Comcast Internet Essentials: Is It Bridging the Digital Divide?

by Aeyne Schriber on September 30, 2014 in Comcast

A few years ago, Comcast rolled out an affordable high speed broadband service that promised to bring the Internet to low income families. But some challenge Comcast’s motives for rolling out the Internet Essentials project.

According to a study conducted by the Pew Research Center, a nonpartisan social science research organization that publicizes current issues and trends, nearly one quarter of low income households with an income of less than $30,000 per year are not connected to the Internet. In an effort to reach underserved households, a few years ago, Comcast launched the Internet Essentials project which Comcast claims has helped more than 350,000 families in various cities in the United States which is about 1.5 million low-income people. The project offers high speed broadband access at a cost that is much lower than the traditional monthly Internet access plans.

The Internet Essentials project is geared toward improving educational outcomes for students in low income families and providing opportunities for students that would otherwise be unavailable. It also assists low income adults with getting connected to enable them to find employment, help their children complete their homework, access healthcare and government services, and more.

The Internet Essentials program is available to low income families that have children in grades pre-K to high school. The children must qualify for the free or reduced meal program at their local school district. Or, the family must be poverty level defined by the federal government which is 170 percent or less. Additionally, Comcast has extended the Internet Essentials program to school districts that have a high percentage of students from low income families.

To kick off the fourth year of the Internet Essentials project, Comcast recently hosted a Youth Tech Summit to promote the Internet Essentials initiative and to explain in an education technology focused environment how the program works. Also discussed were other initiatives by Comcast to boost learning through technology in schools.

How the Internet Essentials Initiative Works

In order to take advantage of the Internet Essentials program, there are specific qualifications you must meet to receive Internet access for $9.95 per month. Along with the $9.95 per month service, low income families can also receive a voucher for a PC at a reduced cost. In order to qualify:

  • You must have a minimum of one child in the household that qualifies for participation in free or reduced lunches set forth by the National School Lunch Program.
  • You must reside in a location where you have access to Comcast’s services.
  • You cannot be a Comcast customer with access to their Internet services within the last 90 days.
  • You cannot have an outstanding balance on a Comcast service that is less than one year old.

How to Apply

Comcast provides you with several methods for applying to the Internet Essentials program. You can opt to complete an application on the company website and submit it online or you can call the toll free number to request an application to be mailed to your home address.

Regardless of the method you choose, Comcast requires specific documents that you must submit to determine eligibility for the Internet Essentials program. The documents may include verification of household income, proof of National School Lunch Program enrollment, and other relevant documentation.

Once the application process is complete, approval usually takes anywhere from one week to ten days. Upon approval, Comcast then sends you a welcome package with everything that is necessary to get started with the Internet Essentials program along with instructions and support for getting set up. You also receive an invitation to participate in a free Internet training.

If you opt to purchase a PC from Comcast at a reduced cost, you also receive instructions and support for getting the PC set up and connected to the Internet. The cost of the computer is $149.99 plus, you are given the option to choose which type of PC you would like.

Comcast offers the choice of a laptop PC for enhanced mobility or a desktop PC that can be placed in a centralized location in your household for all family members to use. Regardless of the type of device you choose, you have access to Microsoft Office which is preinstalled on the device. Comcast also provides you with a limited hardware warranty for 90 days. The warranty covers hardware such as a router and modem which is essential for providing you with a connection to the Internet.

Here is a video that provides more information on the Internet Essentials program.

The Internet Essentials Controversy

As you can see by our explanation of how the Internet Essentials program works, it appears to be a useful initiative on the part of Comcast. However, the launch of the Internet Essentials initiative sparked a lot of controversy starting with the conflict over significantly slower speeds than Comcast advertised.

Initially, Comcast advertised download speeds of 3 Mbps (megabits per second) with an upload speed of 786 Kbps (kilobits per second) when the Internet Essentials program was first introduced. The data speeds were slower than nearly 90 percent of the Internet services in the United States. Additionally, the Federal Communications Commission (FCC) had defined high speed broadband as having download speeds of 4 Mbps with upload speeds of 1 Mbps.

Since that time, Comcast has increased the performance for the Internet Essentials broadband program to a download speed of 5 Mbps with an upload speed of 1 Mbps. This is a significant improvement in performance when compared to the initial launch of the Internet Essentials program.

And, although the service is only available to low income households, many question Comcast’s sincerity in helping to bridge the digital divide since the Internet Essentials initiative was launched as one of the required conditions to help the company acquire approval during its acquisition of NBC Universal. As part of the acquisition, Comcast bought out nearly 50 percent of the NBC Universal media company that it did not yet own.

Strict Requirements

The Internet Essentials initiative is not categorized as a government program as many were led to understand. Instead, it is a program run solely by Comcast to bring affordable high speed broadband to low income households.

Comcast originally announced that more than 2.5 million households would qualify for the Internet Essentials program. However, qualification for the program comes with strict requirements like the ones described earlier, including having a child enrolled in a free or reduced lunch program at their local school district, having to reside in an area where Comcast service is provided, and not having a past due balance on a Comcast bill for under one year, and no Internet access service with Comcast for a minimum of 90 days prior to applying for the Internet Essentials program.

One of the issues with the requirements for qualifications is customers who subscribed to the cheapest plan for Comcast Internet access. This means that they would be required to completely cancel their existing subscription and then endure a waiting period of 90 days before they could apply for the Internet Essentials plan. Although the cost savings would be beneficial, this is considered to be a long time to go without home Internet access, especially when most students need it to complete their homework.

This proved to be controversial since this type of approach to the Internet Essentials program did not provide any type of relief to low income households that subscribed to the lowest tier Comcast Internet package. Additionally, many feel that the strict requirements are not enforced to assist Comcast with reducing costs since the Internet Essentials program does not incur any additional costs on the part of Comcast to enroll new subscribers.

