadget 7/09/2016 Steve Dent
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AT&T is using a technicality to refuse its FCC-mandated "Access From AT&T" discount program to families who should qualify for it, according to the National Digital Inclusion Alliance (NDIA). In an absurd twist, the loophole is that its broadband speeds in the affected areas are too slow.

As a condition for AT&T's merger with DirecTV, the Federal Communications Commission (FCC) requires that it offer $5 or $10 internet service to people on the SNAP low-income assistance program. If internet speeds were between 3-5 Mbps, folks would pay $5 per month, or $10 per month for speeds between 5-10 Mbps. So, if speeds are lower than 3 Mbps, do folks then pay $5 per month or less?

Not according to AT&T. When the NDIA asked the company to apply the program to neighborhoods with speeds of 1.5 Mbps, it refused. "AT&T is not prepared to expand the low income offer to additional speed tiers beyond those established as a condition of the merger approval," the company replied in a statement. As a result, poor families that should qualify for the $5 program must pay $30 per month (and more after 12 months) for a service well below the definition of "broadband."

The FCC's order states that "where AT&T has deployed broadband service at top speeds below 5 Mbps, the company shall offer wireline broadband internet ... at speeds of at least 3 Mbps, where technically available, to qualifying households in the company's wireline footprint for no more than $5 per month." In effect, AT&T is saying that the "where technically available" clause exempts it from providing the low-income program in areas where, ironically, it has failed to upgrade its service.

AT&T told the Daily Dot that "the vast majority of the locations where we offer internet service are able to subscribe to internet speed tiers at 3Mbps or higher." It added that the 3 Mbps cutoff was "determined by the FCC." However, the NDIA points out that 21 percent of subscribers in Detroit and Cleveland (above), mostly in low-income, inner-city neighborhoods, have 1.5 Mbps or lower speeds.

AT&T's response is very unfortunate for tens of thousands of households in the company's 21-state service territory who may need affordable internet access the most, but who happen to live in places ... where AT&T has failed to upgrade its residential service to provide reasonable speeds.

The FCC declared last year that the internet is an essential utility for consumers, not an optional luxury, a decision backed by a US district court. The ruling gives it much broader latitude to regulate internet prices and other aspects of service. Utilities like AT&T, Comcast and Verizon disagree, however, saying the order hurts competition and infrastructure development, and that they'll battle it all the way to the Supreme Court. (Engadget has reached out to the FCC and AT&T for comment.)

While AT&T may be within its rights to do no more than the FCC requires, the NDIA was disappointed by the decision. "AT&T's response is very unfortunate for tens of thousands of households in the company's 21-state service territory who may need affordable internet access the most, but who happen to live in places –- both city neighborhoods and rural communities –- where AT&T has failed to upgrade its residential service to provide reasonable speeds," it said in a blog post.

NDIA

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