F.J. Pollak is president, CEO, and co-founder of TracFone Wireless. He writes about the need to preserve subsidized phone service for low-income Americans.
Federal regulators recently announced a move that could deprive millions of low-income Americans of one of modern life’s necessities — the telephone.
Officials at the Federal Communications Commission are considering a series of reforms to the “Lifeline/Link Up” program, which provides discounted phone service to the needy. If they’re not careful, they could cut the phone cord for folks who need it most.
The federal government has maintained two programs that subsidize phone service for low-income Americans since 1985. Lifeline discounts a consumer’s phone bill by up to $10 each month, and Link Up offers consumers up to $30 off connection charges. Both programs are administered through the Universal Service Fund, which helps make phone service available to all Americans, including government entities like schools and libraries as well as those who live in rural areas.
Originally, Lifeline was intended to help consumers pay for conventional landline phones. But as mobile phones have become commonplace, the FCC has allowed low-income folks to use Lifeline funds for wireless service, too.
Carriers who partner with Lifeline can offer eligible participants prepaid cell phones with 250 minutes of use per month. The service continues unless the recipient doesn’t use it for several months, and additional minutes are available for purchase if necessary.
Earlier this year, the FCC expressed concerns over the growth of Lifeline. The agency floated the idea of capping the fund and earmarking any savings for pilot initiatives to expand broadband access.
Such a move makes little sense. Capping the fund could cut off the phone service of scores of Americans when they need it most. After all, the recession has increased the population of folks who might turn to Lifeline for help. Between 2007 and 2009, almost five million more people dropped below the poverty line.
The agency has also explored the idea of charging customers for Lifeline service. Such a move would further burden low-income families laid low by the recession.
Lifeline was designed to help low-income families stay connected. Erecting additional enrollment barriers defeats the purpose of the program.