More American homes will be able to get affordable broadband access next year, thanks to a new initiative from the Federal Communications Commission. Under the program, announced Wednesday, cable companies will offer high-speed Internet service for $9.95 to homes with children who are eligible for free school lunches.
About 35 million homes, or one-third of the U.S. population, do not have high-speed Internet access. FCC Chairman Julius Genachowski said in a statement that "the broadband adoption gap in the U.S. is very large, and the costs of digital exclusion are getting higher and higher."
The average price of high-speed Net access for homes is $45 per month or higher. Twenty-five million Americans are in families whose children are eligible for federally subsidized, free school lunches.
The program is called Connect-to-Compete, and it will be operated by a new non-profit organization by that name, which the FCC will oversee and fund, to the tune of $4 billion. The organization will launch in the spring of next year, and the program will roll out next fall.
All the major cable companies are participating, and the $9.95 offer, plus taxes, is good for up to two years, providing high-speed service of at least 1 Mbps. Higher speeds are at the discretion of the provider. The companies will not charge for installation or the rental of routers. Phone companies, such as AT&T and Verizon, are not participating. Comcast, as part of the deal to win the FCC's approval of its purchase of NBC Universal, has already started a discount service.
The initiative includes an offer from Microsoft to sell Windows 7 PCs with its Office suite for $250 to those families who qualify. Another company, Redemtech, will sell refurbished computers for $150, shipping and 90 days of tech support included. Morgan Stanley said it will offer a micro-finance lending program to community-based financial institutions, to assist those families who cannot afford these prices.
The Next Steve Jobs
In addition, Microsoft, Best Buy, and organizations such as United Way are going to provide training about how to use the computers and the Net.
The new program is part of an ongoing effort by the FCC to broaden high-speed access, as the U.S. is falling behind in broadband availability, compared with other advanced countries. Currently, the U.S. ranks 18th in the world in percentage of households with broadband, although the federal government said that 78 percent of families with children are connected to broadband.
"Steve Jobs was born into a lower-middle-class family," Genachowski told news media, "but part of his story is he had access to then cutting-edge technology because his father was a mechanic in Silicon Valley.
"If we give children better digital technology, we're much more likely to see the next generation of innovators like Steve Jobs develop."