Additional Profit

Another angle that surrounds the controversy is the Internet Essentials program generates a profit for Comcast which makes people speculate as to whether or not the program is a disguise for a new customer acquisition initiative. Because of the requirements, the program is geared toward non Comcast customers which allows the company to acquire new customers without having to invest in additional infrastructure.

The Internet Essentials program is currently generating just under $20 million per year in revenue. Although the company may not be generating a huge profit, according to the terms of the Internet Essentials plan, Comcast may be seeking to earn more revenue from Internet Essentials customers if they become ineligible at any point.

According to the terms of the plan, Comcast reserves the right to charge Internet Essentials customers the price of a regular plan if they do not submit the correct supporting paperwork, fall behind on the balance of the bill, or they move to another location. The monthly rate can jump to as high as $39.95 for Internet Essentials customers.

Overdoing Community Interactions

The excessive outreach by Comcast has also come under fire by critics of the Internet Essentials service. Comcast launched the initiative to satisfy a regulatory requirement to acquire NBC Universal. Therefore, the Internet Essentials program has not been considered a charity or sincere outreach by the company to help low income households to access the Internet. Additionally, coming up with a way to help low income families access high speed broadband Internet represents one of the few remaining markets for companies that offer Internet access services.

As a result, Comcast has gone to great lengths to extend its community interactions in an effort to promote the Internet Essentials program. Throughout local communities, Comcast has been distributing brochures during various events at local school districts and recruiting community volunteers to spread the word about the Internet Essentials program. And many feel the outreach is not sincere for some of the reasons we discussed earlier.

From another perspective, the federal government has been promoting private and public partnerships in an effort to make high speed broadband Internet available to the more than one hundred million people in the United States who lack access. When it comes to Internet access in the United States, the digital divide typically means the difference between living in a rural and urban area.

The percentage of households that lack access to high speed broadband are those that are located in rural areas that lack the infrastructure necessary to bring high speed broadband to remote areas. In this regard, it is more of a broadband divide instead of a digital divide.

The rest of the percentage belongs to low income households that cannot afford the monthly bill for Internet access or others that feel that Internet access is not really necessary. These facts are demonstrated in various studies and government statistics on Internet access.

Regulatory Requirements for NBC Universal Acquisition

In order for the NBC Universal acquisition to be approved, the Federal Communications Commission (FCC) required Comcast to organize an initiative to bring high speed broadband access to low income households. Although Comcast was reluctant to do this, they proceeded to launch an office in Chicago to begin organizing the Internet Essentials program.

Since broadband subscriptions represent a large portion of Comcast’s revenue (more than 55 billion), the company has experienced market depletion with so many subscribers that can afford the conventional high speed broadband service plans. Low income households represent an untapped market.

Although Comcast maintains that the Internet Essentials project is a community investment, the initial launch in Chicago allowed the company to complete its acquisition of NBC Universal which resulted in a massive $13.75 billion dollar deal.

The Political Angle

The official in charge of the Internet Essentials project implementation was a former political consultant to the governor of Pennsylvania. Plus, he worked closely with the mayor of Chicago to make the city of Chicago a showcase market for the Internet Essentials initiative. Comcast also made significant donations to the mayor’s campaigns which amounted to more than 12 million dollars.

The political connection raised many concerns among critics, in addition to the fact that Comcast organized a separate sales force to work directly with the community leaders. These are the volunteers we mentioned earlier that are unpaid and invest their own time to spread the word about the Internet Essentials program. This plan was organized in place of promoting the Internet Essentials plan in the company’s usual marketing plan.

The volunteers run kiosks at parent meetings, open house events, and other local school district events. The volunteers are also recruited to distribute brochures, including sending them home with students of the local school districts.

Advocacy for Broadband Access

On the other side of the coin is the advocates that argue the importance of high speed broadband access to student’s success in school and when they eventually enter the workforce. Many advocate groups feel that broadband Internet should be viewed as a public utility funded in part by government aid.

However, most feel that high speed broadband access services are a monopoly controlled by only a few companies. The Internet Essentials initiative provided Comcast with access to a customer base in local communities where it could attract new subscribers with the promise of low prices.

Recently, the Federal Communications Commission (FCC), organized a program known as Connect2Compete which is a not for profit organization that collects promises by Internet access service companies and software enterprises or provide PCs and high speed Internet access to low income families and the underserved. The organization acts as a middle man between Internet and software companies and the local communities.

Many of the major companies such as Time Warner, Cox, and others have pledged to offer affordable high speed Internet access to low income households through the Connect2Compete program. These companies are competitors to Comcast and the pledge is an effort to create a buffer between communities and the Internet and software companies. The buffer helps to avoid controversies like the one that surrounds the Internet Essentials initiative.

To many, the Internet Essentials program does more to attract new customers to Comcast, in addition to improving public relations than to sincerely help low income households access high speed Internet at an affordable price. The program design appears to be a disguise that serves the bottom line for Comcast, which is tapping into a new market to acquire new customers.

Conclusion

Now that you have been able to see both sides of the Internet Essentials program, it will help you to make an informed decision if you are thinking about applying for the program. The Internet Essentials plan may have proved to be a significant asset for some low income families and if it works for your situation, you may be able to ignore the controversy. At the same token, it helps to have all of the facts before making your own decision as to whether or not this type of program is for you.

Did you enjoy this article?
Subscribe for Updates
Sign up for our newsletter to receive the latest postings.

{ 0 comments… add one now }

Leave a Comment

Time limit is exhausted. Please reload CAPTCHA.

Previous post:

Next post: