Pai to Moran: Happy to Help ISPs Recoup ‘Pledge’ Costs

Will would with Congress on mechanism, but says FCC’s focus was on connectivity

Sen. Jerry Moran (R-Kan.) expressed concerns about whether and how Congress could compensate internet service providers for their contribution to COVID-19 relief–in the form of investment in and payment relief for their customers via the Keep Americans Connected pledge. 

Sen. Jerry Moran concerned about ISP lost revenue from connectivity pledge

That came in a Senate Appropriations Subcommittee hearing on FCC spectrum auction oversight, at which FCC Chairman Ajit Pai.  

FCC Chairman Ajit Pai said the FCC would be happy to work with Congress on a way to compensate ISPs, particualrly smaller, rural carriers, for the lost revenue due to their pledge not to pull the plug on nonpaying customers during the pandemic. 

The FCC adopted its connectivity pledge March 12, then extended it to June 30. Virtually all the major ISPs and many of the smaller ones–over 750 in all–signed on to that pledge. 

Specifically, they pledged to: 

(1) “not terminate service to any residential or small business customers because of their inability to pay their bills due to the disruptions caused by the coronavirus pandemic;   

(2) “waive any late fees that any residential or small business customers incur because of their economic circumstances related to the coronavirus pandemic; and  

(3) “open WiFi hot spots to any American who needs them.” 

Moran asked what the cost to ISPs had been of waived late fees and payments, and whether there was any plan for them to recoup that money, particularly the smaller ISPS, essentially small businesses, who were also suffering economic issues during the pandemic.   

Pai says he would be happy to have ISPs compensated for lost pledge revenue

Pai said he had had conversations with companies and associations that the pledge “can be a hardship.” He said he did not have numbers for lost revenues, but would be happy to work with Congress to find a funding vehicle, though he suggested that could be for “continuing” those connectivity commitments. 

He said he would defer to Congress on the appropriate amount and vehicle for such compensation, but offered his FCC team to work on it with them. 

Moran asked if the FCC had anticipated this would just be a payment “pause,” after which customers would be expected to pay when they could? 

Pai agreed it was a “pause,” but what the companies did afterwards would be up to them. He said the FCC’s focus was in keeping connectivity.