The Biden administration announced Monday that 20 leading internet service providers have agreed to offer basic low cost plans that will be free for millions of Americans after a refund.
The 20 companies, including AT&T (T), Comcast (CMCSA), and Verizon (VZ), cover more than 80% of the US population. They will immediately provide at least one plan that costs no more than $30 a month and provides download speeds of at least 100 mbps.
The White House says that 40% of the US population, about 48 million households, will be eligible to sign up through an existing program called the Affordable Connectivity Program (ACP). The program is aimed at lower income Americans and offers participants a discount of up to $30/month on their internet bill, meaning they’ll effectively get free service if they can get online with one of these participating companies.
AT&T CEO John Stankey said his company’s new plan “when combined with federal ACP benefits, provides up to 100 Mbps of free internet service.”
“Internet for all requires the partnership of business and government, and we are pleased to be working with the Administration, Congress and FCC to ensure everyone is accessible, affordable and sustainable broadband service,” he said.
‘High speed internet at home is no longer a luxury’
Monday’s news came largely thanks to $65 billion set aside for high speed internet in the Bipartisan Infrastructure law. That money has helped fund the ACP and is also being directed towards parallel efforts to increase coverage areas and speeds.
“High speed internet at home is no longer a luxury: it’s a necessity for children to learn, workers to do their job, seniors and others to access health care through telemedicine, and for all of us to stay connected in this digital world,” A senior administration official told reporters in previewing the announcement.
‘A historic opportunity’
Families are eligible for the ACP mostly based on income level. Any household making less than 200% of the Federal Poverty Level — $55,500 for a family of four in the continental US — is eligible. Households can also qualify if they participate in certain government programs like Medicaid or Supplemental Security Income.
“The Affordable Connectivity Program is a historic opportunity to close the digital divide by empowering more Americans to get online and connect to our digital world,” said David N. Watson, the CEO and of Comcast.
The full list of participating companies includes Allo Communications, AltaFiber, Altice USA, Astound, AT&T, Breezeline, Comcast, Comporium, Frontier, IdeaTek, Cox Communications, Jackson Energy Authority, MediaCom, MLGC, Spectrum, Verizon, Vermont Telephone Company, Vexus Fiber , and Wow! Internet, Cable, and TV.
Verizon, as an example, will now offer its existing Fios service for $30/month to program participants. Other companies, like Spectrum, say they will increase the speeds of an existing $30/month plan to reach the 100 mbps standard set by the White House, where their infrastructure allows it.
Pushing more companies to ‘make the same commitments’
Notably missing from Monday’s announcement are many smaller and rural internet service providers that would have a challenge meeting the White House’s pricing or speed requirements.
“I think that there are roughly 1,300 participating internet providers in the ACP right now and we would obviously love for each and every one of them to make the same commitments that these 20 companies are doing,” said a senior administration official.
These companies cover 50% of the rural population. Those Americans are still eligible to sign up for the ACP, but they may continue to face slower speed or plans that aren’t fully covered by the $30 refund.
So far, 11.5 million households have signed up to receive ACP benefits. The program was first created as a relief measure in the early days of the coronavirus pandemic, and Biden officials have moved to make it a permanent as a way to lessen the digital divide.
President Joe Biden and Vice President Kamala Harris will speak at the White House Monday alongside internet company CEOs as the first part of a multi-pronged effort to drive signups. That effort includes a new website, GetInternet.gov, and direct outreach from federal agencies like the Social Security Administration as well as states.
Ben Werschkul is a writer and producer for Yahoo Finance in Washington, DC.
Read the latest financial and business news from Yahoo Finance
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, YouTubeand reddit.