News

Cable’s 'A-Plus’ Idea

12/05/2009 2:00 AM Eastern

Cable operators representing 86% of cable subs nationwide last week proposed to offer half-price basic broadband service to some 1.8 million low-income households with middle-school-aged children, as long as the government will agree to fund a media-literacy program and other broadband-adoption efforts.

The National Cable & Telecommunications Association offered the plan in comments filed last week to the Federal Communications Commission, the National Telecommunications & Information Administration and the Rural Utilities Service.

NCTA members would provide the lower-cost service for two years at a savings to its new customers of more than $500 million, NCTA president Kyle McSlarrow said.

McSlarrow conceded at a press conference announcing the proposal that there was an obvious upside in signing up those 1.8 million new households: NCTA has agreed to the half-price offering for a maximum of two years.

“I’m not going to deny that we could benefit by driving broadband adoption,” he said. But he also pointed out that the industry had a history of helping out in the community.

The cable industry is not asking for any government subsidy for its broadband service price break, part of an initiative it has dubbed “A Plus,” or Adoption Plus.

The government will have to ante up for the program to work, though, NCTA made clear.

As part of the public-private partnership, school districts would have to provide federal funded digital media literacy training. “The A-Plus proposal contemplates that school districts would be eligible for an estimated $100 million of federal funding required over the two years of the program to defray the cost of providing digital media literacy training and other administrative tasks,” NCTA said.

Cable operators also want NTIA and RUS to concentrate the second round of stimulus grants and loans primarily on adoption and literacy, saying NTIA should set aside at least $500 million for a media literacy campaign that includes online safety training.

McSlarrow said the program could be pulled together by the fall of 2010 if NTIA and RUS stimulus money went toward the proposal.

The FCC appeared to be squarely on board. FCC chief broadband advisor Blair Levin was on hand last week to applaud the proposal — not surprising as NCTA said that proposal came after discussions with Levin and FCC chairman Julius Genachowski.

“The cable industry’s considerable investment in this program represents an important step in addressing the many broadband adoption challenges we face,” Genachwoski said of the A-Plus effort. “Recognizing that there is no silver bullet for promoting sustainable adoption, the A-Plus program offers students the combined support of digital literacy education, discounted computers, and discounted broadband access.”

Eligible households will need to meet three criteria: participants must be middle school students, must be eligible for free or reduced-price lunches, and must not currently receive Internet service.

The program also must include a discount on computers, funded by computer manufacturers or federal funds if necessary.

The NCTA has been focused on broadband adoption and what cable, as the largest broadband provider, could do to boost the uptake, said McSlarrow, who said the new proposal has its roots in a local Cox Communications effort.

McSlarrow said that there is no single way to reach the one-third of the population not receiving broadband service.

The first component of the plan would be federal funding for digital literacy; the second component would be discounting computers; and the third piece would be providing discounted broadband.

No equipment suppliers were part of the announcement, though McSlarrow said NCTA had had discussions with some of them about their role. No telco Internet service providers had signed on, either, but McSlarrow said the announcement was the beginning of a conversation with other ISPs in an effort to move the needle” in a targeted way.

AT&T has already been in contact with the cable trade group, according to executive vice president James Cicconi. “We have already been in touch with the NCTA about the A-Plus proposal, and look forward to working with them and the FCC as details are developed,” he said in a statement.

NCTA got warm fuzzies from many quarters, including from Genachowski and Levin and from groups representing minorities.

“Adoption Plus gets to the heart of the challenges facing so many low-income families — affordability, computer ownership, and skill building — without adding financial burdens to local governments and school districts already facing drastic budget cuts,” Dr. E. Faye Williams, chair of the National Congress of Black Women, said in a statement. “We support the proposal as a model for broadband stimulus programs.”

Jose Marquez, president of the Latinos in Information Sciences and Technology Association, said the program would a critical component of ensuring equal access to the benefits of broadband. 

ADOPTION PLUS PARTICULARS

Some key facets of the National Cable & Telecommunications Association’s plan to offer discounted high-speed Internet service:

Source: NCTA
Signing on to date: Comcast, Time Warner Cable, Cox, Charter, Cablevision, Bright House, Mediacom, Suddenlink, Insight Communications, Bresnan Communications, Midcontinent Communications, GCI, US Cable, Bend Broadband, Eagle Communications and Sjoberg’s Cable.
On offer: Half-price broadband service, a half-price cable modem to 1.8 million households for two years; public-service ads would publicize the effort. Estimated value: $527 million.
Eligible households: Would include at least one student in grades 6-9 and would follow the same requirements as for subsidized school lunches.
Service: Lowest tier already offered, with a minimum downstream of 1 Mbps, free installation and parental control software.
School districts would provide: Digital media literacy training, including seeking federal funds. Computer companies would be expected to provide discounted computers, with help from government funds or non-profits.
NCTA suggests the government subsidy mirror the digital-TV converter coupon program and recommends using at least $500 million in broadband stimulus money for digital-media literacy training.

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