Frontier to offer broadband lifeline service in California, if allowed to buy Verizon systems

3 November 2015 by Steve Blum
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Lifeline’s reach, if the deal goes through.

Frontier Communications will implement an interim low income broadband lifeline program in California, if it gets regulatory approval to buy Verizon’s wireline systems. In an agreement reached with the California Emerging Technology Fund (CETF), Frontier is promising to offer a special package to its voice lifeline customers that comprises…

  • 13.99/month for the low-income broadband service (which is a new affordable product for the Verizon service area and an improved product in the Frontier legacy service areas), available only to Lifeline voice customers, existing or new customers.
  • Frontier shall not require any more information from applicant than is required for the California LifeLine program.
  • Up to 7 megabytes per second (Mbps) downstream where 7 Mbps is available and the highest available upstream speed. If less than 7 Mbps service is available, Frontier will provide the highest available downstream and upstream speeds of service.
  • Free Installation.
  • Free Modem with wireless router.

It’s anticipated that the special deal for California would be phased out if and when the Federal Communications Commission establishes a national broadband lifeline program. That’s what makes it an interim program. Frontier and CETF are setting an “aspirational target” of signing up 200,000 low income households.

In the agreement, Frontier also commits to extend 10 Mbps down/1 Mbps up broadband service to 100,000 homes in “selected areas across the Verizon footprint” and 7,000 homes in its “legacy California service areas”, and upgrade service for 250,000 homes in Verizon’s current territory to 25 Mbps down/2 Mbps up. That’s all in addition to upgrading service to 77,000 Verizon homes at the 10/1 level using subsidies from the federal Connect America Fund program (CAF), which it previously said it would do.

The 100,000 homes currently without Verizon DSL service are mostly in rural areas, as are the 77,000 that fall under the federal CAF program. The 250,000 homes that Frontier is pledging to upgrade, though, might be anywhere in Verizon’s current territory, which includes urban and suburban areas, mostly in southern California.

One caveat: the agreement allows it to use Hughesnet satellite service, which Frontier already resells, as a possible way of meeting those goals.

There are other deal points regarding a few dozen public access locations, money for 50,000 tablets for low income areas, and paying non-profit organisations to market broadband service to people that don’t use it yet.

Memorandum of understanding between Frontier and CETF (33 MB)
CETF summary of the deal

Tellus Venture Associates assisted CETF with research, strategy development and policy options. I’m not a disinterested commentator. Take it for what it’s worth.